Gov. Murphy Signs Legislation Rolling Back Tax On Jersey Shore Rentals
LONG BEACH ISLAND, N.J. (CBS) -- New Jersey Gov. Phil Murphy signed legislation Friday that rolls back a tax on summer rentals that had annoyed shore property owners. It's also good news for vacationers hit by the new accommodations tax.
"It's a beautiful island with beautiful beaches, with great shops, with wonderful restaurants," LBI resident Denise Payne said.
Those are just some of the reasons Payne calls LBI home. She loves it so much that she decided to purchase a rental property a few hundred yards from the beach, and she manages it herself.
"I contract with the people directly. I know them or I meet them and find out you know how many people are coming," Payne said.
But a 2018 law changed the fees she had to charge.
"It came as a surprise to a lot of people," Payne said.
A more than 11% sales and occupancy tax, usually reserved for hotels and enacted to level the playing field with online sites like Airbnb, now imposed on anyone renting a vacation home down the shore directly from the owner.
"It could be anywhere from an additional $400 to $2,000 plus," Payne said.
And the renter was responsible for paying it.
"The vacancy rate was much higher this year on LBI and Wildwood," Payne said.
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The tax wasn't just passed along to the many vacationing down the Jersey Shore. It turns out, it also hurt the many local businesses.
"For every business saying they were having a good summer, we had two businesses saying they had a bad summer," rental owner Dwayne Watlington said.
Simply put, Watlington says visitors were spending less on food and fun since they were being charged more for their rentals.
So Watlington, Payne and others with the NJ Shore Rental Coalition petitioned state leaders. On Friday, Murphy signed new legislation reverting the 2018 law, making direct transactions between home owners and those visiting the shore now exempt from paying the tax.
"I'm feeling really relieved that this burden of this tax, which was incorrectly imposed on us last year, was corrected," Watlington said.
