This bill has been amended

Bill S7219-2011

Reduces the tax on motor fuel; does away with state sales tax and petroleum business tax on motor fuel

Repeals article 12-A of the tax law in relation to taxes on gasoline and similar motor fuel; establishes exemptions from state sales tax and the petroleum business tax for retail sales of motor fuel and diesel motor fuel; provides for the regulation of motor fuel distributors, importing transporters and terminal operators by the department of state.

Details

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Actions

  • May 2, 2012: REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Memo

BILL NUMBER:S7219

TITLE OF BILL: An act to amend the tax law, in relation to taxes on motor fuels

PURPOSE: To remove various taxes on motor fuel, saving consumers 34 cents per gallon of gas.

SUMMARY OF SPECIFIC PROVISIONS: Section 1 of the bill amends tax law to reduce the tax on motor fuel. Section 2 of this bill amends the tax law to reduce the tax on motor fuel. Section 3 of this amends the tax law to reduce the tax on gasoline. Section 4 of this bill adds retail sales of motor vehicle fuel and diesel motor fuel to the list of sales tax exemptions. Section 5 amends the tax law to clarify that this section shall not apply to motor fuel and diesel motor fuel. Section 6 clarifies that this language does not relate to localities. Section 7 clarifies that this section does not relate to municipalities. Section 8 clarifies that motor fuel and diesel motor fuel exemption shall not apply. Section 9 makes clarifications as they relate to businesses. Section 10 is the effective date.

JUSTIFICATION: New York State has the highest gas tax in the country, individuals purchasing gas are taxed at the Federal, State, and Local level. This legislation repeals three state mandated taxes: State Petroleum Business Tax, State Motor Fuel Excise tax, and the State Sales Tax. When taken in totality these taxes equal 34 cents per gallon. New York residents are over taxed and overburdened, removing these taxes will help to alleviate a tax burden that is borne both by business and the individual. New York state should be looking at ways to reduce the tax burden on individuals, while reducing the cost of government.

PRIOR LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: $2.2 billion.

EFFECTIVE DATE: This act shall take effect January 1, 2013.


