The Ridgewood Blog Brings a Free Market Laissez-faire Point of View to Local, New Jersey State and National Issues.
New Jersey State Assembly and Senate has been controlled by the Democrats for decades. Never mind who is the Governor, there lies the root of all of the state’s problems. All of the political payback to supporters has left New Jersey in this condition. So clean your own house Congressman Pascrell.
file photo by Boyd Loving
July 20,2018
the staff of the Ridgewood blog
Ridgewood NJ, More than 75 percent of the 921 certified public accountants (CPAs) who were surveyed by the New Jersey Society of CPAs (NJCPA) in July said that New Jersey’s 2019 state budget, which was signed by Governor Murphy on July 1, would have a negative impact on the state’s economy. Thirty-nine percent felt the economy would get “marginally worse,” and 37 percent said it would get “significantly worse.” Fourteen percent said it would have no impact, and only 10 percent said the economy would get either “marginally better” or “significantly better” under the new budget.
The budget consists of $37.4 billion in spending, to be funded in part by instituting a tax increase from 8.97 percent to 10.75 percent on taxpayer income of more than $5 million. The budget also included several significant corporate business tax changes, including a surcharge of 2.5 percent for the next two years and 1.5 percent for the subsequent two years for corporations with income of $1 million or more as well as a new combined reporting system. No change was made to the sales tax rate though a tax will be levied on e-cigarettes and short-term lodging, such as Airbnb.
NJCPA survey respondents cited several reasons why the budget plan will not help the state’s economy over the long term. Taxing millionaires could lead to more residents in high-income brackets leaving the state, said respondents. As one noted, “the outward migration of wealth will continue, and the long-term effect will be disastrous.”
Survey participants also said the tax increases on corporations will not help the hiring process or provide incentives to remain in the state. It will likely make the state less friendly to investors and businesses.
July 19,2018
the staff of the Ridgewood blog
Trenton NJ, still dreaming, in what can only be described as a “hail mary” ,Attorney General Gurbir S. Grewal today joined three other states in suing the Trump Administration over its $10,000 cap on the federal tax deduction for state and local taxes (SALT).
Joining New Jersey in suing both the Internal Revenue Service and the Treasury Department were New York, Connecticut and Maryland. The lawsuit seeks to prevent the federal government from enforcing the SALT deduction cap, and to have the cap declared invalid.
Governor Phil Murphy welcomed the action.
“What the Trump Administration enacted with the SALT deduction cap was nothing more than a tax hike on our working and middle-class families and seniors,” said Governor Murphy. “I made a commitment to New Jerseyans to provide long-term property tax relief when I signed legislation to preserve deductibility by enabling municipalities to create charitable funds. We will continue to fight to protect local taxpayers and businesses and I applaud Attorney General Grewal and the states of New York, Connecticut and Maryland for their leadership and action in challenging the constitutionality of this assault on our states.”
“Today we are making good on our promise to fight for New Jersey taxpayers – by taking legal action to protect our residents and restore fairness to the tax code,” said Attorney General Grewal. “Simply put, the federal government violated the constitution when it imposed new, arbitrary limits on the amount of state and local taxes that residents could deduct on their federal tax returns.”
In 2017, the Federal Government adopted a significant change to the federal tax code. Previously, taxpayers who itemized their deductions could deduct from their federal tax liability all money paid for state and local income, property and sales taxes. Under the new code, however, the same taxpayers are only permitted to claim a comparatively small deduction of up to $10,000 for those taxes.
The lawsuit filed today notes that the so-called SALT deduction on individual federal tax liability has historically been recognized by Congress as essential under the Constitution. “A SALT deduction has been a part of every federal income tax law since the first federal income tax was enacted in 1861,” the complaint explains.
The lawsuit adds that the SALT deduction is necessary to prevent federal taxes from interfering with each state’s right to determine its taxation and fiscal policies, because federal taxes crowd the states out of traditional revenue sources like income, property and sales taxes.
