senate Bill S3612A

2013-2014 Legislative Session

Prohibits the use of automated sales suppression devices, zappers or phantom-ware

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Sponsored By

Archive: Last Bill Status - Passed Senate


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Actions

view actions (22)
Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jun 18, 2014 referred to ways and means
delivered to assembly
passed senate
May 28, 2014 advanced to third reading
May 21, 2014 2nd report cal.
May 20, 2014 1st report cal.840
Jan 29, 2014 print number 3612b
amend and recommit to finance
Jan 14, 2014 reported and committed to finance
Jan 08, 2014 referred to investigations and government operations
returned to senate
died in assembly
Jun 17, 2013 referred to ways and means
delivered to assembly
passed senate
Jun 03, 2013 advanced to third reading
May 30, 2013 2nd report cal.
May 29, 2013 1st report cal.795
May 14, 2013 print number 3612a
amend and recommit to finance
Apr 30, 2013 reported and committed to finance
Feb 07, 2013 referred to investigations and government operations

Votes

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Jan 14, 2014 - Investigations and Government Operations committee Vote

S3612A
9
0
committee
9
Aye
0
Nay
0
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show Investigations and Government Operations committee vote details

Investigations and Government Operations Committee Vote: Jan 14, 2014

May 29, 2013 - Finance committee Vote

S3612A
35
0
committee
35
Aye
0
Nay
0
Aye with Reservations
0
Absent
1
Excused
0
Abstained
show Finance committee vote details

Apr 30, 2013 - Investigations and Government Operations committee Vote

S3612
9
0
committee
9
Aye
0
Nay
0
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

Committee Vote: Apr 30, 2013

Bill Amendments

Original
A
B (Active)
Original
A
B (Active)

Co-Sponsors

S3612 - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §1816, Tax L
Versions Introduced in 2011-2012 Legislative Session:
S7733

S3612 - Bill Texts

view summary

Prohibits the use of automated sales suppression devices, zappers or phantom-ware.

view sponsor memo
BILL NUMBER:S3612

TITLE OF BILL: An act to amend the tax law, in relation to prohibiting
the use of automated sales suppression devices, zappers or phantom-ware

PURPOSE: To make it illegal for a person to knowingly purchase, possess,
install, update, maintain, upgrade, transfer or use any automated sales
suppression device, zapper or phantom-ware.

SUMMARY OF PROVISIONS:

Section 1: Adds a new section 1816 to the Tax law to define automated
sales suppression device or zapper, electronic cash register, phantom-
ware, transaction data and transaction data.

Prohibits and makes it an offense for a person to knowingly purchase,
possess, install, update, transfer or use any automated sales
suppression device, zapper or phantom-ware. It is also an offense to
transmit data with the intent of data manipulation.

A violation is a class E felony punishable by a fine between five thou-
sand dollars and twenty-five thousand dollars. For a second offense
within five years, it is punishable by a fine between twenty-five thou-
sand and one hundred thousand dollars, and for a third or subsequent
offense within ten years, by a fine of between one hundred thousand
dollars and five hundred thousand dollars.

It is an offense for a person to knowingly sell any automated sales
suppression device, zapper or phantom-ware. This violation is a class E
felony punishable by a fine of twenty-five thousand dollars per inci-
dent.

Section 2: This act takes effect on January 1, 2015.

JUSTIFICATION: Automated sales suppression devices can be used to evade
sales tax collection, including the so called tax-zapper software that
lets businesses, especially those that deal mostly in cash, to underre-
port taxable sales and pocket money that should be given to the govern-
ment.

During business hours, cashiers record the true sales and give customers
accurate receipts. The software also stores real sales electronically.
After hours, a memory stick that contains the zapper is inserted to
remove a given amount in the sales from the day's receipts. For each
altered transaction, the zapper software will also re-total and recalcu-
late the individuals receipts. This action alters the tax due and
creates a second set of books.

