NJ Politics Digest: If Murphy Wants Intraparty Fight On Taxes, Dems Say ‘Bring It On’

Phil Murphy.

Phil Murphy. Kevin B. Sanders for Observer

State budget season is rapidly approaching, and divisions in the state Democratic party might soon get ugly.

Gov. Phil Murphy has yet to convince Democrats in the legislature to fully embrace his new $37.4 billion budget or to go along with the $1.7 billion in new taxes needed to pay for it.

Now, New Direction New Jersey, a nonprofit formed by supporters of Murphy, is threatening to take to the airwaves to pressure holdouts to get onboard with Murphy’s call to increase the state income tax, impose a new tax on millionaires and on internet purchases, e-cigarettes, ride sharing services such as Uber and Lyft and marijuana (if the legislature follows Murphy’s call to legalize it).

But Democratic Senate President Steve Sweeney and Assembly Speaker Craig J. Coughlin don’t seem perturbed.

“Bring it on,” Sweeney said in an interview with The Record.

Such a fight could be a defining one for Murphy and could set the tone for the remainder of his term.

While polls show 44 percent of voters approve of Murphy, they also show that residents are largely unfamiliar with his budget plans.

A war in the media could establish a vision of Murphy—who had campaigned on promises to help New Jersey’s struggling middle class—as the guy who is fighting to raise taxes in a state that is seeing record numbers of people fleeing it because of the crushing tax burden.

Murphy contends people will be willing to pay even more, if they feel they are getting their money’s worth from state services.

While seeming to embrace Murphy’s call for expanding services and increasing payments into the state’s pension system, Sweeney maintains that tax increases are “a last resort.”

He’s also still opposed to a millionaires tax, instead offering a plan to increase taxes on corporations that earn more than $1 million in annual net income in the state. These corporations benefited from the Republican federal tax overhaul, Sweeney maintains. Also, many of them are not based in New Jersey, a much more politically palateable plan than increasing taxes on residents, no matter how wealthy they are.

Sweeney says the federal changes, which did away with deductions for state and local taxes, means it’s not the right time to impose even more taxes on high earners, who would likely flee the state—thereby increasing the tax burden on middle-income people.

Quote of the Day: “If you want to fight publicly over raising taxes or trying to protect people in the state of New Jersey from taxes going up, let’s have the fight.” — New Jersey Senate President Steve Sweeney, on the prospect that Gov. Phil Murphy’s allies are planning a media campaign attacking Democratic legislators for not supporting Murphy’s plan to raise the sales tax and a variety of other taxes to fund his budget.

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NJ Politics Digest: If Murphy Wants Intraparty Fight On Taxes, Dems Say ‘Bring It On’