NY State Senate Bill 2011-S6879

Senate Bill S6879

2011-2012 Legislative Session

Provides motor fuel tax exemption for sales of diesel motor fuel made to commercial fishermen

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Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Apr 30, 2012	print number 6879a
Apr 30, 2012	amend (t) and recommit to investigations and government operations
Apr 04, 2012	referred to investigations and government operations

Bill Amendments

Original

A (Active)

2011-S6879 - Details

See Assembly Version of this Bill:: A7271
Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Amd §§282-a, 301-b, 1115, 300, 301-a, 301-c & 1210, Tax L
Versions Introduced in Other Legislative Sessions:: 2013-2014: S782, A138
2015-2016: S331, A152
2017-2018: S1600, A938
2019-2020: S3183, A4478
2021-2022: S5164, A5815
2023-2024: S2091, A3869

2011-S6879 - Summary

Eliminates provisions of law that require the payment and subsequent refund of the ten cent diesel excise tax and sales tax on diesel motor fuel when sold to operators of commercial fishing vessels for use in the operation of such vessels.

2011-S6879 - Sponsor Memo

                                BILL NUMBER:S6879

TITLE OF BILL:
An act
to amend the tax law, in relation to providing an exemption from the
payment of the motor fuels tax and the sales tax on motor fuels
used in the operation of commercial fishing vessels; and
to amend the tax law, in relation to exempting fuel used in vessels used
directly and predominantly in a business providing sport
fishing opportunities for hire to the general public
from the tax on petroleum businesses and from
sales and compensating use taxes

PURPOSE:
Provides fuel tax exemption for fuels used in the operation of
commercial and commercial sport fishing vessels.

SUMMARY OF PROVISIONS:
This bill amends the tax law in order to eliminate the statute that
requires the payment and subsequent refund of the eight cent diesel
excise tax and the sales tax on diesel fuel when sold to operators of
commercial fishing vessels. Under the current law, both taxes must be
paid by commercial fishermen, notwithstanding their exempt status
from these taxes. The commercial fishermen are then allowed to file
for a refund of these taxes from the Department of Taxation and
Finance.

The tax law is further amended to grant an exemption from the
petroleum business tax and sales and compensating use taxes for fuel
used in vessels providing sport fishing opportunities for hire to the
general public.

JUSTIFICATION:
The original intent of this policy, as it relates to commercial
fishing vessels, was to prevent tax evasion in the diesel fuel
industry. However, it was not intended to be burdensome to many of
the state's industries such as commercial fishermen and their fuel
distributors.

The implementation of this law has caused a great deal of hardship for
commercial fishermen. A fisherman, operating a trawler vessel burning
85,000 gallons per year, must advance approximately $13,600 annually
in taxes to the State. The negative financial consequences of this
cash flow are a large burden for the commercial fishermen of this
state.

The negative impacts of this law have also been carried over to the
fuel distributors of the commercial fishermen. Because of the payment
requirement, many fishermen are now purchasing their fuel at ports
outside of New York. This will result in the loss of thousands of
dollars in revenue for the state's fuel distributors. This

legislation would no longer require commercial fishermen to pay any
excise or state sales taxes for the purchase of diesel motor fuel.
This legislation would also provide a full exemption from both the
petroleum business tax and sales and compensating use tax for charter
boats used directly and predominantly in a business providing sport
fishing opportunities for hire to the general public.

LEGISLATIVE HISTORY:
2009-10: A.1903A
2007-08: A.989
2005-06: A.3854
2003-04: A.1416
2001-02: A.2289
1999-00: A.2840A

FISCAL IMPLICATIONS:
To be determined.

EFFECTIVE DATE:
This act shall take effect on the first day of a sales tax quarterly
period, as described in subdivision (b) of section 1136 of the tax
law, next commencing at least ninety days after this act shall have
become a law, provided, however, that the amendments made to paragraph
(b) of subdivision 3 and subdivision 4, made by sections one and two
of this act, respectively, shall take effect on the same date and in
the same manner as section 5 of part K of chapter 61 of the laws of
2011, takes effect; and sections four and five of this act shall apply
to sales made under and uses occurring on or after the dates such
sections four and five shall have taken effect, respectively, although
made or occurring under a prior contract, provided that the amendments
to subdivision (j) of section 1115 of the tax law made by sections four
and five of this act, respectively, shall take effect on the same date
and in the same manner as section 41 of part K of chapter 61 of the laws
of 2011, takes effect; provided further that such amendments made by
section four of this act shall be subject to the expiration and
reversion of such subdivision pursuant to section 19 of part W-1 of
chapter 109 of the Laws of 2006, when upon such date the provisions
of section five of this act shall take effect; provided, further,
that sections six, seven, nine, ten and eleven of this act shall take
effect June 1, 2011; provided, further that the amendments made to
subparagraph (B) of paragraph 1 of subdivision (c) of section 301-a
of the tax law made by section eight of this act shall take effect
on the same date and in the same manner as section 19 of part K of
chapter 61 of the laws of 2011, takes effect; provided, further,
that the amendments to the opening paragraph of section 301-c
of the tax law, made by section nine of this act shall not affect
the expiration and repeal of such paragraph pursuant to section 19
of part W-1 of chapter 109 of the laws of 2006, as amended, and
shall expire and be deemed repealed therewith, when upon such date
the provisions of section this of this act shall take effect.

