New Jersey Utility Sales Tax Exemption
New Jersey provides a sales and use tax exemption on electricity and natural gas consumed at qualifying manufacturing facilities within Urban Enterprise Zones (UEZs) or Salem County. Qualified manufacturers must employ at least 250 full‑time workers (in UEZs) or at least 50 workers (in Salem County), with at least 50% directly engaged in the manufacturing process. Once approved, the exemption covers both the utility commodity and its transportation or transmission components.
Utility Study Requirement
To support eligibility, businesses should be prepared to document their manufacturing operations and utility usage. This includes:
- Identifying full‑time headcount and percentage of employees engaged in manufacturing at the facility
- Demonstrating exclusive use of electricity and gas for production within the certified site
- Providing verification of UEZ or Salem County certification and approval by NJEDA and Division of Taxation
- Careful documentation is necessary to prove compliance and support exemption claims.
Filing Requirements
To claim the exemption, business must apply for the New Jersey Economic Development Authority (EDA) for UEZ or Salem County certification. Once approved, the EDA notifies the Division of Taxation, which issues an exemption certificate (Form UZ‑6 for UEZ or S‑6 for Salem County). The certification must be provided to utility providers to ensure future billing excludes sales tax on qualifying usage. If sales tax was paid in error on eligible utility usage before certification, businesses may request a refund from the Division of Taxation. Refund claims must include utility bills, the exemption certificate, and supporting documentation verifying eligibility, and must be submitted within the statutory timeframe (typically up to three years).