New Jersey's Sales Tax Rate and What It Covers
New Jersey charges a 6.625% state sales tax on most goods and services you buy in the state. This is the base rate that applies statewide. Some counties add an additional tax on top of this — called a local option sales tax — which ranges from 0% to 1.125% depending on where you live, bringing your total to somewhere between 6.625% and 7.75%.
The tax applies when you purchase tangible items like clothing, electronics, furniture, and groceries (with some exceptions). It also applies to many services, including haircuts, car repairs, and dry cleaning. You pay sales tax at the register or on your receipt — the seller collects it and sends it to the state.
Key Takeaways
- New Jersey's base state sales tax is 6.625%, and your county may add 0% to 1.125% more depending on where you live.
- Groceries, prescription medications, and certain medical equipment are exempt from sales tax in New Jersey.
- Clothing and footwear under $110 per item are tax-free, but items over that threshold are taxed.
- Services like haircuts, repairs, and professional fees are subject to sales tax, unlike in some other states.
- Online purchases from out-of-state sellers may or may not have sales tax added, depending on the seller's location and New Jersey's rules.
Which County You Live In Affects Your Total Rate
Your actual sales tax rate depends on your county. Bergen County, Essex County, Hudson County, and Union County each charge different local rates on top of the 6.625% state tax. For example, Bergen County adds 0.625%, making the total 7.25%, while some other counties add less or nothing at all.
When you shop, the tax you see on your receipt reflects both the state rate and your local county rate combined. If you move between counties or shop in a different county, the rate changes. You can find your specific county rate by checking the New Jersey Division of Taxation website or asking a local retailer.
What Is Exempt From Sales Tax
Not everything you buy is taxed. Groceries — food you prepare at home like milk, bread, vegetables, and meat — are completely exempt. Prescription medications and certain medical devices like diabetic testing supplies are also tax-free. Over-the-counter medicines like aspirin and cold medicine, however, are taxed.
Clothing and footwear under $110 per item are exempt from tax. This means a $50 shirt is tax-free, but a $150 jacket is taxed. The $110 threshold applies per item, not per purchase. Accessories like belts, hats, and gloves are taxed regardless of price.
Services that are exempt include certain medical and dental services, haircuts at some establishments, and labor on repairs in specific situations. However, the rules for services are complex — a haircut at a salon is taxed, but a barber's haircut may not be, depending on the specific business classification. When in doubt, ask the business before you pay.
How Sales Tax Works on Services
Unlike groceries or clothing, most services in New Jersey are taxable. When you get a haircut, have your car repaired, or hire a plumber, you pay sales tax on the labor and materials. This is different from some states that do not tax services at all.
Professional services like accounting, legal information, and consulting are generally not taxed. But personal services like nail salons, massage therapy, and fitness training are taxed. The distinction can be confusing — if you are unsure whether a service you are paying for is taxed, ask the business directly before the work begins.
Sales Tax on Online and Out-of-State Purchases
If you buy something online from a large retailer like Amazon or a national chain, you usually pay New Jersey sales tax at checkout if the seller has a physical presence in the state or meets certain sales thresholds. Smaller online sellers may not collect tax, but you are technically responsible for paying it yourself through a "use tax" — though most people do not.
If you order from a seller outside New Jersey and no tax is charged, you are not required to track it down and pay it yourself as an individual. The use tax is primarily enforced for business purchases. However, if you are buying from a major retailer, the tax is almost always collected automatically at the time of purchase.
Understanding Your Receipt and Tax Calculation
When you look at your receipt, the sales tax is listed as a separate line item. To understand how it was calculated, multiply your subtotal by your local tax rate. For example, if you spend $100 in Bergen County (7.25% total tax), you pay $7.25 in tax for a total of $107.25.
Some items on the same receipt may be taxed differently. A grocery bag containing milk (tax-free), a shirt under $110 (tax-free), and a magazine (taxed) will show tax only on the magazine. This is why your tax amount may not match a straightforward calculation of the total subtotal — the store is explore the correct rate to each item based on what it is.
Frequently Asked Questions
Do I pay sales tax on groceries in New Jersey?
No. Food you buy to prepare at home — including milk, bread, vegetables, meat, and frozen meals — is exempt from sales tax. However, prepared food from a deli counter, restaurant, or food truck is taxed. The difference is whether you are buying ingredients to cook or a meal ready to eat.
Is clothing always tax-free in New Jersey?
Clothing and footwear under $110 per item are tax-free. Items over $110 are taxed. This applies per item, so a $200 coat is taxed, but two $50 shirts are not. Accessories like belts, scarves, and hats are taxed regardless of price.
What is the difference between state and local sales tax?
The state charges 6.625% on all taxable purchases. Your county adds an additional local tax on top of that, ranging from 0% to 1.125%. Both are collected together at the register, so you see one combined rate on your receipt.
Do I have to pay sales tax on services like haircuts?
Most personal services in New Jersey are taxed, including haircuts, nail services, and car repairs. Professional services like accounting or legal information are usually not taxed. If you are unsure, ask the business before you pay.
Why is my online purchase taxed differently than my in-store purchase?
Large online retailers collect New Jersey sales tax if they have a physical location in the state or meet sales thresholds. Smaller sellers may not collect tax. The rate should be the same as in-store if tax is collected — it is based on your delivery address, not the seller's location.