New Jersey February 2025 Revenue Report: Major Taxes Show Positive Growth

The Department of the Treasury has reported impressive figures for February 2025, with major tax revenues totaling $3.180 billion, representing an increase of 13.5% over the same period last year. This robust growth can be attributed to a combination of lower refund payouts and increased collections in critical tax categories like the Gross Income Tax (GIT) and the Corporation Business Tax (CBT). The results are promising, reinforcing New Jersey’s fiscal health as the state approaches its end-of-year revenue targets.

Key Highlights:

1. Overall Revenue Growth:
   The state’s total major revenues for February amounted to $3.180 billion, marking an increase of $378.5 million compared to the previous year. This growth aligns closely with fiscal year projections and reflects positive trends in various revenue streams. Year-to-date, the state’s total major revenues have reached $27.112 billion, which is $1.050 billion higher than the previous year — a 4.0% increase.
2. Gross Income Tax (GIT):
   February saw a 13.2% increase in GIT collections, bringing in $1.454 billion for the month. This surge is attributed to higher employer withholding collections and a reduction in refunds, with many Tax Year 2024 refunds being issued in early March instead of the end of February, as seen in the previous year. GIT remains the largest source of funding for the Property Tax Relief Fund, and year-to-date collections stand at $11.650 billion, an 8.3% increase over last year.
3. Sales and Use Tax (SUT):
   The Sales and Use Tax (SUT), New Jersey’s largest General Fund revenue source, continued to show positive growth, with $953.8 million collected in February — a 5.9% increase over February 2024. However, the growth rate is slightly inflated due to a shift in cannabis tax revenue, which had been recorded in February 2024 but will be processed in March 2025. Excluding this shift, the SUT would have grown by a more modest 3.9%. For the year, SUT collections are up by 3.6%, totaling $7.963 billion.
4. Corporation Business Tax (CBT):
   The Corporation Business Tax (CBT) saw a sharp 118.7% increase in February, bringing in $21.0 million, up from $9.6 million in February 2024. This growth was largely driven by lower refund issuance, with a marked reduction in the volume of refunds processed. However, year-to-date CBT collections are down 5.4%, totaling $2.250 billion, as collections were impacted earlier in the year. Experts remain optimistic about a stronger second half for CBT, with Corporate Transit Fee collections expected to bolster the numbers in the coming months.
5. Insurance Premiums Tax (IPT):
   Insurance Premiums Tax (IPT) collections showed a 12.9% decrease in February, totaling $256.1 million. This decline is largely attributed to delayed refund processing, as well as the influence of tax credits from prior years. Year-to-date, IPT collections are down by 45.1%, totaling $161.8 million. This drop highlights the impact of refund delays and the fluctuation in tax credits issued.
6. Petroleum Products Gross Receipts Tax (PPGRT):
   The Petroleum Products Gross Receipts Tax (PPGRT) increased by 16.4%, with collections totaling $130.2 million in February. This growth was in part due to a rate increase that took effect on January 1, 2025. The 2.6-cent rate increase on petroleum products resulted in higher receipts, and year-to-date collections are up by 3.3%, reaching $881.9 million.
7. Realty Transfer Fee (RTF):
   A notable 41.1% increase was reported in Realty Transfer Fee (RTF) collections, which amounted to $49.0 million for February. This significant uptick is reflective of the ongoing strength in the real estate market, with elevated median home prices supporting revenue growth. Year-to-date, RTF collections have grown by 16.9%, totaling $309.8 million.

Looking Ahead:

Despite a few fluctuations in specific tax categories, February’s revenue performance positions New Jersey well to meet its Fiscal Year 2025 goals. February’s gains in GIT, SUT, and CBT, along with the positive performance in property-related taxes, suggest continued growth and fiscal stability for the remainder of the year.

The Treasury Department’s proactive approach in addressing tax issues, along with lower refund activity and increased collection efficiency, has helped maintain a healthy revenue base. With corporate taxes expected to improve in the second half of the year, Treasury officials are confident that New Jersey is on track to meet its target of $36.3 billion in total tax revenue for the year.

In Conclusion:

February 2025 marked a strong start for New Jersey’s fiscal year, with key tax categories showing robust performance. The Department of the Treasury will continue to monitor trends and adjust strategies to ensure that state revenues remain on target throughout the remainder of the year. With continued fiscal discipline and a strategic approach to revenue collection, New Jersey’s 2025 fiscal outlook looks promising, setting a solid foundation for the state’s economic future.

For more detailed information on monthly and year-to-date revenue collections, please refer to the attached chart and visit the Department of the Treasury’s official website.

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