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

                                  6295

                            I N  S E N A T E

                               (PREFILED)

                             January 6, 2016
                               ___________

Introduced  by  Sen. KENNEDY -- 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 the  measurement  of  liquor
  for tax purposes

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

  Section 1. Subdivision 1 of section 421 of the tax law, as amended  by
chapter 508 of the laws of 1993, is amended to read as follows:
  1.  General.  The commissioner, upon the application of a distributor,
shall register such distributor in suitable books  to  be  kept  by  the
department for that purpose, conditioned upon the obtaining of appropri-
ate  licenses  pursuant  to  the alcoholic beverage control law, and the
continuance of such license shall be a continuing condition of registra-
tion as a distributor under this article. The application shall be in  a
form  and  contain  such  data  as  the commissioner shall prescribe. No
distributor, unless so registered, shall  make  any  sale  of  alcoholic
beverages  within  this  state,  except a sale, if any, as to which this
state is without power to impose such condition. No  person,  unless  so
registered, shall (i) import or cause any liquors to be imported in this
state  for  sale  or  use  within  this state, (ii) purchase a warehouse
receipt and pursuant to such purchase then cause liquors covered by such
receipt to be removed from a warehouse in this state or (iii) except  in
accordance  with clause (i) or (ii) of paragraph (b) of subdivision four
of section four hundred twenty of this article, produce, distill,  manu-
facture, compound, mix or ferment any such liquors within this state for
sale.  Provided,  however, that the commissioner may exclude from regis-
tration requirements any person who is a distributor of  liquors  solely
by  reason  of  the  importation into this state of no more than [ninety
liters] TWENTY-FOUR GALLONS of liquors during a one-year period for such
person's personal use and consumption to register as a distributor  with
respect  to  liquor. Provided, further, that an abbreviated registration
in the from of a permit, without  a  bond,  may  be  instituted  by  the

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                      [ ] is old law to be omitted.
                                                           LBD13203-01-5

S. 6295                             2

commissioner  for  the  purpose  of authorizing the importation of up to
[three hundred sixty liters NINETY-FIVE GALLONS of liquors per year into
this state by an individual  for  such  individual's  personal  use  and
consumption in this state.
  S 2. Paragraphs (e), (f) and the opening paragraph of paragraph (g) of
subdivision 1 of section 424 of the tax law, paragraph (e) as amended by
chapter 190 of the laws of 1990, paragraph (f) and the opening paragraph
of  paragraph  (g)  as  amended  by chapter 508 of the laws of 1993, are
amended to read as follows:
  (e) [Sixty-seven] TWO DOLLARS AND FIFTY-FOUR cents per [liter]  GALLON
upon  liquors containing not more than twenty-four per centum of alcohol
by volume except liquors containing not more  than  two  per  centum  of
alcohol by volume, upon which the tax shall be [one cent] FOUR CENTS per
[liter] GALLON; and
  (f)  [One  dollar  and  seventy]  SIX DOLLARS AND FORTY-FOUR cents per
[liter] GALLON upon all other liquors; when sold  or  used  within  this
state, except when sold or used under such circumstances that this state
is  without  power  to impose such tax or when sold to the United States
and except beers when sold to or by a voluntary unincorporated organiza-
tion of the armed forces of the United States operating a place for  the
sale  of  goods  pursuant  to regulations promulgated by the appropriate
executive agency of the United States, to the extent  provided  in  such
regulations, directives and policy statements of such an agency applica-
ble  to  such  sales,  and  except  when  sold  to  professional foreign
consuls-general, consuls and vice-consuls who are nationals of the state
appointing them and who are  assigned  to  foreign  consulates  in  this
state,  provided  that  American consular officers of equal rank who are
citizens of the United States and who exercise their official  functions
at  American  consulates  in such foreign country are granted reciprocal
exemptions; provided, however, that the commissioner may permit the sale
of alcohol without tax to a holder of  any  industrial  alcohol  permit,
alcohol  permit  or  alcohol  distributor's  permit, issued by the state
liquor authority, and by the holder of an alcohol distributor's  permit,
class  A, issued by such authority to a holder of a distiller's license,
class B, or a winery license, issued by  such  authority  and  may  also
permit  the  use of alcohol for any purpose other than the production of
alcoholic beverages by such holders without tax; provided also that  the
commissioner  may  permit the sale of cider without tax by a holder of a
cider producer's license issued by the state liquor authority to a hold-
er of a cider producer's license or a cider wholesaler's license  issued
by such authority.
  For  purposes  of  this  chapter,  it  is  presumed  that  liquors are
possessed for the purpose of sale in  this  state  if  the  quantity  of
liquors  possessed in this state, imported or caused to be imported into
this state or produced, distilled, manufactured,  compounded,  mixed  or
fermented  in  this  state  exceeds [ninety liters] TWENTY-FOUR GALLONS.
Such presumption may be rebutted  by  the  introduction  of  substantial
evidence  to  the  contrary. In any case where the quantity of alcoholic
beverages taxable pursuant to this article is a fractional part  of  one
[liter (or one] gallon [in the case of beers)] or an amount greater than
a  whole  multiple  of [liters (or] gallons [in the case of beers)], the
amount of tax levied and imposed on such fractional part of  one  [liter
(or  one] gallon [in the case of beers)], or fractional part of a [liter
(or] gallon[)] in excess of a whole  multiple  of  [liters  or]  gallons
shall  be  such  fractional  part  of the rate imposed by paragraphs (a)
through (f).

