TRENTON, NJ -- Governor Phil Murphy took action on Friday to ease the tax burden on "transient accommodations" enacted last summer. The revised law provides relief for many shore renters by narrowing the scope of rentals that are subject to taxation.
In a press release, Murphy explained that the new law "more closely mirrors the original intent, which was to create parity throughout the rental industry by extending the existing tax on hotels and motels to certain short-term rentals, such as those done through online marketplaces."
"Our shore economy adds tremendous vitality and dynamism to New Jersey," said Governor Murphy. "Access to affordable rental properties for visitors and income on rentals for homeowners are the backbone of that economy. Our public policies must be well-calibrated to allow this economy to thrive and grow."
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Assemblyman Wayne DeAngelo was among a group of lawmakers to craft the law.
"Summer tourism is the heartbeat of the shore, and this law was never intended to hurt the private homeowners who help it grow and thrive," said DeAngelo (D-Hamilton) "The bill signed into law today will help property owners who rely on word of mouth, signs, social media and longstanding customers to keep their rentals booked through the summer. It will help shore businesses keep customers flocking to their doors. And it will help tourists afford to have the vacation of their dreams right here at the Jersey Shore."
The revised law limits the scope of transient accommodations that are considered taxable under the law to apply only to rentals of professionally managed units and rentals obtained through a transient space marketplace or travel agency, under certain circumstances. Rentals that a homeowner facilitates directly, such as through local newspaper ads, personal referrals, or signage, will not be subject to the tax if the homeowner is collecting the rental payment themselves.
"As the 7th-largest employer in New Jersey, tourism has always been one of the Jersey Shore's flagship enterprises," said Senator Vin Gopal (D-Monmouth). "At a time of year when business should be booming, local homeowners have been struggling to fill rental slots for summer visitors. A bad summer at the shore could have a damaging ripple effect across our State's entire economy, which is why this reform works to protect our traditional rental markets from the harmful provisions of this new tax, ensuring a brighter future for summer rentals up and down the coast."
The revised law takes effect immediately.
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