DISASTER RECOVERY GUIDE

New Jersey’s $58.8B Budget Includes Some Tax Increases

 – July 1, 2025
New Jersey’s $58.8B Budget Includes Some Tax Increases

Late on June 30, Governor Murphy signed New Jersey’s FY26 budget. At $58.78 billion, it is the state’s largest-ever budget. Here’s a summary of some of the main budget items:

  • 4% increase in annual spending
  • $1.5 billion structural spending gap
  • Increase in realty transfer fee for residential and commercial properties: 2% for sales between $2 million and $2.5 million and .05% for every additional $500,000; capped at 3.5%; payable by the seller
  • Increase in tax for online gambling and sports betting to 19.75%
  • Increase in tax for cigarettes from $2.70 to $3 per pack and liquid nicotine from 10 cents per fluid milliliter to 30 cents
  • New exemption for small business investment and reforms to the Angel Investor Tax Credit
  • Nearly $4.3 billion in direct property tax relief, including $2.4 million for the ANCHOR program and $239 million for the Senior Freeze program
  • $600 million for StayNJ, which is expected to launch for the 2025 tax season and will reimburse eligible seniors for up to 50% of their property tax bills
  • Nearly $2 billion for infrastructure: state and local highway and bridge projects and NJ TRANSIT fleet modernization
  • $7.2 billion full payment to the public workers’ pension system
  • $12.1 billion for K-12 school aid

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The information in this guide has been gathered from many sources, including the Internal Revenue Service, the Social Security Administration, state agencies, professional organizations and members of the NJCPA. The majority of state agencies offer online and prerecorded services. It’s best to check online or call before you visit.  

Material contained within this guide should be augmented by, and used in accordance with, a certified public accountant's professional judgment. Your CPA can properly apply the tax laws and regulations to the facts and circumstances of your particular situation. For help with locating a CPA, visit findacpa.org.

The New Jersey Society of Certified Public Accountants is not responsible for any claims arising as a result of this information or its usage.

This guide was updated in August 2024. Future users of this material are cautioned that some portions, particularly tax-related information, may become outdated.