Republican lawmakers were quick to take credit yesterday for a projected spike in gross income tax collections, saying the increase was the result of the administration’s sound budgeting practices.
“With state finances in shambles, Republicans and Governor Christie led last year by offering a balanced, fiscally disciplined budget after the Democratic Majority abdicated their responsibility to govern,” said Sen. Tom Kean Jr. (R-Westfield). “Today’s improved revenue forecast shows that the decision to live within our means and hold the line on taxes is working.
Senate Budget Officer Sen. Anthony Bucco also weighed in, taking credit on behalf of his colleagues for their fiscal restraint.
“The positive revenue projections announced today are a vindication that the budget priorities pushed by the Governor and supported by my Republican colleagues over the past year were the correct choices,” Bucco said.
But according to Office of Legislative Services Budget Chief David Rosen, the boost over initial projections was the result of an increase in high earners in the state, mostly due to an uptick in the fortunes of Wall Street.
“The takeaway from these facts is that while the recession has had terrible consequences for many middle- and lower-income New Jersey residents, it was the loss of income for wealthier New Jerseyans that sunk our income tax collections,” Rosen told the committee. “And it is the flip side of that coin that is appearing in our revenue collections now.”
The tie-in, Republicans say, is their refusal to raise taxes and the governor’s veto of the millionaire’s tax. By refusing to reinstate the millionaire’s tax that lapsed in the final days of the Corzine Administration, the governor kept the state’s wealthiest taxpayers from heading to more hospitable tax climates.
But Rosen told the committee that he believes that a downturn in the number of wealthy filers earlier this decade was the result of a drop in income due to the recession and not an “outward migration.”