Corzine Blinks, New Jersey Budget Deal Reached
Democrats have reached a deal on New Jersey’s budget. More details to follow, but basically Jon Corzine blinked and caved into Assembly Democrats. The agreement includes the sales tax increases that Corzine wanted, but at least one-half won’t be used to help close that budget gap you hear so much about.
For the sake of the argument, let’s assume 100 percent of new sales tax revenue goes for property tax relief. And let’s also assume you’re a member of that average family. So you’re going to pay $275 more in sales taxes to, cross your fingers, get an additional $275 back in property tax relief.
But the budget deal calls for half of the money raised from the sales tax rate increase to be used to lower property taxes this year, and all of it to go for that purpose next year. So you’re going to pay $550 more in sales taxes over the next two years to get, cross your fingers again, $421.50 back. Every year you’re going to pay that additional sales tax and every year you can hope you’ll get it back. Now there’s a victory for New Jersey taxpayers.
Just keep in mind, all revenue from New Jersey’s income tax, estimated to be $11.72 billion this year, must by law be used for property tax relief. How’d that deal work out for you?
We don’t know about you, but the cost of New Jersey property tax relief is killing us.
Senate Majority Leader Bernard F. Kenny said a potential deal started to come together after Assembly Democrats realized there wasn't enough support for an alternative budget plan they had offered Wednesday.So here’s how the deal is going to work. The average New Jersey family will pay an additional $275 with an increase in the state’s sales tax from 6 to 7%. The new budget deal will supposedly allow part of the additional sales tax revenue to go for property tax relief.
"Hopefully we'll get a budget passed this weekend," said Kenny, who was in meetings with the governor throughout the day.
The governor's staff didn't immediately know Thursday how quickly shuttered activities such as horse racing, casino gambling and the lottery would resume. The casinos stood to lose more than $16 million a day while shut down, and the state would lose an estimated $1.3 million a day in the taxes they normally generate.
For the sake of the argument, let’s assume 100 percent of new sales tax revenue goes for property tax relief. And let’s also assume you’re a member of that average family. So you’re going to pay $275 more in sales taxes to, cross your fingers, get an additional $275 back in property tax relief.
But the budget deal calls for half of the money raised from the sales tax rate increase to be used to lower property taxes this year, and all of it to go for that purpose next year. So you’re going to pay $550 more in sales taxes over the next two years to get, cross your fingers again, $421.50 back. Every year you’re going to pay that additional sales tax and every year you can hope you’ll get it back. Now there’s a victory for New Jersey taxpayers.
Just keep in mind, all revenue from New Jersey’s income tax, estimated to be $11.72 billion this year, must by law be used for property tax relief. How’d that deal work out for you?
We don’t know about you, but the cost of New Jersey property tax relief is killing us.
Posted by Enlighten-NewJersey @ 3:52 PM
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7 Comments:
Unbelievable.
Just unbelievable.
I don't read this as Corzine blinking but rather Joe Roberts losing. He kept announcing the sales tax was dead. Apparently it wasn't.
Codey proposed the "compromise" last week. Corzine would have signed that on Friday if it had been presented.
Roberts lost bigtime on this.
New Jersey, of course, lost even bigger. "Property tax relief" will become harder now that the Legislature doesn't have the sales tax to raise for the rebates.
And yes, you are correct in indicating there is no way we'll get back in rebates what we pay in sales tax. The difference (the inefficiency of the system) is slippage.
And the GOP was quiet yet again instead of hammering the stump about spending cuts. Tell me, what has changed? How are we better off?
We ain't.
What the democrats have done should not be considered a form of tax relief. There plan merely redistributes the tax burden and will not provide any substantial relief for hard working families.
Lets all hope that the citizens of New Jersey finally realize how dishonest the Democrats are.
We'd say Roberts got exactly what he wanted. Corzine claimed he needed the money from the sales tax increase to close the budget gap and to lay the foundation for reoccurring revenues to match recurring expenditures. Corzine wanted to address property tax relief later in the year after the budget had been passed.
Corzine has now agreed to use half of the sales tax increase for “property tax relief” this year and all of it for that purpose next year. How does this square with Corzine's plans and actions?
Here's a snip about Robert's maneuver to get what he wanted from June 27.
Tuesday, June 27, 2006 - By JOHN P. McALPINand MITCHEL MADDUX: TRENTON BUREAU:
“In a shrewd parliamentary move, Roberts also took the unusual step of drafting a bill to raise the sales tax and introduced it in such a way that he can engineer a direct Assembly vote on it, bypassing any committee hearing. The bill would tie any tax hike to politically popular property tax rebates.”
"I also have introduced legislation to increase the sales tax to ensure that any such increase is used specifically for purposes of providing property tax reform," Roberts said. "I will not post this bill – or any other bill to increase the sales tax one penny – for purposes of balancing the state budget."
Bob:
The GOP wasn't even allowed in the budget talks because the DEMS would not let them participate.
I understand the GOP had no clout in the statehouse. But there was a bank of cameras that they could have spoken to.
Would it have changed anything that happened? Nope.
But it would have laid the groudwork for taking back control. The NJ GOP is non-existent and this latest fiasco shows how irrelevent it is. Pounding the airways telling the citizens what should be happening as the Democrats bickered over how to raise our taxes would have been the right political move.
It didn't do it and it's because the GOP here has no clue.
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