US business owners and industry groups have criticised plans to implement a payroll tax in Jersey City, saying it would limit competitiveness and aggravate an already inhospitable tax environment.
The plan, which is moving swiftly through the state legislature, would allow the city to impose a 1% tax on an employer’s payroll, with potential exceptions made for the wages of city residents. Proposed as a way to fund Jersey City's public-school district, it has been approved on a party-line vote by a state Senate committee, according to NJ.
But the Hudson County Chamber of Commerce opposes the move. Its president and chief executive, Maria Nieves, said state lawmakers did not seek input from Jersey City employers before proposing the idea, which she thinks will have a higher impact than its supporters believe.
"At some point, this new tax is going to have to be absorbed in some way," she said. "When the cost of doing business increases, that cost is usually absorbed at some point down the line by employees who may see less in terms of benefits or raises. And it goes back to consumers."
The New Jersey Business & Industry Association is also opposed to the move. "This tax proposal would place an additional burden on businesses of all sizes and increase their cost of doing business," said vice president Andrew Musick. "This additional tax would add to the already high property taxes, new labour mandates and energy mandates passed over the last few months."
A survey by US News and World Report ranked New Jersey 47th on a list of states with low tax burdens. But the Tax Foundation ranked it as having the worst business climate in the country, citing its high property taxes and “some of the worst-structured individual income taxes”.
Newark is the only municipality in the state that operates a payroll tax. The Bill under consideration by state lawmakers, S-2581, would allow Jersey City to implement one too and require the revenue be given to the 29,000-student school district.
If it becomes law, Jersey City must ultimately approve the tax. Mayor Steve Fulop is publicly neutral, with city spokeswoman Hannah Peterson saying the administration would like to see the final Bill before weighing in. Jersey City Board of Education President Sudhan Thomas supports the tax.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
US business owners and industry groups have criticised plans to implement a payroll tax in Jersey City, saying it would limit competitiveness and aggravate an already inhospitable tax environment.
The plan, which is moving swiftly through the state legislature, would allow the city to impose a 1% tax on an employer’s payroll, with potential exceptions made for the wages of city residents. Proposed as a way to fund Jersey City's public-school district, it has been approved on a party-line vote by a state Senate committee, according to NJ.
But the Hudson County Chamber of Commerce opposes the move. Its president and chief executive, Maria Nieves, said state lawmakers did not seek input from Jersey City employers before proposing the idea, which she thinks will have a higher impact than its supporters believe.
"At some point, this new tax is going to have to be absorbed in some way," she said. "When the cost of doing business increases, that cost is usually absorbed at some point down the line by employees who may see less in terms of benefits or raises. And it goes back to consumers."
The New Jersey Business & Industry Association is also opposed to the move. "This tax proposal would place an additional burden on businesses of all sizes and increase their cost of doing business," said vice president Andrew Musick. "This additional tax would add to the already high property taxes, new labour mandates and energy mandates passed over the last few months."
A survey by US News and World Report ranked New Jersey 47th on a list of states with low tax burdens. But the Tax Foundation ranked it as having the worst business climate in the country, citing its high property taxes and “some of the worst-structured individual income taxes”.
Newark is the only municipality in the state that operates a payroll tax. The Bill under consideration by state lawmakers, S-2581, would allow Jersey City to implement one too and require the revenue be given to the 29,000-student school district.
If it becomes law, Jersey City must ultimately approve the tax. Mayor Steve Fulop is publicly neutral, with city spokeswoman Hannah Peterson saying the administration would like to see the final Bill before weighing in. Jersey City Board of Education President Sudhan Thomas supports the tax.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
