Two state legislators want Wis. tax reciprocity deal revivedby Curtis Gilbert, Minnesota Public Radio
St. Paul, Minn. — Two state legislators want Minnesota's tax reciprocity agreement with Wisconsin re-instated.
Reciprocity allows people who live and work in different states to just pay income taxes where they live. Gov. Pawlenty announced last Friday he would end the program January 1, because Wisconsin takes too long to reimburse Minnesota under the agreement.
Ending reciprocity will net Minnesota about $130 million for the current budget cycle.
But DFL State Sen. Sharon Erickson Ropes says the downside is some 8,000 Minnesotans will see their tax bills go up by an average of $300.
"Local commuters are going to wind up picking up the slack for the difficulty between the Department of Revenue in Minnesota and the Department of revenue in Wisconsin and I just think that's wrong," Ropes said.
Sen. Ropes will co-sponsor a bill with Republican State Rep. Greg Davids to re-instate reciprocity. The legislation would also take away the governor's power to end the agreement without legislative approval.