23-Cent Gas Tax Hike Moving Forward In New Jersey

New Jersey's known for its cheap gas, but you could be paying more at the pump if lawmakers have their way.

State Senate lawmakers introduced bipartisan legislation Monday that would hike the state's gas tax by 23 cents - another $2.30 for $10 at the pump - and replenish the state's bankrupt Transportation Trust Fund, which funds major road construction and repair.

The 23-cent increase, if added to New Jersey’s current 14.5-cent tax, could result in a 37.5-cent per gallon cost that would still be lower than New York, Connecticut and Pennsylvania, lawmakers said in a news release.

The bipartisan legislation, authored by state Sens. Paul Sarlo and Steve Oroho, would renew the Transportation Trust Fund with dedicated funding to meet the state’s critical infrastructure needs, according to lawmakers.

The 10-year, $20 billion proposal is a "detailed and far-reaching plan that will address New Jersey’s vital transportation needs" while delivering an economic boost, Sarlo said in a news release.

"This is a balanced, bipartisan plan that should gain the support of legislators, transportation advocates, workers and the business community,” he said.

The proposal is already facing an uphill climb, however.

Gov. Christie told the Morris County Chamber of Commerce this week that he will not sign a gas tax increase unless it "represents tax fairness for the people of New Jersey."

He acknowledged that companion legislation would provide a series of wide-ranging tax cuts that, lawmakers said, are designed to create jobs, strengthen New Jersey’s economy and create tax fairness was also introduced.

Christie, however, said the tax cuts may not be enough, although he didn't get into specifics.

Last week, Republican Sens. Jennifer Beck and Michael Doherty held a Statehouse news conference to condemn the gas tax proposal, saying any such tax hie could damage the state's already ailing economy.

Sarlo said the renewed TTF would invest $2 billion a year for 10 years to repair, upgrade and maintain the state’s roads, bridges, tunnels and railways.

A sustained investment of $2 billion annually would produce an estimated $4.7 billion a year in economic activity and create more than 34,000 jobs directly and indirectly, with annual payrolls of $1.4 billion, according to a recent study cited by lawmakers.

The plan would create a 12.5 percent petroleum tax and a 4-cent-per-gallon surcharge on diesel fuel, all imposed at the wholesale level. The tax would be capped at three dollars, meaning the surcharge would not be applied to sales above three dollars a gallon.

The tax savings plan, meanwhile, includes an increase in the Earned Income Tax Credit to 40 percent for the working poor, an increase in the tax exemption on retirement income, a tax deduction for charitable contributions and a phase out of the estate tax, lawmakers.

“This is a plan that delivers tax fairness with a tax structure that is more competitive with other states by reducing taxes on senior citizens, middle class families and on estates that are passed down from parents and grandparents,” said Oroho.

Photo: By Tysto - Own work, Public Domain, https://commons.wikimedia.org/...