ST. PAUL, Minn. (AP) — Minnesota city and county governments have a good reason to wait until after the holidays to do any major shopping: Starting Jan. 1, much of the stuff will be tax-free.
State lawmakers exempted most local government purchases from the state's 6.875 percent sales tax beginning in the new year. Collectively, it'll save cities and counties tens of millions of dollars each year. The months of lead time caused some local leaders to postpone big equipment purchases and let supplies run lower than normal.
Gravel, road salt, paper clips, phone service and fire trucks are some things no longer taxed.
The tax will still apply to items bought for public golf courses, marinas, liquor stores, and other government-owned enterprises because they can compete directly with private businesses.