New Jersey Assembly Republicans have a message regarding the state’s budget surplus: provide tax relief to residents now.
Assemblymen Christopher DePhillips (R-40) and John DiMaio (R-23) both hit back at the plan of Assembly Speaker Craig Coughlin (D-19) to introduce the “largest tax relief program in state history.”
Meanwhile, Gov. Phil Murphy’s plans would entail working with Trenton lawmakers to fund debt reduction, build the state’s surplus, and provide greater property tax relief.
No More Gimmicks
DiMaio, who serves as the Assembly’s Minority Leader, called the plan a “short-term gimmick” that would not provide real tax relief to the state’s residents or address the root causes of New Jersey’s affordability crisis.
“The Democratic majority, who raised nearly 60 additional taxes, should have never taxed us so much in the first place. We have to cut taxes if we want to give residents real relief,” he said.
OLS Forecasts for Fiscal Years 2022, 2023
The nonpartisan Office of Legislative Services (OLS) both forecasted billions of dollars more in revenue coming to the state in the next two years.
For FY 2022, Treasury officials projected a $4.5 billion increase for a total of $51.4 billion; meanwhile, they projected a $3.3 billion increase for FY 2023 for a total of $50.6 billion.
Additionally, OLS increased the revenue forecast by $3.6 billion over the same two years. Provided the estimates are correct, the state would have nearly $7 billion more in tax revenue than what the Murphy administration estimated in March.
After the Murphy Administration’s revised numbers were released, Coughlin’s declared he would pass a budget this year without tax relief for Garden State residents.
“The revenue update shared with the Legislature today demonstrates a surplus of billions of dollars beyond what was anticipated in the Governor’s proposed budget,” said Coughlin. “We have additional money this year, and New Jersey needs tax relief now. In this year’s budget, I will insist on the largest tax relief program in state history.”
Deputy Treasurer Aaron Binder offered that the Murphy Administration would work with Trenston lawmakers to use the additional revenue boost to provide greater property tax relief, more funding for debt reduction, and to build up the state’s surplus in the face of a potential economic downturn.
DePhillips Calls for Immediate Benefits
DePhillips argued with inflation on the rise, residents needed immediate relief and providing tax relief with the revenue windfall could provide that.
The Wyckoff lawmaker pointed to New Jersey’s average property taxes of $9,112 per year as one of the highest in the nation, and said that instead of one-time tax rebates the state should engage in permanent tax cuts.
Additionally, he said indexing state income taxes to inflation, dedicating income tax to fund schools, and cutting down public employee benefits would help to combat taxes.
“We are notoriously overtaxed in this state, making it unaffordable for young people moving from their childhood homes, to the elderly on fixed incomes, and everyone in between,” DePhillips added. “Gov. Murphy borrowed money we didn’t need and collected more taxes than he anticipated. We must act to lower taxes now to ensure a prosperous New Jersey for everyone later.”
But State Senate Budget Chairman Paul Sarlo (D-36) noted on social media after the hearings the state needed to be prepared for a coming economic downturn.
“We should increase the size of the state surplus so we are prepared for economic downturns that are likely to come,” Sarlo tweeted. “The surge in state revenue is welcome, but it comes with warnings. We can’t expect it to continue. We have to be prudent and responsible in how we manage resources.”
“I am open minded to plans to cut taxes or deliver savings to NJ residents in other ways. An increased surplus is achievable at the same time. We can find the right balance that is prudent & responsible, that helps taxpayers & the economy,” he said.