Record spending and a return to pushing tax hikes, that is the unfortunate reality of New Jersey Governor Phil Murphy\u2019s budget proposal.<\/p>\n
Just last year, New Jersey\u2019s excessive corporate income tax surcharge was finally allowed to expire \u2013 as was the original sales pitch when the surcharge was first enacted. The state\u2019s rate was the highest among the 50 states with the surcharge in place.<\/p>\n
Proving the axiom that there is nothing more permanent than a temporary tax, the corporate tax surcharge is rising from the grave this session. It is an even worse time for the tax to be reimplemented as businesses and taxpayers continue to flee the state, and neighboring Pennsylvania has already started its path to cutting their corporate tax rate down to 5.99%.<\/p>\n
Hiking business taxes now will put New Jersey an an even more uncompetitive situation than before.<\/p>\n
The governor\u2019s budget also includes a \u201ctruck traffic excise fee\u201d that would cost $10 million annually. This would drive up the cost of shipping, impacting the price of everything that gets trucked through New Jersey, all at a time of high, persistent inflation.<\/p>\n
The tax hike binge comes despite Murphy\u2019s promises to \u201cnot raise taxes\u201d and claims he was done raising taxes while he was campaigning for a second term.<\/p>\n
The tax hikes are to fuel Murphy\u2019s budgets that have increased state spending by 60%. Despite the proposed tax hikes the state would still face a structural deficit.<\/p>\n
The governor\u2019s budget proposal outlines a series of dangerous maneuvers that, at best, could be seen as creative accounting.<\/p>\n
Central to the controversy is the manipulation of New Jersey\u2019s Debt Defeasance and Prevention Fund, a reserve established in 2021 aimed at reducing the state\u2019s bonded debt, which had swelled to a staggering $48 billion. Originally intended to retire existing debt and fund capital projects without resorting to new borrowing, the fund represents a prudent approach to managing the state\u2019s obligations.<\/p>\n
However, the Murphy administration\u2019s latest budgetary sleight of hand involves diverting nearly $600 million from this off-budget, debt-relief account to the general fund. This move, which effectively frees up these funds for any purpose, flies in the face of the fund\u2019s original intent, which was to provide a dedicated source of revenue for debt relief and capital projects, thereby saving taxpayers money on interest payments.<\/p>\n
The Governor\u2019s proposal does not merely stop at fund reallocation. It boldly asks the Legislature to increase annual spending to nearly $56 billion, significantly outstepping projected tax revenues by almost $2 billion. This gap highlights a long-standing trend under the Murphy administration of escalating spending without a corresponding increase in revenue.<\/p>\n
The administration has proposed new debt prevention initiatives and other spending increases, including substantial increases allocated to state infrastructure and public services. This funding comes at a time when the state faces a $1.8 billion structural deficit, raising concerns about the sustainability of these expenses.<\/p>\n
The budget also includes more property tax \u201crelief\u201d plans that amount to sending checks to people \u2013 spending \u2013 and ignoring underlying property tax burdens that rank among the worst in the nation.<\/p>\n
Unfortunately, careless spending is nothing new, as Governor Murphy\u2019s first term featured growing budgets and annual tax hikes. During his first term, he managed to fuel a nearly 34% increase in the state\u2019s budget, supported by an automatic property tax increase. Murphy has enacted over $2,778,000,000 in tax hikes \u2013 not including the $1,229,000,000 increase he proposed but never got enacted.<\/p>\n","protected":false},"excerpt":{"rendered":"
New Jersey Governor Phil Murphy’s budget proposal includes record spending and a return to pushing tax hikes. The proposal also involves reinstating a corporate tax surcharge, implementing a truck traffic excise fee, and diverting funds from a debt relief account. Despite promises not to raise taxes, the governor’s budget would still face a structural deficit. Governor Murphy’s first term also featured growing budgets and annual tax hikes.<\/p>\n","protected":false},"author":6,"featured_media":7851,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"Default","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[1521,5800,1766,4223,4029,186,1002,2577,3681,4498,4919,898,3644,121,2658,304,2110,5098,2294,3398,1823,67,899,2628,6061,5838,5402,284,4340,4671,5051,5612,5614,1806,796,3480,6062,3897,1065,4222,4343,4556,3912,4185,1183,459,4682],"class_list":["post-7850","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-other","tag-1521","tag-americans","tag-budget","tag-budget-proposal","tag-budgets","tag-business","tag-checks","tag-concerns","tag-corporate-income-tax","tag-corporate-tax","tag-corporate-tax-rate","tag-debt","tag-expenses","tag-featured","tag-fuel","tag-funding","tag-funds","tag-governor","tag-income","tag-income-tax","tag-increase","tag-inflation","tag-interest","tag-money","tag-new-jersey-governor-phil-murphy","tag-price","tag-projects","tag-property","tag-property-tax","tag-proposal","tag-raising-taxes","tag-revenue","tag-revenues","tag-services","tag-shipping","tag-spending","tag-state-spending","tag-sustainability","tag-tax","tag-tax-hikes","tag-tax-increase","tag-tax-rate","tag-tax-reform","tag-tax-revenues","tag-taxes","tag-traffic","tag-truck"],"acf":{"keyphrase":"","keywords":"","sourceimg":"","country-category":""},"yoast_head":"\n