Businesses that hire a contractor who is not registered with the NJ Division of Revenue will have to withhold part of their payments to cover the cost of that contractor’s payroll taxes, under legislation, S-468 (Sweeney)/A-1910 (Burzichelli, Voss), signed into law (P.L. 2006, ch.85) August 21 by Governor Jon Corzine. The new law requires employers to withhold 7 percent of the total amount paid to the contractor and forward it monthly to the NJ Department of Treasury. The law applies to payments made on or after January 1, 2007.
Businesses will be responsible for verifying a construction contractor’s tax registration. They also must provide a written annual statement to each contractor detailing the total payments made on his or her behalf. Businesses that fail to withhold the taxes will be subject to the same penalties they would receive if they failed to pay payroll taxes for their own employees.
NJBIA opposed enactment of this bill. The business of collecting these taxes belongs to the NJ Division of Taxation, not the hardworking employers of New Jersey. This law imposes an inefficient and costly mandate on New Jersey businesses and unfairly shifts the burden of tax compliance onto them. Employers now will have to establish costly monitoring and tracking systems to comply or face unfair penalties. For more information, contact Art Maurice at ext. 247.
Governor Signs Prescription-Drug-Price Database Bill—Some time in the fall of 2007, consumers will have an easier time comparing prices on their prescription drugs under a new, State-run drug-price database, thanks to a new law (P.L. 2006 ch.84) enacted August 21. Governor Jon Corzine signed ACS-2537 (Greenstein, Conaway, Johnson, Diegnan)/ S-1396 (Buono, Vitale), establishing the “New Jersey Prescription Drug Retail Price Registry.” The registry will list the retail prices various pharmacies charge for the 150 most frequently prescribed drugs. The list will be updated weekly and the information organized so consumers can compare prices among pharmacies located within a particular zip code.
NJBIA supports creation of a drug-price registry. Giving consumers greater access to information about the cost of healthcare is part of NJBIA's health insurance reform agenda. If consumers are empowered to shop around for the best healthcare value, they will be able to save money on prescription purchases and keep their out-of-pocket expenses down. Reducing prescription drug costs also eases the pressure on premium increases for employers who provide health insurance to their employees.
The exploding cost of health insurance is the biggest problem facing NJBIA member companies. With more than 5 million New Jersey residents receiving their health benefits from private-sector employers, this effort to help consumers lower their prescription drug costs could help constrain health insurance inflation. For more information, contact Christine Stearns at ext. 260.
Health Benefits Reporting Bill Becomes Law—Governor Jon Corzine on August 21 signed S-539 (Buono, Coniglio)/A-932 (Gusciora, Van Drew), to track companies that have 50 or more employees who receive State-funded healthcare. NJBIA opposed the bill because it is nothing more than an effort to harass business and bolster support for a healthcare tax.
Under the new law (P.L. 2006, ch.87), the NJ Department of Health and Human Services (DHSS) will report which companies have 50 or more employees who are enrolled in Medicaid and/or FamilyCare, the State’s subsidized health insurance program for low-income working families, or who receive hospital-based charity care. The report will be due every September 1.
Some legislators have criticized businesses for not providing generous enough benefits, noting that some enrollees choose the government program over the health benefits offered by their employer. These legislators have concluded that businesses should be forced to pay more for health benefits or face a healthcare tax. This would punish companies that provide health benefits for decisions that are made by their employees. The healthcare tax bill, S-477 (Sweeney, Vitale), is awaiting action in the Senate Budget and Appropriations Committee.
The new law ignores the fact that the cost of health insurance is rising at three times the rate of inflation. Instead of bashing businesses that are struggling to keep up with out-of-control health insurance costs, legislators should take up the hard work of reforming New Jersey’s health insurance system to make it more affordable. For more information, contact Christine Stearns at ext. 260.
Senate President Codey, Assembly Speaker Roberts on Sept. 27—Hear directly from New Jersey's two most powerful legislative leaders, Senate President Richard J. Codey and Assembly Speaker Joseph Roberts, at a special NJBIA breakfast briefing, Meet NJ's Top Two Legislative Leaders, which will be held on Wednesday, September 27, at the Forsgate Country Club in Monroe Township (just off exit 8A of the NJ Turnpike) from 7:30 a.m. until 10:00 a.m. Plenty of time will be set aside to answer your questions. Don't miss this informative networking event. The cost is $69 per person for NJBIA members and $105 for nonmembers. For additional information contact Katie Wittkamp at 609-393-7707, ext. 239, or register online. To become a high-profile sponsor, contact Sherry Esteves at ext. 219.
Raise Your Visibility. Become an Event Sponsor—The Awards for Excellence Dinner. NJBIA's Public Policy Forum. First-rate seminars. Events like these offer companies an excellent opportunity to reach their target audiences and heighten their visibility by sponsoring NJBIA events. Don’t miss out. Learn more about becoming an NJBIA sponsor by contacting Sherry Esteves at 609-393-7707, ext. 219.
We also encourage you to register for our October 17 Awards for Excellence Dinner and our October 25 Hot Legal Topics for Employers seminar. |
