Friday Facts and Figures: March 8, 2019

Friday Facts and Figures is a brief digital newsletter focusing on data points from NJPP reports, research, and policy debates in New Jersey and beyond.
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$38.6 Billion

It’s everyone’s favorite time of year: budget season! Earlier this week Governor Murphy gave his second budget address and unveiled a $38.6 billion spending proposal for fiscal year 2020. The governor’s budget makes the largest pension payment in state history and increases investments in education (pre-k all the way through college), NJ Transit, and the creation of affordable homes. To pay for these increased investments, the governor is proposing over $1 billion in savings (mostly in public employee health benefits) and applying the millionaires tax to — wait for it — all earnings over $1 million. Read NJPP’s lively rapid reaction (gifs included) here. [NJPP / Louis Di Paolo et al.]


$2.26 Billion

If you’re wondering why New Jersey needs to raise new revenue in this year’s budget, we have a simple answer for you: to make up for almost a decade of trickle down tax cuts. If it weren’t for the state allowing the millionaires tax to sunset, cutting corporate taxes, phasing out the estate tax, and cutting the sales tax, New Jersey’s FY2020 budget would have $2.26 billion more in revenue. This foregone revenue could have been used to fund critical programs and services, but instead it benefits the state’s wealthiest individuals and corporations. [NJPP / Sheila Reynertson]


29

The Earned Income Tax Credit (EITC) is one of the most effective policy programs at alleviating poverty. New Jersey is one of 29 states with its own Earned Income Tax Credit (EITC) to boost the incomes of low-paid families — but it could be better. Right now, workers under 25 years old are ineligible and workers not raising children are largely left out. Expanding the EITC to those 18 years and older, and boosting the tax credit for workers without children, would go a long way toward boosting the fortunes of young adults in high-cost New Jersey. [Center on Budget and Policy Priorities / Erica Williams and Samantha Waxman]


$700 Million

By all accounts New Jersey appeared to be facing a tax shortfall for the current fiscal year. But not anymore! A new revenue forecast by the Department of Treasury points to a balanced budget, thanks to a surge in corporate business tax (CBT) collections. The CBT is now projected to bring in $700 million more than previously anticipated, making up for a dip in income tax revenue. [NJ Spotlight / John Reitmeyer]


77 Percent 

Over the last year, the federal deficit has increased by 77 percent, in large part due to the 2017 federal tax overhaul and its generous tax cuts to wealthy individuals and corporations. Since the tax cut package was signed into law, taxes collected from individuals and corporations have continued to fall. The Congressional Budget Office estimates that, short of major changes to the tax code, the deficit will balloon to over $1 trillion a year from 2022 onward. [CNN / Donna Borak]


ICYMI

In non-budget news, the Star-Ledger has endorsed driver’s license expansion in a new editorial that cites NJPP’s research. The editorial also quotes NJPP’s Erika Nava, who said, “The bill is sound public policy, and hesitancy to move this forward is rooted in fear and lack of political courage, not the merits of the legislation.” The proposal to expand access to driver’s licenses would improve the lives of over 700,000 New Jerseyans. [Star-Ledger / Editorial Board]


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