Text

STATE OF NEW YORK ________________________________________________________________________ 7219 IN SENATE May 2, 2012 ___________
Introduced by Sen. GRISANTI -- 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 taxes on motor fuels THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 1 of section 284 of the tax law, as amended by chapter 276 of the laws of 1986, is amended to read as follows: 1. There is hereby levied and imposed an excise tax of [four cents] THREE-FOURTHS OF ONE CENT per gallon upon motor fuel (a) imported into or caused to be imported into the state by a distributor for use, distribution, storage or sale in the state or upon motor fuel which is produced, refined, manufactured or compounded by a distributor in the state (which acts shall hereinafter in this subdivision be encompassed by the phrase "imported or manufactured") or (b) if the tax has not been imposed prior to its sale in this state, which is sold by a distributor (which act, in conjunction with the acts described in paragraph (a) of this subdivision, shall hereinafter in this article be encompassed by the phrase "imported, manufactured or sold"), except when imported, manufactured or sold 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 or when imported or manufac- tured by an organization described in paragraph one or two of subdivi- sion (a) of section eleven hundred sixteen of this chapter or a hospital included in the organizations described in paragraph four of such subdi- vision for its own use or consumption and except kero-jet fuel when imported or manufactured by an airline for use in its airplanes. Provided, further, no motor fuel shall be included in the measure of the tax unless it shall have previously come to rest within the meaning of federal decisional law interpreting the United States constitution. All tax for the period for which a return is required to be filed shall be due on the date limited for the filing of the return for such period, regardless of whether a return is filed by such distributor as required
by this article or whether the return which is filed correctly shows the amount of tax due. S 2. Section 284-a of the tax law, as amended by section 3 of part EE of chapter 63 of the laws of 2000, is amended to read as follows: S 284-a. Additional motor fuel tax. In addition to the tax imposed by section two hundred eighty-four of this [chapter] ARTICLE, a like tax shall be imposed at the rate of [three cents] THREE-FOURTHS OF ONE CENT per gallon upon motor fuel imported, manufactured or sold within this state by a distributor. Except as otherwise provided in this section, all the provisions of this article except subdivision two of section two hundred eighty-nine-e of this article shall apply with respect to the additional tax imposed by this section to the same extent as if it were imposed by said section two hundred eighty-four. [Beginning on April first, nineteen hundred ninety-one, four and one-sixth per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited to the credit of the emergency highway recon- ditioning and preservation fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty- nine of the state finance law. Beginning on April first, nineteen hundred ninety-one, four and one-sixth per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited to the credit of the emergency highway construction and recon- struction fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty-nine-a of the state finance law. Beginning on April first, nineteen hundred ninety-two, an additional eight and one-third per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited to the credit of the emergency highway reconditioning and preservation fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty-nine of the state finance law. Beginning on April first, nineteen hundred ninety-two, an additional eight and one-third per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited to the credit of the emergency highway construction and reconstruction fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty-nine-a of the state finance law. Beginning on April first, two thousand, seventy-five per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited in the dedicated fund accounts pursuant to subdivision (d) of section three hundred one-j of this chapter.] Begin- ning on April first, two thousand three, all of the moneys received by the department pursuant to the provisions of this section shall be deposited in the dedicated fund accounts pursuant to subdivision (d) of section three hundred one-j of this chapter. S 3. Section 284-c of the tax law, as amended by section 4 of part EE of chapter 63 of the laws of 2000, is amended to read as follows: S 284-c. Supplemental motor fuel tax. In addition to the taxes imposed by sections two hundred eighty-four and two hundred eighty-four-a of this [chapter] ARTICLE, a like tax shall be imposed at the rate of ONE- HALF OF one cent per gallon upon motor fuel imported, manufactured or sold within this state by a distributor. Except for paragraph (b) of subdivision three of section two hundred eighty-nine-c OF THIS ARTICLE, all the provisions of this article shall apply with respect to the supplemental tax imposed by this section to the same extent as if it were imposed by said section two hundred eighty-four. [On and after the first day of October, nineteen hundred seventy-two, twenty-five per
