The International Brotherhood of Electrical Workers announced its opposition to a bill that would create tax on financial transactions in a letter to the measure’s sponsor Monday.
“I can certainly respect your position and understand the reasoning behind the legislation. With that being said, it will certainly come with major consequences to our organization,” IBEW Construction Division political director Ian Leonard said in a missive to Assemblyman John McKeon (D-West Orange).
McKeon’s proposal, which has not been finalized, would impose a quarter-of-a-cent tax on trades made by firms processing more than 10,000 transactions in a given calendar year using infrastructure in New Jersey.
The union official said the tax could push major employers out of the state, potentially costing IBEW locals in North Jersey a quarter of their annual work load.
“The financial institutions that this tax would impact are employers to our locals that provide the following at a minimum to our organization each year: over 2.5 million man hours, millions of dollars in payroll and taxes and, most importantly, the work provided by these institutions represents 25% of our work on a yearly basis for our three North Jersey Locals,” Leonard said.
The New York Stock Exchange and NASDAQ Inc. have threatened to pull out of the state if the tax is passed. The NYSE has conducted a simulated trading day in Chicago, where it has said it may move if the tax is enacted. NASDAQ is in talks with Texas about a possible relocation.
The Assembly Financial Institutions and Insurance Committee, which McKeon chairs, is set to hold a hearing on the measure Monday, though it does not plan to vote on the bill then.
The IBEW’s figures represent the first public measure of potential job losses the exchanges’ emigrations may cause. It’s also the first union to wade into the fight over the microcent tax.
So far, the exchanges and various business advocacy groups, including the New Jersey and U.S. Chambers of Commerce and the New Jersey Business and Industry Association, have lobbied state and federal lawmakers against the tax to little avail.
Though they were initially hesitant to back the measure, Murphy and Democratic leaders in the legislature have increasingly regarded it as a solution to the state’s virus-induced fiscal woes.
The proposal is still far from final, and there’s been little clarity about how much revenue the tax would bring to the Garden State or how many jobs the exchanges would take with them if they pulled out of New Jersey.
Now, the governor is marketing the tax as a temporary measure.
“The spirit that we’ve tried to express is this is not forever and for always,” he said at an unrelated event Tuesday. “This is an hour of need where we have to come together, and if we do that, we’ll get through this together.”
But that hasn’t been enough to assuage fears among the IBEW.
“The last thing we want to see is more of our members filing for long term unemployment and the potential of some of our long-term employers gone for good due to another tax from the State of New Jersey,” Leonard said.