New Jersey’s $58.8B Budget Includes Some Tax Increases

Late on June 30, Governor Murphy signed New Jersey’s FY26 budget. At $58.78 billion, it is the state’s largest-ever budget. Here’s a summary of some of the main budget items:

• 4% increase in annual spending
• $1.5 billion structural spending gap
• Increase in realty transfer fee for residential and commercial properties: 2% for sales between $2 million and $2.5 million and .05% for every additional $500,000; capped at 3.5%; payable by the seller
• Increase in tax for online gambling and sports betting to 19.75%
• Increase in tax for cigarettes from $2.70 to $3 per pack and liquid nicotine from 10 cents per fluid milliliter to 30 cents
• New exemption for small business investment and reforms to the Angel Investor Tax Credit
• Nearly $4.3 billion in direct property tax relief, including $2.4 million for the ANCHOR program and $239 million for the Senior Freeze program
• $600 million for StayNJ, which is expected to launch for the 2025 tax season and will reimburse eligible seniors for up to 50% of their property tax bills
• Nearly $2 billion for infrastructure: state and local highway and bridge projects and NJ TRANSIT fleet modernization
• $7.2 billion full payment to the public workers’ pension system
• $12.1 billion for K-12 school aid

See also:

• Governor Murphy’s press release about the budget
• Murphy signs NJ’s largest state budget (NJSpotlightNews)
• Democrats add hundreds of millions to budget for pet projects (NJSpotlightNews)
• Coming on July 15: IssuesWatch Podcast on the budget with NJCPA’s Jeff Kaszerman and NJBIA’s Chris Emigholz