centum of the monies received by the department pursuant to the provisions of this section shall be deposited to the credit of the emer- gency highway reconditioning and preservation fund established pursuant to the provisions of section eighty-nine of the state finance law. Beginning on April first, nineteen hundred eighty-three, twenty-five per centum of the monies received by the department pursuant to the provisions of this section shall be deposited to the credit of the emer- gency highway construction and reconstruction fund established pursuant to the provisions of section eighty-nine-a of the state finance law. Beginning on April first, nineteen hundred ninety, an additional twelve and one-half per centum of the monies received by the department pursu- ant to the provisions of this section shall be deposited to the credit of the emergency highway reconditioning and preservation fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty-nine of the state finance law. Begin- ning on April first, nineteen hundred ninety, an additional twelve and one-half per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited to the credit of the emergency highway construction and reconstruction fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty-nine-a of the state finance law. Beginning on April first, nineteen hundred ninety-one, an additional twelve and one- half per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited to the credit of the emer- gency highway reconditioning and preservation fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty-nine of the state finance law. Beginning on April first, nineteen hundred ninety-one, an additional twelve and one-half per centum of the moneys received by the department pursuant to the provisions of this section shall be deposited to the credit of the emer- gency highway construction and reconstruction fund reserve account established pursuant to the provisions of paragraph (b) of subdivision two of section eighty-nine-a of the state finance law.]
Beginning on April first, two thousand three, all of the moneys received by the department pursuant to the provisions of this section shall be deposited in the dedicated fund accounts pursuant to subdivision (d) of section three hundred one-j of this chapter. S 4. Subdivision (a) of section 1115 of the tax law is amended by adding a new paragraph 44 to read as follows: (44) RETAIL SALES OF MOTOR FUEL AND DIESEL MOTOR FUEL. S 5. Subdivision (b) of section 1107 of the tax law is amended by adding a new clause 12 to read as follows: (12) EXCEPT AS OTHERWISE PROVIDED BY LAW, THE EXEMPTION PROVIDED IN PARAGRAPH FORTY-FOUR OF SUBDIVISION (A) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS ARTICLE RELATING TO MOTOR FUEL AND DIESEL MOTOR FUEL SHALL NOT APPLY. S 6. 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, 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. EXCEPT AS OTHERWISE PROVIDED BY LAW, 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 AUTHORIZED BY THIS SUBDI- VISION, SHALL OMIT THE MOTOR FUEL AND DIESEL MOTOR FUEL EXEMPTION PROVIDED FOR IN PARAGRAPH FORTY-FOUR OF SUBDIVISION (A) OF SUCH SECTION ELEVEN HUNDRED FIFTEEN. S 7. Subdivision (m) of section 1111 of the tax law, as amended by section 1 of part M1 of chapter 109 of the laws of 2006, paragraph 7 as amended by section 11 of subpart I of part V1 of chapter 57 of the laws of 2009, is amended to read as follows: (m) Notwithstanding any provision of law to the contrary: [(1) The sales tax imposed by subdivision (a) of section eleven hundred five of this article and the compensating use tax imposed by section eleven hundred ten of this article, in regard to retail sales of motor fuel and diesel motor fuel, shall be eight cents per gallon.] (2) The sales and compensating use taxes imposed by subdivision (a) of section eleven hundred nine of this article, in regard to retail sales of motor fuel and diesel motor fuel, shall be three-quarters of one cent per gallon. (3) [Paragraph one of this subdivision shall not apply to the sales and compensating use taxes imposed by subdivision (a) of section eleven hundred seven of this article in regard to retail sales of motor fuel and diesel motor fuel. However, the] THE legislative body of a city in which the taxes imposed by such section eleven hundred seven are in effect, by local law, ordinance, or resolution in exactly the form prepared by the commissioner, may elect that such taxes, in regard to retail sales of motor fuel and diesel motor fuel, shall be computed, as
determined by the commissioner, at a rate of cents per gallon, rounded to the nearest cent, equal to two or three dollars, as determined by the municipality, multiplied by the percentage rate of such taxes within the municipality. (4) [Paragraph one of this subdivision shall not apply to the sales and compensating use taxes imposed by a local law, ordinance or resol- ution of a municipality pursuant to the authority of subpart B of part one of article twenty-nine of this chapter, in regard to retail sales of motor fuel and diesel motor fuel.] The legislative body of [such] a municipality, by local law, ordinance or resolution in exactly the form prepared by the commissioner, PURSUANT TO THE AUTHORITY OF SUBPART B OF PART ONE OF ARTICLE TWENTY-NINE OF THIS CHAPTER, may elect that its sales and compensating use taxes, in regard to the retail sale of motor fuel and diesel motor fuel, shall be