S6259B-2011 Actions

• Mar 30, 2012: SUBSTITUTED BY A9059D
• Mar 29, 2012: ORDERED TO THIRD READING CAL.486
• Mar 27, 2012: PRINT NUMBER 6259D
• Mar 27, 2012: AMEND (T) AND RECOMMIT TO FINANCE
• Mar 11, 2012: PRINT NUMBER 6259C
• Mar 11, 2012: AMEND (T) AND RECOMMIT TO FINANCE
• Feb 17, 2012: PRINT NUMBER 6259B
• Feb 17, 2012: AMEND (T) AND RECOMMIT TO FINANCE
• Feb 10, 2012: PRINT NUMBER 6259A
• Feb 10, 2012: AMEND AND RECOMMIT TO FINANCE
• Jan 17, 2012: REFERRED TO FINANCE

S6259B-2011 Votes

S6259B-2011 Memo

BILL NUMBER:S6259

TITLE OF BILL:

An act
to amend chapter 540 of the laws of 1992, amending the real property tax
law relating to oil and gas charges, in relation to the effective date
of such chapter (Part A);
to amend the real property tax law,
the tax law, the administrative code of the city of New York and the
state finance law, in relation to the suspension of
STAR exemptions and related benefits
of persons who are delinquent
in the payment of outstanding state tax
liabilities (Part B);
to amend the tax law, in relation
to reforming excise tax on
tobacco products, imposing a
fixed rate of tax on loose
tobacco, and imposing a retail
tax on cigars (Part C);
to amend chapter 109 of the laws of 2006, amending the tax law
relating to providing exemptions, reimbursements and credits from
various taxes for certain alternative fuels,
in relation to extending the alternative fuels tax exemptions
(Part D);
to amend the tax law, in relation
to making technical amendments to the tax
treatment of diesel fuel to reflect
industry practice (Part E);
to amend the tax law, in relation to the power of the commissioner of
taxation and finance to
refuse to issue a certificate of authority to collect the sales and
compensating use taxes imposed by article 28 of the tax law
and pursuant to the
authority of article 29 of the tax law (Part F);
to amend the tax law and part U of chapter 61 of the laws of 2011,
amending the real property tax law, the general municipal law, the
public officers law, the tax law, the abandoned property law, the state
finance law and the administrative code of the city of New York,
relating to establishing standards for electronic real property tax
administration, allowing the department of taxation and finance to use
electronic communication means to furnish tax notices and other
documents, mandatory electronic filing of tax documents, debit cards
issued for tax refunds, improving sales tax compliance and repealing
certain provisions of the tax law and the administrative code of the
city of New York relating thereto,
in relation to making permanent, provisions
relating to mandatory electronic filing of tax documents and
improving sales tax compliance; and to repeal certain provisions
of the tax law and the administrative code of the city of New
York relating thereto (Part G);

to amend the tax law, in relation to the personal income tax credits for
solar energy systems equipment and the sales and use tax exemption
provided for such equipment (Part H);
to amend the tax law, in relation to extending the empire state
commercial production tax credit; and to amend part V of chapter 62 of
the laws of 2006 relating to the empire state commercial production tax
credit, in relation to the effectiveness thereof (Part I);
to amend
the public housing law, in relation to the credit against income tax for
persons or entities investing in low-income housing (Part J);
to amend the tax law, in relation to extending the biofuel production tax
credit; and to amend part X of chapter 62 of the laws of 2006, amending
the tax law relating to providing tax credits for biofuel production
plants, in relation to the effectiveness thereof (Part K);
to amend chapter 58 of the laws of 2006, relating to providing an
enhanced earned income tax credit, in relation to the effectiveness
thereof (Part L);
to amend the civil practice law and rules and the debtor and creditor
law, in relation to prohibiting banking institutions from deducting
levy processing fees from tax and child support levy
proceeds (Part M);
to amend the tax law, in relation to tax rates and exclusions under the
metropolitan commuter transportation mobility tax for professional
employer organizations and to amend part B of chapter 56 of the laws of
2011 amending the tax law relating to the tax rates and exclusions under
the metropolitan commuter transportation mobility tax, in relation to
the effectiveness thereof (Part N);
to amend the racing, pari-mutuel wagering and breeding law, in
relation
to licenses for simulcast facilities, sums relating to track
simulcast,
simulcast of out-of-state thoroughbred races, simulcasting of races
run by
out-of-state harness tracks and distributions of wagers; to amend
chapter
281 of the laws of 1994 amending the racing, pari-mutuel wagering and
breeding
law and other laws relating to simulcasting and chapter 346 of
the laws
of 1990 amending the racing, pari-mutuel wagering and breeding law
and other
laws relating to simulcasting and the imposition of certain taxes, in
relation
to extending certain provisions thereof; to amend the racing,
pari-mutuel
wagering and breeding law, in relation to extending certain
provisions
thereof (Part O); and
to amend the tax law, in relation to the
distribution of revenue collected
from the corporate and utilities taxes imposed under sections
183 and 184 of the tax law (Part P)

PURPOSE:

This bill contains provisions needed to implement the Revenue portion
of the 2012-13 Executive Budget.

This memorandum describes Parts A through P of the 2012-13 Article VII
Revenue bill which are described wholly within the parts listed below.

Part A - Extend fees for the establishment of oil and gas unit of
production values.

Purpose:

This bill would extend fees for the establishment of oil and gas unit
of production values by the Department of Taxation and Finance (the
Department).

Statement in Support, Summary of Provisions, Existing Law and
Prior Legislative History:

The Department establishes "unit of production values" which local
assessors must use when assessing oil and gas wells and related
facilities, pursuant to Article 5, Title 5 of the Real Property Tax
Law. This program, which has been in place since 1981, relieves local
assessors of the burden of attaining the necessary expertise to value
these properties, while assuring producers that their assessments
will be determined on a uniform, rational basis throughout the State.

In recognition of the benefit this program provides for the industry,
producers have been obliged since 1992 to pay fees to the State to
offset the administrative costs involved in developing these values.
The statute imposing those fees - Real Property Tax Law �593 - has
always been subject to a sunset clause, and has been repeatedly
renewed since enactment. This bill would extend the program until 2015.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13
Executive Budget and allow the Department to offset related costs.

Effective Date:

This bill takes effect immediately.

Part B - STAR benefit recovery program for unpaid tax liabilities.

Purpose:

This bill would create a new program to aid in the enforcement of
delinquent tax liabilities by providing for the recovery of STAR
benefits from taxpayers who owe certain past-due tax liabilities.

Statement in Support, Summary of Provisions, Existing Law,
and Prior Legislative History:

This bill would authorize the Department of Taxation and Finance to
establish a new program to aid in the enforcement of delinquent tax
liabilities by providing for the recovery of STAR benefits from
taxpayers who owe certain past-due state tax liabilities.
The program would apply to the STAR exemption from real property
taxation and to the two STAR-related personal income tax benefits for
New York City residents.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget since it would provide an estimated $1 million in additional
revenue on an annual basis and $5 million in savings, by removing the
STAR exemption in cases in which the taxpayer(s) were in arrears with
respect to their State tax liabilities.

Effective Date:

This bill would take effect immediately, provided however, the
provisions relating to the personal income tax in New York City would
apply to taxable years beginning on and after January 1, 2012.

Part C - Reform the Tobacco Products Excuse Tax.

Purpose:

This bill would amend the Tax Law, in relation to reforming excise tax
on tobacco products, imposing a fixed rate of tax on loose tobacco,
and imposing a retail tax on cigars.

Statement in Support, Summary of Provisions, Existing Law,
and Prior Legislative History:

Using commercial roll-your-own machines at a retail location to make
cigarettes is the newest trend in the tobacco industry. It is an
alternative way to manufacture cigarettes while paying the lower
tobacco products excise tax rather than the generally much higher
cigarette excise tax. These machines use loose tobacco to fill tubes
to create cigarettes in minutes rather than in hours if done on home
filling machines. Purchasers are often choosing lower taxed tobacco
products like pipe tobacco to use in the machines to save even more
money. The bill would tax all loose tobacco at the same rate as the
excise tax on cigarettes to provide a disincentive for consumers to
seek out these machines.

This bill would also reform the excise tax on tobacco products and
impose a retail tax on cigars.

Sections 1, 19 through 34, and 35-45 of the bill would make conforming
changes to Article 20 by adding the term "cigars" wherever the term
"tobacco products" is used, because cigars would be taxed separately
from tobacco products. 'Additionally, the term "wholesale price"
would be removed and replaced with weight for record keeping
purposes. In several sections, the threshold for cigars would be
adjusted in keeping with section 21.

Sections 2 through 9 of the bill would amend section 470 of the Tax
Law to remove cigars from the definition of tobacco products and to
make conforming changes to other related definitions to reflect this
change. The definition for snuff is expanded to reflect the new
products in the marketplace that are most closely defined as snuff. A
definition of loose tobacco is added to include all tobacco products
other than snuff and little cigars. The definition of receipts is
added in order to impose the new cigar excise tax at the retail level.

Section 10 of the bill would amend section 471 (b)(1 )(a) to eliminate
the imposition of the tobacco products tax at seventy-five percent of
the wholesale price, and replaces it with a fixed rate of $4.53 per
ounce on loose tobacco. This rate brings the tax rate up to par with
the imposition on cigarettes.

Section 11 of the bill would add a sunset of June 1, 2012 for the
imposition of the tobacco products tax on cigars. This would allow
for a month where there is no tax on
cigars in order to provide a period of time to sell down inventories
before the imposition of the new cigar excise tax.

Section 12 would make conforming changes to the use tax.

Sections 13 and 14 of the bill would add a new cigar excise tax as
section 471-f of the Tax Law and cigar use tax as section 471-g of
the Tax Law that is imposed at the rate of fifty percent on the
receipts from every retail sale and collected by the retail dealer or
paid by the consumer.

Sections 15 and 16 of the bill would add a cigar prepaid tax paid by
the distributor at the rate of 20 cents per cigar processed for use
or sale in the state, and allow for a refund or credit with respect
to the prepaid tax.

Sections 17 and 18 of the bill would add sections 471-j and 471-k to
the bill to address some administration provisions for the cigar
excise tax.

Section 21 of the bill would amend section 474 of the Tax Law to lower
the threshold for the invoice requirement from more than 250 cigars
to more than 50 cigars to make the amount similar to the requirement
for cigarettes.

Section 31 of the bill would amend section 480-a(2)(d) by
incorporating by reference the sales tax certificate of authority
penalties contained in section 1134 of the Tax Law to be similarly
applicable to a certification of registration.

Section 37 of the bill would add section 481-a to the Tax law to
establish parallel relevant penalties for retail dealers as are found
in section 1145 of the Tax Law.

Section 46 of the bill provides that the bill would take effect July
1, 2012, except that section 11 of the bill would take effect
immediately.

Budget Implications:

Enactment of this bill is necessary to implement the Executive Budget,
because it will increase tax receipts by $18 million in SFY 2012-13
and $24 million each year thereafter.

Effective Date:

This bill takes effect July 1, 2012 except that section 11 takes
effect immediately.

Part D - Extend the alternative fuels tax exemptions for five years.

Purpose:

This bill would extend the sunset from September 1, 2012 to September
1, 2017 for the tax exemptions for alternative fuels, including E85,
CNG, hydrogen, and B20.

Statement in Support, Summary of Provisions,. Existing Law and
Prior Legislative History:

Extending the exemptions for alternative fuel would continue to
provide an incentive for the use of renewable fuels and is part of a
comprehensive strategy to reduce dependence on foreign oil and to
increase the use of clean energy fuels.

This bill would extend the sunset for the exemptions in the Tax Law
for alternative fuels from September 1, 2012 to September 1, 2017.
Unless this sunset is extended, the Tax Law will no longer allow full
exemptions for E85, CNG, and hydrogen, and partial exemptions for B20
from the motor fuel taxes (Article 12-A), the petroleum business
taxes (Article 13-A), fuel use taxes (Article 21-A) and State and
local sales and compensating use taxes (Articles 28 and 29).

Existing law includes an exemption for E85, CNG and hydrogen, and a
partial exemption for B20. This exemption is set to sunset on
September 1, 2012.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget. All Funds sales and use, petroleum business, and motor fuel
taxes would be reduced by a total of $1.5 million in SFY 2012-13 and
$3 million annually in each of 2013-14, 2014-15, 2015-16 and 2016-17
and $1.5 million in 2017-18.

Effective Date:

This bill takes effect immediately.

Part E - Make technical amendments to the tax classification of diesel
motor fuel.

Purpose:

This bill would amend how certain types of diesel motor fuel are
classified for purposes of the taxes on diesel motor fuel under the
New York State Tax Law.

Statement in Support, Summary of Provisions, Existing Law and
Prior Legislative History:

Section 1 of the bill would delete crude oil from the definition of
diesel motor fuel in section 282.14 of Article 12-A of Tax Law and,
by virtue of cross references, Articles 13-A, 28 and 29 of the Tax
Law. Section 3 of the bill would remove the exemption for crude oil
from Article 13-A of the Tax Law as it is no longer subject to tax.

Sections 2 and 4 through 6 of the bill would amend the Tax Law to
allow a distributor of diesel motor fuel to sell undyed "qualified
biodiesel" to another distributor of diesel motor fuel without
inclusion of the Article 12-A, 13-A, 28 and 29 taxes. Section six
would also make a technical change to remove the criteria that
non-highway diesel motor fuel cannot be sold without the pre-paid
sales tax if such fuel was previously subject to tax.

The Tax Department became aware of a marketplace problem with the new
Tax Law fuel definitions enacted under Chapter 61 of the Laws of
2011. Under the new diesel fuel definitions, diesel motor fuel
labeled B-100 or B-99 (qualified biodiesel), when undyed, is treated
as highway diesel motor fuel and subject to tax when sold in the
State. Qualified biodiesel (whether dyed or clear) when imported from
outside the State by a registered distributor is not subject to tax
at that point. Rather, the tax is imposed on the first sale in the
State of undyed qualified biodiesel. This bill would allow undyed
qualified biodiesel to be sold in this State without tax between
registered fuel distributors (inter-distributor sales).

While in many cases, the 38 cents per gallon highway tax would be
refunded when the biodiesel is ultimately blended with diesel fuel

and dyed (e;g. for sale in residential market), the cash flow burden
would preclude the in-State seller from competing on price with the
out-of-state seller. This disparate treatment creates an uneven
playing field to the detriment of in-State sellers of biodiesel. An
in-State seller would be offering product priced at about 38 cents
per gallon more expensive than an out of State seller based solely on
tax treatment. This market inequity would appear to handicap the
development of a robust renewable fuels distribution market within
the State.

After enactment of Chapter 61 last year, the Tax Department also
became aware that crude oil, originating in North Dakota, is being
transshipped by rail through New York State with a destination of
refineries in New Jersey and Pennsylvania. To prevent any unintended
tax consequences, this bill would remove crude oil from the diesel
motor fuel Tax Law definition. This change will have no adverse tax
evasion or compliance effects.

Budget Implications:

Enactment of this bill is necessary to address an unintended impact on
taxpayers and to maintain the estimated State revenue stream in State
fiscal year 2012-13 and future fiscal years.

Effective Date:

This bill would take effect June 1, 2012, provided that sections 5 and
6 shall apply to sales made and uses occurring on and after that date
in accordance with the applicable transitional provisions in sections
1106 and 1217 of the Tax Law.

Part F - Expand Criteria to Refuse to Issue Sales Tax Certificates of
Authority.

Purpose:

This bill would improve tax collection by expanding the criteria the
Department of Taxation and Finance uses to refuse to issue a
Certificate of Authority due to outstanding liability under the Tax
Law.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History

Vendors are not permitted to engage in taxable sales without first
being issued a Certificate of Authority from the Department of
Taxation and Finance. Section 1 would amend section 1134(a)(4)(B)of
the Tax Law to expand the.criteria the Department of Taxation and
Finance may use to refuse to issue a Certificate of Authority for
sales and use tax purposes. Current law allows the Department to
refuse to issue a Certificate of Authority if any tax finally
determined to be due from the applicant under the Tax Law has not

been paid in full; or sales or use taxes due from persons required to
collect tax on behalf of this entity, or another entity for which the
person was also required to collect tax, have not been paid in full.
This bill would allow the Department to refuse to issue a Certificate
of Authority for any unpaid type of tax determined to be due from a
person that is a "person required to collect tax" for the entity
applying for the Certificate of Authority, not just for that person's
unpaid sales and use taxes as under current law.

Section 2 would amend section 1146(g) of the Tax Law to allow
disclosure by the Commissioner, to an applicant who has been refused
a Certificate of Authority, of the name and amount of tax due of the
persons required to collect tax whose tax liabilities were grounds
for the Certificate of Authority refusal. This amendment should
result in a payment of tax so the Certificate of Authority may be
issued. This proposal would expand the type of liability checks the
Department currently runs for each new sales tax registration, and
which it successfully executed for all registered sales tax vendors
as part of the re-registration project authorized by the Legislature
as part LL-1 of Chapter 57 of the laws of 2008. This has been an
effective and efficient tool to collect outstanding tax liabilities.
Expanding the scope of these liability checks would enable the
Department to more efficiently collect on additional past due tax
liabilities. There is no legislative history.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget because it will increase receipts by $1 million in SFY 2012-13
and each year thereafter.

Effective Date:

This bill takes effect immediately.

Part G - Make Permanent Certain Modernization Provisions of the Tax law.

Purpose:

Make Tax Modernization Provisions Permanent: (a) To maintain
improvements to the administration of the Tax Department's electronic
filing and payment mandates, creating efficiencies and cost savings;
and (b) to maintain improvements to sales tax compliance tools.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History:

a. Electronic Filing Mandates

Originally, the Tax Law provided for mandates in two separate sections
of the law Section 658(g)(10) for tax preparers of personal income
tax (PIT) returns and Section 29 for all other preparers and for

business self-filers. There were also penalty provisions that applied
directly to those provisions, and corresponding provisions in the
Administrative Code of the City of New York. Last year, the
provisions in part U of Chapter 61 improved the administration of the
Tax Department's electronic filing and payment mandates by
consolidating all preparer and self-filer requirements into one
section of the Tax Law (an amended Section 29), and extended e-filing
requirements to PIT self-filers who use tax software to prepare their
PIT returns. It also imposed appropriate penalties for failure to
comply with the mandates. The bill also repealed sections of the Tax
Law and the Administrative Code of the City of New York that were no
longer needed as a result of its provisions. Currently, these
beneficial e-file mandate provisions would expire on December 31,
2012, at which time, the Tax Law would revert to having two disparate
sections of law setting forth e-file mandate requirements at lower
thresholds than those which would be in place during
the 2012 tax filing season.

This bill would make the very important e-file improvement provisions
enacted last year permanent. Consolidating the e-file and e-pay
mandates into one section of the Tax Law would make the mandate
requirements more readily understandable, eliminating confusion among
self-filers and practitioners that existed previously when the
mandates were set forth in two different sections with different
requirements. The bill would also keep consistent the terminology
used in connection with the mandates. For example,
confusion existed previously because section 29 refers to "authorized
tax documents" while section 658(g)(10)) referred to "authorized
returns." The provisions sought to be made permanent make clear that
both preparer and self-filer mandates cover "authorized tax
documents." To produce further efficiencies and cost savings to the
State, the threshold trigger for the preparer e-file mandate was
reduced in the 2011 legislative session from preparation of 100 tax
documents to preparation of 5 tax documents. Making the provisions
permanent would prevent the State from reverting back to the previous
threshold of 100, which would result in a decline of e-filed returns
in the 2013 tax filing season.

Continuation of these provisions would also maintain the requirement
for tax filing seasons beyond 2012 that PIT self-filers using tax
software to prepare their returns must also e-file them. Requiring
preparers and self-filers that use tax preparation software to e-file
recognizes that persons using tax software to prepare returns are
capable of e-filing. Importantly, Tax Law �34 passed in 2010 (no
separate charge for efiling of a NYS return) means no additional
financial burden may be imposed upon self-filers for the e-filing of a
NYS tax document. Continuing the threshold reduction for preparers
would also be consistent with recent e-file trends (e.g., IRS has
reduced their threshold for the 2012 filing season).

Overall, this bill would maintain for future years the cost savings
realized by the State by the increase in e-filing that is anticipated

during the coming year's tax filing season. Efile and e-pay of taxes
would create cost and tax administration efficiencies beneficial to
both the State and taxpayers. A taxpayer's use of e-file and e-pay
reduces the number of errors that may be associated with the filing
of a paper return. With e-file, an error can be immediately detected
and the taxpayer prompted to correct and resubmit their return.
Also with e-file, the taxpayer gets an official acknowledgement when
their return has been received. Moreover, e-filed tax returns are
processed quicker than paper;
potentially resulting in faster refunds. In addition, the more
taxpayers that e-file and epay, the more cost savings the State would
realize since administrative cost savings are linked to each and
every tax document e-filed with the Department. Currently, these
provisions would expire on December 31, 2012. This bill proposes to
make these very important provisions permanent.

b. Improving Sales Tax Compliance

Last year, Part U of Chapter 61 amended section 1137 of the Tax Law to
authorize the Commissioner to require vendors that (1) failed to
collect, truthfully account for, or (2) pay over sales tax moneys, or
to file returns as required by law, to take actions the Commissioner
deems necessary to ensure that sales tax moneys are paid, including
giving notice to such vendor requiring more frequent payment of tax.
Prior to the enactment of Part U, Section 1137 authorized the
Commissioner to require a noncompliant vendor to deposit sales tax
moneys into a separate account, in trust for and payable to the
Commissioner. However, trust accounts proved to be an ineffective
means of protecting tax revenues because they were difficult to
establish and administer, required multiple signatures and procedural
steps, and also required
cooperation with various banks. The segregated account provisions
enacted last year simplify this process for vendors and the
Department. Under this amendment, vendors set up their own separate
bank account into which only sales tax moneys will be deposited,
authorize the Department to debit that account, and deposit the sales
tax moneys into that account at least weekly.

The Department has begun to implement this amendment, and a recently
completed a statistical analysis indicated that sales tax vendors
selected for the segregated account pilot program made increased
timely payments for the last sales tax quarter of 2011.
The analysis indicates that a positive statistical correlation existed
for payment increases, compared to the prior year, for these vendors
in three of the four industry groups selected for the segregated
accounts pilot project. The statistical study controlled for
differences in payments made by vendors in these industries who were
not selected for participation in the program. For those vendors
selected for the pilot project, the estimated increase in quarterly
payments compared to the prior year was $1,100 per vendor, as
compared with similar vendors in the same industry who were not
selected for the project.

The bill would continue to give the Department a more effective tool
to ensure that trust tax moneys that a vendor has collected for the
State are paid promptly to the Department and not diverted for other
purposes. The segregated account provisions would expire December 31,
2012. This bill would make these very important changes permanent.

Budget Implications:

Enactment of this bill would be necessary to implement the 2012-2013
Executive Budget. It would generate additional All Funds Revenue of
$5 million in SFY 2012-13 and $20 million annually thereafter.

Effective Date:

The bill would take effect immediately, provided however, that section
2 would be deemed to have taken effect on the same date and in the
same manner as the amendments to section 29 of the Tax Law contained
in section 13 of part U of chapter 61 of the laws of 2011 took effect.

Part H - Expand sales tax exemption for solar energy systems equipment
and expand income tax credit for such systems.

Purpose:

This bill would expand the income tax credit and sales and use tax
exemptions for qualified solar energy systems equipment.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History:

In his 2012 State of the State address, the Governor announced the NY
SUN Solar program to expand solar production in the State. This bill
begins to implement the program through expansion of two existing tax
incentives, both of which need to be updated to reflect changing
market conditions in the solar industry, and to further encourage the
development of solar energy systems on commercial properties. Tax
incentives for solar energy installations have proven to be an
effective tool to help achieve the State's policy objectives of
reducing energy costs, improving the environment, and stimulating job
creation in the clean energy economy. This bill further implements
those goals.

First, the Personal Income Tax credit under Tax Law (TL) � 606(g-1)(2)
is available only to those that own solar energy systems. Leased and
third-party systems, however, are gaining in popularity, and should
also be eligible for the current tax credit. Indeed, for some
customers, it will be more feasible to lease the equipment or
contract with a provider to purchase power. The end result -
installed solar energy systems - provides the same societal benefits
regardless of the method of procuring the solar energy systems. The
bill would thus amend TL � 606(g-1)(2) to cover expenditures for the

lease of solar energy equipment and purchases of power generated by
such equipment.

Second, the State sales and use tax exemptions under TL � 1115(ee)
and the local optional sales tax exemption under TL � 1210(a)(1),
(n)(1) are available only to solar energy systems installed on
residential properties. The development of such systems on commercial
properties, however, should also be encouraged; because of the large
rooftops often associated with such properties, as well as their high
energy demand, commercial properties are often well-suited for solar
development. Accordingly, the bill would eliminate this "residential"
requirement, thus expanding the sales tax exemptions to cover systems
used to provide heating/cooling, hot water, or electricity to any
structure, including commercial properties. To align the exemptions
with the State's net metering law, the amended exemptions would apply
only to solar energy equipment that does not exceed an installed
capacity rating of two megawatts or the thermal equivalent thereof.
Of note, under TL � 1218, to avoid having the expanded exemption
apply to its local sales and use tax, the city or county to which the
exemption applies would have to repeal any local law that adopted the
prior exemption for residential systems; i.e., the city or county can
opt out of the exemption.

Budget Implications:

This bill would result in a revenue loss of $2 million in 2012-13 and
$5 million per year thereafter thru 2015-16. Beginning in 2016-17 the
revenue loss will be $3 million per year as a result of the
continuing sales tax exemption. Enactment of this bill is necessary
to implement the 2012-13 Executive Budget because the revenue losses
are included in the State Financial Plan.

Effective Date:

This bill would take effect immediately, provided that:
(1) section 1 of the bill would apply to leases of solar energy
systems equipment and purchases of power under written agreements
entered into on or after the date the bill would become law;
provided, however, that the amendments to paragraph 2 of subsection
(g-1) of the Tax Law made by section 1 shall not apply to any taxable
year commencing on or after January 1, 2015; and (2) sections 2, 3,
and 4 of the bill would apply to sales made or uses occurring on or
after September 1, 2012.

Part I - Extend Empire State Commercial Production Tax Credit for five
years.

Purpose:

This bill would extend the Empire State Commercial Production Credit
until December 31, 2016.

Statement in Support. Summary of Provisions, Existing Law, and
Prior Legislative History:

The Empire State Commercial Production Credit is currently available
for taxable years beginning on or after January 1, 2007 and expires
on December 31, 2011. In general, the credit is available to
qualifying taxpayers under Articles 22 and 9-A in an amount equal to
20 percent of the qualifying production costs incurred in the actual
filming or recording of a qualified commercial in New York that
exceed the average of the 3
previous years' costs for which the credit Was applied, plus 5 percent
of costs above $500,000 in the calendar year in the Metropolitan
Commuter Transportation District (MCTD) and above $200,000 in the
calendar year outside the MCTD.

This bill would extend the expiration of the tax credit by five years
until December 31, 2016.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget. This bill will decrease tax receipts by $7 million annually
for five years, beginning with SFY 2013-14.

Effective Date:

This bill takes effect immediately.

Part J - Authorize additional credits of $8 million for low-income
housing credit for each of the next five fiscal years.

Purpose:

This bill would increase the aggregate amount of low-income housing
tax credit the Commissioner of Housing and Community Renewal may
allocate from $32 million to $40 million in 2012 and authorizes an
increase in $8 million increments annually for the next four fiscal
years.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History:

Section one of the bill would amend �22 of the Public Housing Law by
increasing the aggregate amount of low-income housing tax credit the
Commissioner may allocate from $32 million to $40 million in 2012.
Section two of the bill would amend �22 of the Public Housing Law by
increasing the aggregate amount of low-income housing tax credit the
Commissioner may allocate from $40 million to $48 million in 2013.
Section three of the bill would amend �22 of the Public Housing Law
by increasing the aggregate amount of low-income housing tax credit
the Commissioner may allocate from $48 million to $56 million in
2014. Section four of the bill would amend �22 of the Public Housing

Law by increasing the aggregate amount of low-income housing tax
credit the Commissioner may allocate from $56 million to $64 million
in 2015. Section five of the bill would amend �22 of the Public
Housing Law by increasing the aggregate amount of low-income housing
tax credit the Commissioner may allocate from $64 million to $72
million in 2016. Current State law provides for total allocation
authority of $32 million.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-2013
Executive Budget. This bill will decrease annual tax receipts by an
estimated $8 million in SFY 2013-2014, $16 million in SFY 2014-2015,
$24 million in SFY 2015-2016, $32 million in SFY 2016-2017, and $40
million in SFY 2017-2018.

Effective Date:

This bill would take effect immediately; provided, however, section
two would take effect on April 1, 2013, section three would take
effect on April 1, 2014, section four would take effect on April
1, 2015 and section five would take effect on April 1, 2016.

Part K - Extend the Biofuel Production Tax Credit through the 2019
taxable year.

Purpose:

This bill would extend the Biofuel Production Tax Credit until
December 31, 2019.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History:

For purpose of the corporate franchise and personal income taxes, a
biofuel production credit is available for taxable years beginning
after 2005 and through 2012. Biofuel producers in New York State are
eligible for a New York State tax credit of $0.15 per gallon of
biodiesel (B100) or ethanol produced after the production facility
has produced and made available for sale 40,000 gallons of biofuel
per year. The maximum credit available is $2.5 million per taxpayer
per taxable year for no more than four consecutive taxable years per
production facility. If the taxpayer is in a partnership or is a
shareholder of a New York-S corporation, the maximum credit amount is
applied at the entity level, so the aggregate credit allowed to all
partners or shareholders may not exceed $2.5 million.

This credit currently applies to taxable years beginning before
January 1, 2013. This bill would extend the tax credit through taxable
years before January 1, 2020.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget. This bill will decrease annual tax receipts by an estimated
$10 million beginning with SFY 2014-2016.

Effective Date:

This bill takes effect immediately.

Part L - Make permanent the Noncustodial Parent Earned Income Tax
Credit.

Purpose:

This bill would make permanent the Noncustodial Parent Earned Income
Tax Credit.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History:

The credit is available to noncustodial parents who pay child support
for a qualifying child with whom they do not reside. This credit
rewards working noncustodial parents who augment their wages, and it
provides a substantial work incentive for those not
working or working only intermittently. The credit is intended to
encourage low-income noncustodial parents to comply with child
support orders. It is also intended to encourage low-income
noncustodial parents to become more involved in the economic and
social well-being of their children.

This credit currently applies to taxable years beginning before
January 1, 2013. This amendment would make the tax credit permanent.

Budget Implications

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget. This bill will decrease annual tax receipts by an estimated
$4 million beginning with SFY 2014-15.

Effective Date

This bill takes effect immediately.

Part M - Prohibit banks from charging fees on levied bank accounts.

Purpose:

This bill would enhance the collection of delinquent taxes and child
support by prohibiting banking institutions from deducting processing
fees from the proceeds of levies executed to collect delinquent taxes
or child support.

Statement in Support, Summary of Provisions, Existing Law and
Prior Legislative History:

Among the fees that many banks charge their depositors is a fee for
processing levies served by execution on the depositors' funds. It is
not uncommon for this fee to be as much as $100. Provided there are
sufficient funds in the account, banks routinely deduct the levy
processing fee from those funds prior to forwarding the remaining
levy proceeds to the executing creditor. In State Fiscal Year (SFY)
2011, there were 73,572 levies served on banking institutions from
which proceeds were remitted to the Department of Taxation and
Finance that did not pay the full levy.

On the federal level, banks cannot deduct processing fees from I.R.S.
levies. The genesis of this policy was a federal court decision that
interpreted the Internal Revenue Code to give IRS levies precedence
over a Bank's unexecuted right to setoff. State Bank of Fraser v.
United States. 861 F. 2d 954. 961 (6th Cir. 1988); IRM 5.17.3.9.4.3
(12-07-2001); IRM 5.11.4.3.3 (9-14-2010).

The Second Circuit and the New York Court of Appeals, applying State
law, have found exactly the opposite, that the Legislature intended
the provisions of Debtor and Creditor
Law �151 that encapsulates the common law right of setoff to override
a creditor's right to levy by execution pursuant to the CPLR. Aurora
Maritime Co., v. Abdullah Mohamed Fahem & Co., 85 F.3d 44,46 (2nd
Cir. 1996); Industrial Commissioner v. Five Corners Tavern, Inc., 47
N.Y.2d 639, 647, 393 N.E2d 1005, 1009, 419 N.Y.S.2d 931, 935-936
(1979). Thus, by operation of Debtor and Creditor law �151, banks are
empowered to set off levy processing fees prior to remitting the levy
proceeds.

