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Division of Taxation

Cosmetic Medical Procedures Gross Receipts Tax

Cosmetic Medical Procedures Gross Receipts Tax (CMPT) has been eliminated. No tax is due on procedures after July 1, 2014.

From 2004 to 2014, the State imposed a CMPT on the purchase of certain “cosmetic medical procedures,” which are medical procedures performed in order to improve the human subject’s appearance without significantly serving to prevent or treat illness or disease or to promote proper functioning of the body. Such procedures include:

  • Cosmetic surgery;
  • Hair transplants ;
  • Cosmetic injections;
  • Cosmetic soft tissue fillers;
  • Dermabrasion and chemical peels;
  • Laser hair removal;
  • Laser skin resurfacing;
  • Laser treatment of leg veins;
  • Sclerotherapy; and
  • Cosmetic dentistry.

The tax also applied to amounts charged for goods or facility occupancies, such as hospitalization or clinic stays required for or directly associated with the cosmetic medical procedure.

Reconstructive surgery or dentistry to correct or minimize abnormal structures caused by congenital defects, developmental abnormalities, trauma, infection, tumors, or disease, including procedures performed in order to improve function or give the person a more normal appearance were not considered cosmetic medical procedures for the purpose of the tax.

Charges for medical procedures, tangible personal property, or occupancies that were covered by medical insurance were presumed not primarily “cosmetic” in nature and therefore were not subject to the CMPT.

Charges for procedures, tangible personal property, and occupancies that were deductible as “medical expenses” for purposes of federal income tax were also generally exempt from the CMPT (i.e. laser vision correction, breast reconstruction). Cosmetic medical procedures that are not deemed to be deductible medical expenses for federal income tax purposes were subject to this gross receipts tax (i.e. teeth whitening).

The rate was 6% on gross receipts from cosmetic procedures and related goods and occupancies prior to the phase-out of the tax. Beginning January 17, 2012, the rate reduced to 4%, then 2% in 2013, and then eliminated entirely on taxable services performed on or after July 1, 2014.

The provider of services, goods, or occupancies required for, or directly associated with the cosmetic medical procedure would collect the tax from the person on whom the cosmetic medical procedure was performed. If more than one service provider billed for services directly related to the same cosmetic medical procedure – a surgeon and an anesthesiologist – each service provider must collect the gross receipts tax on the portion of the gross receipts billed for that provider’s own services.

A provider of goods, services, or occupancies who failed to charge, collect, and remit the tax as required was held personally liable for the tax (excluding “bad debts” within the meaning of the Internal Revenue Code). The tax did not apply to services that were only indirectly related to the cosmetic medical procedure (i.e. fees charged for evaluation and referral by a primary care physician or for consultation or treatment by a psychiatrist).

All providers of cosmetic medical procedures, tangible personal property, or occupancies that were subject to the cosmetic medical procedures gross receipts tax were required to be registered and were to report and remit the tax quarterly, following the close of the quarter when the provider received partial or full payment for the taxable cosmetic medical services rendered.

Applicable Laws and Rules

N.J.A.C. 18:24, P.L. 1992, C. 16, P.L. 2002, c. 72

Last Updated: Tuesday, 05/17/22