RESPONSE - Marty

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#2.  In three parts, outline your vision for the best system of taxation
for the state of Minnesota.

        1.  What is the tax mix today (income, sales, property, etc.)?
        2.  Where would you like to see the mix in the year 2000?  Why?
        3.  What steps or program do you propose to get from here to there?


John Marty:

Minnesota has traditionally relied more heavily on progressive income taxes
than taxes such as sales, excise and property taxes which are not based on
an ability to pay.  As a result, Minnesota's total tax burden--while still
somewhat regressive --- has less of a disparity in tax burden as a percent
of income between low, middle and upper income brackets.  However, a family
with an income of $300,000 pays a smaller percentage of its income in state
and local taxes than a family with an income of $30,000.

What is troubling to me, and what I have been addressing in this campaign,
is that under Arne Carlson we have been moving toward a system similar to
other states where the wealthiest taxpayers pay a smaller percentage of
their income in total state and local taxes than taxpayers in middle and
lower income brackets.  Most of this shift has occurred as a result of a
half-cent increase in the sales tax that the governor supported to balance
the budget in 1991 and a 54 percent average increase in property taxes over
the last four years.

I believe that the income tax is the fairest way to raise general revenue
and I am supporting an increase in income tax rates for the wealthiest four
percent of taxpayers as a way to shift more of the tax burden away from
property taxes.  My campaign has pledged to deliver $600 million in
property tax relief over the next four years.  That will put us back to
below where we were before the $500 million in property tax increases under
Arne Carlson.

One of the best ways to produce property tax relief is to increase the
proportion of funding for K-12 education that comes from the state.  Under
the governor, Minnesota ranked 49th out of the 50 states last year in the
rate of increase in state funding of education.  We have seen an erosion in
the "Minnesota Miracle" of the early 1970s as the percent of education
funding coming from the state has decreased.  I want to see us gradually
increase that percentage.  I also believe we can shift the overall tax
burden away from property taxes by fully funding human services that are
increasingly a burden on county governments. There is no logical connection
between the property wealth of a school district or county and the
educational needs of our children or the human services needs of a county's
population.

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