Urges Governor to Sign Bipartisan Bill to Provide Tax Cut for Small Business
TRENTON – Senate Majority Leader Barbara Buono today challenged Governor Christie to prioritize the needs of small businesses across the state by signing bipartisan legislation she sponsored that could amount to the largest small business tax cut in state history.
Buono said she was troubled by the many recent reports in which the governor said he would prioritize a lowering of the state’s 9-percent corporate tax rate in his upcoming budget. But, she noted that many small employers are not incorporated and do not file their taxes under the corporate code.
“If the governor is committed to cutting taxes on business, he could give small businesses a meaningful tax cut before he even leaves this afternoon for Washington, DC,” said Buono (D-Middlesex). “If the governor wants to talk about giving big businesses a tax cut we can have that conversation, but he first should give a much-needed tax break to the many small businesses that are truly going to fuel our state’s economic revival.”
The Buono bill (S-1540) would provide sole proprietors and other small business owners with a tax cut by requiring the personal income tax code – through which they file – to treat them the same way as the corporate code does large corporations. Currently, New Jersey’s personal gross income tax is calculated through 16 separately defined categories of income. However, unlike the federal tax code and the tax laws of 48 other states, state tax law does not permit filers who generate income from different types of businesses to offset gains derived from one business entity with losses sustained from another.
Buono’s bill would consolidate four of those income categories to allow “cross-netting” of gains or losses from one category of income to another and give small business owners the same ability to recoup losses over 20 years that large corporations currently enjoy under the state’s business tax code. Also sponsored by Senator Steve Oroho (R-Sussex/Hunterdon/Morris), the bill was unanimously passed by both houses.
According to the Small Business Administration’s latest profile of the state, New Jersey’s 205,321 small businesses made up 98.5 percent of the state’s total number of employers and accounted for 51.1 percent of all employment.
Today is the state Chamber of Commerce’s annual “Walk to Washington,” with the governor slated to attend at tonight’s dinner in the nation’s capital. Buono urged the governor to sign her legislation along with the 29 other measures in the “Back to Work NJ” economic growth package. Also included in the package is legislation that would reform the state’s business tax code to remove a disparity that had put in-state businesses at a disadvantage with their out-of-state competitors.
“What a great message the governor could send to the state’s business leaders, and those in other states, if he would sign these measures,” said Buono. “Businesses have been waiting a long time for tax relief, and they shouldn’t have to wait another day.”