New Jersey’s sales tax is a flat 6.625% charged on most retail purchases of tangible goods, digital products, and certain services, collected by sellers at the register and sent to the state. The same 6.625% rate applies as a use tax when you buy taxable items from out-of-state sellers who don’t collect New Jersey tax. Both are authorized under the Sales and Use Tax Act (N.J.S.A. 54:32B-1 et seq.) and go to the state’s general fund.1New Jersey Division of Taxation. ANJ-7 New Jersey Use Tax
One Statewide Rate
The 6.625% rate is the same in all 21 counties. New Jersey does not let cities or counties add a local sales tax, so what you pay in Newark is what you pay in Cape May.
There is one exception. In designated Urban Enterprise Zones, certified businesses holding a UZ-2 certification may charge half the standard rate — 3.3125% — on qualifying retail sales.2Justia Law. New Jersey Code 52-27H-80 The reduction only applies to sellers with the proper certification, so being inside a zone is not enough on its own.
What Is Taxable
Sales tax applies to tangible personal property: physical items you can see, touch, or measure, including furniture, electronics, and appliances.3Justia Law. New Jersey Code 54-32B-2 – Definitions Digital products carry the same rate: downloaded music, movies, e-books, and prewritten software are all taxable.4New Jersey Division of Taxation. New Jersey Sales Tax Guide
Several services are taxable too:
- Telecommunications, including mobile phone plans and landline service.
- Maintenance and repair work on physical property, vehicles, and real property improvements.
- Admissions to sporting events, concerts, amusement parks, and movie theaters.5Legal Information Institute. N.J.A.C. 18-24-2.16
Professional services from doctors, lawyers, and accountants are generally not taxable.4New Jersey Division of Taxation. New Jersey Sales Tax Guide Repair of property is taxable; advice about it usually is not.
What Is Exempt
Clothing and Shoes
Most clothing and footwear meant for everyday human wear is exempt, with no price cap. The exemption does not cover fur clothing, sport or recreational equipment, clothing accessories, or protective equipment. A winter coat is tax-free; ski goggles and fur-lined accessory gloves are not.
Groceries
Food and food ingredients sold for home consumption are exempt. The line is “prepared food.” If the item is sold hot, combined by the seller into something ready to eat, or served with utensils, it is taxable at the full rate.4New Jersey Division of Taxation. New Jersey Sales Tax Guide A loaf of bread is exempt. A sandwich made at the deli counter is taxed.
Medication
Prescription drugs and over-the-counter medications sold for human use are exempt.6Justia Law. N.J.S.A. 54:32B-8.1
Casual Sales Between Individuals
When someone who is not in the business of selling makes an occasional private sale, like a garage sale, the transaction is generally exempt. The exemption does not apply to motor vehicles or boats. If you buy a used car or a registered vessel from a private seller, you still owe sales tax when you title or register it.7Justia Law. N.J.S.A. 54:32B-8.6
Nonprofits
Qualifying religious, charitable, educational, scientific, veterans’, volunteer fire, and parent-teacher organizations can apply for an Exempt Organization Certificate (Form ST-5) from the Division of Taxation. Once issued, the ST-5 lets them buy tax-free from vendors. The exemption application (Form REG-1E) is free.8NJ Division of Taxation. Nonprofit Organizations FAQs
Use Tax on Out-of-State Purchases
When you buy something taxable from an out-of-state retailer — online, by phone, or while traveling — and the seller does not charge New Jersey sales tax, you owe use tax at the same 6.625% rate.1New Jersey Division of Taxation. ANJ-7 New Jersey Use Tax If another state’s sales tax was charged at a lower rate, you owe only the difference.
Individuals report use tax on Line 51 of the annual NJ-1040. Even if you owe nothing, you need to enter “0.00” rather than leave the line blank. Worksheet K in the instructions walks through the calculation.9NJ.gov. 2025 Form NJ-1040 Instructions Many large online retailers already collect New Jersey tax, but smaller sellers often don’t, so it helps to keep a running list of untaxed purchases through the year.
If You Sell in New Jersey
Any person or business planning to sell taxable goods or services in New Jersey must file a Business Registration Application (Form NJ-REG) with the Division of Revenue and Enterprise Services at least 15 business days before starting. That includes part-time sellers at flea markets and craft shows.10NJ.gov. Starting a Business in NJ You’ll need your federal EIN, business entity ID (for corporations, LLCs, and partnerships), and NAICS code, and you must indicate on the form that you’ll be collecting sales tax.11Business.NJ.gov. Register for Taxes
Businesses buying inventory for resale can skip paying sales tax on those purchases by giving the seller a completed Resale Certificate (Form ST-3). Sellers who receive a fully completed ST-3 within 90 days of the sale are relieved of liability for not collecting tax, and both parties must keep the certificate on file for four years.12NJ.gov. Form ST-3 Instructions
Filing Deadlines
All sales tax returns are filed electronically through the NJ Tax Portal at taxportal.nj.gov.13NJ.gov. Filing and Remitting Sales and Use Tax Every registered business files a quarterly return on Form ST-50, due on the 20th day of the month after the quarter ends: April 20, July 20, October 20, and January 20. Businesses that collected more than $30,000 in sales tax the previous year also owe monthly payments by the 20th of the two non-quarter months.14NJ.gov. Sales and Use Tax Filing Chart
Payment options are electronic check, EFT, or credit card (with a processing fee). A payment is timely if initiated by 11:59 p.m. on the due date, even if the funds settle the next business day. Businesses with a prior-year liability of $10,000 or more in any single tax must pay all their taxes by EFT.15NJ Division of Taxation. EFT Payment Options
Penalties and Interest
Filing late triggers a penalty of 5% of the tax due for each month or partial month the return is overdue, capped at 25%. The Division may also charge $100 for each month the return stays unfiled.16NJ Division of Taxation. Penalties, Interest, and Collection Fees Unpaid balances accrue interest at the federal prime rate plus 3%, compounded annually; for 2026 the assessed rate is 10%. At year-end, unpaid tax, penalties, and accrued interest fold into the balance that carries forward, so the cost grows quickly.17NJ.gov. Interest Rates Assessed
Getting a Refund if You Overpaid
If you or your business paid too much sales or use tax, you can file a claim with the Division of Taxation using Form A-3730. The statute of limitations is four years, so you can recover overpayments from the most recent 16 rolling quarters. Miss that window and the refund is gone.