Fight Tax Giveaways to Corporations

 

This issue is before us as a result of concerns that valuable “social safety net” programs in welfare, health, education and affordable housing may suffer funding cuts as new line items aimed at reducing taxes to corporations are promoted. Based on the history of the Christie administration’s approach to fiscal matters, if certain proposed bills are enacted into law the consequences for state funding on issues that matter to UULMNJ can be serious. In the short term Governor Christie may actually be our ally and veto such bills, but we cannot rely on that happening.

There are 2 bills in particular that concern us:
S1885/A3667  – corporation business tax for interest
S1949/A2767 – partial energy/utility sales tax exemption

Each of these has passed the NJ Senate and had a fiscal note attached. If you want to see them, please go to http://www.njleg.state.nj.us/bills/billsbynumber.asp. Each of these sounds plausible because there are potentially good causes behind them. However, each of these would in fact cause taxes to go down for the beneficiaries. That would hurt overall state revenues and state spending cuts would be inevitable in today’s environment. Each one is judged by us to be job-neutral, meaning not create any jobs. Fiscal impact on the NJ Treasury is that S1949 will cost $34.1million and S1885 is indeterminate per the fiscal notes by Office Legislative Service. Status of these bills is:

A3667 – referred to Assembly Commerce and Economic Development committee 1/6/11
A2767 – referred to Assembly Telecommunications and Utilities committee 11/10/11

Your focus needs to be on your 2 Assemblypersons since these bills have already passed the Senate. All could be approved by Assembly committees and get to a final vote lightning fast (we have seen that many times).

What the EJTF is asking you to do is:

  1. Contact your Assemblyperson with this message: Vote NO on S1885/A3667 and S1949/2767.  This can best be done by an in-person meeting (not possible for many of them since they will be back in session this week), calling their Trenton office or sending it via the NJ Legislative website (http://www.njleg.state.nj.us/members/legsearch.asp). We must reach the Assemblypersons ASAP or this effort will not be effective, as in early December Assembly legislative sessions and committee meetings are scheduled.
  2. Elaborate on the simple message above that tax incentives for corporations have unintended consequences on other programs, particularly the “social safety net.”
  3. Provide a report on outcome of any feedback from your legislator to the contacts for the subcommittee of EJTF: Arthur Perkins artperk@msn.com; lorrainewearley@gmail.com; mtpremo@gmail.com.
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