By Briana Vannozzi
Correspondent
The studies confirmed what many who do business here already know — New Jersey remains among the highest tax states in the nation. Charles Jones is no stranger to the tax climate for small business owners.
“I would hate to even think about starting a business in New Jersey because I’ve already gone through the hoops and I’m at a certain level with all that I have to do,” said Jones, owner of CMS Refrigeration.
He’s been operating his heating, air conditioning and plumbing business out of a small storefront in Bordentown City for 30 years. Every time a new tax is mandated or increased, he says it unfortunately gets passed on to customers.
“And when we do that we lose more work because our prices are higher. It’s a vicious cycle back and forth, back and forth. But it’s not a very friendly environment to do business in New Jersey,” Jones said.
The latest report out from the Small Business and Entrepreneurship Council is just one of several released in the last few months slamming New Jersey, ranking it either last or close to it for owning a business.
“We have corporate business tax, personal income tax, property tax. We’re one of only two states that has the inheritance and estate tax and we also tax pensions. Not a great message for the business community,” said New Jersey Business and Association President Michele Siekerka.
She says a suite of tax credits needs to be implemented in the state to offset the high costs.
“The hardest challenge for a small business is that a large amount of their business income flows through their personal income statement which means a lot of their personal income is usually taxed at the highest tax bracket,” Siekerka said.
Jones says the amount of red tape also hasn’t eased over the years.
“A lot of people and businesses don’t have time for that, in other words they’re just too busy trying to make a living and they get caught up in that and all of a sudden they get fined, and you know that doesn’t really help matters,” he said.
It’s not just taxes that pulled New Jersey’s ranking down on the list. The high amount of government spending and debt also dropped its number lower.
“We don’t have many opportunities to restructure our debt any more so we need to look at how we find the right ways to invest but again if we’re going to create new buckets of money from which investments are going to come, like new taxes, then we are going to have to offset them somewhere else so that we have a net zero impact to business,” said Siekerka.
In 2015, the NJBIA says it will look to the Legislature to help mitigate the tax problem and offer more incentives, but warned that creating institutional change doesn’t happen overnight.