TRENTON – When Gov. Chris Christie proposed a state income tax cut in his State of the State speech earlier this month, he said, “Every New Jerseyan will get a cut in taxes…. Everyone made the sacrifice. Everyone will share in the benefit.”
However, according to an analysis by the non-partisan Office of Legislative Services, the governor’s plan would largely benefit New Jersey’s wealthier residents.
If you earn $50,000 a year, you would save $80.50 in state income taxes once Christie’s proposed 10 percent across the board cut is fully phased in after three years. If you make $100,000, you’d save $275. Make a million dollars, and your savings would be $7,286.
“Working families won’t get enough of a refund to pay their weekly grocery bills while the wealthy will receive enough for a vacation at a five-star resort on the French Riviera,” said Sen. Paul Sarlo (D-Bergen), the chairman of the Senate’s Budget Committee during a hearing yesterday. “The question isn’t ‘who will pry money out of the cold, dead hands of legislators,’ as the governor says in his YouTube videos, it’s ‘whose bank accounts will be the real winner’.”
According to David Rosen, the budget expert for the Office of Legislative Services, the proposed tax cut would cost the state government $1.7 billion over three years.
“The governor’s tax plan should receive a full vetting and analysis- once the budget is introduced and we can see it in context,” said Sen. Tony Bucco (R-Morris), the Republican budget officer. “[Monday’s] hearing was a purely political exercise conducted without the benefit of having all the facts in front of us. We will get all the information we need next month when the budget is introduced. Until we have a budget to use as context, trying to come to conclusions about the plan is premature.”
The governor’s proposed income tax cut would not address the state’s property tax. According to a New Jersey Spotlight report, net property taxes are up 20 percent since Christie took office.
Citing data released by the state Department of Community Affairs, the report notes that the average homeowner paid $7,519 in net property taxes last year, a $1,275 increase from the $6,244 paid in 2009. While Christie has had some success in slowing property tax rate increases, homeowners have seen property tax relief decline during his time in office leading to the higher net tax bills.
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