The Transportation Sales Tax was approved by the Brown County Board to help fund road, bridge and transit projects within the County. The approximately $1.5 million expected to be raised annually will be used for potential projects identified in an Implementation Plan to improve safety and support economic development throughout the County. By Board resolution, the local sales tax will be collected until sufficient funds are available to construct the CSAH 29 project identified. A Resolution was passed on December 20, 2022 authorizing the continuation of a .5% sales tax until sufficient funds are available to construct the fifteen projects identified in that resolution.
The Minnesota Department of Revenue will administer the .5% local transportation sales tax. This tax applies to the same items that are subject to the State Sales and Use Tax of 6.875%, thereby making the sales tax rate in Brown County 7.375%, plus any other applicable local taxes. For example, a purchase made in the city of New Ulm on April 1, 2016 would be subject to a 7.875% sales tax, which includes the .5% New Ulm local tax.
To learn more, click on the links or review the information in the “Frequently Asked Questions, sections below:
- Transportation Tax Implementation Plan (PDF)
- Brown County Resolution (PDF)
- Brown County Continuation Resolution (PDF)
- M.S. 297A.993 & M.S. 297A.99 (Link - PDF)
- Informational Meeting Handout (PDF)
- State of Minnesota Sales and Use Tax Information (Link)
- MN Revenue Sales Tax Rate Calculator (Link)
- Brown County 0.5 Percent Transit Sales and Use Tax General Notice (PDF)
FREQUENTLY ASKED QUESTIONS
Why is the County Implementing a transportation sales tax?
Brown County’s transportation infrastructure forms the backbone of the county’s economy and has a direct impact on future economic development. The Road & Bridge Construction plan identified a shortfall of over $25.9 million from 2016-2020, and $25.8 million in County Local Option Sales Tax funding needed for the 2023-2032 Ten Year Road & Bridge Construction Program. The .5% sales tax for transportation collected in Brown County will stay in the county.
Why raise the money through a sales tax?
The revenue projected from the transportation tax is projected to be $1.5 million annually. If this cost was funded entirely through property taxes it would force Brown County property owners to foot 100% of the costs even though many non-residents and renters travel on our road network. To collect the money through a sales tax means that a percentage of the cost will be paid by the people who drive in our county to work, visit and shop.
I’m a business owner. What do I need to know to collect this tax?
The Minnesota Department of Revenue will send an informational letter to all businesses in the County. To calculate the total tax due on a purchase:
- Add the 6.875% state sales tax rate and the .5% Brown County transportation rate.
- Apply the combined 7.375% rate, plus any other local taxes that apply, to the sales price.
- Round the total to the nearest full cent.
For additional assistance in determining the state and local general sales and use tax rate, you may utilize the Minnesota Revenue Sales Tax Rate Calculator.
How do I know this money will really go toward transportation projects?
The state legislation that enabled counties to enact a sales tax requires the revenue raised to be used specifically for transportation-related projects. Brown County has developed a transportation plan and will invest the tax revenue in the potential projects identified in the plan.
When will the plan do into effect, and when will I see projects paid for by it?
The tax goes into effect on April 1, 2016 and the county will begin sales-tax funded projects in 2019.
When will it end?
Brown County has plans to continue with the sales tax until sufficient funds are available to construct the project(s) identified.
Where will the Transportation Sales & Excise Tax be applied?
The county’s .5% sales tax applies to the same items that are subject to the State Sales and Use Tax with the exception of sales of motor vehicles registered for road use. The state motor vehicle sales tax will be unchanged at 6.5%. The use tax applies to taxable items used in the County if the local sales tax was not paid at time of purchase. Individuals who owe use tax, but are not required to hold a sales tax permit, can file a use tax return annually, regardless of the total amount of purchases. These returns are due by April 15 of the following year and are often filed with state income taxes. For more information on the use tax, visit the State of Minnesota Sales and Use Tax Information webpage.