The suit asserts that the federal government’s “drastic” decision to cap the SALT deduction at $10,000 will significantly increase the federal tax liability for residents of each of the plaintiff states, including New Jersey. Homeowners who could once deduct the full cost of their local property taxes now can only deduct a fraction of those taxes. That will increase the cost of owning a home, which in turn will depress home values.
To make matters worse, the states explain, the federal government went after these states deliberately. Treasury Secretary Steven Mnuchin even said, the point of the changes to the SALT deduction was to “send a message to the[se] state governments” that Washington wants them to change their spending policies. That effort to coerce states, the complaint notes, is another reason why the latest SALT changes are illegal.
Today’s joining of the federal lawsuit by Attorney General Grewal is the Attorney General’s latest action aimed at protecting New Jersey residents from oppressive new federal tax policies under the Trump Administration.
In May, Attorney General Grewal wrote the U.S. Internal Revenue Service (IRS) urging that it stop “playing politics” and drop its plan to enact a rule that would prevent New Jersey residents from claiming deductions for charitable contributions made to their local governments. Governor Phil Murphy had previously signed a law allowing residents to receive property tax credits for such charitable contributions.
July 9,2018
the staff of the Ridgewood blog
Trenton NJ, New Jersey governor Phil Murphy signed a bill that would dedicate $5 million in government sponsored local news.
Under the ruse of ‘social justice”, the so-called “Civic Info Bill” was passed by the state legislature in June and will create the Civic Information Consortium, a nonprofit organization that gives grants to promote media in “underserved communities, low-income communities and communities of color.”
After all “people of color” need to be told what to think by the state , and state controlled media is the best tool of the propagandist.
Applicants apply for grants by proposing a “collaboration” between one of five public universities and a community organization, a media outlet, or a member of the state’s technology sector. The proposal must also “offer a clear benefit to communities.” Which means if it keeps people down , promotes victimization and echo Democrat talking points it will be funded .
One goal of proposed grants should be to “better meet the information needs of low-income communities and racial and ethnic communities that have been undeserved by the media.” Meaning the central idea is to push “fake news” that promotes the fialed state agenda .
Which translates into too many “people of color” are starting to think for themselves and we can have that.
The state Democrats will of coarse have a large role in deciding who is eligible to receive such grants.
Under the bill the state would establish a Ministry of Propaganda a 13-person board of directors will be in charge of approving grants will have two appointees each from the governor and the legislature, as well as five picks from the universities. Those nine directors will, by majority vote, choose the last four members.
Some activist organizations that have expressed support for the bill include Action 21 Immigrants Rights Advocacy Group, LAP Latino Alliance for Progress, and the Latin American Democratic Association. Just one Republican member of the state legislature voted in favor of the bill.
The bill was extensively lobbied for by a group ironically named , Free Press? There is no such think as a government funded “free press”, The organization’s goal of promoting “diversity in media ownership” and is co-founded by at least one progressive journalist. Free Press Action Fund launched a campaign in 2017 to pass an earlier version of the bill. Another words lets force New Jersey’s hapless taxpayer to pay for more failed journalists jobs.
July 7,2018
the staff of the Ridgewood blog
Trenton NJ, around two years ago, New Jersey’s richest resident , hedge fund billionaire David Tepper decided to move himself and his business to Miami Beach. Tepper, who personally earned more than $6 billion from 2012-2015, was tired of paying New Jersey’s top income-tax rate of 8.97% for the 20 years he lived there, in addition to the country’s highest property taxes, the estate tax and inheritance tax. By moving to Florida, a state with ZERO income tax, Tepper stood to save hundreds of millions of dollars each year. Tepper’s departure left an enormous hole in the New Jersey budget .
Anyone with an ounce of common sense would have at least acknowledged the possibility that a guy like Tepper would consider moving to save a few hundred million dollars , anyone that is except ,”stuck on stupid ” Trenton .
Tepper is not the only one to leave , according to the New Jersey Business and Industry Association, the State of New Jersey lost a whopping 2 million residents between 2005 and 2014, earning a combined $18 billion in net adjusted gross income, i.e. income that would have been taxed by the state.