S. 6295                             3

  S 3. Section 425-a of the tax law, as added by chapter 508 of the laws
of 1993, is amended to read as follows:
  S  425-a.  Presumption  of  taxability.  For the purpose of the proper
administration of the taxes imposed  by  this  article  and  to  prevent
evasion  thereof, it shall be presumed with respect to this chapter that
all alcoholic beverages possessed or found in this state are subject  to
the  taxes  imposed by this article until the contrary is established by
substantial evidence. Except with respect to a  purchase  at  retail  of
beers  or  wines and a purchase at retail of [ninety liters] TWENTY-FOUR
GALLONS or less of liquors, no person shall purchase alcoholic beverages
in this state unless the taxes imposed by this article with  respect  to
such  beverages have been assumed by a distributor registered under this
article or paid by such distributor pursuant to and in  accordance  with
the  manner  provided herein and evidenced in accordance with the manner
provided herein. In the case of liquors, such taxes shall be assumed  by
a  distributor  in accordance with the invoice required, and the certif-
ication of tax payment included  therein,  under  section  four  hundred
twenty-seven  of this article; in the case of other alcoholic beverages,
the taxes shall be assumed  by  such  distributor  pursuant  to  and  in
accordance with the rules or regulations of the department.
  S 4. Section 426 of the tax law, as amended by chapter 891 of the laws
of 1986, is amended to read as follows:
  S  426.  Records  to be kept by brand owners, distributors, owners and
others.  Every brand owner, distributor, owner  or  other  person  shall
keep  a complete and accurate record of all purchases and sales or other
dispositions of alcoholic beverages, and a complete and accurate  record
of  the  number  of  gallons  of beers produced, manufactured, brewed or
fermented  and  [liters]  GALLONS  of  all  other  alcoholic   beverages
produced, distilled, manufactured, brewed, compounded, mixed or ferment-
ed.  Such  records shall be in such form and contain such other informa-
tion as the tax commission shall prescribe. Said commission, by rule  or
regulation, also may require the delivery of statements to purchasers of
alcoholic  beverages, and prescribe the matters to be contained therein.
Such records and statements, unless required by the tax commission to be
preserved for a longer period, shall be preserved for a  period  of  one
year  and shall be offered for inspection at any time upon oral or writ-
ten demand by the commissioner [of taxation and  finance]  or  his  duly
authorized  agents,  and  every  such distributor, brand owner, owner or
other person shall make such reports to the department [of taxation  and
finance]  as  may  be  required  by  the tax commission. Nothing in this
section contained shall be construed to require the keeping of a  record
of  the  purchase  or  disposition  of alcoholic beverages by a consumer
thereof, except by a person who uses the same for  commercial  purposes,
or of the sale of alcoholic beverages at retail.
  S  5.  Subdivision 1 and paragraph (i) of subdivision 2 of section 427
of the tax law, as added by chapter 508 of the laws of 1993, are amended
to read as follows:
  1.  Every sale of liquors, except a sale at retail of [ninety  liters]
TWENTY-FOUR  GALLONS  or  less, shall be evidenced by and recorded on an
individual, serially numbered invoice, and, with respect  to  each  such
sale,  the  seller  therein  shall  make and complete such invoice which
shall contain the information required by this section and give the same
to the purchaser at the time of delivery. The seller shall sign and date
the invoice required by this section and certify the entire  content  of
such invoice.

