There have been some dubious tax hike (and actual tax hike) proposals in New Jersey. The most obvious, and arguably the most ridiculous, was Gov Florio’s toilet paper tax. Or an example I used this past Halloween to give my two young daughters their first introduction to the effects of taxes on our lives was the New Jersey Pumpkin Tax. When you buy a pumpkin for groceries in our great state, you don’t pay sales tax on it. However, if you use the same pumpkin as a decoration, you will pay sales tax on it. My four year old said “Daddy, this is silly” when he heard New Jersey tax pumpkins; I wanted to use a different set of adjectives but managed to keep my tongue out. But these are pale in comparison to the absolute monstrosity of a tax enacted by the Murphy administration; New Jersey’s first statewide property tax is called the New Jersey Covid-19 Emergency Bond Act.
How this catastrophe came about requires a brief trip back in time. After the outbreak of the coronavirus pandemic, there was a lot of “speculation” about what they could / could not do with our national budget. Gov Murphy and the Democrats in the Legislature wanted to borrow $ 9 billion without voter approval. The New Jersey Republicans filed a lawsuit to halt Murphy’s plans because they argued (and history has confirmed the Republicans’ argument) that the borrowing itself was unnecessary because the state simply did not have the fixed income at the time to decide if borrowing is necessary. Ultimately, New Jersey’s revenues were stronger than expected, and the state Supreme Court-approved (but still incredibly large) loans weren’t even necessary, but the Murphy administration borrowed them anyway for electoral reasons.
How does this bond become a statewide property tax? The answer is how it is repaid. The New Jersey Covid-19 Emergency Bond Act requires statewide property tax if the state cannot repay the bond on time. Given the amount of spending and debt the state of New Jersey already has on its books, it’s impossible for the New Jersey Covid-19 bonds to be paid on time and for statewide property taxes to be incurred ……. automatically.
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Therefore, every citizen in the state of New Jersey will shortly receive a statewide property tax assessment in addition to their local property tax assessment to pay off a debt that they did not need or have a say in. When the Democrats finally try to say that this statewide property tax is going to be a tax on the “rich”, please understand that it is simply not true. The law requires local governments to collect the statewide tax and “use the same assessments they use to collect local property taxes.”
If any New Jersey real estate owner is affected by this statewide property tax, they can thank Gov Murphy and his enablers in law. and after families pay their annual pumpkin taxes in October, they can vote out Murphy in November.