State Tax Revenue Up $914 million
By Art Gallagher
New Jersey’s millionaires are sending an unexpected $913M to Trenton between now and July 2012, even though Governor Christie said no to the reinstatement of the millionaires income tax surcharge.
State taxes are expected to exceed Governor Christies projections by $430 million in the current fiscal year that ends June 30th, and another $484 million in the next fiscal year, according to an Office of Legislative Services analysis obtained by Gannett.
The money is coming from Wall Street millionaires’ income taxes.
As the stock market has risen broadly, the state saw an additional $633.9 million in income tax collections this fiscal year, and it is expected to reap another $811.7 million above expectations in the next fiscal year.
However, New Jersey’s Main Street economy is lagging behind expectations:
However, corporate business taxes are off early projections by $190.1 million and are expected to track $252.5 million below estimates next year.
Sales and other tax collections are flat or down and are expected to continue to be lackluster.
Naturally, Trenton Democrats are scrambling to find ways to spend the unexpected cash, rather than use it to shrink New Jersey’s huge deficits in the pension and health benefits system, the transportation trust fund or the unemployment trust fund. The State Supreme Court could order all the money be wasted in Abbot Districts.
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Shell Game
“New Jersey’s millionaires are sending an unexpected $913M to Trenton..”
Unexpected? Did you forget the taxpayer bank bailout that funded the record Wall Street bonuses for last three years.
You are correct that the Democrats have no interest in reducing spending or curtailing the unsustainable state pension programs.
However, workers wages are stagnant. Sales tax collection is down which happens when people do not have money to spend.
If Art is suggesting that this is a reason for not reinstating the millionaires income tax surcharge on the Lords of Finance working on Wall Street whose actions were instrumental to the recession, then turned around and had the taxpayers bail them out, well then good grief.
That’s not what I am suggestting at all, Christopher. But I think you already know that.
BTW, how much did your taxes go up to fund the bailout of the banks? 0.
The bailout wasn’t funded by our tax dollars. It was borrowed. It was funded by our children and grandchildren’s future tax dollars.
Not only is sales tax collection down, but coroporate income tax collections are below the budgeted expectation. Both are an indication that New Jersey based economic activity is weak.
Yet income tax revenues from millionaires is up almost a billion above expectations, even with the reduced rate that resulted from the expiration of Corzine’s surcharge.
Art is suggesting that if the sales tax rate and corporate income tax rate were lowered, revenue would increase.
Rick is wondering why Art is talking about himself in the third person.
Really, TARP was not a taxpayer funded loan bailout? Please explain.
I am young enough that my future tax dollars will most certainly be applied.
BTW, where did I write taxes have gone up? I did write “taxpayer bank bailout that funded the record Wall Street bonuses,” and “taxpayers bail them out.” No need to be so defensive, Wall Street can defend themselves.
I agree that the sales tax rate needs to be lowered, and will certainly help small businesses and families.
The following Bloomberg headline is one of many that can be found, this from 2008 “Goldman Sachs’s Tax Rate Drops to 1%, or $14 Million.”
Reading Dan Quayle’s autobigraphy he wrote that Bush could have won the election in 1992 if he came out with his suggested reduction of the corporate income tax. Quite silly.
We probably agree, more than we disagree, but my concern is with the people on Main Street, and not the millionaires on Wall Street who lecture everybody about free markets, and yes, as they take taxpayer funded bailouts.
Christopher,
TARP was funded by borrowed money.
Those who received the TARP funds have returned the money to the government, with interest, but the government has not repaid the money it borrowed to advance it to its creditors. So, future taxpayers will have to pay it back.
We probably do agree on more than we disagree. My concern is for Main Street too. Perhaps the original post was not clear enough in that regard.
We seem to disagree over the millionaires income tax surcharge in NJ. I don’t believe increasing tax rates in the millionaires will lead to additional government revenue, nor do I believe it will help the Main Street economy.
[…] noted that the poll was conducted before the latest state revenue projections were released. MMM doubts the revenue numbers would have a postive impact on the governor’s […]