Another round of stimulus checks is very unlikely, but New Jersey may give its citizens some direct relief. So far, the New Jersey government hasn’t revealed any such plans to give coronavirus stimulus checks. Rather, Republican state senators want the state to offer direct tax relief from its $5.2 billion tax revenue windfall.
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Earlier this week, state Treasurer Elizabeth Muoio revealed that the state’s tax revenue would be $4.1 billion more than expected in the fiscal year that ends June 30. In the next year, the tax collections are expected to be $1.1 billion more than expected.
Moreover, the latest Treasury Department’s projections show that the state would have $10.1 billion in reserves. This is a stark turnaround from last year, when the state borrowed billions to offset projected revenue losses.
Thus, Republican state senators are asking the state to return some funds back to the taxpayers in the form of tax rebates and expanded property tax relief.
“If we do give the money back rather than hoard it in government, and make it more productive, our economy can grow more, and we’ll have potentially less need for increased state tax dollars later,” Sen. Declan O’Scanlon (R-Monmouth) said, according to nj.com.
Gov. Phil Murphy has about three weeks to finalize the budget for the fiscal year beginning July 1. Murphy’s proposed budget includes full pension contribution, increased public school aid, and funding for tax rebates of up to $500. It is estimated that about 764,000 households will receive rebates this summer.
Moreover, the Murphy administration may also close out 2022 fiscal year with a balance of $2.2 billion in the “rainy day fund.” Previously, the administration was planning to leave no balance in this fund. The “rainy day fund” or the Surplus Revenue Fund serves as a cushion in case of a revenue shortfall.
Three weeks left to decide
With about three weeks left for the lawmakers to approve the budget, it will be interesting to see how lawmakers plan to spend the expected windfall.
Demands are also being made to support undocumented immigrants in New Jersey who faced financial hardships during the pandemic.
“We will continue to discuss proposals with legislative leadership to determine the best uses of state funds,” Alyana Alfaro, a spokeswoman for the governor, said.
Apart from the expected windfall, the lawmakers also need to decide on what to do with more than $6 billion in COVID-19 relief funds that the states got through the federal American Rescue Plan Act.
It’s an election year in New Jersey with Murphy facing reelection this fall. All 120 seats in the Legislature will also be up for voting this year. Earlier this week, GOP voters selected Jack Ciattarelli as their nominee. Ciattarelli is a former Assembly member, as well as the founder of a medical publishing company.
