The New Jersey Chamber of Commerce and the New Jersey Business and Industry Association hosted an event on March 9 where New Jersey’s acting State Treasurer Ford M. Scudder shared his remarks about the economic issues affecting the state, including the estate tax, inheritance tax, public pensions and other issues stunting economic growth.
Scudder says the administration created the 2017 Fiscal Year budget to be business positive and resident friendly.
On Taxes, Outmigration and the State's Economy
Scudder argued that taxes are what people should pay to earn the right to live where they are. Taxes shouldn't be designed to penalize behavior.
The acting treasurer acknowledged that New Jersey's high tax rates are damaging the state's economy. They drive people, capital and businesses out of NJ, creating an economic drain on the state. Scudder said, "You can't tax a state into prosperity."
He notes there has been a 9.4 percent population increase in the 22 states that don't have death taxes. Baby boomers are moving out of New Jersey to dodge the state’s exorbitant taxes.
In 2015, the NJCPA conducted a survey of CPA leaders throughout the state. Respondents recognized that outmigration is stifling economic growth in the state. Survey results also revealed that 74 percent of CPAs in New Jersey have advised clients to consider relocating out of the state due to New Jersey's estate and inheritance taxes.
When businesses and residents move out of the state, they are taking their money and resources with them, ultimately creating an economic deficit in New Jersey. And Scudder thinks that making our residents pay more taxes to address this deficit won't work either. New Jersey needs to work hard to make sure residents and businesses can stay in the state.
Scudder advised that the state should lower taxes to allow residents to operate their businesses, invest in New Jersey's economic growth, and enjoy living in the Garden State.
Call to Action
The acting treasurer encourages New Jersey businesses to advocate for themselves by speaking to their local representatives to remove the estate tax, address public sector pension benefits and consider other tax-related issues that can negatively affect businesses. Scudder urged local businesses to tell their elected officials the impact their legislative decisions have on their wellbeing.
The business community is working hard to carry the weight of business reform, which is why NJCPA is part of OpportunityNJ, a social welfare organization created to promote the common good and general welfare of the people of NJ through strengthening the civic engagement of the state’s residents and businesses. The three main issues this organization is currently working on for New Jersey businesses are:
- Opposing mandatory paid sick leave
- Opposing the proposed minimum wage increase of $15
- Opposing the constitutional amendment requiring public pension payments
Stay up to date on these issues and more by visiting njcpa.org/advocacy and reading NJCPA Pulse.