Assembly Bill A7588

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7588
 
                        2025-2026 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               April 1, 2025
                                ___________
 
 Introduced  by  M.  of  A.  CUNNINGHAM  -- read once and referred to the
   Committee on Ways and Means
 
 AN ACT to amend the tax law, in relation to enacting the "New York small
   business growth and support act"
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1.  Short  title. This act shall be known and may be cited as
 the "New York small business growth and support act".
   § 2. Legislative findings and intent. The legislature finds that small
 businesses are the backbone of New York's economy and essential  to  the
 vitality  of  local communities. However, high operational costs and tax
 burdens in the early stages of a business can hinder growth and sustain-
 ability. By providing a  temporary  tax  exemption,  this  act  aims  to
 support  entrepreneurs,  stimulate  job creation, and encourage economic
 development across the state.
   § 3. The tax law is amended by adding a new section 43-a  to  read  as
 follows:
   §  43-A.  TAX EXEMPTION FOR NEWLY ESTABLISHED SMALL BUSINESSES. 1. FOR
 THE PURPOSES OF THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOW-
 ING MEANINGS:
   (A) "SMALL  BUSINESS"  MEANS  A  BUSINESS  ENTITY,  INCLUDING  A  SOLE
 PROPRIETORSHIP,  PARTNERSHIP, LIMITED LIABILITY COMPANY, OR CORPORATION,
 THAT:
   (I) EMPLOYS NO MORE THAN FIFTY FULL-TIME EQUIVALENT EMPLOYEES; AND
   (II) HAS ANNUAL GROSS RECEIPTS NOT EXCEEDING FIVE MILLION DOLLARS; AND
   (B) "NEWLY ESTABLISHED SMALL BUSINESS" MEANS A SMALL BUSINESS THAT HAS
 BEEN IN OPERATION FOR NO MORE THAN THREE YEARS.
   2. (A) FOR TAXABLE YEARS BEGINNING ON AND AFTER THE EFFECTIVE DATE  OF
 THIS  SECTION,  A  NEWLY ESTABLISHED SMALL BUSINESS SHALL BE EXEMPT FROM
 THE FOLLOWING TAXES DURING ITS FIRST THREE YEARS OF OPERATION:
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD10398-01-5
 A. 7588                             2
              

 
   (I) STATE INCOME TAX ON BUSINESS INCOME UNDER ARTICLE NINE-A  OF  THIS
 CHAPTER;
   (II)  FRANCHISE  TAX  ON BUSINESS CORPORATIONS UNDER ARTICLE NINE-A OF
 THIS CHAPTER; AND
   (III) METROPOLITAN COMMUTER TRANSPORTATION MOBILITY TAX UNDER  ARTICLE
 TWENTY-THREE OF THIS CHAPTER, IF APPLICABLE.
   (B) IN ORDER TO BE ELIGIBLE FOR THE TAX EXEMPTIONS UNDER THIS SECTION,
 SUCH NEWLY ESTABLISHED SMALL BUSINESS SHALL:
   (I) REGISTER WITH THE DEPARTMENT WITHIN SIX MONTHS OF COMMENCING OPER-
 ATIONS;
   (II) FILE AN ANNUAL STATEMENT WITH THE DEPARTMENT CERTIFYING CONTINUED
 ELIGIBILITY; AND
   (III)  REMAIN  IN  COMPLIANCE  WITH  ALL  APPLICABLE FEDERAL AND STATE
 LABOR, HEALTH, AND SAFETY LAWS.
   (C) THE EXEMPTIONS AUTHORIZED IN PARAGRAPH  (A)  OF  THIS  SUBDIVISION
 SHALL NOT APPLY TO:
   (I) BUSINESSES PRIMARILY ENGAGED IN THE SALE OR DISTRIBUTION OF TOBAC-
 CO, ALCOHOL, OR FIREARMS; AND
   (II)  PROFESSIONAL  SERVICE  CORPORATIONS,  AS  DEFINED  UNDER ARTICLE
 FIFTEEN OF THE BUSINESS CORPORATION LAW.
   3. IF A NEWLY ESTABLISHED SMALL BUSINESS CEASES  OPERATIONS  OR  RELO-
 CATES  OUTSIDE  NEW  YORK  STATE  WITHIN  FIVE  YEARS  OF  CLAIMING  THE
 EXEMPTIONS AUTHORIZED UNDER THIS SECTION, THE AMOUNT OF  THE  EXEMPTIONS
 SHALL  BE  ADDED  BACK  TO TAX IN THE TAXABLE YEAR IN WHICH THE BUSINESS
 CEASES OPERATIONS OR RELOCATES.
   4. THE DEPARTMENT SHALL PROMULGATE RULES AND REGULATIONS NECESSARY FOR
 THE IMPLEMENTATION OF THIS SECTION.
   5. CROSS-REFERENCES. FOR APPLICATION OF THE EXEMPTIONS PROVIDED FOR IN
 THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
   (A) ARTICLE 9-A: SECTION 209, SUBDIVISION 13;
   (B) ARTICLE 23: SECTION 803, SUBDIVISION (B).
   § 4. Section 209 of the tax law is amended by adding a new subdivision
 13 to read as follows:
   13. A NEWLY ESTABLISHED SMALL BUSINESS, AS DEFINED IN  SECTION  FORTY-
 THREE-A  OF  THIS  CHAPTER,  SHALL  BE  EXEMPT  FROM  TAXATION UNDER THE
 PROVISIONS OF THIS ARTICLE FOR THE PERIOD DESCRIBED  IN  SECTION  FORTY-
 THREE-A OF THIS CHAPTER.
   § 5. Section 803 of the tax law is amended by adding a new subdivision
 (c) to read as follows:
   (C)  IF  A  NEWLY  ESTABLISHED  SMALL  BUSINESS, AS DEFINED IN SECTION
 FORTY-THREE-A OF THIS CHAPTER, IS LOCATED WITHIN THE MCTD, SUCH BUSINESS
 SHALL BE EXEMPT FROM THE TAX IMPOSED UNDER THIS ARTICLE FOR  THE  PERIOD
 DESCRIBED IN SECTION FORTY-THREE-A OF THIS CHAPTER.
   § 6. Severability clause. If any clause, sentence, paragraph, subdivi-
 sion,  section  or  part  of  this act shall be adjudged by any court of
 competent jurisdiction to be invalid, such judgment  shall  not  affect,
 impair,  or  invalidate  the remainder thereof, but shall be confined in
 its operation to the clause, sentence, paragraph,  subdivision,  section
 or part thereof directly involved in the controversy in which such judg-
 ment shall have been rendered. It is hereby declared to be the intent of
 the  legislature  that  this  act  would  have been enacted even if such
 invalid provisions had not been included herein.
   § 7. This act shall take effect immediately.