The Internal Revenue Service finds more than half of all cash businesses
under-report income from their sales. The IRS does not tack the use of
zapper software. As a result, New York State has increased their focus

on cash businesses. It is estimated that New York State loses over $1
billion in tax revenue annually as a result of these devices.

It has been reported that New York State operated a series of stings
operations in which cash register vendors were invited to pitch their
equipment to phony restaurants. The results were shocking. In many
cases, the vendors offered the phony restaurant opportunities to under-
pay their taxes using zapper software.

The majority of the businesses in our State are complying with New York
State sales tax laws and properly remitting the money collected. This
legislation is focused on the small number of businesses which are ille-
gally underreporting their tax collections.

LEGISLATIVE HISTORY: 2012: S. 7733 Passed Senate/No Same As

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: This act shall take effect on January 1, 2015.

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

                                  3612

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 7, 2013
                               ___________

Introduced  by  Sen.  MARCELLINO  -- 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 prohibiting the use of auto-
  mated sales suppression devices, zappers or phantom-ware

  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 1816 to read
as follows:
  S 1816. AUTOMATED SALES SUPPRESSION. (A) DEFINITIONS. AS USED IN  THIS
SECTION:
  (1)  "AUTOMATED SALES SUPPRESSION DEVICE" OR "ZAPPER" MEANS A SOFTWARE
PROGRAM, CARRIED ON A MEMORY STICK OR REMOVABLE COMPACT  DISC,  ACCESSED
THROUGH  AN  INTERNET  LINK,  OR  ACCESSED THROUGH ANY OTHER MEANS, THAT
FALSIFIES THE ELECTRONIC RECORDS OF ELECTRONIC CASH REGISTERS AND  OTHER
POINT-OF-SALE  SYSTEMS,  INCLUDING, BUT NOT LIMITED TO, TRANSACTION DATA
AND TRANSACTION REPORTS.
  (2) "ELECTRONIC CASH REGISTER" MEANS A DEVICE THAT KEEPS A REGISTER OR
SUPPORTING DOCUMENTS THROUGH  THE  MEANS  OF  AN  ELECTRONIC  DEVICE  OR
COMPUTER  SYSTEM  DESIGNED TO RECORD TRANSACTION DATA FOR THE PURPOSE OF
COMPUTING, COMPILING, OR PROCESSING TRANSACTION DATA.
  (3) "PHANTOM-WARE" MEANS A HIDDEN, PREINSTALLED,  OR  INSTALLED  AT  A
LATER  TIME  PROGRAMMING  OPTION  EMBEDDED IN THE OPERATING SYSTEM OF AN
ELECTRONIC CASH REGISTER OR HARDWIRED INTO THE ELECTRONIC CASH  REGISTER
THAT  WITH  INTENT  OR  BY  SPECIFIC  DESIGN IS USED TO CREATE A VIRTUAL
SECOND TILL OR MAY ELIMINATE OR MANIPULATE TRANSACTION RECORDS THAT  MAY
OR  MAY  NOT  BE  PRESERVED  IN DIGITAL FORMATS TO REPRESENT THE TRUE OR
MANIPULATED RECORD OF TRANSACTIONS IN THE ELECTRONIC CASH REGISTER.
  (4) "TRANSACTION DATA" MEANS DATA ASSOCIATED WITH ITEMS PURCHASED BY A
CUSTOMER, THE PRICE FOR EACH ITEM, A TAXABILITY DETERMINATION  FOR  EACH
ITEM, A SEGREGATED TAX AMOUNT FOR EACH OF THE TAXED ITEMS, THE AMOUNT OF