2011-S6879 - Bill Text download pdf

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

                                  6879

                            I N  S E N A T E

                              April 4, 2012
                               ___________

Introduced  by  Sen. LAVALLE -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the tax law, in relation to providing an exemption  from
  the  payment  of  the motor fuels tax and the sales tax on motor fuels
  used in the operation of commercial fishing vessels; and to amend  the
  tax  law,  in relation to exempting fuel used in vessels used directly
  and predominantly in a business providing sport fishing  opportunities
  for  hire  to  the general public from the tax on petroleum businesses
  and from sales and compensating use taxes

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1.  Paragraph (b) of subdivision 3 of section 282-a of the tax
law,  as  amended  by  section  5 of part K of chapter 61 of the laws of
2011, is amended to read as follows:
  (b) The tax on the incidence of sale or use imposed by subdivision one
of this section shall not apply to: (i) the sale or use  of  non-highway
Diesel  motor  fuel, but only if all of such fuel is consumed other than
on the public highways of this state (except for the use of  the  public
highway by farmers to reach adjacent farmlands); provided, however, this
exemption  shall in no event apply to a sale of non-highway Diesel motor
fuel which involves a delivery at a filling station or into a repository
which is equipped with a hose or other apparatus by which such fuel  can
be  dispensed into the fuel tank of a motor vehicle (except for delivery
at a farm site which qualifies for the exemption under  subdivision  (g)
of  section  three hundred one-b of this chapter); or (ii) a sale to the
consumer consisting of not more than twenty gallons of water-white kero-
sene to be used and consumed exclusively for heating purposes; or  (iii)
the  sale  to or delivery at a filling station or other retail vendor of
water-white kerosene provided  such  filling  station  or  other  retail
vendor  only  sells  such  water-white  kerosene exclusively for heating
purposes in containers of no more than twenty gallons; or (iv) a sale of
kero-jet fuel to an airline for use in its airplanes or a use  of  kero-
jet  fuel by an airline in its airplanes; or (v) a sale of kero-jet fuel

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

                                                           LBD10686-02-1

S. 6879                             2

by a registered distributor of Diesel motor fuel to a fixed base  opera-
tor registered under this article as a distributor of kero-jet fuel only
where  such  fixed base operator is engaged solely in making or offering
to make retail sales not in bulk of kero-jet fuel directly into the fuel
tank  of an airplane for the purpose of operating such airplane; or (vi)
a retail sale not in bulk of kero-jet fuel  by  a  fixed  base  operator
registered  under  this  article  as a distributor of kero-jet fuel only
where such fuel is delivered directly into the fuel tank of an  airplane
for  use  in  the  operation of such airplane; OR (VII) A SALE OF DIESEL
MOTOR FUEL TO A "COMMERCIAL FISHERMAN",  AS  SUCH  TERM  IS  DEFINED  IN
SUBDIVISION  (I)  OF  SECTION  THREE  HUNDRED OF THIS CHAPTER, AT RETAIL
UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH ONE OF SUBDIVISION (G) OF
SECTION THREE HUNDRED ONE-C OF THIS CHAPTER, AND WHERE  SUCH  COMMERCIAL
FISHING VESSEL IS OPERATED BY A COMMERCIAL FISHERMAN.
  S  2.  Subdivision  4  of  section 282-a of the tax law, as amended by
section 5 of part K of chapter 61 of the laws of  2011,  is  amended  to
read as follows:
  4.  The  tax  imposed  by  this  section on Diesel motor fuel shall be
passed through by the seller and included as part of the  selling  price
to each purchaser of such fuel. Provided, however, the amount of the tax
imposed by this section may be excluded from the selling price of Diesel
motor fuel where (i) a sale of Diesel motor fuel is made to an organiza-
tion  described  in  paragraph  (a) of subdivision three of this section
solely for the purpose stated therein; (ii) a sale of non-highway Diesel
motor fuel is made to a consumer but only  if  such  non-highway  Diesel
motor  fuel  is not delivered to a filling station, nor delivered into a
storage tank which is equipped with a hose or other apparatus  by  which
such  fuel  can  be  dispensed into the fuel tank of a motor vehicle; or
(iii) the sale to or delivery at  a  filling  station  or  other  retail
vendor  of  water-white  kerosene provided such filling station or other
retail vendor only sells such water-white kerosene exclusively for heat-
ing purposes in containers of no more than twenty  gallons;  or  (iv)  a
sale of kero-jet fuel is made to an airline for use in its airplanes; OR
(V)  A SALE OF DIESEL MOTOR FUEL IS MADE TO A "COMMERCIAL FISHERMAN", AS
SUCH TERM IS DEFINED IN SUBDIVISION (I) OF SECTION THREE HUNDRED OF THIS
CHAPTER, AT RETAIL UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH ONE OF
SUBDIVISION (G) OF SECTION THREE HUNDRED  ONE-C  OF  THIS  CHAPTER,  AND
WHERE SUCH COMMERCIAL FISHING VESSEL IS OPERATED BY A COMMERCIAL FISHER-
MAN.
  S  3. Section 301-b of the tax law is amended by adding a new subdivi-
sion (k) to read as follows:
  (K) SALES OR USES OF DIESEL MOTOR FUEL AND RESIDUAL PETROLEUM  PRODUCT
FOR  COMMERCIAL FISHING. DIESEL MOTOR FUEL OR RESIDUAL PETROLEUM PRODUCT
SOLD TO OR USED BY A "COMMERCIAL FISHERMAN", AS SUCH TERM IS DEFINED  IN
SUBDIVISION  (I)  OF  SECTION  THREE  HUNDRED OF THIS ARTICLE, AT RETAIL
UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH ONE OF SUBDIVISION (G) OF
SECTION THREE HUNDRED ONE-C OF THIS ARTICLE, AND WHERE  SUCH  COMMERCIAL
FISHING VESSEL IS OPERATED BY A COMMERCIAL FISHERMAN.
  S  4.  Subdivision  (j)  of section 1115 of the tax law, as amended by
section 41 of part K of chapter 61 of the laws of 2011,  is  amended  to
read as follows:
  (j) The exemptions provided in this section shall not apply to the tax
required  to  be  prepaid  pursuant  to the provisions of section eleven
hundred two of this article nor to the taxes imposed by sections  eleven
hundred  five  and  eleven  hundred  ten of this article with respect to
receipts from sales and uses of motor fuel or diesel motor fuel,  except

