TRENTON – In votes that went along straight party lines, the state Legislature passed the Democrats’ $31.74 billion Fiscal Year 2013 budget Monday. The spending plan fully restores the Earned Income Tax Credit to help New Jersey’s working poor that was reduced two years ago, and sets aside money to give residents tax relief if the state’s revenue collection meets Gov. Chris Christie’s ambitious targets during the first five months of the fiscal year.
Gov. Chris Christie blasted the budget, calling it a return to the practices of the Corzine administration. “I will not allow New Jersey to go back to the same failed policies that nearly put our state over a fiscal cliff,” the governor said. “Tax relief for our hardworking families is long overdue and that is exactly what I will continue fighting for.”
Christie can reject the budget outright, but many expect him to use his line item veto to bring the Legislature’s version more closely in line with his vision. New Jersey’s constitution requires the state to have a balanced spending plan in place by the beginning of the fiscal year on July 1.
Christie had originally proposed an across-the-board income tax cut for all New Jersey residents, but Democrats balked because most families would save so little they would be unlikely to notice the change in their take-home pay. They countered with a plan to offer an income tax credit based on the amount of property taxes paid.
While the Legislature’s budget includes $183 million for tax relief, it does not offer any specific language detailing a tax cut or credit. The fine points of tax relief would be worked out once it’s clear that tax revenue collections can support it.
“Everybody wants a tax cut, but it has to be an affordable and responsible tax cut that we can pay for,” said Assembly Budget Committee Chairman Vincent Prieto, D-Hudson.
Republican lawmakers questioned the Democrats’ priorities.
“Republicans would have been more than happy to work with the Majority to find further savings to pay for an immediate tax cut if the Democrats were insistent on second guessing the Governor’s revenue certification,” said Senate Republican Leader Tom Kean, Jr. (R- Union). “Rather than prioritize tax relief, the Democrats used the opportunity to play politics with the first broad based tax relief New Jerseyans would have seen in almost two decades while being all too eager to spend money elsewhere.”
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