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08470-01-3

S. 3612                             2

CASH  OR  CREDIT  TENDERED,  THE  NET AMOUNT RETURNED TO THE CUSTOMER IN
CHANGE, THE DATE AND TIME OF THE PURCHASE, THE NAME, ADDRESS, AND  IDEN-
TIFICATION  NUMBER  OF  THE VENDOR, AND THE RECEIPT, SEQUENCE OR INVOICE
NUMBER OF THE TRANSACTION.
  (5)  "TRANSACTION  REPORT" MEANS A REPORT DOCUMENTING DATA, INCLUDING,
BUT NOT LIMITED TO, DATA ASSOCIATED WITH SALES, TAXES  COLLECTED,  MEDIA
TOTALS, AND DISCOUNT VOIDS AT AN ELECTRONIC CASH REGISTER THAT IS PRINT-
ED ON CASH REGISTER TAPE AT THE END OF A DAY OR SHIFT, OR A REPORT DOCU-
MENTING EVERY ACTION AT AN ELECTRONIC CASH REGISTER THAT IS STORED ELEC-
TRONICALLY.
  (6)  "PERSON"  SHALL HAVE THE SAME DEFINITION AS IN SUBDIVISION (A) OF
SECTION ELEVEN HUNDRED ONE OF THIS CHAPTER.
  (B) PROHIBITIONS. (1) IT IS AN  OFFENSE  FOR  A  PERSON  TO  KNOWINGLY
PURCHASE,  POSSESS,  INSTALL, UPDATE, MAINTAIN, UPGRADE, TRANSFER OR USE
ANY AUTOMATED SALES SUPPRESSION DEVICE, ZAPPER OR PHANTOM-WARE.   IT  IS
ALSO AN OFFENSE TO TRANSMIT DATA WITH THE INTENT OF DATA MANIPULATION.
  (2)  A  VIOLATION  OF  PARAGRAPH  ONE OF THIS SUBDIVISION IS A CLASS E
FELONY PUNISHABLE BY A FINE OF NOT LESS THAN FIVE THOUSAND  DOLLARS  BUT
NOT  MORE  THAN  TWENTY-FIVE  THOUSAND DOLLARS AND, FOR A SECOND OFFENSE
WITHIN FIVE YEARS, BY A FINE  OF  NOT  LESS  THAN  TWENTY-FIVE  THOUSAND
DOLLARS  BUT NOT MORE THAN ONE HUNDRED THOUSAND DOLLARS AND, FOR A THIRD
OR SUBSEQUENT OFFENSE WITHIN TEN YEARS, BY A FINE OF NOT LESS  THAN  ONE
HUNDRED  THOUSAND  DOLLARS  BUT  NOT  MORE  THAN  FIVE  HUNDRED THOUSAND
DOLLARS.
  (3) IT IS AN OFFENSE FOR A PERSON  TO  KNOWINGLY  SELL  ANY  AUTOMATED
SALES SUPPRESSION DEVICE, ZAPPER OR PHANTOM-WARE.
  (4)  A  VIOLATION  OF PARAGRAPH THREE OF THIS SUBDIVISION IS A CLASS E
FELONY PUNISHABLE BY A FINE OF TWENTY-FIVE THOUSAND  DOLLARS  PER  INCI-
DENT.
  (5)  THE  OFFENSES CREATED BY THIS SECTION SHALL BE IN ADDITION TO AND
CONSIDERED A SEPARATE OFFENSE  FROM  ANY  OFFENSE  OF  SECTION  EIGHTEEN
HUNDRED SEVENTEEN OF THIS PART.
  S 2. This act shall take effect January 1, 2015.

Co-Sponsors

S3612A - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §1816, Tax L
Versions Introduced in 2011-2012 Legislative Session:
S7733

S3612A - Bill Texts

view summary

Prohibits the use of automated sales suppression devices, zappers or phantom-ware.

view sponsor memo
BILL NUMBER:S3612A

TITLE OF BILL: An act to amend the tax law, in relation to
prohibiting the use of automated sales suppression devices, zappers or
phantom-ware

PURPOSE:

To make it illegal for a person to knowingly purchase, possess,
install, update, maintain, upgrade, transfer or use any automated
sales suppression device, zapper or phantom-ware.

