NEW JERSEY – With long-term weather forecasts predicting a cold winter ahead and home energy costs escalating dramatically, Senator Joe Pennacchio is working to give New Jersey residents a break with a new bill that would suspend the state sales tax on gas and electricity to heat homes.
“People are hurting financially, and with frigid weather right around the corner, families are worried about how they will be able to keep their homes warm,” said Pennacchio (R-26). “Inflation remains out of control and shows no signs of slowing down, and higher prices for everything from food to clothing to transportation is eating into household budgets at a record pace.
“The big hit, however, will come when people turn on the heat and find out the cost of natural gas is up 25 percent across much of the state,” Pennacchio said.
New gas rates took effect on October 1, after State regulators “approved double-digit rate increases for four gas providers serving millions of customers in the state.”
The most impactful hike, 25 percent, will hit almost 2 million gas customers of PSE&G, the largest utility in New Jersey. Rates will also skyrocket for residents serviced by Elizabethtown Gas, New Jersey Natural Gas, and South Jersey Gas.
“These new rates couldn’t come at a worse time for retirees and families struggling with record cost-of-living increases. The price of everything is going up, and household income cannot keep pace,” Pennacchio said.
“The strategy of a temporary sales tax freeze on home heating bills will send a message to state residents that they aren’t in this alone,” Pennacchio said. “Since he took office five years ago, Governor Murphy has seen fit to increase the budget by more than 40 percent. With that kind of increase, the Administration can surely find a way to ease the burden on the hard-working little guy who just wants his kids to sleep in a warm bed.”
The senator said that in Westchester County New York, residents will be spared sales tax on home energy through the Meteorological winter, from December 1 through February 28.
“Home heating oil and propane used to heat residential homes are exempt from sales tax in New Jersey. In the current economy, when everybody is feeling the pinch, it makes sense to extend the courtesy to the 70 percent of state households that heat with gas, and those who rely on more costly electricity,” Pennacchio said.
An article published by Time on October 3 noted that this winter, heating and energy bills will escalate, “fueled by a global energy crisis and the fastest growing inflation in 40 years.”
“As the price of energy goes up, the State’s sales tax revenue increases. That’s not fair for residents who are struggling to make ends meet,” Pennacchio said. “The State shouldn’t profit from more costly energy prices.”
For families heating with natural gas, the article projects a national increase of up to 34 percent, to an average bill of $952.
Those using electricity could expect a 7 percent increase, with the average cost of the less efficient option climbing to $1,328.