New Jersey Policy Perspective: What’s the Rush? Costly Tax Changes Need More Deliberation
ITEP Work in ActionIn this atmosphere of emergency, some of the legislation is moving with less deliberation than might be expected of tax changes that, when fully implemented, would likely cost the state at least $400 million a year in lost revenue. That is in addition to declines in state sales and personal income tax revenue that New Jersey officials predict will result from the economic downturn.
Sparse information is available on who would end up paying more under these proposals and who would pay less. The potential effect on New Jersey’s already crippled state finances is not fully understood. For these reasons it would seem to make sense to take a deep breath and examine the total impact of these moves before acting. What follows is an analysis of how some of the business tax proposals would likely play out, and some ideas for reform that New Jersey should consider, whether or not the tax changes are made.