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Let The Exodus Begin: New Jersey Raises Tax On Millionaires

Tyler Durden
September 18th, 2020
ZeroHedge
Comments (8)

This article was originally published by Tyler Durden at ZeroHedge. 

In the latest suicidal move by New Jersey, the state which after Illinois is in the direst of financial straits and has the second-lowest credit rating in the nation…

… On Thursday morning, Jersey Governor Phil Murphy and Democratic leaders agreed on a budget deal that will raise taxes on millionaires, sparking another exodus from a state which has already seen many of its richest residents – such as David Tepper – depart for more hospitable states.

As the NYT gloats, “Gov. Philip D. Murphy campaigned on a vow to raise taxes on the rich in New Jersey. It took three years and a pandemic to get it done.” Clearly the NYT has any idea just how worse off the state will be in a few years as a result of sliding real estate prices and broadly lower tax revenues.

Murphy, a former Goldman Sachs executive and fervent Democrat who took over as NJ governor from Chris Christie in 2018 was expected to announce on Thursday morning a deal that includes a higher tax rate for residents earning more than $1 million a year. In keeping with Murphy’s social justice warrior ambitions, the agreement also includes a $500 rebate for families with at least one child and an annual income of less than $150,000 a year for couples and $75,000 for single parents. The new tax is expected to generate an estimated $390 million this fiscal year, while the $500 rebate is expected to cost about $340 million a year.

“Blink and you’ll miss the next Trenton tax hike,” the state’s Republican chairman, Doug Steinhardt, said in a statement. “That’s how fast Phil Murphy and his Democrats are spending your money.”

New Jersey must have a budget in place for the Oct. 1 start of the revised fiscal year, a nine-month cycle. The current fiscal year was lengthened by three months amid uncertain revenue during the novel coronavirus pandemic. The new spending plan includes $4 billion in borrowing to plug a revenue gap.

* * *

New Jersey’s move is an early glimpse of what will happen to tax rates across the country should Joe Biden become president: as part of his platform, the former Vice President has proposed raising taxes on people earning more than $400,000 to finance a slate of programs.

In the Garden State, the so-called millionaire’s tax was an initiative the Democrat-led Legislature had symbolically approved for years before Mr. Murphy took office in 2018, knowing that it would never be signed into law by the former Republican governor, Chris Christie. But Murphy, a self-avowed progressive who arrived in Trenton with few legislative allies, had been unable to win support for the idea from the Senate president, Stephen M. Sweeney, a political rival, or the Assembly leader, Craig J. Coughlin.

Until now.

Facing a fiscal crisis brought on by the urgent health needs of the pandemic and the months-long shutdown of businesses, lawmakers agreed to raise the tax rate on earnings over $1 million to 10.75 percent, up from 8.97 percent. Individuals earning more than $5 million were already taxed at the higher rate.

As the NYT notes, the deal underscores the “shifting political climate and a recognition that the wealthy may need to contribute more to the state’s recovery with so many residents out of work and struggling to feed their families.” And now the wealthy – who are no longer bound to a local office thanks to a Work From Home world – will show Murphy just how easy it is for them to uproot and leave to states with low, or no, state income tax.

In neighboring New York, Democratic Gov. Andrew M. Cuomo has largely resisted proposals to raise billions by taxing the wealthy, instead consistently calling on the federal government to bail out the state, which he is says needs some $59 billion to cover two years of projected state deficits. It’s a battle he will likely lose. Meanwhile, progressives in Albany have been pushing the governor to consider a variety of bills, including one to raise the tax rate on those earning more than $100 million to almost 12 percent.

The millionaire’s tax is part of a nine-month, $32.4 billion spending plan that must be adopted by Oct. 1. The proposed budget Murphy released last month also includes about $1.2 billion in spending cuts and $4 billion in new bonding debt.

