Christie weighs New Jersey, Pennsylvania taxpayers’ fate

Jeff Sheridan, press secretary to Pennsylvania Governor Tom Wolf, said Christie “erred significantly in his decision to unnecessarily punish 125,000 Pennsylvanians and cost the commonwealth $5 million annually”. Democratic New Jersey Assembly Speaker Vincent Prieto said Christie shouldn’t blame the Legislature for his failure to cut $250 million.

If the agreement ends, the tax consequences would hurt high-earning Pennsylvanians who work in New Jersey and low-income New Jerseyans who work in Pennsylvania. Pennsylvania is losing $35 million under the agreement, he said. “Under his leadership, the department has implemented multiple initiatives that have expanded the educational opportunities for children in struggling urban districts, improved the professional supports available for educators, delivered relief from burdensome regulations weighing on districts and has successfully entrenched New Jersey as a national leader in the use of technology in the classroom”.

The president of the state’s biggest teachers union, which clashed with the Republican Christie administration over the tests, said that despite disagreements with Hespe on policy that he was always accessible and willing to listen.

By way of explanation, Pennsylvania and New Jersey lawmakers and Tax Foundation state director Scott Drenkard provided these scenarios: A Pennsylvania resident who works in New Jersey and makes over $40,000 files a return in Pennsylvania, pays her taxes, then files a return with New Jersey.

In a statement, Christie said New Jersey’s Democratic-controlled Legislature forced his hand.

New Jersey and Pennsylvania have had a tax reciprocity agreement in place since 1977. A highly paid executive living in Pennsylvania but working in New Jersey now can pay Pennsylvania’s 3.07 percent flat tax.

In June, when he enacted New Jersey’s 2017 state budget, Christie directed his Treasury Department to study whether to dissolve a reciprocal income-tax agreement with Pennsylvania under which cross-border commuters pay taxes to the state where they live rather than work.

“Balancing New Jersey’s books on the backs of hardworking Pennsylvanians is unfair and uncalled for”, Santarsiero said.

“New Jersey’s losses from not being able to tax wealthy Bucks County residents who commute to high-paying jobs in New Jersey far outweighs the taxes New Jersey collects on low- and moderate-income Camden and Gloucester County residents who work in Pennsylvania, typically Philadelphia”, he wrote. It will be a blow to residents who are trying to make ends meet. “This is not the last word on this issue”.

It’s not the first time a New Jersey governor has considered ending the deal.

“This is absolutely a money grab”, he said.

The Christie administration did not provide estimates on how much the state would gain in tax revenue.