Bill S1766A-2013

Provides motor fuel tax exemption for sales of diesel motor fuel used in vessels used directly in a business providing sport fishing opportunities

Provides motor fuel tax exemption for sales of diesel motor fuel used in vessels used directly in a business providing sport fishing opportunities for hire to the general public from the tax on petroleum businesses and from sales and compensating use taxes.

Details

Actions

  • Apr 29, 2014: REPORTED AND COMMITTED TO FINANCE
  • Jan 8, 2014: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • May 3, 2013: PRINT NUMBER 1766A
  • May 3, 2013: AMEND AND RECOMMIT TO FINANCE
  • Apr 30, 2013: REPORTED AND COMMITTED TO FINANCE
  • Jan 9, 2013: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Meetings

Votes

VOTE: COMMITTEE VOTE: - Investigations and Government Operations - Apr 29, 2014
Ayes (7): Marcellino, Carlucci, Golden, Nozzolio, O'Mara, Zeldin, Diaz
Ayes W/R (2): Hoylman, Squadron

Memo

BILL NUMBER:S1766A

TITLE OF BILL: An act to amend the tax law, in relation to exempting fuel used in vessels used directly and predominantly in a business providing sport fishing opportunities for hire to the general public from the tax on petroleum businesses and from sales and compensating use taxes

PURPOSE:

Provides motor fuel tax exemption for sales of diesel motor fuel used in vessels used directly in a business providing sport fishing opportunities.

SUMMARY OF PROVISIONS:

Amends the tax law to provide a full exemption from both the petroleum business tax and sales and compensating use tax for charter boats used directly and predominantly in a business providing sport fishing opportunities for hire to the general public.

JUSTIFICATION:

The original intent of this policy, as it relates to charter boats and commercial fishing vessels, was to prevent tax evasion in the diesel fuel industry. However, it was not intended to be burdensome to many of the state's industries such charter boats and their fuel distributors.

The implementation of this law has caused a great deal of hardship for the marine and party charter boat industry. The negative financial consequences of this cash flow are a large burden for the charter boat captains of this state.

The negative impacts of this law have also been carried over to the fuel distributors of charter boats. Because of the payment requirement, many captains are now purchasing their fuel at ports outside of New York. This will result in the loss of thousands of dollars in revenue for the state's fuel distributors. This legislation would no longer require charter boats to pay any excise or state sales taxes for the purchase of diesel motor fuel.

This legislation would provide a full exemption from both the petroleum business tax and sales and compensating use tax for charter boats used directly and predominantly in a business providing sport fishing opportunities for hire to the general public.

LEGISLATIVE HISTORY:

2012: A.9999/S.7145

FISCAL IMPLICATIONS:

To be determined.

EFFECTIVE DATE:

This act shall take effect immediately and shall be deemed to have been in full force and effect on and after January 1, 2012; provided, further, that the amendments to the opening paragraph of Section 301-c of the tax law, made by section four of this act shall not affect the expiration and repeal of such paragraph pursuant to Section 19 of part W-1 of Chapter 109 of the Laws of 2006, as amended, and shall expire and be deemed repealed therewith, when upon such date the provisions of section five of this act shall take effect.


