Saint Paul – Governor Tim Pawlenty today issued an executive order creating the Governor’s 21st Century Tax Reform Commission. The Commission will recommend tax law changes for our 21st century economy that improve Minnesota’s ability to successfully compete with other states and nations for jobs and business investments, and that promote the long-term economic prosperity of the State and its citizens.

Governor Pawlenty first announced plans to create the Commission in his State of the State Address on February 13. At that time, the Governor said, “Our current tax system reflects the economy and demographics of the 1960s. It's outdated and needs to be fixed.”

The Governor said “this Commission will specifically focus on improving our job climate by reforming Minnesota's tax laws. Job providers, entrepreneurs, private sector employees, investors, and others who actually have direct experience in creating private sector jobs will be members of this commission.”

The following is the text of the executive order:

I, TIM PAWLENTY, Governor of the State of Minnesota, by virtue of the authority vested in me by the Constitution and applicable statutes, do hereby issue this executive order:

WHEREAS, Minnesota’s goal is to be the best place in America to live, work and raise a family; and

WHEREAS, Minnesota’s long-term prosperity requires that businesses and entrepreneurs invest, remain and grow in the state; and

WHEREAS, Minnesota’s current tax system reflects the economy and demographics of the 1960s and could be improved to better support business development and investment, job growth, income generation, entrepreneurial activity, research activities and exports; and

WHEREAS, Minnesotans will benefit from an improved tax system that is simple, more predictable, and that supports a strong economy and job climate.

NOW, THEREFORE, I hereby order the creation of the Governor’s 21st Century Tax Reform Commission (“Commission”).

1. The Commission will be comprised of up to 15 members appointed by the Governor:

a. Membership on the Commission will include individuals with knowledge and experience in how state tax systems affect business location, job creation and capital investments.

b. Membership will also include representatives of the following types of businesses and individuals:

i. large and small businesses;

ii. businesses from key Minnesota industries;

iii. C-corporations, S-corporations, partnerships, and sole proprietors;

iv. suppliers of investment capital; and

v. individuals with special experience or knowledge in taxation and the economy.

c. The Governor will designate a chair.

d. Commission members will serve a two-year term, or until the Commission is disbanded at the request of the Governor.

e. Commission members will serve on a voluntary basis and are not eligible for per-diem or payment of expenses.

f. The Commissioner of Revenue and any designees will provide administrative and staff support to the Commission.

2. The Commission’s responsibilities include providing advice and recommendations to the Governor on reforming the state’s tax laws with the goal of making long-term improvements in the revenue system that reflect changes in business practices, demographics, and the economy that have occurred in Minnesota and in other states.

a. The Commission will recommend tax law changes that improve Minnesota’s ability to successfully compete with other states and nations for jobs and business investments, and that promote the long-term economic prosperity of the State and its citizens.

b. The combined impact of the Commission’s recommendations should be revenue-neutral.

c. The Commission’s recommendations should reflect principles of sound tax policy including equity, simplicity, competitiveness, efficiency, stability, and ease of compliance and administration.

d. The Commission will provide the Governor with a report of its recommendation by December 1, 2008.

3. The Commission will meet as soon as practicable following the completion of the open appointment process.

IN TESTIMONY WHEREOF, I have set my hand this 29th day of February, 2008.