On April 10, the House passed the identical budget framework that the Senate adopted the previous week which lays the framework to adopt a bill that includes changes to tax policy, including extending taxes that are scheduled to expire at the end of 2025; deficit reduction; border security; military spending; energy policy as well as other priorities.
The League is advocating for a significant increase to the State and Local Tax Deduction (SALT) in this legislation, which has been capped at $10,000 since the enactment of the Tax Cuts and Jobs Act.
However, the League is concerned that one of the ways priorities will be funded in this bill is by ending the tax exemption of municipal bonds. Proposals to eliminate or reduce the tax exemption for municipal bonds would significantly increase borrowing costs for local governments, forcing difficult budget decisions and limiting our ability to invest in vital public projects. We encourage you to adopt the sample resolution in support of preserving the tax exemption for municipal bonds.
If you are unsure if your municipality has utilized tax-exempt municipal bonds over the past decades, the University of Chicago Center for Municipal Finance has a breakdown by congressional district. After clicking the link, scroll down to New Jersey and select the district where you live to review their analysis.
Contact: Paul Penna, Director of Government Affairs, ppenna@njlm.org, 609-695-3481, x110.