End taxes on energy bills? NJ lawmakers push plan to lower costs

🔴 Two senators propose suspending utility taxes to ease ratepayer pain.

🔴 Electric rates jumped up to 20% in June, boosting state tax revenue.

🔴 Gov. Murphy opposes the bill, saying the charges fund critical programs.

In an attempt to spare New Jersey ratepayers who are facing massive utility costs, two lawmakers are pushing a solution that Gov. Murphy opposes.

The bill (S4765) would suspend both the Societal Benefits Charge and the sales and use tax on utility bills for 2026.

It's in response to electric rate hikes of 17-20% that took effect June 1. Those striking hikes will also lead to a big increase in tax revenue for the state. Collections from utility bills are expected to increase 15.7%, or nearly $166 million, from the year before.

Republican senators push tax suspension to lower bills

The legislation was introduced last week by Sens. Latham Tiver, R-Burlington, and Joe Pennacchio, R-Morris.

“New Jersey has an affordability crisis, and our plan puts taxpayers first by suspending unnecessary sales tax and SBC collections for the entire year of 2026," Tiver said.

On average, each household would save between $170 and $233 on its electric bill and between $178 and $308 on its gas bill, according to the legislative text.

Gov. Murphy defends charges as essential funding sources

If the plan sounds familiar, that's because the senators introduced a similar bill back in May. The Republican-backed bill never came up for a vote in the state legislature.

If the bill had come up for a vote and passed, Gov. Phil Murphy would have likely vetoed it.

Get our free mobile app

He defended the sales and use tax and the SBC during an appearance on News 12 New Jersey's monthly Ask Gov. Murphy program.

"Those are two legitimate sources for the BPU and for the state that we use to do all sorts of good for the energy dependency and affordability in the state," Murphy said.

What is the Societal Benefits Charge?

The SBC makes up around 3% of a ratepayer's electric bill, according to the state Board of Public Utilities. It was implemented in 1999.

As its name suggests, the Social Benefits Charge goes toward low-income assistance, social programs, clean energy programs, and the remediation of gas plant sites.

Report a correction 👈 | 👉 Contact our newsroom