S. 6295                             4

  (i)  the  size  (in [liters] GALLONS) and number of bottles of liquors
sold, and its description, by brand name and price; and
  S  6. Subdivision 2 of section 428 of the tax law, as added by chapter
508 of the laws of 1993, is amended to read as follows:
  2. The operator of a motor vehicle, as such term is defined in  subdi-
vision  three  of section two hundred eighty-two of this chapter, or any
other means of transport of liquors in which more than  [ninety  liters]
TWENTY-FOUR  GALLONS  of liquors is being transported in this state must
have in his or her possession a  manifest,  invoice  or  other  document
which  shows  the  name and address of the person from whom such liquors
were received and the date and place of receipt of such liquor  and  the
name and address of every person to whom such operator is to make deliv-
ery  of  the same and the place of delivery, together with the number of
liters to be delivered to each person, and,  if  such  liquor  is  being
imported  into  the  state  in such motor vehicle or such other means of
transport, the name of the distributor importing or causing such liquors
to be imported into the state and such other information as the  commis-
sioner  may  require  pursuant  to rule or regulation. Every operator of
such motor vehicle or such other means of transport shall at the request
of a peace officer, acting pursuant to  his  special  duties,  a  police
officer,  any  representative  of  the  department  or  any other person
authorized by law to inquire into or investigate the  transportation  of
such  liquors,  produce  such  manifest,  invoice  or other document for
inspection. The person causing the operation of such  motor  vehicle  or
such other means of transport shall be responsible to cause the operator
to  keep  in  such  operator's  possession in such motor vehicle or such
other means  of  transport  the  manifest,  invoice  or  other  document
required  by this section. The absence of the manifest, invoice or other
document required by this section shall give rise to a presumption  that
the  liquors  being  transported  are  being  imported  or  caused to be
imported into this state for sale or use therein by other than a  regis-
tered  distributor.   Moreover, the absence of (1) the place of delivery
of liquors on the manifest, invoice or other document  with  respect  to
liquors  being  imported into the state shall give rise to a presumption
that such liquors are being imported into the state for sale or  use  in
the  state and (2) the name of a registered distributor on the manifest,
invoice or other document with respect to liquors  being  imported  into
the  state  shall give rise to a presumption that such liquors are being
so imported or caused to be imported into this state, for  sale  or  use
therein,  by  other than a registered distributor. Such presumptions may
be rebutted by the introduction of substantial evidence to the contrary.
  S 7. Subdivisions 1 and 2 of section 429 of the tax law, as amended by
chapter 433 of the laws of 1978, are amended to read as follows:
  1. Every distributor, noncommercial importer or other person shall, on
or before the twentieth day of each month, file with the department  [of
taxation  and  finance]  a  return, on forms to be prescribed by the tax
commission and furnished by  such  department,  stating  separately  the
number  of  gallons,  or  lesser  quantity, of beers, [and the number of
liters, or lesser quantity, of] wines and liquors sold or used  by  such
distributor, noncommercial importer or other person in this state during
the  preceding calendar month, except that the tax commission may, if it
deems it necessary in order to insure the payment of the tax imposed  by
this article, require returns to be made at such times and covering such
periods as it may deem necessary. Such return shall contain such further
information  as the tax commission shall require. The fact that the name
of the distributor, noncommercial importer or other person is signed  to