Text

STATE OF NEW YORK ________________________________________________________________________ S. 1766--A A. 1218--A 2013-2014 Regular Sessions S E N A T E - A S S E M B L Y (PREFILED) January 9, 2013 ___________
IN SENATE -- Introduced by Sen. LAVALLE -- read twice and ordered print- ed, and when printed to be committed to the Committee on Investi- gations and Government Operations -- reported favorably from said committee and committed to the Committee on Finance -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee IN ASSEMBLY -- Introduced by M. of A. THIELE, GRAF -- read once and referred to the Committee on Ways and Means -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the tax law, in relation to exempting fuel used in vessels used directly and predominantly in a business providing sport fishing opportunities for hire to the general public from the tax on petroleum businesses and from sales and compensating use taxes THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 300 of the tax law is amended by adding a new subdivision (j-1) to read as follows: (J-1) "COMMERCIAL SPORT FISHING VESSEL" MEANS A VESSEL OWNED BY A PERSON, WHO HAS BEEN ISSUED AND HOLDS A MARINE AND COASTAL DISTRICT PARTY AND CHARTER BOAT LICENSE PURSUANT TO SECTION 13-0336 OF THE ENVI- RONMENTAL CONSERVATION LAW. S 2. Paragraph 2 of subdivision (b) of section 301-a of the tax law, as added by section 154 of part A of chapter 389 of the laws of 1997, is amended to read as follows: (2) Motor fuel brought into this state in the fuel tank connecting with the engine of a vessel propelled by the use of such motor fuel shall be deemed to constitute a taxable use of motor fuel for the purposes of this subdivision to the extent that the fuel is consumed in
the operation of the vessel in this state. Provided, however, that this paragraph shall not apply to (i) a recreational motor boat or (ii) subsequent to August thirty-first, nineteen hundred ninety-four, a commercial fishing vessel (as defined in subdivision (j) of section three hundred of this article) if the motor fuel imported and consumed in this state is used to operate such vessel while it is engaged in the harvesting of fish for sale OR (III) A COMMERCIAL SPORT FISHING VESSEL, IF SUCH VESSEL PROVIDES ITS OWNER WITH AT LEAST FIFTY PERCENT OF HIS OR HER TOTAL ANNUAL INCOME. Provided, further, that tax liability for gallonage that a vessel consumes shall be the tax liability with respect to the positive difference between the gallonage consumed in this state during the reporting period and the gallonage purchased in this state (upon which the tax imposed by this section has been paid) during such period. A credit or refund shall be available for any excess of tax liability for gallonage purchased in this state during the period over tax liability on gallonage so consumed in this state during such period, which excess shall be presumed to have been used outside this state. S 3. Subparagraph (B) of paragraph 1 of subdivision (c) of section 301-a of the tax law, as amended by section 19 of part K of chapter 61 of the laws of 2011, is amended to read as follows: (B) Highway diesel motor fuel brought into this state in the fuel tank connecting with the engine of a vessel propelled by the use of such diesel motor fuel shall be deemed to constitute a taxable use of diesel motor fuel for the purpose of this paragraph to the extent of the fuel that is consumed in the operation of the vessel in this state. Provided, however, this paragraph shall not apply to (i) a recreational motor boat or (ii) a commercial fishing vessel (as defined in subdivision (j) of section three hundred of this article) if the highway diesel motor fuel imported into and consumed in this state is used to operate such commer- cial