New Jersey State Governor Phil Murphy recently signed into law a bill that renews sales tax cuts for five towns in the state. The measure taken by Governor Murphy effectively reverses a decision made last year by former Governor Chris Christie to nix a program that brought sales tax relief to these five jurisdictions.
The program in question is the Urban Enterprise Zone program and it allows for New Jersey citizens in the towns of Trenton, Newark, Camden, Plainfield, and Bridgeton to pay a sales tax on purchases of 3.3% versus the normal rate in the state of 6.62%.
Christie expressed the opinion when he decided not to renew the program which he characterized as a failed "30-year experiment", that the UEZ was intended to be a temporary solution to provide aid to municipalities that were financially distressed but is no longer viable due to the loss of revenue that state is experiencing due to the program.
Governor Murphy's decision to rekindle the program comes with the requirement that the Department of Community Affairs in New Jersey closely monitor the program and report findings to state legislators. The department is also instructed to give its recommendation as to whether the program should be continued in its present state, improved, or scrapped in entirety.
Peter Kasabach, Executive Director of New Jersey Future, says the UEZ has been and continues to be of utmost importance to the five communities it effects to spur growth economically and encourage job creation for individuals living in these towns. Kasabach adds that he does think the program can be improved.
Some Republican lawmakers in the state publicly voiced their opposition to the sales tax cuts while reiterating the stance of former Governor Christie by calling the program a "proven failure" that has not facilitated growth economically while depriving the state of revenue.
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