This bill would narrowly overrule judicial precedent by stating a new
legislative intent to maximize tax and child support revenues by
prohibiting banking institutions from deducting processing fees from
levy proceeds.

Section one of the bill would amend �5232 of the CPLR by adding a new
subdivision (i) that prohibits banking institutions from setting off
and applying levy processing fees against the proceeds of tax or
child support levies.

Section two would amend �151(d) of the Debtor and Creditor Law to
cross-reference the prohibition on the set off of levy processing
fees against the proceeds of tax or child support levies as provided
for in section one.

This is a new bill.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget because it would generate a revenue gain of $5 million in SFY
13 and $7 million annually thereafter, which is included in the State
Financial Plan.

Effective Date:

This bill takes effect 90 days after it becomes a law.

Part N - Extend the recently enacted lower Metropolitan Commuter
Transportation Mobility Tax Rates for employers to professional
employer organizations.

Purpose:

This bill would extend the recently enacted lower Metropolitan
Commuter Transportation Mobility Tax (MCTMT) rates for employers to
professional employer organizations.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History:

Amendments to the MCTMT enacted as part of the 2011 Extraordinary
Session were an important part of the Governor's initiative to help
small businesses. Professional employer organizations provide a
valuable service to small businesses by allowing them to provide
employee benefits in a cost efficient way. However, because
professional
employer organizations are the employer of record of all employees of
their small business clients, they cannot access the recently enacted
lower MCTMT rates for small businesses. This bill would amend Section
801 of the Tax Law to take these lower rates into account in the tax
calculation for professional employer organizations and make a
technical correction to the tax imposition language applicable to
employers. This bill would also make a technical correction to the
effective date of Part B of Chapter 56 of the Laws of 2011 to clarify
that the lower MCTMT rate for self-employed individuals on their
earnings attributable to the Metropolitan Commuter Transportation
District applies to taxable years beginning on or after January 1,
2012.

Budget Implications:

Enactment of this bill is necessary to implement recently enacted
MCTMT cuts as intended by the Legislature. There is no fiscal impact
since the bill would only affect employers already included in the
original revenue estimate.

Effective Date:

This bill takes effect immediately; provided however that the
amendment in Section 1 01 this bill concerning professional employer
organizations take effect for the quarter beginning on April 1, 2012.

Part 0 - Extend for one year lower Pari-Mutuel tax rates and rules
governing simulcasting of out-of-state races.

Purpose:

This bill would extend for a period of one year various provisions of
the Racing, PariMutuel Wagering and Breeding (Racing) Law which
expire during the 2011-12 fiscal year.

Statement in Support, Summary of Provisions, Existing Law, and
Prior Legislative History:

Section 1 would amend Racing Law � 1003(a) to extend in-home
simulcasting from June 30, 2012 to June 30, 2013.

Section 2 would amend Racing Law �107(3)(d) to extend the current
percentage of total pools allocated to purses that a track located in
Westchester County receives from a franchised corporation from June
30, 2012 to June 30, 2013.

Section 3 would amend the opening paragraph of Racing Law � 1014(1)
to continue the provisions allowing simulcasting of out-of-state
thoroughbred races on any day the Saratoga thoroughbred track is
operating and to delay these provisions from governing the
simulcasting of out-of-state thoroughbred races on all days whether
or not the Saratoga thoroughbred track is operating from June 30,
2012 to June 30, 2013.

Section 4 would amend Racing Law � 1015(1) to extend the provisions
governing the simulcasting of races conducted at out-of-state harness
tracks from June 30, 2012 to June 30, 2013.

Section 5 would amend the opening paragraph of Racing Law �1016(1) to
extend the provisions governing the simulcasting of out-of-state
thoroughbred races on any day the Saratoga thoroughbred track is
closed from June 30, 2012 to June 30, 2013.

Section 6 would amend the opening paragraph of section 1018 of the
Racing, PariMutuel Wagering and Breeding Law to extend the current
distribution of revenue from out-of-state simulcasting during the
Saratoga meet through September 8, 2012.

Section 7 would amend � 32 of chapter 281 of the Laws of 1994 to
extend the current amount of off-track betting wagers on New York
Racing Association, Inc. (NYRA) pools dedicated to purse enhancement
from June 30, 2012 to June 30, 2013.

Section 8 would amend � 54 of chapter 346 of the Laws of 1990 to
extend binding arbitration for disagreements from June 30, 2012 to
June 30, 2013.

Sections 9 and 10 would amend Racing Law � 238(1)(a) to extend the
current distribution of revenue from on-track wagering on NYRA races.

Section 11 would amend Racing Law � 1012(5) to extend the
authorization for account wagering from June 30, 2012 to June 30, 2013.

The extension of these provisions would maintain the pari-mutuel
betting and simulcasting structure that is currently in place in New
York State. The provisions extended by sections one through six of
this bill were first enacted in 1994 and section seven was enacted in
1990. These provisions were most recently extended in 2011.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget because it maintains the current pari-mutuel betting structure in
New York State.

Effective Date:

This bill takes effect immediately.

Part P - Redistribute the statewide collected transmission tax between
the upstate (PTOA) and downstate (MMTOA) transit accounts in an
equitable manner, replacing the existing yearly transfer between the
two accounts.

Purpose:

This bill would redistribute the revenue collected from the corporate
and utilities taxes imposed under Tax Law sections 183 and 184 to
provide an equitable share to the public transportation systems
operating assistance account, and replace the yearly transfer that
has occurred from the Metropolitan Mass Transportation Operating
Assistance Account (MMTOA) to the Public Transportation Operating
Assistance (PTOA) account.

Statement in Support, Summary of Provisions, Existing Law and
Prior Legislative History:

This bill would amend subdivision 3 of section 205 of Tax Law to
provide that, on and after April 1, 2012, after reserving amounts for
refunds and reimbursements, twenty percent of the moneys collected
from the taxes imposed by sections 183 and 184 of Tax Law shall be
deposited to the credit of the Dedicated Highway and Bridge Trust
Fund created by State Finance Law section 89-b, fifty-four percent
shall be deposited in the Mass Transportation Operating Assistance
Fund to the credit of the MMTOA account and twenty-six percent shall

be deposited in the Mass Transportation Operating Assistance Fund to
the credit of the PTOA account, both created by State Finance Law
section 88-a.

This bill would not increase the tax rate. It only redistributes the
amount currently deposited in the Mass Transportation Operating
Assistance Fund between the two accounts within the fund, in
accordance to a regional split. Since the taxes are collected
statewide, the new distribution is based upon population within the
downstate and upstate service districts.

Budget Implications:

Enactment of this bill is necessary to implement the 2012-13 Executive
Budget because it replaces the annual transfer that had occurred
between MMTOA to PTOA. Without this tax redistribution, the PTOA
account would not receive revenues for operating aid to upstate
transit systems.

Effective Date:

This bill takes effect April 1, 2012.

The provisions of this act shall take effect immediately, provided,
however, that the applicable effective date of each part of this act
shall be as specifically set forth in the last section of such part.

S6259B-2011 Text

 S T A T E   O F   N E W   Y O R K
 
 S. 6259--B                                            A. 9059--B
 SENATE - ASSEMBLY
 January 17, 2012
 
 IN  SENATE -- A BUDGET BILL, submitted by the Governor pursuant to arti
 cle seven of the Constitution -- read twice and ordered  printed,  and
 when  printed to be committed to the Committee on Finance -- committee
 discharged, bill amended, ordered reprinted as amended and recommitted
 to said committee  --  committee  discharged,  bill  amended,  ordered
 reprinted as amended and recommitted to said committee
 IN  ASSEMBLY  --  A  BUDGET  BILL, submitted by the Governor pursuant to
 article seven of the Constitution -- read once  and  referred  to  the
 Committee  on  Ways  and  Means -- committee discharged, bill amended,
 ordered reprinted as amended and  recommitted  to  said  committee  -
 again  reported from said committee with amendments, ordered reprinted
 as amended and recommitted to said committee
 

AN ACT to amend chapter 540 of the laws of 1992, amending the real prop
 erty tax law relating to oil and  gas  charges,  in  relation  to  the
 effective  date  of  such chapter (Part A); to amend the real property
 tax law, the tax law, the administrative code of the city of New  York
 and  the  state  finance  law,  in  relation to the suspension of STAR
 exemptions and related benefits of persons who are delinquent  in  the
 payment  of  outstanding  state tax liabilities (Part B); to amend the
 tax law, in relation to reforming  excise  tax  on  tobacco  products,
 imposing  a  fixed rate of tax on loose tobacco, and imposing a retail
 tax on cigars (Part C); to amend chapter 109  of  the  laws  of  2006,
 amending  the tax law relating to providing exemptions, reimbursements
 and credits from various  taxes  for  certain  alternative  fuels,  in
 relation  to  extending the alternative fuels tax exemptions (Part D);
 to amend the tax law, in relation to making  technical  amendments  to
 the  tax  treatment  of diesel fuel to reflect industry practice (Part
 E); to amend the tax law, in relation to the power of the commissioner
 of taxation and finance to refuse to issue a certificate of  authority
 to  collect the sales and compensating use taxes imposed by article 28
 of the tax law and pursuant to the authority of article 29 of the  tax
 law  (Part  F);  to  amend the tax law and part U of chapter 61 of the
 laws of 2011, amending the real property tax law, the general  munici
 pal  law, the public officers law, the tax law, the abandoned property
 law, the state finance law and the administrative code of the city  of
 New York, relating to establishing standards for electronic real prop
 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD12674-03-2
 
       S. 6259--B                          2                         A. 9059--B
 erty  tax  administration,  allowing  the  department  of taxation and
 finance to use electronic communication means to furnish  tax  notices
 and  other  documents,  mandatory  electronic filing of tax documents,
 debit cards issued for tax refunds, improving sales tax compliance and
 repealing  certain  provisions  of  the tax law and the administrative
 code of the city of New York relating thereto, in relation  to  making
 permanent,  provisions  relating to mandatory electronic filing of tax
 documents and improving sales tax compliance; and  to  repeal  certain
 provisions  of  the tax law and the administrative code of the city of
 New York relating thereto (Part G); to amend the tax law, in  relation
 to  the personal income tax credits for solar energy systems equipment
 and the sales and use tax exemption provided for such equipment  (Part
 H);  to  amend  the tax law, in relation to extending the empire state
 commercial production tax credit; and to amend part V of chapter 62 of
 the laws of 2006 relating to the empire  state  commercial  production
 tax  credit,  in  relation  to  the effectiveness thereof (Part I); to
 amend the public housing law, in relation to the credit against income
 tax for persons or entities investing in low-income housing (Part  J);
 to  amend the tax law, in relation to extending the biofuel production
 tax credit; and to amend part X of chapter 62 of  the  laws  of  2006,
 amending  the  tax  law  relating to providing tax credits for biofuel
 production plants, in relation to the effectiveness thereof (Part  K);
 to  amend  chapter  58  of  the laws of 2006, relating to providing an
 enhanced earned income tax credit, in relation  to  the  effectiveness
 thereof  (Part  L);  to amend the civil practice law and rules and the
 debtor and creditor law, in relation  to  prohibiting  banking  insti
 tutions from deducting levy processing fees from tax and child support
 levy proceeds (Part M); to amend the tax law, in relation to tax rates
 and exclusions under the metropolitan commuter transportation mobility
 tax  for  professional  employer  organizations and to amend part B of
 chapter 56 of the laws of 2011 amending the tax law  relating  to  the
 tax  rates  and exclusions under the metropolitan commuter transporta
 tion mobility tax, in relation to the effectiveness thereof (Part  N);
 to  amend  the  racing,  pari-mutuel  wagering  and  breeding  law, in
 relation to licenses for simulcast facilities, sums relating to  track
 simulcast,  simulcast of out-of-state thoroughbred races, simulcasting
 of races run by  out-of-state  harness  tracks  and  distributions  of
 wagers;  to amend chapter 281 of the laws of 1994 amending the racing,
 pari-mutuel wagering and breeding  law  and  other  laws  relating  to
 simulcasting  and chapter 346 of the laws of 1990 amending the racing,
 pari-mutuel wagering and breeding  law  and  other  laws  relating  to
 simulcasting  and  the  imposition  of  certain  taxes, in relation to
 extending certain provisions thereof; to amend the racing, pari-mutuel
 wagering and breeding law, in relation to extending certain provisions
 thereof (Part O); to amend the tax law, in relation  to  the  distrib
 ution  of  revenue  collected  from  the corporate and utilities taxes
 imposed under sections 183 and 184 of the tax law  (Part  P);  and  to
 amend the tax law and the administrative code of the city of New York,
 in  relation  to  facilitating the compliance of room remarketers with
 their obligation to collect sales tax  on  their  sales  of  occupancy
 (Part Q)
 

THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM
 BLY, DO ENACT AS FOLLOWS:

 
       S. 6259--B                          3                         A. 9059--B
 

Section 1. This act enacts into law major  components  of  legislation
 which are necessary to implement the state fiscal plan for the 2012-2013
 state  fiscal  year.  Each  component  is wholly contained within a Part
 identified as Parts A through Q. The effective date for each  particular
 provision contained within such Part is set forth in the last section of
 such Part. Any provision in any section contained within a Part, includ
 ing the effective date of the Part, which makes a reference to a section
 "of  this  act", when used in connection with that particular component,
 shall be deemed to mean and refer to the corresponding  section  of  the
 Part  in  which  it  is  found.

Section three of this act sets forth the
 general effective date of this act.
 PART A
 

Section 1.

Section 2 of chapter 540 of the laws of 1992, amending  the
 real  property  tax  law  relating to oil and gas charges, as amended by
 section 1 of part II of chapter 56 of the laws of 2009,  is  amended  to
 read as follows:

 

S  2.  This  act  shall take effect immediately and shall be deemed to
 have been in full force and effect on and after April 1, 1992; provided,
 however that any charges imposed by section 593 of the real property tax
 law as added by section one of this act shall first be  due  for  values
 for assessment rolls with tentative completion dates after July 1, 1992,
 and  provided  further,  that  this  act  shall remain in full force and
 effect until March 31, [2012] 2015, at which time  section  593  of  the
 real  property  tax  law  as  added  by section one of this act shall be
 repealed.
 

S 2. This act shall take effect immediately and  shall  be  deemed  to
 have been in full force and effect on and after April 1, 2012.
 PART B
 

Section  1.  Subdivision 3 of section 425 of the real property tax law
 is amended by adding a new paragraph (f) to read as follows:

 (F) COMPLIANCE WITH STATE TAX OBLIGATIONS. THE PROPERTY'S  ELIGIBILITY
 FOR  THE  STAR  EXEMPTION  MUST NOT BE SUSPENDED PURSUANT TO SECTION ONE
 HUNDRED SEVENTY-ONE-Y OF THE TAX LAW  DUE  TO  THE  PAST-DUE  STATE  TAX
 LIABILITIES  OF ONE OR MORE OF ITS OWNERS. NOTWITHSTANDING ANY PROVISION
 OF LAW TO THE CONTRARY,  WHERE  A  PROPERTY'S  ELIGIBILITY  FOR  A  STAR
 EXEMPTION  HAS  BEEN  SUSPENDED  PURSUANT TO SUCH SECTION, THE FOLLOWING
 PROVISIONS SHALL BE APPLICABLE:

 (I) THE PROPERTY SHALL BE INELIGIBLE FOR  A  BASIC  OR  ENHANCED  STAR
 EXEMPTION EFFECTIVE WITH THE NEXT SCHOOL YEAR COMMENCING AFTER THE ISSU
 ANCE  OF  NOTICE  BY THE DEPARTMENT OF THE SUSPENSION OF ITS ELIGIBILITY
 FOR THE STAR EXEMPTION, EVEN IF THE NOTICE WAS ISSUED AFTER THE APPLICA
 BLE TAXABLE STATUS DATE. IF A STAR EXEMPTION HAS BEEN GRANTED TO SUCH  A
 PROPERTY  ON A TENTATIVE OR FINAL ASSESSMENT ROLL, THE ASSESSOR OR OTHER
 PERSON HAVING CUSTODY OF THAT ROLL IS HEREBY AUTHORIZED AND DIRECTED  TO
 IMMEDIATELY REMOVE THAT STAR EXEMPTION FROM THE ROLL.
 (II) ANY CHALLENGE TO THE FACTUAL OR LEGAL BASIS BEHIND THE SUSPENSION
 OF A PROPERTY'S ELIGIBILITY FOR A STAR EXEMPTION PURSUANT TO SECTION ONE
 HUNDRED SEVENTY-ONE-Y OF THE TAX LAW MUST BE PRESENTED TO THE DEPARTMENT
 IN  THE  MANNER  PRESCRIBED  BY  SUCH SECTION. NEITHER AN ASSESSOR NOR A
 BOARD OF ASSESSMENT REVIEW HAS THE AUTHORITY TO CONSIDER  SUCH  A  CHAL
 LENGE.
 
       S. 6259--B                          4                         A. 9059--B
 (III)  THE  PROPERTY  SHALL  REMAIN  INELIGIBLE FOR THE STAR EXEMPTION
 UNTIL THE DEPARTMENT NOTIFIES THE ASSESSOR THAT THE  SUSPENSION  OF  ITS
 ELIGIBILITY HAS BEEN LIFTED. ONCE THE ASSESSOR HAS BEEN SO NOTIFIED, THE
 EXEMPTION  MAY BE RESUMED ON A PROSPECTIVE BASIS ONLY, PROVIDED THAT THE
 ELIGIBILITY REQUIREMENTS OF THIS SECTION ARE OTHERWISE SATISFIED.
 (IV) IN THE CASE OF A COOPERATIVE APARTMENT OR MOBILE HOME RECEIVING A
 STAR  EXEMPTION  PURSUANT  TO PARAGRAPH (K) OR (L) OF SUBDIVISION TWO OF
 THIS SECTION, A SUSPENSION OF A  STAR  EXEMPTION  DUE  TO  A  TAXPAYER'S
 PAST-DUE STATE TAX LIABILITIES SHALL ONLY APPLY TO THE STAR EXEMPTION ON
 THE  COOPERATIVE  APARTMENT OR MOBILE HOME OWNED, OR DEEMED TO BE OWNED,
 BY THAT TAXPAYER.
 

S 2. The tax law is amended by adding a new section 171-y to  read  as
 follows:

 

S  171-Y.  ENFORCEMENT OF DELINQUENT STATE TAX LIABILITIES THROUGH THE
 SUSPENSION OF ELIGIBILITY FOR STAR EXEMPTIONS. 1.  THE  COMMISSIONER  IS
 HEREBY  AUTHORIZED  TO DEVELOP A PROGRAM TO COLLECT DELINQUENT STATE TAX
 LIABILITIES FROM TAXPAYERS THROUGH THE SUSPENSION OF THE ELIGIBILITY  OF
 PROPERTIES  FOR STAR EXEMPTIONS WHERE ONE OR MORE OF THE PROPERTY OWNERS
 HAVE PAST-DUE STATE TAX LIABILITIES. FOR THE PURPOSES OF  THIS  SECTION,
 THE  TERM "STATE TAX LIABILITY" MEANS ANY TAX (INCLUDING BUT NOT LIMITED
 TO LOCAL SALES AND INCOME TAXES), SURCHARGE, PENALTY, INTEREST CHARGE OR
 FEE ADMINISTERED BY THE COMMISSIONER THAT IS OWED  BY  A  TAXPAYER;  THE
 TERM  "PAST-DUE  STATE TAX LIABILITIES" MEANS ANY STATE TAX LIABILITY OR
 LIABILITIES WHICH HAVE BECOME FIXED AND FINAL SUCH THAT THE TAXPAYER  NO
 LONGER  HAS ANY RIGHT TO ADMINISTRATIVE OR JUDICIAL REVIEW AND FOR WHICH
 THE TAXPAYER HAS NOT MADE PAYMENT ARRANGEMENTS FOR THAT LIABILITY SATIS
 FACTORY TO THE COMMISSIONER; THE TERM "TAXPAYER" SHALL MEAN THE INDIVID
 UAL RESPONSIBLE FOR THE PAYMENT OF ANY OF THE PAST-DUE STATE TAX LIABIL
 ITIES; AND THE TERM "STAR  EXEMPTION"  MEANS  THE  EXEMPTION  FROM  REAL
 PROPERTY  TAXATION AUTHORIZED BY SECTION FOUR HUNDRED TWENTY-FIVE OF THE
 REAL PROPERTY TAX LAW.
 2. THE COMMISSIONER SHALL ESTABLISH PROCEDURES FOR THE  ADMINISTRATION
 OF THIS PROGRAM, WHICH SHALL INCLUDE THE FOLLOWING PROVISIONS:

 (A)  THE  CRITERIA  FOR  IDENTIFYING TAXPAYERS WITH PAST-DUE STATE TAX
 LIABILITIES.
 (B) THE PROCEDURES BY WHICH THE  DEPARTMENT  SHALL  DETERMINE  WHETHER
 PROPERTIES OWNED BY SUCH TAXPAYERS ARE RECEIVING THE STAR EXEMPTION.
 (C) THE PROCEDURES BY WHICH THE DEPARTMENT SHALL NOTIFY SUCH TAXPAYERS
 THAT  THE ELIGIBILITY OF THEIR PROPERTIES FOR THE STAR EXEMPTION WILL BE
 SUSPENDED UNLESS THEY EITHER SATISFY THEIR PAST-DUE  STATE  TAX  LIABIL
 ITIES OR MAKE PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER BY A
 DATE TO BE SPECIFIED IN THE NOTICE.
 (D)  THE  PROCEDURES BY WHICH THE DEPARTMENT SHALL NOTIFY ASSESSORS OF
 PROPERTIES WHOSE ELIGIBILITY FOR STAR EXEMPTIONS HAS BEEN SUSPENDED  DUE
 TO THE PAST-DUE STATE TAX LIABILITIES OF ONE OR MORE PROPERTY OWNERS.
 (E) THE PROCEDURES BY WHICH TAXPAYERS MAY ACT TO LIFT SUCH SUSPENSIONS
 ON  A  PROSPECTIVE  BASIS  BY EITHER SATISFYING THEIR PAST-DUE STATE TAX
 LIABILITIES OR MAKING PAYMENT ARRANGEMENTS SATISFACTORY TO  THE  COMMIS
 SIONER.
 (F) THE PROCEDURES BY WHICH THE DEPARTMENT SHALL NOTIFY ASSESSORS WHEN
 THE  SUSPENSION  OF  A PROPERTY'S ELIGIBILITY FOR THE STAR EXEMPTION HAS
 BEEN LIFTED.
 (G) THE PROCEDURES BY WHICH THE DEPARTMENT AND ASSESSORS SHALL COORDI
 NATE AND EXECUTE THEIR OBLIGATIONS PURSUANT TO THIS  SECTION  AND  PARA
 GRAPH  (F)  OF  SUBDIVISION THREE OF SECTION FOUR HUNDRED TWENTY-FIVE OF
 THE REAL PROPERTY TAX LAW.
 
       S. 6259--B                          5                         A. 9059--B
 (H) ANY OTHER MATTER AS THE DEPARTMENT SHALL DEEM NECESSARY  TO  CARRY
 OUT THE PROVISIONS OF THIS SECTION.
 3.  THE  DEPARTMENT SHALL NOTIFY THE TAXPAYER AT LEAST FORTY-FIVE DAYS
 PRIOR TO THE DATE THE DEPARTMENT INTENDS TO INFORM THE ASSESSOR  OF  THE
 SUSPENSION  OF  THE ELIGIBILITY FOR THE STAR EXEMPTION OF PROPERTY WHICH
 IS WHOLLY OR PARTIALLY OWNED BY THE TAXPAYER.
 (A) SUCH NOTICE SHALL INCLUDE A STATEMENT  THAT  THE  DEPARTMENT  WILL
 NOTIFY  THE  ASSESSOR  OF THE SUSPENSION OF THE ELIGIBILITY FOR THE STAR
 EXEMPTION OF PROPERTY WHOLLY OR PARTIALLY OWNED BY THE  TAXPAYER  UNLESS
 THE  TAXPAYER  FULLY  SATISFIES THE OUTSTANDING STATE TAX LIABILITIES OR
 OTHERWISE MAKES PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER IN
 ACCORDANCE WITH LAW. HOWEVER, IN ANY CASE  WHERE  A  TAXPAYER  FAILS  TO
 COMPLY  WITH  THE TERMS OF AN INSTALLMENT PAYMENT AGREEMENT AS DESCRIBED
 HEREIN MORE THAN ONCE WITHIN A TWELVE MONTH PERIOD, THE COMMISSIONER MAY
 IMMEDIATELY NOTIFY THE ASSESSOR OF  THE  SUSPENSION  OF  THE  PROPERTY'S
 ELIGIBILITY FOR THE STAR EXEMPTION.
 (B)  SUCH  NOTICE SHALL ALSO INCLUDE THE INFORMATION NECESSARY FOR THE
 TAXPAYER TO PAY THE PAST-DUE LIABILITY,  MAKE  PAYMENT  ARRANGEMENTS  OR
 OTHERWISE REQUEST ADDITIONAL INFORMATION.
 (C)  SUCH NOTICE SHALL ALSO STATE THAT THE TAXPAYER'S RIGHT TO PROTEST
 THE NOTICE IS LIMITED TO RAISING ISSUES THAT  CONSTITUTE  A  MISTAKE  OF
 FACT AS DEFINED IN SUBDIVISION FIVE OF THIS SECTION.
 (D)  SUCH NOTICE SHALL ALSO INCLUDE A STATEMENT THAT THE SUSPENSION OF
 THE PROPERTY'S STAR EXEMPTION  WILL  CONTINUE  UNTIL  THE  TAXPAYER  HAS
 SATISFIED  HIS OR HER PAST-DUE STATE TAX LIABILITIES OR HAS MADE PAYMENT
 ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER,  AND  THAT  THE  PROPERTY
 WILL  BE  PERMANENTLY  INELIGIBLE  FOR THE STAR EXEMPTION FOR ANY SCHOOL
 YEARS THAT COMMENCE WHILE ITS ELIGIBILITY  FOR  THE  STAR  EXEMPTION  IS
 SUSPENDED.
 (E)  SUCH  NOTICE  MAY  ALSO  INCLUDE  ANY  OTHER INFORMATION THAT THE
 COMMISSIONER DEEMS NECESSARY.
 4. IF THE TAXPAYER FAILS TO SATISFY HIS  OR  HER  PAST-DUE  STATE  TAX
 LIABILITIES OR MAKE SATISFACTORY PAYMENT ARRANGEMENTS BY THE DATE SPECI
 FIED  IN  THE  NOTICE,  THE  DEPARTMENT SHALL NOTIFY THE ASSESSOR OF THE
 SUSPENSION OF THE PROPERTY'S ELIGIBILITY FOR THE STAR EXEMPTION.
 5. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, THE  NOTICE  ISSUED  BY
 THE  DEPARTMENT  PURSUANT  TO THIS SECTION FOR THE PURPOSE OF SUSPENDING
 THE PROPERTY'S ELIGIBILITY FOR THE STAR EXEMPTION MAY ONLY BE CHALLENGED
 BEFORE THE DEPARTMENT ON THE GROUNDS OF A MISTAKE OF FACT AS DEFINED  IN
 THIS SUBDIVISION AND THE TAXPAYER WILL HAVE NO RIGHT TO COMMENCE A COURT
 ACTION,  ADMINISTRATIVE  PROCEEDING  OR ANY OTHER FORM OF LEGAL RECOURSE
 AGAINST THE DEPARTMENT OR ASSESSOR REGARDING SUCH  SUSPENSION.  FOR  THE
 PURPOSES  OF  THIS  SUBDIVISION,  "MISTAKE OF FACT" IS LIMITED TO CLAIMS
 THAT: (I) THE INDIVIDUAL NOTIFIED IS NOT THE TAXPAYER AT ISSUE; (II) THE
 PAST-DUE STATE TAX LIABILITIES WERE SATISFIED; OR (III)  THE  DEPARTMENT
 INCORRECTLY  FOUND THAT THE TAXPAYER HAS FAILED TO COMPLY WITH THE TERMS
 OF AN INSTALLMENT PAYMENT AGREEMENT MORE THAN ONCE WITHIN A TWELVE MONTH
 PERIOD FOR THE PURPOSES OF SUBDIVISION THREE OF THIS SECTION.   HOWEVER,
 NOTHING IN THIS SUBDIVISION IS INTENDED TO LIMIT A TAXPAYER FROM SEEKING
 RELIEF  FROM JOINT AND SEVERAL LIABILITY PURSUANT TO SECTION SIX HUNDRED
 FIFTY-FOUR OF THIS CHAPTER TO THE EXTENT THAT  HE  OR  SHE  IS  ELIGIBLE
 PURSUANT  TO THAT SUBDIVISION OR ESTABLISHING TO THE DEPARTMENT THAT THE
 ENFORCEMENT OF THE UNDERLYING TAX LIABILITIES HAS  BEEN  STAYED  BY  THE
 FILING  OF  A  PETITION  PURSUANT  TO THE BANKRUPTCY CODE OF 1978 (TITLE
 ELEVEN OF THE UNITED STATES CODE).
 
       S. 6259--B                          6                         A. 9059--B
 6. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY,  THE  DEPART
 MENT SHALL FURNISH THE APPROPRIATE ASSESSOR WITH THE NAME AND ADDRESS OF
 ANY  TAXPAYER WHO OWNS PROPERTY WHICH HAS BECOME INELIGIBLE FOR THE STAR
 EXEMPTION PURSUANT TO THIS SECTION  AND  PARAGRAPH  (F)  OF  SUBDIVISION
 THREE  OF  SECTION FOUR HUNDRED TWENTY-FIVE OF THE REAL PROPERTY TAX LAW
 AND A DESCRIPTION OF SUCH PROPERTY.
 7. ACTIVITIES TO COLLECT  STATE  TAX  LIABILITIES  UNDERTAKEN  BY  THE
 DEPARTMENT PURSUANT TO THIS SECTION SHALL NOT IN ANY WAY LIMIT, RESTRICT
 OR  IMPAIR THE DEPARTMENT FROM EXERCISING ANY OTHER AUTHORITY TO COLLECT
 OR ENFORCE PAST-DUE STATE TAX LIABILITIES  UNDER  ANY  OTHER  APPLICABLE
 PROVISION  OF LAW. THE AMOUNT BY WHICH A TAXPAYER'S PROPERTY TAX LIABIL
 ITY INCREASES AS A RESULT OF THE LOSS OF THE STAR EXEMPTION PURSUANT  TO
 PARAGRAPH  (F)  OF SUBDIVISION THREE OF SECTION FOUR HUNDRED TWENTY-FIVE
 OF THE REAL PROPERTY TAX LAW AND THIS SECTION MAY NOT BE APPLIED IN  ANY
 WAY AS AN OFFSET AGAINST THE AMOUNT OF THE TAXPAYER'S PAST-DUE STATE TAX
 LIABILITY.
 

S 3. Subsection (e) of section 697 of the tax law is amended by adding
 a new paragraph 3-b to read as follows:

 (3-B)   NOTWITHSTANDING  THE  PROVISIONS  OF  PARAGRAPH  ONE  OF  THIS
 SUBSECTION, THE COMMISSIONER MAY DISCLOSE TO ASSESSORS  THE  INFORMATION
 DESCRIBED  IN  SECTION ONE HUNDRED SEVENTY-ONE-Y OF THIS CHAPTER THAT IS
 NECESSARY IN THE COMMISSIONER'S DISCRETION FOR THE PROPER IDENTIFICATION
 OF A TAXPAYER WITH PAST-DUE STATE TAX LIABILITIES WHO OWNS PROPERTY WITH
 A STAR EXEMPTION THAT IS SUBJECT TO SUSPENSION PURSUANT TO SUCH  SECTION
 AND   PARAGRAPH  (F)  OF  SUBDIVISION  THREE  OF  SECTION  FOUR  HUNDRED
 TWENTY-FIVE OF THE REAL PROPERTY TAX LAW.
 