S. 6295                             5

a  filed  return shall be prima facie evidence for all purposes that the
return was actually signed by such distributor,  noncommercial  importer
or other person.
  2. Each such distributor, noncommercial importer or other person shall
pay  to  such department with the filing of such return, the tax imposed
by this article, on each gallon, or lesser quantity, of  [beers  and  on
each  liter,  or  lesser  quantity of all other] ALL alcoholic beverages
sold or used by such distributor, noncommercial importer or other person
in this state, as so reported, during the period covered by such return,
except that, where a distributor has purchased alcoholic beverages prior
to the expiration of the period covered by the return,  upon  which  the
taxes  imposed  by  this article have been or are required to be paid by
another distributor, a credit shall be allowed for the  amount  of  such
taxes.
  S  8.  Paragraph (b) of subdivision 1 and subdivision 2 of section 445
of the tax law, as amended by chapter 433  of  the  laws  of  1978,  are
amended to read as follows:
  (b) [Twenty-six and four-tenths] NINETY-NINE AND NINE-TENTHS cents per
[liter]  GALLON on the liquors described in paragraph (f) of subdivision
one of section four hundred twenty-four, when sold or used in such city.
  2. Every local law imposing taxes pursuant to the authority of  subdi-
vision  one shall also impose upon each person, other than a distributor
within the meaning of such local law, who, on the date the taxes imposed
pursuant to the authority of such subdivision become effective, owns and
possesses for the purposes of sale beer, or  other  alcoholic  beverages
described  in subdivision one, a floor tax at the rates applicable under
subdivision one upon such beer OR OTHER ALCOHOLIC BEVERAGES in excess of
one hundred gallons [and upon such other alcoholic beverages  in  excess
of  four hundred liters]. Such floor tax shall be due and payable on the
twentieth day of the month succeeding  the  month  in  which  the  taxes
become effective.
  S  9. Subdivisions (e), (f) and (g) of section 1813 of the tax law, as
amended by section 27 of subpart I of part V-1 of chapter 57 of the laws
of 2009, are amended to read as follows:
  (e) Person not registered as a distributor. (1) Any person required to
be registered as a distributor pursuant to  the  provisions  of  article
eighteen of this chapter who, while not so registered, knowingly imports
or  causes  to  be imported into the state, for sale or use therein, any
liquors or, who, except in accordance with clause (i) or (ii)  of  para-
graph  (b)  of  subdivision  four of section four hundred twenty of this
chapter, knowingly produces, distills, manufactures, compounds, mixes or
ferments in this state any such liquors for sale, or who, as a purchaser
of a warehouse receipt, knowingly causes liquors covered by such receipt
to be removed from a warehouse in this state, shall be guilty of a class
A misdemeanor. Provided, however, that any person  who  has  twice  been
convicted  under  this section within the preceding five years, shall be
guilty of a class E felony for any subsequent violation  of  this  para-
graph.
  (2)  Any person who, while not registered as a distributor pursuant to
the provisions of article eighteen of this chapter, knowingly and inten-
tionally imports or causes to be imported into this state, for  sale  or
use  therein, more than [three hundred sixty liters] NINETY-FIVE GALLONS
of liquors into this state in a one-year period or, except in accordance
with clause (i) or (ii) of paragraph (b) of subdivision four of  section
four hundred twenty of this chapter, knowingly and intentionally produc-
es,  distills,  manufactures, compounds, mixes or ferments for sale more

S. 6295                             6

than [three hundred sixty liters] NINETY-FIVE GALLONS  of  such  liquors
within  this  state  in a one-year period, or, as a purchaser of a ware-
house receipt, knowingly  and  intentionally  causes  more  than  [three
hundred sixty liters] NINETY-FIVE GALLONS of liquors in a one-year peri-
od  to  be  removed from a warehouse in this state, shall be guilty of a
class E felony.
  (3) For purposes of this subdivision, it shall be  presumed  that  the
importation  or  the  causing  to  be  imported  into  this state or the
production, distillation, manufacture, compounding, mixing or fermenting
in this state of more than [ninety liters] TWENTY-FOUR GALLONS  of  such
liquors by any person in a one-year period is for purposes of sale. Such
presumption  may be rebutted by the introduction of substantial evidence
to the contrary.
  (f) Person not registered as a distributor for city purposes. (1)  Any
person  required  to  be  registered  as a distributor for city purposes
pursuant to the provisions of section four hundred forty-five of article
eighteen of this chapter who, while not so registered, knowingly imports
or causes to be imported into such city, for sale or  use  therein,  any
liquors  or,  who, except in accordance with clause (i) or (ii) of para-
graph (b) of subdivision four of section four  hundred  twenty  of  this
chapter as incorporated into such section four hundred forty-five, know-
ingly  produces, distills, manufactures, compounds, mixes or ferments in
such city any such liquors for sale, or who, as a purchaser of  a  ware-
house receipt, causes liquors covered by such receipt to be removed from
a  warehouse  in  this  state, shall be guilty of a class A misdemeanor.
Provided, however, that any person who has twice  been  convicted  under
this  section within the preceding five years shall be guilty of a class
E felony for any subsequent violation of this paragraph.
  (2) Any person who, while not registered as  a  distributor  for  city
purposes  pursuant  to the provisions of section four hundred forty-five
of article eighteen of this chapter, knowingly and intentionally imports
or causes to be imported into such city, for sale or use  therein,  more
than  [three  hundred  sixty liters] NINETY-FIVE GALLONS of liquors into
such city in a one-year period or, except in accordance with clause  (i)
or  (ii)  of  paragraph  (b) of subdivision four of section four hundred
twenty of this chapter as incorporated into such  section  four  hundred
forty-five,  knowingly  and  intentionally  produces, distills, manufac-
tures, compounds, mixes or ferments for sale more  than  [three  hundred
sixty  liters] NINETY-FIVE GALLONS of such liquors within such city in a
one-year period, or, as a purchaser of a  warehouse  receipt,  knowingly
and  intentionally causes more than [three hundred sixty liters] NINETY-
FIVE GALLONS of liquors in a one-year period to be removed from a  ware-
house in this state, shall be guilty of a class E felony.
  (3)  For  purposes  of this subdivision, it shall be presumed that the
importation or the  causing  to  be  imported  into  such  city  or  the
production, distillation, manufacture, compounding, mixing or fermenting
in such city of more than [ninety liters] TWENTY-FOUR GALLONS of liquors
by  any  person  in  a  one-year  period  is  for purposes of sale. Such
presumption may be rebutted by the introduction of substantial  evidence
to the contrary.
  (g)  Any  person,  other than the distributor registered under article
eighteen of this chapter which imported or  caused  the  liquors  to  be
imported  into this state, who shall willfully and knowingly have in his
custody, possession or under his control liquors with respect  to  which
the taxes imposed by or pursuant to the authority of article eighteen of
this  chapter  have not been assumed or paid by a distributor registered

