If parts of tomorrow’s speech by Gov. Phil Murphy sound familiar, it’s because you’ve heard it before. He will again call for a millionaires tax in the third State of the State address, just like he did in the first and second State of the State speeches.
“Heading into his third year as New Jersey’s governor, Phil Murphy is set to appeal again for a tax boost on millionaires and retail sales to help fund his progressive wish list for 2020,” wrote Bloomberg reporter Elise Young.
The annual State of the State speech, which is scheduled for 3 p.m. tomorrow, is a chance for governors to outline their priorities for the year and propose big-picture policies. Higher taxes on the wealthy have been one of Murphy’s priorities since taking office.
Legislative leaders have not been quick to jump on board. They went part of the way in Murphy’s first year, creating a new 10.75% income tax bracket but applied only to income of $5 million or more. Murphy proposed extending that rate to income of $1 million or more in last year’s speech, but the Legislature did not raise any broad-based taxes as part of the current fiscal year’s budget.
“The millionaires tax, the sales tax – none of this stuff gets to what you need,” Senate President Steve Sweeney told Bloomberg. “I want to fix things, and raising taxes is not the magical mystery carpet that we’re all going for a ride on.”
NJBIA has consistently opposed a millionaires tax because of its impact on small businesses. Companies organized as LLCs, partnerships and S corporations pay their business taxes through their personal income taxes.
As NJBIA President and CEO Michele Siekerka explained, a tax increase of that magnitude on top of new laws like the $15 minimum wage and new paid leave mandates would hurt employers who are the backbone of New Jersey’s economy.
“We already start as being last in the region when it comes to the cost of doing business and the cost of taxes, and you pile on more mandates – so you’re not just last and you’re not just an outlier, but you become an extreme outlier,” Siekerka told Young in a telephone interview.