NJ SODA POP Act advances tax breaks for historic diners

The basics:

• SODA POP Act would create registry for diners operating 25+ years
• Eligible eateries could receive sales tax exemptions on food, beverages
• Businesses may qualify for up to $25,000 in ingredient tax credits
• Bill advances in Senate; fiscal impact still under review

New Jersey lawmakers are considering a measure that would give struggling family-run diners a lifeline to stay afloat.

As the Diner Capital of the World, New Jersey is home to more than 500 diners. However, many have closed in recent years due to rising inflation, supply chain issues and shifting consumer patterns. Those that remain have back from 24/7 operations, trimmed menu offerings or dropped dinner service altogether to survive.

State Sen. Paul Moriarty, D-4th District, and Assemblyman Lou Greenwald, D-6th District, introduced legislation that would provide targeted tax benefits to such qualifying eateries. The measure aims to help preserve historic diners and restaurants, as well as keep them open amid economic pressures.

Under the Saving Our Diners and Preserving Our Past (SODA POP) Act, diners and restaurants operating continuously for at least 25 years — not counting pandemic-related shutdowns — could apply for inclusion on an annual registry of historic eateries.

SODA POP would entitle any business on that list would to certain tax benefits, including:

• A sales and use tax exemption for the sales of prepared foods and beverages for on-premises consumption
• A corporation business tax or gross income tax credit for up to $25,000 of the costs incurred for the purchase of eligible ingredients

To qualify for the registry, an establishment must operate in a fixed location, be solely owned and operated by family members and count as a small business under federal law. According to the proposal, diners and restaurants can renew their exemption from charging sales tax on food and beverages by reapplying annually.

Moriarty described the legislation as a “game-changing tax benefits program.” He said it would “work to support our historic diners and give them a helping hand as they face increasing financial pressure.”

“It’s been a difficult time for diners and their customers. It has been heartbreaking to see so many of these well-known establishments close or dramatically cut their hours, leaving huge voids in the communities they loyally served,” he said in a statement.

Following its Jan. 13 introduction, the state Senate referred the legislation to the Senate Economic Growth Committee. That group reported it out Feb. 12 in a 4-0 vote. The Senate Budget and Appropriations Committee is now reviewing the measure.

The bill was introduced into the state Assembly Jan. 13. Since, it was sent to the Assembly Commerce and Economic Development Committee.

Diner culture is Jersey culture

The bill was originally introduced in December 2025 but did not pass before the legislative session ended last month.

Moriarty said, “When you go to New Jersey, you should always be able to stop at a diner and have fantastic food. Diners, and specifically historic diners, are a cornerstone of our great state, having served residents and visitors for many decades. They are part of our culture and our history, and we have a duty to help them thrive.”

Diners, and specifically historic diners, are a cornerstone of our great state, having served residents and visitors for many decades.
– State Sen. Paul Moriarty, D-4th District

New Jersey Monitor noted that it’s unclear how much the exemption and tax credit will cost the state in foregone revenue because the nonpartisan Office of Legislative Services has not yet completed a fiscal note to estimate impacts. However, Greenwald told the outlet he doesn’t think the tax breaks will strain state coffers.

Moriarty said he anticipates hundreds of eateries to qualify on the spot for the program, though it’s not known how many of them would qualify for the full value of the tax credits by spending at least $250,000 on ingredients, New Jersey Monitor reported.