In a glass half-full speech, Gov. Phil Murphy promised a crowd of business leaders on Tuesday that he will not succumb to political pressure and renew the corporate business tax surcharge of 2.5%. But he in the same talk before a business summit in Iselin, Murphy also emphasized that the state is looking at a budget cliff.
“A deal’s a deal,” Murphy said of his promise to let the surcharge expire. “So we said, this was a bridge till we get to a better place, and we’ve done it.”
“On the other hand, it does exacerbate a structural deficit we’re running at the moment,” he added. “And we have to be clear-eyed about that as well.”
Michele Siekerka, president and CEO of the New Jersey Business & Industry Association, which sponsored this policy forum, noted: “The sunset of the surcharge on the corporate business tax — that 2.5% — makes a difference for New Jersey corporations and the hundreds of thousands of jobs employed here in the state of New Jersey.”
The NJBIA’s latest annual survey showed 69% of employers rated the state economy as fair or poor. That’s an improvement over last year, when 78% gave the negative rating. Also, 68% of polled employers said the state hadn’t done enough to address business affordability in 2023, compared to 75% saying the same last year.
“This is a slow climb out of what some feel was a tough, after-Covid hole to be climbing out of,” Siekerka said.
As for the structural deficit, a panel of lawmakers talked about the $1 billion fiscal hole confronting NJ Transit in 2026. “We need to find some type of dedicated revenue source in the budget,” said state Sen. Paul Sarlo (D-Bergen), chair of the Senate budget committee.
