
the staff of the Ridgewood blog
TRENTON, NJ — As New Jersey lawmakers finalize the $58.1 billion state budget for fiscal year 2026 — the largest in state history — one controversial item appears to be making its way into the final cut: increased sales taxes on cigarettes, vaping products, and internet gaming.
Governor Phil Murphy’s proposed budget, originally unveiled in February, called for a combination of expanded tax exemptions and targeted tax hikes, aimed at bolstering revenue while providing some financial relief to families.
🚬 What’s Included: Cigarette & Vape Tax Hikes
Among the most significant proposed tax increases are those on tobacco and vaping products:
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Cigarettes: Tax to rise from $2.70 to $3.00 per pack (20 cigarettes) starting August 1, 2025
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Liquid nicotine: Tax to increase from $0.10 to $0.30 per fluid milliliter
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E-liquid containers: Retail tax to rise from 10% to 30% of sale price
The cigarette and vaping tax increases alone are expected to generate $69 million in new revenue.
đź’» Online Gaming & Sports Betting Tax Changes
Another major revenue stream under review:
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Internet casino gaming tax: Increasing from 15% to 30%
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Internet sports wagering tax: Increasing from 13% to 30%
These changes reflect New Jersey’s ongoing effort to regulate and profit from its thriving online gambling industry.
🍼 What’s Exempt: Baby Items & Sunscreen
On the flip side, the budget includes new tax exemptions for essential household items:
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Baby products no longer subject to sales tax:
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Cribs
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Car seats
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Nursing bottles and nipples
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Baby soap, shampoo, lotion, and powder
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Strollers and child restraint systems
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Sunscreen products (FDA-regulated creams, sprays, lotions, and gels) will also be tax-exempt, provided they are specifically formulated to protect against UV radiation.
Note: Cosmetics or beauty products labeled as “sunscreen” but used primarily for appearance enhancement will not be included in the exemption.
🏛️ What’s Off the Table?
While originally floated in early budget discussions, the following items do not appear in current legislative committee bills:
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No tax hike on alcohol
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No expanded tax on recreational activities (e.g., bowling, laser tag, go-karting)
⏳ Budget Deadline Approaching
The New Jersey Legislature has until Monday, June 30 to pass the state budget and send it to Governor Murphy’s desk. To avoid a government shutdown, it must be signed into law before midnight.
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Hey Mr Beaver teeth wall street wiz… how about cutting spending
Maybe the $$ will be used wisely instead of causing bankruptcy in a few years.
Not a chance. they spend spend spend
$58.1 Billion? This state does not have a revenue problem. THAT’s a lot of revenue. We have a deep-seated spending problem that can only be addressed at the voting booth. NJ, please, wake up.
They shouldn’t make cigarettes 10 bucks a back, so that money cost towards the people that are getting sick. How about that?
It’s hard to imagine what that even means. I read it a few times, changed a few words, typos (?), and still don’t get it.
Many people enjoy a smoke while they’re drinking!