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New Jersey Democrats Move to Raise Taxes

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TRENTON—State Democrats plan to advance budget bills Tuesday that raise taxes on high earners and corporate profits to shore up the state’s underfunded pension system, a proposal likely doomed because Republican Gov. Chris Christie has pledged to veto any tax increases.

The annual budget dance in Trenton typically leads to interparty fighting in June, but observers said that this year’s proceedings were particularly defined by gridlock, resulting in more political theater than fiscal negotiations.  (Haddon/Wall Street Journal)

http://www.wsj.com/articles/new-jersey-democrats-move-to-raise-taxes-1435020808

9 thoughts on “New Jersey Democrats Move to Raise Taxes

  1. Another broken solution to prop up the failing status quo…. All this would do is feed the vampire squid that has destroyed NJ’s economy & economic competitiveness. Raise taxes on everyone to prop up a broken pension system? When we’re already the highest taxed people in the land? #unsustainable, #bankruptpolicy, #Dumbocrats

  2. I guess none in these union lackeys read page eight of the Pension Commission report? http://www.state.nj.us/treasury/pdf/FinalFebruaryCommissionReport.pdf

  3. Try to get your facts straight 8:43 am, raising taxes is NOT a broken solution, it is one of only two options increase income or reduce spending, period. The pension underfunding problem is because the current and past governors did not make the contributions they were suppose to because they chose to spend money on other things. Had the proper state contributions been made at the appropriate times the pension systems would all be fully funded today.
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    You 9:46 pm and your fellow low information intellectually lazy voters ignored what the governors were doing with your tax dollars for decades and you let them take money from the government employee pensions to balance their bloated budgets and now your upset because you realize you are going to have to pay more taxes to make up for that. Well welcome to the party Mr. Intellectually lazy voter, you didn’t care about this before so your gonna pay now like it or not.
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    Maybe now you will look at the Billions of wasted tax dollars the state spends on social programs, state college sports programs, Abbot schools, affordable housing, open space, and corporate welfare to multi-BILLION dollar corporations, and lets not forget he casinos in Atlantic city and the sports authority and Meadowlands farce.
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    Maybe if enough of you low information intellectually lazy voters get together and demand the state stop wasting Billions of your tax dollars on these programs maybe, just maybe, your taxes will not have to go up to properly fund the pensions that have been promised and the taxpayers are legally, morally and ethically required to pay.

  4. I guess the 1% can’t afford it.

  5. Very few private sector jobs offer pensions anymore, and subsidized health care coverage until age 65 is only for public sector workers. So why are my taxes going to subsidize these things for public workers, some of whom make more than the median household income in Ridgewood? The original contract to provide a pension and healthcare coverage for those in public service was based off of trade-off: lower wages in return for retirement security. That trade-off no longer holds true, and because retirees are living longer in to their mid-80s on average, the pension and healthcare bills are piling up… and yet these guys in Trenton just want to keep on raising my taxes?

  6. 7:34, read the report. Taxing the 1% won’t cover the underfunding gap, you’d either have to raise state income taxes by 29% overall or raise the NJ sales tax to 10% just to maintain existing benefits…such measures would face significant obstacles from State constitutional mandates on the use of specific revenue sources for particular purposes, such as the dedication of all income taxes to property tax relief. In addition, the State must obey federal mandates, honor bonded obligations and meet other funding demands. As a result, roughly 87% of State revenues are effectively committed to specific purposes before the budgeting process begins. The remaining funds—$4.3 billion in the current budget—are counted on for vital functions such as law enforcement, public safety, the judiciary, and executive department offices. A “millionaires’ tax” imposing an average $50,000 additional annual tax on each millionaire, for example, would make only a small dent in the funding shortfall. It would still require the State to impose a 23% income tax increase on every other taxpayer. As a matter of political reality, potential tax increases of this magnitude would first be preceded by substantial benefit reductions. If existing pension and retiree health benefits are considered beyond reach, the remaining options would involve actions such as reducing active employees’ health benefits to the equivalent of Bronze-level coverage under the Patient Protection and Affordable Care Act (“ACA”) and eliminating retirement benefits for employees hired after 2010.

  7. So screw current employees to pay for existing retiree benefits, and raise taxes on everyone else? Nice choices.

  8. 7:14am, the pension systems are NOT fully funded today – face that FACT. The money is gone – face that FACT. And forever just raising taxes is NOT a solution due to State constitutional mandates on the use of specific revenue sources for particular purposes. In addition, the State must obey federal mandates, honor bonded obligations and meet other funding demands. As a result, roughly 87% of State revenues are effectively committed to specific purposes before the budgeting process even begins. Active employees’ health benefits will be reduced to the equivalent of Bronze-level coverage under the Affordable Care Act and employees hired after 2010 will see their retirement benefits eliminated completely because there won’t be any money left in the pension plans when they start retiring after 2035, that’s jFACT. And those cuts would just be enough to maintain the current level of existing pension and retiree health benefits, that’s also a FACT. Face these facts, and realize that entitlement benefits need to be reduced by an equivalent amount to any additional taxes. If you can’t face these facts, you’re part of the problem.

  9. 7:13, tax increases are a failed solution. What have all of the tax increases since the 1990s done? Nothing. We have a $170bn unfunded pension plus healthcare liability in NJ despite all of these tax increases. Just look at average taxes in 1990 and compare them to average taxes in 2015. And yet the state and Village are easing for bankruptcy. If raising taxes isn’t a failed solution, then you must be a beneficiary of this taxpayer fraud. You have to cut benefits, and the Democratic legislature that’s been in Trenton since 2002 (13 years and counting) has to stop buying votes in exchange for funding pet union projects like Xanadu/American Dream. the system’s broken. If you can’t see that, you’re obviously up to your eyeballs in the mess.

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