MN BUDGET DEAL: 4 things you need to know - FOX 35 News Orlando

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MN BUDGET DEAL: 4 things you need to know

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ST. PAUL, Minn. (KMSP) -

Minnesota has a state budget deal. Now, it's time to vote.

A late night session ended with an agreement that will hit higher income earners and smokers.

Gov. Mark Dayton, House Speaker Paul Thissen and Senate Majority Leader Tom Bakk say the agreement will pave the way for the Legislature to pass its budget before a mandatory Monday night adjournment to the session.

BUDGET BREAKDOWN

- Income tax rate will increase by two percent for top two percent of income earners: couples making more than $250,000 per year and singles making $150,000 per year.

- Per-pack tax on cigarettes will increase by $1.60.

- Some corporate tax preferences will go away.

- There won't be any changes to the alcohol tax.

Combined, the taxes will generate $2 billion more for Minnesota's two-year budget. Democrats say there is $400 million in potential property tax relief in their plan.

Part of the tobacco tax will go to fund the new Vikings stadium. Lawmakers have different thoughts on whether that's a good idea.

"The bottom line is if they take it from a cigarette tax, it is money they would otherwise go to schools, to health and human services and the like," said Sen. Dave Thompson.

"This will be coming out the new revenues that we are generating my expectation is that it won't be a middle class tax impact," said tax chairman Sen. Rod Skoe.

The cigarette tax hike would bring the total tax to over $4 per pack. That would make Minnesota the 6th highest state tax on cigarettes, up from 28th.

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