Minnesota’s taxes on private sector job creators and higher income taxpayers are higher than most other states. The gap between Minnesota and peer and neighboring states is wide, and getting wider. In the last two years, 27 states have reduced taxes and rates to make their states more attractive for investment and talent. Minnesota’s tax rates are in the top ten highest for both individual and corporate taxpayers, making the state an outlier. It is also one of 12 states still imposing an estate tax. These tax burdens create a barrier to economic growth, as high tax rates undermine investment, entrepreneurship and attraction and retention of talent – all items needed for strong private sector growth. ECONOMIC POTENTIAL Minnesota’s economy is highly developed, with the fifthmost diverse economy in the nation. In fact, the state ranks high across a range of metrics, with leading industry clusters, 16 Fortune 500 headquarters, high rates of innovation and one of the highest workforce participation rates in the nation. Minnesota’s future economic success is not guaranteed, and policies need to reflect the realities of an ever-increasing competitive landscape. CHALLENGES As is highlighted in the Minnesota Chamber Foundation’s Minnesota: 2030 report, the state’s overall economic performance is no longer nation-leading. Minnesota grew faster than the U.S. for decades, with job growth exceeding national job growth for 27 of 35 years from 1970-2004. Growth accelerated in the 1990s, with real GDP climbing 3.9% on average and employment growing 2.2% annually. Minnesota’s GDP growth and job growth lag the national average in nine of the last 10 years. Minnesota continues to have uneven outcomes across demographic groups and regionally, with populations of color and nonmetropolitan areas experiencing lower levels of economic well-being on average. Minnesota is losing population to other states. Domestic net migration ranks 42nd worst in 2021, and workforce growth has stagnated. CHOOSE TO GROW MINNESOTA Many factors impact the decision for businesses and individuals on where to invest or locate, including family, weather, cost of living and natural amenities. Not all of these factors are within policymakers’ control. However, tax policies that hinder growth opportunities are within policymakers’ control, and tax policy changes can yield economic results much more quickly. Minnesota’s top rate is the sixth-highest in the nation at 9.8% and is higher than all non-coastal states. Minnesota’s top rate kicks in at a lower threshold than other states’ top rate, so for some incomes, Minnesota’s tax burden is secondhighest in the nation. Minnesota’s next rate of 7.85% also ranks in the top 10 highest in the nation. Numerous economic research has found that high-income taxes negatively impact talent recruitment, investment and entrepreneurship. Minnesota is also only one of 12 states that still has an estate tax. The high income tax combined with estate tax creates a large financial disincentive for wealthier taxpayers to remain in Minnesota and hinders transfers of family businesses and farms. By 2024, Minnesota will have the highest corporate income tax rate in nation at 9.8% with the sunset of New Jersey’s 2.5% surcharge (imposed on income above $1 million). In 2023, Minnesota’s tax will already be highest in the nation for corporate taxpayers with net income under $1 million. Other states with high tax rates have implemented tax reforms to improve business competitiveness, including Pennsylvania and Iowa. Pennsylvania is phasing in corporate rate reductions with a reduction from 9.99% to 8.99% beginning in 2023 and then a 0.5% rate decrease until it reaches 4.99% in 2031. With a top rate of 9.8%, Iowa is phasing in corporate rate reductions based on revenue triggers until the rate reaches 5.5%. The corporate tax is a regressive tax as, ultimately, it is paid by consumers, employees and investors. According to economic research, the corporate tax is also one of the most volatile and economically detrimental taxes.

Bear Tracks Self-Driving Shuttle! FREE & Open to the Public!

HOW TO FILL WORKFORCE GAPS BY CREATING A DISABILITY-INCLUSIVE WORKPLACE More people with disabilities have a two-year degree and are looking for work than those without a disability. How can you include workers with disabilities in your workforce strategy? Recently, the Minnesota Chamber kicked off its Workforce Solutions Series with a virtual event featuring strategies from experts on how building an inclusive workplace can help your business meet your recruitment needs and provide meaningful, fulfilling employment. INTERESTED IN LEARNING MORE? Click below to view the full on-demand webinar from the Workforce Solutions Series.

