New Jersey kicked off the new fiscal year on a strong note as July’s major tax collections rose 12% compared to July 2018.
The Department of Treasury reported Wednesday that collections from major revenue sources totaled $2.33 billion, a $250.1 million increase from the year-earlier period.
The Garden State saw the biggest monthly increase with corporate business taxes, which jumped 32.6% from last July to $177.8 million. New Jersey is now more than halfway through the second year of a temporary 2.5% CBT surtax on incomes above $1 million. The temporary surtax will decrease to 1.5% starting January for a two-year period before phasing out.
The Gross Income Tax, which is dedicated to the state’s Property Tax Relief Fund, rose 15.5% from July 2018 for a total of $948.9 million, a $127.5 million jump. The sales and use tax, which is New Jersey’s general fund revenue source totaled $1.02 billion for the month, a 5.1% year-over-year rise.
Total revenues for 13 months ending in July jumped $3.175 billion, or 9.9%, which the Treasury Department attributed to “numerous tax policy changes” enacted last year. The yearly spike included a big April when gross income tax payments
July began the 2020 fiscal year after Gov. Phil Murphy
A growing pension burden coupled with structurally imbalanced budgets triggered 11 rating downgrades for New Jersey general obligation bonds between 2011 and 2017 making Illinois the only U.S. state with lower-rated debt. New Jersey GOs are now rated A-minus by S&P Global Ratings, A3 by Moody's Investors Service and A by Fitch and Kroll Bond Rating Agency.