Concerns applicability of sales tax to certain horse-boarding charges in New Jersey.

A1267

ASSEMBLY, No. 1267

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblyman MICHAEL INGANAMORT

District 24 (Morris, Sussex and Warren)

Assemblyman DAVID BAILEY, JR.

District 3 (Cumberland, Gloucester and Salem)

Assemblywoman DAWN FANTASIA

District 24 (Morris, Sussex and Warren)

Co-Sponsored by:

Assemblymen Scharfenberger, Auth, Barlas, Clifton,
Sauickie, Myhre and Assemblywoman Peterpaul

SYNOPSIS

���� Concerns applicability of sales tax to certain
horse-boarding charges in New Jersey.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act
concerning the sales tax applicability to certain
charges by horse-boarding businesses in New Jersey and amending and
supplementing P.L.1966, c.30.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� Section 3 of P.L.1966,
c.30 (C.54:32B-3) is amended to read as follows:

���� 3.��� There is imposed and
there shall be paid a tax of 7% on or before December 31, 2016, 6.875% on and
after January 1, 2017 but before January 1, 2018, and 6.625% on and after
January 1, 2018 upon:

���� (a)�� The receipts from every
retail sale of tangible personal property or a specified digital product for
permanent use or less than permanent use, and regardless of whether continued
payment is required, except as otherwise provided in P.L.1966, c.30 (C.54:32B-1
et seq.).

���� (b)�� The receipts from every
sale, except for resale, of the following services:

���� (1)�� Producing, fabricating,
processing, printing, or imprinting tangible personal property or a specified
digital product, performed for a person who directly or indirectly furnishes
the tangible personal property or specified digital product, not purchased by
the person for resale, upon which these services are performed.

���� (2)�� Installing tangible
personal property or a specified digital product, or maintaining, servicing,
repairing tangible personal property or a specified digital product not held
for sale in the regular course of business, whether or not the services are
performed directly or by means of coin-operated equipment or by any other
means, and whether or not any tangible personal property or specified digital
product is transferred in conjunction therewith, except (i) such services
rendered by an individual who is engaged directly by a private homeowner or
lessee in or about his residence and who is not in a regular trade or business
offering his services to the public, (ii) such services rendered with respect
to personal property exempt from taxation hereunder pursuant to section 13 of
P.L.1980, c.105 (C.54:32B-8.1), (iii) (Deleted by amendment, P.L.1990, c.40),
(iv) any receipts from laundering, dry cleaning, tailoring, weaving, or
pressing clothing, and shoe repairing and shoeshining, and (v) services
rendered in installing property which, when installed, will constitute an
addition or capital improvement to real property, property or land, other than
landscaping services and other than installing carpeting and other flooring,
and other than sign installation services.

���� (3)�� Storing all tangible
personal property not held for sale in the regular course of business; the
rental of safe deposit boxes or similar space; and the furnishing of space for
storage of tangible personal property by a person engaged in the business of furnishing
space for such storage.

���� "Space for storage"
means secure areas, such as rooms, units, compartments, or containers, whether
accessible from outside or from within a building, that are designated for the
use of a customer and wherein the customer has free access within reasonable
business hours, or upon reasonable notice to the furnisher of space for
storage, to store and retrieve property.� Space for storage shall not include
the lease or rental of an entire building, such as a warehouse or airplane
hangar
, or the lease or rental of a stall in a barn, stable, or other
similar structure or facility for the boarding or stabling or for the keeping
or holding of a horse, pony, mule, donkey, or hinny
.

���� (4)�� Maintaining, servicing,
or repairing real property, other than a residential heating system unit
serving not more than three families living independently of each other and
doing their cooking on the premises, whether the services are performed in or
outside of a building, as distinguished from adding to or improving the real
property by a capital improvement, but excluding services rendered by an
individual who is not in a regular trade or business offering his services to
the public, and excluding garbage removal and sewer services performed on a
regular contractual basis for a term not less than 30 days.

���� (5)�� Mail processing services
for printed advertising material, except for mail processing services in
connection with distribution of printed advertising material to out-of-State
recipients.

���� (6)�� (Deleted by amendment,
P.L.1995, c.184)

���� (7)�� Utility service provided
to persons in this State, any right or power over which is exercised in this
State.

���� (8)�� Tanning services,
including the application of a temporary tan provided by any means.

���� (9)�� Massage, bodywork, or
somatic services, except such services provided pursuant to a doctor's
prescription.

���� (10)� Tattooing, including all
permanent body art and permanent cosmetic make-up applications, except such
services provided pursuant to a doctor's prescription in conjunction with
reconstructive breast surgery.

���� (11)� Investigation and
security services.

���� (12)� Information services.

���� (13)� (Deleted by amendment,
P.L.2017, c.27)

���� (14)� Telephone answering
services.