With those out flow numbers Its not just the masters of the universe that are tired of paying sky-high taxes. It’s also the regular wage earner and small business owners. A whopping 60% of these folks went to Florida, with a state income tax of zero.
So the message from New Jersey’s residents (well, now former residents) is loud and clear: taxes are too high!
Now, what do you think New Jersey is doing to solve this problem?
New Jersey residents elected a governor that promised to raise their taxes, so instead of making the state friendlier to productive people and businesses , New Jersey has embarked on a program of driving out tax payers and replacing them with tax takers .
New Jersey now taxes residents making more than $5 million will now pay 10.75%, up from 8.97%.The corporate rate on businesses with more than $1 million in net income was also increased from 9% to 11.5% (Proportionally, that’s a potentially 27% increase in the amount of tax a business might pay).
This will simply exacerbate the problem even more ,chasing more businesses and people out of the state .
July 1,2018
the staff of the Ridgewood blog
Trenton NJ,in a last minute deal the state government shut down has been avoided . Assemblywomen Holly Schepisi , “Update for New Jersey residents. It appears a State shutdown will be averted. On the upside you will be able to go to the beach, the racetrack or a casino, and renew your license. On the downside you will be paying even more for gas, internet purchases, hospital visits, plastic and paper bags, Airbnb, Uber and Lyft, health care, and utility bills. I keep hearing a mantra of New Jersey needs sustainable revenue. However New Jersey has significant revenue. New Jersey ranks in the top 5 highest taxed states in the country. New Jersey has among the highest pension debt. Any tax and spending increases without real reforms to our pension system is irresponsible and reckless. Good luck New Jersey residents. You voted for this”
This is a great example of why this state is failing. The Federal government increases the pain we all feel by changing the property tax deduction which lowers our property values and the state increases the taxes on the decreasing value of our property. This in turn makes staying in NJ less viable, which again, lowers our property values. Instead of realizing that we need real structural changes in the state to bring the fiscal house in order, we are led by people that don’t know that eventually you run out of other people’s money.
Let me try to put this year’s state budget insanity into perspective. Last year the Democrat Legislature shutdown the government because they were fighting over a $34.7 billion dollar spending plan, and this year they are fighting with Democrat Governor Phil Murphy over two spending plans: their plan to spend $36.5 billion and Murphy’s plan of $37.4 billion. Except this time it is over which taxes to hike to fund their irresponsible spending increase.
New Jersey’s Democrats can’t even agree on how much to increase spending and how much to raise taxes; meanwhile the state careens ever faster toward financial disaster. New Jersey has had more people move-out the past six years than any other state in the nation because housing costs and taxes are sky-high, which makes me ponder when New Jersey Democrats will stop the insanity.
Assemblyman Kevin J. Rooney
June 20,2018
the staff of the Ridgewood blog
Trenton NJ, Today, the respective Senate and Assembly Budget Committees passed S-2746/A-4202, which would drastically increase the corporate business tax rate. The New Jersey legislature will consider the measures on Thursday.
Lawmakers are considering raising the corporate tax rate between 11.5 and 13 percent based on the size of the local business. These drastic tax increases would make the Garden State the seemingly proud owners of the highest business taxes in the nation. Business tax rates addressed in this proposal are currently levied at 9 percent.
AFP-NJ State Director Erica Jedynak issued the following statement:
“We want businesses to set up shop and thrive in New Jersey. Our businesses are the life-support of the economy, and these jobs help local workers provide for their families. Dramatic tax increases will hurt the families, workers, and entrepreneurs that hope to make New Jersey home. Due to the nation’s highest property taxes, New Jersey families are already being taxed into exile and raising the corporate tax rate could very well serve as the death blow to the New Jersey economy. Now is the time for lawmakers in Trenton to ensure that our job creators remain hiring and open for business. Instead of maintaining the failed status quo, New Jersey lawmakers should work toward practical solutions that decrease taxes in our state and increase prosperity.”
