Dear Legislator:
On behalf of the National Taxpayers Union's more than 10,000 members in New Jersey, I urge you to sustain the Governor's veto and oppose a $637 million income tax hike.
There is no question that New Jersey faces serious challenges right now. With a budget shortfall of nearly $11 billion, the state's deficit per capita is the largest in the country. New Jersey's public employee pension system is underfunded by an estimated $46 billion, and the state has already missed several payments, raising the risk of insolvency. However, an income tax hike will not solve these problems.
Despite recent income, sales, cigarette, property, and alcohol tax hikes, the state's deficit remains huge. New Jersey now has the highest state and local tax burden as a percentage of income, and the worst business tax climate in the nation. Income tax hikes are also notoriously unstable sources of revenue, as California and New York demonstrate. What's more, a recent boost in Maryland's income tax rates actually drove taxpaying individuals and businesses out of the state. Given the tax load New Jerseyans are already carrying, heaping more onto anyone's backs (especially in this recession) makes absolutely no sense.
Instead of raising taxes to close the budget gap, the state needs to cut its spending to a manageable level and reform its burdensome tax code to spur economic growth. Many areas of potential savings exist. For example, 1,600 entities comprise the government, many of which can be combined or eliminated. Additionally, property taxes should be capped to encourage more predictable and prudent budgeting. This recession has forced New Jerseyans to prioritize their expenses and then cut what they cannot afford. It is only reasonable for their government to do the same in crafting the 2010-2011 budget.
Whether the hammer falls on the so-called "rich," the poor, or some other group of taxpayers, taking more from New Jerseyans is unwise, unsustainable, and unacceptable. Our members hope you will recognize this reality, uphold the Governor's veto, and begin work on some long-overdue spending restraint. Our team is ready and willing to assist you in this vital task.
Sincerely,
John Stephenson
State Government Affairs Manager