Trio of tax cuts are proposed to offset gas tax hike.
‘No Estate Tax Without Gas Tax Increase,’ Senate Assembly Speaker Says
business owners had finally gotten some good news when the Senate Budget and
Appropriations Committee approved S1728, a bill that would phase out the estate
tax over five years. However, last month, State Assembly Speaker Vincent Prieto
made it clear the estate tax proposal is a bargaining chip in the gas tax
reported on Speaker Prieto’s comments at a Statehouse news conference, in which
he said he would be open to phasing out the estate tax or increasing the
exemption on the tax, but only if the tax cut is part of a deal on funding the
Transportation Trust Fund, which will run out of money this summer. Speaker
Prieto said he won’t bring S1728 up for a vote without a TTF deal.
Christie supports abolishing the estate tax and has been vocal about the need
for tax fairness if he is to consider any increase to the gas tax. One option
on the table is a plan from Sen. Paul Sarlo. A gas tax increase would be offset
by phasing out the estate tax over five years, raising the tax exemption on
retirement and pension income, and implementing a tax deduction for charitable
donations. The specific gas tax amount has not been discussed yet, but Sen.
Sarlo’s plan would increase the TTF to $2 billion annually from $1.6 billion.
components of Sen. Sarlo’s plan are bills that have already passed committee
(S1728 and S998), but Speaker Prieto will not call them individually for votes
and plans to treat them as a package deal in exchange for transportation
S1728, the estate tax exemption threshold would increase to $1 million (from
$675,000) on Jan. 1, 2017; to $2.5 million in 2018; to $3.5 million in 2019;
and to $5 million in 2020. On Jan. 1, 2021, the estate tax would be eliminated.
S998 would increase the tax threshold on retirement and pension income—from
$20,000 to $100,000 over three years for married couples filing jointly, and
from $15,000 to $75,000 for individuals.