NY State Senate Bill 2023-S2091

Senate Bill S2091

2023-2024 Legislative Session

Provides motor fuel tax exemption for sales of diesel motor fuel made to commercial fishermen

download bill text pdf

Current Bill Status - In Senate Committee Budget And Revenue Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2024	referred to budget and revenue
Jan 18, 2023	referred to budget and revenue

2023-S2091 (ACTIVE) - Details

See Assembly Version of this Bill:: A3869
Current Committee:: Senate Budget And Revenue
Law Section:: Tax Law
Laws Affected:: Amd §§282-a, 301-b & 1115, Tax L
Versions Introduced in Other Legislative Sessions:: 2011-2012: S6879, A7271
2013-2014: S782, A138
2015-2016: S331, A152
2017-2018: S1600, A938
2019-2020: S3183, A4478
2021-2022: S5164, A5815

2023-S2091 (ACTIVE) - Summary

Eliminates provisions of law that require the payment and subsequent refund of the ten cent diesel excise tax and sales tax on diesel motor fuel when sold to operators of commercial fishing vessels for use in the operation of such vessels.

2023-S2091 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S2091

SPONSOR: PALUMBO
 
TITLE OF BILL:

An act to amend the tax law, in relation to providing an exemption from
the payment of the motor fuels tax and the sales tax on motor fuels used
in the operation of commercial fishing vessels

 
PURPOSE:

Provides a motor fuel tax exemption for sales of diesel motor fuel made
to commercial fishermen.

 
SUMMARY OF PROVISIONS:

This bill amends the tax law in order to eliminate the statute that
requires the payment and subsequent refund of the eight cent diesel
excise tax and the sales tax on diesel fuel when sold to operators of
commercial fishing vessels. Under the current law, both taxes must be
paid by commercial fishermen, notwithstanding their exempt status from
these taxes. The commercial fishermen are then allowed to file for a

refund of these taxes from the Department of Taxation and Finance.

 
JUSTIFICATION:

The original intent of this policy, as it relates to commercial fishing
vessels, was to prevent tax evasion in the diesel fuel industry. Howev-
er, it was not intended to be burdensome to many of the state's indus-
tries such as commercial fishermen and their fuel distributors.

The implementation of this law has caused a great deal of hardship for
commercial fishermen. A fisherman operating a trawler vessel burning
85,000 gallons per year, must advance approximately $13,600 annually in
taxes to the State. The negative financial consequences of this cash
flow are a large burden for the commercial fishermen of this state.

The negative impacts of this law have also been carried over to the fuel
distributors of the commercial fishermen. Because of the payment
requirement, many fishermen are now purchasing their fuel at ports
outside of New York. This will result in the loss of thousands of
dollars in revenue for the state's fuel distributors. This legislation
would no longer require commercial fishermen to pay any excise or state
sales taxes for the purchase of diesel motor fuel.

 
LEGISLATIVE HISTORY:

2022 S.5164/A.5815; 2020 S.3183/A.5815; 2017-18 S.1600/A.938; 2015-16
S.331/A.152; 201314 S.782B/A.138B; 2012 S.6879; 2009-10 A.1903A; 2007-08
A.989; 2005-06 A.3854; 2003-04 A.1416; 2001-02 A.2289; 1999-00 A.2840A.

 
FISCAL IMPLICATIONS:

TBD

 
EFFECTIVE DATE:
This act shall take effect on the first day of a sales tax quarterly
period, as described in subdivision (b) of Section 1136 of the tax law,
next commencing at least ninety days after this act shall have become
law, sections four and five of this act shall apply to sales made under
and uses occurring on or after the dates such sections four and five
shall have taken effect, respectively, although made or occurring under
a prior contract; and provided further that the amendments made by
section four of this act shall be subject to the expiration and rever-
sion of such subdivision pursuant to Section 19 of part W-1 of Chapter
109 of the laws of 2006, as amended, when upon such date the provisions
of section five of this act shall take effect.

