The U.S. News & World Report recently published its rankings of the best states, with New Jersey being named the 14th best state overall. However, when it comes to fiscal stability, an important factor for the state's business environment, New Jersey ranked 48th. This follows a CNBC study from last year that placed New Jersey at 19th overall on its "Top States for Business" list but also highlighted significant shortcomings, ranking it 44th in cost-effectiveness and 48th in business-friendliness.
Tom Bracken, president and CEO of the New Jersey Chamber of Commerce, expressed concerns about these rankings and their implications for New Jersey's economic conditions and long-term fiscal health. He questioned what actions government leaders could take to address these issues.
Bracken suggested avoiding policies that would worsen the weaknesses identified in these surveys. "We can start by not exacerbating the weaknesses highlighted in these surveys, which would occur if we raise business taxes, such as the Corporate Transit Fee (CTF) proposed in Governor Murphy’s fiscal 2025 state budget," he said. He emphasized that increasing taxes could deter future investments by companies and hinder economic growth over time.
Additionally, Bracken criticized the CTF and a proposed 'buck-a-truck' tax on trucks delivering goods to warehouses in the state. He argued that these measures "would reverse the progress New Jersey has been making as a business-friendly state" by making it more expensive and less competitive.
Bracken mentioned ongoing discussions between his chamber's lobbying team and legislative leaders, as well as members of Governor Murphy's administration. They have been cautioning them about the potential impact of tax hikes and reminding them of recent warnings from credit agencies following credit rating upgrades.
Credit agencies have advised that maintaining current ratings requires finding "long-term, stable, organic sources of revenue." According to Bracken, this can be achieved by fostering a healthy business climate: “Develop and nurture a healthy, growing state business climate,” he said. “That’s how New Jersey will flourish and pay for the state programs that helps make it a great place to work and to live.”
Bracken concluded by stating that current budget proposals exacerbate negative aspects highlighted in various rankings and do not offer meaningful support to struggling businesses. He believes there is no reason why New Jersey cannot become a top 10 state for doing business with a strong business climate free from excessive taxation and regulation.
