Provides that the sales tax exemption for coin operated car wash facilities shall apply to those facilities which may be operated by a credit or debit card.
TITLE OF BILL: An act to amend the tax law, in relation to the sales tax exemption for car wash facilities
PURPOSE: To expand the sales tax exemption for coin-operated car wash services to authorize the exemption where payment is made by credit or debit card.
JUSTIFICATION: Under current law, coin-operated car wash services are exempt from sales tax. "Coin-operated" is defined to include coin-operated, currency-operated or token operated, but does not include credit or debit card machine transactions. If a coin-operated car wash business adds equipment to authorize payment by credit or debit card, then the coin operated services are not subject to sales tax under current law, but the services paid for through the credit or debit card machine are subject to sales tax. This requires a separate accounting for the credit or debit card transactions, with the associated additional burdens for the car wash business owner. Car wash businesses install credit or debit card machines as a convenience to consumers and they should not be required to pay sales tax on these services, which would otherwise be exempt from sales taxation, because they are offering a more modem mode of payment as a convenience to the consumer.
In addition, when sales tax is required to be paid on car wash services paid for through credit or debit card machines, the car wash business is subject to double taxation because it must also pay sales tax on the products and equipment purchased to provide the car wash. It is inequitable to tax these small businessmen at two levels in the chain of commerce and this bill would remedy this inequity.
LEGISLATIVE HISTORY: A.4668 of 2011/2012: referred to ways and means A.4757 of 2009/2010: referred to ways and means 2007/2008: Veto Memo 41
FISCAL IMPLICATIONS: Undetermined.
EFFECTIVE DATE: This act shall take effect on the first day of a sales tax quarterly period as described in subdivision (b) of section 1136 of the tax law, occurring at least sixty days after this act shall have become a law.
STATE OF NEW YORK ________________________________________________________________________ 6597 IN SENATE February 11, 2014 ___________Introduced by Sen. SEWARD -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Govern- ment Operations AN ACT to amend the tax law, in relation to the sales tax exemption for car wash facilities THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraph 3 of subdivision (t) of section 1115 of the tax law, as amended by chapter 489 of the laws of 2003, is amended to read as follows: (3) For purposes of this subdivision, the term "coin-operated" includes coin-operated, currency-operated
[or], token-operated OR OPER- ATED BY A CREDIT OR DEBIT CARD MACHINE and the term "motor vehicle" shall mean a motor vehicle as defined in subdivision (f) of section eleven hundred thirty-two of this article. S 2. This act shall take effect on the first day of a sales tax quar- terly period as described in subdivision (b) of section 1136 of the tax law, occurring at least sixty days after this act shall have become a law.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD10928-01-3