Recently published editorial by State Director Laurie Ehlbeck
The following editorial by NFIB’s New Jersey State Director, Laurie Ehlbeck, was recently published in the Asbury Park Press:
If New Jersians paid all their federal and state taxes up front this year starting on January 1, they wouldn’t get any take-home pay until May 3. In other words, the taxes they pay are more than a third of what they make. And New Jersey’s tax burden is more than almost every other state in the nation. Only residents of New York would have to work longer to be free of their taxes. The Tax Foundation issues the Tax Freedom Day report to let hard-working Americans know just how long they must work to pay off their tax burden.
With such a big tax bite imposed upon all New Jersey residents, it’s troubling to know that Governor Phil Murphy is proposing to super-size that bite. One of his proposals is to increase the sales tax to 7-cents on the dollar. Need to spend $20,000 on a new car? The sales tax you pay would jump from $1325 to $1400 under the governor’s plan.
Middle-income small business owners will be especially vulnerable to another higher tax Gov. Murphy is proposing, incorrectly referred to as the “millionaires tax.” That’s because small business owners, unlike corporations, pay their business taxes through their personal income tax filing. So, even though they may not have a large income, and they usually reinvest the added business income back into the business, they could easily fall into that new tax bracket by default. It’s important for lawmakers who will vote on this new tax bracket to remember small businesses create about half the new jobs in the state.
The Tax Freedom Day report says that all Americans will spend more on taxes in 2018 than they will on food, clothing, and housing combined. Hearing that makes it even harder for hard-working people to want to get up and go to work, or for anyone to want to become an entrepreneur and start a small business.
The last thing New Jersey needs is for people to pack up and leave for a more tax-friendly state. Yet, a recent slide presentation by a Federal Reserve analyst showed a map for this district including Pennsylvania, New Jersey, and Delaware. New Jersey distinctively stood out in bright red – the color indicating the largest number of taxpayers leaving the state at more than 5-percent.
When lawmakers consider the Gov. Murphy’s tax increase proposals during this legislative session, I hope they remember just how hard New Jersey’s tax burden already falls on the people and small business owners they represent.
Laurie Ehlbeck is the New Jersey state director for NFIB, which represents thousands of small and independent businesses in the state.
