Provides that issuers of debit and credit cards shall pay sales and use taxes directly to the state tax commission.
Law Section: Tax Law
Law: Add S1168, Tax L
Co-sponsor(s): SQUADRONCommittee: INVESTIGATIONS AND GOVERNMENT OPERATIONS
Law Section: Tax Law
Law: Add S1168, Tax L
- Jan 4, 2012: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
- Mar 22, 2011: DEFEATED IN INVESTIGATIONS AND GOVERNMENT OPERATIONS
- Feb 22, 2011: NOTICE OF COMMITTEE CONSIDERATION - REQUESTED
- Jan 5, 2011: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
S347-2011 MeetingsInvestigations and Government Operations: Mar 22, 2011
VOTE: COMMITTEE VOTE: - Investigations and Government Operations - Mar 22, 2011
BILL NUMBER:S347 TITLE OF BILL: REVISED 12/30/11 An act to amend the tax law, in relation to requiring issuers of credit cards and debit cards to pay and collect sales and use taxes and pay such taxes to the commissioner of taxation and finance PURPOSE: To enhance the administration and enforcement of sales tax by including credit card processors as the prime entity with the fiduciary duty to remit the New York State sales tax. Processors are those entities who for a fee remit credit card and debit card receipts from vendors to the issuers of such credit/debit cards then remit collection of such payments on behalf of the vendors. SUMMARY OF PROVISIONS: Section 1 of the bill includes processors of credit and or debit card payments to vendors as the entity primarily responsible for the duty to collect and remit to the state, all sales taxes due on items purchased with credit and or debit cards. Vendors who sell to the public shall remain responsible to correctly report and maintain true records of the value of goods sold. Section 2 of the bill provides for a refund or credit in the event that such is due and owing when goods which are returned to the vendor. JUSTIFICATION: A major source of failure to comply with New York State sales taxes being remitted to the state from vendors who collect such taxes from their customers, is the current system which relies solely upon the thousands of vendors to voluntarily remit such sales taxes. New York State cannot possibly audit every vendor and the vendors know this. But the processors which are paid by vendors to deal with the issuers of credit and or debit cards, and who actually get the monies from the credit card issuers, are far less numerous. They know the true sales and actually get money from the credit card companies which includes the sales taxes. It is more efficient to have these processors remit the sales taxes directly to New York state instead of sending the taxes back to the vendors and then relying upon the vendors to timely and accurately submit the sales taxes. LEGISLATIVE HISTORY: 2011: S.347 - Defeated in Investigations and Government Operations 2010: S.2550A/A.7674 Referred to Investigations and Government Operations/Referred to Ways and Means 2009: S.2550A/A.7674 Tabled/Referred to Ways and Means 2008: S.774/A.9991 Referred to Investigations and Government Operations/Referred to Ways and Means 2007: S.774 Referred to Investigations and Government Operations 2005-06: S.827 Referred to Investigations and Government Operations 2003-04: S.4362 Referred to Investigations and Government Operations EFFECTIVE DATE: This law shall take effect on the first of October next succeeding the date on which it shall have become a law, with provisions.
S T A T E O F N E W Y O R K ________________________________________________________________________ S. 347 A. 156 2011-2012 Regular Sessions SENATE - ASSEMBLY (PREFILED) January 5, 2011 ___________ IN SENATE -- Introduced by Sen. DIAZ -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations IN ASSEMBLY -- Introduced by M. of A. KAVANAGH -- read once and referred to the Committee on Ways and Means AN ACT to amend the tax law, in relation to requiring issuers of credit cards and debit cards to pay and collect sales and use taxes and pay such taxes to the commissioner of taxation and finance THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS:
Section 1. The tax law is amended by adding a new section 1168 to read as follows:
S 1168. COLLECTION AND PAYMENT OF TAXES BY PROCESSORS OF CREDIT CARDS AND DEBIT CARDS. (A) NOTWITHSTANDING ANY LAW, RULE OR REGULATION TO THE CONTRARY, AN ISSUER OF CREDIT CARDS OR DEBIT CARDS, AS DEFINED IN SECTION FIVE HUNDRED ELEVEN OF THE GENERAL BUSINESS LAW, SHALL COLLECT AND PAY TAXES IMPOSED BY ARTICLES TWENTY-EIGHT AND TWENTY-NINE OF THIS CHAPTER, AND SHALL BE SUBJECT TO ALL PROVISIONS OF SUCH ARTICLES AS A PERSON REQUIRED TO COLLECT TAX, AS DEFINED IN SUBDIVISION ONE OF SECTION ELEVEN HUNDRED THIRTY-ONE OF THIS CHAPTER ON ALL TRANSACTIONS CONDUCTED WITH A CREDIT OR DEBIT CARD OF THE ISSUER, PROVIDED, HOWEVER, NOTWITH- STANDING ANY LAW, RULE OR REGULATION TO THE CONTRARY, SUCH TAXES SHALL BE PAID DIRECTLY TO THE COMMISSIONER BY THE ISSUER. (B) NOTWITHSTANDING ANY LAW, RULE OR REGULATION TO THE CONTRARY, ON ANY TRANSACTION CONDUCTED WITH A DEBIT OR CREDIT CARD OF THE ISSUER, WHEREIN THE ISSUER IS REQUIRED TO COLLECT AND PAY TAXES PURSUANT TO SUBDIVISION (A) OF THIS SECTION, THE VENDOR OF TANGIBLE PERSONAL PROPER- TY OR SERVICES INVOLVED IN SAID TRANSACTION SHALL NOT BE REQUIRED TO PAY EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD00836-01-1 S. 347 2 A. 156 AND COLLECT TAXES PURSUANT TO ARTICLES TWENTY-EIGHT AND TWENTY-NINE OF THIS CHAPTER, RATHER THIS DUTY SHALL BE IMPOSED UPON PROCESSORS. (C) FOR PURPOSES OF THIS SECTION, PROCESSOR SHALL MEAN ANY ENTITY WHICH CONTRACTS WITH VENDORS TO PROCESS THEIR CREDIT CARD RECEIPTS AND WHO FOR A FEE, OBTAIN FUNDS FOR VENDORS FROM SUCH ISSUERS OF CREDIT OR DEBIT CARDS. S 2. This act shall take effect on the first of October next succeed- ing the date on which it shall have become a law. Effective immediately, any rules and regulations necessary for the timely implementation of this act on its effective date may be promulgated on or before such date.