Legislature Approves FY 2016 State Budget and Governor Takes Action on Budget and Spending Bills

In a marathon voting session that lasted into the evening, the General Assembly voted 47-31 and the Senate voted 24-16 to approve a $35.3 billion FY 2016 budget, sending it to Governor Chris Christie for consideration. The approved budget is $1.8 billion more than the budget proposed by the administration, and includes a $3.1 billion payment into the pension system as well as increased funding in several areas. The increased spending is paid for by a “millionaire’s tax,” which adds to the Gross Income Tax a new 10.75 percent tax rate on income over a million dollars as well as a 15% surtax on tax liabilities under the Corporate Business Tax.

 

As anticipated, Governor Christie on Friday approved the budget, while using his line-item-veto authority to slash $1.6 billion from the Legislature’s budget and vetoed the increases to the Corporate Business Tax and Gross Income Tax. Additionally, Christie is returning to the Legislature a bill which would increase the Earned Income Tax Credit (EITC) by fifty percent to achieve parity with the EITC in New York State.