Does New Jersey charge sales tax on services?
by June 6, 2023
The majority of U.S. states require merchants to charge sales tax on tangible personal property (TPP), otherwise known as physical goods. Many states also implement sales and use tax on digital goods and SaaS. Because the economy has shifted over time from a manufacturing economy to a service economy, states are now looking to generate revenue by taxing services.
Here’s what merchants need to know about taxing services in the state of New Jersey, which has a state sales tax rate of 6.625%.
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Sign upDoes New Jersey charge sales tax on services?
Many services are taxable in New Jersey, including the following:
- Accounting services, such as electronic filing charges
- Admission charges for spectator sports (like baseball and basketball games) and places of amusement (like movie theaters and trade shows)
- Alarm monitoring
- Animal grooming and boarding at seller’s facility
- Telephone answering services
- Appliance repairs
- Armored car services
- Automobile repairs (labor and parts)
- Beeper and paging services
- Boat docking fees for storage (water or land)
- Calligraphy
- Car washing
- Carpet cleaning
- Catering services
- Cleaning services (janitorial)
- Computer maintenance/repair
- Credit check/report
- Delivery charges on taxable items
- Dry cleaning services (excluding clothing)
- Document fees imposed by motor vehicle dealerships for taxable motor vehicle sales
- Electronic filing charges
- Extended warranty agreements
- Fax services
- Floor covering installation
- Noncontractual garbage removal
- Home repairs (except residential heating systems)
- Gift wrapping
- Information services
- Investigation and detective services
- Jewelry cleaning, engraving and sizing
- Landscaping services
- Laundry services (except for clothing)
- Lawn mowing services
- Locker rentals
- Mail processing services for advertising promotional material distributed in NJ
- Maintenance agreements (in general)
- Manufacturer’s rebate (automobile, etc.)
- Massage services (except for those provided pursuant to doctor’s prescription)
- Membership fees to health/fitness/athletic/sporting clubs and shopping clubs
- Parking, storing or garaging a motor vehicle
- Pest control treatment
- Photocopying services
- Photographer’s services
- Prewritten computer software delivered electronically and sold to individuals
- Printing services
- Restaurant meals
- Safe deposit box rental
- Scanning photos, records, etc.
- Security guard and patrol services
- Security systems services
- Service contracts (in general)
- Silk-screening, monogramming, embroidering (services only – exempt if purchase of clothing included)
- Snow removal
- Space for storage
- Storage service charges
- Tanning sessions
- Tattooing
- Telecommunication services
- Telephone answering services
- Trash removal (non-contractual)
- Utilities (natural gas, electricity)
- Videography
- Window washing
Please keep in mind that this is a guideline, and you should consult with a sales tax professional to determine if the services your business provides should be subject to state sales tax. For an in-depth look at New Jersey sales tax, TaxJar’s guide to sales tax in New Jersey and the New Jersey Division of Taxation has more details.
