If someone told us in 2019 that there would come a day when New Jersey would be flush with cash, we wouldn’t have believed them. But that day has come, due to an influx of federal stimulus funds related to the pandemic as well as a surplus from higher-than-expected tax revenues.
While the good news is the lack of new fees or taxes in the proposed budget, the bad news is that spending will increase to nearly $49 billion. This level of spending cannot be sustained, as most experts are predicting a slowing down of our economy.
The Legislature and Gov. Phil Murphy need to take advantage of this unique circumstance and reduce spending while allocating more dollars to pay down debt. Both actions will help grow our economy and overall recovery as we face uncertain times due to the rising costs of goods and services, supply chain issues and rising interest rates.
Trenton should also seize the moment to support our businesses and employers by cutting the corporate business tax rate, streamlining regulatory burdens and replenishing the Unemployment Insurance trust fund by using our surplus.
Businesses recovering from the economic toll of the pandemic are now grappling with the rising costs of goods and services across the board. The strain this puts on the business community is not sustainable, and relief is needed now.
A suspension, even for the summer months, of the motor fuels tax would provide relief not only to businesses, but to residents across New Jersey.
The Commerce and Industry Association of New Jersey also urges the Legislature and the governor to focus on programs to help our employers find and recruit new talent. Steps should be taken to increase grants and loans to businesses to train and recruit new talent and to work with our higher education community in assuring that tomorrow’s workforce has the skills needed to succeed in business.
When you add the $10 billion the state received from the American Rescue Plan Act to the $13 billion that has been allocated to New Jersey from the Infrastructure Act, and the estimated $6 billion surplus projected in this budget, now is the time to roll back taxes, which will stimulate our economy, resulting in new investment for New Jersey and position us to succeed for years to come.
Anthony Russo is president of the Commerce and Industry Association of New Jersey.