Bill Text: NJ AR302 | 2016-2017 | Regular Session | Introduced
Bill Title: Opposes recent federal tax reform proposals that disproportionately impact New Jersey residents.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2017-12-14 - Introduced, Referred to Assembly Budget Committee [AR302 Detail]
Download: New_Jersey-2016-AR302-Introduced.html
Sponsored by:
Assemblywoman VALERIE VAINIERI HUTTLE
District 37 (Bergen)
SYNOPSIS
Opposes recent federal tax reform proposals that disproportionately impact New Jersey residents.
CURRENT VERSION OF TEXT
As introduced.
An Assembly Resolution opposing recent federal tax reform proposals that disproportionately impact New Jersey residents.
Whereas, On November 16, 2017, the United States House of Representatives passed the Tax Cuts and Jobs Act, which revises the federal individual and corporate tax frameworks, only two weeks after the 440 page bill was introduced; and
Whereas, On November 29, 2017, the United States Senate's version of the Tax Cuts and Jobs Act advanced past a key procedural step, setting the bill up for a Senate floor vote; and
Whereas, These two versions of the Tax Cuts and Jobs Act are not identical but are grounded in the same policies and employ many of the same measures to achieve a common goal: to cut taxes and reduce business tax rates in order make American companies more competitive, with the hope that job creation and wage growth will follow; and
Whereas, Economists across the political spectrum and nonpartisan tax policy public interest organizations have concluded that, absent significant changes, the enacted proposals will end up tearing a $1 trillion to $1.5 trillion hole in the federal budget deficit while ultimately increasing the tax burdens of hardworking middle class taxpayers, a disproportionate number of whom reside in New Jersey; and
Whereas, The Institute on Taxation and Economic Policy concludes that over a quarter of New Jersey residents will end up paying increased taxes under the proposals--taxpayers who already send billions of dollars more to Washington, D.C. each year than is returned in services from the federal government--presaging the millions of middle class taxpayers in this State who will be hit with a tax hike once certain benefits sunset in 2027, according to the congressional Joint Committee on Taxation; and
Whereas, To compensate for slashing tax rates on corporations and high-income individuals, a central component of the proposals is the elimination or capping of the deduction for state and local property, income, and sales taxes, which are critical deductions relied upon by middle class New Jersey taxpayers in particular; and
Whereas, According to federal Internal Revenue Service statistics for Tax Year 2015, 40 percent of New Jersey taxpayers claim either the income or sales tax deduction, which in 2015 resulted in approximately 1.8 million New Jersey taxpayers deducting a combined $17 billion in state and local taxes from their federal taxable income, while over 1.5 million New Jersey homeowners deducted nearly $15 billion in property taxes during that same period; and
Whereas, Ending the state and local tax deduction is particularly harmful to New Jersey middle class taxpayers, as approximately 83 percent of New Jersey taxpayers who claim the state and local tax deduction earn under $200,000 annually and half earn less than $100,000 annually; and
Whereas, The proposals also restrict the ability of New Jersey taxpayers to deduct the amount of home mortgage interest paid from their federal tax obligation, which, along with cutting the property tax deduction, will diminish a tax incentive that enables families to purchase new homes and encourages homeowners to renovate existing homes, consequently harming New Jersey's residential construction industry that employs thousands and is still struggling to recover after the financial crisis of 2007-2008; and
Whereas, To pay for tax cuts for the highest-earning Americans and large corporations, the proposals consider eliminating deductions for student loan interest, ending deductions for tuition waivers for graduate students, and increasing taxes on college and university endowments, the proceeds of which are used in part to subsidize tuition and expenses for students from lower-income backgrounds; and
Whereas, The proposals' measures affecting education do not stop at students; the proposals may eliminate deductions that compensate teachers and other professionals who reach into their own pockets to purchase supplies for their classrooms and workspaces; and
Whereas, Approximately 900,000 New Jersey residents gained access to health care under the Affordable Care Act, and an equally staggering number of taxpayers may be placed at risk of losing their insurance if a Senate measure is adopted that eliminates the individual mandate requirement, in turn spiking insurance premium rates for millions of other State residents by as much as 10 percent, according to the Congressional Budget Office; and
Whereas, The Tax Policy Center anticipates that an ancillary result of the tax redistribution measures of these policies--primarily changes to the charitable deduction--will result in a reduction in charitable contributions by $12 billion to $20 billion in 2018 alone; now, therefore,
Be It Resolved by the General Assembly of the State of New Jersey:
1. This House opposes Congress's recent tax reform proposals, the Tax Cuts and Jobs Act, that disproportionately harm New Jersey and its residents.
2. This House respectfully urges Congress to instead fully deliberate and pass common sense tax reform that is focused on providing equitable and meaningful tax relief to all New Jersey taxpayers.
3. Copies of this resolution, as filed with the Secretary of State, shall be transmitted by the Clerk of the General Assembly to the President and Vice President of the United States, the Majority and Minority Leaders of the United States Senate, the Speaker and Minority Leader of the United States House of Representatives, and each member of Congress elected from this State.
STATEMENT
This Assembly resolution expresses opposition to the tax reform bill pending in the United States Senate and the tax reform bill that was recently passed in the United States House of Representatives, on the basis that these proposals eliminate critical deductions that are relied upon by middle class taxpayers and balance tax cuts in a manner that disproportionately and negatively impacts millions of New Jersey taxpayers.