fishing vessel while it is engaged in the harvesting of fish for sale OR (III) A COMMERCIAL SPORT FISHING VESSEL, IF SUCH VESSEL PROVIDES ITS OWNER WITH AT LEAST FIFTY PERCENT OF HIS OR HER TOTAL ANNUAL INCOME. Provided, further, that tax liability for gallonage that a vessel consumes in this state shall be the tax liability with respect to the positive difference between the gallonage consumed in this state during the reporting period and the gallonage purchased in this state (upon which the tax imposed by this section has been paid) during such period. A credit or refund shall be available for any excess of tax liability for gallonage purchased in this state during the period over tax liabil- ity on gallonage so consumed in this state during such period, which excess shall be presumed to have been used outside this state. S 4. The opening paragraph of section 301-c of the tax law, as amended by section 5 of part W-1 of chapter 109 of the laws of 2006, is amended to read as follows: A subsequent purchaser shall be eligible for reimbursement of tax with respect to the following gallonage, subsequently sold by such purchaser in accordance with subdivision (a), (b), (e), (h), (j), (k), (n) or (o) of this section or used by such purchaser in accordance with subdivision (c), (d), (f), (g), (G-1), (i), (l) or (m) of this section, which gallo- nage has been included in the measure of the tax imposed by this article on a petroleum business: S 5. The opening paragraph of section 301-c of the tax law, as amended by chapter 468 of the laws of 2000, is amended to read as follows: A subsequent purchaser shall be eligible for reimbursement of tax with respect to the following gallonage, subsequently sold by such purchaser in accordance with subdivision (a), (b), (e), (h), (j) or (k) of this
section or used by such purchaser in accordance with subdivision (c), (d), (f), (g), (G-1), (i), (l) or (m) of this section, which gallonage has been included in the measure of the tax imposed by this article on a petroleum business: S 6. Section 301-c of the tax law is amended by adding a new subdivi- sion (g-1) to read as follows: (G-1) DIESEL MOTOR FUEL AND MOTOR FUEL USED IN THE OPERATION OF COMMERCIAL SPORT FISHING VESSELS. DIESEL MOTOR FUEL OR MOTOR FUEL PURCHASED IN THIS STATE BY THE OPERATOR OF A COMMERCIAL SPORT FISHING VESSEL AT RETAIL WHEREIN SUCH DIESEL MOTOR FUEL OR SUCH MOTOR FUEL IS DELIVERED BY A PUMP EQUIPPED WITH A HOSE DIRECTLY INTO THE FUEL TANK OF A COMMERCIAL SPORT FISHING VESSEL TO BE USED AS FUEL IN THE OPERATION OF SUCH VESSEL FOR THE PURPOSE OF PROVIDING SPORT FISHING OPPORTUNITIES FOR HIRE TO THE GENERAL PUBLIC; BUT ONLY WHERE (1) THE TAX IMPOSED PURSUANT TO THIS ARTICLE HAS BEEN PAID WITH RESPECT TO SUCH DIESEL MOTOR FUEL OR SUCH MOTOR FUEL AND THE ENTIRE AMOUNT OF SUCH TAX HAS BEEN ABSORBED BY SUCH PURCHASER, (2) SUCH PURCHASER POSSESSES DOCUMENTARY PROOF SATISFAC- TORY TO THE COMMISSIONER EVIDENCING THE ABSORPTION BY IT OF THE ENTIRE AMOUNT OF THE TAX IMPOSED PURSUANT TO THIS ARTICLE, AND (3) THE VESSEL PROVIDES ITS OWNER WITH AT LEAST FIFTY PERCENT OF HIS OR HER TOTAL ANNU- AL INCOME. PROVIDED, HOWEVER, THAT THE COMMISSIONER SHALL REQUIRE SUCH DOCUMENTARY PROOF TO QUALIFY FOR ANY REIMBURSEMENT OF TAX PROVIDED BY THIS SECTION AS THE COMMISSIONER DEEMS APPROPRIATE. S 7. Subdivision (a) of section 1115 of the tax law is amended by adding a new paragraph 24-a to read as follows: (24-A) FUEL USED IN VESSELS USED DIRECTLY AND PREDOMINANTLY IN A BUSI- NESS PROVIDING SPORT FISHING OPPORTUNITIES FOR HIRE TO THE GENERAL PUBLIC; PROVIDED THAT SUCH VESSEL PROVIDES ITS OWNER WITH AT LEAST FIFTY PERCENT OF HIS OR HER TOTAL ANNUAL INCOME. S 8. Subparagraph (i) of paragraph 1 of subdivision (a) of section 1210 of the tax law, as amended