SENATE ECONOMIC GROWTH COMMITTEE

STATEMENT TO

SENATE, No. 3189

with committee amendments

STATE OF NEW JERSEY

DATED:  OCTOBER 10, 2024

      The Senate Economic Growth Committee reports favorably and with committee amendments Senate Bill No. 3189.

      As amended and reported, this bill increases the amount of the tax credit provided under the “New Jersey Angel Investor Tax Credit Act” for a qualified investment made in a New Jersey emerging technology business venture.  Under current law, a taxpayer is allowed a credit against the gross income tax and corporation business tax in an amount equal to 20 percent of a qualified investment made by the taxpayer in a New Jersey emerging technology business or a qualified venture fund.  A taxpayer may also qualify for an additional five percent credit when the qualified investment is made in: (1) an emerging technology business that is located in an opportunity zone or a low-income community; or (2) an emerging technology business that is a minority business or women’s business, and, in the case of a qualified venture fund, if the qualified venture fund commits by contract to invest 50 percent of its funds in diverse entrepreneurs.

      The bill increases the amount of the tax credit that may be provided to a taxpayer from 20 percent to 35 percent of the taxpayer’s qualified investment in a New Jersey emerging technology business or qualified venture fund.  The bill also increases the total amount of the tax credit provided to taxpayers that qualify for the additional five percent credit from 25 percent to 40 percent of a taxpayer’s qualified investment.  The bill also revises the definitions of “New Jersey based business” and “New Jersey emerging technology business” to lower, from 224 to 149, the maximum number of employees that a business may employ in order for a taxpayer to qualify for the tax credit.

COMMITTEE AMENDMENTS:

      The committee amended the bill to provide that:

      (1) the amount of the standard tax credit would equal 35 percent of a taxpayer’s qualified investment, not 60 percent of these investments, as previously provided in the bill; and

      (2) the total amount of the tax credit would equal 40 percent of a taxpayer’s qualified investments in certain businesses, not 65 percent of these investments, as previously provided in the bill.