(Editor’s Note: The following article was unsolicited from Novotny’s office).

On Tuesday, I joined the call by Rep. Greg Davids, R-Preston, Republican Lead on the House Taxes Committee, who sent a letter to House Taxes Committee Chair Rep. Paul Marquart, DFL-Dilworth, urging quick action to pass a bill exempting forgiven Paycheck Protection Program (PPP) loan income from state taxes in light of the state’s projected $1.6 billion surplus.

PPP loans were lifelines for thousands of businesses to help keep staff employed during the COVID-19 pandemic. These forgivable loans are not taxed at the federal level or by any of the other states in the upper Midwest. This puts Minnesota businesses at a competitive disadvantage and will significantly harm small businesses owners that employ our neighbors and families. We cannot delay and let this important fix get caught up in end-of-session political games. It is time to take action, now.

The letter notes that Chair Marquart was quoted in the Star Tribune over the weekend that “[w]e laid the bill over and we’ll see how the finances look.” Marquart has indicated support for the measure in other recent media interviews as well.

Last week, Gov. Tim Walz signaled support for the exempting forgiven PPP loans, saying “it’s not intended to punish those very businesses it helped,” and replying “yeah, we need to find a solution” when asked directly if he supported exempting PPP loans.

According to the Tax Foundation, Minnesota is the only state in the upper Midwest that has yet to exempt forgiven PPP loan income from state income taxes.