Limo service sales tax exemption bill opposed

TRENTON – The state Sales and Use Tax Review Commission voted 6-0 in opposition to proposed legislation that would grant sales tax exemption to limousine services.

The bills, A1328/S724, involve a topic that has been before the commission in previous legislative sessions.

Jeff Shanker, vice president of A-1 Limousine in Princeton, said that since the sales tax hike in 2006 one-third of New Jersey’s limo businesses have ceased to exist, costing 7,000 jobs.

He said the business faces competition from Pennsylvania limo services that enter New Jersey and don’t charge the sales tax, as well as from former in-state limo operators who have switched to taxis that don’t charge sales tax.

There was a difference of opinion on how much the sales tax has raised.

Shanker said that it has raised $3 million to $4.5 million, but Commission staff said it has raised a total closer to original projections of $27 million, and the Office of Economic Analysis estimated passage of this bill would cost the state $21.7 million a year.

The Commission voted in 2010 not to recommend a similar bill for passage.

Limo service sales tax exemption bill opposed