S 4. The tax law is amended by adding a new section 1304-E to read  as
 follows:

 

S  1304-E. RECALCULATION OF TAX RATE FOR TAXPAYERS WITH PAST-DUE STATE
 TAX LIABILITIES. WHEN A TAXPAYER OWES A PAST-DUE STATE TAX LIABILITY, AS
 THAT TERM IS DEFINED IN SECTION ONE HUNDRED SEVENTY-ONE-Y OF THIS  CHAP
 TER,  ON  THE  LAST  DAY OF THE TAXABLE YEAR, THE TAX RATE APPLICABLE TO
 SUCH TAXPAYER UNDER SECTION THIRTEEN HUNDRED FOUR OF  THIS  ARTICLE  FOR
 THE  TAXABLE  YEAR  SHALL  BE  RECALCULATED BY THE COMMISSIONER SO AS TO
 ELIMINATE THE REDUCTION TO SUCH TAX RATE MADE BY CHAPTER  THREE  HUNDRED
 EIGHTY-NINE  OF  THE LAWS OF NINETEEN HUNDRED NINETY-SEVEN, AS ADJUSTED.
 SUCH RECALCULATION SHALL BE TREATED AS  A  MATHEMATICAL  ERROR  AND  THE
 COMMISSIONER  MAY  ISSUE  A  NOTICE  AND  DEMAND TO THE TAXPAYER FOR THE
 AMOUNT DUE AS A RESULT OF SUCH RECALCULATION.  THE  AMOUNT  BY  WHICH  A
 TAXPAYER'S  INCOME  TAX  LIABILITY INCREASES AS A RESULT OF THE RECALCU
 LATION OF THE APPLICABLE TAX RATE PURSUANT TO THIS SECTION  MAY  NOT  BE
 APPLIED  IN  ANY  WAY  AS AN OFFSET AGAINST THE AMOUNT OF THE TAXPAYER'S
 PAST-DUE STATE TAX LIABILITY.
 

S 5. Paragraph 1 of subsection (e) of section 1310 of the tax law,  as
 amended  by  section  3  of part A of chapter 56 of the laws of 1998, is
 amended to read as follows:

 (1) For taxable years beginning after nineteen hundred ninety-seven, a
 state school tax reduction credit shall be allowed as  provided  in  the
 following  tables. The credit shall be allowed against the taxes author
 ized by this article reduced by the credits permitted by  this  article.
 If  the  credit exceeds the tax as so reduced, the taxpayer may receive,
 and the comptroller, subject to a certificate of the commissioner, shall
 pay as an overpayment, without interest, the amount of such excess.  For
 purposes  of this subsection, no credit shall be granted to (A) an indi
 vidual with respect to whom a deduction under subsection (c) of  section
 one  hundred  fifty-one  of  the  internal  revenue code is allowable to
 
       S. 6259--B                          7                         A. 9059--B
 another taxpayer for the taxable year, OR (B)  A  TAXPAYER  WHO  OWES  A
 PAST-DUE  STATE  TAX  LIABILITY,  AS THAT TERM IS DEFINED IN SECTION ONE
 HUNDRED SEVENTY-ONE-Y OF THIS CHAPTER, ON THE LAST DAY  OF  THE  TAXABLE
 YEAR.  IF  A  TAXPAYER  WITH  A PAST-DUE STATE TAX LIABILITY CLAIMS THIS
 CREDIT, ANY AMOUNT OWED AS A RESULT OF THE DENIAL OF THIS  CREDIT  SHALL
 BE  TREATED  AS  A  MATHEMATICAL  ERROR AND THE COMMISSIONER MAY ISSUE A
 NOTICE AND DEMAND TO THE TAXPAYER FOR SUCH AMOUNT. THE AMOUNT BY WHICH A
 TAXPAYER'S INCOME TAX LIABILITY INCREASES AS A RESULT OF THE LOSS OF THE
 TAX CREDIT PURSUANT TO THIS SECTION MAY NOT BE APPLIED IN ANY WAY AS  AN
 OFFSET   AGAINST  THE  AMOUNT  OF  THE  TAXPAYER'S  PAST-DUE  STATE  TAX
 LIABILITY.
 

S 6. The administrative code of the city of New  York  is  amended  by
 adding a new section 11-1704.2 to read as follows:

 

S  11-1704.2  RECALCULATION  OF  TAX  RATE FOR TAXPAYERS WITH PAST-DUE
 STATE TAX LIABILITIES. WHEN A TAXPAYER OWES A PAST-DUE STATE TAX LIABIL
 ITY, AS THAT TERM IS DEFINED IN SECTION ONE HUNDRED SEVENTY-ONE-Y OF THE
 TAX LAW, ON THE LAST DAY OF THE TAXABLE YEAR, THE TAX RATE APPLICABLE TO
 SUCH TAXPAYER UNDER SECTION 11-1701 OF THIS SUBCHAPTER FOR  THE  TAXABLE
 YEAR  SHALL  BE RECALCULATED BY THE COMMISSIONER OF TAXATION AND FINANCE
 SO AS TO ELIMINATE THE REDUCTION TO SUCH TAX RATE MADE BY CHAPTER  THREE
 HUNDRED  EIGHTY-NINE  OF  THE  LAWS OF NINETEEN HUNDRED NINETY-SEVEN, AS
 ADJUSTED.  SUCH RECALCULATION SHALL BE TREATED AS A  MATHEMATICAL  ERROR
 AND  THE  COMMISSIONER  OF  TAXATION  AND FINANCE MAY ISSUE A NOTICE AND
 DEMAND TO THE TAXPAYER FOR THE AMOUNT DUE AS A RESULT OF  SUCH  RECALCU
 LATION.  THE AMOUNT BY WHICH A TAXPAYER'S INCOME TAX LIABILITY INCREASES
 AS  A RESULT OF THE RECALCULATION OF THE APPLICABLE TAX RATE PURSUANT TO
 THIS SECTION MAY NOT BE APPLIED IN ANY WAY  AS  AN  OFFSET  AGAINST  THE
 AMOUNT OF THE TAXPAYER'S PAST-DUE STATE TAX LIABILITY.
 

S 7. Paragraph 1 of subdivision (c) of section 11-1706 of the adminis
 trative  code of the city of New York, as amended by section 6 of part A
 of chapter 56 of the laws of 1998, is amended to read as follows:

 (1) For taxable years beginning after nineteen hundred ninety-seven, a
 state school tax reduction credit shall be allowed as  provided  in  the
 following  tables. The credit shall be allowed against the taxes author
 ized by this article reduced by the credits permitted by  this  article.
 If  the  credit exceeds the tax as so reduced, the taxpayer may receive,
 and the comptroller, subject to a certificate of the commissioner, shall
 pay as an overpayment, without interest, the amount of such excess.  For
 purposes of this subdivision, no credit shall be granted to (A) an indi
 vidual  with respect to whom a deduction under subsection (c) of section
 one hundred fifty-one of the  internal  revenue  code  is  allowable  to
 another  taxpayer  for  the  taxable  year, OR (B) A TAXPAYER WHO OWES A
 PAST-DUE STATE TAX LIABILITY, AS THAT TERM IS  DEFINED  IN  SECTION  ONE
 HUNDRED  SEVENTY-ONE-Y  OF  THE  TAX LAW, ON THE LAST DAY OF THE TAXABLE
 YEAR.  IF A TAXPAYER WITH A PAST-DUE STATE  TAX  LIABILITY  CLAIMS  THIS
 CREDIT,  ANY  AMOUNT OWED AS A RESULT OF THE DENIAL OF THIS CREDIT SHALL
 BE TREATED AS A MATHEMATICAL ERROR AND THE COMMISSIONER OF TAXATION  AND
 FINANCE  MAY  ISSUE A NOTICE AND DEMAND TO THE TAXPAYER FOR SUCH AMOUNT.
 THE AMOUNT BY WHICH A TAXPAYER'S INCOME TAX  LIABILITY  INCREASES  AS  A
 RESULT OF THE LOSS OF THE TAX CREDIT PURSUANT TO THIS SECTION MAY NOT BE
 APPLIED  IN  ANY  WAY  AS AN OFFSET AGAINST THE AMOUNT OF THE TAXPAYER'S
 PAST-DUE STATE TAX LIABILITY.
 

S 8. Paragraph (a) of subdivision 3  of  section  54-f  of  the  state
 finance  law,  as  added  by section 139 of part A of chapter 389 of the
 laws of 1997, is amended to read as follows:

 
       S. 6259--B                          8                         A. 9059--B
 (a) The amount of such reimbursement shall be estimated by the commis
 sioner of taxation and finance on or before December first of  the  year
 preceding  the  state fiscal year during which such amount is to be paid
 begins. The commissioner shall use the best available information at his
 or her disposal to estimate such amount. In addition to such methods and
 information  the commissioner may use in making such estimate, he or she
 shall consult with the city department of finance during the preparation
 of the determination of such amount.  SUCH REIMBURSEMENT SHALL DISREGARD
 THE AMOUNT OF BENEFITS RECALCULATED PURSUANT TO SECTION THIRTEEN HUNDRED
 FOUR-E OF THE TAX LAW AND CREDITS DENIED PURSUANT TO  PARAGRAPH  ONE  OF
 SUBSECTION (E) OF SECTION THIRTEEN HUNDRED TEN OF THE TAX LAW.
 

S  9.  This  act  shall take effect immediately; provided however that
 sections four through seven of this act shall  apply  to  taxable  years
 beginning on or after January 1, 2012.
 PART C
 

Section  1.  The  article  heading  of  article  20 of the tax law, as
 amended by chapter 71 of the  laws  of  1959,  is  amended  to  read  as
 follows:

 TAX ON CIGARETTES, CIGARS AND TOBACCO PRODUCTS
 

S  2.  Subdivision  2  of  section  470  of the tax law, as amended by
 section 15 of part D of chapter 134 of the laws of 2010, is  amended  to
 read as follows:

 2.  "Tobacco  products."  Any  [cigar,  including  a little cigar, or]
 tobacco, other than cigarettes AND CIGARS, intended for consumption  [by
 smoking, chewing, or as snuff].
 

S  3. Subdivision 6 of section 470 of the tax law, as added by chapter
 61 of the laws of 1989, is amended to read as follows:

 6. ["Wholesale price." The established price for which a  manufacturer
 sells  tobacco  products  to  a distributor, before the allowance of any
 discount, trade allowance, rebate or other reduction.
 In the absence of such an established price, a manufacturer's  invoice
 price of any tobacco product shall be presumptive evidence of the whole-
 sale  price  of  such  tobacco  product, and in its absence the price at
 which such tobacco products were purchased shall be presumed to  be  the
 wholesale  price,  unless  evidence  of a lower wholesale price shall be
 established or any industry standard of markups relating to the purchase
 price in relation to the wholesale price shall be  established.]  "LOOSE
 TOBACCO." ANY TOBACCO PRODUCTS, OTHER THAN SNUFF AND LITTLE CIGARS.
 

S  4.  Subdivision  8  of  section  470  of the tax law, as amended by
 section 1 of part K of chapter 61 of the laws of  2005,  is  amended  to
 read as follows:

 8.  "Wholesale dealer." Any person who (a) sells cigarettes, CIGARS or
 tobacco products to retail dealers or  other  persons  for  purposes  of
 resale,  or (b) owns, operates or maintains one or more cigarette, CIGAR
 or tobacco product vending machines in, at or  upon  premises  owned  or
 occupied by any other person, or (c) sells cigarettes, CIGARS or tobacco
 products  to  an  Indian  nation  or tribe or to a reservation cigarette
 seller on a qualified reservation.
 

S 5. Subdivision 9 of section 470 of the tax law, as amended by  chap
 ter 61 of the laws of 1989, is amended to read as follows:

 9.  "Retail  dealer." Any person other than a wholesale dealer engaged
 in selling cigarettes, CIGARS or tobacco products.
 

S 6. Subdivision 12 of section 470 of the tax law, as added by chapter
 61 of the laws of 1989, is amended to read as follows:

 
       S. 6259--B                          9                         A. 9059--B
 12. "Distributor." Any person who imports or  causes  to  be  imported
 into  this state any CIGAR OR tobacco product (in excess of fifty cigars
 or one pound of tobacco) for sale, or  who  manufactures  any  CIGAR  OR
 tobacco  product  in  this  state,  and any person within or without the
 state who is authorized by the commissioner [of taxation and finance] to
 make returns and pay the tax on CIGARS OR tobacco products sold, shipped
 or delivered by [him] SUCH PERSON to any person in the state.
 

S 7. Subdivision 18 of section 470 of the tax law, as added by section
 1  of part QQ-1 of chapter 57 of the laws of 2008, is amended to read as
 follows:

 18. "Snuff." Any finely cut, ground, or powdered tobacco that  is  not
 intended  to be smoked. SNUFF INCLUDES BOTH MOIST AND DRY SNUFF, AND ANY
 SMOKELESS TOBACCO PRODUCT SIMILAR IN COMPOSITION AND  MAKEUP  TO  SNUFF.
 SNUFF DOES NOT INCLUDE CHEWING TOBACCOS SUCH AS PLUG OR TWIST TOBACCO.
 

S  8.  Subdivision  19  of  section  470 of the tax law, as amended by
 section 17 of part D of chapter 134 of the laws of 2010, is  amended  to
 read as follows:

 19.  "Cigar."  Any  roll  of tobacco wrapped in leaf tobacco or in any
 substance containing tobacco (other than any roll of tobacco that  is  a
 cigarette  as defined in subdivision one of this section). "Cigar" shall
 NOT include[, except where expressly excluded,] any little cigar.
 

S 9.

Section 470 of the tax law is amended by adding a new subdivision
 20 to read as follows:

 20. "RECEIPT." THE AMOUNT RECEIVED IN OR BY REASON OF ANY SALE, CONDI
 TIONAL OR OTHERWISE, OF CIGARS. RECEIPT IS EXPRESSED IN  MONEY,  WHETHER
 PAID  IN  CASH,  CREDIT  OR PROPERTY OF ANY KIND OR NATURE, AND SHALL BE
 DETERMINED WITHOUT ANY DEDUCTION THEREFROM ON ACCOUNT OF FEDERAL  EXCISE
 TAXES,  MANUFACTURER'S COUPONS, THE COST OF THE SERVICE SOLD OR THE COST
 OF MATERIALS, LABOR  OR  SERVICES  USED  OR  OTHER  COSTS,  INTEREST  OR
 DISCOUNT PAID OR ANY OTHER EXPENSES WHATSOEVER.
 

S  10. Paragraph (a) of subdivision 1 of section 471-b of the tax law,
 as amended by section 18 of part D of chapter 134 of the laws  of  2010,
 is amended to read as follows:

 (a)  Such  tax  on LOOSE tobacco [products other than snuff and little
 cigars] shall be at the rate of [seventy-five percent of  the  wholesale
 price]  FOUR DOLLARS AND FIFTY-THREE CENTS PER OUNCE AND A PROPORTIONATE
 RATE ON ANY FRACTIONAL PARTS OF AN OUNCE. SUCH  TAX  SHALL  BE  COMPUTED
 BASED  ON  THE NET WEIGHT AS LISTED BY THE MANUFACTURER, and is intended
 to be imposed only once upon the sale of  any  LOOSE  tobacco  [products
 other than snuff and little cigars].
 

S 11.

Section 471-b of the tax law is amended by adding a new subdivi
 sion 4 to read as follows:

 4.  THE  TAX  IMPOSED  BY THIS SECTION SHALL NOT APPLY TO CIGARS ON OR
 AFTER, JUNE FIRST, TWO THOUSAND TWELVE.
 

S 12. Subdivision (a) of section 471-c of the tax law, as  amended  by
 section  2 of part I-1 of chapter 57 of the laws of 2009, paragraphs (i)
 and (ii) as amended by section  20  and  paragraph  (iii)  as  added  by
 section  21  of part D of chapter 134 of the laws of 2010, is amended to
 read as follows:

 (a) There is hereby imposed and shall be paid a  tax  on  all  tobacco
 products  used in the state by any person, except that no such tax shall
 be imposed (1) if the tax provided in section four hundred seventy-one-b
 of this article is paid, or (2) on the use of tobacco products which are
 exempt from the tax imposed by said section, or (3) on the use  of  [two
 hundred  fifty  cigars or less, or] five pounds or less of tobacco other
 than roll-your-own tobacco[,] or thirty-six ounces or less of roll-your
 
       S. 6259--B                         10                         A. 9059--B
 own tobacco brought into the state on, or  in  the  possession  of,  any
 person.
 (i)  Such  tax  on LOOSE tobacco [products other than snuff and little
 cigars] shall be at the rate of [seventy-five percent of  the  wholesale
 price]  FOUR DOLLARS AND FIFTY-THREE CENTS PER OUNCE AND A PROPORTIONATE
 RATE ON ANY FRACTIONAL PARTS OF AN OUNCE. SUCH  TAX  SHALL  BE  COMPUTED
 BASED ON THE NET WEIGHT AS LISTED BY THE MANUFACTURER.
 (ii)  Such  tax on snuff shall be at the rate of two dollars per ounce
 and a proportionate rate on any fractional parts of an  ounce,  provided
 that  cans or packages of snuff with a net weight of less than one ounce
 shall be taxed at the equivalent rate of cans or packages  weighing  one
 ounce.  Such  tax shall be computed based on the net weight as listed by
 the manufacturer.
 (iii) Such tax on little cigars shall be at the same rate  imposed  on
 cigarettes  under  this  article and is intended to be imposed only once
 upon the sale of any little cigars.
 

S 13. The tax law is amended by adding a new section 471-f to read  as
 follows:

 

S 471-F. IMPOSITION OF CIGAR TAX. 1. THERE IS HEREBY IMPOSED AND THERE
 SHALL BE PAID A TAX OF FIFTY PERCENT UPON THE RECEIPTS FROM EVERY RETAIL
 SALE OF CIGARS, EXCEPT THAT NO TAX SHALL BE IMPOSED ON CIGARS SOLD UNDER
 SUCH  CIRCUMSTANCES THAT THIS STATE IS WITHOUT POWER TO IMPOSE SUCH TAX,
 OR SOLD TO THE UNITED STATES, OR SOLD TO OR BY A VOLUNTARY UNINCORPORAT
 ED ORGANIZATION OF THE ARMED FORCES OF THE  UNITED  STATES  OPERATING  A
 PLACE  FOR  THE SALE OF GOODS PURSUANT TO REGULATIONS PROMULGATED BY THE
 APPROPRIATE EXECUTIVE  AGENCY  OF  THE  UNITED  STATES,  TO  THE  EXTENT
 PROVIDED  IN  SUCH  REGULATIONS  AND POLICY STATEMENTS OF SUCH AN AGENCY
 APPLICABLE TO SUCH SALES.  SUCH TAX IS INTENDED TO BE IMPOSED ONLY  ONCE
 UPON THE SALE OF ANY CIGARS. IT SHALL BE PRESUMED THAT ALL CIGARS WITHIN
 THE  STATE ARE SUBJECT TO TAX UNTIL THE CONTRARY IS ESTABLISHED, AND THE
 BURDEN OF PROOF THAT ANY CIGARS ARE NOT TAXABLE HEREUNDER SHALL BE  UPON
 THE PERSON IN POSSESSION THEREOF.
 2. IT IS INTENDED THAT THE ULTIMATE INCIDENCE OF AND LIABILITY FOR THE
 TAX SHALL BE UPON THE CONSUMER, AND THAT ANY RETAIL DEALER WHO SHALL PAY
 THE  TAX TO THE COMMISSIONER SHALL COLLECT THE TAX FROM THE PURCHASER OR
 CONSUMER.
 3. THE DISTRIBUTOR SHALL BE LIABLE UNDER SECTION FOUR  HUNDRED  SEVEN
 TY-ONE-H  OF  THIS ARTICLE FOR THE PREPAYMENT OF THE CIGAR TAX ON CIGARS
 WHICH HE OR SHE IMPORTS OR CAUSES TO BE  IMPORTED  INTO  THE  STATE,  OR
 WHICH HE OR SHE MANUFACTURES IN THE STATE, AND EVERY DISTRIBUTOR AUTHOR
 IZED  BY  THE  COMMISSIONER  TO MAKE RETURNS AND PREPAY THE CIGAR TAX ON
 CIGARS SOLD, SHIPPED OR DELIVERED BY HIM OR HER TO  ANY  PERSON  IN  THE
 STATE  SHALL BE LIABLE FOR THE PREPAYMENT OF THE CIGAR TAX ON ALL CIGARS
 SO SOLD, SHIPPED OR DELIVERED.
 4. SEPARATE STATEMENT OF TAX.  DISTRIBUTORS,  WHOLESALE  DEALERS,  AND
 RETAIL  DEALERS  REQUIRED  TO COLLECT OR PASS THROUGH THE TAX IMPOSED BY
 THIS SECTION SHALL STATE, CHARGE, AND SHOW THAT TAX SEPARATELY FROM  THE
 PRICE  OR CHARGE, AND ALSO SEPARATELY FROM ANY OTHER TAX IMPOSED BY THIS
 ARTICLE OR OTHER LAW ON ANY  SALES  SLIP,  INVOICE,  RECEIPT,  OR  OTHER
 STATEMENT  OR  MEMORANDUM OF THE PRICE OR CHARGE, PAID OR PAYABLE, GIVEN
 TO THE CUSTOMER.
 

S 14. The tax law is amended by adding a new section 471-g to read  as
 follows:

 

S 471-G. USE TAX ON CIGARS.  (A) THERE IS HEREBY IMPOSED ON ALL CIGARS
 USED  IN  THE  STATE  BY  ANY  PERSON,  EXCEPT THAT NO SUCH TAX SHALL BE
 IMPOSED (1) IF THE TAX PROVIDED IN SECTION FOUR HUNDRED SEVENTY-ONE-F OF
 
       S. 6259--B                         11                         A. 9059--B
 THIS ARTICLE IS PAID, OR (2) ON THE USE OF CIGARS WHICH ARE EXEMPT  FROM
 THE  TAX  IMPOSED  BY SAID SECTION, OR (3) ON THE USE OF FIFTY CIGARS OR
 LESS BROUGHT INTO THE STATE ON, OR IN THE  POSSESSION  OF,  ANY  PERSON.
 THERE  IS  HEREBY IMPOSED AND THERE SHALL BE PAID A TAX OF FIFTY PERCENT
 UPON ALL RECEIPTS PAID OR REQUIRED TO BE PAID FROM EVERY RETAIL SALE  OF
 CIGARS.
 (B) WITHIN TWENTY-FOUR HOURS AFTER LIABILITY FOR THE TAX ACCRUES, EACH
 SUCH  PERSON  SHALL  FILE WITH THE COMMISSIONER A RETURN IN SUCH FORM AS
 THE COMMISSIONER MAY PRESCRIBE TOGETHER WITH A  REMITTANCE  OF  THE  TAX
 SHOWN  TO  BE  DUE THEREON. FOR PURPOSES OF THIS ARTICLE, THE WORD "USE"
 MEANS THE EXERCISE OF ANY RIGHT OR  POWER  ACTUAL  OR  CONSTRUCTIVE  AND
 SHALL  INCLUDE BUT IS NOT LIMITED TO THE RECEIPT, STORAGE OR ANY KEEPING
 OR RETENTION FOR ANY LENGTH OF TIME, BUT SHALL  NOT  INCLUDE  POSSESSION
 FOR SALE. ALL THE OTHER PROVISIONS OF THIS ARTICLE, IF NOT INCONSISTENT,
 SHALL  APPLY TO THE ADMINISTRATION AND ENFORCEMENT OF THE TAX IMPOSED BY
 THIS SECTION IN THE SAME MANNER AS IF THE LANGUAGE  OF  SAID  PROVISIONS
 HAD BEEN INCORPORATED IN FULL INTO THIS SECTION.
 

S  15. The tax law is amended by adding a new section 471-h to read as
 follows:

 

S 471-H. PREPAYMENT OF CIGAR TAX.  (A)(1) EVERY DISTRIBUTOR SHALL PAY,
 AS A PREPAYMENT ON ACCOUNT OF THE TAXES IMPOSED BY SECTION FOUR  HUNDRED
 SEVENTY-ONE-F  OF  THIS  ARTICLE  AND  PURSUANT TO THE AUTHORITY OF THIS
 ARTICLE, A TAX ON CIGARS POSSESSED FOR SALE OR USE IN THIS STATE, EXCEPT
 NO TAX SHALL BE REQUIRED TO BE PREPAID  ON  CIGARS  SOLD  UNDER  CIRCUM
 STANCES  THAT  THIS  STATE IS WITHOUT POWER TO IMPOSE SUCH PREPAYMENT OR
 SOLD TO THE UNITED STATES OR SOLD TO OR BY  A  VOLUNTARY  UNINCORPORATED
 ORGANIZATION  OF THE ARMED FORCES OF THE UNITED STATES OPERATING A PLACE
 FOR THE SALE OF GOODS PURSUANT TO REGULATIONS PROMULGATED BY THE  APPRO
 PRIATE  EXECUTIVE AGENCY OF THE UNITED STATES, TO THE EXTENT PROVIDED IN
 SUCH REGULATIONS AND WRITTEN POLICY STATEMENTS OF SUCH AN AGENCY  APPLI
 CABLE TO SUCH SALES.
 (2)  THE  COMMISSIONER  MAY, IN THE COMMISSIONER'S DISCRETION, REQUIRE
 ANY DISTRIBUTOR TO FILE WITH THE DEPARTMENT A BOND ISSUED  BY  A  SURETY
 COMPANY  APPROVED  BY  THE  SUPERINTENDENT  OF  FINANCIAL SERVICES AS TO
 SOLVENCY AND RESPONSIBILITY AND AUTHORIZED TO TRANSACT BUSINESS  IN  THE
 STATE  OR  OTHER SECURITY ACCEPTABLE TO THE COMMISSIONER, IN SUCH AMOUNT
 AS THE COMMISSIONER MAY FIX, TO SECURE THE PAYMENT OF ANY SUMS DUE  FROM
 SUCH  DISTRIBUTOR  PURSUANT TO THIS SECTION. IF SECURITIES ARE DEPOSITED
 AS SECURITY UNDER THIS SUBDIVISION, SUCH SECURITIES SHALL BE KEPT IN THE
 CUSTODY OF THE COMMISSIONER AND MAY BE SOLD BY THE  COMMISSIONER  IF  IT
 BECOMES  NECESSARY  TO  DO SO IN ORDER TO RECOVER ANY SUMS DUE FROM SUCH
 DISTRIBUTOR PURSUANT TO THIS SECTION, BUT NO  SUCH  SALE  SHALL  BE  HAD
 UNTIL  AFTER  SUCH DISTRIBUTOR SHALL HAVE HAD AN OPPORTUNITY TO LITIGATE
 THE VALIDITY OF ANY PREPAYMENT OF TAX IF IT ELECTS TO DO  SO.  UPON  ANY
 SUCH  SALE,  THE  SURPLUS, IF ANY, ABOVE THE SUMS DUE UNDER THIS SECTION
 SHALL BE RETURNED TO SUCH DISTRIBUTOR.
 (3) WHERE CIGARS ARE IMPORTED OR CAUSED TO BE IMPORTED INTO THE STATE,
 OR MANUFACTURED IN THE STATE, THE AMOUNT OF THE CIGAR TAX REQUIRED TO BE
 PREPAID PURSUANT TO THIS SECTION SHALL BE TWENTY CENTS ON EACH CIGAR.
 (B) EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION, THE  TAXES  REQUIRED
 TO  BE  PREPAID  PURSUANT  TO  THIS  SECTION  SHALL  BE ADMINISTERED AND
 COLLECTED IN A LIKE MANNER AS THE TAXES IMPOSED BY SECTIONS FOUR HUNDRED
 SEVENTY-ONE-F AND FOUR HUNDRED SEVENTY-ONE-G OF THIS  ARTICLE.  ALL  THE
 PROVISIONS  OF  THIS  ARTICLE  RELATING TO OR APPLICABLE TO THE ADMINIS
 TRATION, COLLECTION  AND  DISPOSITION  OF  THE  TAXES  IMPOSED  BY  SUCH
 SECTIONS  SHALL  APPLY  TO  THE  TAX  REQUIRED  TO BE PREPAID UNDER THIS
 
       S. 6259--B                         12                         A. 9059--B
 SECTION SO FAR AS SUCH PROVISIONS CAN BE MADE APPLICABLE TO SUCH PREPAY
 MENTS OF TAX WITH SUCH LIMITATIONS AS SET FORTH IN THIS ARTICLE AND SUCH
 MODIFICATIONS AS MAY BE NECESSARY IN ORDER TO ADAPT SUCH LANGUAGE TO THE
 TAX  SO  IMPOSED.  SUCH  PROVISIONS  SHALL APPLY WITH THE SAME FORCE AND
 EFFECT AS IF THE LANGUAGE OF THOSE PROVISIONS HAD BEEN SET FORTH IN FULL
 IN THIS SECTION EXCEPT TO THE EXTENT THAT ANY PROVISION IS EITHER INCON
 SISTENT WITH A PROVISION OF THIS SECTION OR IS NOT RELEVANT TO  THE  TAX
 REQUIRED  TO  BE  PREPAID BY THIS SECTION. FOR PURPOSES OF THIS SECTION,
 ANY REFERENCE IN THIS ARTICLE TO THE TAX OR TAXES  IMPOSED  BY  SECTIONS
 FOUR  HUNDRED SEVENTY-ONE-F AND FOUR HUNDRED SEVENTY-ONE-G OF THIS ARTI
 CLE SHALL BE DEEMED TO REFER TO THE TAX REQUIRED TO BE PREPAID  PURSUANT
 TO THIS SECTION UNLESS A DIFFERENT MEANING IS CLEARLY REQUIRED.
 (C)  NOTHING IN THIS ARTICLE SHALL BE CONSTRUED TO REQUIRE THE PAYMENT
 OF THE TAX REQUIRED TO BE PREPAID PURSUANT TO  THIS  SECTION  MORE  THAN
 ONCE  UPON  CIGARS POSSESSED FOR SALE OR USED WITHIN THE STATE. WHEN THE
 PREPAID TAX IMPOSED PURSUANT TO THIS SECTION IS PAID, IT SHALL HAVE BEEN
 SO PAID ON ACCOUNT OF THE TAXES IMPOSED BY SECTIONS FOUR HUNDRED  SEVEN
 TY-ONE-F  OR  FOUR HUNDRED SEVENTY-ONE-G OF THIS ARTICLE AND PURSUANT TO
 THE AUTHORITY OF THIS ARTICLE WITH RESPECT TO THE RETAIL SALE OR THE USE
 OF CIGARS. NOTHING IN THIS SECTION SHALL  MODIFY  OR  AFFECT  THE  TAXES
 IMPOSED  BY  SECTIONS FOUR HUNDRED SEVENTY-ONE-F AND FOUR HUNDRED SEVEN
 TY-ONE-G OF THIS ARTICLE AS APPLIED TO RECEIPTS FROM THE SALE, OR TO THE
 USE, OF SUCH CIGARS.
 (D) THE DISTRIBUTOR SHALL BE LIABLE FOR  THE  PREPAID  TAX  ON  CIGARS
 WHICH  HE  OR  SHE  IMPORTS  OR CAUSES TO BE IMPORTED INTO THE STATE, OR
 WHICH HE OR SHE MANUFACTURES IN THE STATE, AND EVERY DISTRIBUTOR AUTHOR
 IZED BY THE COMMISSIONER TO MAKE RETURNS AND  PAY  THE  PREPAID  TAX  ON
 CIGARS  SOLD,  SHIPPED  OR  DELIVERED BY HIM OR HER TO ANY PERSON IN THE
 STATE SHALL BE LIABLE FOR THE PREPAID TAX ON ALL CIGARS SO SOLD, SHIPPED
 OR DELIVERED.
 

