TRENTON, N.J. – New Jersey may be one of the hardest hit states if Joe Biden is elected and he’s able to get his tax agenda through Congress.
According to an analysis by the Tax Foundation, the top of the income scale would see their combined federal and state/local statutory income tax rates reach 60.1%, the highest its been in three decades.
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Biden’s plans included an increase in earners’ top marginal tax rate (from 37% to 39.6%) and an additional payroll tax (12.4%) for earners making over $400,000 annually. The final damage: a new federal tax top rate of 49.338%.
New Jersey’s top state income tax rate is already 10.75% for anyone earning over $1 million annually.
The impact extends beyond the wealthy and “upper” Middle Class, even when accounting for the fact that effective tax rates will remain below statutory tax rates due to credits, loopholes, and other variables baked into the country’s complicated tax code.
“According to the Tax Foundation’s General Equilibrium Model, the Biden tax plan would reduce GDP by 1.47 percent over the long term,” explained the Tax Foundation in its analysis. “On a conventional basis, the Biden tax plan by 2030 would lead to about 6.5 percent less after-tax income for the top 1 percent of taxpayers and about a 1.7 percent decline in after-tax income for all taxpayers on average.”
Click here to read the full report.
