§ 1235. Taxes paid to other jurisdictions. (a) With respect to taxes
imposed pursuant to subdivision (a) of section twelve hundred ten and
pursuant to section twelve hundred eleven, the use of tangible personal
property purchased at retail and of any of the services subject to the
sales tax shall be exempt from the compensating use tax authorized under
subdivision (a) of such section twelve hundred ten and under section
twelve hundred eleven, to the extent that a retail sales tax or a
compensating use tax was legally due and paid thereon, without any right
to a refund or credit thereof, to (1) any municipal corporation in this
state or (2) any other state or jurisdiction within any other state, but
only when it is shown that such other state or jurisdiction allows a
corresponding exemption with respect to the sale or use of tangible
personal property or of any of the services upon which such a sale or
compensating use tax was paid to this state and any of its municipal
corporations, except as provided in subdivision (b) of this section.

(b) To the extent that a compensating use tax imposed pursuant to this
article and the compensating use tax imposed by article twenty-eight are
at a higher aggregate rate than the rate of tax imposed in any other
state or jurisdiction within any other state, the exemption provided in
subdivision (a) of this section shall be inapplicable and the taxes
imposed pursuant to this article and by article twenty-eight shall apply
to the extent of the difference between such aggregate rate and the rate
paid in such other state or jurisdiction. In such event, the amount
payable shall be allocated between the tax imposed pursuant to this
article and the tax imposed by article twenty-eight in proportion to the
respective rates of such taxes. Where a retail sales tax or a
compensating use tax was legally due and paid to any municipal
corporation in this state, without any right to a refund or credit
thereof, with respect to the sale or use of tangible personal property
or any of the services subject to sales or compensating use tax, if the
use of such property or services is then subject to a compensating use
tax imposed by any other municipal corporation in this state and such
tax is at a higher rate than the rate of tax imposed by the first
municipal corporation, the tax of the municipal corporation with the
higher rate shall also apply but only to the extent of the difference in
such rates and such tax shall be distributable to such municipal
corporation, pursuant to section twelve hundred sixty-one, without
allocation as hereinabove provided. Where a retail sales tax or a
compensating use tax was legally due and paid to this state only, with
respect to the sale or use of tangible personal property or any of the
services subject to sales or compensating use tax, if the use of such
property or services is then subject to a compensating use tax imposed
by a municipal corporation in this state, such tax shall be
distributable to the municipal corporation, pursuant to section twelve
hundred sixty-one, without allocation as hereinabove provided.

(c) For purposes of this section, a payment to the tax commission of a
tax imposed by a municipal corporation shall be deemed a payment to such
municipal corporation.