Bill S2553-2013

Exempts energy star products from sales and use taxes

Exempts energy star products from sales and use taxes; grants credit for taxes paid on energy star products.

Details

Actions

  • Jan 8, 2014: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • May 7, 2013: REPORTED AND COMMITTED TO FINANCE
  • Jan 22, 2013: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Votes

VOTE: COMMITTEE VOTE: - Investigations and Government Operations - May 7, 2013
Ayes (6): Marcellino, Carlucci, Golden, Nozzolio, O'Mara, Diaz
Ayes W/R (3): Zeldin, Hoylman, Squadron

Memo

BILL NUMBER:S2553

TITLE OF BILL: An act to amend the tax law, in relation to exempting energy star products from sales and compensating use taxes; and granting credit or refund for taxes paid; and providing for reimbursement of such taxes

PURPOSE: To provide a statewide State and local sales tax exemption for one year for all energy star rated products to aid in structure rebuilding and refurbishing, and to promote the State economy during a period of storm related adverse economic impacts.

SUMMARY OF PROVISIONS:

Section 1 of the bill would provide a business franchise tax credit for sales taxes paid on energy star rated products purchased or installations and servicing related to the purchase of energy star related products between October 31, 2012 and October 31, 2013.

Sections 2 and 3 of the bill create a corresponding credit for taxpayers filing under the State's Personal Income Tax.

Sections 4, 5 and 6 of the bill create a one year exemption from sales tax for the purchase of energy star rated products and related installation services.

Section 7 of the bill provides a similar credit for New York City imposed sales taxes.

Section 8 of the bill provides that the State of New York will reimburse local governments for foregone sales tax revenues that otherwise would have been collected on energy star rated products and related services.

Section 9 provides for an immediate effective date.

EXISTING LAW: No similar credits or exemption exist in statute at the present time.

JUSTIFICATION: Super-storm Sandy has become the largest natural disaster in New York State history. Current estimates are that at least $30 billion in damages have been inflicted upon the State. All of New York is facing an arduous road to recovery. In the immediate term, the State is facing at least a two economic quarter weather impact recession.

Best available estimates place the number of Sandy related residential structures that have encountered substantial to total flood or other storm related damage at at least 170,000. These homes will need new heating and electrical systems, appliances, insulation, lights, etc.

Meanwhile, recovery efforts are still underway for those New Yorkers that were heavily impacted by last year's storms of Irene and Lee.

Full rebuilding efforts in those communities are just now getting seriously underway.

New York State can provide a small leg up for these impacted citizens, and promote an advanced State energy policy by exempting energy star rated products from sales tax during an anticipated one year rebuilding and refurbishing period. Most New Yorkers will be able to save at least 8 percent during the year recovery period for replacing or upgrading furnaces, air conditioners, hot water heaters, washers, dryers, dishwashers, computers, televisions and lighting systems and conservation materials with energy efficient products designed to save both the purchaser money and save the State energy.

This bill would provide for this exemption, or a refundable credit for purchases made during the exemption period but before the enactment date, and also would have the State reimburse localities, who face an incredibly difficult fiscal period recovering from the storm's direct and longer range effects, for the forbearance of otherwise anticipated sales tax revenues.

However, over and above the incentive provided for those directly impacted and recovering from the storms, the bill would help provide a consumer driven impetus to the regional economies in the rest of the State. As the recovery from Katrina demonstrated, all the proximate shore areas suffered the most immediate and severe impacts, yet these areas also recovered more quickly because of the rapid influx of federal and insurance funds that lead to an eventual boom in construction and tangible good purchases. The more Upstate communities in these Gulf states in general have been much slower to recover.

Making the proposed sales tax exemption statewide will provide a much needed jolt to the rest of the State, and will hopefully, bring our neighbors into the State to make their energy star rated purchases.

LEGISLATIVE HISTORY: New Bill

FISCAL IMPLICATIONS: Total of between 5125 and $150 million in reduced currently required State and local Sales Tax collections spread among State Fiscal Years 2012-13 and 2013-14 (Senate Finance estimate).

LOCAL FISCAL IMPLICATIONS: Slight delay in receipt of anticipated sales tax revenues from energy star rated product purchases counterbalanced by greater regional economic activity.

