Minnesota 2025-2026 Regular Session

Minnesota House Bill HF3190

Introduced
4/21/25  

Caption

Gross receipts tax imposed on various services including but not limited to legal, accounting, and architectural services.

Impact

The implementation of HF3190 will notably affect Minnesota's tax structure by introducing a new taxation model for services, enhancing revenue generation for the state. Specifically, revenues collected from this tax will contribute to the general fund, indicating a strategic move to support state financial needs through a broader tax base. This change impacts state laws by integrating additional taxation measures for business transactions, obligating entities engaged in selling taxable services to comply with new reporting requirements, thus increasing the jurisdiction of state taxation over business-to-business transactions.

Summary

House File 3190 introduces a gross receipts tax of two percent on various taxable services provided between business entities in Minnesota. This tax applies to services such as legal, accounting, architectural, engineering, and several others, as defined in the bill. Trade or business entities must report this tax and are allowed, though not obligated, to collect it from purchasers if separately stated on their invoices. This legislation aims to create a fair mechanism for taxation of services provided in the business sector, ensuring that such transactions are subject to a standardized tax rate across Minnesota.

Contention

Notably, discussions surrounding HF3190 may focus on its potential impact on the service industry and the associated compliance burden for businesses. Some stakeholders argue that while the tax may enhance state revenue, it could also introduce challenges for smaller businesses who may struggle with the administrative requirements of the tax. Proponents suggest that the tax creates a level playing field in terms of business accountability and revenue contribution, promoting a more equitable economic landscape. However, debates are likely to arise regarding the appropriateness of taxing services traditionally not subjected to such levies, leading to conversations about fair taxation practices in an evolving economic environment.

Companion Bills

MN SF3397

Similar To Gross receipts tax enforcement on various services

Previously Filed As

MN SF3397

Gross receipts tax enforcement on various services

MN SF3332

Sales and use tax exemptions elimination, gross receipts tax on various services imposition

MN HF5055

Individual income, corporate franchise, sales and use, and gross receipts taxes and other various taxes and tax-related provisions modified; federal conformity provided; sustainable aviation fuel credit modified, firearms gross receipts tax imposed, social media tax imposed, and money appropriated.

MN HF4971

Individual income and gross receipts tax; tax return checkoff provided, lodging and pay television services tax imposed, and conforming changes made.

MN SF1956

Lawful gambling receipts imposed taxes repealer and various technical changes

MN HF2679

Small rural ambulance services exempted from health care gross receipts taxes.

MN SB295

Gross Receipts Tax Changes

MN SF2765

Small rural ambulance services health care gross receipts taxes exemption provision

MN SF1386

Amusement device gross receipts tax establishment

MN SF4194

Gross receipts tax on hospitals and health care providers

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