This bill proposes a reduction in New Jersey's sales and use tax rate from the current 6.625% to 6%, effective January 1, 2026. The amendment to Section 3 of P.L.1966, c.30 (C.54:32B-3) specifies this new rate, following a gradual decrease from 6.875% starting January 1, 2017, and maintaining the 6.625% rate from January 1, 2018, until the new rate takes effect. The bill also clarifies definitions and exclusions related to taxable services and sales, ensuring that services rendered by individuals not engaged in regular trade or business are exempt from taxation, and updates language regarding prepared food sales and accommodation rentals.

Additionally, the bill outlines specific tax rates for various timeframes, including a 7% rate for certain transactions prior to July 15, 2006, and a 6.875% rate for transactions between January 1, 2017, and January 1, 2018. It maintains the 6.625% rate for services and sales from January 1, 2018, until the new 6% rate takes effect in 2026. The legislation also addresses tax obligations for contractors and subcontractors, ensuring that the tax rate applicable at the time of contract remains in effect. Overall, the bill aims to provide a structured approach to tax rates while ensuring clarity and compliance with existing tax laws.

Statutes affected:
Introduced: 54:32B-3, 54:32B-6, 54:32B-8.19, 54:32D-1