computed, as determined by the commissioner, at a rate of cents per gallon, rounded to the nearest cent, equal to two or three dollars, as determined by the municipality, multiplied by the percentage rate of such taxes within the municipality. (5)(i) Prior to the start of any sales tax quarter, the commissioner shall apply the local percentage sales tax rate of each county or city that has elected a cents per gallon rate pursuant to paragraph three or four of this subdivision to the average price of motor fuel and diesel motor fuel, not including sales tax and the motor fuel excise tax, for three consecutive months beginning four months prior to the start of any sales tax quarter. If the result of this computation is less than the elected cents per gallon rate for a county or city, the cents per gallon rate for such county or city shall be adjusted to be equal to such computation, rounded to the nearest one cent. Such rates shall be published by the commissioner and effective in the next succeeding sales tax quarter. (ii) Prior to the start of any sales tax quarter, the commissioner shall also adjust in a like manner the cents per gallon rates prescribed by [paragraphs one and] PARAGRAPH two of this subdivision based on percentage sales tax [rates] RATE of [four percent and] three-eighths of a percent [respectively]. Provided, however, adjustments made to the cents per gallon rate prescribed by paragraph two of this subdivision shall be rounded to the nearest one-tenth of one cent. (6) A local law, ordinance or resolution making or revoking the election made pursuant to paragraph three or four of this subdivision must go into effect in accordance with the provisions of subdivisions (d) and (e) of section twelve hundred ten of this chapter. (7) Notwithstanding any foregoing provision of this subdivision or other law to the contrary, this subdivision, subdivision (h) of section eleven hundred nine of this part and subdivision (n) of section eighteen hundred seventeen of this chapter, section three hundred ninety-two-i of the general business law and other provisions of law which refer or relate to this subdivision shall apply only to (A) motor fuel or diesel motor fuel sold for use directly and exclusively in the engine of a motor vehicle and (B) motor fuel or diesel motor fuel, other than water-white kerosene sold exclusively for heating purposes in containers of no more than twenty gallons, sold by a retail gas station. For purposes of this subdivision and such other provisions of law, "retail gas station" shall mean a filling station where such fuel is stored primarily for sale by delivery directly into the ordinary fuel tank connected with the engine of a motor vehicle to be consumed in the oper- ation of such motor vehicle or where such fuel is stored primarily for sale by delivery directly into the ordinary fuel tank connected with the
engine of a vessel to be consumed in the operation of such vessel. The commissioner is hereby authorized to require the use of certificates or other documents, and procedures related thereto, to effect the purposes of this subdivision; and any such certificate or other document so required by the commissioner for a purchaser to tender to a vendor to purchase such fuel subject to tax on the reduced base established by or pursuant to this subdivision is hereby deemed to be an exemption certif- icate as such term is used in subdivision (c) of section eleven hundred thirty-two of this article and as if the provisions of such subdivision (c) referred to such a certificate or document required pursuant to this subdivision. S 8. Paragraph 1 of subdivision (h) of section 1109 of the tax law, as amended by section 2 of part M1 of chapter 109 of the laws of 2006, is amended to read as follows: (1) EXCEPT AS OTHERWISE PROVIDED BY LAW, THE EXEMPTION CONTAINED IN PARAGRAPH FORTY-FOUR OF SUBDIVISION (A) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS ARTICLE RELATING TO MOTOR FUEL AND DIESEL MOTOR FUEL SHALL NOT APPLY. The commissioner shall determine and certify to the comptroller the amount of revenue foregone as a result of the cents per gallon tax in paragraph two of subdivision (m) of section eleven hundred eleven of this part in lieu of tax at the rate provided in subdivision (a) of this section. S 9. Subdivision (a) of section 301-a of the tax law, as amended by section 19 of part K of chapter 61 of the laws of 2011, is amended to read as follows: (a) General. Notwithstanding any other provision of this chapter, or of any other law, there is hereby imposed upon every petroleum business for the privilege of engaging in business, doing business, employing capital, owning or leasing property, or maintaining an office in this state, OTHER THAN A PETROLEUM BUSINESS MAKING A RETAIL SALE NOT IN BULK OF MOTOR FUEL OR HIGHWAY DIESEL MOTOR FUEL IN THE STATE, a monthly tax for each or any part of a taxable month equal to the sum of the motor fuel component determined pursuant to subdivision (b) of this section, the highway diesel motor fuel component determined pursuant to paragraph one of subdivision (c) of this section, the non-highway diesel motor fuel component determined pursuant to paragraph two of subdivision (c) of this section and the residual petroleum product component determined pursuant to subdivision (d) of this section. S 10. This act shall take effect January 1, 2013.

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