TRENTON, NJ – If taxes are your number one concern, buying an EV in the Garden State might not be for you. Despite New Jersey Governor Phil Murphy’s push to a gas-less vehicle economy in 2035, a new surcharge, an expired tax, and increased sales taxes are on the near horizon.
It’s not exactly the best way to promote your anti-global warming agenda that hinges on people ditching their gasoline-powered cars.
The state of New Jersey has announced changes to its taxation policies on electric vehicles (EVs).
Previously, EV purchases were exempt from state sales tax, but starting from October 1, 2024, this exemption will begin to phase out. Initially, EV purchases will be taxed at a rate of 3.3125%.
This rate is set to increase to the full state sales tax rate of 6.625% by July 1, 2025.
Additionally, New Jersey has implemented a new registration fee for electric vehicles, which also took effect this year. This fee is collected upfront for the expected duration of the vehicle’s registration, adding an additional cost to EV owners.
These changes are part of broader fiscal adjustments by the state to increase revenue through various streams, including adjustments in automotive sales and usage, to help balance the state’s budget, this time on the backs of EV drivers.
These measures are expected to impact the cost of new EVs significantly, potentially increasing the overall expense by several thousand dollars over the next few years as the new taxes take full effect.
