senate Bill S4736A

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:
A8019A
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:S4736A

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 eight-fold
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, 2012; provided,
however, that if this act shall not have become a law on or before
July 1, 2012, then this act shall take effect immediately and shall
be deemed to have been in full force and effect on and after July 1,
2012.

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

                                 4736--A

                       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 -- recommitted to the Committee on Investigations  and
  Government  Operations  in  accordance  with  Senate Rule 6, sec. 8 --
  committee discharged, bill amended, ordered reprinted as  amended  and
  recommitted to said committee

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

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09473-02-2

S. 4736--A                          2

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-
ness by the agent" referred to in  paragraphs  two  and  three  of  this
subdivision.
  S  2. This act shall take effect July 1, 2012; provided, however, that
if this act shall not have become a law on or before July 1, 2012,  then
this  act shall take effect immediately and shall be deemed to have been
in full force and effect on and after July 1, 2012.

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