Home Notice: Sales and Use Tax Rate Change

Notice: Sales and Use Tax Rate Change

Effective January 1, 2018, the New Jersey Sales and Use Tax Rate is 6.625%.

Before January 1, 2017, the Sales Tax rate was 7%. Per P.L. 2016, c. 57, the New Jersey Sales and Use Tax rate was reduced in phases between 2017 and 2018:

6.875% on sales made between January 1, 2017, and December 31, 2017.

6.625% on sales made on and after January 1, 2018.

Changes for Sellers

For taxable sales on and after January 1, 2018, sellers must collect and remit Sales Tax at the rate of 6.625% except under specific circumstances provided for by law. Sales Tax is levied on:

Tangible personal property;

Specified digital products; and

Enumerated services.

The Division of Taxation has updated Sales Tax Collection Schedule (Form ST-75) , which is effective January 1, 2018. Form ST-75 rounds the amount of taxes owed to the nearest full cent. All tax calculations should be rounded accordingly. (See, "How to Calculate the Sales Tax.") The tax rate (6.625%) is not rounded when calculating taxes owed.

Taxable Transactions

Sales Made Before January 1, 2018, but Delivered On or After January 1, 2018.

If the tangible personal property or specified digital products are sold and delivered, or services are rendered, between January 1, 2017, and December 31, 2017, the seller must collect Sales Tax at the rate of 6.875%.

If the property, products, or services are sold between January 1, 2017, and December 31, 2017, but are delivered or rendered on or after January 1, 2018, the seller must collect tax at the rate of 6.625%.

Sales Made Before January 1, 2017; Delivery on and After January 1, 2017:

If the tangible personal property or specified digital products are sold and delivered or services are rendered before January 1, 2017, the seller must collect tax at the rate of 7%. If the tangible personal property, specified digital products, or services are sold before January 1, 2017, but the tangible personal property or specified digital products are delivered, or the services rendered on or after January 1, 2017, but before January 1, 2018, the seller must collect tax at the rate of 6.875%.