Topic Category: Tax and Budget

Vote ‘Yes’ on Ballot Question 1

Posted on by Gordon MacInnes

This op-ed was published in the October 31 edition of NJ Spotlight.

The book a friend mentioned as riveting was published in 1958. Your 4-year-old loves stories and playing with her peers, but you’re new to the neighborhood. You keep hearing about how helpful yoga is, but have never tried it. The story is your great uncle fought in the Korean War – or did he? How did Elijah Stoner build that nice house downtown in 1820? Your kid wants to learn chess, but you’re no good at it. Or how about a safe, fun place to celebrate Halloween?

To find satisfaction on these and thousands of other quandaries, New Jerseyans made about 45 million trips to their local public libraries last year. In fact, every single day over 120,000 people visit a New Jersey library. Some went to check out books or facts; others to look for jobs and better economic opportunities; others to hear lectures or discuss books; and still others to take part in civic community-building. The range of services and events across the state is vast. Yet despite their importance to our communities, New Jersey’s libraries are in need of a little TLC.

That’s where you come in. On November 7, you can help update and modernize the state’s public libraries by voting “yes” on Question 1. If approved, the Library Construction Bond Referendum will authorize $125 million to fund renovation, modernization and construction projects at libraries across the state. The dollars would go to local libraries in the form of grants that will provide 50 percent of the funds required for construction and renovation projects, with the balance being matched by the libraries themselves.

Public libraries are community-gathering places that have transformed themselves to accommodate a changing society and electronic communications. Yes, you can still check out a book (or a CD), ask for guidance from the reference librarian, hold a meeting, attend a discussion group or story hour or hear from a local author, but public libraries have adapted to new demands and needs. Some libraries offer computer classes in Spanish and ESL classes to assist our growing Latinx population. What has not changed is the uniform courtesy and helpfulness of librarians or the quiet, welcoming atmosphere.

However, the transformation is not complete and much more needs to be done. There are 420 public libraries in New Jersey, ranging from 4 in Salem and Cumberland counties to 62 in Bergen. Most offer hours to match residents’ busy schedules, but many have had to reduce hours because of municipal and county budget cuts (one branch library in Cape May is now open only 4 hours per week; Princeton’s is open 75 hours).

In many libraries wifi and high-speed internet connections are available, but half of New Jersey’s libraries need to upgrade their electrical systems to accommodate better computer access. Many municipal libraries were built early in the 20th century and 40 percent are not yet accessible to the disabled under the Americans with Disabilities Act. To be accessible to all, some older libraries need to install elevators and make interior spaces more accessible. And a New Jersey Library Association survey this year found that about half of libraries have outgrown existing space and need help to expand.

Approval of Question 1 would help with all of these improvements, helping to update and enhance public space and buildings; make libraries more accessible and spur innovation.

In this increasingly contentious atmosphere, libraries remain one of the last vestiges of the public sphere. The importance of New Jersey’s libraries is not in doubt. But their future is. Let’s all take a step to ensure our libraries have a better chance at continuing to grow with our state and our society by voting “yes” on Question 1.

Trump Budget & Tax Plan Would Hit New Jersey Hard

Posted on by Sheila Reynertson

This op-ed appeared in the Sunday, October 29 edition of the Asbury Park Press.

This week the U.S. House of Representatives passed a budget resolution that brings Congress one step closer to enacting $1.5 trillion in unpaid-for tax cuts largely for the wealthy and profitable corporations while making low- and middle-income New Jerseyans foot the bill. The budget sets up a fast-track, partisan process for passing the Republican tax plan with just 51 votes, the same process they used to try to force through the repeal of the Affordable Care Act.

The bright side is that 11 of New Jersey’s 12 House members voted against this dangerous budget plan. Those leaders in D.C. – particularly GOP Reps. Leonard Lance, Frank LoBiondo and Chris Smith – should be applauded for putting the people of New Jersey first with their “no” votes, and should be urged to remain steadfastly opposed to a budget and tax plan that is skewed to the very wealthy, raises taxes on many New Jerseyans and sets up deep and damaging cuts to critical public services and investments on which all of us rely. (While Rep. Tom MacArthur voted “no” this week, he did help set the process in motion with a “yes” vote on the budget resolution earlier this month.)

Rep. Rodney Frelinghuysen, on the other hand, was the lone “yes” vote from New Jersey, thinking perhaps that the “tax reform” plan pitched by President Trump and his allies in Congress will help working families across the country. But New Jersey families have a right to ask him: Really? How so?

