
New Jersey sales tax nexus transaction threshold on chopping block
The New Jersey Legislature is considering a bill that would eliminate the state’s remote seller sales tax economic nexus transaction threshold.
New Jersey has been enforcing economic nexus for remote sales tax since November 1, 2018. Like other states with an economic nexus law, which is every state with a sales tax, New Jersey provides an exception for remote sellers whose New Jersey sales are below a certain threshold.
Under current law, a remote seller establishes economic nexus with New Jersey if, in the current or prior calendar year, it:
- Has more than $100,000 in gross revenue from sales of tangible personal property, specified digital products, or taxable services delivered into New Jersey; or
- Made 200 or more separate transactions of tangible personal property, specified digital products, or taxable services delivered into New Jersey.
This threshold could change in 2025.
New Jersey poised to cut 200-transactions sales tax rule
Should the Legislature enact Senate Bill 3604, which looks likely, the Garden State will get rid of its 200-transactions threshold at some point in 2025: New Jersey will then only use the $100,000 sales threshold to determine sales tax economic nexus.
Under the most recent version of the bill, the 200-transactions threshold will also cease to apply to the New Jersey corporation business tax (CBT). Currently, a corporation is subject to CBT if it has more than $100,000 in receipts from sources within New Jersey or 200 separate transactions delivered to customers in the state during the calendar year or the corporation’s fiscal year.
New Jersey isn’t the only state to use a transaction threshold for something other than sales and use tax. For remote businesses, Hawaii’s economic nexus standard for net income tax is $100,000 or more in gross income attributable to Hawaii or 200 or more business transactions within Hawaii during the current or preceding calendar year.
A recent article from Bloomberg Tax highlights problems associated with using different nexus standards for different taxes and encourages states to align their nexus laws.
S3604 is set to take effect on the first day of the second month next following the date of enactment. The full fiscal impact of S3604 is unknown, but the Office of Legislative Services expects it would reduce New Jersey’s annual sales tax collections by no more than $6,625 per affected remote seller.
Knowing where you have nexus is still difficult
Sales tax experts generally support getting rid of the remote seller transactions threshold, which can create a sales tax obligation for businesses with a high volume of low-value sales. For some such businesses, the costs of collecting and remitting remote sales tax may exceed the benefit of doing business in the state.
Fourteen states have eliminated their economic nexus transaction thresholds already, most recently Alaska, on January 1, 2025. New Jersey and Utah will likely follow their lead in 2025.
You can find information about each state’s economic nexus threshold in our state-by-state guide to economic nexus laws. And if you’re wondering where you may be most at risk for establishing sales tax nexus, our free sales tax risk assessment can help.

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