A budget was passed in both the state Senate and the General Assembly on Thursday, but it is expected to be vetoed by Gov. Phil Murphy.
Here is some reaction to the budget passing.
Michele Siekerka, CEO and president, New Jersey Business & Industry Association
“NJBIA understands the great challenges in putting forth a state budget that fulfills different obligations and priorities. The budget passed by the Legislature, however, continues the concerning course of damaging tax increases that will further challenge New Jersey’s affordability and competitiveness, rather than setting a path for long-term, sustainable solutions to our fiscal challenges.
“The corporate business tax surcharge as part of the Legislature’s budget puts New Jersey in line for the highest corporate income tax rate in the nation. This will only incentivize our larger corporations and leading job providers to either expand their operations elsewhere or prevent them from growing in state.
“We remain equally concerned about Gov. Murphy’s proposal to raise the income tax on millionaires and a sales tax increase, which would also cause our affordability and competitiveness to further decline.
“With only a short time before the June 30 budget deadline, we urge all of our policymakers to focus on a budget of austerity that will fix our structural budget deficits instead of continuing the unsustainable practice of trying to tax our way out of New Jersey’s fiscal challenges.”
Gordon MacInnes, president, New Jersey Policy Perspective
“Once again, the Legislature has passed a patchwork budget that fails to meet New Jersey’s long-term needs.
“Out of all the options on the table, the budget forgoes long-term, sustainable sources of revenue, and instead depends on a temporary increase in the corporate business tax. There is danger in relying on this tax for the lion’s share of new revenue as, among major taxes, it is the most volatile source of state funding. That danger is compounded by hundreds of millions of dollars in phantom cuts, ‘savings’ from yet-to-be performed audits, and accounting tricks that have defined New Jersey’s budgets of the past.
“With this budget, the Legislature has missed an opportunity to turn the page on decades of short-sighted decisions that have plagued the state’s finances and endangered its future.”
Assemblyman Kevin Rooney (R-Wayne)
“New Jersey is unaffordable for people and businesses, and the budget Democrats passed today doesn’t address that. The fewer jobs, slower wage growth and higher prices residents will have to pay because of these tax hikes will only make living here more difficult.
“We heard calls from Democrat leadership on cutting spending and tax increases as a last resort, but they still passed a budget that will increase taxes by $1.2 billion — mostly on businesses that will have to pay the highest taxes in the nation.
“There isn’t a clearer example of the folly of raising taxes to support spending than the corporate business tax. Seven of the last 10 years CBT revenue has gone down, and state spending increased. We can’t control our revenue, but we can control spending. Hiking business taxes to the highest rate in the nation only follows that misguided philosophy. To make the state more affordable, the budget needs to become more affordable.”
Regina Egea, president, Garden State Initiative
“We need look no further than up I-95 to Connecticut to see what the failure to confront our cost of government and crippling debt will lead to: anemic growth when the majority of the nation is booming, growing per capita debt, an outmigration of our best and brightest talent and the departure of good-paying jobs and businesses. According to the business leaders GSI interviewed just this past spring, New Jersey is discouraging new talent from taking executive positions located here, and our current workforce is being diluted by the highest-skilled individuals taking jobs in other states with a more positive economic outlook.
“The Legislature’s budget, while temporarily satiating our government’s appetite for spending, will push New Jersey well beyond the tax rates of our neighbors and competitor states.
“Many companies have taken the benefits of the federal corporate tax rate reduction to 21 percent to invest in their businesses and expand their operations. Several states like Iowa sensed opportunity and moved to lure those investments by reducing their own corporate and income taxes. Iowa’s statutory reduction of their corporate tax rate to 9.8 percent in the coming years gives employers confidence that the state is serious about economic growth.
“This ‘tax-first’ budget sends a clear message that the Legislature is indifferent to what it will take to make New Jersey competitive again and continues our state down a dangerous path already plowed by Connecticut.”
