Budget negotiations between the governor and the Legislature broke down Friday afternoon, making it unlikely that the state budget impasse will be resolved before the July 1 deadline.
Despite a full day of negotiations, Gov. Phil Murphy, Senate President Stephen Sweeney and Assembly Speaker Craig Coughlin were unable to come to an agreement over which taxes to raise. The two sides largely agree on the spending plan, just not how to pay for it.
NJBIA President and CEO Michele N. Siekerka said it was disappointing that the two sides are only considering tax increases.
“NJBIA is extremely disappointed to learn that the budget negotiations that broke down today between the governor and the legislative leaders apparently centered on what taxes to increase, instead of what spending to cut. We need to fix the State’s structural budget deficits, such as our public pension, health benefits and education costs, rather than attempt to tax out way of our challenges.
“Proposals such as a millionaires tax and CBT surcharge try to balance the budget on the backs of job-creators. Corporations have 50 states to choose from. We need to make New Jersey more attractive to retain our businesses and capture the investment of new ones so we can gain in our regional competitiveness. Having the highest corporate business tax in the nation, in addition to the already high costs of doing business in New Jersey, will not put us on that path.”
At this point, Governor Murphy essentially has four options.
- He can conditionally veto the bills and send them back to the Legislature with the changes he wants.
- He can issue an absolute veto, rejecting them entirely.
- He can do nothing and continue to negotiate as the government shutdown approaches.
- He can line-item veto the budget so that it is balanced without tax increases and then sign it, avoiding a government shutdown but giving up some spending priorities in the process.
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