If you board your horse or own a horse boarding business in New Jersey, chances are you’re aware of the extra 7% charge that must go onto boarding fees every month. (If you own a boarding business and aren’t aware of this, go here for an idea of what you should have been doing since 2006 or you might have the New Jersey tax officials after you!)
Fees for boarding horses are taxable unless a certain exemption applies such as boarding horses for a horse dealer or boarding horses for a horse breeder. However, most of us just own our horse for the pleasure of riding and/or competing, so we have to pay that extra 7% each month.
There is some good news though. Assemblyman Ron Dancer has proposed legislation that would remove the sales tax on horse boarding. According to a press release, Dancer stated that there is a lot of confusion regarding the taxability of horse boarding. This confusion, he stated, “has placed New Jersey horse boarding businesses at a competitive disadvantage.” Since New York, Pennsylvania, and Delaware do not have a boarding sales tax, Assemblyman Dancer feels that New Jerseyans are on an uneven playing field with surrounding competitors.
I have some reservations about Assemblyman Dancer’s comments. I personally don’t know of anyone who would board his or her horse in one of the surrounding states to save money on the sales tax, unless of course, that person happened to live relatively close to the border. But for someone like me, who lives in northern New Jersey and is approximately an hour and a half outside of Pennsylvania, rural New York, and quite a ways from Delaware, I don’t think I would be willing to expend more driving time just to save myself from paying sales tax. I’d end up spending what I would’ve saved on gas!
Regardless, this is a good idea, and one I hope makes some movement next year in the NJ legislature. It will certainly reduce the burden on businesses who are tasked with figuring out whether they fall under the sales tax rule and who have to file quarterly sales tax reports with the state.
And what boarder is going to say no to saving some money every month? I’d like an extra $42 to put towards something else. Perhaps something from SmartPak?