Could New Jersey shut down over millionaires tax? Maybe.

David Madden
May 26, 2019 - 4:00 am
Governor Murphy holds a press conference with advocates, community and faith leaders on impact of marijuana legalization and expungement legislation in Trenton.

Edwin J. Torres/NJ Governor's Office via Flickr

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MOUNT LAUREL, NJ (KYW Newsradio) — This time next month, New Jersey will be in the middle of its annual budget crunch, with just days to go to adopt a new one or perhaps see most state government operations grind to a halt. 

What could be the make-or-break issue?  It may well come down to money. Again.

Specifically, the millionaires tax. 

Gov. Phil Murphy last year had to settle for higher levies for those earning over $5 million a year. He is, again, insisting any millionaire in the state pay the higher rate.

“I’m not managing the state from May to June or the typical stumbling to June 30 and barely get over the goal line just so we can do it again next year,” the governor said at an event in Mount Laurel, Burlington County. “We’ve got to get to a higher and better place in this state.”

Legislative leaders, Senate President Steve Sweeney in particular, have made it clear they won’t raise taxes on anyone. Then again, Sweeney and Murphy have been at odds on a lot lately.

For example, there’s now a lawsuit from party power broker and Sweeney ally George Norcross to Murphy over the dispute dealing with EDA grants for Camden. Both sides now have high priced, highly effective lawyers. But that’s almost inside baseball compared to the millionaire’s tax debate.

Why is that?

Well, consider Murphy’s response to one reporter’s question on whether that tax could be the governor’s “line in the sand” and lead, perhaps, to a shutdown of state government if there’s a budget impasse.

“The line in the sand is, without question, enough of the old stumbling ways of putting band aids on our fiscal house,” the governor responded. “So there is a line in the sand for that.”

New Jersey came within hours of a shutdown last year over the issue, until Murphy backed down.

This year, the governor is featured in a million dollar cable TV ad campaign in favor of the levy. The campaign is funded by New Direction New Jersey, a non-profit political group lobbying on behalf of the Murphy agenda in general, and the millionaires tax in particular.