The plan is clearly skewed to benefit a small group of wealthy taxpayers, shareholders and profitable corporations, with very little left to benefit the middle class and everyone else. And the massive loss in revenue caused by these tax cuts would blow a hole in the nation’s finances to the tune of $234 billion as soon as next year, according to the Tax Policy Institute.

Anti-tax activists claim these huge cuts for the top will unleash a torrent of economic growth, thereby ensuring no real “cost” from the tax breaks – and no real pain for the American people. But history clearly tells another story.

Trickle-down economics has been disproven and debunked again and again – mostly recently in Kansas, which retreated in defeat after generous tax cuts tilted to businesses and the wealthy failed to deliver promised widespread prosperity to the Sunflower State. As the Kansas experiment vividly shows, tax cuts like these don’t lead to growth – they only lead to dried up budgets and cuts to education, health care and other vital programs that help working families.

The Trump-GOP plan, in short, is rooted in magical thinking. But it’s worse than a fairytale: for many New Jerseyans, it’d be more like a nightmare.

New Jersey’s wealthiest families would be the only real winners under this plan. A whopping 82 percent of the plan’s tax cuts would got to New Jersey’s richest 1 percent, with an average tax cut of approximately $74,000, according to the Institute on Taxation and Economic Policy. Meanwhile, about one in four New Jerseyans would face a tax hike, paying an average $2,400 more each year.

Whatever meager tax break is given to low-income and middle-income New Jerseyans would inevitably be wiped out by cuts to public services and programs that those families rely on like health care, education, food assistance and much more. To be clear, the very programs that help everyday New Jerseyans make ends meet and move up the ladder of opportunity are the currency with which the Trump administration and Congressional leaders hope to pay for huge tax cuts for those who are already doing quite well.

New Jersey taxpayers across the state would be hit especially hard if the widely used deduction for state and local taxes is eliminated. It would especially blow a massive hole in the wallets of New Jersey middle-class taxpayers.This proposal is not tax “reform.” It’s a giveaway to those who already benefit the most in this rigged economy: the very wealthy and large, profitable corporations. And pairing these tax breaks with deep cuts to economic security programs would only make today’s runaway inequality worse.

Real tax reform would help New Jersey’s low- and middle-income families that have been hit hard by the state’s sluggish economic recovery. Real tax reform would ensure that we have the resources to invest in the things that are proven drivers of a strong economy like education, health care and infrastructure. Real tax reform would stop providing special treatment for the wealthy and start investing in the assets that only the government can make in the coming decades to meet the public’s needs.

Unlikely Allies Oppose Mega-Subsidy for Amazon

Posted on by NJPP Staff

New Jersey Policy Perspective joined forces yesterday with Americans for Prosperity-New Jersey to oppose the state’s main bid for Amazon’s new headquarters: a bid for the city of Newark fueled by an estimated $7 billion in tax breaks. NJPP and AFP-NJ were joined by Assembly Deputy Speaker John Wisniewski and the American Legislative Exchange Council, making for a case of strange bedfellows in the State House.

“The groups convening today’s press conference don’t agree on much when it comes to tax and economic policy,” NJPP Vice President Jon Whiten said, “but we are in absolute agreement that offering $7 billion in tax breaks to a single corporation is terrible policy and a big step in the wrong direction.”

More from the press event, from NJTV News:

New Jersey’s Tax Code is Broken. Let’s Start Fixing It.

Posted on by Jon Whiten

This op-ed appeared in the October 13, 2017 edition of the Star-Ledger, the Times of Trenton and the South Jersey Times. 

With taxes taking center stage in this year’s race for governor, it’s important to take a few steps back and think about the role that taxes play in building a strong state and future. You see, taxes aren’t an end of their own – they are, in fact, a means to an end: shared investments in our shared priorities.

And make no mistake: today New Jersey simply does not have the resources to ensure that the state is meeting the needs of all its residents while laying the groundwork for a thriving economy.

This is not an accident. Decades of anti-tax rhetoric from lobbyists for the wealthy and well-connected have led New Jersey policymakers to cut taxes over and over again – mostly for the state’s most well-heeled families, large corporations and wealthy heirs – all in the name of making the economy “competitive.” But over those same decades, our economy has stagnated, in large part due to the state’s inability to maintain its core economic assets (take NJ Transit, for instance) and its accelerating creep toward insolvency.

And these choices have made New Jersey’s tax code less fair by shifting the overall tax burden to middle-class, working-class and low-income families.

