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NJSpotlight: 2020 Brings New Year, New Budget Planning — and Familiar Fiscal-Policy Issues
by John Reitmeyer
When it comes to the state budget, the new year is starting off with some unresolved fiscal-policy questions that have dogged Gov. Phil Murphy and fellow Democrats who control the Legislature since his tenure began two years ago.
For starters, Murphy remains at odds with legislative leaders from his own party on major tax policy, with the governor still backing proposed tax increases, including the establishment of a true millionaires tax and the restoration of a 7% sales tax.
Murphy and lawmakers are still locked in a stalemate over the future of major economic-development tax-break programs that expired over the summer, leaving New Jersey without any significant incentives to offer companies in exchange for new hiring and investment.
It’s also unclear how the governor and lawmakers plan to finance the next big increase in public-worker pension funding, which is scheduled to occur in the new fiscal year that will begin on July 1.
Further clouding budget matters is a decrease in the top-end corporate-tax rate that began on January 1 that is expected to reduce state revenues even as the governor and lawmakers have made a commitment to increase worker-pension funding. Also looming in the background are lingering concerns about a recession, something many New Jersey business owners fear is coming in the next 12 to 24 months.
Read the full story here.