Credit Minnesota’s growing economy for its record state budget surplus

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Dec. 7—Minnesota’s projected $7.7 billion state budget surplus is a sign that “the state’s economy is emerging at a good pace,” state Management and Budget Commissioner Jim Schowalter said Tuesday during a news conference on a new financial forecast.

Minnesota’s economy is growing because the U.S. economy is recovering from the recession triggered by the COVID-19 pandemic last year, and the state’s economy reflects national trends, State Economist Laura Kalambokidis said during the briefing.

HIS Markit, the state’s macroeconomic consultant, forecast the national economy will grow 5.5 percent this year, decelerate to 4.3 percent in 2022 and average 2.7 percent growth in the following three years.

Minnesota’s economic growth is “consistent with what we’re seeing in other states,” Kalambokidis said, although the state’s tax system, relying heavily on income, sales and corporate taxes, is better devised than most to capture revenue from “extraordinary…

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