Jersey Taxes Rank State Dead Last -- Again
Posted October 2, 2009

In a story that's sounded like a broken record for years, out-of-control taxes continue to burden the people of New Jersey.

According to a Monmouth University/Gannett New Jersey Poll released this week, our state's "highest in the nation property tax burden:

• is the top reason why residents want to leave the state;
• has risen at a faster rate for middle income families than it has for either lower income or upper income homeowners…; and
• is perceived to be caused by a wide variety of factors, including waste and fraud, high public employee salaries, and the large number of local governmental entities in New Jersey."

And it doesn't end there. The poll found a full 50% of New Jerseyans want to exit the state, with 33% citing property taxes and 25% naming cost of living as the primary reasons.

When it comes to businesses, the news isn't much better. Last week, the non-partisan Tax Foundation released its 2010 State Business Tax Climate Index, which measures the "'business friendliness' of state tax systems."  Once again, New Jersey came in "dead last", repeating last year's performance. In other words, as the full index indicates, we are the state "most inhospitable to economic growth."

Consider this from the report:

Most states have at least one major tax area that is hospitable to business and economic growth, and most have at lest one punitive tax that makes the state's tax climate look comparatively bad….

On the other hand, some states do manage to achieve an almost uniformly good or poor tax climate. New Jersey has only one tax that scores dead last, property taxes, but its overall ranking is 50^th because it has no competitive taxes. The best it can muster is a middle-of-the-pack 25^th on unemployment insurance, the least heavily weighted sub-index, while scoring poorly on the three biggest state-level taxes: corporate income (10^th worst), personal income (4^th worst) and general sales (13^th worst).

From individual income taxes to property taxes to the so-called "millionaire's" tax to sales taxes to gross receipt taxes … the list of Garden State offenses seems to go on and on.

Perhaps most frustrating about this taxing state of affairs is that it doesn't have to be.

The Tax Foundation Index explains, "Every state must raise revenue, and thus every state must tax. No state, however, needs to tax in a way that has significant adverse effects on the business climate."

Meanwhile, the Monmouth poll notes, "[R]educing the property tax burden will take political courage.

Indeed, taxes are necessary, but astronomical taxes, out-of-control spending, and bureaucratic waste are not.

Will significant spending cuts be required? Yes. But as we have been saying for quite some time, if the administration would give a firm directive to all state agencies to cut spending by 10%  – across the board – the benefits would be palpable. Unfortunately, neither the administration nor the majority of our state legislators have yet displayed the courage to enact meaningful reform to lessen New Jersey's onerous tax burden.

The good news is that our elected officials are not the only catalysts for change. Every election, New Jersey voters have the opportunity to steer the direction of our government. New Jersey voters can demonstrate the courage legislators lack. It's up to us to get involved; it's up to us to speak up, and it's up to us to vote our values.

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