Background:
AFP-NJ issues Action Alert to Activists
AFP-NJ’s Tax & Spending Reforms
For further information or an interview, reach Anna McEntee at amcentee@afphq.org or (703)-674-9227.
Americans for Prosperity (AFP) exists to recruit, educate, and mobilize citizens in support of the policies and goals of a free society at the local, state, and federal level, helping every American live their dream – especially the least fortunate. AFP has more than 3.2 million activists across the nation, a local infrastructure that includes 36 state chapters, and has received financial support from more than 100,000 Americans in all 50 states. For more information, visit www.AmericansForProsperity.org
June 20,2018
the staff of the Ridgewood blog
Trenton NJ, Assembly Republicans on the budget committee unanimously rejected a competing legislative tax plan today that raises taxes by $1.2 billion dollars. Legislative Democrats swapped Gov. Phil Murphy’s proposed millionaires tax and sales tax increase for a corporate tax hike and other tax increases.
“Legislative Democrats keep warning about how Murphy’s millionaires tax will drive high-earners and their businesses out but their plan taxes businesses at a much higher rate,” said Assemblyman John DiMaio (R-Warren), the Republican budget officer.
Under their plan, the top rate on corporations would jump from 9 percent to 13 percent. Murphy proposed raising the top income tax rate from 8.97 percent to 10.75 percent on income over $1 million.
“That is much more likely to make businesses move out, not the other way around,” concluded DiMaio. “Their own argument refutes their plan.”
The new rate would apply on corporations earning more than $25 million and would become the highest business tax in the nation. Businesses earning between $1 million and $25 million would also pay a slightly lower rate of 11.5 percent. That would only be exceeded by Iowa at 12 percent, which is in the process of lowering its top rate to 9.8 percent.
New Jersey currently has the sixth-highest corporate tax rate in the country, and has been rated the worst business tax climate for the past four years according to the Tax Foundation.
“Increasing corporate business taxes for even two years to what is already one of the highest rates in the nation will slow already lagging job growth,” added Nancy Munoz (R-Union), a member of the budget committee.
New Jersey has lost nearly 15,000 jobs since January, according to the Bureau of Labor Statistics, while the labor force has decreased by 30,000 people.
“Democrats claim they want to help those who are struggling but they make it harder by increasing the cost of doing business,” continued Munoz. “When jobs are being lost, the poor get poorer and the middle-class shrinks.”
Reader says , LOL Murphy was too busy crying about the media “releasing” his sons medical records. This is a perfect example of how gun control and tighter gun laws are not going to stop much or ANY of our countries gun violence. This was a gang rivalry which means 99% of the guns used we’re probably bought off the black market, has nothing to do with people who are willing to buy a gun legally, Same thing with columbine, all the guns those kids had we’re from the black market as well. The liberals don’t understand that you can take all the gun stores THAT DO THINGS THE RIGHT WAY. Eventually, good guys won’t have guns, bad guys will….and that’s when humanity starts screwing itself over, but after all….that’s what the liberals want.
So what no protests ,or school walk outs , no blame the NRA? The facts remain the same controlling legal gun ownership has almost no impact on gun violence . “This was gang warfare. And it’s probably the most common form of gun violence seen in major cities on a yearly basis. But nobody is talking about it the way they will if a deranged white guy with a rifle commits the far more rare mass shooting of that type. There’s a gun violence problem here that could be addressed, making a serious difference. But places like Baltimore, Maryland and Chicago, Illinois still have municipal leaders who can’t bring themselves to pass harsher laws to put away first-time offenders who commit gun crimes. They prefer to focus on justice reform, emptying the prisons more quickly and blaming the police.” https://hotair.com/archives/2018/06/18/mass-shooting-nobody-will-march/
June 18,2018
the staff of the Ridgewood blog
Trenton NJ, just days after Governor Phil Murphy signed six new major gun control measures into law, giving the the Garden State the strictest gun control in America , a dispute between rival gang members may have led to a shooting that erupted in the early-morning hours of a popular all-night arts festival in Trenton, killing one, injuring 22. None of those laws stopped a mass shooting this weekend at a Trenton, or saved a single person .
