Governor Murphy suggests record editions, new taxes and fees in his final NJ budget

Governor Phil Murphy presented his final state budget proposal on Tuesday and asks the government of New Jersey to record a record of 58.1 billion US such as alcohol, cigarettes, luxury houses and internet games.

Murphy's proposal for the 2026 financial year, which begins on July 1, would spend 1.2 billion US dollars more for tax money than is expected to take. This is compared to the “structural deficit” of 2.2 billion US dollars in the “structural deficit” of 56.6 billion dollars signed last year. Sources also announced NJ Advance Media that the state was exposed to a deficit of around 3.7 billion US dollars a few weeks ago.

Since then, the leaders have been part of the gap by reducing expenses of 2 billion US dollars, including the grants of 800 million US dollars in the last minute in June and the imposition of new taxes and fees. In addition, the state enjoyed a greater increase in income tax revenue with larger than expected income, the officials said.

“Although the budget that I present to you today, it is the final budget of our administration, but it reflects our ongoing – and relentless – commitment to building a state that is more, more fairly and prepared for the future,” said Murphy on Tuesday in his budget address in the Statehouse in Trenton.

The expenditure plan contains a surplus of 6.3 billion US dollars to ensure that the next governor will inherit an heir who is more than 15 -higher than Murphy when he took office in 2018.

“With this proposal, we get the budget of New Jersey back on the way into balance so that we can keep our obligation to keep our financial house in the best possible form,” said Murphy.

However, this surplus is still not sufficient to withstand billions of dollars of proposed Medicaid cuts, based on a plan by the Republicans of the Congress, to reduce the health insurance program for the poor and the disabled. There is also deep uncertainty about other possible spending cuts by the Republican President Donald Trump's new administration.

“I think it is certainly to say that we have more uncertainty at federal level than to any other point in modern history,” said Murphy, Democrat. “And this uncertainty has a direct impact on all of us and especially the people in New Jersey.”

“And while I sincerely hope that the situation in Washington will settle and that we have a normal, healthy budget season in turn in the next few months, this is by no means a guarantee. I have every intention to work in good faith with the Trump government to improve the life of the people we serve, “added Murphy.

But he noticed: “We have to acknowledge this new reality – and adapt to it.”

The impending threat from Medicaid's cuts would be “a game changer,” said the champion of state treasures Elizabeth Muoio before the speech.

“We have to be laser -oriented in this in the coming months,” she said.

The Republicans, the minority party in state legislation, condemned the expenditure plan and said they would leave the next governor in a difficult position. There are 11 big candidates of both parties in the governor race this year to be Murphy successful.

Critics also found that the price of the plan is $ 58.1 billion by 67% greater than the last budget before Murphy took office in 2018.

“This budget is anything but affordable,” said the meeting woman of the State Assembly, Nancy Munoz, R-Union.

The new stay of NJ Property-Tax aid program for seniors is an example of Murphy say goodbye to the money, say the Republicans. Murphy's proposal and the two previous budgets would bring in 600 million US dollars. As a result, the first check round in 2026 would go to residents from 65 and older, which earn less than 500,000 US dollars a year. But the money runs in six months and obliges the next governor to find the 1.2 billion US dollars that are required for a whole year of the advantage.

Murphy and the leaders of the democratically controlled legislator will now negotiate a final budget, due on June 30th. There will be public hearings on Murphy's plans in the coming months.

Here is a look at the big points of the governor's proposal:

1.2 billion US dollars of new fees and taxes

The budget does not contain any broad tax increases, such as: B. an increase in sales tax or income tax. However, it identifies new services for taxes or increases the amount of existing taxes or fees. Here are some:

