senate Bill S4944

Establishes a recordkeeping voluntary compliance program with regard to sales tax liability

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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
  • 04 / Jan / 2012
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Summary

Establishes a recordkeeping voluntary compliance program with regard to sales tax liability.

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Bill Details

See Assembly Version of this Bill:
A8069
Versions:
S4944
Legislative Cycle:
2011-2012
Current Committee:
Senate Investigations And Government Operations
Law Section:
Tax Law
Laws Affected:
Add §1135-a, amd §1138, Tax L

Votes

7
0
7
Aye
0
Nay
1
aye with reservations
0
absent
0
excused
0
abstained
show Investigations and Government Operations committee vote details

Sponsor Memo

BILL NUMBER:S4944

TITLE OF BILL:
An act
to amend the tax law, in relation to establishing the recordkeeping
voluntary compliance program for purposes of sales tax liability

PURPOSE:
This bill would adds a new section 1135-a to the tax law to require
the establishment of a sales tax recordkeeping voluntary compliance
program which will provide an incentive for taxpayers to facilitate
and modernize their recordkeeping ability for purposes of complying
with the state sales tax law.

SUMMARY OF PROVISIONS:
This bill would add a new section 1135-a to the tax law to require
that the Commissioner of Taxation and Finance develop and administer
a voluntary recordkeeping sales tax compliance program which would
allow the Commissioner to enter into agreements with eligible
taxpayers and require that they maintain books and records for
purposes of complying with the sales tax in the future which may
include, but is not limited to the use of a point of sale system.

A new tax law section 1138 is also added to provide that a taxpayer
who is a party to a recordkeeping voluntary compliance agreement may
not be subject to an estimation of sales taxes due which is based
upon the department's use of external indices, unless the taxpayer
is in substantial non-compliance with the voluntary recordkeeping
agreement.

JUSTIFICATION:
New York State has hired hundreds of new auditors over the past few
years and they have been caused much hardship upon unsuspecting
business taxpayers who may not have been fully aware of the
complexities of New York State's sales tax requirements. Thousands of
retail merchants across the state have been subject to new audit
tactics apparently designed to generate as much revenue as possible.
The best way to avoid a sales tax assessment is to be properly
informed of the sales tax laws and to keep books and records in
accordance with the Department of Tax and Finances requirements.
Failure to do so will result in a merchant's sales tax assessment
being determined based on an external index which may reflect much
higher prices for goods and services than the price actually received
by the merchant and reflected on the merchant's books and records.
The current system can result in extremely high and inaccurate
assessments. Relatively small errors in recordkeeping by retail
merchants can expose them to large and sometimes outrageous
assessments for outstanding sales taxes.
This bill provides an incentive to retail merchants to take certain
actions designed to ensure they maintain complete auditable sales
records. It increases the likelihood that these merchants will comply
with the sales .tax laws, generating more revenue for the state and
reducing the need for sales tax enforcement expenditures. In
addition, by providing this incentive to retail merchants, the state
is also helping to ensure their long term stability. Given the
significant economic benefits these small business owners generate


for the state, helping them to succeed is a worthwhile government
venture.

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
________________________________________________________________________

                                  4944

                       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 establishing the recordkeep-
  ing voluntary compliance program for purposes of sales tax liability

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

  Section  1.  The  tax law is amended by adding a new section 1135-a to
read as follows:
  S 1135-A. RECORDKEEPING VOLUNTARY COMPLIANCE  PROGRAM.  1.    NOTWITH-
STANDING  ANY  OTHER  PROVISION  OF  LAW TO THE CONTRARY, THERE SHALL BE
ESTABLISHED A RECORDKEEPING VOLUNTARY COMPLIANCE PROGRAM TO BE  ADMINIS-
TERED BY THE COMMISSIONER, FOR ALL ELIGIBLE TAXPAYERS.
  2. FOR PURPOSES OF THIS SECTION, AN "ELIGIBLE TAXPAYER" IS AN INDIVID-
UAL, PARTNERSHIP, ESTATE, TRUST, CORPORATION, LIMITED LIABILITY COMPANY,
JOINT  STOCK COMPANY, OR ANY OTHER COMPANY, TRUSTEE, RECEIVER, ASSIGNEE,
REFEREE, SOCIETY, ASSOCIATION, BUSINESS OR ANY OTHER PERSON  SUBJECT  TO
SALES TAX IMPOSED BY OR PURSUANT TO THE AUTHORITY OF THIS CHAPTER.
  3. THE COMMISSIONER IS AUTHORIZED TO ENTER INTO A RECORDKEEPING VOLUN-
TARY  COMPLIANCE  AGREEMENT  WITH  AN ELIGIBLE TAXPAYER. A RECORDKEEPING
VOLUNTARY COMPLIANCE AGREEMENT SHALL BE IN A FORM TO BE  ESTABLISHED  BY
THE  COMMISSIONER AND INCLUDE SUCH TERMS AS THE COMMISSIONER MAY REASON-
ABLY REQUIRE TO REQUIRE THE ELIGIBLE  TAXPAYER  TO  MAINTAIN  BOOKS  AND
RECORDS IN A FORM PURSUANT TO SECTION ELEVEN HUNDRED THIRTY-FIVE OF THIS
PART  AND  TO  COMPLY WITH THIS CHAPTER IN THE FUTURE INCLUDING, BUT NOT
LIMITED TO REQUIRING THE USE OF CERTIFIED POINT OF SALES SYSTEMS.
  S 2. Section 1138 of the tax law is amended by adding a  new  subdivi-
sion (e) to read as follows:
  (E)  NOTWITHSTANDING  ANY  OTHER  PROVISION  OF LAW TO THE CONTRARY, A
TAXPAYER THAT IS A PARTY TO A RECORDKEEPING VOLUNTARY COMPLIANCE  AGREE-
MENT PURSUANT TO SECTION ELEVEN HUNDRED THIRTY-FIVE-A OF THIS PART SHALL

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11114-01-1

S. 4944                             2

NOT  BE SUBJECT TO THE PROVISIONS OF PARAGRAPH ONE OF SUBDIVISION (A) OF
THIS SECTION AND NO TAX SHALL BE ESTIMATED  ON  THE  BASIS  OF  EXTERNAL
INDICES  UNLESS  THE COMMISSIONER FINDS THAT THE TAXPAYER IS IN SUBSTAN-
TIAL  NON-COMPLIANCE  WITH ITS RECORDKEEPING VOLUNTARY COMPLIANCE AGREE-
MENT.
  S 3. This act shall take effect immediately.

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