New Jersey Assembly Bill A4698

New Jersey 2026-2027 Regular Session

• Introduced: 3/16/26
• Refer: 3/16/26

Caption

Imposes 10 percent electric public utility windfall surtax on taxpayers with allocated taxable net income in excess of $10 million under CBT.

Summary

This bill creates an electric public utility windfall surtax under the New Jersey Corporation Business Tax Act. It applies to electric public utilities that have more than $10 million in allocated taxable net income for privilege periods beginning on or after January 1 of the year after enactment. Those taxpayers would owe an additional 10 percent surtax on that income, on top of their regular corporation business tax liability, with only limited credits allowed for estimated payments, extension payments, and prior overpayments. The bill directs the revenue from the surtax, except for any constitutionally dedicated amounts, to be annually appropriated to the Board of Public Utilities for utility assistance programs. The bill also bars the Board from approving any rate increase or charge to ratepayers that includes the cost of complying with the surtax. The stated purpose is to capture what the sponsor describes as excessive utility profits and use the proceeds to support programs that help residential customers pay for electricity, gas, water, and related utility costs.

Impact

The bill would amend the Corporation Business Tax framework by adding a new surtax specifically targeting electric public utilities with high taxable net income. It would affect utility companies subject to CBT, the Board of Public Utilities, and the State’s utility assistance programs by creating a dedicated revenue stream for those programs. It also would constrain utility rate-setting by prohibiting the pass-through of surtax compliance costs to ratepayers, potentially affecting how utilities seek rate adjustments and how the BPU evaluates them.

Sentiment

The bill is presented in strongly supportive terms, with the sponsor framing it as a consumer-protection and affordability measure in response to rising electricity rates and broader cost-of-living pressures. The statement emphasizes that electricity and gas are essential services and argues that utility profits should help fund assistance for struggling households rather than be borne by ratepayers. No committee votes or hearing transcripts were provided, so there is no recorded opposition or amendment debate in the supplied materials.

Contention

The main point of contention is likely to be whether a 10 percent surtax on electric utilities is an appropriate way to fund assistance programs and whether it could affect utility finances, investment, or future rate-setting. Another likely dispute is the bill’s prohibition on passing compliance costs through to customers, which utilities may view as limiting their ability to recover expenses. Supporters, by contrast, are likely to argue that the measure protects consumers from rate increases and ensures that utility windfalls are redirected to low-income and other assistance programs.