Causes
Corzine, in attempting to pass his conceptual budget, came into conflict with fellow state Democrats in the New Jersey General Assembly, particularly over their refusal to implement his proposed increase of the state's sales tax from 6% to 7% to fill a $4.5 billion budget gap. Corzine maintained that the gap could not be filled by any other means due to the state's constitution and a ruling of New Jersey's Supreme Court. Long before the deadline date, Corzine had stated that he would not accept a budget that did not include a sales tax increase. Due to Corzine's insistence, the state's General Assembly, which was dominated by Democrats, refused to pass a budget before the deadline.
Read more about this topic: 2006 New Jersey State Government Shutdown