Gov. Tim Walz is pitching his first budget under the new Trump era as a counterweight to the incoming president’s threats to impose tariffs, which he says will raise costs on everyday Minnesotans. His plan would lower Minnesota’s sales tax rate for the first time in state history by .

Minnesota Gov. Tim Walz called for spending cuts Thursday in a $65.9 billion two-year budget proposal that includes a modest reduction in the overall state sales tax but new taxes on services like legal and financial advice.

Gov. Tim Walz on Thursday pitched a tighter two-year budget, complete with spending pullbacks and other measures to keep a potential deficit at bay. He also proposed a lower state sales tax rate but called for extending the tax’s reach to financial services.