Just four days ago Governor Phil Murphy on Twitter outlined some of the changes that would take place following the enactment of what he called “landmark legislation,” including requiring background checks on private gun sales, the reduction of magazine capacity, a ban on armor-piercing bullets, and keeping “guns out of the wrong hands.”
According to Mercer County Prosecutor Angelo Onofri the deceased suspect has been identified as Tahaij Wells, 33. Wells was released from prison and on parole since February on homicide-related charges.
The one man in custody is Amir Armstrong, 23, who has been charged with a weapons offense. Armstrong remained hospitalized in stable condition.
A third unidentified suspect was hospitalized in critical condition.
June 15,2018
the staff of the Ridgewood blog
Trenton NJ, The Department of the Treasury today announced that dedicated revenues remain stable while General Fund revenues remain weak for FY 2018 with the Corporation Business Tax (CBT) seeing a substantial decline for the month of May.
As State Treasurer Elizabeth Maher Muoio has pointed out in recent months, despite the growth in dedicated revenue sources – the Gross Income Tax (GIT) and the Petroleum Products Receipt Tax (PPGRT) – a challenging structural imbalance remains due to the weakness in revenues supporting the General Fund. Excluding the GIT and the PPGRT, collectively all other major revenues are down $120.4 million so far in FY 2018.
The CBT declined 44.8 percent in May and is down 3.4 percent for the year. The CBT for banks and financial institutions is down 26.8 percent year-to-date. Additionally, the Motor Fuels Tax, Estate Tax, the Cigarette Tax, and Casino Revenues are also down through the end of May.
Overall, May revenue collections for major taxes were up 6.3 percent compared to last May, however this is due solely to the growth in two of the State’s dedicated revenue sources. Year-to-date, total revenues increased $1.478 billion, or 5.9 percent, tracking closely with the FY 2018 revised aggregate target.
The Sales and Use Tax, the largest General Fund revenue, was up 1.1 percent in May and is growing by only 1.5 percent year-to-date due to recent tax rate reductions.
May collections for the GIT rebounded from April’s weak performance. Net receipts of $990.3 million were up $116.2 million, or 13.3 percent above last May. Of that growth, $71.5 million was due primarily to the annual “tail” of final 1040 tax payments lagging into May. The GIT, which is dedicated to the Property Tax Relief Fund, is up 9.4 percent year-to-date in FY 2018, $1.125 billion above the same point last year.
The State’s other significant dedicated revenue, the PPGRT, is up 70.7 percent through the end of May, $474.0 million above the same point last year, due to a statutory tax rate increase. These funds, however, are dedicated to the Transportation Trust Fund.
June will be the 12th month of FY 2018, featuring important quarterly estimated payments for the GIT and the CBT. In particular, the CBT’s June quarterly estimated payments are highly uncertain following a 16.0 percent decline during April and a 19.5 percent decline in May. Treasury estimates some improvement in June, but if double-digit declines continue, the CBT would fall below the year-end target.
June 13,2018
Assemblyman Kevin J. Rooney (R 40)
(Kevin J. Rooney, a Republican, is an Assemblyman representing parts of Bergen, Essex, Morris and Passaic counties in the 40th Legislative District.)
Ridgewood NJ, A Monmouth University poll recently found the unsurprising fact that New Jerseyans are more concerned about their nation-high property taxes than any other issue in the state. The second biggest concern is all the other taxes we have to pay.
Yet, our governor has presented a budget that intends to raise taxes by $1.7 billion, with over $729 million of that tax hike being forced on the low- and middle-class by increasing the sales tax and expanding it to Uber, Lyft, AirBNB and online shoppers.
In the meantime, his budget reduces overall property tax relief by keeping state aid from municipalities and cutting rebates for low-income families, seniors and the disabled in half. But don’t worry taxpayers; the money Gov. Phil Murphy is cutting from property tax relief will be going toward raises for the public unions who got him elected.
