senate Bill S4736

Amended

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

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 18 / Apr / 2011
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 21 / Jun / 2011
    • COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • 21 / Jun / 2011
    • ORDERED TO THIRD READING CAL.1469
  • 21 / Jun / 2011
    • PASSED SENATE
  • 21 / Jun / 2011
    • DELIVERED TO ASSEMBLY
  • 21 / Jun / 2011
    • REFERRED TO WAYS AND MEANS
  • 04 / Jan / 2012
    • DIED IN ASSEMBLY
  • 04 / Jan / 2012
    • RETURNED TO SENATE
  • 04 / Jan / 2012
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 09 / Jan / 2012
    • AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 09 / Jan / 2012
    • PRINT NUMBER 4736A
  • 22 / May / 2012
    • REPORTED AND COMMITTED TO FINANCE
  • 12 / Jun / 2012
    • COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • 12 / Jun / 2012
    • ORDERED TO THIRD READING CAL.1192
  • 12 / Jun / 2012
    • PASSED SENATE
  • 12 / Jun / 2012
    • DELIVERED TO ASSEMBLY
  • 12 / Jun / 2012
    • REFERRED TO WAYS AND MEANS

Summary

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

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Bill Details

See Assembly Version of this Bill:
A8019
Versions:
S4736
S4736A
Legislative Cycle:
2011-2012
Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd ยง483, Tax L
Versions Introduced in 2009-2010 Legislative Cycle:
S8428, S8428

Sponsor Memo

BILL NUMBER:S4736

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

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

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

Section 2: Effective date.

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

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

PRIOR LEGISLATIVE HISTORY:
New bill.

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


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

EFFECTIVE DATE:
This act shall take effect July 1, 2011; provided,
however, that if this act shall not have become a law on or before
July 1, 2011, then this act shall take effect immediately and shall
be deemed to have been in full force and effect on and after July 1,
2011.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  4736

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                             April 18, 2011
                               ___________

Introduced  by  Sen.  GOLDEN -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the tax law, in  relation  to  increasing  the  presumed
  "cost of the agent" relating to cigarette marketing standards

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

  Section 1. Subparagraph (B) of  paragraph  1  of  subdivision  (b)  of
section 483 of the tax law, as amended by chapter 1 of the laws of 1999,
is amended to read as follows:
  (B) In the absence of the filing with the commissioner of satisfactory
proof  of  a lesser cost of doing business of the agent making the sale,
the cost of doing business by the agent shall be presumed to  be  seven-
eighths  of  one  percent  of  the basic cost of cigarettes for sales to
wholesale dealers plus [one cent] SEVEN CENTS per package of  ten  ciga-
rettes, [two] FOURTEEN cents per package of twenty cigarettes and in the
case  of  a package containing more than twenty cigarettes, [two] SEVEN-
TEEN cents and one-half of a cent for each five cigarettes in excess  of
twenty  cigarettes,  one and one-half percent of the basic cost of ciga-
rettes for sales to chain stores plus [one cent] SIX CENTS  per  package
of  ten  cigarettes, [two] TWELVE cents per package of twenty cigarettes
and in the case of a package containing  more  than  twenty  cigarettes,
[two] SEVENTEEN cents and one-half of a cent for each five cigarettes in
excess  of  twenty cigarettes and three and seven-eighths percent of the
basic cost of cigarettes with respect to sales to  retail  dealers  plus
[one  cent]  SIX CENTS per package of ten cigarettes, [two] TWELVE cents
per package of twenty cigarettes and in the case of a package containing
more than twenty cigarettes, [two] SEVENTEEN cents  and  one-half  of  a
cent  for  each  five  cigarettes in excess of twenty cigarettes and the
foregoing cents per pack shall be included in the "cost of  doing  busi-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09473-01-1

S. 4736                             2

ness  by  the  agent"  referred  to  in paragraphs two and three of this
subdivision.
  S  2. This act shall take effect July 1, 2011; provided, however, that
if this act shall not have become a law on or before July 1, 2011,  then
this  act shall take effect immediately and shall be deemed to have been
in full force and effect on and after July 1, 2011.

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