Relates to the tax on receipts derived from removing waste from certain transfer stations or debris processing facilities.
TITLE OF BILL: An act relating to the sales and compensating use tax on receipts derived from removing waste material from certain regulated transfer stations or construction and demolition debris processing facilities
PURPOSE: To reaffirm the intention of the legislature that the services of removing waste material from a waste transfer station or a construction and demolition debris processing facility, where the waste removed was not generated by said facility, was not subject to New York State and local sales taxes as the service of maintaining, servicing or repairing the real property of those facilities, and ensure a uniform policy with regard to such services.
SUMMARY OF PROVISIONS: Section 1 of the bill provides that any liability for state and local sales and compensating use taxes with respect to the services of removing waste material from a waste transfer station or construction and demolition debris processing facility regulated by the NYS Department of Environmental Conservation, where the waste removed was not generated by said facility, for assessments made after April 1, 1997.
Section 2 of the bill provides that the act shall take effect immediately.
JUSTIFICATION: One of the categories of enumerated services that are subject to sales tax is the maintaining, servicing or repairing of real property. These are services that relate to keeping real property in a condition of fitness, efficiency, readiness or safety, or restoring it to such condition. Examples of such services would be painting, lawn maintenance and tree spraying as well as plumbing or electrical repairs. The removal of trash or garbage is also considered to be such a taxable service.
Once trash is taken from a home or business property, it is often taken to a transfer station, regulated by the NYS Department of Environmental Conservation, where it is sorted and combined with refuse taken from other facilities so that it can be economically shipped in bulk to its ultimate destination. Previously, the question was raised as to whether this subsequent bulk shipment was merely a nontaxable transportation service or should be considered by itself as a taxable maintenance service to the real property of the transfer station. In May of 1997, an Advisory Opinion was issued by the Department of Taxation and Finance that considered it to be such a taxable service. TSB-A97(32)S.
That Advisory Opinion contains a strained interpretation of the Tax Law that is beyond that contemplated by the Legislature when it sought to impose a tax on the services of maintaining real property. For that reason, the legislature passed a law in 2005 to specifically exclude such services from taxation. This bill seeks to address the tax status for the services of such waste removal from a transfer
station for the period between the issuance of the Advisory Opinion and the effective date of Chapter 321 of the Laws of 2005 to solidify one cohesive policy and cease the continued application of sales and compensating use tax by the Department of Taxation and Finance for this period.
FISCAL IMPLICATIONS: To be determined.
PRIOR LEGISLATIVE HISTORY: This is a new bill.
EFFECTIVE DATE: This act shall take effect immediately.
STATE OF NEW YORK ________________________________________________________________________ 5235--A Cal. No. 1193 2011-2012 Regular Sessions IN SENATE May 3, 2011 ___________Introduced by Sens. MARTINS, GOLDEN, JOHNSON, ZELDIN -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations -- recommitted to the Commit- tee on Investigations and Government Operations in accordance with Senate Rule 6, sec. 8 -- reported favorably from said committee and committed to the Committee on Finance -- committee discharged and said bill committed to the Committee on Rules -- reported favorably from said committee, ordered to a third reading, passed by Senate and delivered to the Assembly, recalled, vote reconsidered, restored to third reading, amended and ordered reprinted, retaining its place in the order of third reading AN ACT relating to the sales and compensating use tax on receipts derived from removing waste material from certain regulated transfer stations or construction and demolition debris processing facilities THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Notwithstanding the provisions of chapter 321 of the laws of 2005, any liability for state and local sales and compensating use taxes, and any interest or penalties thereon, for services specified in clause (iv) of paragraph 5 of subdivision (c) of section 1105 of the tax law, with respect to assessments made after March 1, 1997, whether or not any assessment for such taxes, interest or penalties have been finally or irrevocably fixed by administrative or judicial proceedings, shall hereby be cancelled and annulled, provided, however, that any taxes, interest or penalty heretofore paid with respect to such services shall not be entitled to be credited or refunded. S 2. This act shall take effect immediately.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD10194-06-2