• House sales of 1 million US dollars or more: People who buy houses for 1 million to 2 million US dollars would pay an assessment of 2% compared to the existing 1%. And 3% for houses sold for more than 2 million US dollars. The state expects to collect 317 million US dollars.
• Internet games and sports betting: The players now pay a tax of 13% for profits from sports betting and 15% on the Internet. Murphy suggests increasing it to 25%. The state expects to win 402.4 million US dollars.
• Cigarettes, alcohol and vapes: A tax increase of 30 cents from 10 cents for vaping the liquid would bring in the state of $ 10 million. A tax increase of 10% for alcoholic beverages would bring in $ 18.5 million. The tax for a pack of cigarettes would increase by $ 3.00 cents and generate 10 million US dollars.
• New taxes on previously irrelevant services: The state expects to collect $ 277 million by loading go-cart races, laser tag, bowling, interior design, horse training, massage therapy, vehicle trade, some compressed meals, tickets and hotel rooms. Murphy also wants to end sales tax exemption and sales tax of 20,000 US dollars for boats. A bright spot: He wants to stop taxing the sale of baby products and sunscreens.
• Truck traffic: In warehouses, there is a fee of 2 US dollars for consumption tax of 2 US dollars, which increases an estimated 20 million US dollar and at the same time “alleviate the effects on the development of new warehouses”.

Facilitation of real estate tax

The proposal contains $ 4.3 billion for programs that offer a direct facilitation of real estate tax. There is leveling to receive the anchor program for 2 million people, the law on property tax deduction and the senior tax freeze, which benefited 235,000 inhabitants. There are also 600 million US dollars for Stay NJ, the latest program for around 432,000 seniors, which is scheduled to begin in 2026.

“As early as 2018, the average, justified homeowner in New Jersey received 246 US dollars in property tax relief. This year, this average tax relief payment of over $ 1,500 – is more than 500% in just seven years, “said Murphy.

School help

The proposal contains additional public school help of $ 436.8 million, which represents the largest payment so far in the context of the law on reforming school financing. The full tab is $ 12.1 billion for 1.4 million students.

“With this financing, we not only invest in the success of the students of our state,” said Murphy. “We also help every working parent to save more money. Because every additional dollar that the state provides for public education is a dollar that our families can save in land. “

Some school districts, especially in Republican areas, were frustrated by the loss of financing. According to Murphy, the budget will “facilitate” volatility by limiting the losses.

The proposal would also issue $ 10 million for the expansion of the pre-kindergarten programs.

Another full pension payment

For the fifth time in a row, Murphy plans to pay a complete payment of 7.2 billion US dollars in the pension fund for public workers. He found that his administration has done 47 billion US dollars of pension contributions of 47 billion US dollars -six times what other governors paid together.

NJ Transit

Thanks to the new tax on the richest companies in the state this year, 815 million US dollars for the budget for NJ Transit will be created, the state's struggled bus and rail traffic system. The supporters have asked for a special source of financing for NJ Transit for years.

Murphy has also advertised state and federal investments in capital projects.

With the help of federal aid, investments were made in capital projects, including 1,000 buses in the past seven years.

“And now with our proposed budget we will advance the complete modernization of the NJ transit by providing funds to replace every single outdated bus and train car that remains in the agency's fleet,” he said. “If you do this, NJ Transit becomes more reliable and accessible to every New Jerseyan.”

reaction

The Republicans held a press conference to refute the plan. The Senator Declan O'Scanlon, R-Monmouth, stopped the red lipstick, said Murphy had given him a comment before the speech-a comment that O'Scanlon recently said that the budget “would push lipstick on a pig “.

He is a man of good humor. He got the joke, “said O'Scanlon.” I like the governor. ”

But O'Scanlon added: “This budget is this pig. It has been designed for years to enable this administration to miss the problems on the next governor. “

The Republicans argued that Murphy had been able to support great expenses with Federal Aid of Federal Covid-19 in recent years, which has since decreased and accused him of not holding out his vow enough to reduce these expenses. They also warned that the tax increases impair the state's economy and could take money out of people's pockets.

“You can listen to this rosy picture that the governor just painted,” said the minority leader of the meeting, John Dimaio, R-Warren. “But when we dig up with what this budget will be, I say that buyers are careful.”

The President of the Senate of the Senate, Nick Scutari, D-Union, crowded against the criticism of the Republicans and said they had no specific agenda.

“Tell us what you would cut,” said Scutari.

NJ Advance Media Staff Writer Brent Johnson contributed to this report.

Clarification: Murphy has proposed higher taxes on internet game and sports betting profits. An earlier version of this story was wrongly stated that players are taxed on bets.

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Susan K. Livio Can be reached at slivio@njadvancemedia.com. Follow her on Twitter @Susanklivio.

Jelani Gibson Can be reached at jgibson@njadvancemedia.com. Follow him on X @Jelanigibson1 and further LinkedIn.