Having Your Cake and They're Eating It Too

This is the long awaited deal between New Jersey Democrat Gov. Jon Corzine and the Assembly Democrats. Not only does the Governor get his sales and use tax hike, but the Assembly gets a bunch of their tax hikes too.

And this is what we were waiting for?

Enlighten NJ has more (and really should be the first place to check out for figuring out the NJ budget situation). Here's the skinny:

So here’s how the deal is going to work. The average New Jersey family will pay an additional $275 with an increase in the state’s sales tax from 6 to 7%. The new budget deal will supposedly allow part of the additional sales tax revenue to go for property tax relief.

For the sake of the argument, let’s assume 100 percent of new sales tax revenue goes for property tax relief. And let’s also assume you’re a member of that average family. So you’re going to pay $275 more in sales taxes to, cross your fingers, get an additional $275 back in property tax relief.

But the budget deal calls for half of the money raised from the sales tax rate increase to be used to lower property taxes this year, and all of it to go for that purpose next year. So you’re going to pay $550 more in sales taxes over the next two years to get, cross your fingers again, $421.50 back. Every year you’re going to pay that additional sales tax and every year you can hope you’ll get it back. Now there’s a victory for New Jersey taxpayers.

The state's gross income tax (the most appropriate name one can imagine) was enacted originally to provide property tax relief in 1970. That has worked out so well that the property taxes continue to rise, the personal income tax is insuffiicent to cover expenses, and we're now culling sales and use tax increases to go to property tax relief.

That's not relief.

That's a shell game.

UPDATE:
Roberto at Dynamobuzz thinks this deal is a phony scam that will hit taxpayers harder than Democrats want you to believe:

The supposed deal clincher was an agreement that the sales tax would increase from 6% to 7%, but half of the increase would be constitutionally dedicated to property tax relief. Of course, the voters still need to approve any change to the constitution, so until then the money goes to the state treasury to spend as they please. And this "compromise" could be null and void after the special session on property taxes scheduled for later this summer. This is a phoney compromise, barely worth the napkin it was written on, but it gives both sides cover.

My understanding is once a budget comes out of committee, they have to wait 24 hours for a vote by the full body. That gives them a day to actually read the bill before they vote on it.

Roberts had been proposing a bunch of other tax increases in place of the sales tax hike. Assembly democrats were talking about a 1% income tax surcharge and increasing a state disability tax, amongst other taxes. Not sure where that plan is now, there is no mention in the current media reports.

Ankle Biting Pundits notes the tax hikes and fiscal irresponsibility. So does Blue Crab Boulevard. However, more entertaining are the comments from folks who have friends or relatives who moved to New Jersey from New York. I'm not only someone who used to live in New York, but I used to work in the NYS Assembly for a member's office. As bad as things got in Albany while I was there (never passed an on time budget while I was there), they at least managed to maintain the facade that it was Democrats v. Republicans. New Jersey didn't even bother with that - Democrats were fighting amongst themselves over how much to tax us.

There was a good reason to consider that the budget battle was a test of wills between the South Jersey Democrats and Corzine. Corzine blinked, but everyone got what they wanted - lots more tax hikes to go around.

Now, here's where things should get interesting: the fallout come November.

This whole budget mess is a pre-wrapped early Christmas and Hannukah and Kwanzaa gift for the GOPers all rolled into one. They've got a whole stable of quotes that can be run against those who are voting and approving this mess. And, they can use Sen. Menendez's connections to Corzine and Assembly Democrats to boost GOP candidate Tom Kean Jr. in the process.

These are tax and spend Democrats at their very ugliest - and the GOP, if they're even halfway competent should be able to manage this situation to their advantage.

The problem is that the New Jersey GOP isn't halfway competent. If they were, they wouldn't have been stuck with Doug Forrester in the election (who still would have been better than Corzine, but whose personality and campaigning was awful).

The key issues to hammer home in November:

1) Democrats keep raising your taxes - and they're raising one tax to hide the taxes they're raising elsewhere. It's a shell game.

2) Democrat ethic troubles - the cozy relationship between Corzine and the unions (which caused taxes to rise to cover their expanded benefits packages and numbers), the South Jersey machine politics, and the AG issue.

3) Did I mention taxes?

Taxes should be the top issue on the minds of voters in November - and Democrats better be worried. Republicans better get in gear to ramp up their efforts to bring fiscal sanity to Trenton, because the politicians in Trenton are having our cake, and eating it too. Assembly Republicans are already practicing the mantra. So are Senate Republicans.

Some folks note how Corzine and proponents of the tax hikes called this a 1% raise in the sales and use tax, despite the fact that the tax actually rose 16% (the increase from 6 to 7%)

Coalition of the Swilling notes the arrival of talking points - including comparisons between New Jersey and Florida.

Jim at Parkway Rest Stop also provides some political advice come November.

UPDATE:
Still others chiming in on the NJ budget 'deal' include: First State Politics, Right from the Right, blogsheviks, and The NJ Blog.