REPORT: StayNJ 2.0: Senior Tax Cut Still 2 Regressive and 2 Expensive
REPORT: StayNJ 2.0: Senior Tax Cut Still 2 Regressive and 2 Expensive
For Immediate Release
June 27, 2023 – The latest draft of StayNJ would still direct the largest tax cuts to already-wealthy seniors while providing much less to lower-income homeowners and renters, according to a new analysis of the bill by New Jersey Policy Perspective (NJPP).
The report, StayNJ 2.0: Senior Tax Cut Still 2 Regressive and 2 Expensive, finds that 28 percent of benefits would go to the top 20 percent of households, while those in the bottom 20 percent would receive only 7 percent of the benefits.
Even with an income cap of $500,000, a lower maximum tax credit, and a $250 benefit for renters, StayNJ still ties the total benefit to property taxes paid, resulting in the biggest tax cuts going to people with high incomes who own the most valuable homes.
The average benefit for seniors in the top 5 percent (with incomes of at least $360,000) would be $4,508, while seniors in the bottom 20 percent (with incomes less than $26,000) would receive an average benefit of $369. Because renters are disproportionately nonwhite and have lower incomes on average, the new StayNJ program would still widen the racial wealth gap in New Jersey.
“The new StayNJ proposal remains too regressive and too expensive, directing the biggest benefits to already-wealthy households,” writes Peter Chen, Senior Policy Analyst at NJPP and author of the report. “Whatever its good intentions, StayNJ will put more in the pockets of those who need it least, while doing little to support the low-income seniors most at risk of losing their homes.”
As written, the revised StayNJ proposal would make New Jersey’s tax code more regressive, all while costing the state an estimated $2.2 billion per year once fully implemented, according to the analysis.