S. 6879                             3

that  the exemptions provided in paragraphs nine and forty-two of subdi-
vision (a) of this section shall apply to the tax required to be prepaid
pursuant to the provisions of section eleven hundred two of this article
and  to  the  taxes  imposed  by sections eleven hundred five and eleven
hundred ten of this article with respect to sales and uses  of  kero-jet
fuel,  CNG,  hydrogen  and E85, provided, however, the exemption allowed
for E85 shall be subject to  the  additional  requirements  provided  in
section  eleven  hundred  two  of  this  article with respect to E85 AND
EXCEPT THAT THE EXEMPTION PROVIDED IN PARAGRAPH TWENTY-FOUR OF  SUBDIVI-
SION  (A)  OF  THIS SECTION SHALL APPLY TO THE TAXES IMPOSED BY SECTIONS
ELEVEN HUNDRED FIVE AND ELEVEN HUNDRED TEN OF THIS ARTICLE WITH  RESPECT
TO  SALES AND USES OF DIESEL MOTOR FUEL USED IN THE OPERATION OF A FISH-
ING VESSEL AS DESCRIBED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION  (A)  OF
THIS SECTION.  The exemption provided in subdivision (c) of this section
shall  apply to sales and uses of non-highway diesel motor fuel but only
if all of such fuel is consumed other than on  the  public  highways  of
this  state.   The exemption provided in subdivision (c) of this section
shall apply to sales and uses of non-highway diesel motor fuel  for  use
or  consumption  either  in the production for sale of tangible personal
property by farming or in a commercial horse boarding operation,  or  in
both  but  only if all of such fuel is consumed other than on the public
highways of this state (except for the use of  the  public  highways  to
reach  adjacent  farmlands  or adjacent lands used in a commercial horse
boarding operation, or both).
  S 5. Subdivision (j) of section 1115 of the tax  law,  as  amended  by
section  41-a of part K of chapter 61 of the laws of 2011, is amended to
read as follows:
  (j) The exemptions provided in this section shall not apply to the tax
required to be prepaid pursuant to  the  provisions  of  section  eleven
hundred  two of this article nor to the taxes imposed by sections eleven
hundred five and eleven hundred ten of  this  article  with  respect  to
receipts  from sales and uses of motor fuel or diesel motor fuel, except
that the exemption provided in paragraph nine of subdivision (a) of this
section shall apply to the tax required to be prepaid  pursuant  to  the
provisions  of  section  eleven  hundred  two of this article and to the
taxes imposed by sections eleven hundred five and eleven hundred ten  of
this  article with respect to sales and uses of kero-jet fuel AND EXCEPT
THAT THE EXEMPTION PROVIDED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION  (A)
OF  THIS  SECTION  SHALL  APPLY  TO THE TAXES IMPOSED BY SECTIONS ELEVEN
HUNDRED FIVE AND ELEVEN HUNDRED TEN OF  THIS  ARTICLE  WITH  RESPECT  TO
SALES  AND  USES OF DIESEL MOTOR FUEL USED IN THE OPERATION OF A FISHING
VESSEL AS DESCRIBED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION (A) OF  THIS
SECTION.    The  exemption  provided  in subdivision (c) of this section
shall apply to sales and uses of non-highway diesel motor fuel but  only
if  all  of  such  fuel is consumed other than on the public highways of
this state. The exemption provided in subdivision (c)  of  this  section
shall  apply  to sales and uses of non-highway diesel motor fuel for use
or consumption either in the production for sale  of  tangible  personal
property  by  farming or in a commercial horse boarding operation, or in
both but only if all of such fuel is consumed other than on  the  public
highways  of  this  state  (except for the use of the public highways to
reach adjacent farmlands or adjacent lands used in  a  commercial  horse
boarding operation, or both).
  S 6. Section 300 of the tax law is amended by adding a new subdivision
(j-1) to read as follows:

