New Jersey Gov. Phil Murphy drew applause at the beginning of his budget address Tuesday before lawmakers in Trenton, when he thanked them for their concern about his health.
He also drew applause toward the end of his nearly 50-minute speech as he reeled off some highlights of his proposed spending plan for the 2021 fiscal year, which include modernizing infrastructure to eliminate lead water lines and providing $200 million to lower the cost for individuals buying health insurance plans through the Affordable Care Act.
But the applause died down significantly when Murphy called on the Legislature to extend his “millionaires’ tax” as part of the $40.85 billion budget. Neither Assembly Speaker Craig Coughlin nor Senate President Stephen Sweeney clapped as they stood behind their fellow Democrat.
Just as Murphy said, “I’m not going anywhere,” as he prepares for surgery to remove a kidney tumor, so too it appears that the governor’s push for more revenue from high-income earners isn’t going away anytime soon.
Two years ago, New Jersey enacted the tax applied to annual income of more than $5 million. Murphy now wants 2 percent of income exceeding $1 million. The governor said that tax increase, which would affect about 22,000 people, would lessen the load for the middle class, particularly when it comes to property taxes.
“Their tax burden is real,” Murphy said. “When put side-by-side with that of the wealthiest in our state, proves to be the exact opposite of fair.”
The budget calls for $1.26 billion in property tax relief, which includes increasing the property cap deduction and eligibility for a reimbursement program for seniors and the disabled.
Murphy added he’s also seeking to protect taxpayers by calling for reforms to the state’s open-ended corporate tax incentives program.
“Blank checks are bad policy,” he said. “No family budgets that way. Neither should we.”
Murphy introduced several initiatives in the budget. He’s calling on lawmakers to add $50 million for the “Garden State Guarantee,” which would enable New Jersey’s four-year public colleges to offer two years of free tuition – just like the state’s community colleges – to students with annual household incomes of less than $65,000.
He also wants businesses that don’t offer affordable health benefits or offer no insurance plans at all to their workers to pay a “corporate responsibility fee” to lessen the burden taxpayers face when workers must enroll in Medicaid.
“When these families turn to Medicaid, it’s our taxpayers who pick up their health-care costs,” Murphy said. “New Jersey pays an average of $1,000 per person, without any contribution by their employers.”
Those wanting to get a gun permit would see a fee increase. Murphy noted the $2 charge, which hasn’t increased in 54 years, is less than the cost to get a dog license. The gun permit fee covers the cost of the background check conducted by the state police.
Republicans assailed the proposed budget, noting that it’s growing faster than the state’s gross domestic product.
“His communications team has been working overtime to try and sell New Jersey residents on the idea that if we only tax people who can ‘afford’ it, he’ll have enough taxes to fund his radical, liberal agenda,” state Republican Chairman Doug Steinhardt said in a statement.
The state’s pension system would receive $4.6 billion in the budget. That’s a 13 percent increase from the 2020 budget and doesn’t include an extra $279 million payment the state will make later this fiscal year.
In addition to the expenditures, Murphy’s proposed budget also includes a projected surplus of $1.6 billion and projected savings of $566.8 million.