S 16. The tax law is amended by adding a new section 471-i to read  as
 follows:

 

S 471-I. REFUNDS AND CREDITS WITH RESPECT TO CIGARS.
 (A)  RETAIL  DEALER.    (1)  A RETAIL DEALER OF CIGARS WHO OR WHICH IS
 REQUIRED  TO  COLLECT  THE  TAXES  IMPOSED  BY  SECTION   FOUR   HUNDRED
 SEVENTY-ONE-F  OF  THIS  ARTICLE  SHALL  BE  ALLOWED  A REFUND OR CREDIT
 AGAINST THE AMOUNT OF TAX COLLECTED AND REQUIRED TO BE REMITTED  TO  THE
 COMMISSIONER  PURSUANT  TO THE PROVISIONS OF SECTION FOUR HUNDRED SEVEN
 TY-ONE-F OF THIS ARTICLE UPON THE RETAIL SALE OF CIGARS IN THE AMOUNT OF
 THE TAX ON SUCH CIGARS PREPAID BY OR PASSED THROUGH TO AND  INCLUDED  IN
 THE  PRICE  PAID  BY  SUCH  RETAIL  DEALER PURSUANT TO THE PROVISIONS OF
 SECTION FOUR HUNDRED SEVENTY-ONE-H OF THIS ARTICLE.
 (2) A REFUND OR CREDIT SHALL ALSO BE ALLOWED SUCH  RETAIL  DEALER  FOR
 THE  TAX  PREPAID BY OR PASSED THROUGH TO AND INCLUDED IN THE PRICE PAID
 BY SUCH RETAIL DEALER UPON ANY CIGARS  PURSUANT  TO  THE  PROVISIONS  OF
 SECTION  FOUR  HUNDRED  SEVENTY-ONE-F OF THIS ARTICLE IF SUCH CIGARS ARE
 SOLD AT RETAIL BY SUCH RETAIL DEALER UNDER CIRCUMSTANCES WHERE THE TAXES
 IMPOSED BY SECTION FOUR HUNDRED SEVENTY-ONE-F OF THIS ARTICLE AND PURSU
 ANT TO THE AUTHORITY OF THIS ARTICLE ARE NOT REQUIRED BY THE  PROVISIONS
 OF THIS ARTICLE TO BE COLLECTED AND REMITTED UPON RECEIPTS FROM A RETAIL
 SALE THEREOF.
 (B)  EXPORT,  DESTRUCTION, TAX PAID IN ERROR. WHENEVER ANY CIGARS UPON
 WHICH THE PREPAID TAX IMPOSED BY SECTION FOUR HUNDRED  SEVENTY-ONE-H  OF
 THIS  ARTICLE  HAS BEEN PAID HAVE BEEN SOLD AND SHIPPED TO ANOTHER STATE
 FOR SALE OR USE THERE OR HAVE BECOME UNFIT FOR USE OR UNSALABLE, OR HAVE
 BEEN DESTROYED, OR WHENEVER THE COMMISSIONER SHALL HAVE DETERMINED  THAT
 
       S. 6259--B                         13                         A. 9059--B
 ANY   TAX   REQUIRED   TO  BE  PREPAID  BY  SUCH  SECTION  FOUR  HUNDRED
 SEVENTY-ONE-H OF THIS  ARTICLE  SHALL  HAVE  BEEN  PAID  IN  ERROR,  THE
 DISTRIBUTOR OR DEALER, AS THE CASE MAY BE, SHALL BE ENTITLED TO A REFUND
 OR  CREDIT  OF  THE ACTUAL AMOUNT OF PREPAID TAX SO PAID WITH RESPECT TO
 CIGARS WHICH WILL NOT BE POSSESSED FOR SALE OR USE IN THIS STATE.
 (C) REFUNDS OF  THE  TAX  REQUIRED  TO  BE  PREPAID  PURSUANT  TO  THE
 PROVISIONS  OF  SECTION FOUR HUNDRED SEVENTY-ONE-H OF THIS ARTICLE SHALL
 BE ALLOWED ONLY TO THE EXTENT SUCH TAX PAID BY OR PASSED THROUGH TO  THE
 RETAIL  DEALER,  OR  THE  PURCHASER  OR  USER, EXCEEDS THE AMOUNT OF TAX
 REQUIRED TO BE COLLECTED FROM SUCH PERSON OR REQUIRED TO BE REMITTED  BY
 THE PROVISIONS OF THIS ARTICLE.
 (D) A REFUND OR CREDIT SHALL BE ALLOWED UNDER THIS SECTION ONLY TO THE
 EXTENT  THAT  THE  TAX  REQUIRED  TO BE PREPAID PURSUANT TO SECTION FOUR
 HUNDRED SEVENTY-ONE-H OF THIS ARTICLE HAS  BEEN  PREPAID  BY  OR  PASSED
 THROUGH TO SUCH RETAIL DEALER, PURCHASER OR USER, BUT ONLY TO THE EXTENT
 THAT THE TAX IMPOSED BY SECTION FOUR HUNDRED SEVENTY-ONE-F OF THIS ARTI
 CLE  TOGETHER WITH THE TAX IMPOSED BY SECTION FOUR HUNDRED SEVENTY-ONE-G
 OF THIS ARTICLE REQUIRED TO BE PAID, COLLECTED  AND  REMITTED  HAS  BEEN
 PAID, COLLECTED AND REMITTED.
 (E)  SUCH  REFUNDS  AND  CREDITS SHALL BE SUBJECT TO THE PROVISIONS OF
 SECTION FOUR HUNDRED SEVENTY-SIX OF THIS ARTICLE AS IF SUCH SECTION  WAS
 INCORPORATED IN FULL INTO THIS SECTION AND HAD EXPRESSLY REFERRED TO THE
 REFUNDS  AND CREDITS AUTHORIZED BY THIS SECTION INCLUDING THE PERIODS OF
 LIMITATIONS ON PAYMENTS AND APPLICATIONS TO THE COMMISSIONER;  PROVIDED,
 HOWEVER,  THAT,  AS PROVIDED IN SECTION FOUR HUNDRED SEVENTY-SIX OF THIS
 ARTICLE, NO INTEREST SHALL BE ALLOWED OR PAID UPON ANY  REFUND  MADE  OR
 CREDIT ALLOWED PURSUANT TO SUBDIVISIONS (A) AND (B) OF THIS SECTION. THE
 COMMISSIONER  SHALL  PROCESS APPLICATIONS FOR REFUND AS EXPEDITIOUSLY AS
 POSSIBLE.
 

S 17. The tax law is amended by adding a new section 471-j to read  as
 follows:

 

S  471-J.  SPECIAL  PROVISION  AS  TO  IMPOSITION  OF TAXES ON CERTAIN
 CIGARS. IF A PERSON SHALL RECEIVE ANY CIGARS,  UPON  WHICH  CIGARS  THIS
 STATE WAS WITHOUT POWER TO IMPOSE THE TAXES UNDER THIS ARTICLE, AND SUCH
 PERSON  SHALL  THEREAFTER  POSSESS  SUCH CIGARS FOR SALE OR USE ANY SUCH
 CIGARS IN SUCH MANNER AND UNDER SUCH CIRCUMSTANCES AS  MAY  SUBJECT  THE
 SAME  TO  THE TAXING POWER OF THIS STATE WITH RESPECT TO SUCH POSSESSION
 FOR SALE OR USE, SUCH PERSON SHALL BE LIABLE  FOR  THE  TAX  IMPOSED  BY
 SECTION FOUR HUNDRED SEVENTY-ONE-F OR FOUR HUNDRED SEVENTY-ONE-G OF THIS
 ARTICLE,  AS THE CASE MAY BE WITH RESPECT TO SUCH SALE OR USE, AND SHALL
 MAKE THE SAME REPORTS AND RETURNS, PAY THE SAME TAXES AND BE SUBJECT  TO
 ALL  OTHER PROVISIONS OF THIS ARTICLE RELATING TO DISTRIBUTORS OR RETAIL
 DEALERS, EXCEPT  THAT  SUCH  A  PERSON  SHALL  NOT  BE  SUBJECT  TO  THE
 PROVISIONS  OF SECTIONS FOUR HUNDRED SEVENTY-TWO AND FOUR HUNDRED EIGHTY
 OF THIS ARTICLE IF SUCH PERSON DOES NOT OFFER CIGARS FOR SALE.
 

S 18. The tax law is amended by adding a new section 471-k to read  as
 follows:

 

S  471-K.  COLLECTION  OF  TAX  FROM  CUSTOMER;  FILING OF RETURNS AND
 PAYMENT.
 (A)(1) EVERY RETAIL DEALER SHALL COLLECT THE TAX  IMPOSED  BY  SECTION
 FOUR  HUNDRED  SEVENTY-ONE-F  OF  THIS  ARTICLE  FROM  THE CUSTOMER WHEN
 COLLECTING THE RECEIPT TO WHICH IT APPLIES. EACH CUSTOMER SHALL BE GIVEN
 SOME INDICIA OF SALE, INCLUDING SALES SLIP, INVOICE,  RECEIPT  OR  OTHER
 STATEMENT  OR MEMORANDUM OF THE PRICE, UPON WHICH THE TAX SHALL BE STAT
 ED, CHARGED AND SHOWN SEPARATELY.
 
       S. 6259--B                         14                         A. 9059--B
 (2) EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION, ALL  THE  PROVISIONS
 OF ARTICLE TWENTY-EIGHT OF THIS CHAPTER RELATING TO THE PERSONAL LIABIL
 ITY FOR THE TAX, ADMINISTRATION AND COLLECTION AND DETERMINATION OF TAX,
 INCLUDING  SECTION  ELEVEN HUNDRED THIRTY-EIGHT OF THIS CHAPTER RELATING
 TO  DETERMINATION OF TAX BUT NOT INCLUDING SECTION ELEVEN HUNDRED FORTY
 FIVE OF THIS CHAPTER, SHALL APPLY TO THE TAX  IMPOSED  BY  SECTION  FOUR
 HUNDRED  SEVENTY-ONE-F  OF  THIS ARTICLE IN THE SAME MANNER AND WITH THE
 SAME FORCE AND EFFECT AS IF THE LANGUAGE  OF  SUCH  PROVISIONS  OF  SUCH
 ARTICLE  TWENTY-EIGHT  HAD  BEEN INCORPORATED IN FULL INTO THIS ARTICLE,
 EXCEPT TO THE EXTENT THAT ANY SUCH PROVISION IS EITHER INCONSISTENT WITH
 A PROVISION OF THIS SECTION OR IS NOT RELEVANT  THERETO  AND  WITH  SUCH
 OTHER  MODIFICATIONS  AS  MAY BE NECESSARY TO ADAPT THE LANGUAGE OF SUCH
 PROVISIONS TO THE PROVISIONS OF  THIS  SECTION.  PROVIDED,  HOWEVER  ALL
 TAXES,  INTEREST AND PENALTIES COLLECTED OR RECEIVED BY THE COMMISSIONER
 UNDER SECTIONS FOUR HUNDRED SEVENTY-ONE-F, FOUR  HUNDRED  SEVENTY-ONE-G,
 AND  FOUR  HUNDRED  SEVENTY-ONE-H OF THIS ARTICLE SHALL BE DEPOSITED AND
 DISPOSED OF PURSUANT TO SECTION FOUR HUNDRED EIGHTY-TWO OF THIS ARTICLE.
 PROVIDED, THE COMMISSIONER MAY REQUIRE RETURNS TO BE FILED WITH  HIM  OR
 HER  AT  SUCH  TIMES  AND  CONTAINING  SUCH INFORMATION AS HE OR SHE MAY
 PRESCRIBE.
 (B) (1) (I) NO PERSON SHALL PURCHASE CIGARS IN THIS STATE, EXCLUDING A
 PURCHASE AT RETAIL, UNLESS THE TAX REQUIRED TO  BE  PREPAID  BY  SECTION
 FOUR  HUNDRED  SEVENTY-ONE-H  OF  THIS  ARTICLE  HAS  BEEN  ASSUMED BY A
 DISTRIBUTOR REGISTERED UNDER THIS ARTICLE IN ACCORDANCE WITH  A  CERTIF
 ICATION  UNDER  THIS PARAGRAPH OR PAID BY SUCH DISTRIBUTOR, AND, IN EACH
 OF SUCH INSTANCES, IS PASSED THROUGH TO SUCH PURCHASER. IN  ADDITION  TO
 ANY  OTHER  CIVIL AND CRIMINAL PENALTIES WHICH MAY APPLY, ANY PERSON WHO
 PURCHASES CIGARS IN VIOLATION OF THIS SUBPARAGRAPH SHALL BE JOINTLY  AND
 SEVERALLY  LIABLE  TO PAY THE TAX REQUIRED TO BE PREPAID BY SECTION FOUR
 HUNDRED SEVENTY-ONE-H OF THIS ARTICLE WITH RESPECT TO SUCH CIGARS.
 (II) FOR THE PURPOSE OF THE PROPER ADMINISTRATION OF THIS ARTICLE  AND
 TO  PREVENT EVASION OF THE TAX ON CIGARS IMPOSED BY AND PURSUANT TO THIS
 ARTICLE, IT SHALL BE PRESUMED THAT ALL CIGARS IMPORTED, MANUFACTURED  OR
 SOLD,  RECEIVED  OR POSSESSED IN THE STATE IS INTENDED FOR USE, DISTRIB
 UTION, STORAGE OR SALE IN THE STATE AND SUBJECT TO THE TAX  REQUIRED  TO
 BE  PREPAID  BY SECTION FOUR HUNDRED SEVENTY-ONE-H OF THIS ARTICLE UNTIL
 THE CONTRARY IS ESTABLISHED. IT  SHALL  BE  FURTHER  PRESUMED  THAT  ALL
 CIGARS  SO  IMPORTED,  MANUFACTURED,  SOLD, RECEIVED OR POSSESSED IN THE
 STATE BY ANY PERSON ARE SUBJECT TO THE TAX REQUIRED TO BE PREPAID  UNDER
 SECTION  FOUR  HUNDRED  SEVENTY-ONE-H OF THIS ARTICLE AND SUCH PERSON IS
 RESPONSIBLE FOR SUCH PREPAYMENT. THE BURDEN OF PROVING THAT  ANY  CIGARS
 ARE  NOT  SO  SUBJECT  SHALL  BE UPON THE PERSON SO RESPONSIBLE FOR SUCH
 PREPAYMENT WITH RESPECT TO SUCH CIGARS.
 (III) UPON EACH SALE OF CIGARS, OTHER THAN A SALE AT RETAIL, THE SELL
 ER MUST GIVE TO THE PURCHASER AND THE PURCHASER SHALL  RECEIVE,  AT  THE
 TIME  OF DELIVERY OF SUCH CIGARS, A CERTIFICATION CONTAINING SUCH INFOR
 MATION AS THE COMMISSIONER SHALL REQUIRE WHICH SHALL INCLUDE A STATEMENT
 TO THE EFFECT (A) IF SUCH SELLER IS A DISTRIBUTOR REGISTERED UNDER  THIS
 ARTICLE,  THAT  HE  OR  SHE  HAS  ASSUMED THE PAYMENT OF OR PAID THE TAX
 REQUIRED TO BE PREPAID BY SECTION FOUR  HUNDRED  SEVENTY-ONE-H  OF  THIS
 ARTICLE  AND, IN EACH CASE, IS PASSING THROUGH SUCH TAX OR (B) THAT SUCH
 SELLER IS PASSING THROUGH SUCH TAX WHICH WAS SO  PREVIOUSLY  ASSUMED  OR
 PAID  BY  AN IDENTIFIED DISTRIBUTOR OR WHOLESALE DEALER REGISTERED UNDER
 THIS ARTICLE, AND PASSED THROUGH TO HIM OR HER.
 (IV)  IF  THE  CERTIFICATION  REQUIRED  BY  THIS  PARAGRAPH  HAS  BEEN
 FURNISHED  TO  THE  PURCHASER  BY THE SELLER AT DELIVERY AND ACCEPTED IN
 
       S. 6259--B                         15                         A. 9059--B
 GOOD FAITH, THE BURDEN OF PROVING THAT THE TAX REQUIRED TO  BE  PAID  BY
 SECTION  FOUR  HUNDRED SEVENTY-ONE-H OF THIS ARTICLE WAS ASSUMED OR PAID
 BY A DISTRIBUTOR REGISTERED UNDER THIS ARTICLE AND PASSED THROUGH  SHALL
 BE SOLELY ON THE SELLER.
 (V)  WHERE  THE  CERTIFICATION  REQUIRED  UNDER  THIS PARAGRAPH IS NOT
 FURNISHED BY THE SELLER AT DELIVERY OF CIGARS, IT SHALL BE PRESUMED THAT
 THE TAX REQUIRED TO BE PREPAID BY SECTION FOUR HUNDRED SEVENTY-ONE-H  OF
 THIS ARTICLE HAS NOT BEEN ASSUMED OR PAID BY A DISTRIBUTOR REGISTERED AS
 SUCH  UNDER  THIS ARTICLE AND THAT THE PURCHASER IN SUCH CASE IS JOINTLY
 AND SEVERALLY LIABLE FOR THE TAX.
 

S 19. Subdivision 3 of section 472 of the tax law, as added by chapter
 61 of the laws of 1989 and as further amended by section 104 of  part  A
 of chapter 62 of the laws of 2011, is amended to read as follows:

 3.  The  commissioner [of taxation and finance] may appoint dealers in
 CIGARS  AND  tobacco  products,  manufacturers  of  CIGARS  AND  tobacco
 products  and  other persons within or without the state as distributors
 and may authorize them to make returns and to pay the tax on CIGARS  AND
 tobacco products sold, shipped or delivered by them to any person in the
 state.  The  commissioner  may,  in  his  OR HER discretion, require the
 deposit of a bond issued by a surety company approved by the superinten
 dent of financial services as to solvency and responsibility and author
 ized to transact business in this state, or other security acceptable to
 the commissioner in an amount and form satisfactory to him OR HER  as  a
 condition  of appointing any such person as a distributor. If securities
 are deposited as security under this subdivision, such securities  shall
 be kept in the custody of the commissioner [of taxation and finance] and
 may  be  sold  by  the  commissioner if it becomes necessary so to do in
 order to recover any sums due from such  distributor  pursuant  to  this
 article,  but  no  such  sale  shall be had until after such distributor
 shall have had an opportunity to litigate the validity of any tax if  it
 elects so to do. Upon any such sale, the surplus, if any, above the sums
 due under this article shall be returned to such distributor.
 

S 20.

Section 473-a of the tax law, as added by chapter 61 of the laws
 of 1989, is amended to read as follows:

 

S  473-a.  Returns  and payment of CIGARS PREPAID AND tobacco products
 [tax] TAXES by distributors.   1. (A) Every  distributor  shall,  on  or
 before  the  twentieth day of each month, file with the commissioner [of
 taxation and finance] a return on forms to be prescribed  and  furnished
 by  the  commissioner, showing the quantity and [wholesale price] WEIGHT
 of all tobacco products OR QUANTITY OF CIGARS imported or caused  to  be
 imported  into  the  state by him OR HER or manufactured in the state by
 him OR HER, during  the  preceding  calendar  month.  Every  distributor
 authorized by the commissioner to make returns and pay the tax on CIGARS
 OR  tobacco  products  sold,  shipped  or delivered by him OR HER to any
 person in the state shall file a return showing the quantity and [whole-
 sale price] WEIGHT of all tobacco products so sold, shipped or delivered
 during the preceding calendar month. Provided, however, the commissioner
 may, if he OR SHE deems it necessary in order to insure the  payment  of
 the  taxes  imposed  by this article, require returns to be made at such
 times and covering such periods as he OR SHE may deem necessary, and, by
 regulation, may permit the filing of returns on a quarterly, semi-annual
 or annual basis, or may waive the filing of returns by a distributor for
 such time and upon such terms as he OR SHE may deem proper if  satisfied
 that  no tax imposed by this article is or will be payable by him OR HER
 during the time for which returns are waived. Such returns shall contain
 such further information as the commissioner may require.
 
       S. 6259--B                         16                         A. 9059--B
 (B) EVERY DISTRIBUTOR SHALL, ON OR BEFORE THE TWENTIETH  DAY  OF  EACH
 MONTH, FILE WITH THE COMMISSIONER A RETURN ON FORMS TO BE PRESCRIBED AND
 FURNISHED  BY  THE  COMMISSIONER,  SHOWING  THE  QUANTITY  OF ALL CIGARS
 IMPORTED OR CAUSED TO BE IMPORTED INTO THE STATE BY HIM OR HER OR  MANU
 FACTURED  IN  THE  STATE  BY  HIM  OR HER, DURING THE PRECEDING CALENDAR
 MONTH. EVERY DISTRIBUTOR AUTHORIZED BY THE COMMISSIONER TO MAKE  RETURNS
 AND  PAY  THE  CIGAR PREPAID TAX ON CIGARS SOLD, SHIPPED OR DELIVERED BY
 HIM OR HER TO ANY PERSON IN THE STATE SHALL FILE A  RETURN  SHOWING  THE
 QUANTITY  OF ALL CIGARS SO SOLD, SHIPPED OR DELIVERED DURING THE PRECED
 ING CALENDAR MONTH. PROVIDED, HOWEVER, THE COMMISSIONER MAY,  IF  HE  OR
 SHE  DEEMS  IT  NECESSARY  IN  ORDER  TO INSURE THE PAYMENT OF THE CIGAR
 PREPAID TAX IMPOSED BY THIS ARTICLE, REQUIRE RETURNS TO BE MADE AT  SUCH
 TIMES AND COVERING SUCH PERIODS AS HE OR SHE MAY DEEM NECESSARY, AND, BY
 REGULATION, MAY PERMIT THE FILING OF RETURNS ON A QUARTERLY, SEMI-ANNUAL
 OR ANNUAL BASIS, OR MAY WAIVE THE FILING OF RETURNS BY A DISTRIBUTOR FOR
 SUCH  TIME AND UPON SUCH TERMS AS HE OR SHE MAY DEEM PROPER IF SATISFIED
 THAT NO CIGAR PREPAID TAX IMPOSED BY THIS ARTICLE IS OR WILL BE  PAYABLE
 BY HIM OR HER DURING THE TIME FOR WHICH RETURNS ARE WAIVED. SUCH RETURNS
 SHALL CONTAIN SUCH FURTHER INFORMATION AS THE COMMISSIONER MAY REQUIRE.
 2.  Every distributor shall pay to the commissioner with the filing of
 such return the tax on CIGARS OR tobacco products for such month imposed
 under this article.
 

S 21. Subdivisions 2, 3 and 4 of section 474 of the tax law,  subdivi
 sion  2  as amended by chapter 552 of the laws of 2008, subdivision 3 as
 added and subdivision 4 as amended by chapter 61 of the  laws  of  1989,
 are amended to read as follows:

 2. Every person who shall possess or transport more than [two hundred]
 fifty  cigars, or more than five pounds of tobacco other than roll-your
 own tobacco[,] or more than thirty-six ounces of  roll-your-own  tobacco
 upon  the  public  highways,  roads  or  streets  of the state, shall be
 required to have in [his] SUCH PERSON'S actual  possession  invoices  or
 delivery  tickets  for such CIGARS OR tobacco products. Such invoices or
 delivery tickets shall show the name and address  of  the  consignor  or
 seller,  the  name  and  address  of  the  consignee  or  purchaser, the
 quantity, WEIGHT and brands of the CIGARS  OR  tobacco  products  trans
 ported,  and  the name and address of the person who has or shall assume
 the payment of the tax [and the wholesale price]  or  the  tax  paid  or
 payable. The absence of such invoices or delivery tickets shall be prima
 facie  evidence  that  such  person  is  a  dealer  in CIGARS OR tobacco
 products in this state and subject to the requirements of this article.
 3. Every dealer or distributor or employee thereof,  or  other  person
 acting on behalf of a dealer or distributor, who shall possess or trans
 port  more  than fifty cigars or more than one pound of tobacco upon the
 public highways, roads or streets of the state,  shall  be  required  to
 have  in  his  OR HER actual possession invoices or delivery tickets for
 such CIGARS OR tobacco products. Such invoices or delivery tickets shall
 show the name and address of the  consignor  or  seller,  the  name  and
 address  of  the consignee or purchaser, the quantity, WEIGHT and brands
 of the CIGARS OR tobacco products transported, and the name and  address
 of  the  person  who has or shall assume the payment of the tax [and the
 wholesale price] or the  tax  paid  or  payable.  The  absence  of  such
 invoices  or delivery tickets shall be prima facie evidence that the tax
 imposed by this article on CIGARS OR tobacco products has not been  paid
 and is due and owing.
 4.  At  the  time of delivering cigarettes to any person each agent or
 wholesale dealer, and at  the  time  of  delivering  CIGARS  OR  tobacco
 
       S. 6259--B                         17                         A. 9059--B
 products to any person each distributor or wholesale dealer of CIGARS OR
 tobacco  products,  shall make a true duplicate invoice showing the date
 of delivery, the number of packages and number of  cigarettes  contained
 therein,  in  each  shipment  of cigarettes delivered, and the items and
 quantity and [wholesale price] WEIGHT of each item in each  shipment  of
 tobacco  products  OR  QUANTITY OF CIGARS delivered, and the name of the
 purchaser to whom delivery is made, and shall  retain  the  same  for  a
 period  of  three years subject to the use and inspection of the commis
 sioner [of taxation and finance]. Each dealer shall procure  and  retain
 invoices  showing  the  number  of  packages  and  number  of cigarettes
 contained therein, in each shipment of cigarettes  received  by  him  OR
 HER,  and  the  items  and quantity and [wholesale price] WEIGHT of each
 item in each shipment of CIGARS OR tobacco products received by  him  OR
 HER, the date thereof, and the name of the shipper, and shall retain the
 same  for  a  period of three years subject to the use and inspection of
 the commissioner [of taxation and finance]. The commissioner  [of  taxa-
 tion  and  finance]  by regulation may provide that whenever cigarettes,
 CIGARS or tobacco products are shipped  into  the  state,  the  railroad
 company,  express  company,  trucking  company  or  other public carrier
 transporting any shipment thereof shall file with the  commissioner  [of
 taxation  and  finance] a copy of the freight bill within ten days after
 the delivery in the state of each shipment. All dealers  shall  maintain
 and  keep  for a period of three years such other records of cigarettes,
 CIGARS or tobacco products received, sold or delivered within the  state
 as  may  be  required by the commissioner [of taxation and finance]. The
 commissioner [of taxation and finance] is hereby authorized  to  examine
 the  books,  papers,  invoices  and  other  records  of  any  person  in
 possession, control or  occupancy  of  any  premises  where  cigarettes,
 CIGARS or tobacco products are placed, stored, sold or offered for sale,
 and the equipment of any such person pertaining to the stamping of ciga
 rettes  or  the  sale  and  delivery  of  cigarettes,  CIGARS or tobacco
 products taxable under this article, as well as the stock of cigarettes,
 CIGARS or tobacco products in any such premises or  vehicle.  To  verify
 the  accuracy of the tax imposed and assessed by this article, each such
 person is hereby directed and required to give to the  commissioner  [of
 taxation and finance] or his OR HER duly authorized representatives, the
 means,  facilities  and  opportunity for such examinations as are herein
 provided for and required.
 

S 22. The section heading of section 475 of the tax law, as amended by
 chapter 227 of the laws of 1956, is amended to read as follows:

 General powers of the [tax commission] COMMISSIONER.
 

S 23.

Section 476 of the tax law, as amended by chapter 61 of the laws
 of 1989, is amended to read as follows:

 

S 476. Refunds; sales of stamps. Whenever any  cigarettes  upon  which
 stamps have been placed or CIGARS OR tobacco products upon which the tax
 has  been paid have been sold and shipped into another state for sale or
 use there or have become unfit for use and consumption or unsalable,  or
 have  been  destroyed,  or  whenever  the  commissioner [of taxation and
 finance] shall have determined that any  tax  imposed  by  this  article
 shall  have  been  paid  in error, the agent, dealer or CIGAR OR tobacco
 products distributor, as the case may be, shall be entitled to a  refund
 of  the  actual  amount of tax so paid, provided application therefor is
 filed with the commissioner [of taxation and finance] within  two  years
 after  the  stamps  were  affixed to such cigarettes or the tax was paid
 upon such CIGARS OR tobacco products, except if an agreement  under  the
 provisions  of  section  four  hundred  seventy-eight  OF  THIS  ARTICLE
 
       S. 6259--B                         18                         A. 9059--B
 (extending the period for determination of tax imposed by this  article)
 is  made within the two-year period for the filing of an application for
 refund provided for in this section, the period for filing  an  applica
 tion  for  refund shall not expire prior to six months after the expira
 tion of the period within which a determination may be made pursuant  to
 the agreement or any extension thereof. If the commissioner [of taxation
 and  finance] is satisfied that any dealer is entitled to a refund he OR
 SHE shall issue to such dealer stamps of sufficient value to  cover  the
 refund  of  the  tax on cigarettes or may, subject to audit by the comp
 troller, make a refund of the tax on cigarettes or on CIGARS OR  tobacco
 products.  No  person  shall  sell or offer for sale any stamp or stamps
 issued under this article except by written permission  of  the  commis
 sioner  [of  taxation  and  finance].  The commissioner [of taxation and
 finance] may redeem unused stamps lawfully in possession of any  person.
 The commissioner [of taxation and finance] may prescribe necessary rules
 and  regulations  concerning  refunds,  sales of stamps, and redemptions
 under the provisions of this article.
 

S 24. Paragraph (d) of subdivision 1 of section 480 of the tax law, as
 added by chapter 629 of the laws of 1996, is amended to read as follows:

 (d) Each applicant shall file satisfactory proof that it will maintain
 a secure separate warehousing facility for the purpose of receiving  and
 distributing  cigarettes,  CIGARS or tobacco products and conducting its
 wholesale business. Such proof shall consist of a copy of a deed,  or  a
 copy  of an executed lease for a minimum period of two years, to a sepa
 rate, secure warehouse. If the applicant carries on another business  in
 conjunction  with  the warehouse facility, the other business shall also
 be identified.
 

S 25. Paragraph (j) of subdivision 1 of section 480 of the tax law, as
 amended by chapter 629 of the laws  of  1996,  is  amended  to  read  as
 follows:

 (j)  The commissioner may for cause refuse to issue, or may suspend or
 revoke a wholesaler's license, or may forbid a retail dealer to continue
 selling cigarettes, CIGARS or tobacco products or may  forbid  a  person
 required  to be appointed as a distributor of CIGARS OR tobacco products
 who has not been so appointed from selling cigarettes, CIGARS or tobacco
 products,  after  an  opportunity  for  hearing  has  been  afforded.  A
 violation  of  any provision of this article or of any regulation issued
 under it shall be cause to forbid a retail dealer  to  continue  selling
 cigarettes, CIGARS or tobacco products.
 

S 26. Paragraph (k) of subdivision 1 of section 480 of the tax law, as
 amended  by  chapter  262  of  the  laws  of 2000, is amended to read as
 follows:

 (k) No agent shall sell  cigarettes  and  no  distributor  shall  sell
 CIGARS  OR  tobacco  products to an unlicensed wholesale dealer, or to a
 wholesale dealer whose license has been suspended or revoked,  or  to  a
 retail  dealer who is not registered under section four hundred eighty-a
 of this article, or whose registration has been  suspended  or  revoked,
 and  no  wholesale  dealer  shall  sell  cigarettes,  CIGARS  or tobacco
 products to a retail dealer who is not  registered  under  section  four
 hundred  eighty-a  of  this  article,  or  whose  registration  has been
 suspended or revoked, and no retail dealer shall sell cigarettes, CIGARS
 or tobacco products unless such dealer is registered under section  four
 hundred eighty-a of this article.
 

S 27. Paragraph (l) of subdivision 1 of section 480 of the tax law, as
 added by chapter 629 of the laws of 1996, is amended to read as follows:

 
       S. 6259--B                         19                         A. 9059--B
 (l) Paragraphs (b), (c) and (g) of this subdivision shall not apply to
 the filing of an application for a license as a wholesale dealer that is
 based solely upon the ownership, operation or maintenance of one or more
 cigarette,  CIGAR  or  tobacco  products vending machines in, at or upon
 premises  owned  or  occupied by another person, or that is based solely
 upon the sale of CIGARS OR tobacco products for resale, or that is based
 upon both the ownership, operation or maintenance of one or  more  ciga
 rette,  CIGAR  or tobacco products vending machines in, at or upon prem
 ises owned or occupied by another person  and  the  sale  of  CIGARS  OR
 tobacco products for resale.
 

S  28.  Subparagraph (iv) of paragraph (b) of subdivision 3 of section
 480 of the tax law, as amended by chapter 61 of the  laws  of  1989,  is
 amended to read as follows:

 (iv) Has knowingly aided and abetted the sale of cigarettes, CIGARS or
 tobacco  products  by a person which such licensee or controlling person
 knows (A) has not been licensed by the  commissioner  [of  taxation  and
 finance] and (B) is a wholesale dealer pursuant to the terms of subdivi
 sion eight of section four hundred seventy of this [chapter] ARTICLE.
 

S 29. Subdivision 4 of section 480 of the tax law, as amended by chap
 ter 61 of the laws of 1989, is amended to read as follows:

 4.  If  the commissioner [of taxation and finance] considers it neces
 sary for the proper administration of the cigarette tax,  CIGAR  TAX  or
 tobacco  products tax imposed by this article or the cigarette marketing
 standards contained in article twenty-A of this chapter he  OR  SHE  may
 require  every  person  under this article who holds a license to file a
 new application for a license in such form  and  at  such  time  as  the
 commissioner  may  prescribe  and to surrender such license. The commis
 sioner may require such filing and such surrender not  more  often  than
 once  every  three  years.  Upon the filing of such application with the
 proper fee and the surrender of such  license,  the  commissioner  shall
 issue,  within  such  time  as he OR SHE may prescribe, a new license to
 each applicant.
 

