S3708

An Act providing for a partial sales and use tax exemption for certain businesses impacted by certain public highway projects and supplementing Title 54 of the New Jersey Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. A seller that operates a retail business establishment within an impacted municipality shall be entitled to an exemption to the extent of 50 percent of the tax imposed under the "Sales and Use Tax Act," P.L.1966, c.30 (C.54:32B-1 et seq.), provided that the seller is approved by the director pursuant to subsection b. of this section.

b. (1) Before or after the commencement of a public highway project, a seller may apply to the director for the exemption authorized under this section. The application shall be submitted in a form and manner prescribed by the director. The director shall require the seller to submit such documentation as the director deems necessary to verify that the seller operates a retail business establishment within an impacted municipality.

(2) If the director deems that the seller meets the conditions set forth in subsection a. of this section, the director shall issue a written determination to the seller, which determination shall indicate the retail business establishments to which the exemption shall apply and the relief period during which the exemption shall apply.

c. (1) Upon the commencement or completion of a public highway project, the Commissioner of Transportation shall provide written notice to the director attesting to the commencement or completion of the project, as applicable. Within 30 days following the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the commissioner shall provide written notice to the director attesting to each ongoing public highway project within the State.

(2) Within 30 days of receiving the written notice from the commissioner concerning the completion of a public highway project, the director shall provide written notice to each seller for which an exemption has been authorized related to the public highway project, which notice shall indicate that the seller's exemption under this section is terminated, as of the date of receipt of the written notice.

d. As used in this section:

"Commissioner" means the Commissioner of Transportation.

"Director" means the Director of the Division of Taxation in the Department of the Treasury.

"Impacted municipality" means any municipality in which an ongoing public highway project is located.

"Public highway project" means any infrastructure project that involves the construction, improvement, or maintenance of a State, county, or municipal highway, road, bridge, or street, including, but not limited to, the repair or reconstruction of any highway, road, bridge, or street that has suffered serious damage as a result of a natural disaster or catastrophic failure from any external cause.

"Relief period" means the period of time between the date on which a public highway project commences and the date on which the project concludes.

"Retail business establishment" means a small business that maintains a fixed permanent location where goods are exhibited or services are offered, on-site or off-site, on an appointment or walk-in basis. For the purposes of this definition, offered services may include, but shall not be limited to, charter boat services.

2. The Director of the Division of Taxation in the Department of the Treasury shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), rules and regulations to implement the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).

3. This act shall take effect immediately.

STATEMENT

This bill provides for a 50 percent exemption to the sales and use tax in impacted municipalities in which ongoing public highway projects are located.

Specifically, under the bill, a seller is entitled to an exemption to the extent of 50 percent of the tax imposed under the Sales and Use Tax Act, upon approval by the Director of the Division of Taxation (director), if the seller operates a retail business establishment within an impacted municipality during a relief period. To be entitled to the exemption, a seller is required to submit an application to the director to verify that the retail business establishment operates within an impacted municipality.

The bill defines "retail business establishment" as a small business that maintains a fixed permanent location where goods are exhibited or services are offered, on-site or off-site, on an appointment or walk-in basis. A retail business establishment's offered services may include, but are not limited to, charter boat services. "Impacted municipality" is defined as any municipality in which an ongoing public highway project is located. Under the bill, a "public highway project" is any infrastructure project that involves the construction, improvement, or maintenance of a State, county, or municipal highway, road, bridge, or street, including, but not limited to, the repair or reconstruction of any highway, road, bridge, or street that has suffered serious damage as a result of a natural disaster or catastrophic failure from any external cause. "Relief period" means the period of time between the date on which a public highway project commences and the date on which the project concludes.

Upon the commencement or completion of a public highway project, the bill requires the Commissioner of Transportation (commissioner) to provide written notice to the director attesting to the commencement or completion of the project, as applicable. Within 30 days following the bill's effective date, the commissioner is required to provide written notice to the director attesting to each ongoing public highway project within the State. Within 30 days of receiving the written notice from the commissioner concerning the completion of a public highway project, the bill requires the director to provide written notice to each seller for which such an exemption has been authorized indicating that the seller's exemption is terminated, as of the date of receipt of the written notice.