In 2018, New Jersey’s leaders must begin making better choices. Here’s how they can start fixing our broken tax code:

Make the income tax fairer and more effective

In late 2009, the lame duck legislature allowed New Jersey’s temporary income tax surcharge on the state’s wealthiest households to expire. Since then, the governor has vetoed numerous attempts by the legislature to make the Garden State’s income tax more equitable.

The result: the state has subsequently forfeited up to $7 billion in revenue, further enriching the state’s most well-off while cutting property tax relief for middle-class homeowners, increasing public transit fares and raising tuitions at the state’s public colleges to unaffordable levels.

Other states have not made these mistakes.

In fact, states like California, Minnesota, Maine and New York have enacted or extended substantial income tax increases on their wealthiest households, generating tens of billions of dollars to pay for schools, health care and more – and helping to foster strong economic growth.

New Jersey’s policymakers should add four new brackets to the state income tax code. This change would raise over $1 billion a year to invest in schools, property tax relief or other targeted investments, while only raising taxes for the wealthiest 5 percent of New Jersey families.

Restore fair and adequate taxation of inherited wealth

Last year, New Jersey’s political leaders delivered a huge gift to the heirs of the state’s wealthiest families – and a blow to everyone else – by eliminating the state’s estate tax. This change gives a few thousand wealthy heirs a huge tax break, while draining the state of over $500 million a year in lost revenue – dollars vitally needed to support investments with widespread benefits, like infrastructure and higher education.

Policymakers should bring the estate tax back – but with a higher threshold than before. At $1 million or even $2 million, the tax would still raise a substantial amount of revenue while affecting even fewer – and even wealthier – New Jerseyans.

Close corporate tax loopholes

New Jersey currently offers a tax loophole to large multistate corporations – one that hurts New Jersey-based businesses and costs the state money. Through this loophole, large multistate corporations can – on paper – shift profits they make in New Jersey to other states that have lower tax rates or no corporate taxation at all. Corporations often do this by creating “subsidiaries” that exist only for tax purposes.

Other states – 25, to be exact – have combated this charade by adopting a practice called “combined reporting.” And New Jersey should join them. Limiting the ability of profitable multistate corporations to use accounting tricks to dodge state taxes would help level the playing field for the state’s small and local businesses – and raise up to an additional $290 million a year to help the state pay its bills and make key investments.

Roll back the largely invisible 2016 sales tax cut

The tiny, undetectable sales tax cut approved by lawmakers last year will help the wealthiest New Jerseyans the most, save the average Garden State family less than $2 a week but do enormous, lasting damage to the state’s finances with an annual price tag of more than $600 million. This gimmicky tax policy should be reversed.

Tax Credit Delays Continue to Hurt New Jersey Families

Posted on by Brandon McKoy

The Earned Income Tax Credit (EITC) is a proven policy that helps workers who are not being paid enough to better afford their daily needs. In New Jersey, the over half million families that benefit from the federal credit are also able to get a state credit, receiving an important boost during tax time to the tune of $811 a year on average. Even that modest amount is crucial to help struggling working families in our  high-cost state; and New Jersey should be commended for being a national leader for its state EITC contribution.

The Christie administration’s recent efforts to clamp down on “fraud” in the program, however, are leaving more and more people in limbo, preventing them from receiving their tax refund in a timely manner – refunds that many families rely heavily upon to take care of bills, repairs, and basic needs. And these delays couldn’t come at a worse time, as the Garden State continues to battle with stubbornly high poverty rates that endanger the health and prosperity of everyone,.

Since the state began its “enhanced screening” process in 2011, the tax refunds of hundreds of thousands of low-income working families have been significantly delayed or denied. In fact, this policy has caused the average number of taxpayers with pending or denied EITC claims to nearly double, rising to an average of 85,690 a year (2011-2016) from 44,232 (2009-2010) – and it’s caused the total average annual amount of EITC dollars pending or denied to increase by 147 percent, to about $65 million a year (2011-2016) from about $26 million a year (2009-2010).

In the meantime, real New Jerseyans are suffering as they go without vital refunds that they rely upon to afford important needs. The rate of true poverty – 200 percent of the federal poverty level, or about $48,700 for a family of four in 2016 – in New Jersey has remained stubbornly high for the past several years, measuring higher than 23 percent since 2010 and hitting 23.7 percent in 2016. As the state’s economy has slowly recovered from the Great Recession, too many working-class New Jerseyans are being left behind. Launching a punitive – and misguided – policy that prevents these families from receiving important tax refunds in the middle of a poverty crisis is severely harmful.

