Tensions Over Tax on Farm Machinery Repairs Delays Tax Bill

The inclusion of business-to-business taxes, particularly those that could cost farmers, are causing last-minute tensions over the omnibus tax bill.

In particular, a provision that would apply the sales tax to farm machinery repairs is causing DFLers heartburn. During last night’s House debate on the bill, there was some confusion about whether the provision was included in the bill. But according to House Taxes Chair Ann Lenczewski, the sales tax on farm machinery repairs would kick in on July 1 and raise $28 million in the next biennium.

Lenczewski says senators are now claiming that provision was a mistake, but she’s adamant that members of the conference committee insisted on its inclusion, as well as other business-to-business taxes. The House has not yet sent the tax bill to the Senate, but Lenczewski says she’s not interested in re-opening the bill to eliminate the controversial tax.

“The Senate insisted on it and now they’re saying it was an error,” Lenczewski tells PIM. “They’d like us to open the tax bill to fix their problems. ”

Just five hours remain until the Legislature is slated to adjourn.

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