And now the question is when New Jersey will complete its ritual suicide, hiking taxes on HFTs and frequent fire stock transactions, a move which will not only not boost revenues but lead to the prompt departure of such wealthy residents as the New York Stock Exchange (located, ironically enough, in NJ) and the Nasdaq.

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Author: Tyler Durden
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Date: September 18th, 2020
Website: https://www.zerohedge.com

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8 Comments...

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  1. Andrea.Iravani. says:

    The Judge presiding over Assange’s case has extremely significamt conflicts of interest and should be prohibited from presiding over the case. She is involved in the intelligence community think tank, Henry Jackson Society and also has ties to French defense contractors which would have been significantly harmed from Wikileaks reporting on Qadafi’s overthrow with the motive of abandoning the Franc and creating a gold based Trans African Dinar with leaks between Sidney Blumenthal and Hillary Clinton as Sectretary of State.

    The U.N. has also expressed concern over Assange’s heath. This judge is evil and really has it in for Assange on a personal level, which she demonstrated by refusing to release Assange after Sweden dropped charges. She is a pariah and a piranha.

    She also said that Assange is casting doubt on the Western regimes moral intemtions. Hey, there is no doubt! You are evil! It is not a conspiracy theory! It is an evil conspiracy! Not exactly a secret either! The wars on multiple fronts for my entire life was just one of the clues that some people picked up on that you are as evil as hell! You prove it everyday!

    https://www.globalresearch.ca/who-behind-judge-trying-julian-assange/5724227

    Andrea Iravani

  2. Andrea.Iravani. says:

    What’s up with Wyoming and DC? Off the chart! Not sure what the grey color code is since it is not in the key.

    Andrea Iravani

  3. Andrea.Iravani. says:

    Personally, I believe that the stock market should be abolished. The stock market destroys corporations and the economy. The stock market is where all companies go to die, and where fraudulent start-ups list IPOs. The stock market should not be bailed out. To assert that people did not know the risks is absolute bull shit! They knew exactly what the risks were, but they were greedy and followed the crowd, rationalizing their behavior that everyone else does it, and we have had three bailouts this century from it, plus over $21 trillion misding from the Pentagon because of it. The stock market is undeniably a crime ring. These investors do nothing at all to earn that, and destroy jobs because they continuously demand a race to the bottom in wages and working conditions, in addition to companies that have left America. Getting rid of the stock market would probably be the best thing that could ever happen to the country, economy, and employees. If there wasn’t a stock market, white collar crime would be much lower, because it is so easy to engage in white collar crime in the stock market. It also sends a very large percentage of money overseas, and does not help America at all. In fact, most of it goes to China because that is where most of the companies are. If Trump really wanted to crack down on China, he should crack down on not only Wall Street, but on the entire stock market. We would not have had the 9/11 controlled demolition, TARP, QE, covid, lockdowns, $21 trillion in Pentagon accounting errors, Department of Homeland Security, Patriot Act, othher Orwellian surveillance laws, the TSA,  yadayadayada. The stock market is the biggest gang of thieves that the world has ever known. 

    If you are worried about income inequality, where would the billionires be without the stock market? A lot poorer that they are for sure! Warren Buffet could not be wealthy if it wasn’t for all of the people that joined in making him extremely rich. And we cannot say that Warren Buffet has helped the average American at all, in fact, if it wasn’t for the average Americans constantly bailing Warren Buffet out, he probably would have been where he belongs a long time ago, sharing a cell with now deceased Bernie Madoff!

    This is what the stock market causes: cutting corners in things like planes, cars, electronics, appliances, and everything that is bought and sold that places profits over life 100% of the time. These high rolling gamblers should not be rewarded! 

    https://sputniknews.com/military/202009181080508426-us-navy-announces-multi-year-recovery-plan-as-embattled-fleet-short-nearly-100-fighter-pilots-/

    Andrea Iravani

  4. cranerigger says:

    Total DEMONRAT governance of New Jersey makes another stupid decision. Instead of learning from fellow DEMONRAT mistakes in neighboring New York, the idiots in New Jersey have decided to ruin there state also.

