Commentary: Anti-tax pledges — never a good idea

During a recent debate, both U.S. Sen. Amy Klobuchar and GOP House Speaker Lisa Demuth ruled out raising taxes if elected governor. 

Demuth said, “Tax hikes are absolutely off the table for me,” while Klobuchar added, “I have made clear I’m not going to increase taxes, and I would actually like to lower taxes.” 

In comments reminiscent of President George H.W. Bush’s infamously broken “read my lips” pledge, the candidates took a stance that current budget realities and recent history suggest is unrealistic. 

Just to begin with, the state tax code changes nearly every year, as lawmakers adjust rates, credits and exemptions, and some of those changes raise taxes. Just six months ago, conservative Lisa Demuth voted for tax increases included in the 2026 tax bill, which will raise $353 million in 2028-29 through conformity to federal tax changes.

More substantively, blanket anti-tax pledges overlook the foundational role that taxes play in shaping a fair and functional society. Taxes are how we pay for the schools, roads, hospitals and other public goods that every community relies on. Minnesota does have higher taxes than many other states, but we also get less revenue from fees and other non-tax sources, which is easier on working families because progressive taxes ask more of those who earn more, while flat fees cost everyone the same.

Anti-tax soundbites may work on a debate stage, but the Legislature has to pass a budget in the upcoming session, and the next governor shouldn’t take policy options off the table before it starts. 

The allure of an anti-tax message is understandable given both candidates’ desire to deliver on the broad promise of affordability, but the reality is that most pro-affordability policies would require more revenue, not less. 

The state government can’t set the price of groceries, but it can address rising costs in healthcare, housing, childcare and other areas through proactive public investment. With a looming $2 billion deficit, the state can scarcely balance its budget without additional revenue, let alone invest in new affordability initiatives.

Two unaffordable visions of affordability 

Demuth’s “Affordability Agenda” would cut taxes on property, car tabs, income, gas, Social Security benefits, tips and overtime. Four of those cuts alone — Social Security, overtime, tips and gas — would cost more than $1.5 billion in the 2028-29 budget, according to Department of Revenue estimates of similar bills. 

To offset those cuts, Demuth promises to direct her commissioners to find $1 billion in savings, plus another $1 billion from cracking down on fraud. That will be easier said than done, especially considering that her calculations are based on an unproven estimate of total fraud in Minnesota. 

Demuth’s cuts would put money back in taxpayers’ pockets in the short run, but they would erode public services like K-12 education, rural healthcare and basic infrastructure that lie at the foundation of functional communities. 

Klobuchar would aim to lower costs through direct investment in the needs of Minnesotans. Her plans include expanding the state’s reinsurance program that’s aimed at making health insurance cheaper, building more child care centers and creating a rural housing loan fund.

These investments could have substantial impacts on the cost of living, but they all cost money. Klobuchar says economic growth and a top-to-bottom audit of state government would help pay for them, but the immediate savings are unlikely to be enough to balance the budget while also making meaningful investments in these new programs. 

The cost of tax cuts

Apart from the vilification of taxation, one essential problem here is the separation of taxes from what they pay for. A tax cut may add a little to your paycheck, but the money comes out of the public services that we all rely on, and the costs will be felt elsewhere.

President Trump’s One Big Beautiful Bill Act, for example, will cut federal tax revenue by more than $5 trillion from 2025 to 2034. This cut is partially offset by more than $900 billion in Medicaid spending reductions that will result in as many as 140,000 Minnesotans losing coverage. This will endanger human lives and community welfare, and the costs will simply be felt elsewhere.

Minnesotans kicked off Medicaid will still receive care, only now they will get it in emergency departments rather than primary care clinics, with the cost passed on to the rest of us. One-quarter of the state’s hospitals are financially distressed, and many are already cutting services, leaving patients with longer trips and longer waits for care. Hospital leaders warn that the federal Medicaid cuts could push small-town hospitals to close.

There are direct costs as well. When the state cuts taxes or suppresses needed funding, as both Klobuchar and Demuth’s approach would require, local governments pick up the slack in the form of property taxes.

Cities today rely far more on property taxes than they did 30 years ago when state revenues and aid were both larger as a share of our state’s economy. General-purpose state aid has fallen from 27% of city budgets in 1996 to 9% in 2026, while the share from property taxes has risen from 32% to 52%. The trend continued this year, as local property tax levies across the state increased $873 million or 6.8%, from 2025. 

On top of worse public services and higher property taxes, anti-tax pledges rule out the investments that could bring costs down for everyone.

Change requires revenue 

Economic anxiety has become a top issue this fall. To address it, policymakers need to consider what is driving it and where state government has meaningful power to intervene. 

For most families, the pressure comes from a few large bills: housing, childcare, and healthcare. A tax cut doesn’t make a rent check, a day care bill or an insurance premium any smaller, and pushes the costs further down the line, onto property tax bills and the services families rely on.

What would significantly reduce this anxiety is better access to those basic needs. That is what Klobuchar’s agenda is driving at, but a pledge not to raise taxes leaves little room to deliver the results she wants.

In a more recent second debate, both candidates make a second pledge: To part ways with a broken status quo. Leaving it behind will cost money, and the next governor will need to be willing to raise it.