SUMMARY OF PROVISIONS:

Section 1: Adds a new section 1816 to the Tax law to define automated
sales suppression device or zapper, electronic cash register,
phantom-ware, transaction data and transaction data.

Prohibits and makes it an offense for a person to knowingly purchase,
possess, install, update, maintain, upgrade transfer or use any
automated sales suppression device, zapper or phantom-ware. It is also
an offense to transmit transaction data with the intent of data
manipulation for the purpose of evading any taxes under this article.

A violation is a class E felony punishable by a fine between five
thousand dollars and twenty-five thousand dollars. For a second
offense within five years, it is punishable by a fine between
twenty-five thousand and one hundred thousand dollars, and for a third
or subsequent offense within ten years, by a fine of between one
hundred thousand dollars and five hundred thousand dollars.

It is an offense for a person to knowingly sell any automated sales
suppression device, zapper or phantom-ware. This violation is a class
E felony punishable by a fine of twenty-five thousand dollars per
incident.

Section 2: This act takes effect on January 1, 2015.

JUSTIFICATION:

Automated sales suppression devices can be used to evade sales tax
collection, including the so called tax-zapper software that lets
businesses, especially those that deal mostly in cash, to underreport
taxable sales and pocket money that should be given to the government.

During business hours, cashiers record the true sales and give
customers accurate receipts. The software also stores real sales
electronically. After hours, a memory stick that contains the zapper
is inserted to remove a given amount in the sales from the day's
receipts. For each altered transaction, the zapper software will also
re-total and recalculate the individuals receipts. This action alters
the tax due and creates a second set of books.

The Internal Revenue Service finds more than half of all cash
businesses under-report income from their sales. The IRS does not
track the use of zapper software. As a result, New York State has
increased their focus on cash businesses. It is estimated that New


York State loses over $1 billion in tax revenue annually as a result
of these devices.

It has been reported that New York State operated a series of stings
operations in which cash register vendors were invited to pitch their
equipment to phony restaurants. The results were shocking. In many
cases, the vendors offered the phony restaurant opportunities to
underpay their taxes using zapper software.

The majority of the businesses in our State are complying with New
York State sales tax laws and properly remitting the money collected.
This legislation is focused on the small number of businesses which
are illegally underreporting their tax collections.

LEGISLATIVE HISTORY:

2012: S. 7733 Passed Senate/No Same As

FISCAL IMPLICATIONS:

None.

EFFECTIVE DATE:

This act shall take effect on January 1, 2015.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 3612--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 7, 2013
                               ___________

Introduced  by Sens. MARCELLINO, GOLDEN -- read twice and ordered print-
  ed, and when printed to be committed  to  the  Committee  on  Investi-
  gations  and  Government  Operations  --  reported favorably from said
  committee and committed to  the  Committee  on  Finance  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN ACT to amend the tax law, in relation to prohibiting the use of auto-
  mated sales suppression devices, zappers or phantom-ware