S 30. Paragraphs (a) and (b) of subdivision 1 of section 480-a of  the
 tax  law,  as  added  by chapter 190 of the laws of 1990, are amended to
 read as follows:

 (a) [On and after January first, nineteen hundred  ninety-one,  every]
 EVERY retail dealer shall publicly display a certificate of registration
 from  the  department  in  each  place of business in this state through
 which it sells cigarettes, CIGARS  or  tobacco  products  at  retail.  A
 retail  dealer  who  has  no  regular  place  of business shall publicly
 display such certificate on each of its carts, stands, trucks  or  other
 merchandising  devices  through  which  it  sells  cigarettes, CIGARS or
 tobacco products in this state.
 (b) Every person who owns or, if the owner is not the  operator,  then
 any person who operates one or more vending machines through which ciga
 rettes, CIGARS or tobacco products are sold in this state, regardless of
 whether  located on the premises of the vending machine owner or, if the
 owner is not the operator, then the premises  of  the  operator  or  the
 premises  of  any  other person, must register each such vending machine
 with the department. [On and after January first, nineteen hundred nine-
 ty-one, a] A vending machine registration certificate, in such  form  as
 may  be  prescribed by the commissioner [of taxation and finance], shall
 be affixed to each vending machine through which cigarettes,  CIGARS  or
 tobacco products are sold in this state.
 
       S. 6259--B                         20                         A. 9059--B
 

S  31. Paragraphs (a) and (b) of subdivision 2 of section 480-a of the
 tax law, as amended by section 1 of part T of chapter 61 of the laws  of
 2011, are amended to read as follows:

 (a)  (i)  Every retail dealer and every person owning or, if the owner
 is not the operator, then any  person  operating  one  or  more  vending
 machines  through  which cigarettes, CIGARS or tobacco products are sold
 in this state, who is required under section eleven  hundred  thirty-six
 of  this chapter to file a return for the quarterly period ending on the
 last day of August OF EACH YEAR, [nineteen hundred  ninety  or  for  the
 quarterly  period ending on the last day of August in any year thereaft-
 er,] must file an application for registration under this  section  with
 that  quarterly  return,  in  such  form  as  shall be prescribed by the
 commissioner.
 (ii) Each retail dealer must pay an application fee with the quarterly
 return of three hundred dollars for each retail  place  of  business  in
 this  state  through  which  it  sells  cigarettes,  CIGARS  or  tobacco
 products.
 (iii) Every person who owns or, if the owner is not the operator, then
 any person who operates one or more vending machines through which ciga
 rettes, CIGARS or tobacco products are sold in this state, regardless of
 whether located on the premises of the vending machine owner or, if  the
 owner  is  not  the  operator,  then the premises of the operator or the
 premises of any other person, must pay an application fee with the quar
 terly return of one  hundred  dollars  for  each  vending  machine.  The
 department  will  issue a registration certificate, as prescribed by the
 commissioner, after receipt of a registration application and the appro
 priate registration fee, prior to the next succeeding January first.
 (b) Every retail dealer and every person who owns or, if the owner  is
 not  the  operator,  then  any  person  who operates one or more vending
 machines through which cigarettes, CIGARS or tobacco products  are  sold
 in  this  state  who  commences  business after the last day of August[,
 nineteen hundred ninety,] or who commences selling cigarettes, CIGARS or
 tobacco products at retail through a new or different place of  business
 in  this  state  after  such  date, or who commences selling cigarettes,
 CIGARS or tobacco products through new  or  different  vending  machines
 after  such  date,  must  file  with the commissioner an application for
 registration, in a form prescribed by him or her, at least  thirty  days
 prior  to commencing business or commencing sales. Each application must
 be accompanied by an application fee of three hundred dollars  for  each
 retail  place  of  business  and  one  hundred  dollars for each vending
 machine to be registered. The department, within ten days after  receipt
 of  an  application for registration under this paragraph and payment of
 the proper fee for application for registration, will issue a  registra
 tion  certificate,  as  prescribed  by the commissioner, for each retail
 place of business  or  cigarette,  CIGAR  or  tobacco  products  vending
 machine registered.
 

S  32. Paragraph (d) of subdivision 2 of section 480-a of the tax law,
 as amended by chapter 760 of the laws of 1992, is  amended  to  read  as
 follows:

 (d)  Except  as otherwise provided in this section, all the provisions
 of article twenty-eight of this chapter relating to the personal liabil
 ity for the tax, administration, collection and  determination  of  tax,
 and deposit and disposition of revenue, including section eleven hundred
 thirty-eight  of  this  chapter  relating  to  determination  of tax and
 section eleven hundred forty-five of this chapter (but  only  paragraphs
 one  and  two  of subdivision (a) of such section) relating to penalties
 
       S. 6259--B                         21                         A. 9059--B
 and interest for failure to file a return or pay  tax  within  the  time
 required,  shall apply to the applications for registration and the fees
 for filing such applications required by this section  and  the  penalty
 imposed pursuant to subdivision three of this section, as if such appli
 cations were returns required under section eleven hundred thirty-six of
 this  chapter  and  such  filing fees, penalties and interest were taxes
 required to be paid pursuant to such article twenty-eight, in  the  same
 manner  and  with  the  same force and effect as if the language of such
 provisions of such article twenty-eight had been  incorporated  in  full
 into  this  article,  except  to  the  extent that any such provision is
 either inconsistent with a provision of this section or is not  relevant
 thereto  and  with such other modifications as may be necessary to adapt
 the language of such provisions  to  the  provisions  of  this  section.
 [Section]  ANY REFERENCE TO A CERTIFICATE OF AUTHORITY SHOULD BE READ TO
 MEAN A CERTIFICATE OF REGISTRATION FOR  THE  PURPOSE  OF  THIS  SECTION.
 PARAGRAPHS  ONE  THROUGH THREE OF SUBDIVISION A AND SUBDIVISIONS B AND C
 OF SECTION eleven hundred thirty-four  of  [such  article  twenty-eight]
 THIS  CHAPTER  shall  not  apply to this section AS WELL AS ANY LANGUAGE
 CONTAINED IN SUCH SECTION REFERRING TO AN OFFICER, DIRECTOR, PARTNER  OR
 EMPLOYEE  OF  SUCH PERSON, AND, WHERE SUCH PERSON IS A LIMITED LIABILITY
 COMPANY, ALSO A MEMBER OR MANAGER OF  SUCH  PERSON,  IN  THE  OFFICER'S,
 DIRECTOR'S,  PARTNER'S,  MEMBER'S, MANAGER'S OR EMPLOYEE'S CAPACITY AS A
 PERSON REQUIRED TO COLLECT TAX ON  BEHALF  OF  SUCH  PERSON  OR  ANOTHER
 PERSON.    Provided,  however,  that  the  commissioner [of taxation and
 finance] shall refund or credit an application fee paid with respect  to
 the  registration  of a vending machine or a retail place of business in
 this state through which cigarettes, CIGARS or tobacco products were  to
 be  sold if, prior to the beginning of the calendar year with respect to
 which  such  registration  relates,  the  certificate  of   registration
 described  in  paragraph  (a)  of  this  subdivision  is returned to the
 department [of taxation and finance], or if such  certificate  has  been
 destroyed,  the retail dealer or vending machine operator satisfactorily
 accounts to the commissioner for the missing certificate, but such vend
 ing machine or retail place of business may not be used  to  sell  ciga
 rettes,  CIGARS  or  tobacco products in this state during such calendar
 year, unless it is  re-registered.  The  provisions  of  section  eleven
 hundred  thirty-nine of this chapter shall apply to the refund or credit
 authorized by the preceding sentence and for such purposes, such  refund
 or credit shall be deemed a refund of tax paid in error provided, howev
 er, no interest shall be allowed or paid on any such refund.
 

S  33. Paragraph (b) of subdivision 3 of section 480-a of the tax law,
 as amended by section 125-a of part C of chapter 58 of the laws of 2009,
 is amended to read as follows:

 (b) Any person who owns or, if the owner is not the operator, then any
 person who operates one or more vending  machines  through  which  ciga
 rettes,  CIGARS  or  tobacco  products  are  sold  in this state and who
 violates the provisions of this section, after due notice and an  oppor
 tunity  for  a hearing, for a first violation is liable for a civil fine
 not less than seven hundred fifty dollars but not to exceed two thousand
 dollars and for a second or  subsequent  violation  within  three  years
 following  a  prior  finding of violation be liable for a civil fine not
 less than two thousand dollars but not to exceed six thousand dollars.
 

S 34. Clause (B) of subparagraph (i) of paragraph (a) of subdivision 1
 of section 481 of the tax law, as amended by chapter 61 of the  laws  of
 1989, is amended to read as follows:

 
       S. 6259--B                         22                         A. 9059--B
 (B)  If  a tax on cigarettes, CIGARS or on tobacco products under this
 article is not paid when due by any other person, the person liable  for
 the  payment  of  such  tax  shall  be subject to a penalty of fifty per
 centum of the amount of such tax determined to be  due  as  provided  in
 this  article plus one per centum of such amount for each month or frac
 tion thereof during which such failure to pay continues after the  expi
 ration of the first month after such tax became due.
 

S  35.  Subparagraph  (i) of paragraph (b) of subdivision 1 of section
 481 of the tax law, as amended by chapter 604 of the laws  of  2008,  is
 amended to read as follows:

 (i)  In  addition  to  any  other penalty imposed by this article, the
 commissioner may (A) impose a penalty of not more than one hundred fifty
 dollars for each two hundred cigarettes, or fraction thereof, in  excess
 of  one  thousand cigarettes in unstamped or unlawfully stamped packages
 in the possession or under the control of any person  or  (B)  impose  a
 penalty  of  not  more  than  two hundred dollars for each ten unaffixed
 false,  altered  or  counterfeit  cigarette  tax  stamps,  imprints   or
 impressions, or fraction thereof, in the possession or under the control
 of any person. In addition, the commissioner may impose a penalty of not
 more  than  seventy-five  dollars  for each fifty cigars or one pound of
 tobacco, or fraction thereof, in excess of [two hundred] fifty cigars or
 five pounds of tobacco in the possession or under  the  control  of  any
 person and a penalty of not more than one hundred fifty dollars for each
 fifty cigars or pound of tobacco, or fraction thereof, in excess of five
 hundred  cigars  or ten pounds of tobacco in the possession or under the
 control of any person, with  respect  to  which  the  CIGAR  OR  tobacco
 products  tax  has not been paid or assumed by a distributor or CIGAR OR
 tobacco products  dealer;  provided,  however,  that  any  such  penalty
 imposed  shall  not  exceed  seven  thousand five hundred dollars in the
 aggregate. The commissioner may impose a penalty of not more than seven
 ty-five dollars for each fifty cigars or one pound of tobacco, or  frac
 tion  thereof,  in excess of fifty cigars or one pound of tobacco in the
 possession or under the control of any CIGAR OR tobacco products  dealer
 or  distributor appointed by the commissioner, and a penalty of not more
 than one hundred fifty dollars for each fifty cigars or pound of  tobac
 co, or fraction thereof, in excess of [two hundred] fifty cigars or five
 pounds  of  tobacco  in  the possession or under the control of any such
 dealer or distributor, with  respect  to  which  the  CIGAR  OR  tobacco
 products tax has not been paid or assumed by a distributor or a CIGAR OR
 tobacco  products  dealer;  provided,  however,  that  any  such penalty
 imposed shall not exceed fifteen thousand dollars in the aggregate.
 

S 36. Clauses (B) and (C) of subparagraph (ii)  of  paragraph  (b)  of
 subdivision  1 of section 481 of the tax law, as added by chapter 262 of
 the laws of 2000, are amended to read as follows:

 (B)(I) not less than twenty-five dollars but not more than one hundred
 dollars for each fifty cigars or one pound of tobacco, or fraction ther
 eof, in excess of [two hundred] fifty cigars or five pounds  of  tobacco
 knowingly  in  the  possession  or  knowingly  under  the control of any
 person, with respect to which the CIGAR OR tobacco products tax has  not
 been paid or assumed by a distributor or CIGAR OR tobacco products deal
 er; and
 (II) not less than fifty dollars but not more than two hundred dollars
 for  each  fifty  cigars  or  pound  of tobacco, or fraction thereof, in
 excess of [five] ONE hundred cigars or ten pounds of  tobacco  knowingly
 in  the  possession  or  knowingly under the control of any person, with
 respect to which the CIGAR OR tobacco products tax has not been paid  or
 
       S. 6259--B                         23                         A. 9059--B
 assumed  by a distributor or CIGAR OR tobacco products dealer; provided,
 however, that any such penalty  imposed  under  this  clause  shall  not
 exceed ten thousand dollars in the aggregate.
 (C)(I) not less than twenty-five dollars but not more than one hundred
 dollars for each fifty cigars or one pound of tobacco, or fraction ther
 eof,  in excess of fifty cigars or one pound of tobacco knowingly in the
 possession or knowingly under the control of any person, with respect to
 which the CIGAR OR tobacco products tax has not been paid or assumed  by
 a distributor or CIGAR OR tobacco products dealer; and
 (II) not less than fifty dollars but not more than two hundred dollars
 for  each  fifty  cigars  or  pound  of tobacco, or fraction thereof, in
 excess of [two hundred fifty] ONE  HUNDRED  cigars  or  five  pounds  of
 tobacco  knowingly  in  the possession or knowingly under the control of
 any person, with respect to which the CIGAR OR tobacco products tax  has
 not been paid or assumed by a distributor or a CIGAR OR tobacco products
 dealer;  provided,  however,  that  any  such penalty imposed under this
 clause shall not exceed twenty thousand dollars in the aggregate.
 

S 37. Subdivision 2 of section 481 of the tax law, as amended by chap
 ter 61 of the laws of 1989 and paragraph (a) as amended by  chapter  552
 of the laws of 2008, is amended to read as follows:

 2.  (a)  The  possession  within  this state of more than four hundred
 cigarettes in unstamped or unlawfully stamped  packages,  or  more  than
 [two  hundred]  fifty  cigars, or more than five pounds of tobacco other
 than roll-your-own tobacco, or more than thirty-six ounces of roll-your
 own tobacco by any person other than an agent  or  distributor,  as  the
 case  may  be,  at  any one time shall be presumptive evidence that such
 cigarettes, CIGARS or tobacco products are subject to tax as provided by
 this article.
 (b) Nothing in this section shall apply to common or contract carriers
 or warehousemen  while  engaged  in  lawfully  transporting  or  storing
 CIGARS, tobacco products or unstamped packages of cigarettes as merchan
 dise,  nor to any employee of such carrier or warehouseman acting within
 the scope of his OR HER employment, nor to public officers or  employees
 in  the  performance  of  their  official duties requiring possession or
 control of CIGARS, tobacco products or unstamped or  unlawfully  stamped
 packages  of  cigarettes,  nor  to  temporary  incidental  possession by
 employees or agents of persons lawfully entitled to possession,  nor  to
 persons whose possession is for the purpose of aiding police officers in
 performing their duties.
 

S  38.  The  tax law is amended by adding new section 481-a to read as
 follows:

 

S 481-A. PENALTIES AND INTEREST FOR RETAIL DEALERS. (A)  (1)  (I)  ANY
 PERSON  FAILING  TO  FILE  A RETURN OR TO PAY OR PAY OVER ANY TAX TO THE
 COMMISSIONER WITHIN THE TIME REQUIRED BY OR  PURSUANT  TO  THIS  ARTICLE
 (DETERMINED  WITH  REGARD TO ANY EXTENSION OF TIME FOR FILING OR PAYING)
 SHALL BE SUBJECT TO A PENALTY OF TEN PERCENT OF THE AMOUNT OF TAX DUE IF
 SUCH FAILURE IS FOR NOT MORE THAN ONE  MONTH,  WITH  AN  ADDITIONAL  ONE
 PERCENT  FOR EACH ADDITIONAL MONTH OR FRACTION THEREOF DURING WHICH SUCH
 FAILURE CONTINUES,  NOT  EXCEEDING  THIRTY  PERCENT  IN  THE  AGGREGATE.
 PROVIDED,  HOWEVER,  IN THE CASE OF A FAILURE TO FILE SUCH RETURN WITHIN
 SIXTY DAYS OF THE DATE PRESCRIBED FOR FILING OF SUCH RETURN BY OR PURSU
 ANT TO THIS ARTICLE (DETERMINED WITH REGARD TO ANY EXTENSION OF TIME FOR
 FILING), THE PENALTY IMPOSED BY THIS SUBPARAGRAPH SHALL NOT BE LESS THAN
 THE LESSER OF ONE HUNDRED DOLLARS OR ONE HUNDRED PERCENT OF  THE  AMOUNT
 REQUIRED  TO  BE  SHOWN  AS  TAX  ON SUCH RETURN. FOR THE PURPOSE OF THE
 PRECEDING SENTENCE, THE AMOUNT OF TAX REQUIRED TO BE SHOWN ON THE RETURN
 
       S. 6259--B                         24                         A. 9059--B
 SHALL BE REDUCED BY THE AMOUNT OF ANY PART OF THE TAX WHICH IS  PAID  ON
 OR  BEFORE  THE DATE PRESCRIBED FOR PAYMENT OF THE TAX AND BY THE AMOUNT
 OF ANY CREDIT AGAINST THE TAX WHICH MAY BE CLAIMED UPON THE  RETURN.  IN
 THE  CASE OF A FAILURE TO FILE A RETURN BY A PERSON REQUIRED TO REGISTER
 WITH THE COMMISSIONER AS PROVIDED IN SECTION FOUR  HUNDRED  EIGHTY-A  OF
 THIS ARTICLE, IN NO EVENT SHALL THE PENALTY FOR FAILURE TO FILE A RETURN
 BE LESS THAN ONE HUNDRED FIFTY DOLLARS.
 (II)  IF  ANY  AMOUNT  OF  TAX  IS NOT PAID ON OR BEFORE THE LAST DATE
 PRESCRIBED IN THIS ARTICLE FOR PAYMENT, INTEREST ON SUCH AMOUNT  AT  THE
 RATE  OF  FOURTEEN AND ONE-HALF PERCENT PER ANNUM OR AT THE UNDERPAYMENT
 RATE SET BY THE COMMISSIONER PURSUANT  TO  SUBDIVISION  TWENTY-SIXTH  OF
 SECTION  ONE  HUNDRED SEVENTY-ONE OF THIS CHAPTER, WHICHEVER IS GREATER,
 SHALL BE PAID FOR THE PERIOD FROM SUCH  LAST  DATE  TO  THE  DATE  PAID,
 WHETHER  OR  NOT ANY EXTENSION OF TIME FOR PAYMENT WAS GRANTED. INTEREST
 UNDER THIS SUBPARAGRAPH SHALL NOT BE PAID IF THE AMOUNT THEREOF IS  LESS
 THAN ONE DOLLAR.
 (III)  IF  THE  COMMISSIONER DETERMINES THAT SUCH FAILURE OR DELAY WAS
 DUE TO REASONABLE CAUSE AND NOT DUE TO WILLFUL NEGLECT, HE  OR  SHE  MAY
 REMIT ALL OF SUCH PENALTY AND THAT PORTION OF SUCH INTEREST THAT EXCEEDS
 THE INTEREST THAT WOULD BE PAYABLE IF SUCH INTEREST WERE COMPUTED AT THE
 UNDERPAYMENT  RATE SET BY THE COMMISSIONER PURSUANT TO SUBDIVISION TWEN
 TY-SIXTH OF SECTION ONE HUNDRED SEVENTY-ONE OF THIS CHAPTER. THE COMMIS
 SIONER MAY PROMULGATE RULES  AND  REGULATIONS  AS  TO  WHAT  CONSTITUTES
 REASONABLE CAUSE.
 (IV)  ANY  PERSON REQUIRED BY THIS ARTICLE TO FILE A RETURN, WHO OMITS
 FROM THE TOTAL AMOUNT OF CIGAR EXCISE TAX REQUIRED  TO  BE  SHOWN  ON  A
 RETURN AN AMOUNT WHICH IS IN EXCESS OF TWENTY-FIVE PERCENT OF THE AMOUNT
 OF  SUCH  TAXES REQUIRED TO BE SHOWN ON THE RETURN SHALL BE SUBJECT TO A
 PENALTY EQUAL TO TEN PERCENT OF THE AMOUNT  OF  SUCH  OMISSION.  IF  THE
 COMMISSIONER  DETERMINES  THAT SUCH OMISSION WAS DUE TO REASONABLE CAUSE
 AND NOT DUE TO WILLFUL NEGLECT, HE OR SHE MAY REMIT ALL OF SUCH PENALTY.
 (V) ANY PERSON REQUIRED TO COLLECT TAX WHO SELLS CIGARS AT RETAIL  AND
 WHO  SHALL  WILLFULLY  AND  KNOWINGLY  HAVE  IN SUCH PERSON'S CUSTODY OR
 POSSESSION OR UNDER SUCH PERSON'S CONTROL ANY CIGARS ON  WHICH  (A)  THE
 PREPAID  TAX IMPOSED BY SECTION FOUR HUNDRED SEVENTY-ONE-H OF THIS ARTI
 CLE HAS NOT BEEN ASSUMED OR PAID BY A DISTRIBUTOR LICENSED AS SUCH UNDER
 THIS ARTICLE, OR (B) THE  PREPAID  TAX  IMPOSED  BY  SUCH  SECTION  FOUR
 HUNDRED  SEVENTY-ONE-H  OF THIS ARTICLE WAS REQUIRED TO HAVE BEEN PASSED
 THROUGH TO SUCH PERSON AND HAS NOT BEEN INCLUDED IN  THE  COST  OF  SUCH
 CIGARS  TO  SUCH  PERSON, SHALL BE LIABLE FOR A PENALTY IN THE AMOUNT OF
 TWICE THE TAX NOT SO ASSUMED OR PAID, OR INCLUDED.   SUCH PENALTY  SHALL
 BE  DETERMINED, ASSESSED, COLLECTED AND PAID IN THE SAME MANNER AS TAXES
 IMPOSED BY THIS ARTICLE AND ALL THE PROVISIONS OF THIS ARTICLE  RELATING
 THERETO  SHALL  BE  DEEMED  ALSO TO REFER TO THE PENALTY IMPOSED BY THIS
 SUBPARAGRAPH. SUCH PENALTY MAY BE DETERMINED AT ANY  TIME  WITHIN  THREE
 YEARS  AFTER  SUCH  CIGARS SHALL HAVE COME INTO SUCH PERSON'S CUSTODY OR
 POSSESSION OR UNDER SUCH PERSON'S CONTROL. FOR PURPOSES OF THIS SUBPARA
 GRAPH, SUCH PERSON SHALL WILLFULLY AND KNOWINGLY HAVE IN  SUCH  PERSON'S
 CUSTODY  OR POSSESSION OR UNDER SUCH PERSON'S CONTROL ANY CIGAR ON WHICH
 (A) SUCH TAX HAS NOT BEEN ASSUMED OR PAID BY A DISTRIBUTOR  LICENSED  AS
 SUCH  UNDER  THIS  ARTICLE,  OR  (B)  SUCH TAX WAS REQUIRED TO HAVE BEEN
 PASSED THROUGH TO SUCH PERSON AND HAS NOT BEEN INCLUDED IN THE  COST  OF
 SUCH  CIGARS  TO  SUCH  PERSON,  WHERE  SUCH PERSON HAS KNOWLEDGE OF THE
 REQUIREMENT THAT SUCH TAXES BE PAID OR ASSUMED OR SO INCLUDED AND WHERE,
 TO SUCH PERSON'S KNOWLEDGE, SUCH TAXES HAVE NOT BEEN SO PAID OR  ASSUMED
 OR  SO INCLUDED. FOR PURPOSES OF THIS SUBPARAGRAPH, IT SHALL BE PRESUMP
 
       S. 6259--B                         25                         A. 9059--B
 TIVE EVIDENCE THAT SUCH PERSON SHALL WILLFULLY  AND  KNOWINGLY  HAVE  IN
 SUCH  PERSON'S  CUSTODY  OR  POSSESSION  OR  UNDER SUCH PERSON'S CONTROL
 CIGARS ON WHICH (A) SUCH TAX HAS NOT BEEN ASSUMED OR PAID BY A DISTRIBU
 TOR  AUTHORIZED  AS SUCH UNDER THIS ARTICLE OR (B) SUCH TAX WAS REQUIRED
 TO HAVE BEEN PASSED THROUGH TO SUCH PERSON AND HAS NOT BEEN INCLUDED  IN
 THE  COST  OF  SUCH  CIGARS  TO  SUCH  PERSON  WHERE SUCH PERSON HAS NOT
 RECEIVED  THE   CERTIFICATION   REQUIRED   BY   SECTION   FOUR   HUNDRED
 SEVENTY-ONE-K OF THIS ARTICLE AT THE TIME OF DELIVERY OF SUCH CIGARS OR,
 IN  THOSE CIRCUMSTANCES WHERE THE COMMISSIONER HAS AUTHORIZED THE DELIV
 ERY OF SUCH CERTIFICATION AT A TIME AFTER DELIVERY OF THE CIGARS, AT THE
 TIME PRESCRIBED BY THE COMMISSIONER.
 (2) IF THE FAILURE TO PAY OR PAY OVER  ANY  TAX  TO  THE  COMMISSIONER
 WITHIN THE TIME REQUIRED BY THIS ARTICLE IS DUE TO FRAUD, IN LIEU OF THE
 PENALTIES  AND  INTEREST  PROVIDED  FOR IN SUBPARAGRAPHS (I) AND (II) OF
 PARAGRAPH ONE OF THIS SUBDIVISION, THERE SHALL BE ADDED TO THE TAX (I) A
 PENALTY OF TWO TIMES THE AMOUNT OF THE TAX DUE, PLUS  (II)  INTEREST  ON
 SUCH  UNPAID  TAX AT THE RATE OF FOURTEEN AND ONE-HALF PERCENT PER ANNUM
 OR THE UNDERPAYMENT RATE OF INTEREST SET BY THE COMMISSIONER PURSUANT TO
 SUBDIVISION TWENTY-SIXTH OF SECTION  ONE  HUNDRED  SEVENTY-ONE  OF  THIS
 CHAPTER,  WHICHEVER IS GREATER, FOR THE PERIOD BEGINNING ON THE LAST DAY
 PRESCRIBED BY THIS ARTICLE FOR THE PAYMENT OF SUCH TAX (DETERMINED WITH
 OUT REGARD TO ANY EXTENSION OF TIME FOR PAYING) AND ENDING ON THE DAY ON
 WHICH SUCH TAX IS PAID.
 (3) (I) ANY PERSON REQUIRED TO OBTAIN A  CERTIFICATE  OF  REGISTRATION
 UNDER  SECTION  FOUR  HUNDRED  EIGHTY-A  OF  THIS  ARTICLE  WHO, WITHOUT
 POSSESSING A VALID CERTIFICATE OF REGISTRATION, SELLS CIGARETTES, CIGARS
 AND TOBACCO PRODUCTS SHALL, IN ADDITION TO ANY OTHER PENALTY IMPOSED  BY
 THIS  CHAPTER,  BE  SUBJECT TO A PENALTY IN AN AMOUNT NOT EXCEEDING FIVE
 HUNDRED DOLLARS FOR THE FIRST DAY ON WHICH SUCH SALES OR  PURCHASES  ARE
 MADE,  PLUS  AN AMOUNT NOT EXCEEDING TWO HUNDRED DOLLARS FOR EACH SUBSE
 QUENT DAY ON WHICH SUCH SALES OR PURCHASES ARE MADE, NOT TO  EXCEED  TEN
 THOUSAND DOLLARS IN THE AGGREGATE.
 (II)  IF THE COMMISSIONER DETERMINES THAT ANY FAILURE OR ACT DESCRIBED
 IN THIS PARAGRAPH WAS DUE TO REASONABLE CAUSE AND  NOT  DUE  TO  WILLFUL
 NEGLECT, HE OR SHE MAY REMIT ALL OR PART OF SUCH PENALTY.
 (4)  ANY  PERSON  REQUIRED BY THIS ARTICLE TO DISPLAY A CERTIFICATE OF
 REGISTRATION, WHO FAILS  TO  DISPLAY  SUCH  CERTIFICATE  IN  THE  MANNER
 REQUIRED  BY  THIS  ARTICLE  OR  ANY  RULE  OR REGULATION ADOPTED BY THE
 COMMISSIONER IN CONNECTION WITH SUCH REQUIREMENT SHALL, IN  ADDITION  TO
 ANY  OTHER  PENALTY  IMPOSED BY THIS CHAPTER, BE SUBJECT TO A PENALTY OF
 FIFTY DOLLARS. IF THE COMMISSIONER DETERMINES THAT SUCH FAILURE WAS  DUE
 TO  REASONABLE CAUSE AND NOT DUE TO WILLFUL NEGLECT, HE OR SHE MAY REMIT
 ALL OR PART OF SUCH PENALTY.
 (5) THE PENALTIES AND INTEREST PROVIDED FOR IN THIS SUBDIVISION  SHALL
 BE  PAID  AND DISPOSED OF IN THE SAME MANNER AS OTHER REVENUES FROM THIS
 ARTICLE. SUCH  PENALTIES  AND  INTEREST  MAY  BE  DETERMINED,  ASSESSED,
 COLLECTED  AND  ENFORCED  IN  THE SAME MANNER AS THE TAX IMPOSED BY THIS
 ARTICLE.  INTEREST UNDER THIS SUBDIVISION SHALL BE COMPOUNDED DAILY.
 (B) CROSS-REFERENCE: FOR CRIMINAL PENALTIES, SEE ARTICLE  THIRTY-SEVEN
 OF THIS CHAPTER.
 (C)  ANY PERSON FAILING TO FILE A RETURN OR TO PAY ANY TAX REQUIRED TO
 BE PREPAID TO THE COMMISSIONER WITH RESPECT TO CIGARS  PURSUANT  TO  THE
 PROVISIONS  OF SECTION FOUR HUNDRED SEVENTY-ONE-H OF THIS ARTICLE WITHIN
 THE TIME REQUIRED BY THIS ARTICLE SHALL, IN ADDITION TO ANY OTHER PENAL
 TY PROVIDED IN THIS ARTICLE OR OTHERWISE IMPOSED BY LAW, BE SUBJECT TO A
 PENALTY EQUAL TO THE AMOUNT OF TAX REQUIRED TO BE SO PREPAID PURSUANT TO
 
