Tax-free baby products considered by MN lawmakers
A new proposal before Minnesota lawmakers would wipe out taxes on popular childcare products such as baby wipes, cribs and car seats, but some think there are more effective ways to give families relief.
ST. PAUL, Minn. (FOX 9) – Raising kids can be incredibly rewarding, but it’s an expensive proposition.
Budget for babies
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Cutting costs:
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Minnesota legislators have a few ideas to cut the costs, including sales tax exemptions proposed on Tuesday to make some big purchases a little more affordable.
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A lot of baby products are already exempt from sales tax, like diapers and bottles and pacifiers.
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The proposal would add more items to the list, but some see the tax breaks as redundant.
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Birth of a bill
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Cash deprivation:
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A newborn baby gave Rep. Elliott Engen (R-White Bear Township) a new perspective on his pocketbook.
“Going to Target with my wife and seeing all the items that not only I’m purchasing, but friends and peers of ours are also purchasing – that influenced my decision,” said Rep. Engen.
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Less than a year into fatherhood, Engen is proposing a sales tax exemption for baby wipes, cribs and bassinets, changing tables, strollers and car seats.
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Among those supporting the proposal include the Minnesota Catholic Conference and the Women’s Foundation.
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“The sales tax on baby products affects all families regardless of income, but it has a disparate impact on women and single-female headed households,” said Sara Gangelhoff of the Women’s Foundation of Minnesota.
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A better way?
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Decrease from DFL:
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On the other side of the aisle, Democrats recognize the issue is real.
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They say the cost of raising a family is enormous and rising, but they’re not on board with Engen’s bill.
“There are other ways that we can provide financial relief to new parents and maybe [be] more targeted,” said Rep. Zack Stephenson, (DFL-Coon Rapids).
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DFL lawmakers point out they have made parenthood cheaper and easier over the last couple of years by passing paid family medical leave, free school meals and a new child tax credit.
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The $1750 per child credit is targeted towards lower income families, making sure they can absorb the costs of things like baby wipes and bassinets.
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Compare and contrast plans
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Super savings:
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While the sales tax exemptions could save Minnesota families about $10 million a year, the child tax credit already saved them $545 million last year.
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It also gives parents a choice of where to spend the money.
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“The increase in the cost of raising a child that Rep. Engen identifies is really not about sales taxes on bassinets,” said Rep. Aisha Gomez, (DFL-Minneapolis). “It’s about things like the cost of childcare and other issues.”
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What’s next:
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The bill passed out of committee on a party line vote, but Democrats say they’re sticking with the tax credit, so it is unlikely to become law this year.
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