New Jersey Nightly News; 119; A Closer Look: Gubernatorial Issues / New Taxes

I am. The state's present revenue structure no longer produces income that increases as fast as inflation. Put another way last year inflation reduced the state's buying power by more than 10 percent while state revenues did increase. They did not grow enough to offset this loss. The only way to keep the state budget in balance is to cut services. But even this solution won't work forever. State Departments like transportation human services and higher education have already been cut substantially and now it looks like they face a loss of federal support. That means the amount of revenue which can be produced by additional service cuts is limited. We pose this problem to the front runners in both the Democratic and Republican primaries those candidates who have the best chance of winning on June 2nd. We asked them this question as a governor would you recommend any additional taxes such as an increase in the sales tax or corporate taxes to generate additional revenues for basic state services. And if not what specific cuts would you

recommend in state spending in order to maintain existing services. First the Democrats. I'm not prepared now to concede that we need additional sources of revenues in the next four years but I also want to state clearly that I don't want to rule out the possibility that sometime during the next four years as a governor I would come back to the people of New Jersey and ask them for additional authorization for taxes. I think before we do that successfully We're going to have to do a better job at convincing the public that they're getting dollars worth of service for the dollar they pay. Tax revenue collection on the part of the state government is really a contact with the people which we agree to provide services in the amount of dollars that they put in. I think we've done a fairly good job doing that over the last four years my department had was either second third or fourth lowest in three successive years in which I prepared a budget of the departments of state government. But I don't think we convince the public that we've eliminated fraud and abuse in programs in government but we've cut down to the bare minimum the number of

states we need to produce an efficient level of service. I think there's much that can be done in New Jersey to expand our economy appropriately to provide more resources to provide for more tax revenues and of course to modify the tax system so as to have it as equitable as possible to be able to fund those programs that are determined to be absolutely essential that there are consolidations that can be taken programs for education job training unemployment services programs that don't even with each other when those areas are obviously very much related so that you can consolidate our program initiatives and get better service dollars. That's something that should be explored as well. Actually we have in New Jersey should be more graduated. It was a compromise when it was passed and now I think most people realize we have to have a graduated income tax it should be graduated along the lines of the federal income tax I think it would really provide a

significant amount of revenue towards the needs of the state. We should have equalised property tax in the state not the situation where everybody taxes differently with providing services in the state. These two pieces I think some of the taxes that exist now we can continue to fund the needs of New Jersey. I think that to sit here and talk about what has to go the other way. Let's talk about that which has to remain before I get to that which number 200 on the list. I would not recommend any increase in the sales tax. Sales tax is the most regressive form of taxation we have. There is one shortcoming and we try to remedy that in the last legislative session is to put the and to address the question of sales tax to professional services.

You pay sales tax to your garage mechanic. You pay sales tax to your through on services that is for your plumber electrician. But you don't pay sales tax on your legal fees. Your accountants fee your architect's fees and we try to to extend the present sales tax to those areas that would be one legitimate extension of taxes which I would have no objection to. This interview. Would not be recommending. I think what we ought to be doing is having. Many people on the campaign trail. The truth is that money being invested that sort of thing. So I want to tire situation. I think the

state is a tremendous industry. You know jobs and things of that nature I think we've got to reverse that primary state business and industries in the state then we can start to change the picture a little bit I think we can. I stand very strongly behind living within your resources I may come as a surprise as an urban man but nonetheless I fully understand that if we're not able to pay our taxes we're not going to have any services and people in urban areas especially are just simply playing to such a point that they're moving out of the area because they can't pay their taxes. So we have to obviously as hard as it may seem we have to take a position that says the monies are not available and if taxes are such that the now confiscatory and many situations and they are certainly in the urban areas and in some of the suburban areas as well that we have to live within our

resources. So I've taken a very strong position. I recognize better than anyone the human needs to social needs. But I also recognize that someone has to pay for them and that they can't pay for them. We're going to have less services than we had before we started on taxation system. We asked the front runners in the Republican primary the same questions as governor would you recommend any additional taxes such as an increase in the sales tax or corporate taxes to generate additional revenues for basic state services. And if not what specific cuts would you recommend in state spending and want to maintain existing services. We've got to do is reverse the tax structure in this state make it more competitive. Change some of these rules and regulations and bring in business to this state and create jobs so we can get people off welfare and employment. That's how you increase the revenues of the state. That's the only way you'll pay for existing services. We can't increase taxes. Increase taxes will compound the problem. You'll

eventually get less revenue not more revenue because you'll drive more people jobs out of the state. There are some things I like to cut and obviously get rid of. I think that can be good without any problem a 10 percent cut in the number of state employees. We've had a 14000 increase under under Brendan and that's not that's not necessary I've laid out a program on how to do it through attrition setting up Sunset review boards so that when a job somebody leaves a job with somebody that you really find out if it's really necessary. No new taxes we don't need it. There is more than enough money to operate the state of New Jersey and frankly I'm not sure it's a matter of cutting services as much as cutting expenses. We've got sixty eight thousand employees working for the state of New Jersey. That means that every time you need 39 people in this state who are working one is a state employee that's disproportionate. Why do we have to separate education departments Why isn't that one for continuity of education for both the K-12 system as well as higher

education. Isn't there an awful lot of dual approaches to those problems. I think you get the partners don't even talk to each other let alone work together on behalf of the young people want an education in this state. There are tremendous savings to be made by departments that shouldn't exist. And by departments that should be merged. Talk about what we're going to do to reduce the cost of government in this state. That's where the savings are in payroll. I'd like to see the corporate network tax repealed again going along with my program because if we increase our tax base. The need for higher rates will diminish because our revenues will stay the same. Or increase because creasing base is to increase the tax base not increase the rates. Would hold. For a number of years or being able to bring industry and create more jobs. Reduced a drain on the state resources which unemployment books and other social problems economic development. Then you can start

to reduce. Private individual taxes. And there I would first attack tax. I would look for a reduction there. I think that we can reorganize the executive branch departments I think we can reduce the number of state employees. I think that our Human Services course. Can be reduced or held constant. I want to reduce state taxes and we can do it by cutting non-essential spending at the state level. I would do away with the Department of Public Advocate. That's a department that goes around suing other levels of government I think that's sheer folly. And we can save at least four million dollars a year. Number two I would do away with the Department of Energy. I didn't vote for that department and I didn't vote for the creation of the Department of Public Advocate either. That department doesn't bring in one kilowatt of energy doesn't bring in one barrel of oil to New Jersey it's just a great big new bureaucracy we can save 3.3 million dollars a year. I would do away with the property checked rebate

program I voted against that program. I want it passed in the Senate 33 to one several years ago. And I said Put the credit on your local property tax bill. Why the process at that time it was over three million checks a year. Now it's one and a half million checks a year at a cost of over two million dollars a year. That's one of the leading candidates stand on the issue of new taxes. Tomorrow night we'll take a closer look at their positions on another important issue. What can be done to promote property tax relief in New York. I'm guessing Byrd. I. Know.