A Tax Deduction for Union Dues but Not NJ Charities? - Garden State Initiative

A Tax Deduction for Union Dues but Not NJ Charities?


A Tax Deduction for Union Dues but Not NJ Charities?

William J. Smith, GSI Staff   |   June 22, 2023


Talk about misplaced priorities!

It was reported this week that Assemblymembers Anthony Verrelli (D-Hunterdon/Mercer) and Raj Mukherji (D-Hudson) have introduced legislation that would allow union members to deduct 100% of their membership dues from their state income taxes. The bill is a stark contrast to some legislator’s efforts over many years to allow Garden State residents to deduct charitable donations from their taxes.

As clearly articulated in a recent NJ.com editorial, public union dues fund multiple six-figure salaries for public union leaders.  And both public and private union dues are used to underwrite campaign and political action committees that may or may not be in the best interests of taxpayers.

While a price tag to New Jersey taxpayers did not come with this legislation, a similar effort in California left Golden State taxpayers with a $400 million bill. Nor is there a cap on the amount that can be deducted. A companion bill has also been introduced by Sen. Linda Greenstein (D-Mercer/Middlesex) in the Senate.

Our legislature in Trenton has failed for years to act on a bill offered by then-Senator and now Congressman Tom Kean, Jr.  (R-Union/Morris), to allow donations to charitable organizations (think food banks, homeless shelters) to be deductible on state income tax returns.  Given nearly 40 other states already allow this, Garden State charities continue to be disadvantaged and is just another reason why the Philanthropy Roundtable ranked New Jersey as third-worst state in which to operate a charitable organization.

Even a  bipartisan effort during the pandemic by Sen. Kean and Sen. Troy Singleton (D-Burlington), limiting the benefit to donations to New Jersey-based non-profits, passed unanimously in the Senate but failed to advance in the General Assembly.

Before this new bill advances further, Garden State residents, particularly those who rely on charities, should rightfully ask where their legislature’s priority lies – advancing the welfare of our state or funding their own political campaigns and union leaders salaries.