Economists: Daggett Tax Plan is Best


UPDATE The Chris Daggett Tax Plan Does Not Raise Taxes. Click Here to Read The Truth

The associated press had three economists review the tax plan of each of the NJ Gubernatorial Candidates. They found strengths and weaknesses in the tax plans from Independent Chris Daggett, Incumbent Democrat Gov. Jon Corzine, and Republican Chris Christie.

The three economists agree Daggett’s plan is the best course of action for easing NJ’s financial woes.

The Chris Daggett Tax Plan is the best for NJ Economy

The economists gave mixed reviews on the candidates Tax plans they said that while an ordinary sales tax might hit lower-income people harder, but Daggett’s approach would be shouldered by people with more money.

John H. Beck, an economics professor at Gonzaga University in Spokane, Wash., said Daggett’s tax plan makes sense because it doesn’t discourage people from earning money, investing, or saving. “Broadening the base for the sales tax is a good thing, as opposed to raising rates,” he said.

Beck said Daggett’s broad idea — using the additional revenue to reduce the state’s heavy reliance on property taxes, which pay mostly for local and county governments and public schools — is the best course.

Kim Rueben, a public finance economist at the Tax Policy Center, a nonpartisan think tank in Washington, said that if to many lobbyists get their businesses excluded the Daggett plan it could cause less revenues than expected, which is what recently happened in Maryland. Michigan however has had success implementing the plan.

Daggett’s mix of sales tax and property tax revenue is healthy. Property tax revenue does not fluctuate with the economy the way income and sales taxes do, and that helps local governments plan for the future.

Corzine’s plan relies to much on the Income tax

The economists say Corzine, a former Wall Street executive, has taken risks by putting too much of the burden for balancing the state budget on the well-off, a strategy the governor says was forced because of the national recession. They said Corzine’s plan puts to much burden on the well-off and these residents are the ones who can most easily leave the state and take their tax payments with them — whether they’re moving to a neighboring state like New York or Pennsylvania, or retiring to a far-off place like Florida.

Steven Frates, president of The Center for Government Analysis at Claremont McKenna College in Claremont, Calif.  said that Corzine’s plan relies to much on the Income tax and a bad year on wall street can lean to budget shortfalls.

Christie Tax Plan Would Create Huge budget Deficit

The economist agreed that Christie’s core promise is to cut taxes on businesses and income across the board and restore property tax rebates — though he says he’s not promising to do it in his first year in office —would likely stimulate the economy.

Christie’ core promise of reducing taxes would help the economy in multiple ways, including attracting or at least keeping businesses in the state.

Christie Tax Plan Isn’t Realistic

But Rueben worries that Christie’s plan isn’t realistic.

If Christie got to cut all the taxes that he wanted to cut, I don’t see how there is not a big budget deficit,” she said.

Christie wants to make those taxes based only on sales — so that firms are not penalized for investing in New Jersey.

Beck said that would help companies such as pharmaceutical firms that have a large portion of their operations but a small share of their sales here.

Christie Tax Plan Would Act Like Second Sales Tax

But he said it would be an unusual move and the Christie tax plan would have troubling consequence: By making it a one-factor levy, it would act like a second sales tax on goods that companies sell in the state.

Why NJ needs the Daggett Tax Reform

The report also pointed out that the state’s property tax bills average over $7,000, highest in the nation. And overall, the National Tax Foundation found that in 2007, the latest year for which data is available, New Jersey residents paid nearly 12 percent of their income to state and local governments — the highest burden in the nation.

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7 Responses

  1. […] But if you have been following my blog, you know this newspaper didn’t do its homework on Daggett’s plan because the Associated Press had 3 independent economists review each candidates plan and independent economists agree the Daggett tax plan is best […]

  2. You heard it yourself people.

  3. […] Independent Economists agree Economists: Daggett Tax Plan is Best […]

  4. […] Economists: Daggett Tax Plan is Best « NJ Election 2009 – Chris Daggett and Election Candidates njelection.wordpress.com/2009/10/23/economists-daggett-tax-plan-is-best – view page – cached The associated press had three economists review the tax plan of each of the NJ Gubernatorial Candidates. They found strengths and weaknesses in the tax plans from Independent Chris Daggett,… (Read more)The associated press had three economists review the tax plan of each of the NJ Gubernatorial Candidates. They found strengths and weaknesses in the tax plans from Independent Chris Daggett, Incumbent Democrat Gov. Jon Corzine, and Republican Chris Christie. (Read less) — From the page […]

  5. Social comments and analytics for this post…

    This post was mentioned on Twitter by randeazie: RT @alexhiggins732 @JerzeeGuy RT @randeazie AP: Independent Economists agree Dagget’s plan is best http://wp.me/pAt3G-5A #njgov…

  6. […] The associated press hired 3 independent economists to review the tax plan of Chris Christie, John Corzine and Chris Daggett and economists agree economists agree the Daggett Tax plan is the best. […]

  7. […] The associated press hired 3 independent economists to review the tax plan of Chris Christie, John Corzine and Chris Daggett and economists agree economists agree the Daggett Tax plan is the best. […]

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