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Gov. Phil Murphy. Photo by Kevin Sanders for the New Jersey Globe.

Murphy reissues call for tax incentive reform following NY Times report

Newspaper’s investigation found 12 firms got tax breaks after threatening to move to the same New York Office Park

By Nikita Biryukov, September 24 2019 2:58 pm

Gov. Phil Murphy reiterated his criticisms of the state’s tax incentives programs after The New York Times reported that at least 12 firms threatened to move to an office park in New York without ever seriously considering relocating to the Empire State.

“Today’s New York Times story is yet another illustration of what I have been saying for nearly three years – the tax incentive programs created by the Economic Opportunity Act were severely flawed and not only did not create promised jobs, but invited potential fraud and malfeasance,” Murphy said. “It is time to put this broken system — a system that has become a national embarrassment — behind us and create a new, targeted, and transparent suite of incentives that focuses on nurturing innovation and bringing new business and new jobs to New Jersey.”

Tax incentive programs administered by the Economic Development Authority lie at the center of an intra-party feud between Murphy and Senate President Steve Sweeney.

Murphy, who was largely an outsider to New Jersey politics before winning the state’s governorship in 2017, has repeatedly called for reforms to the programs.

Sweeney, with South Jersey power broker George Norcross at his back, has repeatedly defended the programs, saying the governor was unfairly singling out businesses, some with ties to Norcross, in Southern New Jersey, though the task force convened by Murphy to investigate abuses of the EDA’s tax breaks have previously pointed to abuses by at least one North Jersey firm.

The Times’ report showed that firms north of Trenton engaged in similar practices.

Jaguar Land Rover North America, headquartered in Mahwah, and FC USA, a travel company based in Ramsey, allegedly made false threats to move to New York in exchange for tax incentives, according to the Times report.

“We can no longer commit taxpayer money to dubious job-retention programs that have proven ineffective at best,” Murphy said. “The tax incentive reforms we have put forth to the Legislature not only accomplish our job creation and economic growth goals, but also cap yearly incentives at a predictable and sustainable level.”

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