S. 6879                             4

  (J-1)  "COMMERCIAL  SPORT  FISHING  VESSEL"  MEANS A VESSEL OWNED BY A
PERSON DOMICILED IN THIS STATE, WHO HAS BEEN ISSUED AND HOLDS  A  MARINE
AND  COASTAL DISTRICT PARTY AND CHARTER BOAT LICENSE PURSUANT TO SECTION
13-0336 OF THE ENVIRONMENTAL CONSERVATION LAW.
  S  7.  Paragraph 2 of subdivision (b) of section 301-a of the tax law,
as added by section 154 of part A of chapter 389 of the laws of 1997, is
amended to read as follows:
  (2) Motor fuel brought into this state in  the  fuel  tank  connecting
with  the  engine  of  a  vessel propelled by the use of such motor fuel
shall be deemed to constitute a  taxable  use  of  motor  fuel  for  the
purposes  of this subdivision to the extent that the fuel is consumed in
the operation of the vessel in this state. Provided, however, that  this
paragraph  shall  not  apply  to  (i)  a recreational motor boat or (ii)
subsequent to  August  thirty-first,  nineteen  hundred  ninety-four,  a
commercial  fishing  vessel  (as  defined  in subdivision (j) of section
three hundred of this article) if the motor fuel imported  and  consumed
in  this state is used to operate such vessel while it is engaged in the
harvesting of fish for sale OR (III) A COMMERCIAL SPORT FISHING  VESSEL,
IF  SUCH VESSEL PROVIDES ITS OWNER WITH AT LEAST FIFTY PERCENT OF HIS OR
HER TOTAL ANNUAL INCOME.   Provided, further,  that  tax  liability  for
gallonage that a vessel consumes shall be the tax liability with respect
to  the positive difference between the gallonage consumed in this state
during the reporting period and the gallonage purchased  in  this  state
(upon  which  the tax imposed by this section has been paid) during such
period. A credit or refund shall be available  for  any  excess  of  tax
liability  for  gallonage purchased in this state during the period over
tax liability on gallonage so consumed in this state during such period,
which excess shall be presumed to have been used outside this state.
  S 8. Subparagraph (B) of paragraph 1 of  subdivision  (c)  of  section
301-a  of  the tax law, as amended by section 19 of part K of chapter 61
of the laws of 2011, is amended to read as follows:
  (B) Highway diesel motor fuel brought into this state in the fuel tank
connecting with the engine of a vessel propelled  by  the  use  of  such
diesel  motor fuel shall be deemed to constitute a taxable use of diesel
motor fuel for the purpose of this paragraph to the extent of  the  fuel
that is consumed in the operation of the vessel in this state. Provided,
however, this paragraph shall not apply to (i) a recreational motor boat
or  (ii)  a  commercial fishing vessel (as defined in subdivision (j) of
section three hundred of this article) if the highway diesel motor  fuel
imported into and consumed in this state is used to operate such commer-
cial  fishing  vessel  while it is engaged in the harvesting of fish for
sale OR (III) A COMMERCIAL SPORT FISHING VESSEL, IF SUCH VESSEL PROVIDES
ITS OWNER WITH AT LEAST FIFTY PERCENT OF HIS OR HER TOTAL ANNUAL INCOME.
Provided, further, that  tax  liability  for  gallonage  that  a  vessel
consumes  in  this  state shall be the tax liability with respect to the
positive difference between the gallonage consumed in this state  during
the  reporting  period  and  the gallonage purchased in this state (upon
which the tax imposed by this section has been paid) during such period.
A credit or refund shall be available for any excess  of  tax  liability
for gallonage purchased in this state during the period over tax liabil-
ity  on  gallonage  so  consumed in this state during such period, which
excess shall be presumed to have been used outside this state.
  S 9. The opening paragraph of section 301-c of the tax law, as amended
by section 5 of part W-1 of chapter 109 of the laws of 2006, is  amended
to read as follows:

S. 6879                             5

  A subsequent purchaser shall be eligible for reimbursement of tax with
respect  to the following gallonage, subsequently sold by such purchaser
in accordance with subdivision (a), (b), (e), (h), (j), (k), (n) or  (o)
of this section or used by such purchaser in accordance with subdivision
(c), (d), (f), (g), (G-1), (i), (l) or (m) of this section, which gallo-
nage has been included in the measure of the tax imposed by this article
on a petroleum business:
  S  10.  The  opening  paragraph  of  section  301-c of the tax law, as
amended by chapter 468 of the laws  of  2000,  is  amended  to  read  as
follows:
  A subsequent purchaser shall be eligible for reimbursement of tax with
respect  to the following gallonage, subsequently sold by such purchaser
in accordance with subdivision (a), (b), (e), (h), (j) or  (k)  of  this
section  or  used  by such purchaser in accordance with subdivision (c),
(d), (f), (g), (G-1), (i), (l) or (m) of this section,  which  gallonage
has been included in the measure of the tax imposed by this article on a
petroleum business:
  S 11. Section 301-c of the tax law is amended by adding a new subdivi-
sion (g-1) to read as follows:
  (G-1)  DIESEL  MOTOR  FUEL  AND  MOTOR  FUEL  USED IN THE OPERATION OF
COMMERCIAL SPORT FISHING  VESSELS.  DIESEL  MOTOR  FUEL  OR  MOTOR  FUEL
PURCHASED  IN  THIS  STATE BY THE OPERATOR OF A COMMERCIAL SPORT FISHING
VESSEL AT RETAIL WHEREIN SUCH DIESEL MOTOR FUEL OR SUCH  MOTOR  FUEL  IS
DELIVERED  BY A PUMP EQUIPPED WITH A HOSE DIRECTLY INTO THE FUEL TANK OF
A COMMERCIAL SPORT FISHING VESSEL TO BE USED AS FUEL IN THE OPERATION OF
SUCH VESSEL FOR THE PURPOSE OF PROVIDING SPORT FISHING OPPORTUNITIES FOR
HIRE TO THE GENERAL PUBLIC; BUT ONLY WHERE (1) THE TAX IMPOSED  PURSUANT
TO  THIS ARTICLE HAS BEEN PAID WITH RESPECT TO SUCH DIESEL MOTOR FUEL OR
SUCH MOTOR FUEL AND THE ENTIRE AMOUNT OF SUCH TAX HAS BEEN  ABSORBED  BY
SUCH PURCHASER, (2) SUCH PURCHASER POSSESSES DOCUMENTARY PROOF SATISFAC-
TORY  TO  THE COMMISSIONER EVIDENCING THE ABSORPTION BY IT OF THE ENTIRE
AMOUNT OF THE TAX IMPOSED PURSUANT TO THIS ARTICLE, AND (3)  THE  VESSEL
PROVIDES ITS OWNER WITH AT LEAST FIFTY PERCENT OF HIS OR HER TOTAL ANNU-
AL  INCOME.  PROVIDED, HOWEVER, THAT THE COMMISSIONER SHALL REQUIRE SUCH
DOCUMENTARY PROOF TO QUALIFY FOR ANY REIMBURSEMENT OF  TAX  PROVIDED  BY
THIS SECTION AS THE COMMISSIONER DEEMS APPROPRIATE.
  S  12.  Subdivision  (a)  of section 1115 of the tax law is amended by
adding a new paragraph 24-a to read as follows:
  (24-A) FUEL USED IN VESSELS USED DIRECTLY AND PREDOMINANTLY IN A BUSI-
NESS PROVIDING SPORT FISHING  OPPORTUNITIES  FOR  HIRE  TO  THE  GENERAL
PUBLIC; PROVIDED THAT SUCH VESSEL PROVIDES ITS OWNER WITH AT LEAST FIFTY
PERCENT OF HIS OR HER TOTAL ANNUAL INCOME.
  S  13.  Subparagraph  (i) of paragraph 1 of subdivision (a) of section
1210 of the tax law, as amended by section 3 of part GG of chapter 57 of
the laws of 2010, is amended to read as follows:
  (i) Any local law, ordinance or resolution enacted by any city of less
than one million or by any county or school district, imposing the taxes
authorized by this subdivision, shall, notwithstanding any provision  of
law  to the contrary, exclude from the operation of such local taxes all
sales of tangible personal property for use or consumption directly  and
predominantly  in  the  production  of  tangible personal property, gas,
electricity, refrigeration or steam, for sale, by  manufacturing,  proc-
essing,  generating,  assembly,  refining, mining or extracting; and all
sales of tangible personal property for use or consumption predominantly
either in the production of tangible personal  property,  for  sale,  by
farming  or  in  a commercial horse boarding operation, or in both; and,