For decades the number one issue in New Jersey has been our incredibly high property taxes. So lowering property taxes should be his number one priority.
But it’s not.
Instead, Murphy talks out of both sides of his mouth. First he talks about the state’s budget problems then proposes spending that costs a billion dollars more than his misguided tax hikes. His plan to prop-up his budget is no different than the past governors he criticizes for passing on this mess.
The plan will divert half of the money from an environmental settlement with ExxonMobil to prop-up his budget, in direct contradiction to his campaign promise to use environmental money for environmental purposes. Those New Jersey values he likes to talk about aren’t reflected, because Murphy is not only breaking a promise, he is blatantly disregarding the will of the voters who elected him. Those same voters constitutionally dedicated environmental money for environmental purposes just last year.
Murphy will also use money the state received from a settlement with Volkswagen to prop-up his budget, and he raided affordable housing funds so towns with court-ordered obligations have to put the entire cost burden on property tax payers who are unwillingly being forced to build housing that is not wanted or needed.
Lt. Gov. Sheila Oliver made it clear what the problem is while addressing the Assembly Budget Committee. She said the governor “probably had no idea” as a candidate last year just how bad the state’s budget problems really are.
He seems fine with having no idea of what the state’s budget problems are. New Jersey has been cited as being in the worst fiscal condition in the nation, with our state’s long-term finances having been referred to as “dire.” While we can’t pay for all of the programs we have now, Murphy is piling on with new unaffordable programs.
In addition to free community college, universal pre-K, financial aid for unauthorized immigrants and salary increases for his cabinet officials; Murphy has recently proposed giving science, technology, engineering and math employees, but nobody else, student debt relief. The employers will even be required to match whatever amount the state reimburses.
All of these extravagant programs are well intended, but they are very irresponsible and clearly show that his attention is on an unrealistic New Jersey utopia rather than a state in dire straits whose residents just want somebody to lower their property taxes.
Murphy and his Democrat colleagues have even become somewhat hypocritical about property taxes.
While continually complaining about the federal government capping property tax deductions at $10,000, Democrats ignore that the cap was modeled on what New Jersey already does.
The common-sense response is to eliminate New Jersey’s own $10,000 cap to help residents who get hit by the new federal cap. That would provide immediate property tax relief for our residents. Unfortunately, that idea has been voted down four times by Democrats, who have controlled the legislature since 2001.
In its place is a superficial scheme to create government charities that would give tax credits for contributions. The scheme won’t work because the IRS has to recognize a charitable organization before it becomes legitimate. That is a hard sell when there is no real charitable intent and a public campaign parading this plan as an escape from federal tax policy.
In fact, the IRS has already given notice to states that the scheme won’t work. So Murphy will just entangle the state in another costly lawsuit — there are 30 –against the federal government on the taxpayer’s dime.
Murphy is out of tune with state taxpayers. He is redirecting funds against the public will and using the same gimmicks that he claims got the state in this mess in the first place. And with three weeks left to sign a balanced budget, he still plans to raise taxes and spending and provide less relief.
June 10 ,2018
the staff of the Ridgewood blog
Washington DC, The U.S. Department of Justice said on Thursday that the part of Obamacare requiring individuals to have health insurance aka the individual mandate is unconstitutional. This should be interesting to New Jersey voters with the recent signing by Governor Phil Murphy of a rule requiring the enforcement of the individual mandates and thereby fining individuals without insurance .
In a brief filed in a federal court in Texas, the department said a tax law signed last year by President Donald Trump that eliminated penalties for not having health insurance rendered the so-called individual mandate under Obamacare unconstitutional.
The Justice Department said that also nullifies two other major provisions of Obamacare linked to the individual mandate, including one barring insurance companies from denying coverage to people with pre-existing conditions.
Attorney General Jeff Sessions, in a letter to House of Representatives Speaker Paul Ryan, said he had determined the individual mandate will be unconstitutional when the tax law becomes effective in 2019.
