Business leaders urge lawmakers to repeal taxes, Steve Wise has big money tied into his Brooklyn Center manufacturing business, Cass Screw Machine Products. He’s even more concerned this year about his bottom line with the advent of new business-to-business taxes enacted in the 2013 legislative session.
“Every tax, every cost, every form that they put upon a business matters to us,” said Wise.
Cass Screw Machine Products manufacturers thousands of parts each year for companies such as Bobcat, Toro and Polaris, but if one of the high-tech machines at Cass Screw breaks down, the company now faces a business equipment repair tax on the labor required to fix it.
“That means about ,000 to my business [a year],” said Wise. “It doesn’t sound like much, but again here we go, another creep on my business, another extraction from my bottom line. I’ve got to make a lot of screw machine parts to make up ,000.”
In addition to taxing businesses for equipment repair, the 2013 Minnesota Legislature passed two other business-to-business taxes for the purchase of telecommunications equipment, and for storage and warehousing services.
On Friday, local business leaders gathered at Wise’s business in Brooklyn Center to encourage local lawmakers to repeal the taxes when the new legislative session starts or face the possibility that companies will leave the state.
“When you start looking at businesses not as cherished citizens, but as pocketbooks to be raided, what it does is it just declines the whole business climate in the state,” said Wise.
State Rep. Lyndon Carlson, DFL-Crystal, said he had concerns about the business-to-business taxes last session, but the senate initiative was part of a larger budget package.
“It became an up or down vote with many of us having concerns about it,” said Carlson.
Carlson said if the state’s projected budget surplus of 5 million holds, he believes the legislature will be in a good position to repeal the taxes.
“Governor Mark Dayton would like to see it repealed, I know there’s a lot of interest in repealing it on the house side,” said Carlson. “But it was a Senate position, and I haven’t had a dialogue personally with many of the senators to know what their position might be.”
Steve Wise just hopes the legislature takes it up as their first order of business, so it no longer cuts into his business.
“If it’s truly a priority, make it a priority,” said Wise.
In conversations with 12 News on Friday, Sen. Ann Rest, DFL-New Hope and Sen. John Hoffman, DFL-Champlin, both said they’re willing to re-examine the business-to-business taxes, but they’ll take a “wait and see” approach until the latest budget forecast comes out in early March.
The 2014 legislative session begins Feb. 25.
Alexandra Renslo reporting
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