Minneapolis/St. Paul commercial tax rates result in business growth
The Minneapolis/St. Paul area is a hotbed of activity that not only helps us make a name for ourselves in the Midwest, but also puts us on par with other more populous areas. For example, our budding tech industry, high residential multi-tenant occupancy rate and heavy concentration of financial services rivals those in San Francisco. This is especially important considering the property tax environment in San Francisco is relatively more cost prohibitive on a dollar per square foot basis. Minneapolis/St. Paul is becoming an alternative hub for additional business growth, despite Minnesota having the ninth highest effective commercial tax rate for taxes payable in 2017.
Although Minnesota’s commercial property tax rates have continued to trend above national averages, it’s a different story on the residential side. Residential and multi-tenant property owners continue to benefit from some of the lowest property tax rates in the country. This leads commercial property owners to consider subsidizing residential property tax. We’re not alone. According to the Lincoln Institute’s 50 State Property Tax Comparison Study, 45 of 53 cities studied give preferential treatment to residential owners.
Minnesota is poised for additional business growth in the manufacturing industry, due to our property tax exemptions on business personal property and inventory. These exemptions offer industrial property owners tax rates that fall below national averages, which is especially beneficial for our local industrial property owners for manufacturing machinery and equipment.
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