2023-S2091 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2091
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             January 18, 2023
                                ___________
 
 Introduced  by  Sen. PALUMBO -- read twice and ordered printed, and when
   printed to be committed to the Committee on Budget and Revenue
 
 AN ACT to amend the tax law, in relation to providing an exemption  from
   the  payment  of  the motor fuels tax and the sales tax on motor fuels
   used in the operation of commercial fishing vessels

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1.  Paragraph (b) of subdivision 3 of section 282-a of the tax
 law,  as  amended  by  section  3 of part W of chapter 59 of the laws of
 2013, is amended to read as follows:
   (b) The tax on the incidence of sale or use imposed by subdivision one
 of this section shall not apply to: (i) the sale or use  of  non-highway
 Diesel  motor  fuel, but only if all of such fuel is consumed other than
 on the public highways of this state (except for the use of  the  public
 highway by farmers to reach adjacent farmlands); provided, however, this
 exemption  shall in no event apply to a sale of non-highway Diesel motor
 fuel which involves a delivery at a filling station or into a repository
 which is equipped with a hose or other apparatus by which such fuel  can
 be  dispensed into the fuel tank of a motor vehicle (except for delivery
 at a farm site which qualifies for the exemption under  subdivision  (g)
 of  section  three hundred one-b of this chapter); or (ii) a sale to the
 consumer consisting of not more than twenty gallons of water-white kero-
 sene to be used and consumed exclusively for heating purposes; or  (iii)
 the  sale  to or delivery at a filling station or other retail vendor of
 water-white kerosene provided  such  filling  station  or  other  retail
 vendor  only  sells  such  water-white  kerosene exclusively for heating
 purposes in containers of no more than twenty gallons; or (iv) a sale of
 kero-jet fuel to an airline for use in its airplanes or a use  of  kero-
 jet  fuel by an airline in its airplanes; or (v) a sale of kero-jet fuel
 by a registered distributor of Diesel motor fuel to a fixed base  opera-
 tor registered under this article as a distributor of kero-jet fuel only
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD03843-01-3

