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N.J. tax climate stifles business growth, says Tax Foundation

jobsbriefcase031011_optBY ADELE SAMMARCO
NEWJERSEYNEWSROOM.COM

Opening a business and planting roots in the Garden State may be a bit bleak, according to a non-partisan tax research group based in Washington, D.C.

Just one week after Governor Christie’s State of the State Address where he touted the Garden Sate as experiencing a “comeback,” a new report finds New Jersey ranks last in the entire nation for business growth.

The Tax Foundation, a non-profit tax advocacy organization that promotes simpler tax codes with lower rates, released its annual Business Tax Climate Index Wednesday, which ranks the 50 states based on how welcoming their tax law is to businesses and found New Jersey to be not so accommodating, ranking it dead last.

The Governor said the ranking doesn’t account for his proposed across-the-board 10 percent income-tax cut or earlier initiatives to slash business taxes by $200 million and cap property-tax growth at 2 percent a year.

“When that income-tax cut comes in, I’m willing to bet you that we won’t be 50th again next time,” Christie told reporters Thursday in Trenton.

The state’s Democratic lawmakers’, who control both houses of the Legislature, say Christie’s tax cut would only favor and benefit the wealthy.

Christie down-played the report’s findings saying, “What it shows is that folks who try to say on the Democratic side that the tax situation in New Jersey is just fine are dead wrong,” the Governor went on to say, “And that’s why I want to make these changes.”

Christie and Democratic lawmakers have won praise from business groups throughout the state for working together to re-vamp taxes by reducing the minimum tax on S corporations, phasing-out an energy tax and extending the time companies can deduct net operating losses, savings companies millions, according to the Asbury Park Press.

Pressing his tax cut proposal further according to Bloomberg, Christie said, “This report is even more proof that we need to institute the income tax cut; that we need to institute the rest of the business-tax cuts that I laid out last year; and that we have to continue through shared services and other efforts to make sure our property taxes continue to move down.”

David Brogan, first vice president of economic development and taxation for the New Jersey Business and Industry Association, a business lobby group, believes, “We’re moving in the right direction, even though the report doesn't reflect that.” , according to the Press.



 

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