Sponsored by:
Assemblyman JOSEPH VAS
District 19 (Middlesex)
Assemblyman JOHN J. BURZICHELLI
District 3 (Salem, Cumberland and Gloucester)
Assemblywoman NELLIE POU
District 35 (Bergen and Passaic)
Co-Sponsored by:
Assemblymen Chivukula, Schaer, Greenwald and L.Smith
SYNOPSIS
Allows sales tax exemption for all qualified business urban enterprise zone purchases at point of sale.
CURRENT VERSION OF TEXT
As introduced.
An Act allowing a sales tax exemption for all qualified business urban enterprise zone purchases at the point of sale, amending P.L.1983, c.303.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 20 of P.L.1983, c.303 (C.52:27H-79) is amended to read as follows:
20. a. Retail sales of personal property (except motor vehicles and energy) and sales of services (except telecommunications and utility services) to a qualified business for the exclusive use or consumption of such business within an enterprise zone are exempt from the taxes imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.).
b. [Notwithstanding the provisions of subsection a. of this section, the seller shall charge and collect from a purchaser that is not a small qualified business the tax at the rate then in effect, and the tax shall be refunded to the purchaser by the filing, within one year following the date of sale, of a claim with the New Jersey Division of Taxation for a refund of sales and use taxes paid for the goods and materials. Proof of claim for refund shall be made by the submission of auditable receipts and such other documentation as the Director of the Division of Taxation may require.] Deleted by amendment, P.L. , c. (pending before the Legislature as this bill)
c. [As used in this section:
"Qualified business" includes a business that becomes qualified by the time the refund application is filed pursuant to subsection b. of this section; and
"Small qualified business" means a qualified business that has been determined and certified by the director to have had less than $3,000,000 in annual gross receipts in that business prior annual tax period.] Deleted by amendment, P.L. , c. (pending before the Legislature as this bill)
d. [The director shall submit
to the Senate Legislative Oversight Committee and the Assembly Regulatory
Oversight Committee any rules or regulations to effectuate amendments made to
this section by P.L.2006, c.34 that are proposed for publication in the New
Jersey Register. The director shall evaluate the effectiveness of the
amendments made to this section by P.L.2006, c.34 and report any findings and
recommendations regarding the amendments to the Senate Legislative Oversight
Committee and the Assembly Regulatory Oversight Committee before the Governor
presents a budget proposal for Fiscal Year 2008.] Deleted by
amendment, P.L. , c. (pending before the Legislature as this bill)
(cf: P.L.2007, c.328, s.1)
2. This act shall take effect immediately and section 1 shall apply to sales made on or after the first day of the second month following its effective date.
STATEMENT
This bill applies at the time of purchase the sales tax exemption for certain acquisitions by qualified UEZ businesses with at least $3 million in annual gross receipts. Current law requires these businesses to pay sales tax at the time of their input purchase and thereafter to apply for a refund of taxes paid to the Division of Taxation. Other UEZ businesses already benefit from a point-of-sale exemption.
The refund mechanism has imposed an unnecessary administrative and monetary burden on local businesses. New Jersey would be better served, if businesses were to apply their limited resources to entrepreneurial objectives instead. In making the administration of the sales tax exemption more business-friendly, the bill will hence reaffirm the State’s commitment to fostering economic growth in partnership with the private sector.