    The wannabe bullys, the TEMPER TANTRUM CROWD [snowflake ANTIFA & Black Lives (only) Matter], that represent the DEMONRAT party do not learn. Society must NOT concede our right to exist to the scofflaws that THREATEN insurrection if they do NOT get their way. If they canNOT successfully compete for votes, they need to yield to the lawful majority in our elections. Lawful nomination & confirmation regarding SCOTUS should NOT YIELD to the TEMPER TANTRUM CROWD. Yielding to bullys results in more bad behavior.

  5. Andrea.Iravani. says:

    I am disinclined to be so optimistic, having witnessed all that I have witnessed, attempting to show people from various cults the truth regarding things, and the resistance and demonization that I have encountered, including cult tactics including surveillance, gas-lighting, and stalking, and Saul Alinsky’s 13 Rules for Radicals tactics being used against me. Cults were a bad idea, in hind sight, but America is made up of cults which is what defines culture, cult being the root word. I am not talking about Moonies, or Jahova’s Witnesses, or Scientologists, or Mormans, I am talking about the RNC, DNC, and AA. Even in my own neighborhood, there is a really weird surveillance cult that moved in and took over this neighborhood and terrorizes me and gas-lights, spies on me, and breaks in, steals, and vandalizes. 

    This society is sick and as evil as hell and is 100 times more evil than Nazi Germany. I refuse to be a part of it. Much like the transition that occured during the Nazi Occupation with the total deterioration of society and a mad rush to join in and land a status position in the Third Reich or be totally rejected, demonized, and ostracized for refusing to buy into the Goebels propaganda, the Mengela Eugenics, and sadistic pointless medical experimentaion and the fury of the fuhrer Hitler.

    Those who rushed in felt a place of belonging and a common goal, never daring to say stop in fear of winding up hated and marginalized, but it is better to be hated and marginalized than respected by evil people with an evil agenda.

    So, I have no choice in my opinion but to refuse to interact with them. They literally can’t handle the truth. I happen to be speaking about many individuals that have Masters degrees, PhDs. and MDs, so it cannot be claimed tbat they simply lack the mental fortitude to comprehend such things, and in the case of AA it is deeply rooted philisophical disagreement since I do not believe in determinism aka predestination as they do. The superiority complexes of those in these cults has resulted in a disgusting and alarming sense of entitlement to not only bullshit their way through life, but to violate my rights and property as well. They are psychopaths. 

    So this is now life in America, as it was in Nazi Germany. If it is join or die, I choose death because I could not tolerate being a part of it on moral grounds.

    Andrea Iravani

  6. TharSheBlows says:

    Illinois and New Jersey are 2 of the most corrupt States in the County. Add New York and California in the mix and wonder why they are all bankrupt States? Like 4 of the last 5 Illinois Governors went to prison. Do not live in a Corrupt State, you will pay and pay and pay in this collapse. Who wants to buy a house in a heavily bankrupt State, where the housing is buried with massive property taxes, all designed to cover up the political criminals behavior looting the States treasury. Get out, lights out.

  7. Rock Roller says:

    So when will we be expecting you, Snookie?

  8. Frank Thoughts says:

    We are seeing the entrenchment of a population, mostly not white, who are becoming very used to living on government payments but not on how to create wealth and productivity (the basis of America’s wealth). Look at the numbers and you see government dependence running in parallel with the increasing de-whitening of America and decrease in living standards: in short, the descent into becoming a third world country with all the complexions of the third world to go along with it.

    BLM is nothing more than a violent extortion racket looking to get as much money as possible for blacks in this ongoing decline in living standards and civility. Where this will encounter serious push back is from those who really pay the bills: the Asians and remaining white wealth. What will happen is technology will be used to create a fully bifurcated society where the non-whites will be given what seems like a free income but in fact, because of inflation and declining productivity and resources, will be a third world poverty bare existence income. Real wealth will sit where it always does at the top and in Asia.

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