Bergen Record: News Immigrant tax study sees $81M gain for N.J.
media mentionTuesday, July 9, 2013
BY MONSY ALVARADO
New Jersey immigrants living in the country without legal permission are paying sales tax, and some pay property taxes and even personal income tax.
Those state and local taxes totaled $476.4 million in New Jersey in 2010, and could increase by $81 million if Congress passes a sweeping immigration reform bill that would allow such immigrants to work legally, says a study released today by the non-profit Institute on Taxation and Economic Policy.
The study found that New Jersey’s immigrants living here without legal permission are paying $58 million in personal income taxes, $95.1 million in property taxes and $323 million in sales and excise taxes.
“People will be surprised at the level of taxes currently being paid. It’s a half a billion in New Jersey. That’s a significant amount of money, and of course that’s done through the sales tax, but it will grow,’’ said Gordon MacInnes, president of New Jersey Policy Perspective, a left-leaning non-profit Trenton think tank that co-released the report. “I think it will help blunt the argument that this is a giveaway and unfair to taxpayers, which are some of the arguments that are heard in opposition to immigration.”
The study is the latest of several reports released this year nationwide on the economic impact of immigration reform, which has been debated heavily by lawmakers. Last month, the U.S. Senate passed an immigration reform bill that creates a path to citizenship for an estimated 11 million immigrants in the country illegally. A similar House bill is pending .
Most of the reports have listed the economic benefits of immigration changes, including a Congressional Budget Office report, which found that immigration reform would bring in additional taxes and reduce federal deficits by about $200 billion over the next 10 years, and about $700 billion in the second decade. That study also found that many workers pay federal taxes, but that millions more would pay payroll taxes once they obtained legal status.
But at least one conservative group, The Heritage Foundation, released a study with a sharply different outlook. Robert Rector, a senior research fellow at the organization, concluded that the bill would end up costing the country more in benefits than the tax revenue it would collect. Rector, who said his study looked at tax revenue, and the cost of benefits such as public education and fire services, as well as the cost of federal benefits for the next 50 years, concluded that the bill would produce at least $6.3 trillion in deficit.
“Under current law, the typical undocumented household receives $25,000 a year in government benefits and services, and they pay about $10,000 a year. … There is a deficit there,’’ he said. “When you take all the illegal households, they cost the taxpayer … about $54 billion each year, that’s the total benefits they receive minus the total taxes they pay.”
MacInnes said that if immigration reform is passed, immigrants will be on a more secure track and be able to invest in various ways.
“Undocumented workers are here because they want to work, and they don’t expect anything by way of a free ride. They are here because they know that there are jobs for them here, whatever their skills are,’’ he said.
The report released today looked at data from all 50 states and found that overall, immigrants living in the country illegally are paying an estimated total of $1.2 billion in personal income taxes, $1.2 billion in property taxes and $8 billion in sales and excise taxes.
In New Jersey, the report states, income taxes paid by workers living in the country illegally would more than double under immigration reform, increasing to $117 million a year from $58 million.