Americans for Tax Reform applauds New Jersey Governor Chris Christie for yesterday’s swift veto of legislative Democrats’ “millionaires” tax. The bill would have increased the income tax on high earners from 8.9 percent to a punitive 10.8 percent.
The tax increase, which Gov. Christie vetoed less than two minutes after its passage, is another result of the legislature’s tired refrain that revenue, rather than spending, is the problem in the Garden State. In reality, inflation-adjusted state spending increased nearly one-third between 1997 and 2007. Government frivolity in times of economic expansion has given way to a $10 billion shortfall that the state has repeatedly failed to bridge with higher taxes. The proposed $1 billion tax increase would have been an extension of the Jon Corzine big government legacy.
“It was refreshing to see Gov. Christie veto this measure as swiftly and reflexively as Democrats look to higher taxes to solve all their problems,” said Grover Norquist, President of Americans for Tax Reform, “The governor understands the need for New Jersey to shed its image of fiscal incompetence and embrace pro-growth economic policies.”
In 2004, New Jersey increased in the top income tax rate, which applied to those earning over $500,000 per year. Between 2004 and 2008, the state saw a net decline in household wealth of $70 billion. Further raising taxes on high earners – and small businesses – would do little to reverse the outward migration New Jersey has seen over the past ten years.
“Between 1999 and 2008, New Jersey lost nearly 419,000 residents to other states,”added Norquist. “In a state hemorrhaging population to low-tax, pro-job jurisdictions, the legislature’s decision to further raise taxes is ludicrous. I commend Gov. Christie for promptly vetoing this job-killing tax increase and remaining committed to real, sustainable reforms in the Garden State.”