Senate passes millionaire’s tax in late night committee

TRENTON – Following a long day of legislating, the Senate Budget and Appropriations Committee approved the bill reinstating the millionaire’s tax, although now the surtax will be levied on actual millionaires.

“I think everybody in the state of New Jersey has heard the governor say over and over that he won’t sign it,” said state Sen. Tony Bucco (R-25). “Why are we passing it?”

Speaking for sponsor state Sen. Ray Lesniak (D-20), Chairman Paul Sarlo (D-36) said it’s a shared sacrifice that top-earners should contribute to – and it’s tied to school funding distribution changes. If lawmakers are voting against the tax, they should also be voting against the school funding bill, Sarlo said, “bringing all of the school districts in New Jersey up to full funding.”

There’s a poison pill clause in the millionaire’s tax that requires the governor to sign the tax before the school funding bill. The millionaire’s tax bill also includes a provision dedicating $62 million from the revenue to go toward income tax relief for seniors and pensioneers. “This is really tie-barred to two very worthy (measures),” Sarlo said.

“A political exercise,” state Sen. Joe Pennacchio (R-26) said of the measure, heading straight for a veto. Nonetheless, the committee approved the bill on party lines, 8-5, with Republican Senators opposing the measures.

Salro said the tax will raise $676 million in revenue, of which $458 million is dedicated to school funding and $62 million of which is dedicated to income tax relief. The remaining $156 million raised will be put toward state surplus, Sarlo said.

The committee also approved supplemental appropriations for FY11, the fiscal year coming to a close this week. It also passed, 8-5.

Senate passes millionaire’s tax in late night committee