EFFECTIVE DATE: Immediately


Text

STATE OF NEW YORK ________________________________________________________________________ 2553 2013-2014 Regular Sessions IN SENATE January 22, 2013 ___________
Introduced by Sens. MARCELLINO, MAZIARZ -- read twice and ordered print- ed, and when printed to be committed to the Committee on Investi- gations and Government Operations AN ACT to amend the tax law, in relation to exempting energy star products from sales and compensating use taxes; and granting credit or refund for taxes paid; and providing for reimbursement of such taxes THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 210 of the tax law is amended by adding a new subdivision 46 to read as follows: 46. CREDIT FOR THE PURCHASE OR REPAIR OF ENERGY STAR PRODUCTS. (A) ALLOWANCE OF CREDIT. A TAXPAYER WHO, ON OR AFTER OCTOBER THIRTY-FIRST, TWO THOUSAND TWELVE AND BEFORE OCTOBER THIRTY-FIRST, TWO THOUSAND THIR- TEEN, EITHER (I) PURCHASES ENERGY STAR PRODUCTS, OR (II) PAYS FOR REPAIRS TO ENERGY STAR PRODUCTS OWNED BY THE TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN PARAGRAPH (B) OF THIS SUBDIVISION, AGAINST THE TAXES IMPOSED BY THIS ARTICLE, PROVIDED THAT SUCH TAXPAYER HAS NOT APPLIED FOR OR RECEIVED A REFUND OF SUCH TAXES PURSUANT TO SECTION ELEVEN HUNDRED THIRTY-NINE OF THIS CHAPTER. FOR PURPOSES OF THIS SUBDIVISION, THE TERM "ENERGY STAR PRODUCTS" SHALL HAVE THE SAME MEANING AS IN PARAGRAPH THIRTY-NINE OF SUBDIVISION (B) OF SECTION ELEVEN HUNDRED ONE OF THIS CHAPTER. (B) AMOUNT OF CREDIT. THE AMOUNT OF CREDIT SHALL EQUAL THE AMOUNT OF TAXES PAID BY THE TAXPAYER PURSUANT TO ARTICLES TWENTY-EIGHT AND TWEN- TY-NINE OF THIS CHAPTER FOR THE PURCHASE OR REPAIR OF ENERGY STAR PRODUCTS, AS EVIDENCED BY DATED RECEIPTS LISTING THE VENDOR'S NAME, VENDOR'S ADDRESS, AND THE AMOUNT OF SUCH TAX PAID, LESS ANY AMOUNT OF SUCH TAXES THAT THE TAXPAYER DEDUCTED FOR FEDERAL INCOME TAX PURPOSES. (C) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE HIGHER OF THE AMOUNTS PRESCRIBED IN PARAGRAPHS (C) AND (D) OF
SUBDIVISION ONE OF THIS SECTION. HOWEVER, IF THE AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED IN ACCORDANCE WITH THE PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON. (D) ANY AMOUNT OF CREDIT ALLOWED PURSUANT TO THIS SUBDIVISION FOR WHICH THE TAXPAYER SUBSEQUENTLY RECEIVES A REFUND PURSUANT TO SECTION ELEVEN HUNDRED THIRTY-NINE OF THIS CHAPTER SHALL BE RECAPTURED AND ADDED BACK IN THE TAXABLE YEAR THAT SUCH REFUND WAS RECEIVED. S 2. Subparagraph (B) of paragraph 1 of subsection (i) of section 606 of the tax law is amended by adding a new clause (xxxv) to read as follows: (XXXV) ENERGY STAR TAX CREDIT AMOUNT OF CREDIT UNDER UNDER SUBSECTION (VV) SUBDIVISION FORTY-SIX OF SECTION TWO HUNDRED TEN S 3. Section 606 of the tax law is amended by adding a new subsection (vv) to read as