       S. 6259--B                         26                         A. 9059--B
 THE PROVISIONS OF SUCH SECTION FOUR HUNDRED SEVENTY-ONE-H OF THIS  ARTI
 CLE.   IF THE COMMISSIONER DETERMINES THAT SUCH FAILURE TO FILE A RETURN
 OR TO PAY ANY SUCH TAX WAS DUE TO REASONABLE CAUSE AND NOT DUE TO  WILL
 FUL NEGLECT, HE OR SHE MAY REMIT ALL OR ANY PART OF SUCH PENALTY.
 (D)  THE  CERTIFICATE OF THE COMMISSIONER TO THE EFFECT THAT A TAX HAS
 NOT BEEN PAID, THAT A RETURN, BOND OR REGISTRATION CERTIFICATE  HAS  NOT
 BEEN  FILED,  OR  THAT INFORMATION HAS NOT BEEN SUPPLIED PURSUANT TO THE
 PROVISIONS OF THIS ARTICLE SHALL BE PRESUMPTIVE EVIDENCE THEREOF.
 (E) ANY PERSON REQUIRED TO MAKE OR MAINTAIN RECORDS UNDER THIS ARTICLE
 WHO FAILS TO MAKE OR MAINTAIN OR  MAKE  AVAILABLE  TO  THE  COMMISSIONER
 THESE RECORDS IS SUBJECT TO A PENALTY NOT TO EXCEED ONE THOUSAND DOLLARS
 FOR  THE  FIRST  PERIOD OR PART THEREOF FOR WHICH THE FAILURE OCCURS AND
 NOT TO EXCEED FIVE THOUSAND DOLLARS FOR EACH ADDITIONAL PERIOD  OR  PART
 THEREOF FOR WHICH THE FAILURE OCCURS. THIS PENALTY IS IN ADDITION TO ANY
 OTHER  PENALTY  PROVIDED  FOR IN THIS ARTICLE BUT MAY NOT BE IMPOSED AND
 COLLECTED MORE THAN ONCE FOR FAILURES FOR THE SAME PERIOD OR PART THERE
 OF. IF THE COMMISSIONER DETERMINES THAT A FAILURE TO MAKE OR MAINTAIN OR
 MAKE AVAILABLE RECORDS IN ANY PERIOD  WAS  ENTIRELY  DUE  TO  REASONABLE
 CAUSE AND NOT TO WILLFUL NEGLECT, THE COMMISSIONER MUST REMIT THE PENAL
 TY IMPOSED FOR THAT PERIOD. THESE PENALTIES WILL BE PAID AND DISPOSED OF
 IN  THE SAME MANNER AS OTHER REVENUES FROM THIS ARTICLE. THESE PENALTIES
 WILL BE DETERMINED, ASSESSED, COLLECTED, PAID AND ENFORCED IN  THE  SAME
 MANNER  AS  THE  TAX  IMPOSED BY THIS ARTICLE, AND ALL THE PROVISIONS OF
 THIS ARTICLE RELATING TO TAX WILL BE DEEMED ALSO TO APPLY TO THE  PENAL
 TIES IMPOSED BY THIS SUBDIVISION. FOR PURPOSES OF THE PENALTY IMPOSED BY
 THIS  SUBDIVISION, A PERSON WILL BE CONSIDERED TO HAVE FAILED TO MAKE OR
 MAINTAIN THE REQUIRED RECORDS WHEN THE RECORDS  MADE  OR  MAINTAINED  BY
 THAT  PERSON  FOR  A PERIOD MAKE IT VIRTUALLY IMPOSSIBLE TO VERIFY SALES
 RECEIPTS AND TO CONDUCT A COMPLETE AUDIT.
 (F) FALSE OR FRAUDULENT DOCUMENT PENALTY. ANY TAXPAYER THAT SUBMITS  A
 FALSE  OR  FRAUDULENT  DOCUMENT  TO  THE DEPARTMENT WILL BE SUBJECT TO A
 PENALTY OF ONE HUNDRED DOLLARS PER DOCUMENT SUBMITTED, OR  FIVE  HUNDRED
 DOLLARS  PER  TAX  RETURN SUBMITTED. THIS PENALTY WILL BE IN ADDITION TO
 ANY OTHER PENALTY PROVIDED BY LAW.
 (G) AIDING OR ASSISTING IN THE GIVING OF FRAUDULENT RETURNS,  REPORTS,
 STATEMENTS  OR OTHER DOCUMENTS. ANY PERSON WHO, WITH THE INTENT THAT TAX
 BE EVADED, FOR A FEE OR OTHER COMPENSATION OR  AS  AN  INCIDENT  TO  THE
 PERFORMANCE  OF  OTHER  SERVICES  FOR WHICH THAT PERSON RECEIVES COMPEN
 SATION, AIDS OR ASSISTS IN, OR PROCURES, COUNSELS, OR ADVISES THE PREPA
 RATION OR PRESENTATION UNDER THIS ARTICLE, OR  IN  CONNECTION  WITH  ANY
 MATTER  ARISING  UNDER THIS ARTICLE, OF ANY RETURN, REPORT, DECLARATION,
 STATEMENT OR OTHER DOCUMENT THAT IS FRAUDULENT OR FALSE AS TO ANY  MATE
 RIAL MATTER, OR SUPPLIES ANY FALSE OR FRAUDULENT INFORMATION, WHETHER OR
 NOT SUCH FALSITY OR FRAUD IS WITH THE KNOWLEDGE OR CONSENT OF THE PERSON
 AUTHORIZED  OR  REQUIRED  TO  PRESENT  THAT RETURN, REPORT, DECLARATION,
 STATEMENT OR OTHER DOCUMENT, WILL PAY A PENALTY NOT EXCEEDING FIVE THOU
 SAND DOLLARS.
 (H) ANY PERSON WHO, HAVING ELECTED TO MAINTAIN IN AN ELECTRONIC FORMAT
 ANY PORTION OR ALL OF THE RECORDS HE OR SHE  IS  REQUIRED  TO  MAKE  AND
 MAINTAIN BY THIS ARTICLE, FAILS TO PRESENT AND MAKE THESE RECORDS AVAIL
 ABLE AND ACCESSIBLE TO THE COMMISSIONER IN ELECTRONIC FORMAT, IS SUBJECT
 TO A PENALTY NOT TO EXCEED FIVE THOUSAND DOLLARS FOR EACH PERIOD OR PART
 THEREOF  FOR  WHICH  THESE ELECTRONIC RECORDS ARE NOT PRESENTED AND MADE
 AVAILABLE AND ACCESSIBLE UPON REQUEST, NOTWITHSTANDING THAT THE  RECORDS
 MAY  ALSO  BE MAINTAINED AND AVAILABLE IN HARD COPY FORMAT. THIS PENALTY
 IS IN ADDITION TO ANY OTHER PENALTY PROVIDED FOR IN  THIS  ARTICLE,  BUT
 
       S. 6259--B                         27                         A. 9059--B
 MAY  NOT  BE  IMPOSED AND COLLECTED MORE THAN ONCE FOR A FAILURE FOR THE
 SAME PERIOD OR PART THEREOF.  PROVIDED, HOWEVER, NOTHING IN THIS  SUBDI
 VISION  WILL  PREVENT  THE  SEPARATE  IMPOSITION,  IF APPLICABLE, OF ANY
 PENALTY  IMPOSED BY THIS SECTION FOR THE SAME PERIOD OR PART THEREOF. IF
 THE COMMISSIONER DETERMINES THAT THE FAILURE TO PRESENT AND  MAKE  ELEC
 TRONICALLY  MAINTAINED RECORDS AVAILABLE AND ACCESSIBLE FOR A PERIOD WAS
 ENTIRELY DUE TO REASONABLE CAUSE AND NOT TO WILLFUL NEGLECT, THE COMMIS
 SIONER MUST REMIT THE PENALTY IMPOSED FOR THAT PERIOD.  THESE  PENALTIES
 WILL  BE  PAID AND DISPOSED OF IN THE SAME MANNER AS OTHER REVENUES FROM
 THIS ARTICLE. THESE PENALTIES WILL BE DETERMINED,  ASSESSED,  COLLECTED,
 PAID AND ENFORCED IN THE SAME MANNER AS THE TAX IMPOSED BY THIS ARTICLE,
 AND  ALL  THE  PROVISIONS OF THIS ARTICLE RELATING TO TAX WILL BE DEEMED
 ALSO TO APPLY TO THE PENALTY IMPOSED BY THIS SUBDIVISION.  FOR  PURPOSES
 OF  THE  PENALTY  IMPOSED  BY THIS SUBDIVISION, A FAILURE TO PRESENT AND
 MAKE AVAILABLE AND ACCESSIBLE A RECORD MAINTAINED IN  ELECTRONIC  FORMAT
 INCLUDES  NOT  ONLY  THE  DENIAL OF ACCESS TO THE REQUESTED RECORDS THAT
 WERE MAINTAINED ELECTRONICALLY, BUT ALSO THE FAILURE TO  MAKE  AVAILABLE
 TO  THE  COMMISSIONER  THE INFORMATION, KNOWLEDGE, OR MEANS NECESSARY TO
 ACCESS AND OTHERWISE USE THE ELECTRONICALLY MAINTAINED  RECORDS  IN  THE
 INSPECTION AND EXAMINATION OF THESE RECORDS.
 

S  39.  Subdivision  (h) of section 1111 of the tax law, as amended by
 section 1 of part Q-3 of chapter 62 of the laws of 2003, is  amended  to
 read as follows:

 (h)  Receipts  subject  to tax under subdivision (a) of section eleven
 hundred five on retail sales of cigarettes, CIGARS and tobacco  products
 and consideration given or contracted to be given for cigarettes, CIGARS
 and  tobacco products the uses of which are subject to tax under section
 eleven hundred ten shall be deemed to include any tax imposed  on  ciga
 rettes,  CIGARS  and  tobacco products by article twenty of this chapter
 and any tax imposed on cigarettes AND  CIGARS  by  chapter  thirteen  of
 title eleven of the administrative code of the city of New York.
 

S  40.  Subdivision  (e) of section 1814 of the tax law, as amended by
 section 28 of subpart I of part V-1 of chapter 57 of the laws  of  2009,
 is amended to read as follows:

 (e) Nothing in this section shall apply to common or contract carriers
 or  warehousemen  while  engaged  in  lawfully  transporting  or storing
 unstamped packages of cigarettes as merchandise, or lawfully  transport
 ing  or  storing CIGARS OR tobacco products, nor to any employee of such
 carrier or warehouseman acting within the scope of his  OR  HER  employ
 ment,  nor  to  public officers or employees in the performance of their
 official duties requiring possession or control of unstamped  or  unlaw
 fully  stamped packages of cigarettes or possession or control of CIGARS
 OR tobacco products, nor to temporary incidental possession by employees
 or agents of persons lawfully entitled to  possession,  nor  to  persons
 whose  possession  is  for  the  purpose  of  aiding  police officers in
 performing their duties.
 

S 41. Paragraphs 3 and 4 of subdivision (h) of section 1814 of the tax
 law, as amended by section 28 of subpart I of part V-1 of chapter 57  of
 the laws of 2009, are amended to read as follows:

 (3) Any person, other than a distributor appointed by the commissioner
 under  article  twenty of this chapter, who shall knowingly transport or
 have in his OR HER custody, possession or under his OR HER control twen
 ty-five hundred or more cigars or fifty or more pounds of  tobacco  upon
 which  the taxes imposed by article twenty of this chapter have not been
 assumed or paid by a distributor appointed  by  the  commissioner  under
 article twenty of this chapter, or other person treated as a distributor
 
       S. 6259--B                         28                         A. 9059--B
 pursuant  to section four hundred seventy-one-d of this chapter shall be
 guilty of a misdemeanor. Provided further, that any person who has twice
 been convicted under this subdivision shall be guilty of a class E felo
 ny  for  any  subsequent  violation  of  this section, regardless of the
 amount of CIGARS OR tobacco products involved in such violation.
 (4) For purposes of this  subdivision,  such  person  shall  knowingly
 transport  or have in his OR HER custody, possession or under his OR HER
 control tobacco PRODUCTS or cigars on which such  taxes  have  not  been
 assumed  or  paid  by  a distributor appointed by the commissioner where
 such person has knowledge of the requirement of the tax  on  CIGARS  AND
 tobacco products and, where to his OR HER knowledge, such taxes have not
 been assumed or paid on such CIGARS OR tobacco products by a distributor
 appointed by the commissioner [of taxation and finance].
 

S  42. 

Section  1814-a  of the tax law, as added by chapter 61 of the
 laws of 1989, is amended to read as follows:

 

S 1814-a. Person not appointed as a [tobacco products] distributor  OF
 CIGARS OR TOBACCO PRODUCTS. (a) Any person who, while not appointed as a
 distributor  of CIGARS OR tobacco products pursuant to the provisions of
 article twenty of this chapter, imports or causes to  be  imported  into
 the  state more than fifty cigars or more than one pound of tobacco, for
 sale within the state, or produces, manufactures or compounds CIGARS  OR
 tobacco  products  within  the  state  shall  be guilty of a misdemeanor
 punishable by a fine of not more than five thousand dollars or by a term
 of imprisonment not to exceed thirty days. If,  within  any  ninety  day
 period,  one  thousand  or more cigars or five hundred pounds or more of
 tobacco are imported or caused to be imported into the  state  for  sale
 within  the state or are produced, manufactured or compounded within the
 state by any person while not appointed as a distributor  of  CIGARS  OR
 tobacco products, such person shall be guilty of a misdemeanor. Provided
 further, that any person who has twice been convicted under this section
 shall be guilty of a class E felony for any subsequent violation of this
 section, regardless of the amount of CIGARS OR tobacco products involved
 in such violation.
 (b)  For  purposes  of  this section, the possession or transportation
 within this state by any person, other than a CIGAR OR tobacco  products
 distributor  appointed by the commissioner [of taxation and finance], at
 any one time of seven hundred fifty or more cigars or fifteen pounds  or
 more of tobacco shall be presumptive evidence that such tobacco products
 are  possessed or transported for the purpose of sale and are subject to
 the tax imposed by section  four  hundred  seventy-one-b,  SECTION  FOUR
 HUNDRED  SEVENTY-ONE-F  OR  SECTION  FOUR  HUNDRED SEVENTY-ONE-H of this
 chapter.  With  respect  to  such  possession  or  transportation,   any
 provisions of article twenty of this chapter providing for a time period
 during  which  the  tax  imposed  by  such article may be paid shall not
 apply.
 

S 43. The section heading, subdivisions (a), (b) and  (c)  of  section
 1846-a  of  the  tax law, as amended by chapter 556 of the laws of 2011,
 are amended to read as follows:

 Forfeiture action with respect to CIGARS  AND  tobacco  products.  (a)
 Whenever  a  police  officer  designated in section 1.20 of the criminal
 procedure law or a peace  officer  designated  in  subdivision  four  of
 section  2.10 of such law, acting pursuant to his OR HER special duties,
 shall discover any tobacco products in excess of five hundred cigars  or
 ten  pounds  of  tobacco  which are being imported for sale in the state
 where the person importing or causing such CIGARS AND  tobacco  products
 to  be  imported  has  not  been  appointed as a distributor pursuant to
 
       S. 6259--B                         29                         A. 9059--B
 section four hundred seventy-two of this chapter, such police officer or
 peace officer is hereby authorized and empowered forthwith to seize  and
 take  possession  of  such  CIGARS AND tobacco products. Such CIGARS AND
 tobacco  products  seized  by a police officer or peace officer shall be
 turned over to the commissioner. Such seized CIGARS AND tobacco products
 shall be forfeited  to  the  state.  All  CIGARS  AND  tobacco  products
 forfeited  to  the  state shall be destroyed or used for law enforcement
 purposes, except that CIGARS OR tobacco products that  violate,  or  are
 suspected  of violating, federal trademark laws or import laws shall not
 be used for law enforcement purposes. If the commissioner determines the
 CIGARS OR tobacco products may not be used for law enforcement purposes,
 the commissioner must, within a reasonable time thereafter, upon  publi
 cation  in  the state registry of a notice to such effect before the day
 of destruction, destroy such forfeited CIGARS OR tobacco  products.  The
 commissioner  may,  prior  to  any  destruction  of  CIGARS  OR  tobacco
 products, permit the true holder of the trademark rights in  the  CIGARS
 OR  tobacco  products  to  inspect  such  forfeited products in order to
 assist in any investigation regarding such CIGARS OR tobacco products.
 (b) In the alternative, the commissioner, on reasonable notice by mail
 or otherwise, may permit the person from whom  said  CIGARS  OR  tobacco
 products  were  seized  to redeem the said CIGARS OR tobacco products by
 the payment of the tax due, plus a penalty of fifty per centum  thereof,
 plus interest on the amount of tax due for each month or fraction there
 of after such tax became due (determined without regard to any extension
 of  time for filing or paying) at the rate applicable under subparagraph
 (ii) of paragraph (a) of subdivision one of section four hundred  eight
 y-one  of  this chapter and the costs incurred in such proceeding, which
 total payment shall not be less than five  dollars;  provided,  however,
 that  such seizure and sale or redemption shall not be deemed to relieve
 any person from fine or imprisonment provided for in  this  article  for
 violation of any provision of article twenty of this chapter.
 (c)  In the alternative, the commissioner may dispose of any CIGARS OR
 tobacco products seized pursuant to  this  section,  except  those  that
 violate,  or  are  suspected  of  violating, federal trademark or import
 laws, by transferring them to the department of corrections and communi
 ty supervision for sale to or use by inmates in such institutions.
 

S 44. The section heading of section 1847 of the tax law,  as  amended
 by chapter 61 of the laws of 1989, is amended to read as follows:

 Seizure  and  forfeiture  of vehicles or other means of transportation
 used to transport or for deposit or concealment of cigarettes or used to
 import CIGARS OR tobacco products.
 

S 45. Subdivision (b) of section 1847 of the  tax  law,  as  added  by
 chapter 61 of the laws of 1989, is amended to read as follows:

 (b)  Any  peace officer designated in subdivision four of section 2.10
 of the criminal procedure law, acting pursuant to  his  OR  HER  special
 duties, or any police officer designated in section 1.20 of the criminal
 procedure  law  may  seize  any vehicle or other means of transportation
 used to import CIGARS OR tobacco products  in  excess  of  five  hundred
 cigars  or  ten pounds of tobacco for sale where the person importing or
 causing such CIGARS OR tobacco products to  be  imported  has  not  been
 appointed  a distributor pursuant to section four hundred seventy-two of
 this chapter, other than a vehicle or other means of transportation used
 by any person as a common carrier in transaction  of  business  as  such
 common  carrier, and such vehicle or other means of transportation shall
 be subject to forfeiture as hereinafter in this section provided.
 
       S. 6259--B                         30                         A. 9059--B
 

S 46. This act shall take effect July 1, 2012; provided, however, that
 section eleven of this act shall take effect immediately.
 PART D
 

Section  1.

Section 19 of part W-1 of chapter 109 of the laws of 2006,
 amending the tax law relating to  providing  exemptions,  reimbursements
 and credits from various taxes for certain alternative fuels, as amended
 by  section 2 of part L of chapter 61 of the laws of 2011, is amended to
 read as follows:

 

S 19. This act shall take effect immediately; provided, however,  that
 sections one through thirteen of this act shall take effect September 1,
 2006  and  shall be deemed repealed on September 1, [2012] 2017 and such
 repeal shall  apply  in  accordance  with  the  applicable  transitional
 provisions  of sections 1106 and 1217 of the tax law, and shall apply to
 sales made, fuel compounded or manufactured, and uses  occurring  on  or
 after  such  date,  and with respect to sections seven through eleven of
 this act, in  accordance  with  applicable  transitional  provisions  of
 sections  1106  and  1217  of  the  tax law; provided, however, that the
 commissioner of taxation and finance shall be authorized  on  and  after
 the  date  this act shall have become a law to adopt and amend any rules
 or regulations  and  to  take  any  steps  necessary  to  implement  the
 provisions  of this act; provided further that sections fourteen through
 sixteen of this act shall take effect immediately  and  shall  apply  to
 taxable years beginning on or after January 1, 2006.
 

S 2. This act shall take effect immediately.
 PART E
 

Section 1. Subdivision 14 of section 282 of the tax law, as amended by
 section  1  of  part  K of chapter 61 of the laws of 2011, is amended to
 read as follows:

 14. "Diesel motor fuel" shall mean No. 1 Diesel  fuel,  No.  2  Diesel
 fuel, biodiesel, kerosene, [crude oil,] fuel oil or other middle distil
 late  and also motor fuel suitable for use in the operation of an engine
 of the diesel type, excluding, however, any product specifically  desig
 nated  "No. 4 Diesel fuel" and not suitable as a fuel used in the opera
 tion of a motor vehicle engine.
 

S 2. Paragraph (b) of subdivision 3 of section 282-a of the  tax  law,
 as  amended by section 5 of part K of chapter 61 of the laws of 2011, is
 amended to read as follows:

 (b) The tax on the incidence of sale or use imposed by subdivision one
 of this section shall not apply to: (i) the sale or use  of  non-highway
 Diesel  motor  fuel, but only if all of such fuel is consumed other than
 on the public highways of this state (except for the use of  the  public
 highway by farmers to reach adjacent farmlands); provided, however, this
 exemption  shall in no event apply to a sale of non-highway Diesel motor
 fuel which involves a delivery at a filling station or into a repository
 which is equipped with a hose or other apparatus by which such fuel  can
 be  dispensed into the fuel tank of a motor vehicle (except for delivery
 at a farm site which qualifies for the exemption under  subdivision  (g)
 of  section  three hundred one-b of this chapter); or (ii) a sale to the
 consumer consisting of not more than twenty gallons of water-white kero
 sene to be used and consumed exclusively for heating purposes; or  (iii)
 the  sale  to or delivery at a filling station or other retail vendor of
 water-white kerosene provided  such  filling  station  or  other  retail
 
       S. 6259--B                         31                         A. 9059--B
 vendor  only  sells  such  water-white  kerosene exclusively for heating
 purposes in containers of no more than twenty gallons; or (iv) a sale of
 kero-jet fuel to an airline for use in its airplanes or a use  of  kero
 jet  fuel by an airline in its airplanes; or (v) a sale of kero-jet fuel
 by a registered distributor of Diesel motor fuel to a fixed base  opera
 tor registered under this article as a distributor of kero-jet fuel only
 where  such  fixed base operator is engaged solely in making or offering
 to make retail sales not in bulk of kero-jet fuel directly into the fuel
 tank of an airplane for the purpose of  operating  such  airplane;  [or]
 (vi) a retail sale not in bulk of kero-jet fuel by a fixed base operator
 registered  under  this  article  as a distributor of kero-jet fuel only
 where such fuel is delivered directly into the fuel tank of an  airplane
 for  use  in the operation of such airplane; OR (VII) THE SALE OF PREVI
 OUSLY UNTAXED QUALIFIED BIODIESEL TO  A  PERSON  REGISTERED  UNDER  THIS
 ARTICLE  AS  A  DISTRIBUTOR OF DIESEL MOTOR FUEL OTHER THAN (A) A RETAIL
 SALE TO SUCH PERSON OR (B) A SALE TO SUCH PERSON WHICH INVOLVES A DELIV
 ERY AT A FILLING STATION OR INTO A REPOSITORY WHICH IS EQUIPPED  WITH  A
 HOSE  OR  OTHER  APPARATUS  BY  WHICH  SUCH  QUALIFIED  BIODIESEL CAN BE
 DISPENSED INTO THE FUEL TANK OF A MOTOR VEHICLE.
 

S 3. Paragraph 5 of subdivision (a) of section 301-b of the  tax  law,
 as  added  by  chapter  190  of  the laws of 1990, is amended to read as
 follows:

 (5) [Crude oil and  liquefied]  LIQUIFIED  petroleum  gases,  such  as
 butane, ethane or propane.
 

S  4.  Subdivision  (e) of section 301-b of the tax law, as amended by
 section 21 of part K of chapter 61 of the laws of 2011,  is  amended  to
 read as follows:

 (e)  Sales  of  QUALIFIED BIODIESEL, non-highway diesel motor fuel and
 residual petroleum product to registered distributors  of  diesel  motor
 fuel and registered residual petroleum product businesses.
 (1)  [Non-highway]  QUALIFIED  BIODIESEL  AND NON-HIGHWAY Diesel motor
 fuel sold by a person registered under article twelve-A of this  chapter
 as  a distributor of diesel motor fuel to a person registered under such
 article twelve-A as a distributor of diesel motor fuel where  such  sale
 is  not  a  retail  sale or a sale that involves a delivery at a filling
 station or into a repository equipped with a hose or other apparatus  by
 which  such  QUALIFIED BIODIESEL OR non-highway Diesel motor fuel can be
 dispensed into the fuel tank of a motor vehicle.
 (2) Residual petroleum product sold by a person registered under  this
 article  as a residual petroleum product business to a person registered
 under this article as a residual petroleum product business  where  such
 sale  is not a retail sale. Provided, however, that the commissioner may
 require such documentary proof to qualify for any exemption provided  in
 this section as the commissioner deems appropriate, including the expan
 sion  of  any  certifications  required  pursuant to section two hundred
 eighty-five-a or two hundred eighty-five-b of this chapter to cover  the
 taxes imposed by this article.
 (3)  "QUALIFIED  BIODIESEL"  MEANS SUCH TERM AS DEFINED IN SUBDIVISION
 TWENTY-THREE OF SECTION TWO HUNDRED EIGHTY-TWO OF THIS CHAPTER.
 

S 5. Paragraph 2 of subdivision (a) of section 1102 of the tax law, as
 amended by section 39 of part K of chapter 61 of the laws  of  2011,  is
 amended to read as follows:

 (2)  Every distributor of diesel motor fuel shall pay, as a prepayment
 on account of the taxes imposed by this  article  and  pursuant  to  the
 authority of article twenty-nine of this chapter, a tax upon the sale or
 use  of diesel motor fuel in this state. The tax shall be computed based
 
       S. 6259--B                         32                         A. 9059--B
 upon the number of gallons of diesel motor fuel sold or used.  Provided,
 however,  if  the  tax  has  not been imposed prior thereto, it shall be
 imposed on the delivery  of  diesel  motor  fuel  to  a  retail  service
 station.  The collection of such tax shall not be made applicable to the
 sale or use of diesel motor fuel under circumstances which preclude  the
 collection  of  such tax by reason of the United States constitution and
 of laws of the United States enacted pursuant thereto. The  prepaid  tax
 on  diesel  motor  fuel  shall  not  apply to (i) the sale of previously
 untaxed non-highway Diesel motor  fuel  to  a  person  registered  as  a
 distributor  of Diesel motor fuel other than a sale to such person which
 involves a delivery at a filling station or into a repository  which  is
 equipped  with  a  hose  or  other  apparatus  by which such fuel can be
 dispensed into the fuel tank of a motor vehicle, [or] (ii) the  sale  to
 or  delivery  at a filling station or other retail vendor of water-white
 kerosene provided such filling station or other retail vendor only sells
 such water-white kerosene exclusively for heating purposes in containers
 of no more than twenty gallons or to the sale of  CNG  or  hydrogen;  OR
 (III)  THE  SALE  OF  PREVIOUSLY UNTAXED QUALIFIED BIODIESEL TO A PERSON
 REGISTERED UNDER ARTICLE TWELVE-A OF THIS CHAPTER AS  A  DISTRIBUTOR  OF
 DIESEL  MOTOR  FUEL OTHER THAN (A) A RETAIL SALE TO SUCH PERSON OR (B) A
 SALE TO SUCH PERSON WHICH INVOLVES A DELIVERY AT A  FILLING  STATION  OR
 INTO  A  REPOSITORY  WHICH IS EQUIPPED WITH A HOSE OR OTHER APPARATUS BY
 WHICH SUCH QUALIFIED BIODIESEL CAN BE DISPENSED INTO THE FUEL TANK OF  A
 MOTOR  VEHICLE.  "QUALIFIED  BIODIESEL"  MEANS  SUCH  TERM AS DEFINED IN
 SUBDIVISION TWENTY-THREE OF SECTION TWO HUNDRED EIGHTY-TWO OF THIS CHAP
 TER.
 

S 6. Paragraph 2 of subdivision (a) of section 1102 of the tax law, as
 amended by section 39-a of part K of chapter 61 of the laws of 2011,  is
 amended to read as follows:

 (2)  Every distributor of diesel motor fuel shall pay, as a prepayment
 on account of the taxes imposed by this  article  and  pursuant  to  the
 authority of article twenty-nine of this chapter, a tax upon the sale or
 use  of diesel motor fuel in this state. The tax shall be computed based
 upon the number of gallons of diesel motor fuel sold or used.  Provided,
 however,  if  the  tax  has  not been imposed prior thereto, it shall be
 imposed on the delivery  of  diesel  motor  fuel  to  a  retail  service
 station.  The collection of such tax shall not be made applicable to the
 sale or use of diesel motor fuel under circumstances which preclude  the
 collection  of  such tax by reason of the United States constitution and
 of laws of the United States enacted pursuant thereto. The  prepaid  tax
 on  diesel  motor  fuel  shall  not apply to (i) the sale of [previously
 untaxed] non-highway Diesel motor fuel  to  a  person  registered  as  a
 distributor  of Diesel motor fuel other than a sale to such person which
 involves a delivery at a filling station or into a repository  which  is
 equipped  with  a  hose  or  other  apparatus  by which such fuel can be
 dispensed into the fuel tank of a motor vehicle, [or] (ii) the  sale  to
 or  delivery  at a filling station or other retail vendor of water-white
 kerosene provided such filling station or other retail vendor only sells
 such water-white kerosene exclusively for heating purposes in containers
 of no more than twenty gallons; OR (III) THE SALE OF PREVIOUSLY  UNTAXED
 QUALIFIED  BIODIESEL  TO  A  PERSON REGISTERED UNDER ARTICLE TWELVE-A OF
 THIS CHAPTER AS A DISTRIBUTOR OF DIESEL MOTOR  FUEL  OTHER  THAN  (A)  A
 RETAIL SALE TO SUCH PERSON OR (B) A SALE TO SUCH PERSON WHICH INVOLVES A
 DELIVERY  AT  A  FILLING  STATION OR INTO A REPOSITORY WHICH IS EQUIPPED
 WITH A HOSE OR OTHER APPARATUS BY WHICH SUCH QUALIFIED BIODIESEL CAN  BE
 DISPENSED  INTO  THE FUEL TANK OF A MOTOR VEHICLE. "QUALIFIED BIODIESEL"
 
       S. 6259--B                         33                         A. 9059--B
 MEANS SUCH TERM AS DEFINED IN SUBDIVISION TWENTY-THREE  OF  SECTION  TWO
 HUNDRED EIGHTY-TWO OF THIS CHAPTER.
 

S  7. This act shall take effect June 1, 2012; provided, however, that
 the amendments to paragraph 2 of subdivision (a) of section 1102 of  the
 tax law made by section five of this act shall be subject to the expira
 tion  and  reversion of such paragraph pursuant to section 19 of part W1
 of chapter 109 of the laws of 2006, as amended, when upon such date  the
 provisions  of  section  six  of  this  act shall take effect; provided,
 further, that sections five and six of this act  shall  apply  to  sales
 made  and  uses occurring on and after such effective date in accordance
 with the applicable transitional provisions in sections 1106 and 1217 of
 the tax law.
 PART F
 

Section 1. Subparagraph (B) of  paragraph  4  of  subdivision  (a)  of
 section  1134  of  the  tax  law, as amended by chapter 2 of the laws of
 1995, is amended to read as follows:

 (B) Where a person files a certificate of registration for  a  certif
 icate of authority under this subdivision and in considering such appli
 cation  the  commissioner ascertains that (i) any tax imposed under this
 chapter or any related statute, as defined in section  eighteen  hundred
 of  this chapter, has been finally determined to be due from such person
 and has not been paid in full, (ii) [a] ANY tax [due under this  article
 or any law, ordinance or resolution enacted pursuant to the authority of
 article  twenty-nine] IMPOSED UNDER THIS CHAPTER OR ANY RELATED STATUTE,
 AS DEFINED IN SECTION EIGHTEEN HUNDRED of this chapter, has been finally
 determined to be due from an officer, director, partner or  employee  of
 such person, and, where such person is a limited liability company, also
 a  member or manager of such person, in the officer's, director's, part
 ner's, member's, manager's or employee's capacity as a  person  required
 to  collect  tax  on behalf of such person or another person and has not
 been paid, (iii) such person has been convicted of a crime provided  for
 in  this chapter within one year from the date on which such certificate
 of registration is filed, (iv) an officer, director, partner or employee
 of such person, and, where such person is a limited  liability  company,
 also  a member or manager of such person, which officer, director, part
 ner, member, manager or employee is a person required to collect tax  on
 behalf  of  such  person filing a certificate of registration has in the
 officer's, director's,  partner's,  member's,  manager's  or  employee's
 capacity as a person required to collect tax on behalf of such person or
 of another person been convicted of a crime provided for in this chapter
 within  one year from the date on which such certificate of registration
 is filed, (v) a shareholder owning more than fifty percent of the number
 of shares of stock of such person (where such person is  a  corporation)
 entitling  the  holder  thereof to vote for the election of directors or
 trustees, who owned more than fifty percent of the number of such shares
 of another person (where such other person is a corporation) at the time
 any tax imposed under this chapter or any related statute as defined  in
 section  eighteen  hundred  of this chapter was finally determined to be
 due and where such tax has not been paid in full, or at  the  time  such
 other person was convicted of a crime provided for in this chapter with
 in  one  year from the date on which such certificate of registration is
 filed, or (vi) a certificate of authority issued to such person has been
 revoked or suspended pursuant to  subparagraph  (A)  of  this  paragraph
 within  one year from the date on which such certificate of registration
 
       S. 6259--B                         34                         A. 9059--B
 is filed, the commissioner may refuse to issue a certificate of authori
 ty.
 

