Corzine's Assault on Homeowners Continues

Gov. Jon Corzine wants to claim that this is a doomsday budget and that the pain will be shared. He's right about sharing the pain, but that sharing extends only as far as homeowners, and not to the state workforce or expenditures. Those are relatively unchanged, despite the massive losses of state revenues due to the recessionary environment in the state.

Corzine has engaged in stealthy tax hikes on all taxpayers. How has he done this? It's been done in two ways.

The first method I touched on yesterday with his sharp curtailment of the homestead tax rebate program for non-seniors making more than $75,000. For those homeowners, it would mean seeing your wallet emptied by more than $1,000.

The second method is that he's eliminating the property tax deduction for nearly all taxpayers for what is claimed to be a one-year period:

Property tax deduction

The average savings that would be lost from property tax deduction on state income taxes (based on tax returns for 2006, the latest available data)

At least $500,000 a year: $849. (39,500 tax returns)

$150,000 to $500,000: $525. (236,200 returns)

$80,000 to $150,000: $356. (469,300 returns)

$75,000 to $80,000: $268. (54,000 returns)

$70,000 to $75,000: $217. (57,300 returns)

$50,000 to $70,000: $175. (258,500 returns)

Note that anyone making between $75,000 and $150,000 is hit with the double whammy of losing both the homestead tax rebate and the homestead property tax reduction. For someone making $75,000, you'd be hit with a loss of more than $1,268 in the teeth of a recession. How exactly is that helpful to the very people who are needed to get us out of a recession? Recessions end because people feel comfortable spending more money; if they have less money because the government takes a vacuum cleaner to their wallets, they simply can't or wont spend what they don't have.

Also, the claim that the property tax deduction would be eliminated for just one year is laughable. The sales tax was increased from 6% to 7% with the intention that the revenues would be directed to property tax relief. That looks to be a complete farce, given how the state has slashed the property tax relief program significantly. Once the state sees revenues, they will not let that go unnoticed. It's what Trenton does. They aren't about to eliminate a revenue stream, particularly when the state has more spending in mind. Even those making less than $75,000 would see significant reductions in their property tax rebates - 30% less in fact.

This is yet another reason why the state is in such dire fiscal shape. It continues to treat taxpayers as piggy banks, and taxpayers simply don't have any more to give.