Around dinnertime June 30 – with the clock ticking toward the midnight deadline – New Jersey’s state budget deliberations were at a turning point. Gov. Phil Murphy and Democratic legislative leaders, straining to avoid another government shutdown, emerged from the harried meetings with a deal in principal. They would cover the state’s growing expenses by hiking taxes on both the state’s wealthiest earners and biggest corporations.
The tax change won’t dramatically increase most business’ bottom line, but it will damage the perception of New Jersey, said David Shipley, a tax attorney at McCarter & English. “The higher rate sends a message that New Jersey is not friendly towards business,” Shipley said. “The message it sends is really going to be overshadowing the reality that there’s not going to be a big difference.”