S 2. Subdivision (g) of section 1146 of the tax law, as added by chap
 ter 577 of the laws of 1997, is amended to read as follows:

 (g)  (1)  Notwithstanding  the  provisions  of subdivision (a) of this
 section, if the  commissioner  determines  that  a  person  required  to
 collect  tax is liable for any tax, penalty or interest under this arti
 cle or is liable for a penalty under subdivision (e) of  section  eleven
 hundred  forty-five  of  this  article with respect to any failure, upon
 request in writing of such person, the commissioner  shall  disclose  in
 writing  to  such person [(1)] (I) the name of any other person required
 to collect tax or any other person liable for such  penalty  under  such
 subdivision  (e)  whom  the commissioner has determined to be liable for
 the same tax, penalty or interest or for such penalty  with  respect  to
 such  failure,  and [(2)] (II) whether the commissioner has attempted to
 collect such tax, penalty or interest or such penalty  from  such  other
 person, the general nature of such collection activities, and the amount
 collected.
 (2) NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER TO THE CONTRARY, FOR
 THE PURPOSES OF SUBPARAGRAPH (B) OF PARAGRAPH FOUR OF SUBDIVISION (A) OF
 SECTION  ELEVEN  HUNDRED  THIRTY-FOUR  OF THIS PART, IF THE COMMISSIONER
 DETERMINES THAT ANY TAX IMPOSED UNDER THIS CHAPTER OR ANY RELATED  STAT
 UTE,  AS  DEFINED  IN SECTION EIGHTEEN HUNDRED OF THIS CHAPTER, HAS BEEN
 FINALLY DETERMINED TO BE DUE FROM A PERSON REQUIRED TO COLLECT  TAX  AND
 HAS  NOT  BEEN  PAID,  UPON  WRITTEN REQUEST OF THE PERSON WHO FILED THE
 CERTIFICATE OF REGISTRATION FOR A  CERTIFICATE  OF  AUTHORITY  THAT  WAS
 REFUSED,  THE  COMMISSIONER  MAY  DISCLOSE  TO  SUCH PERSON THE NAME AND
 AMOUNT OF TAX DUE OF THE PERSON OR PERSONS REQUIRED TO COLLECT TAX WHOSE
 TAX LIABILITY OR LIABILITIES WERE GROUNDS FOR THE REFUSAL TO  ISSUE  THE
 CERTIFICATE OF AUTHORITY.
 

S 3. This act shall take effect immediately.
 PART G
 

Section  1.  Paragraph  10 of subsection (g) of section 658 of the tax
 law is REPEALED.
 

S 2. Paragraph 10 of subdivision (g) of section 11-1758 of the  admin
 istrative code of the city of New York is REPEALED.
 

S  3.  Paragraph  5 of subsection (u) of section 685 of the tax law is
 REPEALED.
 

S 4. Paragraph 5 of subdivision (t) of section 11-1785 of the adminis
 trative code of the city of New York is REPEALED.
 

S 5.

Section 23 of part U of chapter 61 of the laws of 2011,  amending
 the  real  property tax law, the general municipal law, the public offi
 cers law, the tax law, the abandoned property law, the state finance law
 and the administrative code of the city of New York, relating to  estab
 lishing  standards  for  electronic  real  property  tax administration,
 allowing the department of taxation and finance to use electronic commu
 nication means to furnish tax notices  and  other  documents,  mandatory
 electronic  filing of tax documents, debit cards issued for tax refunds,
 improving sales tax compliance and repealing certain provisions  of  the
 tax  law  and  the  administrative code of the city of New York relating
 thereto, is amended to read as follows:

 

S 23. This act shall take effect immediately; provided, however, that:

 (a) the amendments to section 29 of the tax law made by section  thir
 teen  of  this  act shall apply to tax documents filed or required to be
 
       S. 6259--B                         35                         A. 9059--B
 filed on or after the sixtieth day  after  which  this  act  shall  have
 become  a  law  [and  shall  expire  and be deemed repealed December 31,
 2012], provided however that the amendments to paragraph 4  of  subdivi
 sion (a) of section 29 of the tax law and paragraph 2 of subdivision (e)
 of  section  29 of the tax law made by section thirteen of this act with
 regard to individual taxpayers shall take effect September 15, 2011  but
 only  if  the  commissioner  of taxation and finance has reported in the
 report required by section seventeen-b of this act that  the  percentage
 of  individual  taxpayers  electronically  filing  their 2010 income tax
 returns is less than eighty-five percent; provided that the commissioner
 of taxation and finance  shall  notify  the  legislative  bill  drafting
 commission  of the date of the issuance of such report in order that the
 commission may maintain an accurate and timely effective  data  base  of
 the official text of the laws of the state of New York in furtherance of
 effectuating  the  provisions  of  section 44 of the legislative law and
 section 70-b of the public officers law;
 (b) sections fourteen, fifteen, sixteen  and  seventeen  of  this  act
 shall  take  effect  September  15, 2011 but only if the commissioner of
 taxation and finance has reported in  the  report  required  by  section
 seventeen-b  of  this  act  that  the percentage of individual taxpayers
 electronically filing their 2010 income tax returns is less than  eight
 y-five percent;
 (c)  sections  fourteen-a  and fifteen-a of this act shall take effect
 September 15, 2011 and expire and be deemed repealed December  31,  2012
 but  shall  take effect only if the commissioner of taxation and finance
 has reported in the report required by section seventeen-b of  this  act
 that  the percentage of individual taxpayers electronically filing their
 2010 income tax returns is eighty-five percent or greater; AND
 (d) sections fourteen-b, fifteen-b, sixteen-a and seventeen-a of  this
 act  shall  take  effect January 1, 2013 but only if the commissioner of
 taxation and finance has reported in  the  report  required  by  section
 seventeen-b  of  this  act  that  the percentage of individual taxpayers
 electronically filing their 2010 income tax returns is less than  eight
 y-five percent[; and
 (e)  sections twenty-one and twenty-one-a of this act shall expire and
 be deemed repealed December 31, 2012].
 

S 6. Paragraph 2 of subsection (b) of section 29 of  the  tax  law  as
 added  by  section  13  of  part U of chapter 61 of the laws of 2011, is
 amended to read as follows:

 (2) If a tax return preparer prepared  more  than  five  original  tax
 documents  during any calendar year beginning on or after January first,
 two thousand eleven, and if in any succeeding  calendar  year  that  tax
 return  preparer prepares one or more authorized [returns] TAX DOCUMENTS
 using tax software, then, for such succeeding calendar year and for each
 subsequent  calendar  year  thereafter,  all  authorized  tax  documents
 prepared  by  that  tax return preparer must be filed electronically, in
 accordance with instructions prescribed by the commissioner.
 

S 7. This act shall take effect immediately, provided,  however,  that
 the amendments to paragraph 2 of subsection (b) of section 29 of the tax
 law made by section six of this act shall be deemed to have been in full
 force  and  effect on the same date and in the same manner as section 13
 of part U of chapter 61 of the laws of 2011, as amended, took effect.
 PART H
 
       S. 6259--B                         36                         A. 9059--B
 

Section 1. Paragraphs 2, 3 and 7 of subsection (g-1) of section 606 of
 the tax law, paragraph 2 as amended by chapter 378 of the laws of  2005,
 subparagraph (B) of paragraph 2 as amended by chapter 251 of the laws of
 2006,  paragraph  3  as  amended  by chapter 128 of the laws of 2007 and
 paragraph  7  as  renumbered  by  chapter  128  of the laws of 2007, are
 amended to read as follows:

 (2) Qualified solar energy system equipment expenditures. (A) The term
 "qualified solar energy system equipment  expenditures"  means  expendi
 tures for:

 (I)  the  purchase of solar energy system equipment which is installed
 in connection with residential property which is [(i)]  (I)  located  in
 this  state  and [(ii) which is] (II) used by the taxpayer as his or her
 principal residence at the time the solar  energy  system  equipment  is
 placed in service;
 (II) THE LEASE OF SOLAR ENERGY SYSTEM EQUIPMENT UNDER A WRITTEN AGREE
 MENT  THAT  SPANS  AT  LEAST  TEN  YEARS WHERE SUCH EQUIPMENT OWNED BY A
 PERSON OTHER THAN THE TAXPAYER IS INSTALLED IN CONNECTION WITH  RESIDEN
 TIAL  PROPERTY WHICH IS: (I) LOCATED IN THIS STATE; AND (II) USED BY THE
 TAXPAYER AS HIS OR HER PRINCIPAL RESIDENCE AT THE TIME THE SOLAR  ENERGY
 SYSTEM EQUIPMENT IS PLACED IN SERVICE; OR
 (III)  THE  PURCHASE  OF POWER UNDER A WRITTEN AGREEMENT THAT SPANS AT
 LEAST TEN YEARS WHERE THE POWER PURCHASED IS GENERATED BY  SOLAR  ENERGY
 SYSTEM  EQUIPMENT  OWNED  BY  A  PERSON  OTHER  THAN THE TAXPAYER AND IS
 INSTALLED IN CONNECTION WITH RESIDENTIAL PROPERTY WHICH IS: (I)  LOCATED
 IN  THIS  STATE;  AND  (II) USED BY THE TAXPAYER AS HIS OR HER PRINCIPAL
 RESIDENCE AT THE TIME THE SOLAR ENERGY SYSTEM IS PLACED IN SERVICE.
 (B) Such qualified expenditures shall include expenditures for materi
 als, labor costs properly allocable to on-site preparation, assembly and
 original  installation,  architectural  and  engineering  services,  and
 designs  and  plans directly related to the construction or installation
 of the solar energy system equipment.
 (C) Such qualified expenditures shall not include  interest  or  other
 finance charges.
 (D)   SUCH   QUALIFIED  SOLAR  ENERGY  SYSTEM  EQUIPMENT  EXPENDITURES
 DESCRIBED IN CLAUSE (II) OR (III) OF SUBPARAGRAPH (A) OF THIS  PARAGRAPH
 SHALL  INCLUDE  AN  AMOUNT EQUAL TO ALL PAYMENTS MADE DURING THE TAXABLE
 YEAR UNDER SUCH AGREEMENT.
 (E) NOTWITHSTANDING PARAGRAPH ONE OF THIS SUBDIVISION, A TAXPAYER  MAY
 CLAIM  CREDIT  FOR  EXPENDITURES  DESCRIBED  IN  CLAUSE (II) OR (III) OF
 SUBPARAGRAPH (A) OF THIS PARAGRAPH FOR THREE CONSECUTIVE TAXABLE  YEARS;
 PROVIDED, HOWEVER, THAT THE AMOUNT CLAIMED IN ANY TAXABLE YEAR SHALL NOT
 EXCEED THE AMOUNT OF SUCH EXPENDITURES IN THAT YEAR AND THE TOTAL AMOUNT
 OF  CREDITS  CLAIMED  BY  A  TAXPAYER FOR ALL TAXABLE YEARS SHALL BE THE
 LESSER OF TWELVE AND ONE-HALF PERCENT OF THE TOTAL  AMOUNT  TO  BE  PAID
 UNDER THE WRITTEN AGREEMENTS DESCRIBED IN SUCH CLAUSES, OR FIVE THOUSAND
 DOLLARS;  AND  PROVIDED  FURTHER  THAT  NO  CREDIT  SHALL BE ALLOWED FOR
 EXPENDITURES DESCRIBED IN CLAUSE (II) OR (III) OF  SUBPARAGRAPH  (A)  OF
 THIS PARAGRAPH WHERE THE WRITTEN AGREEMENT DESCRIBED IN SUCH CLAUSES WAS
 ENTERED INTO ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN.
 (3)  Solar  energy  system  equipment.  The  term "solar energy system
 equipment" shall  mean  an  arrangement  or  combination  of  components
 utilizing solar radiation, which, when installed in a residence, produc
 es energy designed to provide heating, cooling, hot water or electricity
 for  use  in  such  residence.  Such arrangement or components shall not
 include equipment connected to solar energy system equipment that  is  a
 component  of  part  or parts of a non-solar energy system or which uses
 
       S. 6259--B                         37                         A. 9059--B
 any sort of recreational facility or  equipment  as  a  storage  medium.
 Solar  energy  system  equipment that generates electricity for use in a
 residence must conform to applicable requirements set forth  in  section
 sixty-six-j  of  the  public service law. Provided, however, where solar
 energy system equipment is purchased  and  installed  by  a  condominium
 management   association  or  a  cooperative  housing  corporation,  for
 purposes  of  this  subsection  only,   the   term   ["ten   kilowatts"]
 "TWENTY-FIVE  KILOWATTS"  in  such  section sixty-six-j shall be read as
 "fifty kilowatts."
 (7) When credit allowed. The  credit  provided  for  herein  shall  be
 allowed  with  respect  to  the  taxable year, commencing after nineteen
 hundred ninety-seven, in which the  solar  energy  system  equipment  is
 placed  in service, OR WHEN THE EXPENDITURES DESCRIBED IN CLAUSE (II) OR
 (III) OF SUBPARAGRAPH (A) OF THIS SECTION ARE INCURRED, AS APPLICABLE.
 

S 2. Subdivision (ee) of section 1115 of the  tax  law,  as  added  by
 chapter 306 of the laws of 2005, is amended to read as follows:

 (ee)  Receipts  from  the  retail  sale  of [residential] solar energy
 systems equipment and of the service of installing such systems shall be
 exempt from tax under this article. For the purposes  of  this  subdivi
 sion,  "[residential]  solar  energy  systems  equipment"  shall mean an
 arrangement or combination of components [installed in a residence] that
 utilizes solar radiation to produce energy designed to provide  heating,
 cooling,  hot  water  and/or  electricity  IN A BUILDING OR A STRUCTURE.
 Such arrangement or components shall not [include] EXCEED  AN  INSTALLED
 CAPACITY  RATING  OF TWO MEGAWATTS OR THE THERMAL EQUIVALENT THEREOF AND
 SHALL NOT INCLUDE equipment that is part of a non-solar energy system or
 [which uses any sort of recreational facility or equipment as a  storage
 medium] SYSTEMS OR EQUIPMENT USED TO HEAT RESIDENTIAL SWIMMING POOLS.
 

S 3. Paragraph 1 of subdivision (a) of section 1210 of the tax law, as
 amended  by  section  3 of part GG of chapter 57 of the laws of 2010, is
 amended to read as follows:

 (1) Either, all of the taxes described in article twenty-eight of this
 chapter, at the same uniform rate, as to which taxes all  provisions  of
 the  local  laws, ordinances or resolutions imposing such taxes shall be
 identical, except as to rate and except as otherwise provided, with  the
 corresponding  provisions  in  such  article twenty-eight, including the
 definition and exemption provisions of  such  article,  so  far  as  the
 provisions  of  such  article twenty-eight can be made applicable to the
 taxes imposed by such city or  county  and  with  such  limitations  and
 special  provisions  as are set forth in this article. The taxes author
 ized under this subdivision may not be  imposed  by  a  city  or  county
 unless  the  local law, ordinance or resolution imposes such taxes so as
 to include all portions and all types of  receipts,  charges  or  rents,
 subject  to  state  tax  under  sections  eleven hundred five and eleven
 hundred ten of this chapter, except as otherwise provided. (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 author
 ized 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,
 
       S. 6259--B                         38                         A. 9059--B
 unless such city, county or school district elects otherwise, shall omit
 the  provision  for credit or refund contained in clause six of subdivi
 sion (a) or subdivision (d) of section eleven hundred nineteen  of  this
 chapter.  (ii)  Any  local  law,  ordinance or resolution enacted by any
 city, county or school district, imposing the taxes authorized  by  this
 subdivision, shall omit the [residential] solar energy systems equipment
 exemption provided for in subdivision (ee) and the clothing and footwear
 exemption provided for in paragraph thirty of subdivision (a) of section
 eleven  hundred  fifteen  of  this  chapter, unless such city, county or
 school district elects otherwise as to either such  [residential]  solar
 energy  systems  equipment  exemption  or  such  clothing  and  footwear
 exemption.
 

S 4. Paragraph 1 of subdivision (n) of section 1210 of the tax law, as
 added by chapter 306 of the laws of 2005, is amended to read as follows:

 (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  [residential]  solar  energy systems equipment exemption from state
 sales and compensating  use  taxes  described  in  subdivision  (ee)  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 subdivisions (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 legislature and approved by the
 governor.
 

S 5. This act shall take effect immediately, provided that:

 (1) section one of this act shall apply  to  leases  of  solar  energy
 system equipment and purchases of power under written agreements entered
 into on or after such effective date; and
 (2) sections two, three and four of this act shall apply to sales made
 or  uses  occurring on or after September 1, 2012 in accordance with the
 applicable transitional provisions of sections 1106 and 1217 of the  tax
 law.
 PART I
 

Section  1.  Paragraph  1  of subdivision (a) of section 28 of the tax
 law, as amended by chapter 440 of the laws of 2006, is amended  to  read
 as follows:

 (1)  A taxpayer which is a qualified commercial production company, or
 which is a sole proprietor of a qualified commercial production company,
 and which is subject to tax under article nine-A or twenty-two  of  this
 chapter,  shall  be  allowed  a credit against such tax, pursuant to the
 provisions referenced in subdivision [(d)] (C) of this  section,  to  be
 computed  as provided in this section. Provided, however, to be eligible
 for such credit, at least seventy-five percent of the  production  costs
 (excluding post production costs) paid or incurred directly and predomi
 nantly  in  the  actual filming or recording of the qualified commercial
 must be costs incurred in New York state.  THE TAX CREDIT ALLOWED PURSU
 ANT TO THIS SECTION SHALL APPLY TO TAXABLE YEARS BEGINNING BEFORE  JANU
 ARY FIRST, TWO THOUSAND SEVENTEEN.
 
       S. 6259--B                         39                         A. 9059--B
 

S 2. Paragraph (a) of subdivision 38 of section 210 of the tax law, as
 added  by  section  3  of  part  V of chapter 62 of the laws of 2006, is
 amended to read as follows:

 (a)  Allowance  of  credit.  A  taxpayer  that is eligible pursuant to
 provisions of section twenty-eight of this chapter shall  be  allowed  a
 credit  to  be  computed  as  provided  in  such section against the tax
 imposed by this article.   THE  TAX  CREDIT  ALLOWED  PURSUANT  TO  THIS
 SECTION SHALL APPLY TO TAXABLE YEARS BEGINNING BEFORE JANUARY FIRST, TWO
 THOUSAND SEVENTEEN.
 

S  3. Paragraph 1 of subsection (jj) of section 606 of the tax law, as
 added by section 5 of part V of chapter 62  of  the  laws  of  2006,  is
 amended to read as follows:

 (1)  Allowance  of credit. A taxpayer that is eligible pursuant to the
 provisions of section twenty-eight of this chapter shall  be  allowed  a
 credit  to  be  computed  as  provided  in  such section against the tax
 imposed by this article.   THE  TAX  CREDIT  ALLOWED  PURSUANT  TO  THIS
 SECTION SHALL APPLY TO TAXABLE YEARS BEGINNING BEFORE JANUARY FIRST, TWO
 THOUSAND SEVENTEEN.
 

S  4.

Section 10 of part V of chapter 62 of the laws of 2006, relating
 to the empire state commercial production tax credit, is amended to read
 as follows:

 

S 10. This act shall take effect immediately [and shall apply to taxa-
 ble years beginning on and after January 1, 2007 and shall expire and be
 deemed repealed on December 31, 2011]; provided, however  that  the  IMB
 credit  for  energy  taxes  under  subsection  (t-1)  and the state film
 production credit under subsection (gg) of section 606 of  the  tax  law
 contained  in  section four of this act shall expire on the same date as
 provided in subdivision (a) of section 49 of part Y of chapter 63 of the
 laws of 2000, as amended and section 9 of part P of chapter  60  of  the
 laws of 2004, as amended, respectively.
 

S 5. This act shall take effect immediately.
 PART J
 

Section  1.  Subdivision 4 of section 22 of the public housing law, as
 amended by section 1 of part F of chapter 61 of the  laws  of  2011,  is
 amended to read as follows:

 4.  Statewide  limitation. The aggregate dollar amount of credit which
 the commissioner may allocate to  eligible  low-income  buildings  under
 this article shall be [thirty-two] FORTY million dollars. The limitation
 provided by this subdivision applies only to allocation of the aggregate
 dollar  amount  of  credit  by  the  commissioner, and does not apply to
 allowance to a taxpayer of the credit with respect to an  eligible  low
 income building for each year of the credit period.
 

S 2. Subdivision 4 of section 22 of the public housing law, as amended
 by section one of this act, is amended to read as follows:

 4.  Statewide  limitation. The aggregate dollar amount of credit which
 the commissioner may allocate to  eligible  low-income  buildings  under
 this  article  shall be [forty] FORTY-EIGHT million dollars. The limita
 tion provided by this subdivision applies  only  to  allocation  of  the
 aggregate  dollar  amount  of  credit  by the commissioner, and does not
 apply to allowance to a taxpayer of the credit with respect to an eligi
 ble low-income building for each year of the credit period.
 

S 3. Subdivision 4 of section 22 of the public housing law, as amended
 by section two of this act, is amended to read as follows:

 
       S. 6259--B                         40                         A. 9059--B
 4. Statewide limitation. The aggregate dollar amount of  credit  which
 the  commissioner  may  allocate  to eligible low-income buildings under
 this article shall be [forty-eight] FIFTY-SIX million dollars. The limi
 tation provided by this subdivision applies only to  allocation  of  the
 aggregate  dollar  amount  of  credit  by the commissioner, and does not
 apply to allowance to a taxpayer of the credit with respect to an eligi
 ble low-income building for each year of the credit period.
 

S 4. Subdivision 4 of section 22 of the public housing law, as amended
 by section three of this act, is amended to read as follows:

 4. Statewide limitation. The aggregate dollar amount of  credit  which
 the  commissioner  may  allocate  to eligible low-income buildings under
 this article shall be [fifty-six] SIXTY-FOUR million dollars. The  limi
 tation  provided  by  this subdivision applies only to allocation of the
 aggregate dollar amount of credit by  the  commissioner,  and  does  not
 apply to allowance to a taxpayer of the credit with respect to an eligi
 ble low-income building for each year of the credit period.
 

S 5. Subdivision 4 of section 22 of the public housing law, as amended
 by section four of this act, is amended to read as follows:

 4.  Statewide  limitation. The aggregate dollar amount of credit which
 the commissioner may allocate to  eligible  low-income  buildings  under
 this  article  shall  be  [sixty-four]  SEVENTY-TWO million dollars. The
 limitation provided by this subdivision applies only  to  allocation  of
 the  aggregate dollar amount of credit by the commissioner, and does not
 apply to allowance to a taxpayer of the credit with respect to an eligi
 ble low-income building for each year of the credit period.
 

S 6. This  act  shall  take  effect  immediately;  provided,  however,
 section  two  of this act shall take effect April 1, 2013, section three
 of this act shall take effect April 1, 2014, section four  of  this  act
 shall  take effect April 1, 2015 and section five of this act shall take
 effect April 1, 2016.
 PART K
 

Section 1. Subdivision (a) of section 28 of the tax law, as amended by
 section 1 of part A of chapter 57 of the laws of  2010,  is  amended  to
 read as follows:

 (a)  General.  A taxpayer subject to tax under article nine, nine-A or
 twenty-two of this chapter shall be allowed a credit  against  such  tax
 pursuant  to  the  provisions  referenced  in  subdivision  (d)  of this
 section. The credit (or pro rata share of earned credit in the case of a
 partnership) for each gallon of biofuel produced at a biofuel  plant  on
 or  after  January first, two thousand six shall equal fifteen cents per
 gallon after the production of the first forty thousand gallons per year
 presented to market. The credit under this section shall  be  capped  at
 two and one-half million dollars per taxpayer per taxable year for up to
 no  more  than four consecutive taxable years per biofuel plant.  If the
 taxpayer is a partner in a partnership or shareholder of a  New  York  S
 corporation,  then  the  cap  imposed by the preceding sentence shall be
 applied at the entity level, so that the aggregate credit allowed to all
 the partners or shareholders of each such entity  in  the  taxable  year
 does not exceed two and one-half million dollars. THE TAX CREDIT ALLOWED
 PURSUANT  TO  THIS SECTION SHALL APPLY TO TAXABLE YEARS BEGINNING BEFORE
 JANUARY FIRST, TWO THOUSAND TWENTY.
 

S 2.

Section 187-c of the tax law, as added by section 2 of part X  of
 chapter 62 of the laws of 2006, is amended to read as follows:

 
       S. 6259--B                         41                         A. 9059--B
 

S  187-c.  Biofuel  production  credit.  A taxpayer shall be allowed a
 credit to be computed as provided in section twenty-eight of this  chap
 ter, AS ADDED BY PART X OF CHAPTER SIXTY-TWO OF THE LAWS OF TWO THOUSAND
 SIX,  against  the  tax imposed by this article. Provided, however, that
 the amount of such credit allowed against the tax imposed by section one
 hundred eighty-four of this article shall be the excess of the amount of
 such  credit  over  the  amount  of  any  credit allowed by this section
 against the tax imposed by section  one  hundred  eighty-three  of  this
 article.  In  no event shall the credit under this section be allowed in
 an amount which will reduce the tax payable to less than the  applicable
 minimum  tax  fixed  by  section one hundred eighty-three or one hundred
 eighty-five of this article. If,  however,  the  amount  of  the  credit
 allowed  under this section for any taxable year reduces the tax to such
 amount, the excess shall be treated as an overpayment of tax to be cred
 ited or refunded in  accordance  with  the  provisions  of  section  six
 hundred 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.    THE  TAX  CREDIT
 ALLOWED  PURSUANT TO THIS SECTION SHALL APPLY TO TAXABLE YEARS BEGINNING
 BEFORE JANUARY FIRST, TWO THOUSAND TWENTY.
 

S 3. Subdivision 38 of section 210 of the tax law, as added by section
 3 of part X of chapter 62 of the laws of 2006, is  amended  to  read  as
 follows:

 38.  Biofuel  production credit. A taxpayer shall be allowed a credit,
 to be computed as provided in section twenty-eight of this  chapter,  AS
 ADDED  BY  PART  X OF CHAPTER SIXTY-TWO OF THE LAWS OF TWO THOUSAND SIX,
 against the tax imposed by this article. 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.    THE  TAX  CREDIT
 ALLOWED  PURSUANT TO THIS SECTION SHALL APPLY TO TAXABLE YEARS BEGINNING
 BEFORE JANUARY FIRST, TWO THOUSAND TWENTY.
 

S 4. Subsection (jj) of section 606  of  the  tax  law,  as  added  by
 section  5  of  part  X of chapter 62 of the laws of 2006, is amended to
 read as follows:

 (jj) Biofuel production credit. A taxpayer shall be allowed  a  credit
 to  be  computed as provided in section twenty-eight of this chapter, AS
 ADDED BY PART X OF CHAPTER SIXTY-TWO OF THE LAWS OF  TWO  THOUSAND  SIX,
 against  the  tax  imposed  by this article. If the amount of the credit
 allowed under this subsection for any  taxable  year  shall  exceed  the
 taxpayer's tax for such year, the excess shall be treated as an overpay
 ment 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 shall be paid thereon.  THE TAX CREDIT ALLOWED PURSUANT
 TO THIS SECTION SHALL APPLY TO TAXABLE YEARS  BEGINNING  BEFORE  JANUARY
 FIRST, TWO THOUSAND TWENTY.
 

S  5. 

Section 6 of part X of chapter 62 of the laws of 2006, amending
 the tax law relating to providing tax  credits  for  biofuel  production
 plants, is amended to read as follows:

 
       S. 6259--B                         42                         A. 9059--B
 

S  6. This act shall take effect immediately [and shall apply to taxa-
 ble years commencing on and after January 1, 2006 and before January  1,
 2013];  provided,  however  that  the  IMB credit for energy taxes under
 subsection (t-1) and the state film production credit  under  subsection
 (gg) of section 606 of the tax law contained in section four of this act
 shall  expire on the same date as provided in subdivision (a) of section
 49 of part Y of chapter 63 of the laws of 2000, as amended and section 9
 of part P of chapter 60 of the laws of 2004, as amended, respectively.
 

S 6. This act shall take effect immediately.
 PART L
 

Section 1.

Section 2 of part I of chapter 58  of  the  laws  of  2006,
 relating  to  providing an enhanced earned income tax credit, is amended
 to read as follows:

 

S 2. This act shall take effect immediately and shall apply to taxable
 years beginning on or after January  1,  2006  [and  before  January  1,
 2013].
 

S 2. This act shall take effect immediately.
 PART M
 

Section 1.

Section 5232 of the civil practice law and rules is amended
 by adding a new subdivision (i) to read as follows:

 (I)  NO  BANKING  INSTITUTION SHALL SETOFF AND APPLY A LEVY PROCESSING
 FEE AGAINST THE PROCEEDS OF A LEVY FOR TAXES IMPOSED BY OR  PURSUANT  TO
 THE  AUTHORITY  OF  THE  TAX  LAW OR FOR CHILD SUPPORT REGARDLESS OF ANY
 TERMS OF AGREEMENT, OR SCHEDULE OF FEES, OR OTHER CONTRACT  BETWEEN  THE
 DEBTOR AND THE BANKING INSTITUTION.
 

S 2. Subdivision (d) of section 151 of the debtor and creditor law, as
 amended  by  chapter  553  of  the  laws  of 1990, is amended to read as
 follows:

 (d) the issuance of any execution against any of  the  property  of  a
 creditor, EXCEPT AS PROVIDED FOR IN SUBDIVISION (I) OF SECTION FIFTY-TWO
 HUNDRED THIRTY-TWO OF THE CIVIL PRACTICE LAW AND RULES;
 

S  3.   This act shall take effect on the ninetieth day after it shall
 have become a law.
 PART N
 

Section 1. Subsection (a) of section 801 of the tax law, as amended by
 section 2 of part B of chapter 56 of the laws of  2011,  is  amended  to
 read as follows:

 (a)  For  the sole purpose of providing an additional stable and reli
 able  dedicated  funding  source  for  the  metropolitan  transportation
 authority  and  its subsidiaries and affiliates to preserve, operate and
 improve essential transit and transportation services in  the  metropol
 itan  commuter  transportation  district,  a  tax  is  hereby imposed on
 EMPLOYERS AND INDIVIDUALS AS FOLLOWS: (1) FOR employers  who  engage  in
 business  within  the  MCTD  [(1)],  THE TAX IS IMPOSED at a rate of (A)
 eleven hundredths (.11) percent OF THE  PAYROLL  EXPENSE  for  employers
 with payroll expense no greater than three hundred seventy-five thousand
 dollars  in  any  calendar  quarter,  (B)  twenty-three hundredths (.23)
 percent OF THE PAYROLL EXPENSE for employers with payroll expense great
 er than three hundred seventy-five thousand dollars and no greater  than
 four  hundred thirty-seven thousand five hundred dollars in any calendar
 
       S. 6259--B                         43                         A. 9059--B
 quarter, and (C) thirty-four hundredths (.34)  percent  OF  THE  PAYROLL
 EXPENSE  for  employers  with  payroll expense in excess of four hundred
 thirty-seven thousand five hundred dollars  in  any  calendar  quarter[,
 and].  IF  THE  EMPLOYER  IS  A  PROFESSIONAL  EMPLOYER ORGANIZATION, AS
 DEFINED IN SECTION NINE HUNDRED SIXTEEN OF THE LABOR LAW, THE EMPLOYER'S
 TAX SHALL BE CALCULATED BY DETERMINING THE PAYROLL EXPENSE  ATTRIBUTABLE
 TO  EACH  CLIENT  WHO HAS ENTERED INTO A PROFESSIONAL EMPLOYER AGREEMENT
 WITH SUCH ORGANIZATION AND THE  PAYROLL  EXPENSE  ATTRIBUTABLE  TO  SUCH
 ORGANIZATION  ITSELF,  MULTIPLYING EACH OF THOSE PAYROLL EXPENSE AMOUNTS
 BY THE APPLICABLE RATE SET FORTH IN  THIS  PARAGRAPH  AND  ADDING  THOSE
 PRODUCTS  TOGETHER. (2) FOR INDIVIDUALS, THE TAX IS IMPOSED at a rate of
 thirty-four hundredths (.34) percent of the net earnings  from  self-em
 ployment  of individuals that are attributable to the MCTD if such earn
 ings attributable to the MCTD exceed fifty thousand dollars for the  tax
 year.
 

S  2. 

Section  4 of part B of chapter 56 of the laws of 2011 amending
 the tax law relating to the tax rates and exclusions under the metropol
 itan commuter transportation mobility tax is amended to read as follows:

 

S 4. This act shall take effect immediately AND SHALL APPLY TO TAXABLE
 YEARS BEGINNING ON OR AFTER JANUARY  1,  2012;  provided  however,  that
 section  one  of  this act and the amendments in section two of this act
 that concern employers shall take effect for the  quarter  beginning  on
 April 1, 2012.
 

