For Minnesota governor Mark Dayton, increasing the state income tax rate from 7.85% to 9.85% doesn't go quite far enough. He wants to impose what is referred to as a "snowbird tax" on part-time residents who spend as much as two months out of the year in Minnesota.
The general rule, observed by virtually all states, is that you owe state income taxes to the state in which you have your primary residence -- loosely defined as where you live more than one-half of the year.
For instance, many Texans own vacation homes in states such as Colorado and California, which levy state income taxes. (Texas does not.) If the authorities of an income tax state suspect that a homeowner lives there six months or more out of a given year, they may require that he prove otherwise by producing credit card records for such things as restaurant, grocery, and fuel bills. That's very easy to do if you keep decent records.
But some of Minnesota's big spenders want to go a step further:
http://www.freerepublic.com/focus/f-news/2984400/posts
However, the plan may backfire, or at the very least not raise anything even remotely close to the anticipated additional revenue:
http://www.ocregister.com/opinion/st...esota-tax.html
http://minnesota.publicradio.org/dis...wbird-tax-plan
A state's part-time residents spend money in stores, restauarants, and other businesses. Additionally, many pay substantial property taxes.
Chasing them away or disincentivizing them to spend a significant amount of time in the state seems like very bad business to me.
If this idea isn't quickly perceived as an abject failure, other revenue-hungry states might pick up on it. The story could have import for anyone considering the purchase of a retirement or vacation home.
Any thoughts or comments?