Support builds for N.J. tax holiday to combat COVID-19 economic downturn

Support builds for N.J. tax holiday to combat COVID-19 economic downturn

TRENTON, N.J. – New Jersey’s economy was one of America’s least-robust before COVID-19 hit the nation’s shores. Now some members of the legislature are pushing to incentivize economic activity – or at least less the blow of a major drop off – before things go too far.

Last week, freshman Assemblyman Brian Bergen (R-25) called for legislators to suspend the state sales tax for the duration of the current state of emergency. Democrat Senate President Steve Sweeney got on board over the weekend and a press announced his support for a tax holiday along with other measures including a suspension of the payroll tax. Work in person waivers and a tax extension deadline are also on the short list of Sweeney-backed legislative options expected to be discussed in Trenton this week.

“Why not add this bill to Monday’s agenda and speed up the timeline for Senate approval,” asked Bergen. “With the support of Senate President Sweeney we can make the tax holiday a reality fast enough to bring relief when we need it.” 

Brian Bergen

Bergen plans to introduce his own sales tax bill on Monday

“Twenty-five bills have been drafted in the last 48 hours to be considered at an emergency session of the Assembly on Monday,” added Bergen.  “Those bills cover a variety of issues but do little to support the business community. Our business communities are on the brink of serious hardship and we need to address those concerns immediately.”

“As the number of COVID-19 cases continues to rise in New Jersey, the Chamber of Commerce Southern New Jersey (CCSNJ) is extremely pleased to see government proactively thinking of ways to help businesses mitigate the inevitable economic uncertainty they are facing,” said Christina M. Renna, president & CEO, Chamber of Commerce Southern New Jersey following Sweeney’s decision to support business-oriented relief measures. “The financial consequences facing the state will be significant if COVID-19’s impact continues to grow as expected. The CCSNJ supports any initiative that will provide additional flexibility for companies and their employees, as well as any measure that can provide some relief to operations while continuing to make the health and safety of customers and employees top priority.”

It’s unclear whether Governor Phil Murphy, who just proposed a record breaking nearly $41B FY 2021 budget, would be willing to sign off on any of the tax holiday ideas currently being advanced.

The National Federation of Independent Business (NFIB) announced Friday that 23% of small business owners are reporting negative impacts while 3% report increased activity. 39% of those negatively impacted say they’re experiencing supply chain disruptions and 4% say they’re grappling with sick employees; 42% say they’re experiencing decreased sales.

New Jersey’s general sales tax rate is currently 6.625%.