S 3. This act shall take effect immediately; provided however that the
 amendment  in  section  one of this act concerning professional employer
 organizations shall take effect for the quarter beginning  on  April  1,
 2012.
 PART O
 

Section  1.  Paragraph  (a)  of  subdivision  1 of section 1003 of the
 racing, pari-mutuel wagering and breeding law, as amended by  section  1
 of  part 

S  of  chapter  61  of the laws of 2011, is amended to read as
 follows:

 (a) Any  racing  association  or  corporation  or  regional  off-track
 betting  corporation,  authorized  to conduct pari-mutuel wagering under
 this chapter, desiring to display the simulcast of horse races on  which
 pari-mutuel  betting shall be permitted in the manner and subject to the
 conditions provided for in this article may apply to  the  board  for  a
 license so to do. Applications for licenses shall be in such form as may
 be  prescribed  by the board and shall contain such information or other
 material or evidence as the board  may  require.  No  license  shall  be
 issued  by the board authorizing the simulcast transmission of thorough
 bred races from a track located in Suffolk  county.  The  fee  for  such
 licenses  shall  be five hundred dollars per simulcast facility per year
 payable by the licensee to the board for deposit into the general  fund.
 Except  as  provided herein, the board shall not approve any application
 to conduct simulcasting into individual or group  residences,  homes  or
 other areas for the purposes of or in connection with pari-mutuel wager
 ing.  The board may approve simulcasting into residences, homes or other
 areas to be conducted jointly by one or more regional off-track  betting
 corporations and one or more of the following: a franchised corporation,
 thoroughbred racing corporation or a harness racing corporation or asso
 ciation;  provided  (i) the simulcasting consists only of those races on
 which pari-mutuel betting is authorized by this chapter at one  or  more
 simulcast  facilities  for  each  of  the  contracting off-track betting
 
       S. 6259--B                         44                         A. 9059--B
 corporations which shall include wagers made in accordance with  section
 one thousand fifteen, one thousand sixteen and one thousand seventeen of
 this  article;  provided  further  that the contract provisions or other
 simulcast  arrangements  for  such  simulcast  facility shall be no less
 favorable than those in effect on January first, two thousand five; (ii)
 that each off-track betting corporation  having  within  its  geographic
 boundaries  such residences, homes or other areas technically capable of
 receiving the simulcast signal shall be a contracting party;  (iii)  the
 distribution  of  revenues  shall be subject to contractual agreement of
 the parties except that statutory payments to  non-contracting  parties,
 if  any,  may  not be reduced; provided, however, that nothing herein to
 the contrary shall prevent a track  from  televising  its  races  on  an
 irregular basis primarily for promotional or marketing purposes as found
 by  the board. For purposes of this paragraph, the provisions of section
 one thousand thirteen of this article shall  not  apply.  Any  agreement
 authorizing  an  in-home simulcasting experiment commencing prior to May
 fifteenth, nineteen hundred ninety-five, may,  and  all  its  terms,  be
 extended until June thirtieth, two thousand [twelve] THIRTEEN; provided,
 however,  that  any  party to such agreement may elect to terminate such
 agreement upon conveying written notice to all  other  parties  of  such
 agreement  at  least  forty-five days prior to the effective date of the
 termination, via registered mail. Any party to  an  agreement  receiving
 such  notice of an intent to terminate, may request the board to mediate
 between the parties new terms and conditions in a replacement  agreement
 between the parties as will permit continuation of an in-home experiment
 until  June  thirtieth,  two  thousand  [twelve]  THIRTEEN;  and (iv) no
 in-home simulcasting in the thoroughbred special betting district  shall
 occur without the approval of the regional thoroughbred track.
 

S  2.  Subparagraph  (iii)  of paragraph d of subdivision 3 of section
 1007 of the racing, pari-mutuel wagering and breeding law, as amended by
 section 2 of part

S of chapter 61 of the laws of  2011,  is  amended  to
 read as follows:

 (iii) Of the sums retained by a receiving track located in Westchester
 county  on  races received from a franchised corporation, for the period
 commencing January first, two thousand eight and continuing through June
 thirtieth, two thousand [twelve] THIRTEEN, the amount  used  exclusively
 for  purses  to  be  awarded  at races conducted by such receiving track
 shall be computed as follows: of the sums so retained, two and  one-half
 percent  of the total pools. Such amount shall be increased or decreased
 in the amount of fifty percent of the difference  in  total  commissions
 determined by comparing the total commissions available after July twen
 ty-first,  nineteen  hundred  ninety-five  to the total commissions that
 would have been available to such  track  prior  to  July  twenty-first,
 nineteen hundred ninety-five.
 

S  3.  The  opening  paragraph of subdivision 1 of section 1014 of the
 racing, pari-mutuel wagering and breeding law, as amended by  section  3
 of  part 

S  of  chapter  61  of the laws of 2011, is amended to read as
 follows:

 The provisions of this section shall govern the simulcasting of  races
 conducted  at thoroughbred tracks located in another state or country on
 any day during which a franchised corporation is conducting a race meet
 ing in Saratoga county at Saratoga  thoroughbred  racetrack  until  June
 thirtieth,  two  thousand [twelve] THIRTEEN and on any day regardless of
 whether or not a franchised corporation is conducting a race meeting  in
 Saratoga county at Saratoga thoroughbred racetrack after June thirtieth,
 two  thousand [twelve] THIRTEEN. On any day on which a franchised corpo
 
       S. 6259--B                         45                         A. 9059--B
 ration has not scheduled a racing  program  but  a  thoroughbred  racing
 corporation  located  within  the state is conducting racing, every off
 track betting corporation branch office and every simulcasting  facility
 licensed  in  accordance  with  section  one  thousand  seven (that have
 entered into a written agreement  with  such  facility's  representative
 horsemen's  organization, as approved by the board), one thousand eight,
 or one thousand nine of this  article  shall  be  authorized  to  accept
 wagers  and  display  the live simulcast signal from thoroughbred tracks
 located in another state or foreign country  subject  to  the  following
 provisions:

 

S 4. Subdivision 1 of section 1015 of the racing, pari-mutuel wagering
 and breeding law, as amended by section 4 of part

S of chapter 61 of the
 laws of 2011, is amended to read as follows:

 1.  The  provisions  of  this section shall govern the simulcasting of
 races conducted at harness tracks located in another  state  or  country
 during  the period July first, nineteen hundred ninety-four through June
 thirtieth, two thousand [twelve] THIRTEEN.  This section shall supersede
 all inconsistent provisions of this chapter.
 

S 5. The opening paragraph of subdivision 1 of  section  1016  of  the
 racing,  pari-mutuel  wagering and breeding law, as amended by section 5
 of part

S of chapter 61 of the laws of  2011,  is  amended  to  read  as
 follows:

 The  provisions of this section shall govern the simulcasting of races
 conducted at thoroughbred tracks located in another state or country  on
 any  day  during which a franchised corporation is not conducting a race
 meeting in Saratoga county at Saratoga thoroughbred racetrack until June
 thirtieth, two thousand [twelve]  THIRTEEN.    Every  off-track  betting
 corporation  branch  office  and every simulcasting facility licensed in
 accordance with section one thousand seven  that  have  entered  into  a
 written  agreement with such facility's representative horsemen's organ
 ization as approved by the board, one thousand  eight  or  one  thousand
 nine  of  this  article shall be authorized to accept wagers and display
 the live full-card simulcast signal of thoroughbred  tracks  (which  may
 include  quarter horse or mixed meetings provided that all such wagering
 on such races shall be construed to be thoroughbred  races)  located  in
 another  state  or foreign country, subject to the following provisions;
 provided, however, no such written agreement  shall  be  required  of  a
 franchised  corporation licensed in accordance with section one thousand
 seven of this article:

 

S 6. The opening paragraph of section 1018 of the racing,  pari-mutuel
 wagering  and breeding law, as amended by section 6 of part

S of chapter
 61 of the laws of 2011, is amended to read as follows:

 Notwithstanding any other provision of this chapter,  for  the  period
 July  twenty-fifth, two thousand one through September eighth, two thou
 sand [eleven] TWELVE, when a franchised corporation is conducting a race
 meeting within the  state  at  Saratoga  Race  Course,  every  off-track
 betting  corporation  branch  office  and  every  simulcasting  facility
 licensed in accordance with section one thousand seven (that has entered
 into a written agreement with such facility's representative  horsemen's
 organization  as approved by the board), one thousand eight or one thou
 sand nine of this article shall  be  authorized  to  accept  wagers  and
 display  the  live  simulcast signal from thoroughbred tracks located in
 another state, provided that such facility shall accept wagers on  races
 run  at  all  in-state  thoroughbred  tracks which are conducting racing
 programs subject to the following provisions; provided, however, no such
 
       S. 6259--B                         46                         A. 9059--B
 written agreement shall be required of a franchised corporation licensed
 in accordance with section one thousand seven of this article.
 

S  7. 

Section  32  of  chapter  281 of the laws of 1994, amending the
 racing, pari-mutuel wagering and breeding law and other laws relating to
 simulcasting, as amended by section 7 of part

S of  chapter  61  of  the
 laws of 2011, is amended to read as follows:

 

S  32.  This act shall take effect immediately and the pari-mutuel tax
 reductions in section six  of  this  act  shall  expire  and  be  deemed
 repealed  on  July  1,  [2012]  2013;  provided,  however,  that nothing
 contained herein shall be deemed to affect the  application,  qualifica
 tion,  expiration,  or  repeal  of  any  provision of law amended by any
 section of this act, and such provisions shall be applied  or  qualified
 or  shall  expire  or be deemed repealed in the same manner, to the same
 extent and on the same date as the case may be as otherwise provided  by
 law;  provided  further, however, that sections twenty-three and twenty
 five of this act shall remain in full force and effect only until May 1,
 1997 and at such time shall be deemed to be repealed.
 

S 8.

Section 54 of chapter 346 of  the  laws  of  1990,  amending  the
 racing, pari-mutuel wagering and breeding law and other laws relating to
 simulcasting  and the imposition of certain taxes, as amended by section
 8 of part

S of chapter 61 of the laws of 2011, is  amended  to  read  as
 follows:

 

S  54.  This  act  shall  take  effect immediately; provided, however,
 sections three through twelve of this act shall take effect  on  January
 1, 1991, and section 1013 of the racing, pari-mutuel wagering and breed
 ing  law, as added by section thirty-eight of this act, shall expire and
 be deemed repealed on July 1, [2012] 2013; and section eighteen of  this
 act  shall take effect on July 1, 2008 and sections fifty-one and fifty
 two of this act shall take effect as of the same date as chapter 772  of
 the laws of 1989 took effect.
 

S  9.  Paragraph  (a)  of  subdivision 1 of section 238 of the racing,
 pari-mutuel wagering and breeding law, as amended by section 9 of part S
 of chapter 61 of the laws of 2011, is amended to read as follows:

 (a) The  franchised  corporation  authorized  under  this  chapter  to
 conduct pari-mutuel betting at a race meeting or races run thereat shall
 distribute  all sums deposited in any pari-mutuel pool to the holders of
 winning tickets therein, provided such tickets be presented for  payment
 before  April  first  of  the year following the year of their purchase,
 less an amount which shall be established and  retained  by  such  fran
 chised  corporation  of  between  twelve  to seventeen per centum of the
 total deposits in pools resulting from on-track regular bets, and  four
 teen  to  twenty-one per centum of the total deposits in pools resulting
 from on-track multiple bets and fifteen to twenty-five per centum of the
 total deposits in pools resulting from on-track exotic bets and  fifteen
 to  thirty-six  per centum of the total deposits in pools resulting from
 on-track super exotic bets, plus the breaks. The retention  rate  to  be
 established  is subject to the prior approval of the racing and wagering
 board. Such rate may not be changed more than once per calendar  quarter
 to  be effective on the first day of the calendar quarter. "Exotic bets"
 and "multiple bets" shall have the meanings set forth  in  section  five
 hundred  nineteen  of this chapter.   "Super exotic bets" shall have the
 meaning set forth in section three hundred  one  of  this  chapter.  For
 purposes  of  this  section, a "pick six bet" shall mean a single bet or
 wager on the outcomes of six races. The breaks are hereby defined as the
 odd cents over any multiple of five for payoffs greater than one  dollar
 five  cents  but  less  than  five dollars, over any multiple of ten for
 
       S. 6259--B                         47                         A. 9059--B
 payoffs greater than five dollars but  less  than  twenty-five  dollars,
 over  any  multiple  of twenty-five for payoffs greater than twenty-five
 dollars but less than two hundred fifty dollars, or over any multiple of
 fifty  for  payoffs over two hundred fifty dollars. Out of the amount so
 retained there shall be paid  by  such  franchised  corporation  to  the
 commissioner  of  taxation and finance, as a reasonable tax by the state
 for the privilege of conducting pari-mutuel betting on the races run  at
 the  race  meetings  held  by such franchised corporation, the following
 percentages of the total pool for regular and  multiple  bets  five  per
 centum  of regular bets and four per centum of multiple bets plus twenty
 per centum of the breaks; for  exotic  wagers  seven  and  one-half  per
 centum  plus  twenty per centum of the breaks, and for super exotic bets
 seven and one-half per centum plus fifty per centum of the  breaks.  For
 the  period  June  first, nineteen hundred ninety-five through September
 ninth, nineteen hundred ninety-nine, such tax on regular wagers shall be
 three per centum and such tax on multiple wagers shall be two  and  one
 half  per  centum,  plus twenty per centum of the breaks. For the period
 September tenth, nineteen  hundred  ninety-nine  through  March  thirty
 first,  two  thousand  one, such tax on all wagers shall be two and six
 tenths per centum and for the  period  April  first,  two  thousand  one
 through  December thirty-first, two thousand [twelve] THIRTEEN, such tax
 on all wagers shall be one and six-tenths per centum, plus, in each such
 period, twenty per centum of the breaks. Payment to the New  York  state
 thoroughbred  breeding  and  development  fund by such franchised corpo
 ration shall be one-half of one per centum of total daily on-track pari
 mutuel pools resulting from regular, multiple and exotic bets and  three
 per  centum  of super exotic bets provided, however, that for the period
 September tenth, nineteen  hundred  ninety-nine  through  March  thirty
 first,  two  thousand  one,  such payment shall be six-tenths of one per
 centum of regular, multiple and exotic pools and for  the  period  April
 first,  two  thousand  one  through  December thirty-first, two thousand
 [twelve] THIRTEEN, such payment shall be seven-tenths of one per  centum
 of such pools.
 

S  10. Subdivision 5 of section 1012 of the racing, pari-mutuel wager
 ing and breeding law, as amended by section 10 of part

S of  chapter  61
 of the laws of 2011, is amended to read as follows:

 5.  The  provisions  of this section shall expire and be of no further
 force and effect after June thirtieth, two thousand [twelve] THIRTEEN.
 

S 11. This act shall take effect immediately.
 PART P
 

Section 1. Subdivision 3 of section 205 of the tax law,  as  added  by
 section  8  of  part U1 of chapter 62 of the laws of 2003, is amended to
 read as follows:

 3. [From the] THE moneys collected from the taxes imposed by  sections
 one  hundred eighty-three and one hundred eighty-four of this article on
 and after April first,  two  thousand  [four]  TWELVE,  after  reserving
 amounts  for refunds or reimbursements, SHALL BE DISTRIBUTED AS FOLLOWS:

 twenty percent of such moneys shall be deposited to the  credit  of  the
 dedicated  highway  and bridge trust fund established by section eighty
 nine-b of the state finance law[. The remainder], FIFTY-FOUR PERCENT  OF
 SUCH  MONEYS  shall  be  deposited  in the mass transportation operating
 assistance fund to the credit of the  metropolitan  mass  transportation
 operating  assistance account created pursuant to section eighty-eight-a
 of the state finance law AND TWENTY-SIX PERCENT OF SUCH MONEYS SHALL  BE
 
       S. 6259--B                         48                         A. 9059--B
 DEPOSITED  IN  THE  MASS TRANSPORTATION OPERATING ASSISTANCE FUND TO THE
 CREDIT OF THE PUBLIC TRANSPORTATION SYSTEMS OPERATING ASSISTANCE ACCOUNT
 CREATED PURSUANT TO SECTION EIGHTY-EIGHT-A OF THE STATE FINANCE LAW.
 

S  2. This act shall take effect immediately and shall be deemed to be
 in full force and effect on and after April 1, 2012; provided,  however,
 that  the amendments to subdivision 3 of section 205 of the tax law made
 by section one of this act shall not affect the repeal of such  subdivi
 sion and shall be deemed to be repealed therewith.
 PART Q
 

Section  1. Subdivision (e) of section 1105 of the tax law, as amended
 by section 4 of part AA of chapter 57 of the laws of 2010, is amended to
 read as follows:

 (e) (1) The rent for every occupancy of a room or rooms in a hotel  in
 this  state,  except that the tax shall not be imposed upon (i) a perma
 nent resident, or (ii) where the rent is not more than at  the  rate  of
 two dollars per day.
 (2)  [When]  EXCEPT  AS  PROVIDED IN SUBDIVISION (R) OF SECTION ELEVEN
 HUNDRED ELEVEN OF THIS PART, WHEN occupancy is provided,  for  a  single
 consideration,  with property, services, amusement charges, or any other
 items, the separate sale of which is not subject to tax under this arti
 cle, the entire consideration shall be treated as rent  subject  to  tax
 under  paragraph  one of this subdivision; provided, however, that where
 the amount of the rent for occupancy is stated separately from the price
 of such property, services, amusement charges, or other  items,  on  any
 sales slip, invoice, receipt, or other statement given the occupant, and
 such  rent  is  reasonable  in  relation  to the value of such property,
 services, amusement charges or other items, only such separately  stated
 rent will be subject to tax under paragraph one of this subdivision.
 

S  2. 

Section 1111 of the tax law is amended by adding a new subdivi
 sion (r) to read as follows:

 (R) (1) IN REGARD TO THE COLLECTION OF SALES  TAX  ON  OCCUPANCIES  BY
 ROOM  REMARKETERS, WHEN OCCUPANCY IS PROVIDED FOR A SINGLE CONSIDERATION
 WITH PROPERTY, SERVICES, AMUSEMENT CHARGES, OR ANY OTHER ITEMS,  WHETHER
 OR  NOT  SUCH OTHER ITEMS ARE TAXABLE, THE RENT PORTION OF THE CONSIDER
 ATION FOR SUCH TRANSACTION SHALL BE  COMPUTED  AS  FOLLOWS:  EITHER  THE
 TOTAL  CONSIDERATION  RECEIVED  BY  THE  ROOM REMARKETER MULTIPLIED BY A
 FRACTION, THE NUMERATOR OF WHICH SHALL BE THE CONSIDERATION PAYABLE  FOR
 THE  OCCUPANCY BY THE ROOM REMARKETER AND THE DENOMINATOR OF WHICH SHALL
 BE SUCH CONSIDERATION PAYABLE FOR THE OCCUPANCY PLUS  THE  CONSIDERATION
 PAYABLE  BY  THE  REMARKETER  FOR  THE OTHER ITEMS BEING SOLD, OR BY ANY
 OTHER METHOD AS MAY BE AUTHORIZED  BY  THE  COMMISSIONER.  IF  THE  ROOM
 REMARKETER  FAILS TO SEPARATELY STATE THE TAX ON THE RENT SO COMPUTED ON
 A SALES SLIP, INVOICE, RECEIPT, OR OTHER STATEMENT GIVEN TO THE OCCUPANT
 IN THE MANNER PRESCRIBED BY PARAGRAPH TWO OF THIS SUBDIVISION  OR  FAILS
 TO  MAINTAIN  RECORDS  OF  THE PRICES OF ALL COMPONENTS OF A TRANSACTION
 COVERED BY THIS PARAGRAPH, THE ENTIRE CONSIDERATION SHALL BE TREATED  AS
 RENT  SUBJECT  TO  TAX UNDER PARAGRAPH ONE OF SUBDIVISION (E) OF SECTION
 ELEVEN HUNDRED FIVE OF THIS PART. NOTHING HEREIN SHALL BE  CONSTRUED  TO
 SUBJECT  TO  TAX OR EXEMPT FROM TAX ANY SERVICE OR PROPERTY OR AMUSEMENT
 CHARGE OR OTHER ITEMS OTHERWISE SUBJECT TO TAX OR EXEMPT FROM TAX  UNDER
 THIS ARTICLE OR PURSUANT TO THE AUTHORITY OF ARTICLE TWENTY-NINE OF THIS
 CHAPTER.  A  ROOM  REMARKETER'S RECORDS OF THE CONSIDERATION PAYABLE FOR
 ALL COMPONENTS OF A TRANSACTION COVERED BY THIS  PARAGRAPH  ARE  RECORDS
 
       S. 6259--B                         49                         A. 9059--B
 REQUIRED  TO  BE  MAINTAINED  FOR PURPOSES OF SUBDIVISION (A) OF SECTION
 ELEVEN HUNDRED THIRTY-FIVE OF THIS ARTICLE.
 (2)  IN  REGARD  TO THE COLLECTION OF SALES TAX ON OCCUPANCIES BY ROOM
 REMARKETERS, INCLUDING A TRANSACTION DESCRIBED IN PARAGRAPH ONE OF  THIS
 SUBDIVISION, THE REQUIREMENTS OF THE SECOND SENTENCE OF PARAGRAPH ONE OF
 SUBDIVISION  (A)  OF  SECTION  ELEVEN HUNDRED THIRTY-TWO OF THIS ARTICLE
 SHALL BE DEEMED SATISFIED IF THE REMARKETER GIVES THE CUSTOMER  A  SALES
 SLIP,  INVOICE,  RECEIPT,  OR  OTHER  STATEMENT OF THE PRICE ("INVOICE")
 PRIOR TO THE CUSTOMER'S COMPLETION OF HIS OR HER OCCUPANCY, ON WHICH THE
 AMOUNT OF TAX DUE UNDER THIS ARTICLE AND PURSUANT TO  THE  AUTHORITY  OF
 ARTICLE  TWENTY-NINE OF THIS CHAPTER IS STATED. THE ROOM REMARKETER MUST
 KEEP EITHER A COPY OF THE INVOICE AS  REQUIRED  BY  SUBDIVISION  (A)  OF
 SECTION  ELEVEN  HUNDRED  THIRTY-FIVE  OF  THIS  ARTICLE,  OR ELECTRONIC
 RECORDS THAT ACCURATELY REFLECT THE INFORMATION THAT IS ON  THE  INVOICE
 PROVIDED TO THE CUSTOMER.
 (3)  IN REGARD TO THE REPORTING AND THE PAYMENT TO THE COMMISSIONER BY
 ROOM REMARKETERS OF SALES TAX DUE ON  OCCUPANCIES,  SUBDIVISION  (A)  OF
 SECTION  ELEVEN  HUNDRED  THIRTY-SEVEN  OF THIS ARTICLE SHALL BE READ TO
 REQUIRE A ROOM REMARKETER TO REPORT SUCH SALES  TAX  DUE,  INCLUDING  IN
 REGARD  TO A TRANSACTION DESCRIBED IN PARAGRAPH ONE OF THIS SUBDIVISION,
 ON THE RETURN DUE FOR THE FILING PERIOD IN WHICH THE OCCUPANCY ENDS AND,
 AT THE TIME OF FILING SUCH RETURN, TO PAY TO THE COMMISSIONER THE  TOTAL
 AMOUNT DESCRIBED BY SUCH SUBDIVISION (A).
 

S  3.  Subdivision  (e)  of  section  1119 of the tax law, as added by
 section 5 of part AA of chapter 57 of the laws of 2010,  is  amended  to
 read as follows:

 (e)  Subject  to  conditions and limitations provided in this subdivi
 sion, a room remarketer shall be allowed a refund or credit against  the
 amount of tax collected and required to be remitted under section eleven
 hundred thirty-seven of this article in the amount of the tax it paid to
 an  operator  of a hotel under section eleven hundred four of this arti
 cle, where applicable, and subdivision (e)  of  section  eleven  hundred
 five of this article. Provided, however, that, in order to qualify for a
 refund  or  credit  under  this  subdivision for any sales tax quarterly
 period, the room remarketer must, for that quarter,  (1)  be  registered
 for  sales tax purposes under section eleven hundred thirty-four of this
 article; (2) collect the taxes imposed by section eleven hundred four of
 this article, where applicable, and subdivision (e)  of  section  eleven
 hundred five of this article; and (3) furnish the certificate of author
 ity  number  of  the  operator to whom the applicant paid the tax in its
 application for refund or credit  if  required  on  that  form  or  upon
 request.    PROVIDED THAT IF THE ROOM REMARKETER REQUESTS THE OPERATOR'S
 CERTIFICATE OF AUTHORITY NUMBER AND IS NOT PROVIDED  WITH  THAT  NUMBER,
 THE ROOM REMARKETER MAY SATISFY THIS REQUIREMENT BY PROVIDING THE OPERA
 TOR'S  NAME,  BUSINESS ADDRESS, TELEPHONE NUMBER, AND THE ADDRESS OF THE
 HOTEL WHERE THE OCCUPANCY TOOK PLACE. An application for refund or cred
 it under this subdivision must be filed with the commissioner within the
 time provided by subdivision (a) of section eleven  hundred  thirty-nine
 of  this  article. The application must be in the form prescribed by the
 commissioner. Where an application for credit has been filed, the appli
 cant may immediately take the credit on the return that is  due  coinci
 dent with or immediately subsequent to the time that the applicant files
 the  application  for  credit.  However, the taking of the credit on the
 return is deemed to be part of the application for credit. The procedure
 for granting or denying the applications for refund or credit and review
 of those determinations shall be  as  provided  in  subdivision  (e)  of
 
       S. 6259--B                         50                         A. 9059--B
 section eleven hundred thirty-nine of this article. An operator, includ
 ing  a  room  remarketer, who is paid tax by a room remarketer must upon
 request provide the remarketer with its certificate of authority number,
 provided  that  the  operator's  failure  to  do  so does not change the
 requirement set forth in paragraph three of this subdivision.
 

S 4. Paragraph 4 of subdivision a of section 11-2502 of  the  adminis
 trative code of the city of New York, as amended by section 8 of part AA
 of chapter 57 of the laws of 2010, is amended to read as follows:

 (4)  (I)  When occupancy is provided, for a single consideration, with
 property, services, amusement charges, or any other items, the  separate
 sale  of  which  is  not  subject  to tax under this chapter, the entire
 consideration shall be treated as rent subject to  tax  under  paragraph
 one of this subdivision; provided, however, that where the amount of the
 rent for occupancy is stated separately from the price of such property,
 services,  amusement  charges or other items on any sales slip, invoice,
 receipt, or other statement given the occupant and such rent is  reason
 able  in  relation  to  the  value of such property, services, amusement
 charges, or other items,  only  such  separately  stated  rent  will  be
 subject to tax under [paragraph one of] this subdivision.
 (II) IN REGARD TO THE COLLECTION OF TAX ON OCCUPANCIES BY REMARKETERS,
 WHEN  OCCUPANCY  IS PROVIDED, FOR A SINGLE CONSIDERATION, WITH PROPERTY,
 SERVICES, AMUSEMENT CHARGES, OR ANY OTHER ITEMS,  WHETHER  OR  NOT  SUCH
 OTHER  ITEMS ARE TAXABLE, THE RENT PORTION OF THE CONSIDERATION FOR SUCH
 SALE SHALL BE COMPUTED AS FOLLOWS: THE TOTAL CONSIDERATION FOR THE  SALE
 MULTIPLIED  BY A FRACTION, THE NUMERATOR OF WHICH SHALL BE THE CONSIDER
 ATION PAID TO THE HOTEL FOR THE OCCUPANCY AND THE DENOMINATOR  OF  WHICH
 SHALL  BE THE CONSIDERATION PAID TO THE HOTEL FOR THE OCCUPANCY PLUS THE
 CONSIDERATION PAID TO THE PROVIDERS OF THE OTHER ITEMS BEING SOLD, OR BY
 ANY OTHER REASONABLE METHOD  PURSUANT  TO  WHICH  THE  RENT  PORTION  OF
 CONSIDERATION  WOULD  BE NO LESS THAN THE COMPUTATION OF RENT PORTION OF
 CONSIDERATION UNDER SUBPARAGRAPH (I) OF THIS PARAGRAPH.  NOTHING  HEREIN
 SHALL  BE  CONSTRUED TO SUBJECT TO TAX OR EXEMPT FROM TAX ANY SERVICE OR
 PROPERTY OR AMUSEMENT CHARGE OR OTHER ITEMS OTHERWISE SUBJECT TO TAX  OR
 EXEMPT FROM TAX UNDER THIS CHAPTER.
 

S  5.  Paragraph 5 of subdivision a of section 11-2502 of the adminis
 trative code of the city of New York, as amended by section 8 of part AA
 of chapter 57 of the laws of 2010, is amended to read as follows:

 (5) A room remarketer shall be allowed a refund or credit against  the
 taxes  collected and required to be remitted pursuant to section 11-2505
 of this chapter in the amount of the tax it paid to the operator of  the
 hotel  or another room remarketer under [paragraph three of] this subdi
 vision. Provided, however, that in order to  qualify  for  a  refund  or
 credit  under  this  paragraph  with respect to any quarterly period, as
 described in subdivision a of section 11-2504 of this chapter, the  room
 remarketer  must,  with  respect  to such quarter, (i) be registered for
 hotel room occupancy tax purposes under section 11-2514 of this chapter,
 and (ii) collect the taxes imposed by paragraphs two and three  of  this
 subdivision.  Subject  to  the  conditions and limitations of this para
 graph, the provisions of section 11-2507 of this chapter shall apply  to
 refunds or credits under this paragraph.
 

S  6.  Subdivision  f of section 11-2502 of the administrative code of
 the city of New York, as amended by local law number 43 of the  city  of
 New York for the year 2009 and paragraph 2 as renumbered by section 9 of
 part  AA  of  chapter  57  of  the  laws  of 2010, is amended to read as
 follows:

 
       S. 6259--B                         51                         A. 9059--B
 f. The tax to be collected shall be stated  [and  charged]  separately
 from  the  rent [and shown separately on any record thereof, at the time
 when the occupancy is arranged or contracted for  and  charged  for  and
 upon every evidence of occupancy or any bill or statement or charge made
 for said occupancy issued or delivered by the operator or room remarket-
 er]  ON  A SALES SLIP, INVOICE, RECEIPT, OR OTHER STATEMENT OF THE PRICE
 ("INVOICE") GIVEN TO THE OCCUPANT PRIOR TO THE OCCUPANT'S COMPLETION  OF
 HIS  OR HER OCCUPANCY AND BE VERIFIABLE FROM THE BOOKS AND RECORDS OF AN
 OPERATOR OR ROOM REMARKETER RESPONSIBLE FOR COLLECTING AND REMITTING THE
 TAX.
 (1) Where an occupant rents a room directly from an operator, the  tax
 shall  be  paid  by  the  occupant to the operator as trustee for and on
 account of the city, and the operator shall be liable for the collection
 of the tax on the rent and for the payment of the tax on the rent.
 (2) The operator or room remarketer and any officer of  any  corporate
 operator  or  room remarketer shall be personally liable for the portion
 of the tax collected or required to be collected under this chapter, and
 the operator shall have the same right in respect to collecting the  tax
 from  the  occupant, or in respect to nonpayment of the tax by the occu
 pant as if the tax were a part of the rent for the occupancy payable  at
 the  time  such  tax shall become due and owing, including all rights of
 eviction, dispossession, repossession and enforcement of any innkeeper's
 lien that he or she may have in the event of nonpayment of rent  by  the
 occupant;  provided  however,  that the commissioner of finance shall be
 joined as a party in any action or proceeding brought by the operator to
 collect or enforce collection of the tax.
 

S 7. This act shall take effect September 1, 2012 and shall  apply  to
 occupancies that commence on or after such date.
 

S 2. Severability clause. If any clause, sentence, paragraph, subdivi
 sion,  section  or  part  of  this act shall be adjudged by any court of
 competent jurisdiction to be invalid, such judgment  shall  not  affect,
 impair,  or  invalidate  the remainder thereof, but shall be confined in
 its operation to the clause, sentence, paragraph,  subdivision,  section
 or part thereof directly involved in the controversy in which such judg
 ment shall have been rendered. It is hereby declared to be the intent of
 the  legislature  that  this  act  would  have been enacted even if such
 invalid provisions had not been included herein.
 

S 3. This act shall take effect immediately  provided,  however,  that
 the  applicable effective date of Parts A through Q of this act shall be
 as specifically set forth in the last section of such Parts.

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