On March 26, Governor Phil Murphy signed a bill that will raise New Jersey's gas tax by 10 cents starting in July. The increase will continue annually in increments over the next five years. The governor and legislative majorities stated that the hikes are necessary to replenish the state's Transportation Trust Fund, which finances maintenance and repairs for roads, highways, bridges, tunnels, railroads, and potholes.
The new gas tax will rise approximately two cents each year for five years. Additionally, an annual registration fee for electric vehicles will begin at $250 in July and increase by $10 annually through July 2028.
The National Federation of Independent Business (NFIB) strongly opposed these tax increases. They noted that when New Jersey last changed the gas tax, it went from being the second-lowest in the nation to one of the highest rates. "Unfortunately," they stated, "the legislation was fast-tracked by the leadership in the Senate and Assembly."
State Director Eileen Kean argued that New Jersey motorists already pay one of the highest gas taxes in the nation at 42.3 cents per gallon of gasoline. She said a hike of 10 cents is another burden on small businesses that are already heavily taxed. "Post pandemic," she explained, "Main Street businesses continue to struggle to keep their doors open with already the most expensive business climate in the country."
While NFIB supports maintaining roadway safety as vital to the economy, they believe New Jersey had an adequate funding mechanism for its Transportation Trust Fund before increasing taxes. Kean suggested NJ Transit should have been independently assessed before imposing additional taxes on small businesses and motorists due to NJ Transit's financial needs.
