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Gov. Phil Murphy

Murphy: Millionaire’s tax just a matter of time

Legislative leaders till oppose Murphy’s trademark proposal

By Nikita Biryukov, January 15 2020 12:53 pm

Gov. Phil Murphy could not point to any shifts within the legislature that would make his third push for a tax on the state’s millionaires more successful than his previous attempts Wednesday.

“Over time, water and other realities, including political realities, find their normal resting place,” Murphy said at an unrelated press conference. “And when you’ve got 70-something percent of the state, including a majority of Republicans, who think it’s a good idea. I’m optimistic we’ll get there.”

Murphy made a renewed call for a tax on high earners during his state of the state address Tuesday.

The reception from the lawmakers arrayed on the floor of the Assembly was icy.

Senate President Steve Sweeney and Assembly Speaker Craig Coughlin have opposed previous millionaires’ tax proposals, and there’s nothing to suggest they’ve warmed to the idea in the months since June, when the state adopted its last budget — one that did not include a millionaires’ tax.

Murphy’s lone victory on the issue came during his first year in office, when he managed to secure a higher tax bracket for New Jersey residents making more than $5 million per year.

It’s possible that legislators will be more open to raising taxes with the next state-level election not coming until 2021, but even that’s no guarantee, especially given that the level of vitriol between Murphy and Sweeney doesn’t appear to be receding.

The governor is hoping, in part, that the uses for revenues from the millionaires’ tax can help convince legislators to pass the measure, which was a core part of Murphy’s 2017 campaign platform.

“We’re putting it, in some combination measured in hundreds of millions of dollars, in direct property tax relief in the middle class and, secondly, the increased investments that we want to make in public education,” he said. “So, the use of proceeds are showstoppers. They’re unassailable.”

In New Jersey, revenues from state income tax are constitutionally dedicated to property tax relief.

He also said a tax on the state’s high earners would make New Jersey more resilient in the face of an economic downturn, though that messaging has rarely been a part of his past pushes for a millionaires’ tax.

Murphy also left the door open to repealing cuts to the state’s sales tax that were passed towards the end of former Gov. Chris Christie’s second term.

He unsuccessfully sought to reverse those tax cuts in 2018, and he wouldn’t rule out taking another run at it in this year’s budget.

“I’m not sure, to be honest with you. We’ll come back to you,” Murphy said. “We’re putting the pieces of the budget together as we speak. That’s a five or six week window between now and then. I want to begin with doing what’s right and fair.”

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