by chapter 13 of the laws of 2013, is amended to read as follows: (i) Any local law, ordinance or resolution enacted by any city of less than one million or by any county or school district, imposing the taxes authorized by this subdivision, shall, notwithstanding any provision of law to the contrary, exclude from the operation of such local taxes all sales of tangible personal property for use or consumption directly and predominantly in the production of tangible personal property, gas, electricity, refrigeration or steam, for sale, by manufacturing, proc- essing, generating, assembly, refining, mining or extracting; and all sales of tangible personal property for use or consumption predominantly either in the production of tangible personal property, for sale, by farming or in a commercial horse boarding operation, or in both; and, unless such city, county or school district elects otherwise, shall omit THE FUEL USED IN COMMERCIAL SPORT FISHING VESSELS EXEMPTION PROVIDED FOR IN PARAGRAPH TWENTY-FOUR-A OF SUBDIVISION (A) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS CHAPTER, the provision for credit or refund contained in clause six of subdivision (a) or subdivision (d) of section eleven hundred nineteen of this chapter. S 9. Section 1210 of the tax law is amended by adding a new subdivi- sion (q) to read as follows: (Q) NOTWITHSTANDING ANY OTHER PROVISION OF STATE OR LOCAL LAW, ORDI- NANCE OR RESOLUTION TO THE CONTRARY: (1) ANY CITY HAVING A POPULATION OF ONE MILLION OR MORE IN WHICH THE TAXES IMPOSED BY SECTION ELEVEN HUNDRED SEVEN OF THIS CHAPTER ARE IN EFFECT, ACTING THROUGH ITS LOCAL LEGISLATIVE BODY, IS HEREBY AUTHORIZED
AND EMPOWERED TO ELECT TO PROVIDE THE SAME EXEMPTIONS FROM SUCH TAXES AS THE FUEL USED IN COMMERCIAL SPORT FISHING VESSELS EXEMPTION FROM STATE SALES AND COMPENSATING USE TAXES DESCRIBED IN PARAGRAPH TWENTY-FOUR-A OF SUBDIVISION (A) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS CHAPTER BY ENACTING A RESOLUTION IN THE FORM SET FORTH IN PARAGRAPH TWO OF THIS SUBDIVISION; WHEREUPON, UPON COMPLIANCE WITH THE PROVISIONS OF SUBDIVI- SIONS (D) AND (E) OF THIS SECTION, SUCH ENACTMENT OF SUCH RESOLUTION SHALL BE DEEMED TO BE AN AMENDMENT TO SUCH SECTION ELEVEN HUNDRED SEVEN AND SUCH SECTION ELEVEN HUNDRED SEVEN SHALL BE DEEMED TO INCORPORATE SUCH EXEMPTIONS AS IF THEY HAD BEEN DULY ENACTED BY THE STATE LEGISLA- TURE AND APPROVED BY THE GOVERNOR. (2) FORM OF RESOLUTION: BE IT ENACTED BY THE (INSERT PROPER TITLE OF LOCAL LEGISLATIVE BODY) AS FOLLOWS: SECTION ONE. RECEIPTS FROM SALES OF AND CONSIDERATION GIVEN OR CONTRACTED TO BE GIVEN FOR, OR FOR THE USE OF, PROPERTY AND SERVICES EXEMPT FROM STATE SALES AND COMPENSATING USE TAXES PURSUANT TO PARAGRAPH TWENTY-FOUR-A OF SUBDIVISION (A) OF SECTION 1115 OF THE TAX LAW SHALL ALSO BE EXEMPT FROM SALES AND COMPENSATING USE TAXES IMPOSED IN THIS JURISDICTION. SECTION TWO. THIS RESOLUTION SHALL TAKE EFFECT JUNE 1, (INSERT THE YEAR, BUT NOT EARLIER THAN THE YEAR 2010) AND SHALL APPLY TO SALES MADE, SERVICES RENDERED AND USES OCCURRING ON AND AFTER THAT DATE IN ACCORD- ANCE WITH THE APPLICABLE TRANSITIONAL PROVISIONS IN SECTIONS 1106, 1216 AND 1217 OF THE NEW YORK TAX LAW. S 10. This act shall take effect immediately and shall be deemed to have been in full force and effect on and after January 1, 2012; provided, further, that the amendments to the opening paragraph of section 301-c of the tax law, made by section four of this act shall not affect the expiration and repeal of such paragraph pursuant to section 19 of part W-1 of chapter 109 of the laws of 2006, as amended, and shall expire and be deemed repealed therewith, when upon such date the provisions of section five of this act shall take effect.

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