Among Gov. Tim Walz’s roughly $66 billion budget is something he says has never been done in Minnesota: cut the state’s sales tax. 

“For the first time in Minnesota history, reducing the sales tax and those are things that are going to impact people directly,” Governor Walz said while laying out his vision for the budget. 

RELATED: Reducing statewide sales tax, expanding tax base included in Walz’s proposed budget plan

He wants to cut the statewide sales tax by 0.075% — which is $0.075 on a $100 purchase — moving it to 6.8% from 6.875%.

Walz says a main driver is the tariff plans President Elect Donald Trump has on the country’s biggest trading partners. 

“Tariffs will basically function as a national sales tax that will come on to you,” Walz added. “And what we’re doing is, let’s make the first move on this, reduce Minnesota sales tax. Let’s make it fair.”

Economic professor with the University of Minnesota, Timothy Kehoe, spoke with 5 EYEWITNESS NEWS about the governor’s plan. 

“I see that the numbers just don’t add up,” Kehoe said about the plan to compensate consumers with the sales tax cut.  

Kehoe says if Trump follows through, consumers will feel the expected price increase far more than the savings from the proposed tax cut. 

“It calls attention to an issue, but it doesn’t solve it,” Kehoe added. 

Another part of Walz’s tax plan in his budget proposal would expand the sales tax to certain services — including services provided by lawyers, stockbrokers, and accountants — that don’t currently have it, which Walz calls a “loopholes.”

“We definitely have some concerns about the full totality of the plan,” Brian Cook, director of tax, fiscal policy and elections for the Minnesota Chamber of Commerce, said.

“We’re hearing a lot from our member companies and our customers across the board, but especially in [those] industries, to that costs really matter, and proposals that can increase costs, such as this, are pretty concerning,” Cook said. 

Pushback from Republicans has already been shared — leadership in both the House and Senate have expressed disdain and made it clear any tax increases are off the table. 

Lawmakers will still have their say in how the budget is shaped, plus Walz’s proposal is likely to be revised after a new revenue forecast is shared next month.