Latest News

New Tire Tax To Take Effect August 1, 2004

Jul 06, 2004

The Legislature worked late into the night on Thursday, June 24, approving almost 400 individual actions and pieces of legislation.Among them was a bill which was fast-tracked through the legislative process, imposing a “fee” (a tax by any other name) on the sale of new tires.This fee will apply to tires sold as original equipment on new motor vehicles in addition to new tires sold over-the-counter.The definition of “tire” for purposes of this fee appears to include even “doughnuts” and emergency tires included with a new vehicle. This fee is intended to create a fund to be used to clean up abandoned tire dumps, with any excess funds being dedicated for snow removal. Dealerships will be responsible for collecting this fee for all tires sold.The law specifically authorizes tire sellers to collect this fee from buyers, as with the sales tax.The Division of Taxation can be expected to issue forms and instructions for how this fee will be reported and remitted.The rules governing collection and exemptions from this fee are the same as for the State sales tax, so it is likely that the procedures for reporting will be similar to those for the sales tax (i.e., the tire tax will not apply to a vehicle sold to a non-resident or to a tax-exempt entity). The Director of the Division of Taxation is authorized to adopt emergency regulations to implement this new fee, which will take effect on August 1, 2004.NJ CAR will notify members of the regulations and the procedures for collecting, reporting, and remitting this fee as soon as they are issued.