S. 6879                             6

unless such city, county or school district elects otherwise, shall omit
THE FUEL USED IN COMMERCIAL SPORT FISHING VESSELS EXEMPTION PROVIDED FOR
IN PARAGRAPH TWENTY-FOUR-A OF SUBDIVISION (A), the provision for  credit
or  refund contained in clause six of subdivision (a) or subdivision (d)
of section eleven hundred nineteen of this chapter.
  S 14. Section 1210 of the tax law is amended by adding a new  subdivi-
sion (p) to read as follows:
  (P)  NOTWITHSTANDING  ANY OTHER PROVISION OF STATE OR LOCAL LAW, ORDI-
NANCE OR RESOLUTION TO THE CONTRARY:
  (1) ANY CITY HAVING A POPULATION OF ONE MILLION OR MORE IN  WHICH  THE
TAXES  IMPOSED  BY  SECTION  ELEVEN HUNDRED SEVEN OF THIS CHAPTER ARE IN
EFFECT, ACTING THROUGH ITS LOCAL LEGISLATIVE BODY, IS HEREBY  AUTHORIZED
AND EMPOWERED TO ELECT TO PROVIDE THE SAME EXEMPTIONS FROM SUCH TAXES AS
THE  FUEL  USED IN COMMERCIAL SPORT FISHING VESSELS EXEMPTION FROM STATE
SALES AND COMPENSATING USE TAXES DESCRIBED IN PARAGRAPH TWENTY-FOUR-A OF
SUBDIVISION (A) OF SECTION ELEVEN HUNDRED FIFTEEN  OF  THIS  CHAPTER  BY
ENACTING  A  RESOLUTION  IN  THE FORM SET FORTH IN PARAGRAPH TWO OF THIS
SUBDIVISION; WHEREUPON, UPON COMPLIANCE WITH THE PROVISIONS OF  SUBDIVI-
SIONS  (D)  AND  (E)  OF THIS SECTION, SUCH ENACTMENT OF SUCH RESOLUTION
SHALL BE DEEMED TO BE AN AMENDMENT TO SUCH SECTION ELEVEN HUNDRED  SEVEN
AND  SUCH  SECTION  ELEVEN  HUNDRED SEVEN SHALL BE DEEMED TO INCORPORATE
SUCH EXEMPTIONS AS IF THEY HAD BEEN DULY ENACTED BY THE  STATE  LEGISLA-
TURE AND APPROVED BY THE GOVERNOR.
  (2)  FORM  OF RESOLUTION: BE IT ENACTED BY THE (INSERT PROPER TITLE OF
LOCAL LEGISLATIVE BODY) AS FOLLOWS:
  SECTION ONE.  RECEIPTS  FROM  SALES  OF  AND  CONSIDERATION  GIVEN  OR
CONTRACTED  TO  BE  GIVEN  FOR, OR FOR THE USE OF, PROPERTY AND SERVICES
EXEMPT FROM STATE SALES AND COMPENSATING USE TAXES PURSUANT TO PARAGRAPH
TWENTY-FOUR-A OF SUBDIVISION (A) OF SECTION 1115 OF THE  TAX  LAW  SHALL
ALSO  BE  EXEMPT  FROM  SALES AND COMPENSATING USE TAXES IMPOSED IN THIS
JURISDICTION.
  SECTION TWO. THIS RESOLUTION SHALL TAKE EFFECT  JUNE  1,  (INSERT  THE
YEAR, BUT NOT EARLIER THAN THE YEAR 2010) AND SHALL APPLY TO SALES MADE,
SERVICES  RENDERED  AND USES OCCURRING ON AND AFTER THAT DATE IN ACCORD-
ANCE WITH THE APPLICABLE TRANSITIONAL PROVISIONS IN SECTIONS 1106,  1216
AND 1217 OF THE NEW YORK TAX LAW.
  S  15.    This  act  shall take effect on the first day of a sales tax
quarterly period, as described in subdivision (b) of section 1136 of the
tax law, next commencing at least ninety days after this act shall  have
become  a  law, provided, however, that the amendments made to paragraph
(b) of subdivision 3 and subdivision 4, made by sections one and two  of
this  act,  respectively,  shall take effect on the same date and in the
same manner as section 5 of part K of chapter 61 of the  laws  of  2011,
takes  effect;  and  sections  four  and five of this act shall apply to
sales made under and uses occurring on or after the dates such  sections
four  and  five  shall have taken effect, respectively, although made or
occurring under a prior contract, provided that the amendments to subdi-
vision (j) of section 1115 of the tax law made by sections four and five
of this act, respectively, shall take effect on the same date and in the
same manner as section 41 of part K of chapter 61 of the laws  of  2011,
takes effect; provided further that such amendments made by section four
of  this  act  shall  be subject to the expiration and reversion of such
subdivision pursuant to section 19 of part W-1 of  chapter  109  of  the
laws  of 2006, as amended, when upon such date the provisions of section
five of this act shall take effect;  provided,  further,  that  sections
six,  seven,  nine, ten and eleven of this act shall take effect June 1,

