As New Jersey braces for the full impact of reduced federal funding for social services, the state is taxing private employers that have a large number of workers receiving Medicaid benefits.
The levy, for as much as $725 per employee, and went into effect this month after winning approval from Gov. Mikie Sherrill and fellow Democrats who control the state Legislature.
The proposal for what’s officially labeled a “fee” in state tax law was one of several fiscal policies enacted while state government’s annual budget was under negotiation late last month in Trenton.
Taken together, a package of tax changes that included the Medicaid fee is expected to generate hundreds of millions of dollars in new revenue as the state budget has expanded to nearly $61 billion, a record high.
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