New Jersey Governor Chris Christie has said he wants a 10 percent tax cut.
Tomorrow he will have to tell the world how he plans to pay for it.
The tax cut in question would reduce the state income tax by 10 percent, phased in over three years. The budget address will be the first time Christie will show how to pay for this priority item.
He’s already set the scene by reining in the state’s spending, according to Rutgers economist Joe Seneca. “The highlight being a cap on municipal spending and school spending,” Seneca said.
“Now, he’s trying to translate that further on the revenue side by reducing income tax rates, the one state tax rate that he can control – as opposed to property tax rates, which are a combination of municipal decisions and state decisions.”Seneca said that, carefully handled, the income tax tool should be something Christie can wield without serious consequences.
However, he noted that the state forecasts only modest economic growth this year under the best possible scenario. With rising gas prices and the threat of a European crisis, he said Christie will have to weigh his priorities extra carefully in this budget.