Call for Implementation of State Comptroller’s Tax Incentive Audit Recommendations
Senator Anthony Bucco and Senator Steven Oroho said New Jersey’s extremely high business tax burden and lax oversight of tax incentive programs have created an environment for the kinds of abuses that were identified in an audit released this week by the State Comptroller. Further, they called for the implementation of the recommendations offered by the Comptroller to address the deficiencies that were found in the State’s tax incentive programs.
Sen. Anthony Bucco and Sen. Steven Oroho said New Jersey’s extremely high business tax burden and lax oversight of tax incentive programs has created an environment for the kinds of abuses identified in an audit by the State Comptroller. (SenateNJ.com)
“With some of the highest business taxes in the nation, New Jersey provides a significant incentive for corporations to try to claim tax breaks they may not deserve,” said Bucco. “While that’s clearly wrong, it’s also incumbent upon the EDA as the organization that oversees tax incentive awards to ensure that tax credits aren’t claimed improperly. Stricter oversight of these programs is more important than ever following the imposition of $1 billion in new business tax surcharges by Governor Murphy last year.”
The Comptroller’s report highlighted a number of deficiencies at the New Jersey Economic Development Authority (EDA), the agency responsible for managing the State’s various business tax incentive programs.
The Comptroller found “inadequate monitoring, insufficient oversight, and non-existent policies and procedures that created control deficiencies that weaken the transparency and accountability of the incentive programs and their success.”
As a result, businesses were able to claim tax credits for the creation or retention thousands of jobs that were not actually created or retained according to the terms of the tax incentives they were awarded by EDA.
The Comptroller further noted that the EDA “disagreed with some of our findings and recommendations,” while adding that the EDA, “failed to provide any compelling evidence warranting a change to the audit conclusions.”
“While I believe the best tax incentive program would be a competitive tax structure and lower taxes across the board for everyone, that clearly is not what Governor Murphy proposes,” added Oroho. “As long as the Administration keeps driving taxes higher, New Jersey’s incentive programs are an unfortunate necessity to protect jobs and economic growth. With that in mind, I believe we should implement the recommendations of the Comptroller’s audit to force the EDA to perform the oversight and compliance work that is required for our tax incentive programs to operate efficiently and effectively.”
Governor Phil Murphy signed tax increases totaling $1.5 billion as part of the FY 2019 state budget, cementing New Jersey last-place ranking in the Tax Foundation’s 2019 State Business Tax Climate Index.
Related Facebook Post: