New Jersey Sales Tax: The Basic Rate and What It Covers

New Jersey's statewide sales tax rate is 6.625 percent. This is the tax added to most goods you buy at a store or online. The rate is uniform across all counties — you pay the same percentage whether you shop in Newark, Atlantic City, or Cape May.

Sales tax applies to tangible personal property, which means physical items you can touch and take home. Clothing, electronics, furniture, groceries (with exceptions), and restaurant meals are all taxed. The tax does not apply to services — haircuts, car repairs, or legal advice are not subject to sales tax in New Jersey.

When you see a price tag that says $10, the actual amount you pay at checkout will be $10.66 (plus any local tax in certain municipalities). The tax is calculated on the sale price and collected by the seller at the point of purchase.

Key Takeaways

  • New Jersey's sales tax rate is 6.625 percent statewide, and this rate applies uniformly in every county.
  • Sales tax covers most goods but not services, and groceries are generally exempt unless they are prepared foods or certain items.
  • Some municipalities add a local tax on top of the state rate, so your total tax can be higher than 6.625 percent depending on where you shop.
  • Online purchases from out-of-state sellers are subject to New Jersey sales tax if the seller has a physical presence in the state or meets federal thresholds.

What Is and Is Not Taxed in New Jersey

Groceries and unprepared food are exempt from sales tax in New Jersey. This means milk, bread, vegetables, and raw meat do not have tax added. However, prepared foods — items from a deli counter, bakery items sold by the piece, or food from a restaurant — are taxed at the full 6.625 percent rate.

Clothing and footwear under $110 per item are exempt from sales tax. A shirt that costs $50 is not taxed. A pair of shoes for $105 is not taxed. But a coat that costs $150 is taxed on the full amount. This exemption applies only to the item itself, not to accessories like belts or hats.

Prescription medications are exempt. Over-the-counter medicines and vitamins are taxed. Newspapers and magazines are exempt. Books are exempt. Diapers and feminine hygiene products are exempt.

Services are not taxed. A plumber's labor is not subject to sales tax, though any parts or materials they install may be. A doctor's visit is not taxed. A haircut is not taxed. However, if you buy a haircare product at a salon, that product is taxed.

Local Sales Tax on Top of the State Rate

Some New Jersey municipalities add a local sales tax on top of the 6.625 percent state rate. This local tax varies by location and can range from 0 to 1.125 percent. Your total tax rate depends on where the sale takes place, not where you live.

For example, if you shop in a municipality with a 0.5 percent local tax, your total rate is 7.125 percent. If you shop in a municipality with no local tax, you pay only 6.625 percent. The seller's register is programmed for their location, so the tax charged reflects the store's address.

To find out the local tax rate in a specific municipality, you can contact the New Jersey Division of Taxation or check the municipality's tax assessor's office. The rate does not change based on what you buy — the local tax applies to all taxable items in that location.

How Sales Tax Is Collected and Remitted

The seller collects sales tax from you at the time of purchase and holds it temporarily. The seller is responsible for remitting this tax to the New Jersey Division of Taxation on a regular schedule — usually monthly or quarterly, depending on the volume of sales.

As a buyer, you do not file sales tax yourself or send money to the state. The seller handles all reporting and payment. Your role is to pay the tax amount shown at checkout. If you believe you were charged incorrectly, you can contact the seller or the Division of Taxation to report it.

Businesses that collect sales tax must register with the state and obtain a sales tax permit. They keep records of all taxable sales and submit returns showing how much tax they collected and remitted.

Sales Tax on Online and Out-of-State Purchases

If you buy something online from a retailer based outside New Jersey, you may still owe New Jersey sales tax. The rule depends on whether the seller has a nexus — a physical presence or significant business connection — in New Jersey. Large online retailers like Amazon have nexus in New Jersey and collect sales tax on orders shipped to New Jersey addresses.

If an out-of-state seller does not have nexus in New Jersey and does not collect sales tax, you are technically responsible for paying use tax to New Jersey. Use tax is the same rate as sales tax and applies to items you bring into the state or have shipped to you. In practice, most individual buyers do not pay use tax unless they are audited, but the obligation exists.

The safest approach is to assume that any purchase shipped to a New Jersey address will have sales tax added by the seller if they are required to collect it. If no tax is charged and you are unsure whether you owe it, you can contact the Division of Taxation for clarification on a specific purchase.

Sales Tax Refunds and Special Situations

If you overpay sales tax or are charged tax on an exempt item, you can request a refund from the seller. Most stores will refund the tax if you return the item within their return window. Keep your receipt as proof of purchase and the tax amount paid.

If you bought an exempt item and were incorrectly charged tax, contact the store's customer service with your receipt. Provide the item description and the date of purchase. The store should issue a refund for the tax portion.

Certain organizations, such as nonprofits and government agencies, may be exempt from paying sales tax on purchases. These organizations must register with the state and obtain a resale certificate or exempt organization certificate to avoid tax at checkout.

Frequently Asked Questions

Do I pay sales tax on clothing in New Jersey?

Clothing and footwear under $110 per item are exempt from sales tax. Items over $110 are taxed on the full price. Accessories like belts, scarves, and hats are taxed regardless of price.

Is restaurant food taxed in New Jersey?

Yes. Prepared food, including restaurant meals, deli items, and bakery goods sold by the piece, are all subject to the full 6.625 percent sales tax plus any local tax.

What is the difference between sales tax and use tax?

Sales tax is collected by the seller when you buy something. Use tax is a tax you owe on items purchased out of state and brought into New Jersey, at the same rate as sales tax. Most people do not pay use tax unless audited.

Do I pay sales tax on groceries?

Unprepared groceries like milk, bread, and raw vegetables are exempt. Prepared foods from a deli, bakery items sold individually, and items from a restaurant are taxed.

Why is my total tax higher than 6.625 percent?

Some municipalities add a local sales tax on top of the state rate. Your total tax depends on where the store is located, not where you live. Check your receipt or contact the store to learn the local rate in that area.