TRENTON – Democratic leaders in the Legislature today countered Gov. Christie’s income tax cut proposal with their own property tax relief proposal.
Assembly Speaker Sheila Oliver said in a release that the Democrats’ plan would be a maximum credit of $2,000, with an average family receiving a credit of $1,552.
“This is geared directly toward helping New Jersey’s middle-class and lower-income families who have shouldered a heavy burden the last two years,” she said.
The plan would provide a property tax relief credit – through the gross income tax return – for all residential homeowners with incomes up to $250,000 in the amount of 20 percent of the first $10,000 in property taxes paid.
A family earning $100,000 that pays $8,000 in property taxes would get $1,600 under the Assembly Democratic plan, compared to $275 under the governor’s plan, according to Assembly Democrats.
The plan would be phased-in over four years, with the first year providing a credit of 20 percent of the first $5,000 in property taxes paid.
Senate President Steve Sweeney also was set to discuss the tax relief credit plan today.
The governor’s income tax cut would be an across-the-board 10 percent cut that would be phased in over three years, which Democrats have said unfairly benefits the wealthier residents.
“The evidence is clear that Gov. Christie’s proposed income tax scheme would benefit the rich far more than New Jersey’s middle-class, but our plan steers us back in the right direction and provides help against the tax that burdens working families the most,” said Assembly Majority Leader Lou Greenwald in a release.
Under the Democrats’ plan, there would be no change to the property tax rebate/credit program, but homeowners qualifying for the property tax relief credit would receive the larger of the two.
The Senior Freeze property tax relief program would remain in place.
Also, according to the Assembly Democrats, the minimum credit under the property tax deduction for those not qualifying for the new credit would triple from $50 to $150. This would primarily benefit tenants. Tenants would also continue to remain eligible to receive the property tax rebate/credit in any year it would be funded.
Underscoring that their plan excludes the truly wealthy residents, those with incomes between $250,000 and $1 million would see no change and would remain eligible for the existing property tax deduction.
In fact, under the Democrats’ plan, the state’s income tax rate for those earning more than $1 million would be increased beginning next fiscal year. The rate would go from 8.97 percent to 10.75 percent. This would affect about 16,000 residents, they said, and raise about $800 million in fiscal year 2016.