New Jersey Governor Chris Christie, the Republican who has sought to roll back taxes, battled with public employee unions and was courted to run for president, can’t shake one distinction: His state again ranks last in business climate.
The Washington-based Tax Foundation, which advocates for simpler tax codes with lower rates, today released its annual Business Tax Climate Index, which ranks the 50 U.S. states based on how welcoming their tax law is to businesses. New Jersey ranked 50th, a position it also held in 2011.
Christie’s state has the third-worst individual income tax, the fifth-worst sales tax, the 13th-worst corporate tax and the second-worst property tax, the foundation said. The governor, who took office in January 2010, said the ranking doesn’t account for the 10 percent income-tax cut he proposed this month or earlier moves to slash business taxes by $200 million and cap property-tax growth at 2 percent a year.
“When that income-tax cut comes in, I’m willing to bet you that we won’t be 50th again next time,” Christie told reporters today in Trenton.
The index represents the tax climate as of July 1, the first day of the fiscal year for most states. The second-worst state was Christie’s northerly neighbor, New York, run by Democrat Andrew Cuomo. Wyoming, which has no corporate or individual income tax, has the best business climate.
Illinois’s ranking plunged to 28th from 16th, after the state last year raised its personal tax rate to 5 percent from 3 percent, and its corporate rate to 9.5 percent from 7.3 percent, according to the foundation.
New Jersey’s ranking shows that Democratic lawmakers’ push to raise income taxes on residents earning $1 million or more would harm the state’s economy and make it less competitive, Christie said. Democrats, who control both houses of the Legislature, have said Christie’s tax cut would favor the wealthy.
“This report is even more proof that we need to institute the income tax cut; that we need to institute the rest of the business-tax cuts that I laid out last year; and that we have to continue through shared services and other efforts to make sure our property taxes continue to move down,” Christie said.
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