NJ Gov. Phil Murphy Hints At New Tax As Budget To Be Introduced

New Jersey Gov. Phil Murphy will deliver his budget address next week, and it could be the biggest – and most controversial – speech of his tenure.

Murphy suggested that he'll introduce a new tax proposal – perhaps a new "millionaire's tax" – to offset the state's budget woes and help fix New Jersey's broken pension system.

Murphy, speaking at the New Jersey Chamber of Commerce’s 82nd Annual Dinner in Washington, DC on Thursday, said his Tuesday budget address will speak to his "commitment to tax fairness for our middle-class families and seniors – and I mention, once again, the countless middle-class taxpayers who are wondering where their promised federal tax cut went."

"The budget I will propose in five days will include even bigger steps to move us back to the principles of good governance and sound fiscal practices that our residents demand, that the bond rating agencies want, and which administrations and legislatures of both parties had evaded for far too long," Murphy said.

The Fiscal Year 2020 Budget Address will take place in the Assembly Chamber at the New Jersey State House at 2 p.m. on Tuesday.

To avoid a budget shutdown last year, Murphy agreed to take a sales tax hike to 7 percent "off the table" and he raised the threshold on his so-called millionaire's tax proposal.

Instead, the governor and the state Legislature raised taxes to 10.75 percent on those earning $1.75 million or more – up from Murphy's initial demand $1 million. He said the tax hike would raise $550 million.

This time, as the state deals with declining revenues, Murphy suggested that he'll push for something closer to his original demand.

“New Jersey deserves a budget built upon the values that can deliver a more secure and growing middle class – sustainable savings, responsible fiscal management, smart and targeted investment, and fairness,” said Murphy.

“Over the past year, we have done much to restoke New Jersey’s competitive fires and put our state on a new trajectory for a stronger future. On Tuesday, we’ll continue that mission with a budget that invests in New Jersey’s middle class and those working hard in hopes of joining its ranks.”

Murphy said the state has been hurt by President Trump's tax reform, which modified the state and local tax deduction.

"I have met some of the residents preparing their federal taxes and who are now wondering what happened to the tax cut they were promised," he said. "This is a matter of fairness, and I am proud to join our delegation in the fight to restore the full SALT deduction."