By Samantha Marcus | NJ Advance Media for NJ.com
Gov. Phil Murphy got an earful from some taxpayers at a town hall Thursday night, the third road show for his $37.4 billion budget.
"This state is too expensive, and you're making it worse," said Greg from Freehold, who was likely speaking for many.
He was talking about the more than $1.5 billion in new taxes the Democratic governor is proposing in his first budget, including an increased and expanded sales tax and higher taxes on millionaires. He also wants to close loopholes that would extract additional revenue from multi-state businesses and hedge fund managers.
Of course, $1.5 billion is a big number. But how much would the tax increases really cost you?
We tried to figure it out.
That sales tax hike is the one to hit the greatest number of New Jerseyans. Just how hard depends what and how much you buy. Others hit you if you're rich, will be smoking legal weed or use some services like Uber.
None of this has happened yet because Murphy first needs the OK from reluctant fellow Democrats in the Legislature.
So using some admittedly inexact estimates, let's see how much Murphy's budget could cost you.
Sales tax
Most people don't pay much attention to the sales tax until they're making a big purchase, like a car. So don't be shocked if you didn't notice that starting Jan. 1, it was cut from 6.875 percent to 6.625 percent. That was after a drop the year before from 7 percent to 6.875 percent.
Murphy wants to reverse those cuts, bringing the tax rate back to 7 cents on the dollar.
During the debate over that tax cut, which was part of a deal to raise taxes on gas, New Jersey Policy Perspective provided some estimates on how much households would save, based on their income.
Here, we'll take those in reverse to reflect the increased cost to you each year:
* For a household income of less than $25,000, you could expect to pay another $32 a year.
* Between $25,000 and $49,000, $61 more a year.
* Between $49,000 and $79,000, $86 more a year.
* Between $79,000 and $132,000 a year, $116 more a year.
* Between $132,000 and $286,000, $152 more a year.
* Between $286,000 and $808,000, $255 more a year.
* And for the top 1 percent of households, those with income above $808,000, $723 more a year.
Samantha Marcus | NJ Advance Media for NJ.com
Millionaires tax
Murphy's proposed new marginal gross income tax rate would kick in for the first dollar people make over $1 million.
The vast majority of New Jerseyans won't pay this increased tax. But, according to the Department of Treasury, about 20,000 residents and 19,000 nonresidents will.
Murphy wants to raise the tax rate on this income from 8.97 percent to 10.75 percent. This nearly 2 percentage point increase is expected to drum up about $765 million in new revenue.
How much will it cost some of the richer among you?
Let's say your household income was $2 million last year. Forget 401(k) contributions and deductions. At the current marginal tax rate of 8.97 percent on income over $500,000, you would have paid around $162,000 in state income taxes.
With a top marginal tax rate of 10.75 percent on income over $1 million, you would now pay $180,000 for $2 million in household income.
Democratic lawmakers aren't crazy about the tax so far, but if they do eventually sign on, don't think you'd get a break because the year is already in progress. It would be retroactive to Jan. 1.
Marcio Jose Sanchez
Marijuana tax
Marijuana isn't legal in New Jersey, so as of now, any consumption is, well ... tax free. But if Murphy gets his way, it will not only become legalized — but taxable.
He would tack on a 25 percent excise tax and it would be subject to the proposed 7 percent sales tax, for a total of 32 cents on the dollar.
A joint report from the American Civil Liberties Union and New Jersey Policy Perspective estimated New Jerseyans consume 2.5 million ounces of pot each year and pay an average of $343 per ounce. Legal weed may bring the price tag down, but we'll assume for the minute that it's the same.
Many New Jerseyans are casual users, consuming about 1.2 grams per month, according to the report. That's about half an ounce a year, setting you back $174 untaxed. But the new excise and sales taxes would add $55.75 to your tab.
But say you are one of the 77,571 or so people who consume 44.8 grams per month. These new taxes are going to cost you. You're consuming about 19 ounces a year, with an estimated price tag of $6,504. Murphy's marijuana taxes will jack up your annual spending by $2,081.
(NJPP's consumption data is based on the U.S. Department of Health and Human Services' National Survey on Drug Use and Health.)
Taxing your Airbnb
This is where you'll find one of the many differences between former Gov. Chris Christie and Murphy. Just last July, Christie axed Democratic efforts to impose sales taxes and occupancy fees on Airbnb stays.
Murphy, however, wants to make those short-term housing rentals subject to the sales tax.
So that $175-a-night condo in Cape May with beach views might cost you $187.25. And that $413-a-night private room in Hoboken will be $441.91.
AP File Photo/Seth Wenig, File
Uber/Lyft taxes
Regardless of whether you prefer Uber or Lyft, you're going to pay more for your ride under Murphy's budget proposal.
Murphy proposes to expand the sales and use tax to include ride-hailing services.
A 2016 Pew Research Center study found only 15 percent of Americans have ever used one of these services. Riders tend to be younger and live in urban areas. So this may not affect you at all.
A separate study by Motherboard and online lending startup Earnest found the median monthly spending on Uber was $95 and $75 on Lyft. So that median annual tab of $1,140 on Uber would carry $79.80 in sales taxes. And that $900 yearly Lyft tab would be $63 higher.
Obviously you'll pay more if you use these services more frequently.
But most people probably don't have any idea how much they spend on transportation per year. So let's look at an individual ride.
Say it's 2:10 a.m. in New Brunswick and you've missed the last bus back to Busch Campus in Piscataway. Your Uber ride from Stuff Yer Face via uberX might cost you $8. With a 7 percent sales tax, you're looking at a 56 cent sales tax.
Or if you're heading out from your apartment in Montclair to the Brownstone Diner in Jersey City, you might shell out $35 to Uber. The sales tax will bring that to $37.45.
E-cigs and tobacco
The governor also wants to mimic a Democratic bill in the Legislature to impose a 75 percent wholesales sales and use tax on e-cigarettes. He would also raise from 30 percent to 68 percent the wholesales sales and use tax on tobacco products.
That tax proposal includes a $2.70 tax on each cigar and 54 cents on each cigarillo at the wholesaler or distributor level. Pipe and smoking tobacco would be taxed at $4.15 per ounce, under that bill (S1184).
Brent Johnson | NJ Advance Media for NJ.com
Murphy's not raising them, but everyone worries about property taxes
In that exchange with Murphy, Greg from Freehold laments that his property taxes have doubled since he and his wife bought their home in 2001.
Now, property taxes are not a state tax, though state lawmakers and the governor can do a lot to make them better or worse.
Murphy isn't proposing much as far as property taxes go, but he is increasing direct aid to schools by $283 million. This is less money the local districts have to raise from property taxpayers to balance their budgets, but there's no guarantee they won't anyway.
There's still a 2 percent cap on how much municipalities and counties can increase spending each year.
But you can bet New Jersey will still top the nation's list of highest property taxes.
Read more about the Murphy taxes
A man confronted Phil Murphy on taxes. Here's how he responded.
Here are all the taxes Phil Murphy wants to raise
Phil Murphy Mailbag: Is he raising taxes on everything?
Phil Murphy defends Jersey against 'cheap shot' from Texas over taxes
Samantha Marcus may be reached at smarcus@njadvancemedia.com . Follow her on Twitter @samanthamarcus. Find NJ.com Politics on Facebook.
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