New Jersey Governor Says Tax Cuts are Coming This Year

By Brent Johnson, nj.com (via TNS).

As he prepares to unveil his new state budget proposal next month, Gov. Phil Murphy is promising New Jerseyans will see “absolutely no new taxes” as well as “significant tax cuts.”

The Democratic governor also says he wants to renew a property tax relief program installed last year and will let a surcharge on the state’s corporate business tax expire.

During an interview with Bloomberg TV on Thursday, Murphy was asked if he can pledge no new taxes in New Jersey, the same way New York Gov. Kathy Hochul, a fellow Democrat, did during a speech earlier this week.

“One hundred percent,” Murphy replied. “In fact, you’re gonna see significant tax cuts.”

Murphy noted how he and state leaders last year implemented a property-tax relief program called ANCHOR in which homeowners and renters can apply for rebates in New Jersey, the state with the nation’s highest property taxes. The governor announced during his State of the State speech Tuesday that the deadline to apply has been extended to Feb. 28.

“We’re looking at other tax cuts,” he added during Thursday’s TV appearance. “We’re not gonna relent. But absolutely no new taxes.”

Murphy did not specify when the tax cuts would take place, but he is scheduled to deliver his state budget speech next month. He and leaders of the Democratic-controlled state Legislature will then negotiate a final budget for the fiscal year 2024 that must be signed by July 1.

Asked by NJ Advance Media on Friday for more detail on what tax cuts the state could see, Murphy said he is “committed” to continuing to fund the ANCHOR rebates.

“The ANCHOR relief program is like school funding, it’s like making the pension payment — it’s not a one-and-done,” he said after an unrelated event in Trenton. “You’ve got to keep doing that every year, and I’m committed in our budget that we’re gonna continue to do that.”

Murphy also said he will stick by an agreement to let an increase in New Jersey’s corporate business tax expire.

In his first term, Murphy and top lawmakers extended a 2.5-percentage point surcharge on the corporation business tax for companies in New Jersey with more than $1 million in profits. The 11.5% top tax rate is scheduled to sunset in December of this year.

“I’m on the side that a deal’s a deal,” he said Friday. “We committed that would lapse and go away. That’s where I am as we speak.”

There are already arguments about that decision.

The left-leaning think tank New Jersey Policy Perspective said letting the surcharge end amounts to a $600 million tax cut to some of the state’s biggest and most profitable corporations and will blow a hole in the state budget.

“This represents the absolute worst of trickle-down economics,” said Nicole Rodriguez, the group’s president.

State Sen. Paul Sarlo, D- Bergen, chairman of the Senate budget committee, welcomed the governor’s stance, saying “it’s important that we keep our promises so the business community can plan and operate with certainty.

“Removing the surcharge will provide tax relief that will help fuel the economy and continue to ensure that New Jersey is an affordable place to operate,” Sarlo said.

This all comes as some Democratic lawmakers may have no appetite for tax increases as they seek re-election this fall. All 120 seats in the Legislature are on the ballot in November.

Republicans are seeking to regain control of the body for the first time in 20 years. The party gained seven seats in 2021, and Murphy and Democrats responded by vowing to make New Jersey affordable.

Republicans have long criticized Murphy for hiking taxes to increase government spending and have accused him of not doing enough to help provide economic relief to residents and businesses.

“The governor and the Democrats are more interested in protecting and expanding government programs and less interested than we are in protecting your money and your family’s way of life,” state Assembly Minority Leader John DiMaio, R- Warren, said after Murphy’s State of the State speech Tuesday.

The governor‘s tax remarks this week come after he said during a speech to the South Jersey Chamber of Commerce on Wednesday that he expects a “short-lived recession.”

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