NJ reclaims $40M in sales tax mistake

May 14, 2009 5:58:50 AM PDT
New Jersey has reclaimed $40 million that was mistakenly sent to 37 towns that have urban enterprise zones. The zones allow businesses to charge half the normal sales tax and the revenue generated helps fund development within the zones.

The mistake dates back to 2006 when the state sales tax increased from 6 to 7 percent.

The Treasury Department says half of the increase was supposed to go property tax relief. But the state wrongly directed half to tax relief and half to the enterprise zones.

Municipal officials are angry that the state reclaimed the money in a lump sum because redevelopment projects were in the works.

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Information from: The Press of Atlantic City, http://www.pressofatlanticcity.com

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