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Saying it will make it harder to compete with New York City for new jobs, NJBIA Wednesday night urged the Jersey City Council not to impose a payroll tax on employers.

Testifying on City Ordinance 18-133, NJBIA Vice President Frank Robinson said the business community understands the importance of funding education, but this ordinance would impose new burdens on businesses of every size.

“Many companies courted by Jersey City have made significant capital investments, including adding employees,” Robinson said. “This payroll tax will effectively chip away at the competitive advantage Jersey City has established as a lower cost alternative when compared with surrounding states and specifically New York City.”

Newark is the only municipality in New Jersey that is authorized to levy an employer payroll tax. This ordinance would allow Jersey City to do the same. Legislation (A-4163) signed into law earlier this year would allow for collection of up to 1 percent on employees’ wages to help offset the loss of funds under reforms to the state’s school funding law.

In recent months, NJBIA has worked with the Partnership for Jersey City, a diverse coalition with representatives from business, unions and a number of trade associations all opposed to the employer payroll tax. The association has also met with a number of members of the Jersey City Council to convey how an employer payroll tax would increase the cost of doing business on both small and large businesses, as well as entrepreneurs in Jersey City.

At the public hearing, Robinson also urged council members to consider that businesses are already dealing with a surcharge in the corporate business tax that was enacted as part of the state budget, as well as new labor and energy mandates.

“These aggregate costs will directly impact employers in Jersey City,” Robinson said.

Taxation & Economic Development News

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