A reliable and affordable supply of electricity is critical to all businesses regardless of industry, size or location. That can be accomplished by increasing conservation, base-load generation and transmission system capacity.

Electricity is a significant operating cost for Minnesota businesses. In 2004, Minnesotans spent $3.95 billion on electricity with the state's commercial/industrial customers accounting for $2.3 billion. Minnesota ratepayers have begun to pay significantly more for electricity. Statewide average electricity rates typically mask high rates paid by many business customers. Although Minnesota's commercial rates appear to be low relative to national averages, rates vary substantially based on which utility provides the service and where the customer is located.

All Minnesotans deserve access to quality and affordable health care. The Minnesota Chamber's initiatives parallel the underlying principle of Gov. Tim Pawlenty's Smart Buy Alliance: Build quality and affordability by changing purchasing and consumer behaviors. Our focus is providing practical tips on how businesses can incorporate these principles into their purchasing decisions and educate their employees so that everyone becomes health care shoppers, not just consumers.

Health care costs are an enormous burden on business and show little sign of slowing without corrective action. Minnesotans spent $25.5 billion on health care in 2004. The Midwest Business Group on Health estimates that 30 percent of all direct health care outlays are the result of poor quality care - consisting primarily of overuse, misuse and waste.

People love to complain about taxes, yet we all understand the need to fund essential programs and services such as schools, public health programs and roads. As Minnesotans, we only ask that the tax laws be written fairly and that our tax dollars are used efficiently. The Minnesota Chamber makes those same requests when we advocate on tax policies at the state legislature. Our goal is to keep Minnesota competitive as a place for businesses to create new jobs and fulfilling careers for individuals.

Why Business Taxes Matter to All Minnesotans
Business taxes cannot be viewed in a vacuum. Tax studies show that most businesses recoup higher taxesby charging customers more for their goods and services, limiting employee wages and benefits, orreducing returns to shareholders. Businesses are increasingly competing on national and global scales. High taxes reduce their profits and make them less competitive in the marketplace. As a result, business owners are forced to make difficult decisions such as reducing workforce or relocating operations.
Regardless of where we work, all Minnesotans are affected by business successes and failures. Jobs are the backbone of our economy. As a state, we should enact policies that encourage businesses to create good jobs and economic growth. Excessive state taxes only serve as a deterrent.

Where We Rank

Minnesota remains one of the highest taxed states for businesses. We rank among the highest states for the individual income tax (7th) and the corporate income tax (3rd). In 2007, the state legislature proposed legislation that would have given us the highest individual income tax bracket in the country. These tax rates are not attractive for start-up businesses or employers looking to create jobs in our state.
Minnesota's high business taxes are driven by two factors:
Budgeting is Hard' Raising Taxes is Easy. To their credit, legislators want to solve problems. As a result, the state government provides a lot of services to a lot of people. Unfortunately, government solutions are often complicated and expensive, as is their method of budgeting. Instead of establishing the amount of tax revenue available and prioritizing spending within those limits, the government often creates a wish list of projects and programs and then looks for ways to pay for them ' usually with increases in taxes or fees.
Businesses Don't Vote. Not surprisingly, voters are not in favor of increasingly higher taxes. Lawmakers understand this. They also understand that businesses pay taxes but don't vote. It is tempting, then, to fund programs by raising taxes on businesses. This may seem like a great idea in the short term but the long-term effects on job creation and economic development hurts all Minnesotans.
The Minnesota Chamber studies tax policies around the nation. We frequently weigh in on tax debates to ensure that public policy will make Minnesota more attractive for good jobs, greater economic development and provide a better quality of life for all Minnesotans.

A dependable transportation network is necessary for the safe and efficient movement of people and goods statewide. The state needs to invest at least an additional $1 billion per year to meet performance targets in highways and transit, according to the Minnesota Department of Transportation. Our infrastructure will remain substandard without a permanent and substantive investment of state dollars.

Reduce employer costs by addressing workers' compensation issues, unemployment insurance, wage issues and other employer mandates. Several initiatives were advanced in 2007 with respect to union organizing and employment law, and we expect similar proposals in 2008.

Specific to workers' compensation, the system is under scrutiny as costs have increased since 2001 for a variety of reasons including market conditions, lower investment returns and medical costs. Medical costs now represent more than half of all loss costs within the workers' compensation system and are projected to be a major driver of future premium increases.