State officials have justified this change by citing the error rate of the EITC – the IRS estimates between 22 and 26 percent of EITC filings contain errors – but there are better, less draconian ways to deal with this issue.

The IRS itself refers to this problem as an “improper payment rate” rather than “fraud,” because most filing errors are unintentional, not malicious. Enacting error-reduction proposals approved by the federal Treasury Department – such as simplifying the rules around who can apply and working with commercial providers to reduce errors in the returns they submit – would do more to reduce the numbers of false claims than targeting taxpayers. In short, the state should take every step possible to mitigate the error rate without putting low-income residents in limbo.

Over the course of the past several years, the Garden State has experienced worsening economic inequality, stubbornly high poverty, stagnant household income and frustratingly slow job growth when compared to our neighbors and the nation. To withhold over $90 million in total from the state’s most vulnerable families at such a time is seriously damaging. New Jerseyans deserve a government that can efficiently process tax returns so they can receive their refunds in a timely manner and address pressing economic issues in their lives. The state needs to determine and implement a plan that will end this situation before more vulnerable New Jerseyans are harmed even further.

House Budget Threatens Billions in Cuts for New Jerseyans to Set Up Damaging Tax Plan

Posted on by Jon Whiten

The 2018 budget resolution that the U.S. House of Representatives passed today would slash billions of dollars from programs that help Garden State families afford necessities and get ahead, according to a report by the Washington, DC-based Center on Budget and Policy Priorities. These damaging cuts pave the way for massive tax cuts for corporations and the very wealthy on the backs of working Americans. A budget resolution that would have similar, harmful effects on New Jerseyans is currently working its way through the Senate.

Both the House and Senate budgets set up a fast-track, partisan process for passing massive tax cuts for the wealthy and corporations. The GOP tax plan, released last week by congressional Republicans and the White House, would overwhelmingly benefit the top 1 percent in New Jersey, who would receive 82 percent of the tax cuts, a new analysis released by the Institute on Taxation and Economic Policy (ITEP) shows. New Jersey’s wealthiest 1 percent would receive an average $74,000 tax break each year while about 1 in 4 Garden State taxpayers would pay an average of $2,400 more in a year in federal taxes.

Not only would these tax cuts overwhelmingly benefit the very wealthy, they could also pile trillions onto deficits and likely force further cuts to health coverage and critical programs like education, and job training – and put more pressure on Social Security.

The bright side is that 10 of New Jersey’s 12 Congressional representatives, including a majority of its Republicans, voted no on the resolution (Reps. Frelinghuysen and MacArthur were the lone ‘yes’ votes from the Garden State).

Despite claims to the contrary, Congressional Republicans’ budget and tax plans would make life harder for working people across New Jersey. Instead of setting the stage for tax cuts that help those who need it the least and tax hikes that would harm so many in New Jersey, Congressmen Frelinghuysen and MacArthur should work to advance policies that invest in working families and boost the economy, while ensuring that tax cuts are paid for by closing tax loopholes or other responsible tax changes – not by running up the deficit and raising taxes on one in four New Jerseyans.

Despite congressional Republicans’ claims, their tax plan would do little to spur economic growth and at the same time would worsen the nation’s long-term fiscal outlook.

Kansans learned this lesson after Gov. Sam Brownback enacted a similarly drastic tax and budget plan in 2012. Following the cuts, Kansas lagged behind its neighbors in economic growth and job creation. The tax breaks created a budget shortfall of $900 million that sent the state’s finances into a tailspin and encouraged dangerous cuts to schools, road repair, and other key services that help working people and foster economic growth.

GOP-Trump Tax Plan Hits Many New Jerseyans Hard, Rewards State’s Millionaires

Posted on by NJPP Staff

FOR IMMEDIATE RELEASE: Oct. 4, 2017

Contact: Jon Whiten, whiten@njpp.org, 917-655-3313 or Jenice R. Robinson, jenice@itep.org, 202.299.1066 x 29

Under the “tax reform framework” released by the Trump administration and Congressional Republican leaders on September 27, New Jersey’s wealthiest 1 percent of taxpayers would receive an average $74,000 tax break each year while about 1 in 4 Garden State taxpayers would pay an average of $2,400 more in a year in federal taxes.

