Economists question lawmakers’ plans to address inflation

July 19, 2022

As consumers nationwide grapple with increases in the cost of rent, gas, and groceries, New Jersey lawmakers have offered a slew of plans they say will address skyrocketing inflation.

Sales tax holidays on certain items, moratoriums on toll increases, and a revamp of income tax brackets are just some of the ideas floated to ease the pain of the largest jumps in consumer prices seen in 40 years.

But economists say there is little state officials can do to combat the cost of goods, a problem they said is really in the hands of the federal government. And while some tax holidays might help put a little more money back in the wallets of consumers, the state will have to find some way to pay for the projects and services that tax revenue is intended for, they said. 

“Everything should be under consideration, but each one should be carefully analyzed on really the cost and benefit of each because in many cases, it’s a trade-off,” said James Hughes, an economist at Rutgers University. 

New Jersey Monitor, July 18, 2022

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