Posts Tagged ‘New Jersey taxes’

Christie fires first shot

Wednesday, December 23rd, 2009

New Jersey Governor-elect Chris Christie fired a warning shot across the bow of state government this week.  The message is refreshing and offers a glimmer of hope that the sinking ship that is New Jersey may be rescued after all.

The state’s director of the Office of Management and Budget, on behalf of Christie’s transition team, sent out a three page memo via email to all state department heads.  It warned of three upcoming scenarios: a cut to their operating budgets of either 15%, 20%, or 25% in the upcoming new year.

In a state with an anticipated $8 billion budget shortfall, those cuts in real dollars equal $3.8 billion, $5.1 billion, or $6.4 billion.  And departments can’t achieve their cuts by shifting payments on outstanding debt.  It has to be tangible cuts to services and labor force.  All this means no magic tricks, no slight of hand.  Also, cost-of-living (COL) increases will not be automatic.

Department heads have until January 6th to make their initial recommendations for budget cuts.  Meanwhile, groups who receive state funding are sweating out the results.  Everyone is going to lose something.  But it has to be that way.

Congratulations to Governor-elect Christie for not keeping the status quo.  To use a quote made famous nearly 60 years ago, “Give ‘em hell, Harry!”

- Mountain Man

New Jersey: Not Business Friendly

Thursday, December 17th, 2009

Let’s face it.  If the economy is to recover quickly, the bottom line is jobs, jobs, jobs.  Put people to work and everything else falls into place.

Businesses, of course, are the key to creating jobs.  And two-thirds of jobs are with small and medium size businesses.  So to get businesses to hire more employees, the economic climate must be favorable.

New Jersey, unfortunately, ranks last or near the bottom of every business-friendly list generated, based on several factors. New Jersey ranks well in transportation, easy accessibility to large markets, having an available labor pool, and having the third lowest gasoline tax in the nation.  That’s the end of the good news.

New Jersey has the second highest individual capital gains tax and sixth highest corporate capital gains tax.  Property taxes are amongst the highest in the United States.  Wading through the multi-levels of government and environmental bureaucracy adds to the negatives.  Why would a business relocate to New Jersey with the high cost of doing business, plus the time delays in getting construction completed due to getting bogged down in permitting?

New Jersey – and newly-elected Governor Chris Christie – need to make some changes to spur business.  Tax rates on corporations and small businesses must be reduced.  The state will make up the loss in revenue by gaining more businesses, which in the long run makes a more stable tax base.

And as we all know, real estate property taxes must drop dramatically.  With six out of every 100 workers in New Jersey actually employed by the state, it’s not hard to figure out where the first cuts should be!

- Mountain Man