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The Boss
THE HIGHEST TAXED CITY

By David Dayton McKean
This Web version, edited by GET NJ, COPYRIGHT 2003

The financial future of Jersey City and Hudson County is alarming. The burden of taxes is now great enough to bankrupt home-owners and landlords and to drive out any industry that is able to move. There is no immediate prospect of any reduction in the payroll costs; on the contrary, if the history of the organization means anything, costs will increase. Even if by some miracle the payroll could be purged and salaries reduced, the liquidation of the accumulated debt plus the maintenance of normal governmental functions would keep taxes high for many years to come. Failing a fiscal miracle the organization must seek additional income. More money cannot be obtained by borrowing, for the debt limit is dangerously close. The tax burden is admittedly confiscatory, and rates and assessments cannot be pushed much higher. There have been hints that City Hall is considering new taxes, but so far no satisfactory one has been discovered. A city retail sales tax would not bring in much income, both because Jersey City is not a retailing center and because, with the proximity of New York, such a tax could easily be evaded. A manufacturers' sales tax would be another inducement for industries to leave. Mayor Hague has always opposed an income tax on principle, but even if he did not, the incomes of most of the residents, who are chiefly unskilled and semi-skilled. are so low that an income tax upon them would not pay for its collection. A rent tax is a serious possibility: it might have been imposed before this except for the danger that many residents could move to other cities only a few minutes away. Any general exodus would produce a wave of bankruptcies which in turn would bankrupt the city and the county. But a rent tax might be levied with low rates at the beginning in the hope that people would not find it worth while to move.

There seems to be no way out. From a financially sound community in 1917 the Hague machine has brought Jersey City and Hudson County to the verge of collapse. It has absorbed as much of the income and the capital of the inhabitants as legal forms and economic considerations would permit, and only federal subventions have postponed bankruptcy.

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