That makes New Jersey one of the hardest hit states in the nation, according to a new 50-state analysis of the tax plan released today by the Institute on Taxation and Economic Policy. In fact, the Garden State has the 2nd highest share of taxpayers who would see a tax hike under the Trump-GOP plan of the 50 states, at 26.4 percent. Nationally 16.7 percent of taxpayers would see a tax increase. (Maryland has the highest share, at 30.5 percent, while North Dakota has the lowest share, at 4.2 percent.)

While GOP leaders have pitched the plan as a tax cut for the middle class, the analysis shows that this is not true for New Jersey or the nation as a whole. While most New Jerseyans would, in fact, receive a modest tax cut, on average that cut would amount to less than one percent of their income. The wealthiest 1 percent of the state’s residents, by contrast, would reap a financial windfall, receiving 82 percent of the total tax cuts going to New Jersey while the bottom 40 percent of New Jerseyans would receive just 8 percent of the tax cut, and the middle 20 percent just 9 percent.

“Make no mistake: this proposal is not tax ‘reform’ – not by a long shot. It’s merely a package of huge tax cuts for those who are already doing well in this rigged economy: the very wealthy and large corporations,” said New Jersey Policy Perspective Senior Policy Analyst Sheila Reynertson. “And when this windfall for the top 1 percent is paired with the deep cuts to critical economic security programs like food assistance in the GOP budget, this merely makes today’s runaway inequality even worse.”

A greater share of New Jerseyans face a tax hike under the Trump-GOP plan than just about anywhere else because the plan would eliminate the state and local tax deduction, which disproportionately benefits high-service, high-tax states like New Jersey. Thanks in large part to the loss of this deduction, on the surface this tax plan hits the Garden State’s middle- to upper-middle-income families with significant tax increases. But it’s clear that the state’s low-income working families could also lose big, particularly when one considers the potential cuts to essential public services and safety net programs that are being taken up as companion measures.

“No matter how the GOP messages this plan, it is nothing more than an upward redistribution of wealth,” said Alan Essig, Executive Director of the Institute on Taxation and Economic Policy. “Not only does the plan boost the incomes of the wealthy with surgical precision, it also gives a pittance to most working people and it taxes some in the middle and upper-middle class more, essentially creating an even greater economic divide between the rich and everyone else.”

To Attract Amazon, New Jersey Needs Public Investments

Posted on by Gordon MacInnes

 

New Jersey would be an excellent choice for Amazon’s new headquarters. After all, we have bustling cities like Jersey City, Newark, New Brunswick and now Camden – plus strong road, rail, port, technology and airport infrastructure; a highly educated labor force; excellent public schools and a great quality of life. These are the key factors that can attract Amazon to the Garden State – not further expanding New Jersey’s overly generous corporate subsidies, as Gov. Christie suggests.

So-called ‘incentives’ are a stated factor in Amazon’s decision-making, but they are just one of many. If state economic-development officials focus narrowly on tax breaks, they will merely be repeating – and making worse – the mistakes New Jersey’s political leaders have been making over and over since the Recession hit. For New Jersey’s economy to truly be competitive and strong, the state needs to get back to basics: investing in the assets that give us an edge.

Whether that’s ensuring NJ Transit is reliable and affordable, strengthening the state’s public colleges and universities, or fostering smart, dense growth in walkable downtowns with more affordable places to live, these are the policy solutions New Jersey must highlight in an attempt to woo Amazon. Merely blowing the lid off already out-of-control corporate tax break policies won’t work – and is dangerous to New Jersey’s future to boot.

How To Help Families with High Cost of Child Care

Posted on by Holly Low

This op-ed appeared in the September 13, 2017 edition of NJ Spotlight.

When I heard that Ivanka Trump was pushing proposals to make child care more affordable, I was hopeful. A first daughter who knows what it’s like to juggle work and parenthood!

But when it comes to crafting policy, the devil’s in the details. And so far the details of President Trump’s child care plan suggest it will mostly benefit high-earning, dual-income households like Ivanka’s. While the administration is reportedly revising its proposal, and Ivanka Trump and Sen. Marco Rubio are pushing for a much-needed increase to the Child Tax Credit, we don’t know what the Trump team will ultimately get behind.

We do know, however, that under the initial proposal the most well-off Americans would enjoy nearly all the benefits – in fact, an estimated 70 percent would go to families earning $100,000 or more.

Instead of widening income inequality, lawmakers should target assistance to the low-income and middle-class families that need it most. They can start by improving existing systems that help working parents: the Child Care and Development Fund, the Child and Dependent Care Tax Credit, and the Child Tax Credit.

