Bill Text: NJ A1522 | 2024-2025 | Regular Session | Introduced
Bill Title: Temporarily lowers corporation business tax rate for five years and repeals corporation business surtax.
Spectrum: Partisan Bill (Republican 4-0)
Status: (Introduced) 2024-01-09 - Introduced, Referred to Assembly Commerce, Economic Development and Agriculture Committee [A1522 Detail]
Download: New_Jersey-2024-A1522-Introduced.html
STATE OF NEW JERSEY
221st LEGISLATURE
PRE-FILED FOR INTRODUCTION IN THE 2024 SESSION
Sponsored by:
Assemblyman GERRY SCHARFENBERGER
District 13 (Monmouth)
Assemblywoman VICTORIA A. FLYNN
District 13 (Monmouth)
Co-Sponsored by:
Assemblyman Auth and Assemblywoman Matsikoudis
SYNOPSIS
Temporarily lowers corporation business tax rate for five years and repeals corporation business surtax.
CURRENT VERSION OF TEXT
Introduced Pending Technical Review by Legislative Counsel.
An Act temporarily lowering the corporation business tax rate and eliminating the corporation business surtax, and supplementing P.L.1945, c.162 (C.54:10A-1 et seq.) and repealing section 1 of P.L.2018, c.48 (C.54:10A-5.41).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Notwithstanding the provisions of subsection c. of section 5 of P.L.1945, c.162 (C.54:10A-5) or any other law, rule, or regulation to the contrary, for a taxpayer's first privilege period beginning on or after January 1 following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill) and for the next four privilege periods thereafter, a taxpayer that is not an S corporation or a partnership with an entire net income of more than $100,000 for a privilege period shall be assessed a franchise tax at a rate of 7.5 percent of the taxpayer's entire net income for the privilege period.
2. Section 1 of P.L.2018, c.162 (C.54:10A-5.41) is repealed.
3. This act shall take effect immediately and shall apply to privilege periods beginning on or after January 1 of the year following enactment.
STATEMENT
This bill temporarily lowers the franchise tax rate imposed on the net income of a corporation that is not an S corporation or a partnership with an entire net income of more than $100,000 for a privilege period from nine percent to seven and a half percent for five corporate tax years and repeals the corporation business surtax. Under current law, certain corporations are subject to a franchise tax rate of nine percent in addition to a two and a half percent surtax on their net income for the corporate tax year. It is the sponsor's hope that by lowering the franchise tax rate and repealing the corporation business surtax ahead of its expiration on December 31, 2023, the State can better promote economic development and job creation by relieving the tax burden on New Jersey businesses.
