Murphy Signs Law Exempting Combat Pay From New Jersey Income Tax

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TRENTON, N.J. (CBS/AP) - New Jersey Democratic Gov. Phil Murphy on Monday signed bipartisan legislation exempting combat pay earned by members of the military from the state income tax. Federal law already exempts combat pay from income tax, but the New Jersey law means pay that residents earn while in combat zones won't be subject to the state's income tax as well.

"Members of the military put everything on the line for our state and our country," Murphy said. "I am happy and proud that, even in the midst of our state's most serious fiscal crisis, we were able to find a way to make life easier for our troops and provide some long-overdue relief to the bravest among us."

Murphy signed the bill Monday during a Facebook Live session with Republican Sen. Michael Testa and Democratic Assemblywoman Annette Quijano. Both lawmakers sponsored the legislation, which passed unanimously in both chambers earlier this month.

"Previous versions of this important bill have languished in the Legislature for 10 years. When I was sworn into the Senate in January, I made this one of my priorities and began advocating for its passing and enactment on behalf of American servicemen and women," Testa said. "I am proud that working with colleagues on both sides of the aisle, we are finally reversing the insensitive policy, and I thank the Governor for his support."

The measure defines a combat zone as any area the president designates as such in an executive order. Combat zone pay is an additional payment beyond a military member's regular salary.

Lawmakers say there are currently four active combat zones: the Sinai Peninsula; the Afghanistan area, which includes 10 countries; the Kosovo area, which includes parts of the Balkans; and the Arabian Peninsula area.

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