New Jersey has established 32 Urban Enterprise Zones covering 37 economically distressed cities throughout the State. The Urban Enterprise Zone Authority usually designates about 30% of a city as an Urban Enterprise Zone.

To participate in the Urban Enterprise program, a business must apply to the local Urban Enterprise Authority to become a “qualified business.” Once a business is certified as a qualified business, the certification must be renewed annually.

Some of the benefits to qualified businesses are:

• The right to purchase items, except motor vehicles, and most services without paying sales tax, and
• Corporation Business Tax credits for hiring certain new employees.

Retailers who wish to qualify for the reduced sales tax benefit must apply to the Division of Taxation for the certification that allows them to charge 50% of the current sales tax rate.

The Division of Taxation has recently promulgated requirements for deliveries of purchases made in the zones. View entire text of the requirements.

To obtain more information about Urban Enterprise Zones, view the Urban Enterprise Zone Tax Questions and Answers booklet.