follows: (VV) CREDIT FOR THE PURCHASE OF ENERGY STAR PRODUCTS. (1) ALLOWANCE OF CREDIT. A TAXPAYER WHO, ON OR AFTER THE THIRTY-FIRST DAY OF OCTOBER, TWO THOUSAND TWELVE AND BEFORE OCTOBER THIRTY-FIRST, TWO THOUSAND THIRTEEN, EITHER (A) PURCHASES ENERGY STAR PRODUCTS, OR (B) PAYS FOR REPAIRS TO ENERGY STAR PRODUCTS SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN PARAGRAPH TWO OF THIS SUBSECTION, AGAINST THE TAXES IMPOSED BY THIS ARTICLE, PROVIDED THAT SUCH TAXPAYER HAS NOT APPLIED FOR OR RECEIVED A REFUND OF SUCH TAXES PURSUANT TO SECTION ELEVEN HUNDRED THIR- TY-NINE OF THIS CHAPTER. FOR PURPOSES OF THIS SUBSECTION, THE TERM "ENERGY STAR PRODUCTS" SHALL HAVE THE SAME MEANING AS IN PARAGRAPH THIR- TY-NINE OF SUBDIVISION (B) OF SECTION ELEVEN HUNDRED ONE OF THIS CHAP- TER. (2) AMOUNT OF CREDIT. THE AMOUNT OF CREDIT SHALL EQUAL THE AMOUNT OF TAXES PAID BY THE TAXPAYER PURSUANT TO ARTICLES TWENTY-EIGHT AND TWEN- TY-NINE OF THIS CHAPTER FOR THE PURCHASE OR REPAIR OF ENERGY STAR PRODUCTS, AS EVIDENCED BY DATED RECEIPTS LISTING THE VENDOR'S NAME, VENDOR'S ADDRESS, AND THE AMOUNT OF SUCH TAX PAID, LESS ANY AMOUNT OF SUCH TAXES THAT THE TAXPAYER DEDUCTED FOR FEDERAL INCOME TAX PURPOSES. (3) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS WILL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED IN ACCORDANCE WITH THE PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST WILL BE PAID THEREON. (4) RECAPTURE OF CREDIT. ANY AMOUNT OF CREDIT ALLOWED PURSUANT TO THIS SUBSECTION FOR WHICH THE TAXPAYER SUBSEQUENTLY RECEIVES A REFUND PURSU- ANT TO SECTION ELEVEN HUNDRED THIRTY-NINE OF THIS CHAPTER SHALL BE RECAPTURED AND ADDED BACK IN THE TAXABLE YEAR THAT SUCH REFUND WAS RECEIVED. S 4. Subdivision (b) of section 1101 of the tax law is amended by adding a new paragraph 39 to read as follows: (39) ENERGY STAR PRODUCT. ANY TANGIBLE PERSONAL PROPERTY FOR WHICH THE ENERGY STAR LABEL HAS BEEN AWARDED BY THE UNITED STATES ENVIRONMENTAL PROTECTION AGENCY PURSUANT TO THE ENERGY STAR PROGRAM (SECTION 6294A OF TITLE 42 OF THE UNITED STATES CODE).
S 5. Subdivision (a) of section 1115 of the tax law is amended by adding a new paragraph 44 to read as follows: (44) RETAIL SALES OF ENERGY STAR PRODUCTS PURCHASED ON OR AFTER OCTO- BER THIRTY-FIRST, TWO THOUSAND TWELVE AND BEFORE OCTOBER THIRTY-FIRST, TWO THOUSAND THIRTEEN. THE EXEMPTION PROVIDED FOR IN THIS PARAGRAPH SHALL NOT APPLY TO THE RENTAL OR LEASING OF SUCH ENERGY STAR PRODUCTS. S 6. Section 1115 of the tax law is amended by adding a new subdivi- sion (ii) to read as follows: (II) SERVICES OTHERWISE TAXABLE UNDER PARAGRAPH THREE OR FIVE OF SUBDIVISION (C) OF SECTION ELEVEN HUNDRED FIVE OR UNDER SECTION ELEVEN HUNDRED TEN OF THIS ARTICLE AND ANY TANGIBLE PERSONAL PROPERTY OTHERWISE TAXABLE UNDER SECTION ELEVEN HUNDRED FIVE OF THIS ARTICLE THAT IS USED IN THE