Albany – New York State Senator Michael F. Nozzolio today called on Governor Eliot Spitzer to enforce New York State law and begin collecting sales taxes on cigarettes sold by Native American retailers.
Under current law, cigarettes sold by Indians to non-Indians must include sales taxes. However, Indian businesses continue to refuse to pay the sales tax, causing an unfair advantage over competing retailers.
“It is very disconcerting that the State Department of Taxation still has not yet begun enforcing the law and collecting sales taxes from Indian owned businesses,” said Senator Nozzolio. “The current situation continues to cause an unfair economic disadvantage for our State’s other retailers, particularly for those who operate their businesses near the Indian reservations.”
“It is imperative that Governor Spitzer demand the State Tax Department begin the immediate collection of sales taxes from Native American owned businesses so that a level playing field is established for all merchants” continued Nozzolio.
In a letter to Governor Spitzer, Senator Nozzolio reminded the Governor that his Executive budget included $200 million in revenues that were expected to come from the collection of sales taxes from Native American businesses this year. The failure to collect the taxes could leave New York State at risk for a budget shortfall in the future.
Last year, Senator Nozzolio sponsored legislation that was signed into law requiring the State Department of Taxation and Finance to collect taxes on all retail sales by Native Americans to non-Native Americans. Since taking office, the Governor has stalled steps to enforce the law.
“Governor Spitzer has the power to correct this inequity and order the Department of Taxation to begin the collection of these taxes. This issue has a strong impact on the financial stability of our counties and local governments and on the ability of our local businesses to remain economically viable and competitive in our region. As the State Senator representing the Finger Lakes region, I am calling upon Governor Spitzer to address this critical issue,” concluded Nozzolio.
Attached is Senator Nozzolio’s letter to Governor Spitzer.
Governor Eliot Spitzer
Albany, NY 12224
Dear Governor Spitzer:
In the past, your administration has indicated support for legislation requiring Native American owned businesses pay sales taxes on cigarette and gasoline sales. Your administration also included over $200 million in the State budget in planned revenues from the collection of the sales tax from these businesses.
It is now September and the State Department of Taxation and Finance has not implemented guidelines to collect these taxes. This lack of action could result in a budget shortfall in next year’s New York State budget.
As such, I believe it is imperative that you authorize the Department of Taxation to enforce the law and immediately begin collecting sales taxes from Native American owned businesses.
The on-going disparity in the collection of taxes continues to create an unfair economic disadvantage for our State’s retailers, particularly those who operate their businesses near Native American retailers. Action to begin the collection of the taxes would help ensure fairness and a level playing field for New York’s taxpaying retailers.
As you know, this issue has a strong impact on the ability of our local businesses to remain economically viable and competitive and on the financial stability of our counties and local governments.
It is my hope that you will recognize the immediate need to address this situation and mandate the Department of Taxation to begin the collection of these taxes.
Thank you for your immediate review and consideration of this very important matter.
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