New Jersey State House by Peter Miller licensed under CC BY 2.0

On June 30, 2025, Governor Murphy of New Jersey signed the 2026 budget – the largest in New Jersey history. Residents have to question what they are getting for all this spending.  

Spending through 2026 is expected to surpass $58 billion. The budget includes numerous big-ticket items, including $4.3 billion in property tax relief, $12.1 billion in K-12 school aid, and a $7.2 billion payment to the state’s public pension fund.  

While spending in areas such as property tax relief is attempting – with the wrong tool – to address a real problem, this kind of spending is simply unsustainable. It is especially unsustainable since the state is raising taxes and running a deficit at the same time in order to fuel it.  

Starting in 2026, there will be an increase in taxes on online gambling and sports betting, an increase in the realty transfer fee, an increase in taxes on nicotine products, and a new 2.5% corporate transit fee.  

New Jersey was a leader on good sports betting tax policy, keeping taxes reasonable and regulations in check. The state reaped the rewards of that good policy with economic growth and tax receipts that exceeded expectations. Rather than accept the success of the policy, Democrat leaders unfortunately lived up to President Reagan’s timeless quote, “if it moves, tax it.”  

Despite all of the tax hikes, the New Jersey government is still expecting to spend $1.2 billion more than it brings in. This level of fiscal irresponsibility is simply unacceptable.  

New Jersey ran a budget surplus from fiscal year 2018 through 2021. New Jersey ran structural budget surpluses ranging from $78 million to $310 million. Governor Murphy championed billions of dollars in tax increases. This is a perfect lesson that government has a spending problem, not a taxing problem. Despite the surpluses, and massive tax hikes, the state has spent its way into a fiscal mess. Their only idea: tax our way out of it.   

Under Murphy, the state has run up significant deficits since 2022. That year, the state was expected to spend almost $4 billion more than it brought in, and the structural deficit has remained at more than $1 billion for four of the past five years. During that same time, New Jersey’s budget surplus fund has shrunken from a peak of over $9 billion to $6.3 billion after the 2026 budget cycle.  

New Jerseyans deserve better than an administration that will spend away its own savings account, while at the same time taking more and more from its citizens’ bank accounts. The 4% increase in budget from last year is significant and part of a huge increase in spending that has inflated the budget during Governor Murphy’s tenure.  

The budget in the fiscal year of 2018, at the start of his governorship, was $34.7 billion, and the current budget is now $58 billion, representing a 67% increase in just 8 years.   

That increase hasn’t come cheap for New Jersey. Despite already having the 4th-highest top marginal income tax rate in the country, New Jersey just can’t stop raising taxes. Its corporate tax rate was also already the 4th highest in the country in 2024, but with the additional corporate use fee, it too becomes the highest in the country, and it isn’t the first time New Jersey has raised its corporate tax rate. The rate was 11.5% from 2021 through 2023, and the state government still ran a deficit. All of these burdensome taxes have led to the state being ranked just 30th in business and 49th in business friendliness.  

The math isn’t ‘mathing’ in Trenton because the Democrats in control are wasting incredible amounts of taxpayer dollars.