Small Business Owners Speak Out Against Dayton Plan

FOR IMMEDIATE RELEASE
Contact: Mike Hickey 651-235-7401 mike.hickey@nfib.org
or Tony Malandra 415-664-9685 anthony.malandra@nfib.org

Small-Business Owners Speak Out Against Dayton Tax Plan

ST.PAUL, Minn., June 28, 2011— Today, leaders of the National Federation of Independent Business,
the state’s largest business group in terms of entities with approximately 12,000 members statewide, held
a press conference to oppose the large, destructive tax hike that Gov. Dayton has proposed. NFIB strongly
opposed the Dayton plan during the 2011 session and testified against it several times in House and
Senate tax committees.

“Minnesota already has a high tax structure and the last thing we need to do is dramatically increase it,”
said Mike Hickey, state director for the National Federation of Independent Business. “The governor’s
proposal would make Minnesota even more uncompetitive than we already are.”

“Governor Dayton’s tax plan sends a very negative signal to successful entrepreneurs and investors in and
out of our state who are considering investing here,” said Hickey. The governor’s tax plan would raise
Minnesota’s top rate to 10.95 percent from its current 7.85 percent—a 39-percent increase that would give
Minnesota the second highest top income tax rate in the country, just a fraction behind Hawaii’s and
Oregon’s which currently have an 11-percent top rate.

Hickey noted that if the increase was enacted, the top capital gains rate would also likely increase to 10.95
percent where applicable also sending a very negative signal to investors, especially out-of-state ones who
might be considering opportunities in Minnesota. “From the out of state investor perspective, they could
get stuck paying either one of these very high rates and it is a big negative.” Hickey noted Minnesota
investors would also feel the sting of the high capital gains rate which would creep up close to the federal
rate of 15%.

If the governor’s plan were enacted, 47 other states would have a lower top income tax rate and capital
gains rate. Nine states don’t tax income or capital gains at all. “Minnesota cannot afford to be this
uncompetitive, and we strongly urge legislators in both parties to reject the governor’s tax plan,” implored
Hickey.

“Minnesota has been running a structural deficit for 10 years now,” said Hickey, “and the Legislature just
increased state spending another 6 percent ($2 billion). In our view, that is enough. State government
needs to learn to live within existing resources.

Hickey said NFIB members are the most income-tax-affected group in the state, because the vast majority
of them pay their company’s taxes on the individual income tax, since they are organized as Sub S, LLC,
or sole proprietorships. “The Governor’s tax plan sends a very peculiar message to small business: If you
are successful in Minnesota and grow your business and expand your workforce—you are going to pay!”
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NFIB is the nation’s leading small business association, with offices in Washington, D.C. and all 50 state capitals. Founded in
1943 as a nonprofit, nonpartisan organization, NFIB gives small and independent business owners a voice in shaping the
public policy issues that affect their business. NFIB’s powerful network of grassroots activists send their views directly to state
and federal lawmakers through our unique member-only ballot, thus playing a critical role in supporting America’s free
enterprise system. NFIB’s mission is to promote and protect the right of our members to own, operate and grow their
businesses. More information about NFIB is available online at www.NFIB.com/newsroom.

National Federation of Independent Business/Minnesota
380 Jackson St., Suite 780
St. Paul, MN 55101
651-293-1283