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N.J. Democrats in Legislature Ditch Murphy's Millionaire Tax

N.J. Democrats in Legislature Ditch Murphy's Millionaire Tax

(Bloomberg) -- New Jersey lawmakers are pitching a $38.7 billion spending plan that lacks the millionaire’s tax that Governor Phil Murphy insists must be in effect starting July 1.

Their budget bill also got rid of Murphy’s new or higher taxes on corporations and prescription opioid manufacturers, and a $317 million rainy-day fund deposit. It retained Murphy’s $3.8 billion pension payment -- a record, though a pittance of what’s owed -- and added $50 million to what would be a $25 million net increase to the budget for New Jersey Transit, the struggling mass-transit provider.

N.J. Democrats in Legislature Ditch Murphy's Millionaire Tax

“All options are on the table,” Murphy, a first-term Democrat, said at a Trenton news conference when asked whether he would sign a budget without a millionaire’s tax, and whether the state could be headed for a shutdown.

Democrats who control both houses of the legislature plan to vote on their budget version on June 20. In all, they want to spend $100 million more than what Murphy proposed in March. Last year, Murphy and legislative leaders averted a government shutdown when they made agreements including charging higher taxes on those with incomes over $5 million, rather than on the $1 million-plus earners that the governor had wanted.

This year, Murphy says a millionaire’s tax would generate more than $500 million in revenue, and he pledged middle-class tax credits in return. Senate President Steve Sweeney, a Democrat from West Deptford, has said lawmakers won’t support that proposal.

To contact the reporter on this story: Elise Young in Trenton at eyoung30@bloomberg.net

To contact the editors responsible for this story: Flynn McRoberts at fmcroberts1@bloomberg.net, Stacie Sherman

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