NJ Business Tax Breaks Getting Attention
A coalition of liberal groups on Thursday called on New Jersey to raise its corporate taxes as a way to offset the cost of the state’s growing use of subsidies to lure businesses and also help balance the state government’s budget.
Working Families United for New Jersey, along with the state chapters of groups including the NAACP, National Organization for Women and the Sierra Club, did not offer a specific rate or say how much an increased tax should bring in.
The group made the call in light of an analysis from the liberal think tank New Jersey Policy Perspective that showed New Jersey has awarded $4 billion in business subsidies since the month Christie took office, nearly three times as much as it awarded from 1996 through 2009.
Since December alone, the state has awarded more than $1 billion in incentives to companies pledging to bring more than 11,000 permanent jobs to the state, keep 7,700 jobs in the state and create more than 8,000 construction jobs.
Those incentives came through a 2013 law — signed by Republican Gov. Christie but championed by some legislative Democrats — to retool what the state can offer employers. Under the law, the subsidies — awarded in the form of tax credits — are more generous than what was available previously. Some conservative groups, including the New Jersey office of Americans for Prosperity, also have criticized the tax breaks for companies as “corporate welfare.”
But at Thursday’s news conference, the criticism was directed squarely at Christie, a possible 2016 presidential candidate.
“He has made a pledge to the wealthy that they will not be harmed at all,” said James Harris, a former president of the state NAACP branch.
The groups’ tax-hike suggestion was the second suggested in two days. It’s likely to be shot down by Christie, who has said repeatedly that he opposes raising any tax rates.
On Wednesday, state Sen. Raymond Lesniak called for raising the income tax rate on those who earn more than $350,000 and at the same time eliminating an estate tax. Lawmakers have adopted similar so-called “millionaires’ taxes” three times in the last four years, and Christie vetoed each one.
Christie has said that Democrats, who control both chambers of the state Legislature, have not offered alternative ways to fill a state budget gap, projected at about $2.8 billion between now and the end of June 2015.
The governor’s solution is to cut scheduled payments to the pension funds of public workers to fill most of the gap. He cut the payments scheduled for this month with an executive order and is proposing trimming next year’s payments in his proposed state budget.
Several unions are suing to try to stop the pension cuts.
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