FISCAL NOTE
SENATE, No. 3513
STATE OF NEW JERSEY
221st LEGISLATURE
DATED: JULY 3, 2024
SUMMARY
Synopsis: Imposes 2.5 percent corporate transit fee on taxpayers with allocated
taxable net income in excess of $10 million under CBT.
Type of Impact: Increase in State revenue collections from FY 2025 through FY 2029
Agency Affected: Department of the Treasury
Executive Estimate
Fiscal Impact FY 2025 FY 2026 FY 2027
State Revenue Gain $1.023 Billion $859 Million NA
Office of Legislative Services Estimate
Fiscal Impact FY 2025 FY 2026 FY 2027
State Revenue Gain $1.024 Billion $815 Million $851 Million
 The Office of Legislative Services (OLS) largely agrees with the Executive assessment of the
revenue gain associated with the enactment of the five-year corporate transit fee. The two
estimates differ slightly, however, reflecting general forecasting uncertainty.
BILL DESCRIPTION
This bill imposes a 2.5 percent surtax, to be called the “Corporate Transit Fee,” on corporation
business taxpayers that have New Jersey allocated taxable net incomes in excess of $10 million
for tax years 2024 through 2028. The additional revenue is intended to support general State
purposes in FY 2025 and New Jersey Transit Corporation operating expenses from FY 2026
through FY 2029.
Taxpayers are not allowed to claim credits against the corporate transit fee, except for credits
for installment payments, estimated payments made with a request for an extension of time for
filing a return, or overpayments from prior tax years.
Office of Legislative Services Legislative Budget and Finance Office
State House Annex Phone (609) 847-3105
P.O. Box 068 Fax (609) 777-2442
Trenton, New Jersey 08625 www.njleg.state.nj.us
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FISCAL ANALYSIS
EXECUTIVE BRANCH
The Executive has not submitted a formal, written fiscal note on this bill. However, the
Executive indicated in the FY 2025 Budget in Brief that the corporate transit fee would increase
State revenue collections by $1.023 billion in FY 2025 and $859 million in FY 2026. The
Executive did not revise its FY 2025 corporate transit fee estimate in its May 2024 revenue update.
OFFICE OF LEGISLATIVE SERVICES
The OLS largely agrees with the Executive assessment of the revenue gain associated with the
enactment of the five-year corporate transit fee. The two estimates differ slightly on account of
general forecasting uncertainty.
Specifically, the OLS projects that the five-year corporate transit fee will increase State
revenue collections from corporation business taxpayers with allocated taxable net incomes in
excess of $10.0 million by $1.024 billion in FY 2025, $815 million in FY 2026, $851 million in
FY 2027, $887 million in FY 2028, and $537 million in FY 2029. The projections assume an
annual rate of growth of four percent.
In estimating the impact of the bill, the OLS adjusts its FY 2025 projection upward to include
a one-time catch-up payment equal to the first two quarters of estimated payments in tax year 2024,
given the retroactivity of the bill to January 1, 2024. The OLS estimates the catch-up payment at
$242 million.
Similarly, the office’s FY 2029 projection is reduced by the estimated amount of two quarters
of estimated payments that will not be due in FY 2029 because of the expiration of the corporate
transit fee on January 1, 2029.
According to information received from the Department of the Treasury, over 600 corporate
taxpayers will be subject to the corporate transit fee.
Unit: Legislative Budget and Finance Office
Analyst: Juan C. Rodriguez
Oscar A. Mendez
Revenue and Economic Policy Analysts
Approved: Thomas Koenig
Legislative Budget and Finance Officer
This fiscal note has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).