S T A T E   O F   N E W   Y O R K
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                                  2401

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 17, 2013
                               ___________

Introduced  by  Sens.  GRIFFO, LARKIN -- read twice and ordered printed,
  and when printed to be committed to the  Committee  on  Investigations
  and Government Operations

AN  ACT to amend the tax law, in relation to taxes on cigarettes sold on
  an Indian reservation to non-members of the Indian nation or tribe

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

  Section  1. Subdivision 1 of section 471 of the tax law, as amended by
section 1 of part D of chapter 134 of the laws of 2010,  is  amended  to
read as follows:
  1.  There  is hereby imposed and shall be paid a tax on all cigarettes
possessed in the state by any person for sale, except that no tax  shall
be  imposed  on cigarettes sold under such circumstances that this state
is without power to impose such tax, including sales to qualified  Indi-
ans for their own use and consumption on their nations' or tribes' qual-
ified  reservation,  or  sold  to  the  United States or sold to or by a
voluntary unincorporated organization of the armed forces of the  United
States  operating  a place for the sale of goods pursuant to regulations
promulgated by the appropriate executive agency of the United States, to
the extent provided in such regulations and policy statements of such an
agency applicable to such sales. The tax  imposed  by  this  section  is
imposed  on  all cigarettes sold on an Indian reservation to non-members
of the Indian nation or tribe and to non-Indians and  evidence  of  such
tax  shall be by means of an affixed cigarette tax stamp. Indian nations
or tribes may elect to participate in the Indian  tax  exemption  coupon
system established in section four hundred seventy-one-e of this article
which provides a mechanism for the collection of the tax imposed by this
section on cigarette sales on qualified reservations to such non-members
and  non-Indians  and for the delivery of quantities of tax-exempt ciga-
rettes to Indian nations or tribes for the personal use and  consumption
of  qualified members of the Indian nation or tribe. If an Indian nation

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD06444-01-3
              

S. 2401                             2

or tribe does not elect to  participate  in  the  Indian  tax  exemption
coupon  system, the prior approval system shall be the mechanism for the
delivery of quantities of tax-exempt cigarettes  to  Indian  nations  or
tribes  for the personal use and consumption of qualified members of the
Indian nation or tribe as provided for in paragraph (b)  of  subdivision
five  of  this  section.  Such tax on cigarettes shall be at the rate of
four dollars and thirty-five cents for each twenty cigarettes  or  frac-
tion  thereof,  provided,  however,  that  if  a  package  of cigarettes
contains more than twenty cigarettes, the rate of tax on the  cigarettes
in  such  package  in excess of twenty shall be one dollar and eight and
three-quarters cents for  each  five  cigarettes  or  fraction  thereof.
PROVIDED  FURTHER THAT IF THE STATE FAILS TO COLLECT TAXES ON CIGARETTES
SOLD ON AN INDIAN RESERVATION TO NON-MEMBERS OF  THE  INDIAN  NATION  OR
TRIBE BY SEPTEMBER FIRST, TWO THOUSAND FOURTEEN, THAT SUCH CIGARETTE TAX
RATE  WOULD  REVERT TO THE RATE OF TWO DOLLARS AND SEVENTY-FIVE CENTS AS
PREVIOUSLY STATED IN LAW BEFORE THE PASSAGE OF CHAPTER ONE HUNDRED THIR-
TY-FOUR OF THE LAWS OF TWO THOUSAND TEN. ONCE THE STATE BEGINS  COLLECT-
ING  TAXES ON CIGARETTES SOLD ON AN INDIAN RESERVATION TO NON-MEMBERS OF
THE INDIAN NATION OR TRIBE, THE CIGARETTE TAX RATE WOULD BE  IMPOSED  AT
FOUR  DOLLARS  AND THIRTY-FIVE CENTS AS SPECIFIED IN CHAPTER ONE HUNDRED
THIRTY-FOUR OF THE LAWS OF TWO THOUSAND TEN. Such tax is intended to  be
imposed  upon  only one sale of the same package of cigarettes. It shall
be presumed that all cigarettes within the  state  are  subject  to  tax
until  the  contrary  is  established,  and the burden of proof that any
cigarettes are not  taxable  hereunder  shall  be  upon  the  person  in
possession thereof.
  S 2. This act shall take effect immediately.