S. 6879                             7

2011; provided, further, that the amendments made to subparagraph (B) of
paragraph 1 of subdivision (c) of section 301-a of the tax law  made  by
section  eight of this act shall take effect on the same date and in the
same  manner  as section 19 of part K of chapter 61 of the laws of 2011,
takes effect; provided, further, that  the  amendments  to  the  opening
paragraph  of section 301-c of the tax law, made by section nine of this
act shall not affect the expiration and repeal of such paragraph  pursu-
ant  to  section  19  of part W-1 of chapter 109 of the laws of 2006, as
amended, and shall expire and be deemed repealed  therewith,  when  upon
such date the provisions of section ten of this act shall take effect.

2011-S6879A (ACTIVE) - Details

See Assembly Version of this Bill:: A7271
Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Amd §§282-a, 301-b, 1115, 300, 301-a, 301-c & 1210, Tax L
Versions Introduced in Other Legislative Sessions:: 2013-2014: S782, A138
2015-2016: S331, A152
2017-2018: S1600, A938
2019-2020: S3183, A4478
2021-2022: S5164, A5815
2023-2024: S2091, A3869

2011-S6879A (ACTIVE) - Summary

2011-S6879A (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S6879A

TITLE OF BILL:

An act
to amend the tax law, in relation to providing an exemption from the
payment of the motor fuels tax and the sales tax on motor fuels
used in the operation of commercial fishing vessels

PURPOSE OR GENERAL IDEA OF BILL:

Provides a motor fuel tax exemption for sales of diesel motor fuel
made to commercial fishermen.

SUMMARY OF SPECIFIC PROVISIONS:

This bill amends the Tax Law in order to eliminate the statute that
requires the payment and subsequent refund of the eight cent diesel
excise tax and the sales tax on diesel fuel when sold to operators of
commercial fishing vessels. Under the current law, both taxes must be
paid by commercial fishermen, notwithstanding their exempt status
from these taxes. The commercial fishermen are then allowed to file
for a refund of these taxes from the Department of Taxation and
Finance.

JUSTIFICATION:

The original intent of this policy, as it relates to commercial
fishing vessels, was to prevent tax evasion in the diesel fuel
industry.
However, it was not intended to be burdensome to many of the state's
industries such as commercial fishermen and their fuel distributors.

The implementation of this law has caused a great deal of hardship for
commercial fishermen. A fisherman, operating a trawler vessel burning
85,000 gallons per year, must advance approximately $13,600 annually
in taxes to the State. The negative financial consequences of this
cash flow are a large burden for the commercial fishermen of this
state.

The negative impacts of this law have also been carried over to the
fuel distributors of the commercial fishermen. Because of the payment
requirement, many fishermen are now purchasing their fuel at ports
outside of New York. This will result in the loss of thousands of
dollars in revenue for the state's fuel distributors.

This legislation would no longer require commercial fishermen to pay
any excise or state sales taxes for the purchase of diesel motor fuel.

PRIOR LEGISLATIVE HISTORY:

2009-10: A.1903-A
2007-08: A.989
2005-06: A.3854
2003-04, A.1416
2001-02, A.2289
1999-00, A.2840A
1997-98: A.2180

FISCAL IMPLICATIONS:

To be determined.

EFFECTIVE DATE:

This act shall take effect on the first day of a sales tax quarterly
period, as described in subdivision (b) of Section 1136 of the tax
law, next commencing at least ninety days after this act shall have
become a law, sections four and five of this act shall apply to sales
made under and uses occurring on or after the dates such sections
four and five shall have taken effect, respectively, although made or
occurring under a prior contract; and provided further that the
amendments made by section four of this act shall be subject to the
expiration and reversion of such subdivision pursuant to Section 19
of part W-1 of Chapter 109 of the laws of 2006, as amended, when upon
such date the provisions of section five of this act shall take effect.

