Protesters Plan Newark Rally Over Controversial NJ Business Tax

NEWARK, NJ — A coalition of activists are planning to hold a rally in Newark this weekend to demand that state lawmakers keep a controversial business tax in place.

The “Fund New Jersey, Tax Megacorporations” rally will take place at 2 p.m. on Sunday, April 30 at Military Park in Newark. Protesters said they plan to unveil a 500-foot scroll at the corner of Park Place and Broad Street that “that symbolizes how much wealthy corporations make off New Jersey workers and families each year.” Learn more here.

Co-sponsors include For the Many NJ, New Jersey Citizen Action, Make the Road New Jersey, New Jersey Policy Perspective, New Jersey Working Families, League of Women Voters of New Jersey, and Clean Water Action NJ.

Here’s why organizers say they’re rallying:

“When everyday New Jerseyans are struggling, why are we about to give nearly a billion dollars in tax cuts to the largest, wealthiest, most profitable businesses like Amazon and Walmart? Join us as community members take over the streets in Newark's Financial District and call on Governor Phil Murphy to keep megacorporations paying their fair share!”

At 9 percent, New Jersey has the highest corporate tax rate in the nation. The state also charges an extra 2.5 percent for corporate profits exceeding $1 million, which is the cause of the latest controversy.

The surcharge tax – which was rolled out in 2018, the year after Gov. Murphy was first elected – was originally scheduled for step downs in 2020 and 2021. Instead, it was extended by the state Legislature in 2020, and won't sunset until Jan. 1, 2024. However, Murphy and other high-ranking Democratic lawmakers have recently shown signs that they’re willing to let it expire as the state ramps up to tackle its latest budget, which must be approved by the Legislature by June 30.

The surcharge tax – which is estimated to bring the state at least $600 million annually – doesn’t target “mom and pop” shops, activists have argued. Instead, it comes out of the pockets of the top 2 percent of the wealthiest companies operating in the state, including corporations like Amazon and Walmart, which rake in massive profits in New Jersey but aren’t headquartered here. See Related: Amazon Officially Passes Up Newark (And NJ) For New Headquarters

“The wealthiest 2 percent of businesses should be paying more, not getting a tax cut when everyday New Jerseyans are struggling,” the Newark-based New Jersey Institute for Social Justice recently tweeted.

• See Related: Tax Cuts For Rich Corporations In NJ? More Protests As Budget Nears
• See Related: NJ Needs To Keep Its 'Corporate Millionaire's Tax,' Activists Urge

Pro-business groups and some conservative lawmakers have rallied against the surcharge tax, which they say is an albatross around the neck of business owners across New Jersey.

According to an annual regional business climate analysis from the New Jersey Business and Industry Association (NJBIA), the state is last in the region “by a wide margin” when it comes to business taxes and cost competitiveness, ranking behind New York, Massachusetts, Connecticut, Pennsylvania, Delaware and Maryland. And the surcharge tax is a big part of the problem, the group says.

Earlier this month, the NJBIA and the Garden State Initiative jointly released an infographic that “presents timely facts” relating to the scheduled sunset of the surtax, as well as the “many economic benefits” of lowering the state’s CBT rate. See it here.

According to Assemblyman Christopher DePhillips, who has been a vocal supporter of dropping the tax, residents are leaving New Jersey to live in states with lower taxes like Florida, Texas and South Carolina.

Citing U.S. Census statistics, DePhillips posited that it’s not a coincidence that North Carolina has the lowest-in-the nation corporate tax rate and is also among the top states to gain the most new residents. And he says corporate taxes need to be slashed entirely – not just the surcharge.

“It is imperative that we cut our corporate business tax and not simply let the surcharge statutorily sunset,” DePhillips recently said.

Critics of the surcharge haven’t slowed protests from those who want to see it go the way of the dodo, however.

Earlier this month, working class families, labor unions and small business owners who are members of the For the Many NJ coalition held a rally and a petition drive on Tax Day.

“The CBT is the third largest tax revenue in the state and supports vital public services including transportation infrastructure, strong pre-K-12 schools and affordable housing – investments that make the state an attractive place to raise a family or start a business,” organizers said. “Ending the CBT will affect several vital programs including funding cuts to many school districts, health care services and major improvements to city facilities and infrastructure.”

• Read More: Arm Wrestling Match Over New Jersey's Business Tax Is Heating Up

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