  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 1816 to read
as follows:
  S 1816. AUTOMATED SALES SUPPRESSION. (A) DEFINITIONS. AS USED IN  THIS
SECTION:
  (1)  "AUTOMATED SALES SUPPRESSION DEVICE" OR "ZAPPER" MEANS A SOFTWARE
PROGRAM, CARRIED ON A MEMORY STICK OR REMOVABLE COMPACT  DISC,  ACCESSED
THROUGH  AN  INTERNET  LINK,  OR  ACCESSED THROUGH ANY OTHER MEANS, THAT
FALSIFIES THE ELECTRONIC RECORDS OF ELECTRONIC CASH REGISTERS AND  OTHER
POINT-OF-SALE  SYSTEMS,  INCLUDING, BUT NOT LIMITED TO, TRANSACTION DATA
AND TRANSACTION REPORTS.
  (2) "ELECTRONIC CASH REGISTER" MEANS A DEVICE THAT KEEPS A REGISTER OR
SUPPORTING DOCUMENTS THROUGH  THE  MEANS  OF  AN  ELECTRONIC  DEVICE  OR
COMPUTER  SYSTEM  DESIGNED TO RECORD TRANSACTION DATA FOR THE PURPOSE OF
COMPUTING, COMPILING, OR PROCESSING TRANSACTION DATA.
  (3) "PHANTOM-WARE" MEANS A HIDDEN, PREINSTALLED,  OR  INSTALLED  AT  A
LATER  TIME  PROGRAMMING  OPTION  EMBEDDED IN THE OPERATING SYSTEM OF AN
ELECTRONIC CASH REGISTER OR HARDWIRED INTO THE ELECTRONIC CASH  REGISTER
THAT  WITH  INTENT  OR  BY  SPECIFIC  DESIGN IS USED TO CREATE A VIRTUAL
SECOND TILL OR MAY ELIMINATE OR MANIPULATE TRANSACTION RECORDS THAT  MAY
OR  MAY  NOT  BE  PRESERVED  IN DIGITAL FORMATS TO REPRESENT THE TRUE OR
MANIPULATED RECORD OF TRANSACTIONS IN THE ELECTRONIC CASH REGISTER.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08470-02-3

S. 3612--A                          2

  (4) "TRANSACTION DATA" MEANS DATA ASSOCIATED WITH ITEMS PURCHASED BY A
CUSTOMER, THE PRICE FOR EACH ITEM, A TAXABILITY DETERMINATION  FOR  EACH
ITEM, A SEGREGATED TAX AMOUNT FOR EACH OF THE TAXED ITEMS, THE AMOUNT OF
CASH  OR  CREDIT  TENDERED,  THE  NET AMOUNT RETURNED TO THE CUSTOMER IN
CHANGE,  THE DATE AND TIME OF THE PURCHASE, THE NAME, ADDRESS, AND IDEN-
TIFICATION NUMBER OF THE VENDOR, AND THE RECEIPT,  SEQUENCE  OR  INVOICE
NUMBER OF THE TRANSACTION.
  (5)  "TRANSACTION  REPORT" MEANS A REPORT DOCUMENTING DATA, INCLUDING,
BUT NOT LIMITED TO, DATA ASSOCIATED WITH SALES, TAXES  COLLECTED,  MEDIA
TOTALS, AND DISCOUNT VOIDS AT AN ELECTRONIC CASH REGISTER THAT IS PRINT-
ED ON CASH REGISTER TAPE AT THE END OF A DAY OR SHIFT, OR A REPORT DOCU-
MENTING EVERY ACTION AT AN ELECTRONIC CASH REGISTER THAT IS STORED ELEC-
TRONICALLY.
  (6)  "PERSON"  SHALL HAVE THE SAME DEFINITION AS IN SUBDIVISION (A) OF
SECTION ELEVEN HUNDRED ONE OF THIS CHAPTER.
  (B) PROHIBITIONS. (1) IT IS AN  OFFENSE  FOR  A  PERSON  TO  KNOWINGLY
PURCHASE,  POSSESS,  INSTALL, UPDATE, MAINTAIN, UPGRADE, TRANSFER OR USE
ANY AUTOMATED SALES SUPPRESSION DEVICE, ZAPPER OR PHANTOM-WARE.   IT  IS
ALSO  AN  OFFENSE  TO  TRANSMIT TRANSACTION DATA WITH THE INTENT OF DATA
MANIPULATION FOR THE PURPOSE OF EVADING ANY TAXES UNDER THIS ARTICLE.
  (2) A VIOLATION OF PARAGRAPH ONE OF THIS  SUBDIVISION  IS  A  CLASS  E
FELONY  PUNISHABLE  BY A FINE OF NOT LESS THAN FIVE THOUSAND DOLLARS BUT
NOT MORE THAN TWENTY-FIVE THOUSAND DOLLARS AND,  FOR  A  SECOND  OFFENSE
WITHIN  FIVE  YEARS,  BY  A  FINE  OF NOT LESS THAN TWENTY-FIVE THOUSAND
DOLLARS BUT NOT MORE THAN ONE HUNDRED THOUSAND DOLLARS AND, FOR A  THIRD
OR  SUBSEQUENT  OFFENSE WITHIN TEN YEARS, BY A FINE OF NOT LESS THAN ONE
HUNDRED THOUSAND  DOLLARS  BUT  NOT  MORE  THAN  FIVE  HUNDRED  THOUSAND
DOLLARS.
  (3)  IT  IS  AN  OFFENSE  FOR A PERSON TO KNOWINGLY SELL ANY AUTOMATED
SALES SUPPRESSION DEVICE, ZAPPER OR PHANTOM-WARE.
  (4) A VIOLATION OF PARAGRAPH THREE OF THIS SUBDIVISION IS  A  CLASS  E
FELONY  PUNISHABLE  BY  A FINE OF TWENTY-FIVE THOUSAND DOLLARS PER INCI-
DENT.
  (5) THE OFFENSES CREATED BY THIS SECTION SHALL BE IN ADDITION  TO  AND
CONSIDERED  A  SEPARATE  OFFENSE  FROM  ANY  OFFENSE OF SECTION EIGHTEEN
HUNDRED SEVENTEEN OF THIS PART.
  S 2. This act shall take effect January 1, 2015.

