Presenting his 2012 State of the State Address, New Jersey Governor Chris Christie (R) spoke extensively on taxes. First he reminded listeners of the situation when he took office:
When I raised my hand to take the oath of office then, I could not say with confidence that the State would meet its payroll within two months. Imagine that, New Jersey unable to meet its payroll. That was the gravity of the mess we were left to deal with due to the mismanagement which reigned in this town before our arrival. Our deficit for that fiscal year, already more than half over, was more than two billion dollars. The budget problems for the next year, fiscal year 2011, was a record deficit of $11 billion.
The solution was not easy, but it was also not complicated. We had spent too much as a state. We had lived beyond our means. And by trying to taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. their way out of it, previous governors and legislators had left New Jersey in 50th place—dead last among the states—in the total tax burden it placed on our citizens.
We had the highest tax rate in the nation, the highest unemployment rate in a quarter century, and the largest budget deficit per person of any state in the nation.
The 50th place in total tax burden to which Governor Christie refers is to New Jersey’s last place ranking in our annual State-Local Tax Burdens report.
After detailing his actions to date, Christie proposed new tax plans for the future:
So in my budget, I will fulfill a promise I made to all the people of New Jersey in 2009. Real relief from the heavy income tax burden that has strangled our families and forced many to move away.
I propose to reduce income tax rates for each and every New Jerseyan. In every tax bracket. By 10% across the board.
I also propose to fully restore the earned income tax credit for New Jersey’s working poor, which we were forced to cut during the dark days of 2010, when growth was gone and we had no money. Understand what this means – every New Jerseyan will get a cut in taxes. The working poor. The struggling middle class. The new college graduates getting their first job. The senior citizens who have already retired. The single mom. The job creators. The parents trying to afford to send their son or daughter to college.
Everyone made the sacrifice. Everyone will share in the benefit.
This will send a loud signal to New Jerseyans and would-be New Jerseyans, to families here now and families who have left, to businesses and job creators thinking of coming here and those who have struggled to stay: New Jersey is once again a place to plan your future, raise your family, grow your business and someday retire. The New Jersey Comeback has begun.
Here’s New Jersey’s current income tax rates, and what a 10% across-the-board reduction would change them to:
|
Income |
Current Rate |
Proposed Rate |
|
<$0 |
1.40% |
1.26% |
|
<$20,000 |
1.75% |
1.575% |
|
<$35,000 |
3.50% |
3.15% |
|
<$40,000 |
5.525% |
4.9725% |
|
<$75,000 |
6.37% |
5.733% |
|
<$500,000 |
8.97% |
8.073% |
New York, which also had a 8.97% top rate on income over $500,000, recently reduced theirs to 6.85% on income over $300,000 and 8.82% on income over $2 million. Christie’s office says the plan will be phased in over several years, through 2013. Hopefully they’ll round off a few of those decimal points too.
Share this article