Think A Millionaires’ Tax Won’t Hurt You? Think Again Says Lawmaker [AUDIO]
New Jersey has roughly 16,000 millionaires and chances are you aren't one of them which is likely the reason most polls shows the vast majority of Garden State residents support a millionaires' tax increase.
The top Republican in the General Assembly insists a millionaires' tax hike will negatively impact anyone who has a job or is looking for one.
Some top Assembly Democrats are talking about asking the voters in a 2013 ballot question if they would like to increase taxes on the state's roughly 16,000 millionaires as a means to pour hundreds of millions of dollars into the state's coffers to help the middle-class and working-poor.
Assembly GOP Leader Jon Bramnick says, "It sounds really great to raise taxes on millionaires, but the bottom line message is: when you talk about new taxes people look at New Jersey the wrong way particularly the business community."
Bramnick says New Jersey is becoming more business friendly and "we can't take that train off the track." He points out that more businesses mean more jobs and companies and employees pay taxes too, "I think it affects everyone when you start to send the wrong message to the business community around this state and around this country."
"You don't take the road to raise taxes," explains Bramnick. "You Take the road to lower the cost of government because if you don't do that no matter which tax you raise it will never be enough.""
If the goal truly is to assist those who need it most, Democrats could put the question on the ballot this November.
Governor Chris Christie has vetoed a millionaires' tax hike before and vows to do it again. In his budget address, Christie said, "We have stopped spending growth in its tracks, and we have eliminated the special surtax that for a time gave New Jersey the highest marginal tax rate in the nation - and I am proud to have twice vetoed the effort to re-introduce it. And just so there's no mistake in my intention: I will veto any tax increase again."
Democrats don't need Christie's support. They actually don't need a single Republican to vote in favor of placing a question on this November's ballot. If a resolution passes with a simple majority (21 in the Senate, 41 in the Assembly) it needs to be approved for two consecutive years before voters get their say. However if a resolution passes with a three-fifths majority in both house (24 in the senate, 48 in the Assembly) it can go on that year's ballot. A Governor cannot veto a referendum.
There are exactly 24 Democrats in the Senate and exactly 48 Democrats in the Assembly. If every one of them supported the resolution, New Jerseyans can decide this year if they want to amend the constitution to increase taxes on millionaires. Cynics say Democrats would rather make this an issue in 2013 when Christie and all 120 lawmakers are up for re-election.
Assemblyman Reed Gusciora sponsors the millionaires' tax hike resolution. This proposed constitutional amendment requires that the personal income tax rate on annual income over $1,000,000 be at least 10.75% from its current 8.97%. It requires that the amount of money collected from the tax rate on income over $1,000,000 be spent annually on direct property tax relief. Direct property tax relief includes but is not limited to homestead rebates, homestead property tax reimbursements, veterans' property tax deductions, senior and disabled citizens' property tax deductions, and property tax deductions and credits.
"I'm all for taking politics out of the issue," says Gusciora. "I'm not trying to aim for the 2013 election….Ideally we'd like to see this issue posted in this November's ballot in one shot. I would favor it being in one shot this year. Nonetheless if we're not able to get the support then we'll aim for 2013…..This is an opportunity for the voters to weigh in whether New Jersey should have the millionaires' tax or not."
Democrats had the chance to keep the millionaire's tax alive just before Christie took office, but they decided to let it sunset while Jon Corzine was still Governor. Corzine says he would have signed it into law.
Gusciora hopes some Republicans will also support the millionaires' tax increase. He says, "Republicans have shown great interest in allowing issues to be resolved by referendum." Before vetoing a bill to legalize gay marriage which was also sponsored by Gusciora, Christie said they should ask voters in a referendum.
"For the first time in 10 years, a majority of New Jersey voters believe the state is headed in the right direction," says Bramnick. "The Democrats' plan to place a constitutional amendment on the ballot to raise taxes is the wrong message at the wrong time. The new message being crafted by the Democratic majority may appear to be good politics, but it is bad policy at a time when we are finally starting to attract and maintain businesses in our state."
Assembly Democratic staffers say the millionaires' tax increase would generate $836 million in year one (Fiscal year 13), $664 million in year two (Fiscal Year 14), $728 million in year three (Fiscal Year 15) and $800 million in year four (Fiscal Year 16). They say more revenue is generated in the first year because of differences between tax years and fiscal years.