As lawmakers consider the Murphy administration’s budget proposal, they now have new numbers on the state’s revenue picture. Revenue collections in August dropped 5.7%. For the past two months, revenue collections totaled $2.14 billion, down nearly 15% from the same period last year. Year-to-date income tax and corporate business tax collections are both down more than 30%, but sales tax collections rose.
New Jersey businesses may need to brace themselves for a higher payroll tax next year. The payroll tax helps support New Jersey’s unemployment trust fund, which is used to pay out claims for jobless workers. Given the high level of unemployment, the trust fund has been exhausted. Officials are hoping for additional federal relief money for the trust fund.
Help for the economy came Wednesday from the Federal Reserve, which indicated it plans to keep interest rates at very low levels for the next few years as a way to support the economic recovery. The Federal Reserve stated that the ongoing pandemic poses considerable risks to the economic outlook over the medium term.