Allows residents of certain Highlands municipalities to designate on gross income tax returns that a portion of gross income tax paid be returned to municipality of residence.

This bill establishes the "NJ Highlands Tax Fairness Fund" to allow residents of eight specific municipalities (Bloomsbury Borough, Byram Township, Califon Borough, Glen Gardner Borough, Kinnelon Borough, Lebanon Township, Ringwood Borough, and West Milford Township) to direct 10% of their state income tax (after credits for taxes paid to other jurisdictions) back to their local government. Designated funds are distributed annually to these municipalities in proportion to the amount designated by their residents, and must be used exclusively to reduce property tax levies for residents. The fund is separate from other state aid and cannot offset existing aid programs. This applies only to municipalities where 95% or more of the land area is within the Highlands preservation zone under New Jersey law.