Candidate Christie Continues His Shift to the Right, Taking Anti-Tax Pledge

But Gov. Christie may soon face dilemma as gas-tax hike may be only way to replenish New Jersey’s shaky Transportation Trust Fund

tax pledge
Still behind in the polls and struggling to find a way to stand out among a crowded field of GOP presidential contenders, Gov. Chris Christie has signed a national anti-tax group’s pledge to always oppose tax hikes.

Though he has strongly criticized Democratic opponents for backing tax increases, it’s a formal step Christie, a second-term Republican, never took while running for governor in 2009 and 2013.

Taking the pledge marks another move to the right for Christie, who has also hardened his positions on immigration, national Common Core standards and gun-ownership rights this year as he’s decided to seek the GOP nomination.

The decision also draws more attention to his own mixed and complicated gubernatorial record on the tax issue, and it comes as Christie is running out of time to figure what to do about the state’s shaky Transportation Trust Fund, leaving few if any alternatives but agreeing with Democrats who control the Legislature to raise New Jersey’s gas tax.

In an announcement released yesterday, Americans for Tax Reform’s President Grover Norquist credited Christie with vetoing “more tax hikes than any other governor in modern American history.”

“And he made those vetoes stick,” Norquist said. “Without the Christie governorship, New Jersey would be somewhere between Detroit and Greece.”

Yet for Christie, the tax issue is more complicated than just highlighting his record of rejecting a series of bills sponsored by Democrats that would have raised taxes.

Though the state’s income, sales and corporate tax rates have not been changed during Christie’s tenure, many New Jersey homeowners are paying higher net property tax bills as a result of Christie’s decision in 2010 to slash funding for the state’s Homestead property tax relief program.

Also in 2010, Christie reduced the size of the state’s Earned Income Tax Credit, a policy change that resulted in a slight net tax increase for the state’s lowest-income workers. Earlier this year, Christie and lawmakers agreed to reverse that cut and also slightly increased the credit, something he has now promoted as a tax cut.

Last year’s state budget also increased more than two dozen fees and fines levied by the state. And Christie declined in 2011 to use gubernatorial veto authority to block toll and fare hikes that were approved by the Port Authority, resulting in increases that have hit some commuting families harder than any state tax hike would have.

Even yesterday’s initial statement from Americans for Tax Reform required some clarification. The organization credited the governor with rejecting Democratic attempts to enact a higher corporate-tax rate and to increase the state’s 8.97 percent top-end income tax bracket, which kicks in on earnings over $500,000. The statement said Democrats sought those increases “in each of the five budgets sent to Christie.”

But the income-tax bills sponsored by the Democrats sought to create an altogether new top-end income tax rate for earnings over $1 million, which would have left the current 8.97 percent rate in place for earnings between $500,001 and $1 million. And the Democrats’ proposed corporate-tax increases only in the last two state budgets they sent to the governor, and only in response to his decision to slash contributions into the chronically underfunded public-employee pension system.

A spokesman for the Washington, D.C.-based organization promised to take another look at the claims made in the announcement yesterday, and it was changed later in the day.

Christie’s anti-tax pledge, meanwhile, would seem to conflict with the huge transportation-funding problem he will have to face by the time the current fiscal year ends on June 30, 2016. That’s when the funding plan for the state’s Transportation Trust Fund, which pays for more than $3 billion in annual road, bridge and rail improvements in New Jersey thanks to both state and federal matching money, is set to expire.

[related]After the fiscal year ends, the fund’s primary source of state revenue, New Jersey’s 14.5-cent gas tax, will only generate enough money to pay down existing debt. There will also be no funds available for more investment in mass transit, including expanding light rail into Bergen and Gloucester counties and contributing toward Amtrak’s planned Gateway Hudson tunnel project.

Christie has yet to say what he will do to renew the trust fund, but governors have traditionally waited until just a few months before reauthorization is necessary to lay out the next funding plan.

Still, Christie has been saying for much of the past year, when asked about a potential gas-tax hike, that “everything is on the table.” Though Christie’s office declined comment on the issue yesterday, referring questions instead to his presidential-campaign staff, there’s no indication that his position has now changed.

But hiking New Jersey’s gas tax as governor, if he ultimately chooses to do so, would seem to fall outside of his new anti-tax commitment. That’s because the pledge he signed is a specific promise to national voters that he won’t increase their tax burden if he becomes president.

“It is a written commitment to the American people that if elected to the White House, he will ‘oppose and veto any and all efforts to increase taxes,’” explained John Kartch, the vice president of communications for Americans for Tax Reform.

Christie would also appear to have even more wiggle room because the pledge protects against any “net tax increases.”

That would leave open the possibility that, as has been discussed with lawmakers, he could trade a gas-tax hike that funds transportation needs for a corresponding reduction in some other tax. For example, New Jersey’s estate and inheritance taxes have long been on the Republicans’ wish list for reform since they apply to both someone’s estate upon death as well as to the person, depending on their relation, who receives an inheritance.

Kartch said such a “revenue neutral” solution would comply with the organization’s focus on the net tax burden.
“Raising one tax while lowering another, the effect being revenue neutral, is fine,” Kartch said.

He added: “At any rate, taxpayers are certainly not worried about Christie signing a tax hike now or in the future.”

John Currie, chairman of the New Jersey Democratic State Committee, warned that Christie’s taxpayer-protection pledge “isn’t worth the paper it’s printed on.”

“It is just a symbol of his desperation, short-sightedness and hypocrisy,” Currie said. “Christie left the
Transportation Trust Fund high and dry, underfunded our public pension system, and allowed our credit rating to plummet, to mention just a few of his policy failures.”

“He should really pledge to resign, so we can find a more responsible and responsive governor — one who will not put conservative and corporate interests ahead of his constituents’ needs,” he said.

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