(The Center Square) – A coalition of New Jersey chamber of commerce groups are pushing back against proposals in Gov. Phil Murphy’s budget plan they say would hurt employers and the state’s economy.
Murphy’s $55.9 billion budget, which is being negotiated by House and Senate leaders, includes expanded tax breaks for senior citizens and other relief he says will put more than $3.5 billion “back in the pockets of New Jersey taxpayers.”
But the New Jersey Chamber of Commerce is leading a group opposing Murphy’s budget which they say will “reverse” the state’s economic momentum the state has made in recent years and hurt New Jersey’s reputation as a business-friendly state.
“It also creates a lack of confidence for our business leaders that the state will not follow through on commitments they have made,” they wrote in a letter to lawmakers. “And, it makes our state more expensive and less competitive.”
The coalition includes 40 chambers that represent “a substantial percentage of the state employers who believe these moves would damage New Jersey’s business climate, undermine the state’s corporate recruiting and retention efforts, and jeopardize good-paying jobs.”
Specifically, the business leaders took aim at Murphy’s proposed Corporate Transit Fee, which would set a new 2.5% tax on an estimated 600 New Jersey businesses making over $10 million a year in profit.
The new tax would replace the state’s now-lapsed corporate business surcharge – which levies a 2.5% surcharge on net profits above $1 million – which expired at the end of December.
The surcharge was implemented in 2018 in response to a 14-point federal tax cut from the Jobs and Tax Cut Act. The surcharge was meant to be temporary, but Murphy agreed to extend it several times during the COVID-19 pandemic.
The coalition said the new tax would saddle businesses with “a completely unwarranted tax increase – the dollar amount of which is more punitive to those affected than the recently expired CBT surcharge.”
“It is simply a more egregious and expensive extension of the surcharge,” they wrote.
They also cited Murphy’s proposed “buck a truck” tax that would set a $1 excise fee on trucks coming and going from the state’s e-commerce distribution facilities.
The groups also lamented Murphy’s proposed cuts to agencies that are “extremely helpful” for the state’s employers, including the New Jersey Economic Development Authority, New Jersey Business Action Center and The New Jersey Small Business Development Centers.
“The budget will provide less support to an already overtaxed and over-regulated business community,” they wrote. “The biggest threat to our state right now is the future of our economy.”
The New Jersey Business and Industry Association has also blasted Murphy’s proposed taxes, saying it would return New Jersey to an “extreme outlier status” with the highest corporate tax rate in the nation.
Murphy, a second term Democrat who is rounding out his final year in office, has pointed to tax relief in his budget, including an expansion of ANCHOR benefits for senior homeowners and renters, among other provisions. The fiscal year begins July 1.