2011-S6879A (ACTIVE) - Bill Text download pdf

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

                                 6879--A

                            I N  S E N A T E

                              April 4, 2012
                               ___________

Introduced  by  Sen. LAVALLE -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment  Operations  --  committee  discharged,  bill  amended,   ordered
  reprinted as amended and recommitted to said committee

AN  ACT to amend the tax law, in relation to providing an exemption from
  the payment of the motor fuels tax and the sales tax  on  motor  fuels
  used in the operation of commercial fishing vessels

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1.  Paragraph (b) of subdivision 3 of section 282-a of the tax
law, as amended by section 2 of part E of chapter  59  of  the  laws  of
2012, is amended to read as follows:
  (b) The tax on the incidence of sale or use imposed by subdivision one
of  this  section shall not apply to: (i) the sale or use of non-highway
Diesel motor fuel, but only if all of such fuel is consumed  other  than
on  the  public highways of this state (except for the use of the public
highway by farmers to reach adjacent farmlands); provided, however, this
exemption shall in no event apply to a sale of non-highway Diesel  motor
fuel which involves a delivery at a filling station or into a repository
which  is equipped with a hose or other apparatus by which such fuel can
be dispensed into the fuel tank of a motor vehicle (except for  delivery
at  a  farm site which qualifies for the exemption under subdivision (g)
of section three hundred one-b of this chapter); or (ii) a sale  to  the
consumer consisting of not more than twenty gallons of water-white kero-
sene  to be used and consumed exclusively for heating purposes; or (iii)
the sale to or delivery at a filling station or other retail  vendor  of
water-white  kerosene  provided  such  filling  station  or other retail
vendor only sells such  water-white  kerosene  exclusively  for  heating
purposes in containers of no more than twenty gallons; or (iv) a sale of
kero-jet  fuel  to an airline for use in its airplanes or a use of kero-
jet fuel by an airline in its airplanes; or (v) a sale of kero-jet  fuel
by  a registered distributor of Diesel motor fuel to a fixed base opera-
tor registered under this article as a distributor of kero-jet fuel only
where such fixed base operator is engaged solely in making  or  offering

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

                                                           LBD10686-04-2

S. 6879--A                          2

to make retail sales not in bulk of kero-jet fuel directly into the fuel
tank  of  an airplane for the purpose of operating such airplane; (vi) a
retail sale not in bulk of kero-jet fuel by a fixed base operator regis-
tered  under  this  article as a distributor of kero-jet fuel only where
such fuel is delivered directly into the fuel tank of  an  airplane  for
use  in  the operation of such airplane; or (vii) the sale of previously
untaxed qualified biodiesel to a person registered under this article as
a distributor of Diesel motor fuel other than (A) a retail sale to  such
person or (B) a sale to such person which involves a delivery at a fill-
ing  station or into a repository which is equipped with a hose or other
apparatus by which such qualified biodiesel can be  dispensed  into  the
fuel tank of a motor vehicle; OR (VIII) A SALE OF DIESEL MOTOR FUEL TO A
"COMMERCIAL  FISHERMAN",  AS  SUCH TERM IS DEFINED IN SUBDIVISION (I) OF
SECTION THREE HUNDRED OF THIS CHAPTER, AT RETAIL UNDER THE CIRCUMSTANCES
SET FORTH IN PARAGRAPH ONE OF SUBDIVISION (G) OF SECTION  THREE  HUNDRED
ONE-C OF THIS CHAPTER, AND WHERE SUCH COMMERCIAL FISHING VESSEL IS OPER-
ATED BY A COMMERCIAL FISHERMAN.
  S  2.  Subdivision  4  of  section 282-a of the tax law, as amended by
section 5 of part K of chapter 61 of the laws of  2011,  is  amended  to
read as follows:
  4.  The  tax  imposed  by  this  section on Diesel motor fuel shall be
passed through by the seller and included as part of the  selling  price
to each purchaser of such fuel. Provided, however, the amount of the tax
imposed by this section may be excluded from the selling price of Diesel
motor fuel where (i) a sale of Diesel motor fuel is made to an organiza-
tion  described  in  paragraph  (a) of subdivision three of this section
solely for the purpose stated therein; (ii) a sale of non-highway Diesel
motor fuel is made to a consumer but only  if  such  non-highway  Diesel
motor  fuel  is not delivered to a filling station, nor delivered into a
storage tank which is equipped with a hose or other apparatus  by  which
such  fuel  can  be  dispensed into the fuel tank of a motor vehicle; or
(iii) the sale to or delivery at  a  filling  station  or  other  retail
vendor  of  water-white  kerosene provided such filling station or other
retail vendor only sells such water-white kerosene exclusively for heat-
ing purposes in containers of no more than twenty  gallons;  or  (iv)  a
sale of kero-jet fuel is made to an airline for use in its airplanes; OR
(V)  A SALE OF DIESEL MOTOR FUEL IS MADE TO A "COMMERCIAL FISHERMAN", AS
SUCH TERM IS DEFINED IN SUBDIVISION (I) OF SECTION THREE HUNDRED OF THIS
CHAPTER, AT RETAIL UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH ONE OF
SUBDIVISION (G) OF SECTION THREE HUNDRED  ONE-C  OF  THIS  CHAPTER,  AND
WHERE SUCH COMMERCIAL FISHING VESSEL IS OPERATED BY A COMMERCIAL FISHER-
MAN.
  S  3. Section 301-b of the tax law is amended by adding a new subdivi-
sion (j) to read as follows:
  (J) SALES OR USES OF DIESEL MOTOR FUEL AND RESIDUAL PETROLEUM  PRODUCT
FOR  COMMERCIAL FISHING. DIESEL MOTOR FUEL OR RESIDUAL PETROLEUM PRODUCT
SOLD TO OR USED BY A "COMMERCIAL FISHERMAN", AS SUCH TERM IS DEFINED  IN
SUBDIVISION  (I)  OF  SECTION  THREE  HUNDRED OF THIS ARTICLE, AT RETAIL
UNDER THE CIRCUMSTANCES SET FORTH IN PARAGRAPH ONE OF SUBDIVISION (G) OF
SECTION THREE HUNDRED ONE-C OF THIS ARTICLE, AND WHERE  SUCH  COMMERCIAL
FISHING VESSEL IS OPERATED BY A COMMERCIAL FISHERMAN.
  S  4.  Subdivision  (j)  of section 1115 of the tax law, as amended by
section 41 of part K of chapter 61 of the laws of 2011,  is  amended  to
read as follows:
  (j) The exemptions provided in this section shall not apply to the tax
required  to  be  prepaid  pursuant  to the provisions of section eleven

