Eliminates the corporate transit fee.

2026-2027 Regular Session Introduced by Al Barlas and 5 co-sponsors

The bill repeals the Corporate Transit Fee and its 2.5% surtax, removing a revenue stream for NJ Transit effective immediately and applying to periods after enactment.

Introduced, Referred to Assembly Transportation and Independent Authorities Committee

Summary of Bill A-2703 (Session 222, New Jersey)

Purpose and intent

The bill eliminates the Corporate Transit Fee (CTF) currently imposed on certain Corporate Business Tax (CBT) taxpayers in New Jersey.

It repeals the statutory provision establishing the CTF and eliminates the additional 2.5% surtax on CBT taxpayers with New Jersey allocated taxable net income above $10 million for specified privilege periods.

The CTF was in effect for privilege periods beginning January 1, 2024 through December 31, 2028 and was intended to support New Jersey Transit (NJ Transit) operations and to fund the state’s required matching funds for federal capital projects.

Key provisions and changes

Repeal of the Corporate Transit Fee: Section 1 of P.L.2024, c.20 (C.54:10A-5.41a) is repealed.

Immediate effective date: The act takes effect immediately upon enactment.

Retroactive application to privilege periods: Applies to privilege periods beginning on or after the date of enactment.

Financial impact targeted by repeal: By removing the CTF, CBT taxpayers would no longer owe the 2.5% surtax on top of their regular CBT liability for eligible periods impacted by the repeal.

Who/what would be affected

CBT taxpayers meeting the threshold (New Jersey allocated taxable net income > $10 million) that were subject to the Corporate Transit Fee.

State finances and funding streams related to NJ Transit and federal capital funding matching requirements, since the CTF revenue was earmarked for those purposes beginning in Fiscal Year 2026.

Procedural and timeline aspects

Legislative action history: Introduced on January 13, 2026; referred to the Assembly Transportation and Independent Authorities Committee.

Enactment timeline: The bill provides an immediate effective date upon enactment, with applicability to privilege periods beginning on or after enactment.

Revenue allocation implication: Starting in Fiscal Year 2026, revenues from the CTF were required to be appropriated annually to NJ Transit operating expenses and to fund the state’s matching funds for federal capital projects. The bill removes that revenue stream by repealing the fee.

Practical implications

For affected corporations, a potential reduction in tax liability equal to 2.5% of the CBT portion attributable to the CTF for applicable privilege periods.

Over time, state revenue intended to support NJ Transit operations and federal matching funds would be restored or rebalanced through the repeal, though the bill does not specify alternate funding mechanisms.

Administrative impact would include the removal of the CTF calculations from CBT filings and related reporting requirements.

If you’d like, I can add a side-by-side comparison of the current law versus the bill’s changes, or provide a brief fiscal note-style outline of potential revenue and expenditure effects based on available data.