This bill proposes extensive changes to Minnesota's tax laws, affecting individual income taxes, corporate franchise taxes, sales and use taxes, and property taxes. A significant feature is the establishment of a direct free filing system for individual income tax returns, allowing taxpayers to file electronically at no cost starting from taxable years after December 31, 2025. The bill also introduces new provisions for political contribution refunds, modifies tax credits for beginning farmers, and includes measures for local government aid and tax increment financing. Notably, it repeals the tax on illegal cannabis and controlled substances, introduces new definitions for tax exemptions, and establishes a legislative task force on local sales and use taxes.

Additionally, the bill amends various statutes to enhance tax benefits and streamline processes, including the introduction of a "baby bonus" credit for qualifying children, adjustments to property tax exemptions for veterans and low-income housing, and new provisions for tax increment financing districts. It also clarifies the classification of properties used for commercial and recreational purposes and establishes a tax framework for illegal cannabis, imposing specific tax rates and penalties for non-compliance. Overall, the bill aims to modernize tax administration, provide relief to taxpayers, and support economic development initiatives across Minnesota.

Statutes affected:
Introduction: 41A.30, 270C.445, 290.068, 290.0695, 270.075, 272.02, 273.19, 273.38, 273.41, 477A.19, 297A.61, 297A.62, 297A.65, 297F.25, 289A.60, 290.0693, 290A.19, 290C.07, 295.81, 477A.32
1st Engrossment: 10A.02, 10A.322, 41B.0391, 270C.445, 290.0132, 290.06, 290.0661, 290.0695, 290A.03, 462A.39, 462A.40, 270C.15, 289A.20, 297A.68, 297A.77, 297A.99, 297F.01, 297F.03, 297F.04, 297F.06, 297F.09, 297G.09, 272.01, 272.02, 273.13, 273.38, 273.41, 290B.03, 290B.04, 290B.05, 469.1812, 469.1813, 469.174, 469.175, 469.176, 469.1761, 469.1763, 469.177, 373.40, 446A.086, 462C.04, 469.104, 469.154, 474A.091, 475.521, 641.23, 3.192, 3.8855, 37.31, 270C.11, 289A.60, 290.0693, 290A.19, 290C.07, 295.53, 295.54, 295.81, 297H.01, 297H.13, 609.902, 477A.32, 116U.27, 290.01, 290.0134, 297A.71, 297A.75, 297A.94, 297A.995, 289A.12, 297E.06, 297I.20
2nd Engrossment: 10A.02, 10A.322, 41B.0391, 270C.445, 290.0132, 290.06, 290.0661, 290.0695, 290A.03, 462A.39, 462A.40, 270C.15, 289A.20, 297A.68, 297A.77, 297A.99, 297F.01, 297F.03, 297F.04, 297F.06, 297F.09, 297G.09, 272.01, 272.02, 273.13, 273.38, 273.41, 290B.03, 290B.04, 290B.05, 469.1812, 469.1813, 469.174, 469.175, 469.176, 469.1761, 469.1763, 469.177, 373.40, 446A.086, 462C.04, 469.104, 469.154, 474A.091, 475.521, 641.23, 3.192, 3.8855, 37.31, 270C.11, 289A.60, 290.0693, 290A.19, 290C.07, 295.53, 295.54, 295.81, 297H.01, 297H.13, 609.902, 477A.32, 116U.27, 290.01, 290.0134, 297A.71, 297A.75, 297A.94, 297A.995, 289A.12, 297E.06, 297I.20