October 7, 2009
Tax Foundation Manager of Media Relations Natasha Altamirano Writes Op-Ed for the Record (Bergen, NJ) on State Business Tax Climate Ranking
"A different take on the state of NJ taxes"
By Natasha Altamirano
Interstate battles over taxes are getting fiercer every year, and New Jersey has been on the losing end of those battles.
Of course, state tax officials don't like to admit that they're on a losing team that's hurting the state, and it's certainly bad for incumbent politicians. So New Jersey Treasurer David Rousseau has written recently in these pages that our study, the State Business Tax Climate Index, is wrong to rank New Jersey at the bottom.
But how could it be otherwise? New Jersey has the highest median property taxes by a mile, the second-highest state-level sales tax rate, the third-highest individual income tax rate. And we haven't even gotten to the business taxes yet.
When taxes are the measure of comparison, New Jersey is in a class by itself. Its taxes not only have high rates, but they are substantially more convoluted than in other states. Our Index looks at five major areas of taxation: corporate income, personal income, sales, property and unemployment insurance taxes.
In each area we ask: Do the states' taxes treat all taxpayers and industries equally by having broad tax bases and low rates, as the top-ranked states do? Or do they favor some taxpayers and punish others by including many credits and exemptions and targeting small segments of the population with punitively high rates, as New Jersey does?
