Lawmakers from the Assembly and Senate say they're close to unveiling a Democrat-backed budget to send to Gov. Phil Murphy, but with one caveat – a last-minute rewrite of the proposed corporate business tax.
Under the new proposal, laid out by Democratic leadership of the Senate and Assembly, corporations that earn between $1 million and $25 million would see their CBT rate increase 2.5 percent. For companies earning more than $25 million, their CBT rate would increase by 4 percent.
“I’ve said this and I feel strongly about it, the Trump tax cut was a windfall to corporations,” Senate President Stephen Sweeney, D-3rd District, said Monday afternoon, calling the funds “$2.9 billion of money that’s falling out of the sky.”
With the two-year sunset period, lawmakers expect the CBT will bring $805 million into the state budget annually.
To underscore their position, late Monday the Democratic leadership of the state Legislature issued a press release detailing their budget proposals, which Gov. Phil Murphy has vowed to veto.
As recently as Friday, the budget proposal called for the CBT rate to increase to 12 percent, up from the current 9 percent.
Earlier that morning, Murphy said he would veto budgetary counter-proposals the Democrat-controlled legislature plans to bring to his desk by the end of the week even if that means shutting down the government July 1.
Murphy said he would only support a millionaire’s tax, which today's budget rejects in lieu of a corporate business tax, which Murphy in turn rejects.
“I worry about our competition, we’re already at 9 percent, New York is at 6 1/4,” Murphy said, adding that it would “cut into small and medium-sized” businesses.
But the budget, according to Assembly Speaker Craig Coughlin, D-19th District, will still have “95 percent” of what the Governor wants.
That includes tax revenue from the sale of marijuana, taxes on Uber, Lyft and Airbnb, as well as funding towards a pilot program for free community college, expanded Pre-K and $700 million more towards the state pension.
Lawmakers are scheduled to vote the budget out of committee on Tuesday and bring it to the floor on Thursday.
Here is the full press release from the Democratic leadership in the legislature.