 S. 2091                             2
 
 where  such  fixed base operator is engaged solely in making or offering
 to make retail sales not in bulk of kero-jet fuel directly into the fuel
 tank of an airplane for the purpose of operating such airplane; or  (vi)
 a  retail  sale  not  in  bulk of kero-jet fuel by a fixed base operator
 registered under this article as a distributor  of  kero-jet  fuel  only
 where  such fuel is delivered directly into the fuel tank of an airplane
 for use in the operation of such airplane; or (vii) the sale  of  previ-
 ously  untaxed  qualified  biodiesel  to  a person registered under this
 article as a distributor of Diesel motor fuel other than  (A)  a  retail
 sale to such person or (B) a sale to such person which involves a deliv-
 ery  at  a filling station or into a repository which is equipped with a
 hose or other  apparatus  by  which  such  qualified  biodiesel  can  be
 dispensed  into  the fuel tank of a motor vehicle; or (viii) the sale of
 previously untaxed highway Diesel motor  fuel  by  a  person  registered
 under  this  article  as  a distributor of Diesel motor fuel to a person
 registered under this article as a  distributor  of  Diesel  motor  fuel
 where  the  highway  Diesel motor fuel is either: (A) being delivered by
 pipeline, railcar, barge, tanker or other  vessel  to  a  terminal,  the
 operator  of  which  terminal  is  registered  under section two hundred
 eighty-three-b of this article, or (B) within such a terminal  where  it
 has  been  so delivered. Provided, however, that the exemption set forth
 in this subparagraph shall not apply to any highway Diesel motor fuel if
 it is removed from a terminal, other than by pipeline, barge, tanker  or
 other vessel; OR (IX) A SALE OF DIESEL MOTOR FUEL TO A "COMMERCIAL FISH-
 ERMAN",  AS  SUCH  TERM  IS  DEFINED IN SUBDIVISION (I) OF SECTION THREE
 HUNDRED OF THIS CHAPTER, AT RETAIL UNDER THE CIRCUMSTANCES SET FORTH  IN
 PARAGRAPH  ONE OF SUBDIVISION (G) OF SECTION THREE HUNDRED ONE-C OF THIS
 CHAPTER, AND WHERE SUCH COMMERCIAL  FISHING  VESSEL  IS  OPERATED  BY  A
 COMMERCIAL FISHERMAN.
   §  2.  Subdivision  4  of  section 282-a of the tax law, as amended by
 section 5 of part K of chapter 61 of the laws of  2011,  is  amended  to
 read as follows:
   4.  The  tax  imposed  by  this  section on Diesel motor fuel shall be
 passed through by the seller and included as part of the  selling  price
 to each purchaser of such fuel. Provided, however, the amount of the tax
 imposed by this section may be excluded from the selling price of Diesel
 motor fuel where (i) a sale of Diesel motor fuel is made to an organiza-
 tion  described  in  paragraph  (a) of subdivision three of this section
 solely for the purpose stated therein; (ii) a sale of non-highway Diesel
 motor fuel is made to a consumer but only  if  such  non-highway  Diesel
 motor  fuel  is not delivered to a filling station, nor delivered into a
 storage tank which is equipped with a hose or other apparatus  by  which
 such  fuel  can  be  dispensed into the fuel tank of a motor vehicle; or
 (iii) the sale to or delivery at  a  filling  station  or  other  retail
 vendor  of  water-white  kerosene provided such filling station or other
 retail vendor only sells such water-white kerosene exclusively for heat-
 ing purposes in containers of no more than twenty  gallons;  or  (iv)  a
 sale of kero-jet fuel is made to an airline for use in its airplanes; OR
 (V)  A SALE OF DIESEL MOTOR FUEL IS MADE TO A "COMMERCIAL FISHERMAN", AS
 SUCH TERM IS DEFINED IN SUBDIVISION (I) OF SECTION THREE HUNDRED OF THIS
 CHAPTER, AT RETAIL UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH ONE OF
 SUBDIVISION (G) OF SECTION THREE HUNDRED  ONE-C  OF  THIS  CHAPTER,  AND
 WHERE SUCH COMMERCIAL FISHING VESSEL IS OPERATED BY A COMMERCIAL FISHER-
 MAN.
   §  3. Section 301-b of the tax law is amended by adding a new subdivi-
 sion (k) to read as follows:
 S. 2091                             3
 
