New Jersey tax collections running ahead of projections despite mixed revenue trends

TRENTON, N.J. — New Jersey’s major tax collections remained slightly ahead of projections through May, with revenues boosted by strong income tax receipts and timing-related increases in sales tax collections, according to a report released Friday by the state Department of the Treasury.

The Treasury Department reported that May collections for the state’s major taxes totaled $3.646 billion, an increase of $951.5 million, or 35.3%, compared with May 2025. Fiscal year-to-date collections reached $43.864 billion, up $2.721 billion, or 6.6%, from the same period last year.

State officials said the sharp increase in May was largely due to an unusually low comparison from the previous year. Certain payment delays allowed during the first phase of the New Jersey Tax System upgrade temporarily shifted the timing of collections in 2025, particularly affecting sales tax revenues.

The Sales and Use Tax, the state’s largest General Fund revenue source, generated $1.112 billion in May, up $221.5 million, or 24.9%, from a year earlier. Fiscal year-to-date collections totaled $11.634 billion, a 4.9% increase over last year and above the state’s projected growth rate of 3.7%.

Gross Income Tax collections, which support the Property Tax Relief Fund, totaled $1.111 billion in May, an increase of $158.8 million, or 16.7%. Year-to-date collections reached $19.626 billion, up 9.3% and ahead of the state’s projected annual growth rate of 7.7%.

The Corporation Business Tax, however, continued to lag. May collections totaled $151 million, down $61.3 million, or 28.9%, from a year ago. Fiscal year-to-date collections of $2.949 billion were down 25.1% from last year, driven largely by increased refunds and weaker estimated payments.

Insurance Premiums Tax collections totaled $263.2 million in May, a decline of 11.6% from the same month last year. Despite the monthly decline, year-to-date collections remained up 9.3%.

Realty Transfer Fee revenues also fell in May, totaling $42.7 million, down 9.3% from a year earlier. Treasury officials attributed the decline to lower property sales activity, which has offset rising home prices in recent months.

Despite some weaker tax categories, overall state revenues remain modestly ahead of projections as New Jersey approaches the end of the fiscal year on June 30.