STATE OF NEW JERSEY
222nd LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION
Sponsored by:
Senator LATHAM TIVER
District 8 (Atlantic and Burlington)
Senator JOSEPH PENNACCHIO
District 26 (Morris and Passaic)
Co-Sponsored by:
Senators Amato, A.M.Bucco, Corrado and Testa
SYNOPSIS
Suspends sales and use tax and societal benefits charge on electric and gas public utility bills during four-month period.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act concerning a temporary suspension of certain charges on electric and gas public utility bills.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. For the purposes of this section, “electric or gas public utility” means a public utility, as that term is defined in R.S.48:2-13, that distributes electric or gas service to end users.
b. Notwithstanding any provision of law, rule, or regulation to the contrary, beginning on June 1, 2025 and through September 30, 2025, the sale or use of electric or gas utility service shall be exempt from the tax imposed pursuant to the “Sales and Use Tax Act,” P.L.1966, c.30 (C.54:32B-1 et seq.), and no seller of electric or gas utility service may include any tax imposed pursuant to the “Sales and Use Tax Act” within the purchase price of electric or gas utility service during that period.
c. Notwithstanding any provision of law, rule, or regulation to the contrary, beginning on June 1, 2025 and through September 30, 2025, an electric or gas public utility shall not be permitted to charge customers any amount for the societal benefits charge otherwise authorized pursuant to section 12 of P.L.1999, c.23 (C.48:3-60).
2. This act shall take effect immediately and shall expire on October 1, 2025.
STATEMENT
This bill temporarily suspends the imposition of the sales and use tax, as well as the societal benefits charge, on customer bills for electric and gas utility service. Under the bill, the temporary suspension applies beginning on June 1, 2025 and through September 30, 2025. It is the sponsor’s intent that a temporary suspension of the collection of these charges provide necessary relief from anticipated bill increases and excessive charges to ratepayers.
The Board of Public Utilities has announced increases in the electricity rates for residential ratepayers ranging from 17.2 to 20.2 percent, depending on the supplier, starting in June 2025. Consequently, sales and use tax collections from energy and utility sales are anticipated to increase by as much as $85.2 million more than the Governor had initially anticipated for Fiscal Year 2026.
Furthermore, during Fiscal Years 2021 through 2024, approximately $704.2 million in revenues generated by the societal benefits charge were transferred to other funds for purposes outside the intent of the charge. In light of the amount of excess revenue generated by the societal benefits charge, it is the sponsor’s opinion that the amount collected through the societal benefits charge can be reduced in order to provide necessary relief to ratepayers.