���� (15)� Radio subscription
services.

���� Wages, salaries, and other
compensation paid by an employer to an employee for performing as an employee
the services described in this subsection are not receipts subject to the taxes
imposed under subsection (b) of this section.

���� Services otherwise taxable
under paragraph (1) or (2) of subsection (b) of this section are not subject to
the taxes imposed under this subsection, where the tangible personal property
or specified digital product upon which the services were performed is
delivered to the purchaser outside this State for use outside this State.

���� (c)�� (1)� Receipts from the
sale of prepared food in or by restaurants, taverns, or other establishments in
this State, or by caterers, including in the amount of such receipts any cover,
minimum, entertainment, or other charge made to patrons or customers, except
for meals especially prepared for and delivered to homebound elderly, age 60 or
older, and to persons with disabilities, or meals prepared and served at a
group-sitting at a location outside of the home to otherwise homebound elderly
persons, age 60 or older, and otherwise homebound persons with disabilities, as
all or part of any food service project funded in whole or in part by
government or as part of a private, nonprofit food service project available to
all such elderly or persons with disabilities residing within an area of
service designated by the private nonprofit organization; and

���� (2)�� Receipts from sales of
food and beverages sold through vending machines, at the wholesale price of
such sale, which shall be defined as 70% of the retail vending machine selling
price, except sales of milk, which shall not be taxed.� Nothing herein contained
shall affect other sales through coin-operated vending machines taxable
pursuant to subsection (a) above or the exemption thereto provided by section
21 of P.L.1980, c.105 (C.54:32B-8.9).

���� The tax imposed by subsection
(c) of this section shall not apply to food or drink which is sold to an
airline for consumption while in flight.

���� (3)�� For the purposes of this
subsection:

���� "Food and beverages sold
through vending machines" means food and beverages dispensed from a
machine or other mechanical device that accepts payment; and

���� "Prepared food"
means:

���� (i)��� A.� food sold in a
heated state or heated by the seller; or

���� B.��� two or more food
ingredients mixed or combined by the seller for sale as a single item, but not
including food that is only cut, repackaged, or pasteurized by the seller, and
eggs, fish, meat, poultry, and foods containing these raw animal foods requiring
cooking by the consumer as recommended by the Food and Drug Administration in
Chapter 3, part 401.11 of its Food Code so as to prevent food borne illnesses;
or

���� C.��� food sold with eating
utensils provided by the seller, including plates, knives, forks, spoons,
glasses, cups, napkins, or straws.� A plate does not include a container or
packaging used to transport the food;

provided however, that

���� (ii)�� "prepared
food" does not include the following sold without eating utensils:

���� A.�� food sold by a seller
whose proper primary NAICS classification is manufacturing in section 311,
except subsector 3118 (bakeries);

���� B.��� food sold in an unheated
state by weight or volume as a single item; or

���� C.��� bakery items, including
bread, rolls, buns, biscuits, bagels, croissants, pastries, donuts, danish,
cakes, tortes, pies, tarts, muffins, bars, cookies, and tortillas.

���� (d)�� The rent for every
occupancy of a room or rooms in a hotel or transient accommodation in this
State, except that the tax shall not be imposed upon a permanent resident.

���� (e)�� (1)� Any admission
charge to or for the use of any place of amusement in the State, including
charges for admission to race tracks, baseball, football, basketball or
exhibitions, dramatic or musical arts performances, motion picture theaters,
except charges for admission to boxing, wrestling, kick boxing, or combative
sports exhibitions, events, performances, or contests which charges are taxed
under any other law of this State or under section 20 of P.L.1985, c.83
(C.5:2A-20), and, except charges to a patron for admission to, or use of,
facilities for sporting activities in which the patron is to be a participant,
such as bowling alleys and swimming pools.� For any person having the permanent
use or possession of a box or seat or lease or a license, other than a season
ticket, for the use of a box or seat at a place of amusement, the tax shall be
upon the amount for which a similar box or seat is sold for each performance or
exhibition at which the box or seat is used or reserved by the holder, licensee,
or lessee, and shall be paid by the holder, licensee, or lessee.

���� (2)�� The amount paid as
charge of a roof garden, cabaret, or other similar place in this State, to the
extent that a tax upon these charges has not been paid pursuant to subsection
(c) hereof.

���� (f)�� (1)� The receipts from
every sale, except for resale, of intrastate, interstate, or international
telecommunications services and ancillary services sourced to this State in
accordance with section 29 of P.L.2005, c.126 (C.54:32B-3.4).

