NJBIA President & CEO Michele Siekerka, Esq.
NJBIA President and CEO Michele Siekerka issued the following statement regarding today’s announcement of an agreement between Governor Murphy and legislative leadership to expand the base of those will pay the state’s gross income tax rate from 8.97% to 10.75%.
“This tax increase in exchange for suggested middle-class relief is a gimmick that further verifies what we have said all along – increased taxes were always completely unnecessary as part of the FY2021 budget that already includes billions in bonding.
“We note that the relief tied to this tax increase is undermined by other non-budget hikes for tolls and gas and other proposed taxes in the budget. Our taxpayers need real tax reform that includes property tax relief, while this does not really improve our overall affordability crisis or remove us from the edge of our fiscal cliff.
“It does not get to the root causes of our lost $24 billion in net adjusted gross income over a 12-year span. It incentivizes those who can live anywhere and work remotely, to leave New Jersey.
“Governor Murphy’s budget also calls for a corporate business tax (CBT) increase that would give New Jersey the highest CBT rate in the nation in 2021. Perhaps our policymakers honestly believe that our state can simultaneously be an extreme outlier in both CBT and top income tax rates and expect to attract top talent and businesses from around the country. We wholeheartedly disagree.
“Additionally, we are still encumbered with a proposed budget that calls for $4 billion in unnecessary bonding that will worsen our untenable debt load. This budget includes no economic stimulus or path to job creation. There appears to be no appetite to fix an unsustainable pension system through reforms. There is no holistic policy to cure what ails New Jersey. There is seemingly only the will to tax, spend and bury our job creators while they’re down.
“New Jersey deserves much better from our governor and legislative leadership.”
NJBIA should provide some numbers behind this statement for NJBIA members and the Gov. – “ It incentivizes those who can live anywhere and work remotely, to leave New Jersey.”
For example, an owner of a NJ LLC (married filing joint, schedule C) that can work remotely indefinitely, today works from NJ home and pays X Dollars (avg NJ property tax on avg priced NJ homes) and pays Y Dollars in NJ income taxes for every $100K of income. Today that person pays a total of Z dollars to NJ.
Tomorrow, the owner sells NJ house, dissolves the NJ LLC and purchases a NC house and forms a NC LLC.
The total dollars that NJ will loose in income tax only (but not in property tax, at least until the buyers from NY keep coming) will be $N.
The total dollars that the NJBIA member will gain with lower NC property and income taxes will be $M.
I think NJBIA members should have this data …