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Division of Taxation

Notice to All Natural Gas Vendors

All retail sales of natural gas (*) delivered in New Jersey to non-exempt customers must include the 6.625% New Jersey Sales Tax. The law requires that the Sales Tax be included in the customer's rate.

Charges for utility service (**) provided and usually billed by New Jersey's public utility energy companies also are subject to the 6.625% New Jersey Sales Tax. (These charges have been fully subject to New Jersey Sales Tax since January 1, 1998.) The law also requires that the 6.625% Sales Tax on these transportation charges be included in the customer's rate by the billing company. The vendor can’t state the tax as a separate line item on the bill.

The exemption for purchases of natural gas and utility service by the following customer classes remains in effect:

  1. Utility corporations or persons that were subject to the provisions of P.L.1940, c. 4 (N.J.S.A. 54:30A-16 et seq.) as of April 1, 1997, or were formerly or are currently subject to the provisions of P.L.1940, c. 5 (N.J.S.A. 54:30A-49 et seq.). Exempt Use Certificate (ST-4) must be provided to vendor.
  2. Co-generators in operation, or which filed an application for an operating permit or a construction permit and a certificate of operation in order to comply with air quality standards under P.L.1954, c. 212 (C.26: 2C-1 et seq.) with the New Jersey Department of Environmental Protection, on or before March 10, 1997. [Exempt Use Certificate (ST-4) must be provided to vendor]
  3. Special contract customers for which a customer-specific tax classification was approved by a written order of the New Jersey Board of Public Utilities prior to January 1, 1998.
  4. Agencies or instrumentalities of the federal government.
  5. International organizations of which the United States of America is a member.
  6. Cemetery companies, pursuant to N.J.S.A 8A: 5-10. Exempt Use Certificate (ST-4) must be provided to vendor.
  7. Amtrak (National Railroad Passenger Corporation).
  8. Limited Dividend Housing Corporations organized under N.J.S.A. 55:16-1 et seq., for use at the qualified housing project. Exempt Use Certificate (ST-4) must be provided to vendor.

REMINDER: There is no exemption available for purchases of natural gas and utility service by state and local governments, qualified Urban Enterprise Zone businesses, and qualified exempt organizations such as schools, churches, nursing homes, etc. There is also no exemption for purchases of natural gas and utility service for use in the manufacturing process.

If you have any questions, please contact Customer Service Center at 609-292-6400.

(*) Natural Gas means any gaseous fuel distributed through a pipeline system.

(**) Utility service means the transportation or transmission of natural gas or electricity by means of mains, wires, lines or pipes, to users or customers.


Last Updated: Friday, 04/24/20