From the WSJ:
A government shutdown is still looming in New Jersey after several days of budget negotiations between Gov. Phil Murphy and state lawmakers.
The state government could close at midnight Sunday if Mr. Murphy, a Democrat, and the leaders of the state legislature are unable to reach an agreement. On Thursday, Mr. Murphy rejected a revenue-raising proposal floated by state Senate President Steve Sweeney, who had suggested taxing short-term property rentals, as “a straight shot to the gut of the middle class” that would target families vacationing at the New Jersey shore.
Still, Mr. Murphy said he was optimistic the two sides could strike a deal.
“I don’t want the state to shut down,” Mr. Murphy said. “But everything has to be on the table.”
Mr. Murphy and Mr. Sweeney both want to increase state spending in next fiscal year’s budget for public schools, public-employee pensions and NJ Transit but are in disagreement over how to raise the revenue to pay for it. Mr. Murphy wants to raise the state sales tax to 7% from 6.625% and increase income taxes on millionaires.
Mr. Sweeney, a Democrat, doesn’t support increasing those taxes. On Wednesday he said raising the sales tax would disproportionately burden the poor, while a millionaire’s tax could cause wealthy residents to leave the state.
“Honestly all these taxes really, really bother the hell out of me,” he said.
In lieu of Mr. Murphy’s tax proposals, Mr. Sweeney wants to raise the state’s business tax rate. On Wednesday he also suggested the tax on short-term rentals and increasing the state’s realty-transfer tax to 2% from 1% on homes valued at more than $1 million.