New Jersey Eliminates Future Sales Tax Holidays and Exemption for Zero Emission VehiclesJuly 2, 2024

By David Engel, CPA

On June 28, 2024, Governor Phil Murphy signed legislation that will eliminate the annual sales tax holiday after 2024 and phases out the sales and use tax exemption for zero emission vehicles starting October 1, 2024. (L. 2024, A4702 (c.19), effective 06/28/2024 and as stated.)

Elimination of sales tax holidays. The sales tax holiday scheduled to start on August 24, 2024 and to end on September 2, 2024, will be held as scheduled. The law provides that effective October 1, 2024, the sales tax holiday is repealed.

Zero emissions vehicle exemption phaseout. The zero emissions sales and use tax exemption will begin phasing out on October 1, 2024 when the tax rate of 3.3125% will be applied for zero emissions vehicles sold on or after October 1, 2024 but before July 1, 2025. The rate will increase to the regular sales tax rate of 6.625% for zero emissions vehicles sold on or after July 1, 2025.

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