NJ Corporate Transit Fee Under Fire: Lawmaker Proposes Rescinding 2.5% Surcharge and Slashing State Taxes
the staff of the Ridgewood blog
Ridgewood NJ—A new legislative battle is brewing in Trenton over New Jersey’s tax policies and the accountability of the state’s largest transportation agency. Assemblyman Christopher P. DePhillips (R-Bergen), a staunch critic of the state’s high corporate burden, has introduced a bill aimed at rescinding the controversial 2.5% corporate transit fee while simultaneously renewing his demand for a “top-to-bottom audit” of NJ Transit.
The move comes as New Jersey holds the distinction of having the highest corporate tax rate in the nation (a combined base and surtax of 11.5%), a major point of contention for the state’s business community.
The Target: Ending the Corporate Transit Fee
The legislation (A6007) specifically targets the 2.5% corporate transit fee, which applies to approximately 600 businesses earning over $10 million annually. This fee, coupled with other business taxes, continues a cycle of raising taxes on employers.
Assemblyman DePhillips argues that this surcharge is counterproductive and harmful to the state’s economic health:
“While neighboring states are realizing the benefits of lowering their corporate taxes, it’s imperative New Jersey does the same to support a competitive business climate and a healthy economy,” DePhillips stated. “The driving force for this legislation…is to cut the cost of living and doing business in New Jersey.”
The Audit Mandate: Demanding NJ Transit Accountability
Beyond cutting corporate taxes, the core of DePhillips’ argument centers on NJ Transit’s operational inefficiencies and lack of transparency. The Assemblyman insists that the Murphy administration and the agency itself must look internally for waste before relying on increased fees and fares.
As a member of the Assembly Transportation Committee, DePhillips is pushing for a comprehensive audit and bicameral legislative hearings to restore public confidence.
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The Problem: NJ Transit relies heavily on fare revenue (second only to New York’s MTA nationally) and charges some of the highest fares among surveyed commuter railroads.
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The Solution: “What the agency needs in 2026 is a comprehensive audit, a restructuring of operations, and a decade-focused strategy to transform the transportation system. The New Jersey taxpayers and mass transit commuters deserve no less,” DePhillips asserts.
Fighting High Costs on Two Fronts
DePhillips has also introduced legislation to shield both businesses and commuters from rising costs:
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Corporate Tax Reduction (A1331): A measure to gradually lower the state’s corporate business tax rate to a competitive 2.5% over four years.
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Fare Increase Freeze (A5569): A bill to protect commuters from the automatic annual 3% fare increases that began in July 2025 (on top of the 15% hike that took effect in July 2024).
The legislative push underscores a growing political appetite to challenge New Jersey’s reputation as one of the most expensive states for both residents and businesses.
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