senate Bill S4943

When external indices are utilized to determine sales and use tax due, requires such indices to reflect local economic conditions

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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

  • 02 / May / 2011
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 07 / Jun / 2011
    • REPORTED AND COMMITTED TO FINANCE
  • 13 / Jun / 2011
    • COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • 14 / Jun / 2011
    • ORDERED TO THIRD READING CAL.1242
  • 16 / Jun / 2011
    • PASSED SENATE
  • 16 / Jun / 2011
    • DELIVERED TO ASSEMBLY
  • 16 / 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
  • 18 / Apr / 2012
    • REPORTED AND COMMITTED TO FINANCE
  • 08 / May / 2012
    • 1ST REPORT CAL.731
  • 09 / May / 2012
    • 2ND REPORT CAL.
  • 14 / May / 2012
    • ADVANCED TO THIRD READING
  • 15 / May / 2012
    • PASSED SENATE
  • 15 / May / 2012
    • DELIVERED TO ASSEMBLY
  • 15 / May / 2012
    • REFERRED TO WAYS AND MEANS

Summary

Requires the commissioner of taxation and finance, when using external indices to determine sales and compensating use tax due because of failure to file a return or filing of an incorrect return, to use external indices which reflect local economic conditions.

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Bill Details

See Assembly Version of this Bill:
A8129
Versions:
S4943
Legislative Cycle:
2011-2012
Current Committee:
Law Section:
Tax Law
Laws Affected:
Amd ยง1138, Tax L

Sponsor Memo

BILL NUMBER:S4943

TITLE OF BILL:
An act
to amend the tax law, in relation to the determination of sales and
compensating use taxes due

PURPOSE:
This bill would require that any external economic indices used by the
Department of Taxation and Finance in estimating sales tax payments
due must utilize regional economic indices to reflect the wide
variation of the costs of goods and services sold throughout the state.

SUMMARY OF PROVISIONS:
This bill would amend subdivision (a) of section 1138 of the tax law
by adding a new paragraph (5) to require that whenever the
Commissioner of Taxation and Finance is determining the amount of
sales t.ax owed, in instances in where a required sales tax filing
has not been made or there has been an incorrect or insufficient
sales tax payment, the Commissioner must utilize a regional economic
index to estimating the correct tax payment to be made.

JUSTIFICATION:
New York State has hired hundreds of new auditors over the past few
years and unleashed them on unsuspecting taxpayers. Thousands of
retail merchants across the state have been subject to new audit
tactics apparently designed to generate as much revenue as possible.
The most insidious of these tactics is the practice of determining a
merchant's sales tax assessment based on external indices rather than
the merchant's records. Often times the external indices are not based
on local standards thereby leading to drastically distorted
assessments far exceeding any reasonable estimate. One of the most
common indices used by the Department is based on an analysis of less
than 100 businesses. The Department continues to use this index in
spite of a specific note by the study's authors that it is not
statically reliable for such purposes. This bill would prohibit the
Department of Tax and Finance from using any external index that does
not reflect local economic conditions. It ensures that anytime a
sales tax assessment is imposed on a retail merchant not based on the
merchant's records it will be more fair since the merchant's local
area will be the basis of comparison.
These business owners are the backbone of the state's economy and
deserve to have their taxes determined in a fair manner. This bill
will restore fairness to the tax assessment process and help retail
merchants in New York live up to their legitimate tax assessments.

LEGISLATIVE HISTORY:
New Bill.

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
This act shall take effect immediately.


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

                                  4943

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                               May 2, 2011
                               ___________

Introduced  by  Sen.  YOUNG  -- 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 determination  of  sales
  and compensating use taxes due

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

  Section 1. Subdivision (a) of section 1138 of the tax law  is  amended
by adding a new paragraph 5 to read as follows:
  (5)  WHENEVER  A RETURN REQUIRED BY THIS ARTICLE IS NOT FILED, OR IF A
RETURN WHEN FILED IS INCORRECT OR INSUFFICIENT, AND THE  AMOUNT  OF  TAX
DUE  IS  DETERMINED  BY THE COMMISSIONER FROM SUCH INFORMATION AS MAY BE
AVAILABLE PURSUANT TO PARAGRAPH ONE OF THIS SUBDIVISION, ANY    EXTERNAL
INDICES  USED  TO  ESTIMATE THE TAX DUE SHALL REFLECT THE LOCAL ECONOMIC
CONDITIONS.
  S 2. This act shall take effect immediately.






 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11110-01-1

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