Christie Saves NJ/PA Income Tax Reciprocity

New Jersey Governor Chris Christie has reversed course on ending the income tax reciprocity agreement between the state and Pennsylvania after closing the budget gap that would have necessitated ending the agreement.

Currently, taxpayers who work in NJ but live in PA or live in NJ but work in PA pay taxes where they live.  Had the agreement ended as planned, these workers would have had to pay income taxes in both states.

…Christie said legislation passed on Monday, along with changes previously agreed to by the state Health Benefits Commission and Plan Design Committee, would fill the gap and made it unnecessary for him to kill the agreement.

He said in a statement that the legislation “will save State taxpayers hundreds of millions of dollars in health care benefit costs” and that he’s “proud my administration was again able to work with elected officials from both sides of the aisle and many labor union representatives to achieve these savings.”

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Senate president Stephen Sweeney on Tuesday thanked Christie for his cooperation and credited lawmakers for keeping the pressure on him.

“This is an enormous win for people who live in New Jersey,” he said at a press conference in Gloucester County. “We are very excited to get this done.”