Trenton – Acting to provide middle class families with additional financial support, the Senate today approved legislation sponsored by Senator Dawn Marie Addiego that will deliver tax breaks of $500 to low- and middle-income families in New Jersey. The rebate program will reach an estimated 800,000 families, providing much-needed financial relief at a time of economic distress and uncertainty.
“Families are struggling with financial challenges and uncertainty at a time of economic upheaval,” said Senator Addiego (Atlantic/Burlington/Camden). “This will help New Jersey move forward through a time of crisis and provide middle class families additional support with a lasting tax cut. It will put money into the pockets of working families so they can support themselves and their children at the same time it puts money into the economy, helping generate jobs and business activity in communities throughout the state.”
Under the plan, S-2949, rebates will go to single-parent families with incomes up to $75,000 and to two-parent households earning up to $150,000. An estimated $335 million would be distributed next year, when the program is in place.
Approved earlier by the Assembly, the bill now goes to the governor.
The program would be funded by a “millionaires’ tax,” with an increase of less than 2 percent only on income between $1 million and $5 million. The rate would go from 8.97 percent to 10.75 percent, matching the current rate paid on income of over $5 million. The increase is expected to raise about $390 million.
“I believe that taxes should only be enacted when they are desperately needed and only when the revenue will be used responsibly and effectively,” said Senator Addiego, who serves on the Budget Committee. “The pandemic has caused a wholesale economic upheaval, the lives and livelihoods of so many have been disrupted and, for some, all but destroyed. We are asking those who can most afford it to contribute a bit more in a time of crisis to help those in need.”
To provide additional support for middle class homeowners and seniors, the new budget includes the restoration of funding for Homestead Rebates and the Senior Freeze Program, said Senator Addiego, who fought to include the $495 million in property tax relief in the state spending plan. It also continues the tax exemption for retirement income under $100,000.
“This is property tax relief that is needed by middle income families and senior citizens living on fixed incomes,” said Senator Addiego. “I made the restoration of funding a legislative priority because it is a financial priority for New Jersey residents.”
The Senate vote was 25-14.