���� (2)�� (Deleted by amendment,
P.L.2008, c.123)

���� (g)�� (Deleted by amendment,
P.L.2008, c.123)

���� (h)�� Charges in the nature of
initiation fees, membership fees or dues for access to or use of the property
or facilities of a health and fitness, athletic, sporting, or shopping club or
organization in this State, except for: (1) membership in a club or organization
whose members are predominantly age 18 or under; and (2) charges in the nature
of membership fees or dues for access to or use of the property or facilities
of a health and fitness, athletic, sporting, or shopping club or organization
that is exempt from taxation pursuant to paragraph (1) of subsection (a) of
section 9 of P.L.1966, c.30 (C.54:32B-9), or that is exempt from taxation
pursuant to paragraph (1) or (2) of subsection (b) of section 9 of P.L.1966,
c.30 (C.54:32B-9) and that has complied with subsection (d) of section 9 of
P.L.1966, c.30 (C.54:32B-9).

���� (i)��� The receipts from
parking, storing, or garaging a motor vehicle, excluding charges for the
following: residential parking; employee parking, when provided by an employer
or at a facility owned or operated by the employer; municipal parking, storing,
or garaging; receipts from charges or fees imposed pursuant to section 3 of
P.L.1993, c.159 (C.5:12-173.3) or pursuant to an agreement between the Casino
Reinvestment Development Authority and a casino operator in effect on the date
of enactment of P.L.2007, c.105; and receipts from parking, storing, or
garaging a motor vehicle subject to tax pursuant to any other law or ordinance.

���� For the purposes of this
subsection, "municipal parking, storing, or garaging" means any motor
vehicle parking, storing, or garaging provided by a municipality or county, or
a parking authority thereof.

(cf: P.L.2022, c.97, s.2)

���� 2.��� (New section)� Charges
for storing a horse, pony, mule, donkey, or hinny in a barn, stable, or other
similar structure or facility by a person engaged in the business of boarding
or stabling or otherwise keeping or holding horses, ponies, mules, donkeys, or
hinnies are exempt from the tax imposed pursuant to the �Sales and Use Tax
Act,� P.L.1966, c.30 (C.54:32B-1 et seq.).

���� 3.��� (New section)� Charges
for maintaining or servicing a horse, pony, mule, donkey, or hinny that is
boarded or stabled or that is kept or held in a barn, stable, or other similar
structure or facility by a person engaged in the business of boarding or stabling
or otherwise keeping or holding horses, ponies, mules, donkeys, or hinnies are
exempt from the tax imposed pursuant to the �Sales and Use Tax Act,� P.L.1966,
c.30 (C.54:32B-1 et seq.).

���� 4.��� (New section)�
Notwithstanding the provisions of the �Administrative Procedure Act,� P.L.1968,
c.410 (C.52:14B-1 et seq.), to the contrary, the Director of the Division of
Taxation in the Department of the Treasury may adopt immediately upon filing
with the Office of Administrative Law such rules and regulations as the
director determines to be necessary and appropriate to effectuate the purposes
of P.L.��� , c.��� (C.������� ) (pending before the Legislature as this bill),
which shall be effective for a period not exceeding 360 days following the
effective date of
P.L. , c. (C. ) (pending
before the Legislature as this bill) and may thereafter be amended, adopted, or
readopted by the director in accordance with the requirements of P.L.1968,
c.410 (C.52:14B-1 et seq.).

���� 5.��� This act shall take
effect immediately; provided, however, that sections 1, 2, and 3 shall apply to
taxable years beginning on or after January 1 next following the date of
enactment of this act.

STATEMENT

���� This bill clarifies the sales
tax collection responsibilities of horse-boarding businesses in New Jersey by
providing an exemption from tax for the lease or rental of certain stable
stalls and charges for horse boarding and certain other relate services.

���� Under the bill, the taxable
service of �furnishing space for storage� is redefined to exclude from tax
charges for the lease or rental of certain stable stalls.� The bill provides
that the service of �furnishing space for storage� does not include, and the
taxable service therefore does not apply to, charges for the lease or rental of
a stall in a barn, stable, or other similar structure or facility for the
boarding or stabling or for the keeping or holding of a horse, pony, mule,
donkey, or hinny.

���� The bill exempts from tax
certain charges for boarding a horse.� The bill provides that charges for
storing a horse, pony, mule, donkey, or hinny in a barn, stable, or other
similar structure or facility by a person engaged in the business of boarding
or stabling or otherwise keeping or holding horses, ponies, mules, donkeys, or
hinnies are exempt from the sales tax.

���� The bill also exempts from tax
certain services provided for the care of horses boarded by persons engaged in
the business of boarding horses.� The bill provides that charges for
maintaining or servicing a horse, pony, mule, donkey, or hinny that is boarded
or stabled or that is kept or held in a barn, stable, or other similar
structure or facility by a person engaged in the business of boarding or
stabling or otherwise keeping or holding horses, ponies, mules, donkeys, or
hinnies are exempt from the sales tax.

���� This bill provides that the
tax exemptions established by the bill would apply to taxable years beginning
on or after January 1 next following the bill�s date of enactment.