Thirty-seven New Jersey organizations representing hundreds of thousands of state residents are today sending a letter to the state legislature asking lawmakers to promote tax fairness for small, local businesses by closing corporate tax loopholes.
The letter, signed by a spectrum of community, labor, faith, environmental and social justice groups, shows widespread and deep support for what’s known as “combined reporting.” This treats the parent company and subsidiaries of multistate corporations as one entity for state corporate income tax purposes. Their nationwide profits are added together and the state then taxes the appropriate share of the combined income.
With recent enactment in Rhode Island and Connecticut, 25 out of the 45 states that have some form of corporate income taxation, plus the District of Columbia, now mandate combined reporting. In fact, this important reform has become so commonplace in other states that nearly all of New Jersey’s largest employers already use it when filing state taxes elsewhere, according to research by New Jersey Policy Perspective (NJPP), which has led recent efforts to enact combined reporting in New Jersey.
“This letter sends a strong message to New Jersey’s lawmakers: the time to close corporate loopholes is now,” said NJPP Deputy Director Jon Whiten. “The track record from across the nation is abundantly clear: this common-sense reform would help level the playing field for small and local businesses and raise significant new resources that New Jersey could invest in the building blocks of a strong state economy.”
A comprehensive bill to require combined reporting – as introduced by Senators Lesniak, Sarlo and Greenstein and Assembly members Holley, Eustace and McKnight – would raise up to $290 million a year in new corporate business tax revenue, according to the Office of Legislative Services. This shot in the arm is particularly timely, given that corporate tax revenues are flat at best as a result of New Jersey’s recent surge in tax subsidies.
The letter will be sent to all members of the legislature today.
Signers:
American Federation of State, County and Municipal Employees – Council 1
American Federation of Teachers – New Jersey
The Anti-Poverty Network of New Jersey
BlueWave New Jersey
Clean Water Action
Communications Workers of America – New Jersey
Communications Workers of America – Local 1032
Communications Workers of America – Local 1037
Communications Workers of America – Local 1081
Council of New Jersey State College Locals
Drug Policy Alliance
Environment New Jersey
Greater New Jersey Pride at Work
Health Professionals and Allied Employees
Housing and Community Development Network of New Jersey
Ironbound Community Corporation
Latino Action Network
Lutheran Episcopal Advocacy Ministry of New Jersey
The Main Street Alliance of New Jersey
Monarch Housing Associates
National Association of Social Workers – New Jersey
New Jersey Citizen Action
New Jersey Communities United
New Jersey Education Association
New Jersey Policy Perspective
New Jersey Public Interest Research Group
New Jersey Sierra Club
New Jersey State AFL-CIO
New Jersey Tenants Organization
New Jersey Work Environment Council
New Jersey Working Families
SEIU – New Jersey State Council
SEIU – 32 BJ
SEIU – Local 617
SEIU – Workers United
SEIU – Local 518
Unitarian Universalist Legislative Ministry of New Jersey