   (K) SALES OR USES OF DIESEL MOTOR FUEL AND RESIDUAL PETROLEUM  PRODUCT
 FOR  COMMERCIAL FISHING. DIESEL MOTOR FUEL OR RESIDUAL PETROLEUM PRODUCT
 SOLD TO OR USED BY A "COMMERCIAL FISHERMAN", AS SUCH TERM IS DEFINED  IN
 SUBDIVISION  (I)  OF  SECTION  THREE  HUNDRED OF THIS ARTICLE, AT RETAIL
 UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH ONE OF SUBDIVISION (G) OF
 SECTION  THREE  HUNDRED ONE-C OF THIS ARTICLE, AND WHERE SUCH COMMERCIAL
 FISHING VESSEL IS OPERATED BY A COMMERCIAL FISHERMAN.
   § 4. Subdivision (j) of section 1115 of the tax  law,  as  amended  by
 section  41  of  part K of chapter 61 of the laws of 2011, is amended to
 read as follows:
   (j) The exemptions provided in this section shall not apply to the tax
 required to be prepaid pursuant to  the  provisions  of  section  eleven
 hundred  two of this article nor to the taxes imposed by sections eleven
 hundred five and eleven hundred ten of  this  article  with  respect  to
 receipts  from sales and uses of motor fuel or diesel motor fuel, except
 that the exemptions provided in paragraphs nine and forty-two of  subdi-
 vision (a) of this section shall apply to the tax required to be prepaid
 pursuant to the provisions of section eleven hundred two of this article
 and  to  the  taxes  imposed  by sections eleven hundred five and eleven
 hundred ten of this article with respect to sales and uses  of  kero-jet
 fuel,  CNG,  hydrogen  and E85, provided, however, the exemption allowed
 for E85 shall be subject to  the  additional  requirements  provided  in
 section  eleven  hundred  two  of  this  article with respect to E85 AND
 EXCEPT THAT THE EXEMPTION PROVIDED IN PARAGRAPH TWENTY-FOUR OF  SUBDIVI-
 SION  (A)  OF  THIS SECTION SHALL APPLY TO THE TAXES IMPOSED BY SECTIONS
 ELEVEN HUNDRED FIVE AND ELEVEN HUNDRED TEN OF THIS ARTICLE WITH  RESPECT
 TO  SALES AND USES OF DIESEL MOTOR FUEL USED IN THE OPERATION OF A FISH-
 ING VESSEL AS DESCRIBED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION  (A)  OF
 THIS SECTION.  The exemption provided in subdivision (c) of this section
 shall  apply to sales and uses of non-highway diesel motor fuel but only
 if all of such fuel is consumed other than on  the  public  highways  of
 this  state.   The exemption provided in subdivision (c) of this section
 shall apply to sales and uses of non-highway diesel motor fuel  for  use
 or  consumption  either  in the production for sale of tangible personal
 property by farming or in a commercial horse boarding operation,  or  in
 both  but  only if all of such fuel is consumed other than on the public
 highways of this state (except for the use of  the  public  highways  to
 reach  adjacent  farmlands  or adjacent lands used in a commercial horse
 boarding operation, or both).
   § 5. Subdivision (j) of section 1115 of the tax  law,  as  amended  by
 section  41-a of part K of chapter 61 of the laws of 2011, is amended to
 read as follows:
   (j) The exemptions provided in this section shall not apply to the tax
 required to be prepaid pursuant to  the  provisions  of  section  eleven
 hundred  two of this article nor to the taxes imposed by sections eleven
 hundred five and eleven hundred ten of  this  article  with  respect  to
 receipts  from sales and uses of motor fuel or diesel motor fuel, except
 that the exemption provided in paragraph nine of subdivision (a) of this
 section shall apply to the tax required to be prepaid  pursuant  to  the
 provisions  of  section  eleven  hundred  two of this article and to the
 taxes imposed by sections eleven hundred five and eleven hundred ten  of
 this  article with respect to sales and uses of kero-jet fuel AND EXCEPT
 THAT THE EXEMPTION PROVIDED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION  (A)
 OF  THIS  SECTION  SHALL  APPLY  TO THE TAXES IMPOSED BY SECTIONS ELEVEN
 HUNDRED FIVE AND ELEVEN HUNDRED TEN OF  THIS  ARTICLE  WITH  RESPECT  TO
 SALES  AND  USES OF DIESEL MOTOR FUEL USED IN THE OPERATION OF A FISHING
 S. 2091                             4
 
 VESSEL AS DESCRIBED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION (A) OF  THIS
 SECTION.    The  exemption  provided  in subdivision (c) of this section
 shall apply to sales and uses of non-highway diesel motor fuel but  only
 if  all  of  such  fuel is consumed other than on the public highways of
 this state. The exemption provided in subdivision (c)  of  this  section
 shall  apply  to sales and uses of non-highway diesel motor fuel for use
 or consumption either in the production for sale  of  tangible  personal
 property  by  farming or in a commercial horse boarding operation, or in
 both but only if all of such fuel is consumed other than on  the  public
 highways  of  this  state  (except for the use of the public highways to
 reach adjacent farmlands or adjacent lands used in  a  commercial  horse
 boarding operation, or both).
   § 6.  This act shall take effect on the first day of a sales tax quar-
 terly period, as described in subdivision (b) of section 1136 of the tax
 law,  next  commencing  at  least  ninety days after this act shall have
 become a law; sections four and five of this act shall  apply  to  sales
 made  under  and uses occurring on or after the dates such sections four
 and five shall have taken effect, respectively, although made or  occur-
 ring  under  a prior contract; and provided further that such amendments
 made by section four of this act shall be subject to the expiration  and
 reversion  of  such  subdivision  pursuant  to section 19 of part W-1 of
 chapter 109 of the laws of 2006, as amended, when  upon  such  date  the
 provisions of section five of this act shall take effect.

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