S. 6879--A                          3

hundred two of this article nor to the taxes imposed by sections  eleven
hundred  five  and  eleven  hundred  ten of this article with respect to
receipts from sales and uses of motor fuel or diesel motor fuel,  except
that  the exemptions provided in paragraphs nine and forty-two of subdi-
vision (a) of this section shall apply to the tax required to be prepaid
pursuant to the provisions of section eleven hundred two of this article
and to the taxes imposed by sections  eleven  hundred  five  and  eleven
hundred  ten  of this article with respect to sales and uses of kero-jet
fuel, CNG, hydrogen and E85, provided, however,  the  exemption  allowed
for  E85  shall  be  subject  to the additional requirements provided in
section eleven hundred two of this  article  with  respect  to  E85  AND
EXCEPT  THAT THE EXEMPTION PROVIDED IN PARAGRAPH TWENTY-FOUR OF SUBDIVI-
SION (A) OF THIS SECTION SHALL APPLY TO THE TAXES  IMPOSED  BY  SECTIONS
ELEVEN  HUNDRED FIVE AND ELEVEN HUNDRED TEN OF THIS ARTICLE WITH RESPECT
TO SALES AND USES OF DIESEL MOTOR FUEL USED IN THE OPERATION OF A  FISH-
ING  VESSEL  AS DESCRIBED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION (A) OF
THIS SECTION.  The exemption provided in subdivision (c) of this section
shall apply to sales and uses of non-highway diesel motor fuel but  only
if  all  of  such  fuel is consumed other than on the public highways of
this state.  The exemption provided in subdivision (c) of  this  section
shall  apply  to sales and uses of non-highway diesel motor fuel for use
or consumption either in the production for sale  of  tangible  personal
property  by  farming or in a commercial horse boarding operation, or in
both but only if all of such fuel is consumed other than on  the  public
highways  of  this  state  (except for the use of the public highways to
reach adjacent farmlands or adjacent lands used in  a  commercial  horse
boarding operation, or both).
  S  5.  Subdivision  (j)  of section 1115 of the tax law, as amended by
section 41-a of part K of chapter 61 of the laws of 2011, is amended  to
read as follows:
  (j) The exemptions provided in this section shall not apply to the tax
required  to  be  prepaid  pursuant  to the provisions of section eleven
hundred two of this article nor to the taxes imposed by sections  eleven
hundred  five  and  eleven  hundred  ten of this article with respect to
receipts from sales and uses of motor fuel or diesel motor fuel,  except
that the exemption provided in paragraph nine of subdivision (a) of this
section  shall  apply  to the tax required to be prepaid pursuant to the
provisions of section eleven hundred two of  this  article  and  to  the
taxes  imposed by sections eleven hundred five and eleven hundred ten of
this article with respect to sales and uses of kero-jet fuel AND  EXCEPT
THAT  THE EXEMPTION PROVIDED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION (A)
OF THIS SECTION SHALL APPLY TO THE  TAXES  IMPOSED  BY  SECTIONS  ELEVEN
HUNDRED  FIVE  AND  ELEVEN  HUNDRED  TEN OF THIS ARTICLE WITH RESPECT TO
SALES AND USES OF DIESEL MOTOR FUEL USED IN THE OPERATION OF  A  FISHING
VESSEL  AS DESCRIBED IN PARAGRAPH TWENTY-FOUR OF SUBDIVISION (A) OF THIS
SECTION.   The exemption provided in subdivision  (c)  of  this  section
shall  apply to sales and uses of non-highway diesel motor fuel but only
if all of such fuel is consumed other than on  the  public  highways  of
this  state.  The  exemption provided in subdivision (c) of this section
shall apply to sales and uses of non-highway diesel motor fuel  for  use
or  consumption  either  in the production for sale of tangible personal
property by farming or in a commercial horse boarding operation,  or  in
both  but  only if all of such fuel is consumed other than on the public
highways of this state (except for the use of  the  public  highways  to
reach  adjacent  farmlands  or adjacent lands used in a commercial horse
boarding operation, or both).

S. 6879--A                          4

  S 6.  This act shall take effect on the first day of a sales tax quar-
terly period, as described in subdivision (b) of section 1136 of the tax
law, next commencing at least ninety days  after  this  act  shall  have
become  a  law;  sections four and five of this act shall apply to sales
made  under  and uses occurring on or after the dates such sections four
and five shall have taken effect, respectively, although made or  occur-
ring  under  a prior contract; and provided further that such amendments
made by section four of this act shall be subject to the expiration  and
reversion  of  such  subdivision  pursuant  to section 19 of part W-1 of
chapter 109 of the laws of 2006, as amended, when  upon  such  date  the
provisions of section five of this act shall take effect.

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