Senate Bill S4144A

                                 
BILL NUMBER: S4144A

SPONSOR: MANNION
 
TITLE OF BILL:

An act to amend the tax law, in relation to increasing the sale price
threshold for food and drink sold in vending machines to be exempt from
certain taxation

 
PURPOSE:

The purpose of this bill is to increase the exemption from sales and use
taxes for food and drink items sold through any vending machine from the
current exemption amount of $1.50 to $3.00 and $2.00 to $3.50 for
purchases made with physical currency and any form of payment, respec-
tively.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1 of this bill would amend section 1115 of the Tax Law to
increase the exemption from sales and use taxes for food and drink items
sold through any vending machine from the current exemption amount of
              

$1.50 to $3.00 and $2.00 to $3.50 for purchases made with physical
currency and any form of payment, respectively.

Section 2 of this bill provides that the effective date shall take
effect immediately.

 
JUSTIFICATION:

In 1997, legislation was enacted that removed the state and local sales
tax from vended hot drink sales and some snack items. In 2000, legis-
lation was enacted that exempted all vended sales, including candy and
carbonated drinks, costing 75 cents or less. In 2014, that exemption was
increased from sales of 75 cents and under to sales of $1.50 and under.
In 2019, that exemption was increased from sales of $1.50 and under to
$2.00 and under. This continual increase of sales tax exemption has
allowed for New York State's vending machine industry to reinvest in
their businesses, thus permitting many to acquire newer machinery to
make available more New York State based agricultural products, such as
yogurt and cheese, to consumers. This also has allowed the industry to
respond to customers' demand for more nutritious and health conscious
foods and drinks. In addition, the "Taste NY" program is bolstered by
the vending machine sales tax exemption.

This bill would provide the vendors operating within the State the
necessary financial relief they need to be competitive with other
outlets, and would preserve and promote the growth of jobs and avail-
ability of New York State locally produced products. it would enable
some 200 vendors, mostly small businesses (about half of whom are sole
proprietor or "mom and pop" businesses), to remain in business given the
rising costs of doing business.

 
PRIOR LEGISLATIVE HISTORY:

2021-22: S.8339-A (Kaplan) - Referred to Budget and Revenue.

2019-20: S.4367-A (Kaplan) - Referred to Budget and Revenue.

2017-18: S.4653 (Boyle) - Referred to Investigations and Government
Operations.

 
FISCAL IMPLICATIONS:

Additional $4 million per year.

 
EFFECTIVE DATE:
This act shall take effect immediately.