By Christopher P. DePhillips
Democrat politicians continue to talk like they want lower taxes and lower spending, but they write and pass budgets that assault the pocket books of the middle-class by increasing taxes and spending by billions of dollars. They cannot separate themselves from our far-left governor.
Hiking taxes is hiking taxes, no matter whom or what is being taxed — it only takes money out of people’s pockets and out of the economy. For some reason, Democrats believe that our hard-earned dollars are better off being taken and spent by the government. The truth is that our hard-earned dollars are better off in our pockets than the government coffers.
Saying that the major tax hikes are on the people and companies that can afford it is a poor excuse and completely ignorant of New Jersey’s biggest economic problems. The fight of the budget season was over which tax is more harmful to the state: business taxes or millionaire taxes. Not surprisingly, but astoundingly, Democrats compromised to raise both.
New Jersey is ranked the worst state to own a business, a fact not changed by federal tax reform, yet the new state budget is accompanied by a new business tax that is now the second highest in the nation. New Jersey loses more residents than any other state and relies on people earning over $5 million for over 13 percent of tax revenue. When any of those taxpayers move out, it is the middle-class who picks up the tab.
This budget is a perfect example of that vicious cycle. It is supported by 18 tax hikes, including 12 regressive taxes that affect the lower- and middle-classes the most. Nothing is safe from taxes; not Uber and Lyft, online sales, going to rehab, health care, utility bills or even the plastic bag you get from the store to carry your purchase.
The budget is supported by tax hikes that won’t help anyone; that are only meant to support spending taxpayers already cannot afford.
Democrats in the legislature have the gall to tell everyone that they don’t want to hike taxes, especially on those who can least afford it, but then they go ahead and assault what little money people have left after managing to make ends meet in the most expensive state to live in the country. At least Governor Murphy is honest about making the state more expensive than it already is to support unsustainable spending increases.
In his recent op-ed in The Record, Senate President Steve Sweeney admitted that he and his Democrat colleagues were never far apart from Murphy on policy while negotiating the budget. They agreed to the regressive taxes and the major taxes.
For all of the Democrats’ talk of a fairer New Jersey, it seems as though their definition of fair is taxing everyone despite their income level.
The silver lining is that suburban schools will receive more money, but even that silver lining will fade sooner rather than later.
The new school funding plan passed by Democrats still deeply fails to provide equitable school funding by the time their long seven-year phase-in is finished. Right now, 56 percent of state aid goes to only five percent of school districts. By the end of the phase-in, that same five percent of districts will receive over 51 percent of state aid.
The increased aid to suburban districts is long overdue, but it won’t be nearly enough to stifle property tax growth. We need a new engine to drive education funding; finding a few spare parts is not good enough for the 95 percent of districts across the state that will continue to be shortchanged.
Throughout all of the tax hikes and spending increases, there was never a conversation about fixing the state pension system. New Jersey has the worst-funded pension system in the country. It was the main reason our state faced 11 credit downgrades.
The inconvenient truth is that the reforms made eight years ago weren’t enough. Taxpayers cannot afford to continue giving public employees incredible pensions and benefits that they cannot afford to give to themselves. And why should they?
Bipartisan pension and health benefit reforms recommended by a panel of some of the most respected financial experts in the state found more than enough savings to make a full payment. Instead, the recommendations continue to be ignored, and Democrats are hypocritically underfunding the pensions by over $2.1 billion – digging our financial hole deeper.
The problem we have is simple and every New Jerseyan knows it: taxes are too high and the cost of living is unaffordable. Tax hikes on the lower- and middle-class make New Jerseyans poorer and highest-in-the-nation business taxes don’t make the state more affordable.
The solution is to make the state more affordable for taxpayers, not the other way around.
Christopher P. DePhillips (R) represents New Jersey’s 40th Legislative District in the General Assembly.