The proposed bill, known as the Marriage Penalty Elimination Act, aims to revise the gross income tax rates for joint filers and similar taxpayers in New Jersey. The bill addresses the issue of the marriage penalty, which occurs when married couples face a higher tax liability by filing jointly compared to what they would owe if they filed as single individuals. To promote tax equity, the bill amends the tax brackets for joint filers to align them with those for individual filers, thereby reducing the tax burden for most joint filers.

Key changes include establishing a tax rate of 1.40% for taxable income up to $40,000 and a rate of 1.75% for income over $40,000 but not exceeding $70,000. Additional adjustments are made to the tax brackets for higher income levels, ensuring that the tax structure is more favorable for married couples. The bill is set to take effect immediately and will apply to taxable years beginning on or after January 1, 2022.