Tax Cut Plans In Jeopardy As NJ Revenues Sag [AUDIO]
Governor Chris Christie, the State Senate Democrats and the Assembly Democrats all have competing tax cut proposals, but if the state doesn't have enough money to support any of them they could all be dead.
The State Treasurer reported a $230 million revenue shortfall early this week and another $121 million shortage was reported Wednesday. Christie's $32.1 billion proposed budget relies on 7.3% revenue growth.
Christie proposes to reduce personal income tax rates, across-the-board, for every New Jerseyan, by 10% with the three-year phase-in of the cut with this budget. He says 10% tax cut for every working New Jerseyan will help families to keep more of what they earn and make the state more competitive with other states and attract more new jobs to New Jersey.
Asked if the bleak new revenue picture means Christie's plan is dead, Senate Budget Committee chairman Paul Sarlo says, "I don't think it's dead. I believe the Governor is still out there pushing it out there, but he's going to have to be responsible."
The Senate Democrats proposal would provide a property tax relief credit through the gross income tax return, for all residential homeowners with incomes up to $250,000 in the amount of 10% of the first $10,000 in property taxes paid.
Sarlo won't say that plan is dead either. He points out that it is the Governor and the Treasurer who certify revenues and, "Once they certify the revenues then we will ultimately decide what should be in (the State Budget) and what shouldn't be in…….If the revenues are such that a tax cut plan doesn't work I'm going to be vocal about it."
Right now, Sarlo is not optimistic about revenues and feels more bad news about a deficit is coming. He explains, "I think, in my discussions with the Office of Legislative Services, for the two fiscal years combined it could be a billion dollars." He thinks cuts in the current budget will have to be made.
"Last year they (Sarlo and Assembly Majority Leader Lou Greenwald) put $816 million in additional spending in the state budget and had no tax revenues to pay for it. They knew their numbers were fake and they sent it to me anyway purely for politics" Christie said Wednesday during a Town Hall meeting.
Even though April tax collection revenues are down and are increasing at half the rate necessary to meet the governor's 4.8% projected growth this year, Christie turned the focus of his town hall to Sarlo and Greenwald.
The Governor said, "These same jokers are back now…they want us to trust them on their revenue numbers..and its coming from the same people who last year were completely wrong and wanted to inflate the budget over $800 million with no way to pay for it."
The Assembly Democrats property tax cut plan works the same way as the Senate's proposal, but would provide a 20% savings and be partially funded by a millionaires tax increase which Christie has already vetoed twice and vows to veto again.