New Jersey businesses are likely to see changes ranging from tax policy to how the state approaches economic development as a result of Chris Christie’s victory in last week’s gubernatorial election.
State business owners said they’re interested in how Christie will approach business issues, particularly economic development and taxation. Christie proposed lowering income taxes and dramatically reducing state spending during his campaign.
Questions affecting business and the economy were at the center of the election, with Christie saying he would halt new regulations for 90 days at the beginning of his term. He has said it is important to improve the business tax climate — the worst in the country, according to the nonprofit Tax Foundation.
It is not clear how much of Christie’s economic development approach will be announced before he is sworn into office. He has said that Kim Guadagno, who ran on his ticket as lieutenant governor, will lead a task force designed to reduce red tape, a signal that the new position she holds could become important to state businesses.
Robert Briant Jr., chief executive of the Utility and Transportation Contractors Association, said a top business priority must be to resolve the near-exhausted Transportation Trust Fund.
“We have no means to invest in our transportation systems,” he said. “It needs to be addressed immediately. We have to come up with a source of cash revenue — no more borrowing. There is a borrowing component, but it cannot overshadow the rest of the program.”
New Jersey Chamber of Commerce President Joan Verplanck said Christie should cut the corporate business tax surcharge and income taxes on high-wage earners. She is hopeful he understands the importance of rolling back taxes and making the state more competitive.
Verplanck said the chamber had a good relationship with Gov. Jon S. Corzine, but said Christie’s plan to reduce regulations is “a great start.”
“I would hope that either the governor or the lieutenant governor would have, as one of their primary duties, chief marketer for the state,” Verplanck said.
The election also saw the narrow passage of the $400 million open-space bond, and one seat in the Legislature changed parties — Republican Domenick DiCicco won the Assembly District 4 seat formerly held by Democrat Sandra Love, who did not seek re-election.
Verplanck said she was surprised with the passage of the open-space question, considering the amount of debt the state has.
Michael McGuinness, CEO of the New Jersey chapter of commercial real estate group NAIOP, said it will be cuts, not new revenue streams, that Christie will have to count on to solve the looming budget crisis.
“He needs to spend a significant amount of time examining how other states and other jurisdictions have addressed similar problems,” McGuinness said. “There are a lot of best management practices out there that New Jersey should consider.”
New Jersey Business & Industry Association President Philip Kirschner said he is looking for Christie to set a tone “that New Jersey is open for business.”
Chamber of Commerce of Southern New Jersey President and CEO Debra P. DiLorenzo said the state has had too great a reliance on tax increases and that the focus now must be on cutting both spending and taxes. She said the income tax on high earners is a good place to start.
“Most of the people that are earning that $500,000 level that’s being taxed extra now, those are small businesses,” DiLorenzo said, noting S corporations pay their taxes as personal income.
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