Trenton, NJ – A newly introduced bill in the New Jersey Assembly would repeal the state’s corporate transit fee, ending a 2.5 percent surtax on large corporations that was enacted last year to help fund NJ Transit’s operations and capital projects.
Assemblymen Christopher P. DePhillips and Al Barlas, both Republicans from District 40, sponsored the measure, Assembly Bill 6007, which would immediately abolish the Corporate Transit Fee established under P.L.2024, c.20. Assemblywoman Dawn Fantasia co-sponsored the legislation.
If enacted, the repeal would apply to all corporate business tax (CBT) privilege periods beginning on or after the bill’s effective date.
Corporate transit fee targeted for repeal
The Corporate Transit Fee currently applies to companies with more than $10 million in New Jersey–allocated taxable net income. Enacted in 2024, it was intended as a temporary surtax through 2028 to generate dedicated funding for NJ Transit’s operating and federal matching obligations.
The fee, which took effect for tax years starting January 1, 2024, serves as a continuation of the previous corporate business surtax that expired in 2023. State officials projected the measure would generate hundreds of millions of dollars annually to stabilize the financially strained transit agency.
Sponsors call fee harmful to business climate
DePhillips and Barlas argue that repealing the transit fee is necessary to improve New Jersey’s competitiveness and attract business investment. Critics of the surtax say it places an undue burden on corporations already paying among the highest business taxes in the country.
Supporters of the original law contend that eliminating the fee could worsen NJ Transit’s budget gap and threaten service levels, as the agency relies on the revenue to fund operations and qualify for federal infrastructure matching funds.
Immediate effect if enacted
Under the bill, taxpayers would no longer owe the corporate transit fee for any privilege period beginning on or after the date the law is enacted. All provisions of the 2024 statute establishing the fee would be repealed in full.
The measure’s introduction sets the stage for renewed debate over balancing New Jersey’s economic competitiveness with its transportation funding needs—a recurring challenge as NJ Transit faces rising costs and declining fare revenue.
Key Points
- Bill would repeal the 2.5% Corporate Transit Fee on corporations earning over $10 million.
- Fee revenue currently funds NJ Transit’s operating and capital expenses.
- Repeal would take effect immediately for future tax periods if enacted.