Understanding Sales Tax in New Jersey for 2025
If you live in, work in, or do business with New Jersey, it's important to know how the state's sales tax rules affect you. Whether you're a consumer, a small business owner, or a retailer, understanding the latest New Jersey sales tax rates, exemptions, and regulations for 2025 can save you money and prevent legal issues.
New Jersey has unique rules compared to other states, and staying compliant with current tax law is key in avoiding penalties or costly mistakes.
Current New Jersey Sales Tax Rate for 2025
As of January 1, 2025, the statewide base sales tax rate in New Jersey remains at 6.625%. There haven't been any changes to the base rate since the rollback from 7% in 2018.
Here's how it breaks down:
- Statewide Base Rate: 6.625%
- Urban Enterprise Zones (UEZs): 3.3125% on eligible purchases
- Luxury and Specific Items: May be subject to additional taxes (e.g., hotel occupancy, car rentals)
Cities and counties in New Jersey are not allowed to add their own local sales taxes. This makes tax compliance simpler than in some other states like New York or California.
What Is Subject to Sales Tax in New Jersey?
New Jersey imposes sales tax on the retail sale of most tangible goods and some services. If you're selling taxable goods or services in New Jersey, you're required to collect and remit sales tax.
Items and services typically taxed in NJ include:
- Electronics and home appliances
- Furniture
- Prepared foods and restaurant meals
- Clothing accessories (e.g., handbags, belts)
- Beauty and grooming services
- Cleaning services
New Jersey Sales Tax Exemptions in 2025
Understanding what is exempt from New Jersey sales tax can help you avoid overpaying at checkout. Here are common exemptions effective for 2025:
- Unprepared food items: Groceries like produce, milk, and bread remain tax-free.
- Clothing and footwear: Most everyday apparel is exempt, but accessories and athletic gear may be taxed.
- Prescription drugs and medical devices: These are fully exempt.
- Textbooks and educational materials: Often exempt for students with school documentation.
- Resale and manufacturing purchases: Businesses can use resale certificates to buy inventory without tax.
You may need to file an ST-3 or ST-4 exemption form, depending on the exemption category and whether you're a seller or buyer.
How to Collect and Remit Sales Tax in NJ
If you're a business operating in New Jersey or selling to New Jersey residents remotely, you are required to:
- Register with the New Jersey Division of Revenue and Enterprise Services.
- Collect sales tax at the point of sale unless an exemption applies.
- File and remit the collected tax either monthly or quarterly, depending on your total tax liability.
Businesses with more than $500 in monthly sales tax liability usually must file monthly. Others may file quarterly or semi-annually. You can submit your filings and payments electronically through the NJ Division of Taxation online portal.
Remote Sellers and Marketplace Facilitator Rules in 2025
If you’re not located in New Jersey but sell to its residents, you may still have a tax obligation under economic nexus rules. Since 2018, New Jersey has enforced the following requirements:
- You must collect NJ sales tax if you make more than $100,000 in sales or 200 or more separate transactions into the state annually.
- Marketplace facilitators (like Amazon, Etsy, or Walmart Marketplace) must collect and remit sales tax on behalf of third-party sellers.
Remote sellers meeting these thresholds must register with the state and begin charging the appropriate tax rate.
Sales Tax Holiday in New Jersey
New Jersey has a temporary tax holiday on select back-to-school items. For the 2025 season, this sales tax break is set to run from August 24 to September 2.
Eligible tax-free items include:
- School supplies and art materials
- Computers and software (up to $3,000)
- School instructional materials
- Sport and recreational equipment
Retailers must honor the tax exemption on qualifying items, regardless of how items are paid for—cash, credit, layaway, or store financing.
Important Sales Tax Filing Dates in New Jersey
Businesses should keep track of these filing milestones to avoid late fees:
- Monthly Filers: Due on the 20th of the following month
- Quarterly Filers: Due on the 20th after the quarter ends (e.g., April 20, July 20)
- Annual Filers: Typically due January 20 of the following year
Always confirm your filing frequency when registering your sales tax certificate. It's based on projected volume and may change as your business grows.
Common Mistakes to Avoid with NJ Sales Tax
Get your sales tax management right by avoiding these issues:
- Failing to register before selling taxable goods or services
- Not collecting tax on delivery or shipping when required
- Improper use of exemption certificates
- Missing filing deadlines or underreporting sales
- Assuming that all clothing or groceries are tax-free in every case
If you're unsure, consult a tax advisor or accountant who specializes in New Jersey tax law.
Frequently Asked Questions About NJ Sales Tax in 2025
Is clothing taxable in New Jersey?
Most clothing is exempt from sales tax in New Jersey. However, accessories like jewelry, handbags, and sports equipment are taxable. Always check item categories before assuming exemption.
Do I need to collect sales tax if I sell online in NJ?
Yes, if your business meets the economic nexus threshold—over $100,000 in annual sales or 200+ transactions—you must register to collect NJ sales tax. Marketplace platforms may handle this on your behalf if you're a third-party seller.
What items are exempt during the New Jersey sales tax holiday?
During the sales tax holiday in late August, items like school supplies, computers (under $3,000), sport equipment, and instructional materials are exempt from sales tax. Check the NJ Division of Taxation website for current lists and criteria.
How can I file New Jersey sales tax?
You can file and pay New Jersey sales tax through the NJ Division of Taxation online portal. Use your NJ sales tax certificate number and follow the appropriate filing frequency (monthly, quarterly, annually).
What is a resale certificate and how does it work in NJ?
A resale certificate allows a business to buy products without paying tax if those products will be resold. In New Jersey, use form ST-3 (Resale Certificate) and provide it to your supplier. Keep records of all certificates in case of audit.
