"That’s a no-brainer.

Monday, March 19, 2001

"That’s a no-brainer." So said state Sen. Anthony Kinkel (DFL-Park Rapids) about the proposed exemption of military personnel from state income tax. Several bills are before the Minnesota Legislature that in various ways would affect how this state taxes those in the military. Minnesota residents in the armed forces serve and protect us in this state as well as the nation, and our state Legislature should make reasonable provision both to respect and reward them.

Testifying before the state Senate tax committee in support of four such bills, I watched as Kinkel almost unbelievingly asked fellow committee members: "Why in the world would we tax them?" He referred specifically to those on active duty and serving outside the state, as most do. "We handle their absentee ballots, give them driver’s licenses and register their cars. But that’s about all we do for them."

As I pointed out to the committee, these people seldom drive our roads but we charge them for maintenance. Our police and firefighters do not protect them, but we charge them as if they do. The least we can do is to exempt them from income tax. They will still pay property tax for schools even though their children attend out of state. Inasmuch as they are not present to participate in the political process, it is something like "taxation without representation."

Moreover, it is very much to the benefit of the state for us to relieve them of this tax. If we can encourage them to maintain a Minnesota residence, we receive federal funding to use ourselves in a host of projects – even though they are not here to share the benefits of the money they send our way.

Retiring as young as age 37, they have remaining at least 30 additional years of productive service, which could be spent here helping us. Their learned technical and leadership skills – which cost us nothing – are much needed by our industries, governments and communities. We birthed and reared them and want them back. The state cannot afford this drain on native talent.

Families have sacrificed their presence for the good of the country, and they want them home at retirement. A mother whose son or daughter becomes career military is not going to see much of her grandchildren during their childhood and longs to receive them back in their 20s.

However, our military families just are not coming home. Their terminal duty station is often in one of the 43 states that do exempt them, and it is most convenient just to stay there. When sailors live several years in Florida, soldiers in Texas, and airmen in Arizona, it isn’t Minnesota weather that will pull them back. Even if they like our winters, they can have the same in one of the tax-free states next door.

If we exempt all or a portion of retired pay – also appropriate – they will still have well paying civilian jobs that we will surely tax as only Minnesota can tax. Other bills before the Legislature do address retired pay. Those of us retired here, draw on state benefits but studies demonstrate we cost tax payers far less than the typical citizen. One reason, of course, is the federal provision for such as medical care. Military retirees do not go on welfare.

Present retirees spent all or most of their careers in the armed forces when pay was at its lowest, and even the retired pay is locked into these low levels. Relief from state income tax would help them to catch up as well as being a state contribution to compensate for the hardships and dangers of military service.

Other bills address income tax relief for current members of the reserve components of the armed forces. These already pay full tax on their civilian incomes, and a break here would encourage them to be prepared and available for deployment in national emergencies. Such would be nothing less than meeting the World War II challenge, "Do your part."

Forty-one states entirely or partly exempt military pay from their income tax. They treat our service people better than we do. Minnesota now has the opportunity to honor its military people in a most practical way and by the same means win them back to ourselves. The Legislature must do something significant this session; let’s encourage them in this opportunity.

Wallace Alcorn’s column appears Mondays.