From the Star Ledger:
By now, anyone paying attention can see that Republicans in Washington are out to screw New Jersey. We would pay higher taxes under their plan, even though we already subsidize the rest of the country.
But did you know that it could also derail plans to increase taxes on millionaires here in New Jersey? That’s a new twist, and another potent reason to resist this regressive GOP tax plan.
“We really have to take a step back,” says Senate President Steve Sweeney (D-Gloucester).
“It ought to give all of pause,” says Assemblyman Craig Coughlin (D-Middlesex), the incoming speaker.
This is a big deal. Because if New Jersey can’t raise taxes on millionaires, it can’t restore funding for schools, or fix the decrepit transit system, or ease the burden of property taxes.
It would be a $700 million kick in the teeth for the governor-elect, Phil Murphy, who has put this tax hike the core of his fiscal recovery plan.
So, why reconsider this tax hike now? Because New Jersey has one of the country’s most progressive income-taxes, with the top 1 percent providing about 40 percent of the revenue. We hit the rich hard, with the top rate of 8.97 percent.
And the Republican plans, in both the House and Senate, would eliminate the deduction for state income taxes. The impact would vary, but for a standard top earner that would translate into a hike of about 3.5 percent. A hike in the state millionaires tax would add nearly 2 percent more to the top rate.
Suddenly, the rich have a much stronger reason to leave New Jersey, and move to a state with lower income taxes.