NJBIA’s Government Affairs team was at the Statehouse on Saturday monitoring the state budget negotiations and continuing to press our case for spending cuts, rather than tax increases in the FY2019 budget.
The agreement that was reached Saturday night is disappointing because it balances the budget on the backs of the business community, giving New Jersey among the highest corporation business taxes in the nation. An 11.5 percent CBT would be the highest in our region and second nationally to Iowa’s 12 percent rate, which is set to decrease in the coming years.
Although only the broad outlines of the agreement were revealed at the governor’s news conference Saturday evening, it appears the budget legislation will also contain provisions pertaining to combined reporting, repatriation of foreign dividends and an increase in the gross income tax (10.75 percent) for those earning more than $5 million. Once the bills are written and all the details are provided, NJBIA will be reviewing them closely for the impacts on our members.
Without real structural reforms this is merely a Band-aid to our state’s fiscal deficit. This same bad scenario will continue to occur every year until structural reforms such as public employee pension and health benefit reforms are addressed. New Jersey’s business community, which employs millions of residents, will be faced with the same reflexive impulses to raise taxes year after year. This will not create a strong business climate to grow jobs and invigorate our innovation state.
We urge legislators and the governor to address the comprehensive reforms that are needed in the weeks ahead.
The Legislature will be meeting at 8 a.m. tomorrow morning and there will be no shutdown of government services or facilities this weekend.
We will continue to keep you apprised of any new developments.
If you have any questions, please contact Chrissy Buteas at email@example.com.