NJ business leaders say taxing millionaires will be costly for rest of us
In his proposed $32.4 billion state spending plan, Gov. Phil Murphy is calling for a tax hike for everyone with an income over $1 million a year, maintaining a 2.5% surcharge on corporate taxes (which had been scheduled to drop to 1.5%) and other assorted increases. His proposal also calls for borrowing $4 billion to cover the revenue gap resulting from the COVID-19 shutdown.
New Jersey business leaders are not thrilled with the plan.
Eileen Kean, the state director of the New Jersey chapter of the National Federation of Independent Business, said the proposed millionaires tax would negatively impact small business owners in the Garden State who, when they retire and sell their business, would get taxed at a much higher rate.
“This has huge, perhaps unintended consequences. This hurts the middle class family,” she said. “This hurts business owners that have put their lives into developing businesses.”
Michele Siekerka, the president of the New Jersey Business and Industry Association, said this is a terrible time to be talking about raising taxes on any individuals or corporations.
“Our economy is in a free-fall and we are inviting New Jersey’s millionaires to exit the state quicker than they may have contemplated before," she said.
She also said if taxes are increased for some at the top, there will be a domino effect.
“As the wealth continues to leave the state of New Jersey, and we have a governor who keeps increasing the spending costs in the state of New Jersey, it’s going to mean that all the rest of us are going to be picking up the bill,” said Siekerka.
Kean and Siekerka said borrowing buildings is the wrong move.
“Not only are we already paralyzed by bonding of the past, we’re now really crippling the future generation by putting yet more debt on our future generation," Siekerka said.
Siekerka pointed out that the amount Murphy wants to borrow is close to the amount the budget proposes putting into the public worker pension system.
“In a dire crisis state that our economy is in right now, this would be the year to take a skip rather than to use bonded money in order to fill that gap," she said.
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