Gov. Phil Murphy’s proposed millionaire’s tax, even with the promise of an additional $250 million of property tax relief in return, is still dead on arrival, the state Legislature’s top lawmaker said Tuesday.
“For this governor, a millionaire’s tax is just a talking point,” Senate President Stephen Sweeney, D-3rd District, said in a Tuesday afternoon statement. “We need a real budget with long-term, sustainable property tax savings, not gimmicks.”
Sweeney’s comments come less than a day after Murphy proposed a deal to Democratic lawmakers, while at a town hall-style meeting in Ewing, offering $250 million in additional property tax relief in the upcoming budget in return for the millionaire’s tax.
The governor’s office did not immediately return a request for comment.
Murphy’s spending plan for the 2020 fiscal year, which starts July 1, calls for $283 million for the Homestead property tax credit program and $202 million for the Senior Freeze property tax relief program, and this additional $250 million would be added into that pot. The state’s average property tax bill hit $8,676 last year.
The governor’s millionaire’s tax calls for increasing the income rate from 8.97 percent to 10.75 percent for every dollar earned above $1 million; which is expected to earn the state roughly $448 million annually.
Murphy tried unsuccessfully to push for the increased tax rate last year but met strong resistance from Democratic lawmakers, including Sweeney. Instead, both sides agreed to a mega-millionaire’s tax rate of 10.75 percent on those earning more than $5 million a year.
Murphy’s new deal, presented Monday night, was emboldened by what he said have been considerably strong revenue collections – which he called a “pleasant surprise” – that would make up for the revenue shortfalls from earlier in 2019.
Sweeney shot back at Murphy’s optimism, saying the increased revenue came from a four-year increase to the corporate business tax, which Sweeney was successful in pushing through despite objections from Murphy.
“The unexpected surge in revenues the Governor is now claiming is the surge the Legislature expected when we imposed a 2.5 percent surcharge on the millionaire and billionaire corporations that benefited directly from the Republican Congress’ tax cut,” Sweeney said.
“It is the corporation business tax surcharge we imposed that has been coming in far over the administration’s revenue projections – just as the legislature said it would,” he added.