With the end of the legislative session approaching, more than 100 workers, policy experts, and advocates from For The Many NJ rallied outside the State House to tell lawmakers: Do not cut a $1 billion check to the world’s most profitable businesses!
As state tax collections continue to come in lower than projected, members of the coalition warned that not renewing the Corporate Business Tax surcharge would threaten essential public services, programs, and infrastructure that everyday New Jerseyans rely on.
“We cannot give the largest corporations in the world a $1 billion tax cut on the backs of working people across New Jersey,” said Antoinette Miles, Interim Director of the New Jersey Working Families Alliance. “We need this revenue to fund our communities, our schools, our infrastructure, and our environment. The writing is on the wall with the fiscal cliffs on the horizon, and we have a solution right here. Lawmakers need to stop this tax cut and have these big corporations pay what they owe.”
Eliminating the corporate surcharge, a 2.5 percent tax paid only by corporations with annual profits over $1 million, would cost the state $1 billion every year. Governor Murphy said he would allow the tax to expire at the end of the year in his budget address, stating “A deal is a deal.” The state’s financial outlook has dramatically shifted since then, however, as the state is now operating at a structural deficit.
“We’ve heard a lot about a deal being a deal, but why is a deal with big out of state corporations the one that counts?” asked Peter Chen, Senior Policy Analyst at NJPP. “What about the deal to New Jersey’s commuters and students who ride buses and trains to get to work and school? Instead of honoring a deal to fix NJ Transit, we’re writing a check to Amazon and Wells Fargo instead. These are not small businesses or mom-and-pops or pizzerias paying this tax, it’s the world’s largest corporations.”
A report released earlier this year by New Jersey Policy Perspective (NJPP) found that only the most profitable 2 percent of businesses operating in New Jersey — including out of state companies like Amazon and Walmart — pay the surcharge, while 98 percent of businesses do not pay it. The report also found that more than 70 percent of the tax cut would go to companies with more than $10 million in annual profits.
“Public employees saw the damage caused during the Christie era when the state failed to raise revenues to pay for health care, education, and infrastructure,” said Dennis Trainor, CWA District 1 Vice President. “At a time when the state needs to strengthen its investments and ensure vital services to the public and continue to fully fund the pension, our lawmakers should not be robbing the state of $1 billion to hand to the likes of Amazon and Walmart.”
Earlier this month, Senate President Nick Scutari (D-Union) said he was considering maintaining the surcharge to fully fund NJ Transit, which is facing a looming $1 billion budget shortfall. Millions of residents risk losing bus and train service they rely on if the agency’’s budget is balanced through cuts.
“New Jersey Transit is facing a massive deficit, and that means fare hikes and service cuts for me and hundreds of thousands of working-class New Jerseyans who use transit to get to work,” said Margarita Rodriguez, Passaic resident and member of Make the Road New Jersey. “But instead of standing up for working families, Governor Murphy, Assembly Budget Chair Eliana Pintor Marin, and Senate Budget Chair Paul Sarlo will give a billion-dollar tax break to mega-wealthy corporations like Amazon, a well-known violator of workers’ rights. Which side are you on? Do you stand with New Jersey workers and students, who need a functioning public transit system, or billionaire corporations? Don’t let NJ Transit crumble. Listen to your constituents and keep the Corporate Business Tax Surcharge. It is time Amazon pays its fair share.”
Members of the coalition also pointed to other programs and services that are underfunded or at risk of being cut, from affordable housing to environmental protection. Six percent of the corporate business tax is dedicated to environmental purposes, for example, funding open space preservation and the upkeep of city parks, farmland, and historic sites.
“Corporate business tax funding is vital to maintaining open space, which is important for outdoor recreation and is also an economic boon. Outdoor recreation in New Jersey was valued at $20.3 billion in 2021 alone,” said Ed Potosnak, Executive Director, New Jersey League of Conservation Voters. “This money should continue to be invested in open spaces, which brings environmental and economic benefits for the entire state. We’re asking Governor Murphy and the New Jersey Legislature to continue our state’s long legacy of support and funding for land preservation and open space by not letting the surcharge expire. The expiration of the surcharge on the 2 percent wealthiest corporations would mean the loss of $480 million in critical open space funding over just 10 years and will do irreparable harm to our beautiful state.”
“We have a lot of talents in New Jersey, and one of them is being able to walk and chew gum at the same time,” said Matthew Hersh, Director of Policy and Advocacy at the Housing and Community Development Network of New Jersey. “We should not have to consider abandoning an immensely important revenue stream at the risk of losing tools that help all New Jerseyans. We’ve seen the effects of austere budgeting and what it looks like when state agencies are not properly funded. We know that fewer resources in housing means fewer affordable homes.”
With a $1 billion novelty check in hand, the coalition called on the Legislature and Governor Murphy to extend the surcharge permanently, and invest those funds in services and programs that working families rely on.
“Since the corporate surcharge was enacted, corporations like Amazon continue to enjoy record-breaking profits every year,” said Liz Glynn, New Jersey Citizen Action Director of Organizing. “But New Jersey working families have struggled to meet essential needs, and these needs continue to grow. The revenue received from the surcharge has helped meet the growing infrastructure and service needs of low-and moderate-income families across our state. Now is not the time to sunset the surcharge. We urge Governor Murphy and our State Legislature to extend the surcharge and help ensure everyday New Jerseyans can prosper during these difficult times.”
Watch a recording of the event here.
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For The Many is a statewide coalition of more than 30 organizations working to expand funding for essential services and improve budget practices to meet current and future needs, especially for communities that have been historically left behind.
