NJ Budget: Murphy Proposes Tax Increase On Millionaires, Cigarettes & Gun Permits

Peter Haskell
February 25, 2020 - 6:18 pm
Governor Phil Murphy

Edwin J. Torres for Governor’s Office

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TRENTON, N.J. (WCBS 880/AP) — New Jersey Gov. Phil Murphy officially unveiled a $40.9 billion budget for fiscal year 2021 on Tuesday.

In his third state budget since he was sworn in in 2018, Murphy proposed boosting overall spending by more than 5% compared to last year and once again pushed for a Millionaires' Tax.

“Asking the wealthiest 22,000 New Jerseyans to pay two cents more in income tax for every dollar they make over a million dollars is simple fairness,” the governor said.

Among other initiatives, the multi-billion dollar budget also calls for higher spending on education, transit and public pensions. Murphy has also suggested setting aside $1.6 billion in surplus.

The Democrat cast the budget as a continuation of his campaign pledge to make the state “stronger and fairer,” though Republicans attack him for proposing tax increases, which they argue makes the state less affordable.

Democrats, who control the Legislature, seem as though they are also unwilling to accept tax increases.

Gov. Murphy is also seeking to boost school aid to $465 million, a nearly 5% increase from last year. He is also seeking $30 million for a community college grant program to provide free tuition to almost 10,000 students whose families earn $65,000 or less.

Under his budget, he would set aside $50 million to expand tuition-free college for the first two years at New Jersey’s public colleges and universities.

Gov. Murphy is also looking to bolster New Jersey Transit with more funding once again. He’s proposing a 30% increase from last year for a total of $590 million in 2021.

There is also a plan to increase the state cigarette tax from $2.70 a pack to $4.35 per pack.

Additionally, the governor wants to raise the cost of a handgun permit for the first time in over 50 years.

“This is not about the Second Amendment, but this is about public safety,” Murphy declared.

The proposal would boost the state’s rainy day fund to $1.6 billion in 2021.

Murphy’s proposal must be approved by the Legislature, which has the power to change it, before a June 30 deadline. The state budget be in place by the start of the fiscal year on July 1.

(© 2020 WCBS 880. The Associated Press contributed to this report.)