October 14, 2016

Christie signs controversial N.J. gas tax hike into law

Effective Nov. 1, residents will pay rate of 37.5 cents per gallon

New Jersey Gov. Chris Christie officially signed into law on Friday the controversial tax plan that raises the state's gasoline tax by 23 cents per gallon in order to fund transportation and infrastructure investments.

After a grueling legislative process that lasted seven months, New Jersey residents will see the tax take effect Nov. 1, raising their rates at the pump from 14.5 cents per gallon to 37.5 cents per gallon. The jump moves the state from the second lowest gas tax in the United States to the seventh highest.

Revenue from the tax will support New Jersey's insolvent Transportation Trust Fund. The bill also cuts three-eighths of a cent from New Jersey's seven percent sales tax, eliminates the estate tax and repeals a three-month freeze on work financed by the Transportation Trust Fund.

“Through this legislation, we are continuing our commitment to providing tax relief for working New Jerseyans of all income levels, senior citizens, military veterans and property owners, while ensuring solid, reliable, state-of-the-art roads, bridges and mass transit systems,” Christie said in a statement. “Over the next eight years, a record $32 billion in state and federal funds will be invested in infrastructure improvements and modernizations in New Jersey. This compromise legislation locks in what I called for from the beginning: tax fairness for all residents, leading to a more affordable state and an improved economy.”

Critics of the bill reacted immediately, expressing disapproval and doubling down on plans to initiate a repeal.

“Defying the will of so many people on such an important affordability issue will not help us to change the perception shared by too many residents that they are being taxed out of New Jersey," said Sen. Jennifer Beck (R-Monmouth). “New Jersey is a commuter state, and this billion dollar tax increase will be a crushing blow to the many middle-class commuters who are already struggling to afford the costs of getting to work every day.”

Sen. Kip Bateman (R-Somerset) said he plans to introduce legislation to repeal the bill the next time the Senate meets.

“The overtaxed people of New Jersey have demanded that we find another way to fund our transportation needs without taking more out of their pockets," Bateman said. "This repeal effort is recognition that there are fiscally responsible alternatives to the gas tax.”

New Jersey Assembly Speaker Vincent Prieto (D-Hudson/Bergen) acknowledged it's been a "difficult process" but said the bill was an important step forward.

"With this new law, we've ensured a stronger New Jersey and a safer New Jersey, put laborers back to work and taken a major step toward finally bringing our state a 21st-century infrastructure," Prieto said. "In the end, this will be seen as a pivotal moment, one that laid the groundwork for a better future."