S. 6295                             7

as such under such article, shall be guilty of a class B misdemeanor; if
such person shall willfully and knowingly have more than [ninety liters]
TWENTY-FOUR GALLONS of such liquors in  his  custody  or  possession  or
under his control, such person shall be guilty of a class A misdemeanor;
or  if  such  person  shall  knowingly  and intentionally have more than
[three hundred sixty liters] NINETY-FIVE GALLONS of such liquors in  his
custody  or possession or under his control, such person shall be guilty
of a class E felony. For purposes of this subdivision, such person shall
willfully and knowingly have in his custody,  possession  or  under  his
control  any  liquors  with  respect  to  which such taxes have not been
assumed or paid by a distributor registered as such  where  such  person
has  knowledge  of the requirement of such taxes and where, to his know-
ledge, such taxes have not been assumed or paid by a registered distrib-
utor with respect to such liquors.
  S 10. Subdivisions (a), (k) and (l) of section 1845 of the tax law, as
added by chapter 508 of the  laws  of  1993,  are  amended  to  read  as
follows:
  (a) Temporary seizure. Whenever a police officer designated in section
1.20  of  the  criminal  procedure  law or a peace officer designated in
subdivision four of section 2.10 of such law,  acting  pursuant  to  his
special  duties,  shall  discover  more than [ninety liters] TWENTY-FOUR
GALLONS of liquors which are being imported  for  sale  or  use  in  the
state, where the person importing or causing such liquors to be imported
is not registered as a distributor under section four hundred twenty-one
of  this chapter, such police officer or peace officer is hereby author-
ized to seize and take possession of such liquors, and to seize and take
possession of the vehicle or  other  means  of  transportation  used  to
transport such liquors.
  (k) An additional ground for seizure and forfeiture under this section
shall  be where such police officer or peace officer shall discover more
than [ninety liters] TWENTY-FOUR GALLONS of liquors in this state,  with
respect to which the taxes imposed by or pursuant to article eighteen of
this  chapter  have not been paid or assumed by a person registered as a
distributor pursuant to  such  article,  which  are  in  the  course  of
distribution  in  this  state or which are being sold in this state. All
the foregoing subdivisions of this section shall apply  to  the  seizure
and  forfeiture of liquors referred to in this subdivision and the vehi-
cle transporting the same as if such foregoing subdivisions specifically
referred to such grounds and as if such grounds set forth in this subdi-
vision were set forth as grounds for seizure in subdivision (a)  hereof.
Provided  that  in  the forfeiture action with respect to the liquors or
vehicle referred  to  in  this  subdivision,  the  department  shall  be
required  to show that such liquors were found within the state and that
they were in the course of distribution in this state or were being sold
in this state.
  (l) This section shall also apply to a forfeiture action with  respect
to  the  importation of more than [ninety liters] TWENTY-FOUR GALLONS of
liquors into a city imposing a tax pursuant to the authority of  section
four  hundred forty-five of this chapter by a person not registered as a
distributor for purposes of such tax or, in addition,  with  respect  to
the distribution or sale of untaxed liquors in such city.
  S  11.  This  act  shall  take effect on the one hundred eightieth day
after it shall have become a law.