Bill S4736A-2011

Increases the presumed "cost of the agent" for purposes of cigarette marketing

Increases the presumed "cost of the agent" for purposes of cigarette marketing.

Details

Actions

  • Jun 12, 2012: referred to ways and means
  • Jun 12, 2012: DELIVERED TO ASSEMBLY
  • Jun 12, 2012: PASSED SENATE
  • Jun 12, 2012: ORDERED TO THIRD READING CAL.1192
  • Jun 12, 2012: COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • May 22, 2012: REPORTED AND COMMITTED TO FINANCE
  • Jan 9, 2012: PRINT NUMBER 4736A
  • Jan 9, 2012: AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • Jan 4, 2012: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • Jan 4, 2012: returned to senate
  • Jan 4, 2012: died in assembly
  • Jun 21, 2011: referred to ways and means
  • Jun 21, 2011: DELIVERED TO ASSEMBLY
  • Jun 21, 2011: PASSED SENATE
  • Jun 21, 2011: ORDERED TO THIRD READING CAL.1469
  • Jun 21, 2011: COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • Apr 18, 2011: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Meetings

Calendars

Votes

VOTE: COMMITTEE VOTE: - Investigations and Government Operations - May 22, 2012
Ayes (5): Marcellino, Golden, Zeldin, Diaz, Peralta
Ayes W/R (3): Alesi, Nozzolio, Squadron
VOTE: COMMITTEE VOTE: - Rules - Jun 12, 2012
Ayes (16): Skelos, Alesi, Farley, Fuschillo, Johnson, Larkin, Libous, Marcellino, Maziarz, Nozzolio, Seward, Sampson, Breslin, Dilan, Smith, Stewart-Cousins
Ayes W/R (5): LaValle, Duane, Montgomery, Parker, Perkins
Nays (3): Hannon, Saland, Hassell-Thompson
Excused (1): Krueger

Memo

BILL NUMBER:S4736A

TITLE OF BILL: An act to amend the tax law, in relation to increasing the presumed "cost of the agent" relating to cigarette marketing standards

PURPOSE: Increases the presumed "cost to the agent" for purposes of cigarette marketing.

SUMMARY OF SPECIFIC PROVISIONS: Section 1: Amends subparagraph (B) of paragraph 1 of subdivision (b) of section 483 of the tax law, as amended by chapter 1 of the laws of 1999, to provide that the presumed cost of doing business by the agent selling to a wholesale dealer shall increase from seven-eighths of one percent of the basic cost of cigarettes plus two cents to seven-eighths of one percent of the basic cost of cigarettes plus fourteen cents for a standard pack of 20 cigarettes. For sales to chain stores, the presumed cost of doing business shall increase from one and one-half percent of the basic cost of cigarettes plus two cents to one and one-half percent of the basic cost of cigarettes plus fourteen cents for a standard pack of 20 cigarettes. For sales to retail dealers, the presumed cost of doing business shall increase from three and seven-eighths percent of the basic cost of cigarettes plus two cents to three and seven-eighths percent of the basic cost of cigarettes plus fourteen cents for a standard pack of 20 cigarettes.

Section 2: Effective date.

JUSTIFICATION: Increased cigarette and tobacco excise taxes and the burden of pre-payment of cigarette sales taxes, which have increased eight-fold since the inception in addition to a variety of other factors, have caused the "presumed cost of doing business" of the tax agents to require an adjustment of 12 cents to the 15 year old handling fee of 2 cents per pack of 20 cigarettes. This will enable the remaining tax agents to remain in business and help secure tax collection.

Note: In each instance where a pack contains 20 cigarettes, the increase is from two cents to fourteen cents. Where a pack contains 25 cigarettes, the handling fee is increased from two cents to seventeen cents. Where a pack contains 10 cigarettes, the handling fee is increased from one cent to seven cents.

PRIOR LEGISLATIVE HISTORY: New bill.

FISCAL IMPLICATIONS: The increase in handling fees will preserve the almost Two Billion Dollars in revenue that the Cigarette Tax Agents collect for the State of New York every year and will ensure viability of the excise tax collection process which has been severely damaged by the increased costs of doing business and the loss of volume due to sales by illegal untaxed sources. By not increasing the handling fees, the State of New York may risk losing even more of its

Cigarette Tax Agents and thereby further deteriorate the tax collection methodology expressed in Article 483 of the Tax Code. A further deterioration of the tax collection process will lead to less revenue collected and more cartons sold through illegal untaxed Sources. Furthermore, this slight increase of 12 cents per pack of 20 cigarettes will have no effect on the amount of taxed cartons sold within the State of New York.

EFFECTIVE DATE: This act shall take effect July 1, 2012; provided, however, that if this act shall not have become a law on or before July 1, 2012, then this act shall take effect immediately and shall be deemed to have been in full force and effect on and after July 1, 2012.


Text

STATE OF NEW YORK ________________________________________________________________________ 4736--A 2011-2012 Regular Sessions IN SENATE April 18, 2011 ___________
Introduced by Sen. GOLDEN -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Govern- ment Operations -- recommitted to the Committee on Investigations and Government Operations in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the tax law, in relation to increasing the presumed "cost of the agent" relating to cigarette marketing standards THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subparagraph (B) of paragraph 1 of subdivision (b) of section 483 of the tax law, as amended by chapter 1 of the laws of 1999, is amended to read as follows: (B) In the absence of the filing with the commissioner of satisfactory proof of a lesser cost of doing business of the agent making the sale, the cost of doing business by the agent shall be presumed to be seven- eighths of one percent of the basic cost of cigarettes for sales to wholesale dealers plus [one cent] SEVEN CENTS per package of ten ciga- rettes, [two] FOURTEEN cents per package of twenty cigarettes and in the case of a package containing more than twenty cigarettes, [two] SEVEN- TEEN cents and one-half of a cent for each five cigarettes in excess of twenty cigarettes, one and one-half percent of the basic cost of ciga- rettes for sales to chain stores plus [one cent] SIX CENTS per package of ten cigarettes, [two] TWELVE cents per package of twenty cigarettes and in the case of a package containing more than twenty cigarettes, [two] SEVENTEEN cents and one-half of a cent for each five cigarettes in excess of twenty cigarettes and three and seven-eighths percent of the basic cost of cigarettes with respect to sales to retail dealers plus [one cent] SIX CENTS per package of ten cigarettes, [two] TWELVE cents per package of twenty cigarettes and in the case of a package containing more than twenty cigarettes, [two] SEVENTEEN cents and one-half of a
cent for each five cigarettes in excess of twenty cigarettes and the foregoing cents per pack shall be included in the "cost of doing busi- ness by the agent" referred to in paragraphs two and three of this subdivision. S 2. This act shall take effect July 1, 2012; provided, however, that if this act shall not have become a law on or before July 1, 2012, then this act shall take effect immediately and shall be deemed to have been in full force and effect on and after July 1, 2012.

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