Co-Sponsors

S3612B (ACTIVE) - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §1816, Tax L
Versions Introduced in 2011-2012 Legislative Session:
S7733

S3612B (ACTIVE) - Bill Texts

view summary

Prohibits the use of automated sales suppression devices, zappers or phantom-ware.

view sponsor memo
BILL NUMBER:S3612B

TITLE OF BILL: An act to amend the tax law, in relation to
prohibiting the use of automated sales suppression devices, zappers or
phantom-ware

PURPOSE:

To make it illegal for a person to knowingly purchase, possess,
install, update, maintain, upgrade, transfer or use any automated
sales suppression device, zapper or phantom-ware.

SUMMARY OF PROVISIONS:

Section 1: Adds a new section 1816 to the Tax law to define automated
sales suppression device or zapper, electronic cash register,
phantom-ware, transaction data and transaction data.

Prohibits and makes it an offense for a person to knowingly purchase,
possess, install, update, transfer or use any automated sales
suppression device, zapper or phantom-ware. It is also an offense to
transmit data with the intent of data manipulation.

A violation is a class E felony punishable by a fine between five
thousand dollars and twenty-five thousand dollars. For a second
offense within five years, it is punishable by a fine between
twenty-five thousand and one hundred thousand dollars, and for a third
or subsequent offense within ten years, by a fine of between one
hundred thousand dollars and five hundred thousand dollars.

It is an offense for a person to knowingly sell any automated sales
suppression device, zapper or phantom-ware. This violation is a class
E felony punishable by a fine of twenty-five thousand dollars per
incident.

Section 2: This act takes effect on January 1, 2016.

JUSTIFICATION:

Automated sales suppression devices can be used to evade sales tax
collection, including the so called tax-zapper software that lets
businesses, especially those that deal mostly in cash, to underreport
taxable sales and pocket money that should be given to the government.

During business hours, cashiers record the true sales and give
customers accurate receipts. The software also stores real sales
electronically. After hours, a memory stick that contains the zapper
is inserted to remove a given amount in the sales from the day's
receipts. For each altered transaction, the zapper software will also
re-total and recalculate the individuals receipts. This action alters
the tax due and creates a second set of books.

The Internal Revenue Service finds more than half of all cash
businesses under-report income from their sales. The IRS does not
track the use of zapper software. As a result, New York State has
increased their focus on cash businesses. It is estimated that New


York State loses over $1 billion in tax revenue annually as a result
of these devices.

