Walz unveils 2026 supplemental budget focused on affordability, workforce adapting to AI and taxing tech companies
Publish Date: 2026-03-17 14:16:00
Source Domain: www.kare11.com
The proposal includes a mix of tax credits, a first-of-its-kind state sales tax cut and new levies on tech companies.
ST PAUL, Minn. — Gov. Tim Walz on Tuesday released his 2026 supplemental budget proposal at the St. Paul Eastside YMCA, outlining a plan he said is aimed at lowering costs for middle-class families, helping workers navigate disruptions tied to artificial intelligence, responding to Operation Metro Surge and maintaining Minnesota’s record of balanced budgets.
Under the proposal, the state would cut $370 million in spending in fiscal year 2029 and reduce the structural deficit by nearly 20%. By slowing the growth of programs that have been major drivers of increased spending while minimizing impacts on eligibility and service levels, the administration projects a $1.8 billion balance for fiscal years 2028-29.
“As families see higher prices and more economic uncertainty, we’re proposing legislation to make everything from child care to housing, to property taxes more affordable for middle-class families,” Walz said. “This is a fiscally responsible plan that cuts spending to maintain a balanced budget while preparing our economy and our workforce for the challenges of artificial intelligence.”
Lowering costs for families
The budget includes a series of measures to ease household expenses. Walz proposes offsetting rising child care costs through refunds and an expansion of the Dependent Care Tax Credit. The changes would benefit an estimated 104,800 families with young and school-aged children by increasing the maximum allowable expenses by $3,000 for one child and $6,000 for two or more children under age 5.
Housing-related investments include $33 million for permanent supportive…
