During a recent debate, both U.S. Sen. Amy Klobuchar and GOP House Speaker Lisa Demuth ruled out raising taxes if elected governor. Demuth said, “Tax hikes are absolutely off the table for me,” while Klobuchar added, “I have made clear I’m not going to increase taxes, and I would actually like to lower taxes.”
In comments reminiscent of President George H.W. Bush’s infamously broken “read my lips” pledge, the candidates took a stance that current budget realities and recent history suggest is unrealistic. Just to begin with, the state tax code changes nearly every year, as lawmakers adjust rates, credits and exemptions, and some of those changes raise taxes. Just six months ago, conservative Lisa Demuth voted for tax increases included in the 2026 tax bill, which will raise $353 million in 2028-29 through conformity to federal tax changes.
More substantively, blanket anti-tax pledges overlook the foundational role that taxes play in shaping a fair and functional society. Taxes are how we pay for the schools, roads, hospitals and other public goods that every community relies on. Minnesota does have higher taxes than many other states, but we also get less revenue from fees and other non-tax sources, which is easier on working families because progressive taxes ask more of those who earn more, while flat fees cost everyone the same.
Anti-tax soundbites may work on a debate stage, but the Legislature has to pass a budget in the upcoming session, and the next governor shouldn’t take policy options off the table before it starts. The allure of an anti-tax message is understandable given both candidates’ desire to deliver on the broad promise of affordability, but the reality is that most pro-affordability policies would require more revenue, not less. The state government can’t set the price of groceries, but it can address rising costs in healthcare, housing, childcare and other areas through proactive public investment.
With a looming $2 billion deficit, the state can scarcely balance its budget without additional revenue, let alone invest in new affordability initiatives. Two unaffordable visions of affordability Demuth’s “Affordability Agenda” would cut taxes on property, car tabs, income, gas, Social Security benefits, tips and overtime. Four of those cuts alone – Social Security, overtime, tips and gas – would cost more than $1.5 billion in the 2028-29 budget, according to Department of Revenue estimates of similar bills.
To offset those cuts, Demuth promises to direct her commissioners to find $1 billion in savings, plus another $1 billion from cracking down on fraud. That will be easier said than done, especially considering that her calculations are based on an unproven estimate of total fraud in Minnesota. Demuth’s cuts would put money back in taxpayers’ pockets in the short run, but they would erode public services like K-12 education, rural healthcare and basic infrastructure that lie at the foundation of functional communities.
Klobuchar would aim to lower costs through direct investment in the needs of Minnesotans. Her plans include expanding the state’s reinsurance program that’s aimed at making health insurance cheaper, building more child care centers and creating a rural housing loan fund. These investments could have substantial impacts on the cost of living, but they all cost money. Klobuchar says economic growth and a top-to-bottom audit of state government would help pay for them, but the immediate savings are unlikely to be enough to balance the budget while also making meaningful investments in these new programs.
The cost of tax cuts Apart from the vilification of taxation, one essential problem here is the separation of taxes from what they pay for. A tax cut may add
