New Jersey Sales Tax Calculator

One statewide rate of 6.625%, with a half-rate exception

New Jersey charges a single 6.625% sales tax everywhere in the state. Counties and cities cannot add their own general sales tax, so the rate is the same in Newark, Jersey City, Cherry Hill and Cape May. The rate has been 6.625% since January 1, 2018, when it fell from 6.875%. A year earlier it had dropped from 7% to 6.875%.

The exception is Urban Enterprise Zones (UEZs), where qualifying sales may be taxed at half the rate, 3.3125%. The reduced rate only applies at certified businesses. It covers most goods (but not motor vehicles or energy) and most services (but not telecommunications or utility services). If a store in a UEZ is not certified, or the item is excluded, you pay the full 6.625%.

What New Jersey does not tax

New Jersey’s exemptions cover many basic household purchases. According to the Treasury’s tax expenditure report, exempt items include most food sold as grocery items, most clothing and footwear, disposable paper products for household use, prescription drugs and over-the-counter drugs.

Several of these exemptions depend on how the item is used. Paper products are exempt when bought for a home but taxable when bought for a business, so the same pack of toilet paper is taxed when an office buys it for its restroom. Prepared food and restaurant meals are not grocery items and are taxed.

• Groceries: mostly exempt.
• Clothing and shoes: mostly exempt, with no price cap.
• Prescription and over-the-counter medicines: exempt.
• Household paper towels, tissues and toilet paper: exempt for home use.
• Electronics, furniture, appliances and restaurant meals: taxed at the full rate.

Use tax: Delaware, Pennsylvania and online purchases

You owe New Jersey use tax when you buy something taxable for use in New Jersey and the seller either charged no sales tax or charged less than New Jersey’s rate. This comes up often near the borders. Delaware has no sales tax, so a taxable item bought there and brought home owes the full New Jersey rate as use tax.

Publication ANJ-7 explains how credit for another state’s tax works. If you buy and take delivery in a state that gives New Jersey similar credit, you can subtract the tax you paid there. In the Division’s own example, a $100 purchase taxed at 4% elsewhere leaves $2.63 due to New Jersey ($6.63 minus $4.00). If the out-of-state seller ships the item to New Jersey, no credit is allowed and use tax is due on the full price including delivery. Items bought in a foreign country get no credit at all.

Individuals report use tax on the NJ-1040 income tax return, or on Form ST-18 within 20 days of bringing the item into the state. Example: a $1,800 sofa bought in Delaware (0% sales tax) and taken home owes $119.25 of New Jersey use tax.

New Jersey’s rate history

New Jersey’s rate has fallen twice in recent years, which matters if you are checking an old receipt or a use tax bill for an earlier purchase. The use tax rate always matches the sales tax rate in effect on the purchase date.

New Jersey against New York, Pennsylvania and Delaware

New Jersey’s flat rate is lower than New York City’s 8.875% and slightly above Pennsylvania’s 6% base rate. Delaware charges no sales tax at all. New Jersey also exempts most clothing at any price, while New York’s clothing exemption stops at items under $110 and only removes local tax in some localities.

Mistakes to avoid with New Jersey sales tax

A few New Jersey rules catch shoppers and small sellers out.

• Charging tax on clothing. Most clothing and footwear is exempt regardless of price.
• Assuming every store in an Urban Enterprise Zone charges half. Only certified sellers can, and motor vehicles never qualify.
• Forgetting delivery rules. If an out-of-state seller ships to New Jersey, tax you paid to another state is not credited against New Jersey use tax.
• Treating business paper products as exempt. The paper goods exemption is for household use only.

Cars, and checking a New Jersey receipt

New Jersey charges 6.625% on the purchase price of new and used vehicles. UEZ rates do not apply to motor vehicles, so a car from a dealer in a zone still carries the full rate. On a $28,000 car that is $1,855.00.

Because there is one rate, checking a receipt is simple. Divide the total by 1.06625 to get the pre-tax price. A $53.31 total is $50.00 plus $3.31 of tax. If the tax on a receipt from a UEZ store is about half of that, the store applied the reduced rate.