Allows CBT and gross income tax deductions for certain charitable contributions of food made from business inventory.
Impact
If enacted, A5598 will amend existing New Jersey tax laws to include provisions for these charitable contributions, thereby incentivizing businesses to donate surplus food rather than discarding it. This is particularly relevant in the context of addressing food insecurity and supporting local food banks. The bill outlines specific definitions of 'apparently wholesome food,' ensuring standards are met for such contributions, and clarifies how deductions would apply to different types of business entities, such as partnerships and S corporations.
Summary
A5598, introduced in the New Jersey Legislature on June 8, 2023, aims to encourage charitable contributions of food by allowing businesses to claim deductions under the Corporation Business Tax (CBT) and gross income tax for donations of apparently wholesome food made from their inventory. The bill mirrors provisions in the federal Internal Revenue Code that allow similar deductions for federal tax purposes, seeking to promote food donation and reduce food waste in the state.
Contention
Notable points of contention may arise around the bill's definitions and the potential for misuse of the deductions. While proponents argue that it will provide significant benefits to local organizations and address food waste, critics may worry about the possibility of incentivizing businesses to donate lower-quality food under the guise of charitable contributions. Ensuring that the food meets health and safety standards, as described in the bill, may also help mitigate these concerns.
Provides corporation business tax credits and gross income tax credits to small business employers and farm employers for increases in certain mandatory employer contributions.
Provides corporation business tax credits and gross income tax credits to small business employers and farm employers for increases in certain mandatory employer contributions.