N.J. Budget Adds Taxes, Cuts Education

New Jersey Gov. Jon Corzine delivered a sobering budget plan Tuesday that would increase sales, alcohol and cigarette taxes and break his campaign promise to sharply cut residents’ highest-in-the-nation property taxes.

Facing a multibillion-dollar budget gap, the former Wall Street whiz told lawmakers he had no fiscal tricks up his sleeve as he proposed a $30.9-billion budget that slashes funding for higher education and other programs as it aims to free New Jersey from years of overspending and mounting debt.

“Budgets are the numbers, words and choices that capture our values,” Corzine, a Democrat, told officials and lawmakers gathered at the Statehouse. “My proposal will be about the hard choices and the numbers that will put our state on a pathway to financial stability.”

In all, Corzine hopes to raise $1.8 billion through new taxes and to cut more than $2 billion in spending as he attempts to close an estimated $4.3-billion gap.

He also hopes to generate more than $1 billion in revenue by raising the state sales tax from 6 cents to 7 cents on the dollar. The average New Jersey family of four would pay about $260 more a year in sales tax under the proposal. Clothing and food are exempt.

Taxes on a pack of cigarettes would increase 35 cents to $2.75 per pack, and levies would also increase on wine, beer and hard liquor.

Republican legislative leaders, who are in the minority in both chambers, had little praise for Corzine’s plan. They suggested that the near-absence of applause during the governor’s address was evidence that his fellow Democrats also had little enthusiasm and said cuts to school aid would force property taxes to increase.

“This budget is a fraud on the people of New Jersey,” Assembly GOP leader Alex DeCroce said. “He promised he would reduce spending. Instead, he increased property taxes.”

The governor deserves some credit for incorporating cuts suggested by Republicans, but more cuts are needed, DeCroce said.

Democrats were slightly more generous, but they too were leery of endorsing a budget plan with so much new tax.

“Today’s speech only marks the beginning of a more intensified budget review process as the Legislature begins its work of weighing the impact of spending cuts and the governor’s tax proposals,” Assembly Speaker Joseph J. Roberts Jr. said.