It has been reported that New York State operated a series of stings
operations in which cash register vendors were invited to pitch their
equipment to phony restaurants. The results were shocking. In many
cases, the vendors offered the phony restaurant opportunities to
underpay their taxes using zapper software.

The majority of the businesses in our State are complying with New
York State sales tax laws and properly remitting the money collected.
This legislation is focused on the small number of businesses which
are illegally underreporting their tax collections.

LEGISLATIVE HISTORY:

2012: S. 7733 Passed Senate/No Same As.
2013: S.3612-A passed Senate/A.7420 - referred to Ways & Means

FISCAL IMPLICATIONS:

None.

EFFECTIVE DATE:

This act shall take effect on January 1, 2016.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 3612--B

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 7, 2013
                               ___________

Introduced  by  Sens. MARCELLINO, BONACIC, GOLDEN, KRUEGER -- read twice
  and ordered printed, and when printed to be committed to the Committee
  on Investigations and Government Operations -- reported favorably from
  said committee and committed to the Committee on Finance --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to  said  committee  -- recommitted to the Committee on Investigations
  and Government Operations in accordance with Senate Rule 6, sec. 8  --
  reported  favorably from said committee and committed to the Committee
  on Finance -- committee discharged, bill amended, ordered reprinted as
  amended and recommitted to said committee

AN ACT to amend the tax law, in relation to prohibiting the use of auto-
  mated sales suppression devices, zappers or phantom-ware

  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 1816 to read
as follows:
  S  1816. AUTOMATED SALES SUPPRESSION. (A) DEFINITIONS. AS USED IN THIS
SECTION:
  (1) "AUTOMATED SALES SUPPRESSION DEVICE" OR "ZAPPER" MEANS A  SOFTWARE
PROGRAM,  CARRIED  ON A MEMORY STICK OR REMOVABLE COMPACT DISC, ACCESSED
THROUGH AN INTERNET LINK, OR ACCESSED  THROUGH  ANY  OTHER  MEANS,  THAT
FALSIFIES  THE ELECTRONIC RECORDS OF ELECTRONIC CASH REGISTERS AND OTHER
POINT-OF-SALE SYSTEMS, INCLUDING, BUT NOT LIMITED TO,  TRANSACTION  DATA
AND TRANSACTION REPORTS.
  (2) "ELECTRONIC CASH REGISTER" MEANS A DEVICE THAT KEEPS A REGISTER OR
SUPPORTING  DOCUMENTS  THROUGH  THE  MEANS  OF  AN  ELECTRONIC DEVICE OR
COMPUTER SYSTEM DESIGNED TO RECORD TRANSACTION DATA FOR THE  PURPOSE  OF
COMPUTING, COMPILING, OR PROCESSING TRANSACTION DATA.
  (3)  "PHANTOM-WARE"  MEANS  A  HIDDEN, PREINSTALLED, OR INSTALLED AT A
LATER TIME PROGRAMMING OPTION EMBEDDED IN THE  OPERATING  SYSTEM  OF  AN
ELECTRONIC  CASH REGISTER OR HARDWIRED INTO THE ELECTRONIC CASH REGISTER