The Latest on Omicron from the Minnesota Department of Health January 14, 2022 | By Commissioner Steve Grove | Economic Development This week, the Department of Employment and Economic Development (DEED) convened business leaders from across Minnesota to learn about the latest information on the Omicron strain of COVID-19. If you missed these webinars, you can watch it here. Omicron is a very effective strain of the virus and moves quickly, in fact, it is doubling every 1.5 - 3 days. In Minnesota, the large number of cases suggest widespread community transmission, leading to an estimated 90% of cases right now likely attributed to Omicron. As cases rise, the increase in demand for hospital resources follows. Our healthcare capacity is stretched very thin and the demands on it are expected to worsen. And our workforce is at continued risk of increased absences due to the disease. The bottom line: the best way to arm yourself against Omicron is to get vaccinated and boosted, mask up and stay home when you are sick. While there is evidence of less severe disease, we must continue to get Minnesotans vaccinated – the Omicron strain is a especially milder in people who are immunized through vaccination before they contract the infection. Updated quarantine guidance: The following guidance applies in all cases: You must be able to mask at all times when with others (30% of cases are still infectious at day 6). You should avoid immunocompromised and higher risk individuals. There are shortened timelines for returning to work, school and essential activities, detailed below. If you test positive during quarantine, you will need to move into isolation. Some additional sector-specific guidance is in development, and we will share that as it is developed.

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Friday, December 3rd, 2021 Between 11:00 am & 7:00 pm Chamber office, 4751 Highway 61, WBL With a Special Holiday Singing Appearance from: Children's Performing Art s' Cast of Elf Jr. 5:00pm - 6:00pm Join us for a special 'Not Your Typical' Gala! Come as you are, come when you want (between 11:00am - 7:00pm), bring a friend, bring your whole office, just be sure to bring your wallet for some great shopping at our spectacular Silent Auction! Registration is only $25 and includes:Tasty appetizers, our delectable dessert buffet, beverages (Yep, adult ones, too!!) Get your bid on with our amazing auction, check-out our bountiful Restaurant Tree and much, much more! It's all fun. Special Office Packages available - includes additional signage and advertising! Contact Shari or Maureen at 651-429-8593 for Silent Auction Donations. Thank you to our sponsors: Grandma's Bakery Hallberg Engineering HyVee Maplewood Kowalski's Pine Tree Apple Orchard Stonehouse Catering Sponsorships available call our Chamber office for more details.

Vaccine Mandates: The Most Important Questions for Businesses Answered New rules around employee vaccine mandates go into effect on November 5. Here’s our guide to which businesses are subject to the rules, which employees need to be vaccinated, options for unvaccinated employees, and more.

On Thursday, September 9, President Biden mandated "that all employers with more than 100 workers require them to be vaccinated or test for the virus weekly, affecting about 80 million Americans." Check back here as more details emerge about what this means for Minnesota employers. Biden announces vaccine mandate for employers with more than 100 workers from Associated Press (September 9, 2021) What Biden's vaccine mandate means for employers from The Business Journals (September 9, 2021) Vaccine mandates now required: What to know about Biden’s new rules from HR Executive (September 9, 2021) Minnesota businesses await more guidance in wake of Biden vaccine mandate from Fox (September 9, 2021) 6 experts on what Biden’s vaccine mandate means for HR from HR Executive (September 10, 2021) What employers can do now to prepare for Biden's vaccine mandate from The Business Journals (September 23, 2021) As mandate looms for large firms, how are small businesses approaching vaccinations? from The Business Journals (September 27, 2021)

The 2021 Legislative Session was defined by the ongoing global COVID-19 pandemic, considerable financial uncertainty, unprecedented levels of federal stimulus and the state operating under 16 months of emergency powers. With the Legislature, lobbyists and stakeholders working remotely, a record number of bills were introduced, many of which were unrealistic and overly ambitious given the constraints of the session and the partisan make-up of the nation’s only split legislature (House controlled by Democrats, Senate controlled by Republicans). The regular session started in January and concluded May 17, requiring a 16-day special session to complete the state’s fiscal years 2022-23 budget and avoid a shutdown. The budget forecast unexpectedly changed from a $1.2 billion deficit in November to a $1.6 billion surplus in February. In March, the federal government provided Minnesota $2.83 billion in American Rescue Plan Act (ARPA) funds. Guidance on use of these funds was provided in mid-May—the primary reason for the special session. Local governments, higher education institutions, public schools, hospitals and child care facilities received over $5 billion in federal emergency funds directly. In addition to the surplus and federal funds, state budget reserves are at robust levels of $1.88 billion. State government spending is projected to be $2.83 billion under current law for FY 2022/23 (6.8% growth over previous budgets). Even with a large surplus and record federal funding, Governor Walz and the House DFL majority aligned on proposals to enact new permanent tax increases to fund new spending. The proposed tax increases included a new 5th tier for individual income tax, corporate rate increase; surcharge on capital gains; and higher taxes on corporate foreign earnings. The Senate Republicans were opposed to any new tax increases and argued spending needs could be prioritized with current law resources and the additional federal dollars. The Minnesota Chamber’s approach with policymakers was to “do no harm” to employers and the still recovering economy. We succeeded in helping to stabilize businesses that had suffered economic disruption and damage, protected employers from onerous mandates, and positioned the economy to not just recover but to grow.