New Jersey's statewide sales tax rate is 6.625 percent
New Jersey has a single statewide sales tax rate of 6.625 percent that applies to most taxable purchases. This rate is made up of a 6 percent state tax plus a 0.625 percent tax that funds the state's Earned Income Tax Credit program. Unlike many states, New Jersey does not allow counties or municipalities to add their own local sales tax on top of the state rate.
The 6.625 percent rate applies when you buy tangible goods — items you can touch and take home. It also applies to certain services, though New Jersey's list of taxable services is narrower than some other states. The rate is the same whether you shop in Newark, Atlantic City, or any other city in the state.
Key Takeaways
- New Jersey's sales tax rate is 6.625 percent statewide, with no additional local taxes added by counties or cities.
- Groceries, prescription medications, and most clothing items under $110 are exempt from sales tax in New Jersey.
- Restaurant meals, prepared foods, and most services are subject to the full 6.625 percent sales tax.
- The rate has remained at 6.625 percent since 2006, when the state added the 0.625 percent Earned Income Tax Credit portion.
What is and isn't taxed in New Jersey
New Jersey exempts groceries and unprepared food from sales tax. This means items like bread, milk, eggs, fresh produce, and meat are not taxed when you buy them at a supermarket. However, prepared foods — items made ready to eat — are taxed. This includes hot deli items, bakery goods sold warm, and food from a restaurant or takeout counter.
Prescription medications and medical devices are exempt from sales tax. Over-the-counter medications like pain relievers and cold medicine are also exempt. Clothing and footwear under $110 per item are not taxed, but items priced at $110 or more are subject to the full 6.625 percent rate.
Services in New Jersey are generally not taxed, with specific exceptions. Haircuts, dry cleaning, car repairs, and plumbing are not subject to sales tax. However, certain services are taxed: hotel rooms, parking, and telecommunications services all carry the 6.625 percent rate.
How the sales tax breaks down
The 6.625 percent rate consists of two parts. The base state sales tax is 6 percent, which has been in place for many years. On top of that, New Jersey added 0.625 percent in 2006 to fund the state's Earned Income Tax Credit program, which provides tax relief to low-income workers.
This combined rate is applied at the point of sale. When you check out at a store or restaurant, the cashier or register calculates the tax on the taxable portion of your purchase and adds it to your bill. Online purchases shipped to New Jersey are also subject to the 6.625 percent rate.
Sales tax on specific product categories
| Product or Service | Taxed at 6.625%? |
|---|---|
| Groceries and unprepared food | No |
| Restaurant meals and prepared food | Yes |
| Prescription medications | No |
| Over-the-counter medications | No |
| Clothing and shoes under $110 | No |
| Clothing and shoes $110 and over | Yes |
| Haircuts and salon services | No |
| Hotel rooms | Yes |
| Car rentals | Yes |
| Parking | Yes |
| Gasoline | No (separate fuel tax applies) |
| Electricity and natural gas | No |
When you pay sales tax versus when you don't
You pay sales tax at the register when you buy a taxable item in a store. For online purchases, the seller is responsible for collecting and sending the tax to New Jersey if they have a physical presence in the state or meet certain sales thresholds. If an online seller does not collect New Jersey sales tax, you may owe the tax yourself when you file your state income tax return, though this is rarely enforced for individual purchases.
Some purchases are exempt because of who is buying them. Nonprofits and government agencies can make tax-exempt purchases if they provide proper documentation. Resellers who hold a New Jersey resale certificate can buy items without paying sales tax if they plan to resell those items.
How New Jersey compares to nearby states
New Jersey's 6.625 percent rate is lower than New York's 8.875 percent in New York City and Pennsylvania's 6 percent state rate plus local taxes that can reach 7.25 percent in some areas. Delaware has no sales tax at all. Connecticut's rate is 6.35 percent. These differences matter if you shop near state borders, since you owe sales tax in the state where you make the purchase, not where you live.
New Jersey is also unusual because it does not allow local sales taxes. Many states let counties or cities add their own rate on top of the state tax, which can push the total to 8 or 9 percent or higher. In New Jersey, the rate is the same everywhere in the state.
Frequently Asked Questions
Do I pay sales tax on groceries in New Jersey?
No. Unprepared food items like fresh produce, meat, dairy, and bread are exempt from sales tax. However, prepared foods — items made ready to eat, such as hot deli items, bakery goods sold warm, or restaurant meals — are taxed at 6.625 percent.
Is clothing taxed in New Jersey?
Clothing and footwear under $110 per item are not taxed. Items priced at $110 or more are subject to the full 6.625 percent sales tax. The price threshold applies to each individual item, not to your total purchase.
Do I pay sales tax on gasoline in New Jersey?
No. Gasoline is not subject to the 6.625 percent sales tax. New Jersey does impose a separate fuel tax on gasoline and diesel, which is included in the price you see at the pump.
What about sales tax on online purchases?
Online sellers with a physical presence in New Jersey or who meet certain sales thresholds must collect and send the 6.625 percent sales tax. If a seller does not collect the tax, you may owe it yourself when you file your state return, though enforcement on individual purchases is uncommon.
Is there a local sales tax in New Jersey?
No. New Jersey does not allow counties or cities to add their own sales tax. The rate is 6.625 percent statewide, the same in every municipality.