New Jersey's sales tax rate and what it covers
New Jersey charges a 6.625% sales tax on most goods and services you buy in the state. This is the statewide rate that applies everywhere in New Jersey. When you buy something at a store, restaurant, or online retailer shipping to New Jersey, this percentage gets added to your bill at checkout.
Not everything is taxed at this rate. Groceries, prescription medications, and certain medical equipment are exempt — you do not pay sales tax on these items. Clothing and footwear under $110 per item are also exempt. Services like haircuts, repairs, and professional fees are generally not subject to sales tax, though there are exceptions depending on what the service is.
Some counties in New Jersey add a local tax on top of the state rate. This local tax ranges from 0% to 1.125%, depending on which county you are in. So your total sales tax could be anywhere from 6.625% to 7.75%, depending on your location. When you check out, the retailer calculates both the state and local portions and shows you the total.
Key Takeaways
- New Jersey's statewide sales tax is 6.625%, and some counties add a local tax of up to 1.125% on top of that.
- Groceries, prescription drugs, and clothing under $110 are not subject to sales tax in New Jersey.
- Services like haircuts and repairs are generally not taxed, but some specific services have different rules.
- Online purchases shipped to New Jersey are subject to the same sales tax as in-store purchases.
What items are exempt from New Jersey sales tax
Food and beverages for home consumption are the largest exempt category. This includes milk, bread, vegetables, meat, frozen dinners, and canned goods. However, prepared foods — items you eat right away like deli sandwiches, hot pizza, or food from a restaurant — are taxed. The rule is whether you are taking it home to eat later or consuming it on the spot or immediately.
Prescription medications are never taxed in New Jersey. Over-the-counter medicines like aspirin or cold medicine are taxed as regular goods. Medical devices prescribed by a doctor, such as diabetic testing supplies or mobility aids, are exempt. Eyeglasses and contact lenses are also exempt when prescribed.
Clothing and footwear under $110 per item escape the tax. A pair of jeans for $80 is not taxed. A winter coat for $150 is taxed on the full amount. If you buy multiple items in one transaction, each item is measured separately against the $110 threshold.
How sales tax applies to online and mail orders
If you order something online and it ships to a New Jersey address, you pay New Jersey sales tax. This applies whether you order from a New Jersey company, an out-of-state company, or a marketplace like Amazon. The retailer collects the tax at checkout and sends it to the state.
Some older online retailers do not collect New Jersey sales tax automatically. If this happens, you may owe the tax yourself when you file your state income tax return, though most people do not report this. The safest approach is to assume you will pay tax on online purchases to New Jersey addresses, because most major retailers now do.
Mail orders and phone orders follow the same rule as online orders. If the item ships to New Jersey, New Jersey sales tax applies. The method of ordering does not change the tax treatment.
Local sales tax by county
Seven New Jersey counties charge an additional local sales tax on top of the 6.625% state rate. These counties are Bergen, Hudson, Passaic, Essex, Union, Morris, and Middlesex. The local rate varies by county:
| County | Local Tax Rate | Total Sales Tax |
|---|---|---|
| Bergen | 1.125% | 7.75% |
| Hudson | 1.125% | 7.75% |
| Passaic | 1.125% | 7.75% |
| Essex | 1.125% | 7.75% |
| Union | 1.125% | 7.75% |
| Morris | 0.625% | 7.25% |
| Middlesex | 0.625% | 7.25% |
All other New Jersey counties have no local sales tax, so the rate is 6.625%. When you shop in Bergen County, for example, you pay 7.75%. When you shop in Atlantic County, you pay 6.625%. The retailer's location determines which rate applies, not where you live.
Services and what gets taxed
Most personal services are not subject to sales tax in New Jersey. Haircuts, manicures, massages, and dental work are not taxed. Car repairs, appliance repairs, and plumbing services are not taxed. Legal services and accounting services are not taxed. The general rule is that labor and expertise are exempt.
However, some services do get taxed. Telecommunications services — your phone bill and internet bill — are taxed. Parking fees and storage fees are taxed. Pest control services are taxed. Landscaping services are taxed. The distinction is not always obvious, so if you are unsure whether a service is taxed, ask the provider before you pay.
When a service includes materials, the materials may be taxed separately from the labor. For example, if a contractor replaces your roof, the labor is not taxed, but the shingles and materials are taxed. The contractor should itemize these on your invoice so you can see what is and is not taxed.
Who collects and where the money goes
The retailer or service provider collects sales tax from you at the point of sale. They hold this money and send it to the New Jersey Division of Taxation, usually monthly or quarterly depending on the size of the business. The state then distributes a portion of the local sales tax to the counties and municipalities that imposed it.
Sales tax revenue funds state and local government operations. It is one of the main sources of funding for schools, roads, police, and other public services. Unlike income tax, which is based on what you earn, sales tax is based on what you spend.
Frequently Asked Questions
Do I pay sales tax on groceries in New Jersey?
No. Food and beverages intended for home consumption are exempt from sales tax. This includes produce, meat, dairy, bread, and canned goods. However, prepared foods like deli sandwiches, hot pizza, and restaurant meals are taxed.
What is the difference between the state sales tax and local sales tax?
The state sales tax of 6.625% applies everywhere in New Jersey. Seven counties — Bergen, Hudson, Passaic, Essex, Union, Morris, and Middlesex — add their own local tax on top, ranging from 0.625% to 1.125%. All other counties have no local tax.
Do I have to pay sales tax on clothes?
Clothing and footwear under $110 per item are exempt. A $90 shirt is not taxed. A $150 jacket is taxed on the full amount. Each item is measured separately, so you could buy multiple exempt items in one transaction.
Is sales tax charged on online orders shipped to New Jersey?
Yes. Online retailers must collect New Jersey sales tax on orders shipped to New Jersey addresses. This applies to purchases from any retailer, whether based in New Jersey or elsewhere.
Are haircuts and repairs subject to sales tax?
No. Personal services like haircuts, repairs, and professional services are generally not taxed in New Jersey. However, some services like telecommunications, parking, and pest control are taxed. Ask the provider if you are unsure.