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New State Budget Rejects Gov. Phil Murphy’s calls for More Tax Hikes


the staff of the Ridgewood blog

Trenton NJ, The New Jersey Legislature is moving aggressively on Democrats’ $38.7 billion state budget proposal .The Democratic controlled  state Legislature have insisted they won’t support a Murphy’s millionaires tax, and their proposed $38.7 billion budget preserves just one of the Democratic governor’s proposed tax increases raising the tax paid by HMOs , The legislator took money out of the state’s rainy day fund, cutting some spending and tweaking revenue estimates for the coming fiscal year to balance the budget.

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Professor Murray Sabrin Suggests Support for “Millionaires Tax” filled with economics ignorance and a broken moral compass

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by Murray Sabrin’s Road to Liberty

I sent the following letter to the editor (The Record) this morning in response to the essay by several members of the clergy.

Re “Why we support Gov. Murphy’s millionaires tax,” (Your Turn, May 24″).

The essay by several North New Jersey clergy reveals not only their economics ignorance but also a broken moral compass – which is an unfortunate given they make weekly sermons from their respective pulpits.

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Sweeney Bashes Murphy’s Latest Millionaire’s Tax Proposal As A Fiscal Charade: ‘For This Governor, The Millionaire’s Tax Is Just A Talking Point’


the staff of the Ridgewood blog

Trenton NJ, Senate President Steve Sweeney issued the following statement in response to Governor Phil Murphy’s latest millionaire’s tax proposal:

“The unexpected surge in revenues the Governor is now claiming is the surge the Legislature expected when we imposed a 2.5 percent surcharge on the millionaire and billionaire corporations that benefited directly from the Republican Congress’ tax cut. It is the Corporation Business Tax surcharge we imposed that has been coming in far over the Administration’s revenue projections – just as the Legislature said it would.

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Senator Paul Sarlo, chairman of the Senate Budget and Appropriations Committee , “The Millionaires’ Tax Could Make Economic And Fiscal Conditions Worse”

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the staff of the Ridgewood blog

Woodridge NJ, Senator Paul Sarlo, the chairman of the Senate Budget and Appropriations Committee, issued the following statement today after the committee heard from the Office of Legislative Services and the State Treasurer on the fiscal and economic conditions that will shape the state’s Fiscal Year 2020 budget plan:

“This is a pivotal time for public finances in New Jersey, which makes our work on the state budget as important as ever. We face both immediate and long-term fiscal challenges that can no longer be ignored or deferred.

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Stuck on Stupid Millionaires Tax: Chasing the Bill Payers Out of the State

Phill Murphy -Sara Medina del Castillo

the staff of the Ridgewood blog

Ridgewood NJ, New jersey economic policy is truly stuck on stupid . 40 years of failure and New Jersey wants to keep doing the same thing till they get it right. Fair and Necessary more like just plain stupid .New Jersey Policy Perspective Senior Policy Analyst Sheila Reynertson in response to reports that Governor Murphy will propose a 10.75 percent tax rate on income tax earners over $1 million in tomorrow’s FY 2020 budget address.

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NJBIA: With New Taxes Considered, New Jersey Faltering in Key Economic Areas

Phill Murphy -Sara Medina del Castillo

June 9,2018

the staff of the Ridgewood blog

Trenton NJ, Tax increases being considered by state policymakers this budget season would hit areas of New Jersey’s economy that are already challenged, an analysis by the New Jersey Business & Industry Association finds.

New research shows that New Jersey now has a net loss of nearly $25 billion in Adjusted Gross Income over the past 12 years, is poised to become the worst state in the nation for Corporate Business Tax (CBT), and is lagging in the rate of millionaire growth in the region.
“This concerning data should serve as fair warning to our policymakers that higher CBT, millionaires or sales taxes, on top of the cumulative costs from our recent and increasing business mandates, are only giving our business owners and residents more reason to leave our great state,” said NJBIA President and CEO Michele Siekerka. “And if they aren’t leaving, they’re certainly not planning to grow here.
“This analysis speaks to our declining competitiveness in the region and the nation. We need to improve our state’s economy through comprehensive planning, rather than excessive taxation. This is the only way to reclaim our regional competitiveness and to reverse the disturbing trend of outmigration from New Jersey.”
According to the most up-to-date Internal Revenue Service (IRS) data for tax year 2015-2016, New Jersey experienced a net loss in po­tential Adjusted Gross Income (AGI) of $3.5 billion. This exceeds the average annual rate loss of approximately $2.1 billion over the past 12 years. The change is driven by taxpayers moving out of state and taking their incomes with them.
An NJBIA analysis of the IRS’s Statistics of Income Inflow and Outflow data, finds that from tax year 2004-2005 to 2015-2016, New Jersey experienced a total loss of $24.9 billion in potential AGI.
Since tax year 2004-2005, New Jersey has now gained $66.5 billion in AGI, but lost $91.4 billion.
“This is critical income that has been lost to New Jersey’s general fund for more than a decade,” Siekerka said. “The economic impact that this loss has on the state’s economy is irrefutable and it will worsen if taxes are increased even more.”
New Jersey currently has the sixth highest corporate income tax rate (9 percent) in the United States, while Pennsylvania ranks second (9.99 percent). If New Jersey’s rate on corporations earning a net income of $1 million increases to 12 percent, as proposed, New Jersey would tie Iowa for the highest corporate income tax rate in the nation.
Meanwhile, regional competitors New York (6.5 percent) and Massachusetts (8 percent) have decreased their CBT and currently have the most competitive rates in the region.
An NJBIA analysis, utilizing 2015 data, determined that 2,373 New Jersey companies would have been impacted by the proposed surcharge. Of those, 86 percent (2,033 companies) earned between $1 million and $10 million in net allocated income.

