Tuesday, February 19, 2008
Enlighten - New Jersey is continuing his series on the "education of the New Jersey taxpayer," this time with a discussion of the changes in the Garden State's system of
confiscation taxation over the last ten years (part one, dealing with the expense side of the budget, is here). There is much that is interesting in there, including this:
As Governor Jon Corzine explained in his 2008 Budget in Brief, 85 percent of the state’s income tax revenue is paid by 20 percent of the state’s income tax paying households.
While affluent New Jerseyans may feel oppressed by that burden, it is actually almost identical(pdf) (see table 2, page 7) to the share of federal income taxes paid by the top quintile of Americans -- blue New Jersey, therefore, is no more progressive for the top fifth than the United States as a whole, even after the notorious "Bush" tax cuts that the Democrats have promised to repeal.
That said, the increase in marginal state income tax rates (for ordinary income) for the top earners in New Jersey under the McGreevey administration -- from 6.37% to 8.97% -- effectively erased more than half of the allegedly excessive Bush tax cuts for affluent New Jersey residents. If, therefore, the Democrats do allow the Bush cuts to expire, high income New Jerseyans will be paying income tax at a substantially higher aggregate marginal rate than they were in 2000. You might decide you do not care, but it is hard to imagine a more powerful argument against locating a business here.
Was there a "McGreevey Administration"? I must have blinked in between the election and the indictments.
What's more pathetic: the Governor's inability to constrain spending, or the Princeton Packet's inability to understand it is even possible to constrain spending?