Plugging a $2 billion hole

From the Asbury Park Press:

Amount of tax relief still undecided

New Jersey’s legislative leaders say they hope Gov. Corzine will agree to devote all of the revenue from last year’s sales tax increase to easing the state’s property taxes — the nation’s highest.

But Corzine’s administration, as it prepares a budget plan for introduction next week, hasn’t agreed to that as it tries to fix a $2 billion budget hole.

Voters in November approved dedicating half the money earned from the July sales tax increase to property tax relief, and Assembly Speaker Joseph Roberts Jr. and Senate President Richard J. Codey want to see voters decide this year whether to dedicate the rest to easing the nation’s highest property taxes.

“I am still committed to that and am very optimistic we can do that,” said Roberts, D-Camden.

Codey, D-Essex, said putting all money raised by the sales tax increase toward property tax help should be doable, but Corzine’s administration remained cautious.

Corzine proposed increasing the sales tax from 6 percent to 7 percent last year to help tackle chronic state budget woes and faces a projected $2 billion budget deficit for the fiscal year that starts July 1. He will introduce his budget plan on Thursday.

“Providing additional property tax relief remains a goal, but we’re still obviously in a structural budget deficit situation,” Treasury Department spokesman Tom Vincz said.

But Codey said he’s optimistic increased bonuses on Wall Street last year will boost state income tax collections and help eliminate the $2 billion hole.

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