The remaining 14 percent earning more than $10 million (340 companies) accounted for nearly 73 percent ($14.89 billion) of total allocated net income for all companies earning $1 million or more in 2015.

“While most states have either reduced or maintained their corporate tax rates, New Jersey is poised to go in the wrong direction,” Siekerka said. “Some studies link an increase in CBT to a reduction in employment and income and a decrease in CBT to quicker job creation. A CBT surcharge would only incentivize our larger corporations to expand their operations elsewhere. And if they’re stagnating here, that’s just as bad as outmigration for New Jersey.”
A proposed “millionaires tax” provision in the FY 2019 budget would increase the top income tax rate from 8.97 percent to 10.75 percent on income above $1 million.
An NJBIA analysis found that while the number of returns for New Jersey businesses filing $1 million or more increased between 2000 and 2015, New Jersey grew at a slower rate in this category than three regional competitors – including Pennsylvania and New York. In addition, New Jersey’s total AGI for businesses filing $1 million or more ranked fifth out of seven regional states.

“Millionaires have grown around the nation during a time of economic upswing, but New Jersey’s percent change of growth is slower than most of our regional competitors,” Siekerka said. “We should be wary of our tax policies making New Jersey more dependent on the highest income earners who are being given more reasons to consider leaving the state.
Between 2010 and 2015, New Jersey’s number of businesses filing $1 million or more ranked second in the region. But tellingly, New Jersey ranked sixth out of seven regional states in total AGI growth.
The story is similar for New Jersey individuals filing a tax return of $1 million or more. When analyzing data from 2010 to 2015, New Jersey ranked third in the region in this category, but only fifth out of seven in the percentage change of total AGI. In fact, Massachusetts surpassed the Garden State in total AGI from individual millionaires in 2014 and 2015, despite having nearly 3,500 fewer filings of $1 million and more.
“NJBIA continues to call for comprehensive tax and regulatory reform to fix our structural budget deficits,” Siekerka said. “We need our policymakers to pause until the State Tax Policy Working Group, created by Senate President Steve Sweeney, and the Economic Growth Council, created by Gov. Murphy, complete their work and advance comprehensive recommendations. We need them to plan and adopt long-term, sustainable solutions rather than attempt to tax our way out of fiscal challenges.”

An NJBIA Analysis of SOI IRS, 2004-2015
AN NJBIA Analysis of SOI IRS Migration Data, 2004 to 2005- 2015 to 2016
J. Walczak, S. Drenkard, J. Bishop-Henchman. (2018). 2018 State Business Tax Climate Index. Tax Foundation.
Office of Revenue and Economic Analysis. (Jan. 2017). New Jersey Corporation Business Tax Statistical Report. Office of the Chief Economist.
P. Murphy, S. Oliver. (March 2018). The Governor’s FY 2019 Budget: Budget in Brief. Office of Management and Budget.
State Government Websites

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Murray Sabrin : Phil Murphy and Democrats are legal versions of Willie Sutton

Murray Sabrin


Murray Sabrin
Professor of Finance at Ramapo College

Regarding “State senate president plans to push tax bill,” (Nov. 9, page 1A). The people of New Jersey spoke loud and clear on election night. They want state government to spend more of their money. Not really their money, just upper income folks who make up a small percentage of the population. And they want Trenton to expand its already overbearing micromanagement of the economy.

Senate president Stephen Sweeney announced that he will put a “millionaire’s tax” on the front burner when the legislature convenes after Governor-elect Phil Murphy takes office in January.

Raising taxes on millionaires is another example of why government is like Willie Sutton, the notorious bank robber who was asked why he robbed banks, he replied, “That’s where the money is.” Phil Murphy and Democrats are legal versions of Willie Sutton.

Higher taxes on upper income taxpayers will cause any out of state high-income individual, business owner, or corporate executive to think twice about relocating to New Jersey. In other words, we will never how many upper income folks will not move to New Jersey because of the highest marginal taxes Murphy is so hot to increase. In addition, how many people and businesses will leave New Jersey because of higher income taxes? We will soon find out.

The proposed tax increases on millionaires will eventually hit middle-income families, because that is how big government proponents operate—tax the smallest number of families first, then go after where the big bucks are, the middle class.

As H.L. Mencken remarked decades ago, “Democracy is the theory that the common people know what they want, and deserve to get it good and hard. “