New Jersey families who earn up to 200 percent of the federal poverty level, or about $40,000 a year for a family of three, can receive direct subsidies for child care through the Child Care and Development Fund (CCDF). In New Jersey, this program assists 32,000 families every month so parents can work or go to school. (See childcarenj.com for more information.)

However, federal funding for the CCDF is at its lowest level since 2002. In New Jersey the subsidy falls below the prevailing market rate in every county, which can force families to choose providers based on price, not quality. A great start would be for the federal government to adequately fund this program – it’s the most direct way to help working families access quality care every month.

In addition to expanding direct subsidies, lawmakers should improve the tax credits that help cover child care costs. The Child and Dependent Care Tax Credit helps working families pay expenses for the care of children, adult dependents or an incapacitated spouse. In 2015, over 223,000 New Jersey tax filers received this credit. The amount depends on income; it can provide up to $2,100 and the average American family gets a $550 credit. This would reach more low-income families if it were made fully refundable. In addition, Congress should raise the low ceiling for expenses, which doesn’t reflect the true cost of care, and index these limits to keep up with rising costs of living.

New Jersey policymakers should also join the 24 other states that already piggyback on this federal credit and provide some relief for this legitimate working expense. The best way to target this to the neediest families is to make the credit the most generous for the lowest earners, decrease the value as income goes up, and cap it at a reasonable income ceiling.

Many poor and low-income parents can’t afford to pay for care (they’re more likely to rely on help from family and friends), and don’t have access to subsidies or free programs. One of the best things we can do for these families is boost their economic security with an increased Child Tax Credit. This credit currently provides up to $1,000 per child under the age of 17, and is fully or partially refundable if the credit exceeds the taxes owed. Almost 70 percent of families with children already receive it, so the Child Tax Credit would likely reach more of these parents, and it would support families who have a stay-at-home caregiver.

These are just some of the policies that can address the lack of access to quality, affordable child care in our country. In addition, we need expanded federal and state investments in high-quality preschool, which produces long-lasting positive impacts on children, supports working families, and has large economic benefits.

In the meantime, I hope Ivanka Trump will stay focused on the families who need assistance the most – it’s not just the moral thing to do, it makes economic sense too. When we help low-income families get ahead, and make it affordable for those middle-class mothers who want to work to do so, we support our workforce and grow our economy. It’s time for our country to treat child care as the fundamental economic building block that it is.

NJPP Charts a Course for Reforming State Income Tax

Posted on by NJPP Staff

By increasing income tax rates on New Jersey’s wealthiest households, the state could raise over $1 billion a year to help build strong communities and invest in working families across the state, according to a report released today by New Jersey Policy Perspective (NJPP). The report finds that New Jersey’s personal income tax has not kept up with the times, depriving New Jersey of resources needed to build widely shared prosperity.

Specifically, the NJPP report proposes adding four brackets to the state’s income tax and increasing rates on the state’s wealthiest 5 percent of households. The proposal is modeled on successful reforms put in place by California in 2012.

“Like California six years ago, New Jersey faces tremendous financial challenges. Our budget is stretched beyond capacity, we have chronically underfunded services that are critical to families in need, and we’ve failed to make the kinds of sound public investments in infrastructure and education that can ensure our economy is strong going into the third decade of the 21st century and beyond,” said Sheila Reynertson, NJPP senior policy analyst and author of the report. “This proposal alone will not solve the state’s fiscal crisis, but it is a substantial yet sensible step in the right direction.”

NJPP’s proposal would also combat growing inequality in New Jersey, where too few families prosper while too many families struggle to get by every day.

Today, the most well-off New Jerseyans hold a greater share of the state’s income than they have in nearly a century, thanks to decades of unequal economic growth, creating an off-balance economy in which many middle- and lower-income New Jerseyans face barriers to economic opportunity. In fact, New Jersey’s top 5 percent of households now have average incomes that are 15.6 times larger than the bottom 20 percent of households, ranking 7th in the country for income inequality. Recent state tax policy changes have exacerbated this trend, making it harder for New Jersey to foster the kind of investments that expand the middle class and help narrow that gap.

“Those at the very top, who have greatly prospered in the past decade, have a responsibility to pay their fair share and ensure our state and our society has a strong foundation for the future,” added Reynertson.

The report is the third of a series of NJPP reports digging into the details of state tax reforms that can help end New Jersey’s fiscal crisis while promoting shared prosperity and furthering economic justice in the Garden State, and it comes as the major-party candidates for governor continue to have a spirited public debate over taxes.

Earlier reports in the series:

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