We all know that “temporary” tax increases have a tendency to become permanent. At the time they are first imposed, their proponents deny that they are really tax increases at all because they are only temporary, justified as necessary for some particular, presumably equally temporary, economic condition. Then, when the temporary increase is made permanent just as it is supposed to expire, the proponents again deny that there is really a tax increase: the temporary increase is just being made permanent. Despite there being no tax increase on the front or back end, taxes have in fact been raised, but no one is responsible. Now suppose that the temporary increase is allowed to expire; that is criticized as a tax cut.
The constant refrain of those who wish to have the government be in charge of spending more of your money is the claim that “the rich” do not pay their fair share. We know this because they have some left. The view that others should pay more taxes so that we can get more benefits is exactly what I talked about almost two years ago as the “SEP Problem;” which means that “someone else is paying.”((Charity is indeed a virtue, but is it really charity to give other people’s money to the poor?)) This view is reflected in Tom Moran’s recent editorial “Murphy’s temper tantrum, and the makings of a budget deal” (subscriber exclusive).
Moran begins by describing mansions in Montclair((Opinion pieces, whether labeled as such or not, often begin by personalizing the argument; either by introducing a sympathetic person who would be benefitted by the writer’s position or vilifying those who would be hurt.)) and asserting that their owners should not qualify for StayNJ, Assembly Speaker Craig Coughlin’s proposal to provide a property tax credit/rebate for senior citizens with no income limit for eligibility.((This proposal is discussed in my two most recent posts: Plan to Cut Property Taxes for Senior Citizens Seems like an Expensive Gimmick and StayNJ Details Revealed: It Is a Gimmick.)) Moran cites as support for his position none other than well-healed Governor Murphy, whom he quotes as saying, “I don’t think we should be in the business of giving the likes of me tax breaks.”
Moran then pivots to say that Murphy is in fact giving the rich (personified as Jeff Bezos, the Amazon founder and multi-billionaire) a tax cut because Murphy insists that the 2.5% corporate tax surcharge imposed in 2018 should be allowed to expire at the end of the year, almost as promised. (The surcharge has already been extended once, among the many things blamed on COVID.) Moran’s point is that the the temporary tax increase should be made permanent and used to fund a means-tested tax subsidy.
What about the promise that it would be temporary? “[Murphy’s] promise in 2018 does not obligate the Legislature of 2023 even one bit.” Legally correct, which only strengthens the view that voters should NEVER rely upon the promises of politicians. They have no credit because there is no obligation to keep their word.
Jay Bohn
June 1, 2023