News that DFL Governor Mark Dayton will rescind his plan to extend sales tax to professional services in Minnesota was applauded by many in the business community. Speaking to the Pioneer Press, Walt Pickhardt said a statement the state issued about the proposed tax structure "took a simplistic approach" to how the new tax would have been implemented.
The original proposal would have imposed a tax on legal services only where those services are received, but Pickhardt said billing for work touching multiple states would have been a logistical challenge. Clients would have to be billed at different rates if meetings to complete a deal were held in multiple states including Minnesota. "There would have been an incentive for companies to hire an attorney in another state, just to avoid the problem," Pickhardt said.