PERFORMANCE OF SUCH SERVICES SHALL BE EXEMPT FROM ANY TAX IMPOSED PURSUANT TO SUCH PROVISIONS WHERE SUCH SERVICES ARE RENDERED DIRECTLY TO ENERGY STAR PRODUCTS AND SUCH SERVICES WERE PROVIDED ON OR AFTER OCTOBER THIRTY-FIRST, TWO THOUSAND TWELVE AND BEFORE OCTOBER THIRTY-FIRST, TWO THOUSAND THIRTEEN. S 7. Section 1139 of the tax law is amended by adding a new subdivi- sion (i) to read as follows: (I) NOTWITHSTANDING ANY PROVISION OF THE LAW TO THE CONTRARY, THE COMMISSIONER SHALL REFUND ANY TAX PAID PURSUANT TO THIS ARTICLE FOR THE PURCHASE OR REPAIR OF ENERGY STAR PRODUCTS THAT ARE EXEMPT FROM THE TAXES PURSUANT TO PARAGRAPH FORTY-FOUR OF SUBDIVISION (A) AND SUBDIVI- SION (II) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS ARTICLE, AS EVIDENCED BY DATED RECEIPTS LISTING THE VENDOR'S NAME, VENDOR'S ADDRESS, AND THE AMOUNT OF SUCH TAX PAID; PROVIDED THAT THE TAXPAYER HAS NOT CLAIMED A CREDIT FOR SUCH TAXES PURSUANT TO EITHER SUBDIVISION FORTY-SIX OF SECTION TWO HUNDRED TEN OR SUBSECTION (VV) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER. ALL THE PROVISIONS OF THIS SECTION SHALL APPLY TO THE REFUND AUTHORIZED BY THIS SUBDIVISION, PROVIDED, HOWEVER, THAT INTEREST ALLOWABLE UNDER SUBDIVISION (D) OF THIS SECTION SHALL BE PAYABLE FROM THE DATE WHICH IS SIX MONTHS AFTER THE DATE THE APPLICATION FOR REFUND IN PROCESSIBLE FORM IS RECEIVED. S 8. The tax law is amended by adding a new section 1261-b to read as follows: S 1261-B. REIMBURSEMENT FOR LOST REVENUE RESULTING FROM EXEMPTIONS FROM TAXES ADMINISTERED BY THE COMMISSIONER. ALL AMOUNTS THAT WOULD HAVE BEEN COLLECTED AND DEPOSITED PURSUANT TO SECTION TWELVE HUNDRED SIXTY-ONE OF THIS PART IF THE EXEMPTIONS PROVIDED BY PARAGRAPH FORTY-FOUR OF SUBDIVISION (A) AND SUBDIVISION (II) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS ARTICLE HAD NOT BEEN ENACTED SHALL BE DEPOSITED IN ACCORDANCE WITH THE PROVISIONS OF SECTION TWELVE HUNDRED SIXTY-ONE OF THIS PART, PROVIDED THAT SUCH DEPOSITS SHALL BE MADE NO LATER THAN ONE DAY AFTER THE COMMISSIONER HAS EITHER (A) ALLOWED CREDIT PURSUANT TO EITHER SUBDIVISION FORTY-SIX OF SECTION TWO HUNDRED TEN OR SUBSECTION (VV) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER, OR (B) ISSUED A REFUND PURSUANT TO SECTION ELEVEN HUNDRED THIRTY-NINE OF THIS CHAPTER, AND PROVIDED FURTHER THAT, NOTWITHSTANDING ANY PROVISION OF THE LAW TO THE CONTRARY, ANY AMOUNTS PAID THAT WERE SUBSEQUENTLY RECAPTURED PURSUANT TO EITHER SUBDIVISION FORTY-SIX OF SECTION TWO HUNDRED TEN OR SUBSECTION (VV) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER SHALL BE DEDUCTED FROM THE AMOUNT TO BE DEPOSITED PURSUANT TO SECTION TWELVE HUNDRED SIXTY-ONE OF THIS PART NO LATER THAN ONE DAY AFTER SUCH AMOUNTS HAVE BEEN RECAP- TURED. S 9. This act shall take effect immediately.

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