Assembly Republican Leader John DiMaio staunchly opposes the proposal to increase the sales tax to address NJ Transit’s budget deficit. Lobbyists suggested raising the tax from 6.625% to 7% to substitute Governor Phil Murphy’s corporate transit fee, applying a 2.5% surcharge to businesses earning over $10 million.
DiMaio, representing Warren and a member of the Republican party, expressed concerns about the adverse effects another tax raise could have on businesses, the economy, and residents facing financial strain due to escalating costs.
In 2016, legislators reduced the sales tax from 7% to 6.625% through an agreement with the then-Governor Chris Christie, who raised the gas tax by 23 cents to support the Transportation Trust Fund.
This move also entailed tax benefits for veterans, enhanced earned income tax credit for the working class, and the elimination of the estate tax. According to DiMaio, the current administration and Democrats are keen on imposing further tax burdens, citing potential elevations in property taxes to compensate for lacking school funding and transferring NJ Transit issues onto businesses, commuters, and consumers, leading the state in an unfavorable direction.
NJ Transit recently sanctioned a 15% fare increase effective from July 1, with subsequent annual increments of 3%. Governor Murphy endorsed legislation to escalate the gas tax incrementally over five years to facilitate transportation infrastructure projects. Additionally, the Assembly sanctioned a bill enabling school districts to boost property taxes by up to 9.9% without voter consent in the event of state aid reductions.
DiMaio criticized these moves as contradictory to Democratic claims of prioritizing affordability, asserting that such steps would further strain individuals financially, potentially impacting businesses negatively, as he emphasized New Jersey’s spending-related challenges over revenue issues.