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD08470-06-4

S. 3612--B                          2

THAT WITH INTENT OR BY SPECIFIC DESIGN  IS  USED  TO  CREATE  A  VIRTUAL
SECOND  TILL OR MAY ELIMINATE OR MANIPULATE TRANSACTION RECORDS THAT MAY
OR MAY NOT BE PRESERVED IN DIGITAL FORMATS  TO  REPRESENT  THE  TRUE  OR
MANIPULATED RECORD OF TRANSACTIONS IN THE ELECTRONIC CASH REGISTER.
  (4) "TRANSACTION DATA" MEANS DATA ASSOCIATED WITH ITEMS PURCHASED BY A
CUSTOMER,  THE  PRICE FOR EACH ITEM, A TAXABILITY DETERMINATION FOR EACH
ITEM, A SEGREGATED TAX AMOUNT FOR EACH OF THE TAXED ITEMS, THE AMOUNT OF
CASH OR CREDIT TENDERED, THE NET AMOUNT  RETURNED  TO  THE  CUSTOMER  IN
CHANGE,  THE DATE AND TIME OF THE PURCHASE, THE NAME, ADDRESS, AND IDEN-
TIFICATION NUMBER OF THE VENDOR, AND THE RECEIPT,  SEQUENCE  OR  INVOICE
NUMBER OF THE TRANSACTION.
  (5)  "TRANSACTION  REPORT" MEANS A REPORT DOCUMENTING DATA, INCLUDING,
BUT NOT LIMITED TO, DATA ASSOCIATED WITH SALES, TAXES  COLLECTED,  MEDIA
TOTALS, AND DISCOUNT VOIDS AT AN ELECTRONIC CASH REGISTER THAT IS PRINT-
ED ON CASH REGISTER TAPE AT THE END OF A DAY OR SHIFT, OR A REPORT DOCU-
MENTING EVERY ACTION AT AN ELECTRONIC CASH REGISTER THAT IS STORED ELEC-
TRONICALLY.
  (6)  "PERSON"  SHALL HAVE THE SAME DEFINITION AS IN SUBDIVISION (A) OF
SECTION ELEVEN HUNDRED ONE OF THIS CHAPTER.
  (B) PROHIBITIONS. (1) IT IS AN  OFFENSE  FOR  A  PERSON  TO  KNOWINGLY
PURCHASE,  POSSESS,  INSTALL, UPDATE, MAINTAIN, UPGRADE, TRANSFER OR USE
ANY AUTOMATED SALES SUPPRESSION DEVICE, ZAPPER OR PHANTOM-WARE.   IT  IS
ALSO  AN  OFFENSE  TO  TRANSMIT TRANSACTION DATA WITH THE INTENT OF DATA
MANIPULATION FOR THE PURPOSE OF EVADING ANY TAXES UNDER THIS ARTICLE.
  (2) A VIOLATION OF PARAGRAPH ONE OF THIS  SUBDIVISION  IS  A  CLASS  E
FELONY  PUNISHABLE  BY A FINE OF NOT LESS THAN FIVE THOUSAND DOLLARS BUT
NOT MORE THAN TWENTY-FIVE THOUSAND DOLLARS AND,  FOR  A  SECOND  OFFENSE
WITHIN  FIVE  YEARS,  BY  A  FINE  OF NOT LESS THAN TWENTY-FIVE THOUSAND
DOLLARS BUT NOT MORE THAN ONE HUNDRED THOUSAND DOLLARS AND, FOR A  THIRD
OR  SUBSEQUENT  OFFENSE WITHIN TEN YEARS, BY A FINE OF NOT LESS THAN ONE
HUNDRED THOUSAND  DOLLARS  BUT  NOT  MORE  THAN  FIVE  HUNDRED  THOUSAND
DOLLARS.
  (3)  IT  IS  AN  OFFENSE  FOR A PERSON TO KNOWINGLY SELL ANY AUTOMATED
SALES SUPPRESSION DEVICE, ZAPPER OR PHANTOM-WARE.
  (4) A VIOLATION OF PARAGRAPH THREE OF THIS SUBDIVISION IS  A  CLASS  E
FELONY  PUNISHABLE  BY  A FINE OF TWENTY-FIVE THOUSAND DOLLARS PER INCI-
DENT.
  (5) THE OFFENSES CREATED BY THIS SECTION SHALL BE IN ADDITION  TO  AND
CONSIDERED  A  SEPARATE  OFFENSE  FROM  ANY  OFFENSE OF SECTION EIGHTEEN
HUNDRED SEVENTEEN OF THIS PART.
  S 2. This act shall take effect January 1, 2016.

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