Amends the record-keeping requirements for liquor and wine brand owners registered with the state liquor authority or the alcohol and tobacco tax and trade bureau.
TITLE OF BILL: An act to amend the tax law, in relation to the tax imposed upon alcoholic beverages
PURPOSE OF THE BILL: To create an audit trail and inventory control process in order to significantly reduce or eliminate tax avoidance.
SUMMARY OF SPECIFIC PROVISIONS:
§ 1- Amends subdivision 16 of § 420 of the Tax Law by defining a "brand owner" as any person who is a manufacturer of any liquor or wine for which a brand or trade name label has been registered with and approved by the State Liquor Authority or by the Alcohol and Tobacco Tax Trade Bureau.
§ 2- Amends § 426 of the Tax Law by creating a "primary source" law.
§ 3- Effective date.
JUSTIFICATION: Currently, New York State does not have a stand-alone primary source law. Instead, New York achieves some degree of the benefits of a primary source law through its brand label registration and price posting systems. The recently released final report from the New York State Law Revision Commission, which was charged with the job of reviewing the Alcoholic Beverage Control Law and its administration by the State Liquor Authority, recommended that the ABC Law be amended to include a freestanding primary source law.
An economic analysis of a primary source law estimates the state could gain up to $39 million annually in state sales and excise taxes. Additionally, a primary source law would give the state the ability to completely audit the wine and liquor sales chain to accurately track any unpaid taxes.
PRIOR LEGISLATIVE HISTORY: New bill.
FISCAL IMPLICATIONS: To be determined.
EFFECTIVE DATE: This act shall take effect on the ninetieth day after it shall have become law.
STATE OF NEW YORK ________________________________________________________________________ 9815 IN ASSEMBLY January 29, 2010 ___________Introduced by M. of A. SCHIMMINGER -- read once and referred to the Committee on Ways and Means AN ACT to amend the tax law, in relation to the tax imposed upon alco- holic beverages THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 16 of section 420 of the tax law, as added by chapter 891 of the laws of 1986, is amended to read as follows: 16. "Brand owner" means any person who is a manufacturer of any liquor or wine for which a brand or trade name label has been registered with and approved by the state liquor authority pursuant to section one hundred seven-a of the alcoholic beverage control law OR BY THE ALCOHOL AND TOBACCO TAX AND TRADE BUREAU. For purposes of this subdivision the term manufacturer includes a distiller,
[importer,]vintner or rectifi- er. S 2. Section 426 of the tax law, as amended by chapter 891 of the laws of 1986, is amended to read as follows: S 426. Records to be kept by brand owners, distributors, owners and others. 1. THE BRAND OWNER, OR, WHERE THE BRAND OWNER HAS DESIGNATED ANOTHER PERSON TO ACT AS THE EXCLUSIVE AGENT OF THE BRAND OWNER, SUCH EXCLUSIVE AGENT OF THE BRAND OWNER, SHALL MAINTAIN A COMPLETE AND ACCURATE RECORD OF ALL THE DISTRIBUTORS OR HOLDERS OF A WHOLESALER'S LICENSE TO WHOM IT HAS SOLD LIQUOR OR WINE WHICH IS MANUFACTURED BY THE BRAND OWNER, TOGETHER WITH A RECORD OF THE NUMBER OF BOTTLES SOLD TO SUCH DISTRIBUTOR OR HOLDER OF A WHOLESALER'S LICENSE, THE SIZE OF THE BOTTLES AND ITS DESCRIPTION BY BRAND NAME. SUCH RECORD SHALL BE IN A FORM PRESCRIBED BY THE TAX COMMISSION, SHALL BE PRESERVED FOR THREE YEARS, AND SHALL BE OFFERED FOR INSPECTION AT ANY TIME UPON THE ORAL OR WRITTEN DEMAND OF THE COMMISSIONER OR HIS DULY AUTHORIZED AGENTS. 2. NO DISTRIBUTOR OR HOLDER OF A WHOLESALER'S LICENSE SHALL ORDER, PURCHASE OR RECEIVE ANY LIQUOR OR WINE FROM A SOURCE OTHER THAN A BRAND OWNER, OR WHERE THE BRAND OWNER HAS DESIGNATED ANOTHER PERSON TO ACT AS THE EXCLUSIVE AGENT OF THE BRAND OWNER, SUCH EXCLUSIVE AGENT OF THEEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD15487-01-0 A. 9815 2
BRAND OWNER. NO OWNER SHALL ORDER, PURCHASE OR RECEIVE LIQUOR OR WINE OTHER THAN FROM A DISTRIBUTOR OR HOLDER OF A WHOLESALER'S LICENSE WHO PURCHASED SUCH LIQUOR OR WINE FROM A BRAND OWNER, OR WHERE THE BRAND OWNER HAS DESIGNATED ANOTHER PERSON TO ACT AS THE EXCLUSIVE AGENT OF THE BRAND OWNER, SUCH EXCLUSIVE AGENT OF THE BRAND OWNER. 3. Every brand owner, distributor, HOLDER OF A WHOLESALER'S LICENSE, owner or other person shall keep a complete and accurate record of all purchases and sales or other dispositions of alcoholic beverages, and a complete and accurate record of the number of gallons of beers produced, manufactured, brewed or fermented and liters of all other alcoholic beverages produced, distilled, manufactured, brewed, compounded, mixed or fermented. Such records shall be in such form and contain such other information as the tax commission shall prescribe. Said commission, by rule or regulation, also may require the delivery of statements to purchasers of alcoholic beverages, and prescribe the matters to be contained therein. Such records and statements, unless required by the tax commission to be preserved for a longer period, shall be preserved for a period of one year and shall be offered for inspection at any time upon oral or written demand by the commissioner
[of taxation and finance]or his duly authorized agents, and every such distributor, brand owner, owner or other person shall make such reports to the department [of taxation and finance]as may be required by the tax commission. Nothing in this section contained shall be construed to require the keeping of a record of the purchase or disposition of alco- holic beverages by a consumer thereof, except by a person who uses the same for commercial purposes, or of the sale of alcoholic beverages at retail. S 3. This act shall take effect on the ninetieth day after it shall have become a law.