NY State Senate Bill 2023-S6892

Current Bill Status - In Senate Committee Budget And Revenue 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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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2024	referred to budget and revenue
May 12, 2023	referred to budget and revenue

2023-S6892 (ACTIVE) - Details

See Assembly Version of this Bill:: A7541
Current Committee:: Senate Budget And Revenue
Law Section:: Tax Law
Laws Affected:: Amd §§1105 & 1135, Tax L

2023-S6892 (ACTIVE) - Summary

Enacts the "microbusiness resiliency and growth act"; defines "microbusiness" as a business employing five or fewer persons, is resident in this state, is independently owned and operated, is not dominant in its field, and does not conduct its business transactions primarily over the internet; further provides for a segregated sales tax system for such microbusinesses.

2023-S6892 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S6892

SPONSOR: CHU
 
TITLE OF BILL:

An act to amend the tax law, in relation to enacting the "microbusiness
resiliency and growth act"

 
PURPOSE:

The purpose of this act is to give microbusinesses in the state a
reduced sales tax rate to offset an increase in minimum wage

 
SUMMARY OF PROVISIONS:

Section 1 provides a short title for the act.

Section 2 amends the tax law, adding a new subdivision (g) by defining
the term "microbusiness" as used in the act. Subdivision (g) provides
microbusinesses in the state, under certain conditions, shall see zero
percent sales tax in the first year post-minimum wage increase, two
percent in the second year, and will return to four percent at the end

of the second year.

Section 3 amends the tax law by adding a new subdivision requiring all
microbusiness owners to keep a record of the number of their employees,
their wage, and the amount of sales tax reduction on a quarterly basis,
set by the commissioner.

Section 4 establishes the effective date.

 
JUSTIFICATION:

While there is no question that the need for minimum wage raises have
been long needed, microbusinesses often do not have the capacity within
their profit margins to accommodate the increase in overhead.  Studies
show that the increase in minimum wage, increases growth of the local
economy as consumers are able to spend more in their local communities.
However, the impact of this growth is not immediate and can take devas-
tating tolls on many of our family-owned microbusinesses. In the immedi-
ate, business owners would be forced lay off employees in order to rely
on the support of various family members to assist in the roles, which
in turns pulls those family members out of the external workforce or
from their educational opportunities in order to sustain their family
businesses.

This impacts, and often delays, social and economic mobility for the
second generation of these families. This is particularly relevant to
immigrant-run family businesses and small family farms that make up our
State's economic framework and agricultural industry, many of which run
on very slim profit margins.

By allowing these microbusinesses to take up to two years to retain an
immediate source of cash flow that would cancel out their potential
increase in overhead costs, would help to mitigate the often-crippling
economic impact of the minimum wage increase. During this time, business
owners would be able to put into place updated fiscal measures to be
able to absorb the costs of these increases and be whole by the time
these measures sunset.
 
LEGISLATIVE HISTORY:

New bill.

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect on the first day of the sales tax quarterly
period, as described in subdivision (b) of section 113 of the tax law,
next commencing at least 90 days after this act shall have become a law
and shall apply in accordance with the applicable transitional
provisions of sections 1106 and 1217 of the tax law.

2023-S6892 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   6892
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                               May 12, 2023
                                ___________
 
 Introduced  by  Sen.  CHU  --  read  twice and ordered printed, and when
   printed to be committed to the Committee on Budget and Revenue
 
 AN ACT to amend the tax law, in relation to enacting the  "microbusiness
   resiliency and growth 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 "microbusiness resiliency and growth act".
   §  2.  Section 1105 of the tax law is amended by adding a new subdivi-
 sion (g) to read as follows:
   (G) FOR THE PURPOSES OF THIS CHAPTER, "MICROBUSINESS" SHALL BE DEFINED
 AS A BUSINESS EMPLOYING FIVE OR  FEWER  PERSONS,  IS  RESIDENT  IN  THIS
 STATE,  IS  INDEPENDENTLY  OWNED  AND  OPERATED,  IS NOT DOMINANT IN ITS
 FIELD, AND DOES NOT CONDUCT ITS BUSINESS TRANSACTIONS PRIMARILY OVER THE
 INTERNET.  WHEN THE GOODS OR SERVICES ARE PURCHASED FROM A MICROBUSINESS
 WITHIN THE FIRST FIVE YEARS OF THE OPENING OF SUCH  MICROBUSINESS  OR  A
 MICROBUSINESS  WITH  A  GROSS PROFIT OF FIVE HUNDRED THOUSAND DOLLARS OR
 LESS IN THE PRIOR TAX YEAR,  TAX PAID ON SUCH SALES FOR THE  FIRST  YEAR
 SHALL  BE  ZERO  PERCENT AND IN THE SECOND YEAR, SUCH SALES TAX SHALL BE
 TWO PERCENT PROVIDED, HOWEVER THAT THE PROFIT GENERATED  ON  SUCH  FIRST
 AND SECOND YEAR SALES TAX REDUCTION IS COLLECTED UP UNTIL THE DIFFERENCE
 BETWEEN  THE  PRIOR AND CURRENT MINIMUM WAGE PURSUANT TO SUBDIVISION ONE
 OF SECTION SIX HUNDRED FIFTY-TWO OF THE LABOR LAW  IN  CONCURRENCE  WITH
 QUARTERLY  SALES  TAX PERIODS AS PRESCRIBED BY THE DEPARTMENT. AFTER THE
 END OF THE SECOND YEAR, SALES TAXES SHALL RETURN TO  FOUR  PERCENT.  TAX
 PAID ON SALES AFTER THE PROFIT DIFFERENCE BETWEEN THE PRIOR MINIMUM WAGE
 AND  CURRENT  MINIMUM  WAGE  PURSUANT  TO SUBDIVISION ONE OF SECTION SIX
 HUNDRED FIFTY-TWO OF THE LABOR LAW IS MET SHALL RETURN TO FOUR  PERCENT.
 MICROBUSINESSES THAT ELECT TO USE A SEGREGATED SALES TAX ACCOUNT FOR THE
 HANDLING  OF  TRANSACTIONS  WITH THE DEPARTMENT, OR ARE REQUIRED TO KEEP
 SUCH AN ACCOUNT PURSUANT TO SECTION ELEVEN HUNDRED THIRTY-SEVEN OF  THIS
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD11020-01-3

 S. 6892                             2
 
 ARTICLE  MUST DEDUCT THE AFOREMENTIONED PROFIT FROM THE SEGREGATED SALES
 TAX ACCOUNT WITHIN ONE WEEK OF DEPOSIT.
   §  3.  Section 1135 of the tax law is amended by adding a new subdivi-
 sion (f-1) to read as follows:
   (F-1) EVERY MICROBUSINESS OWNER SHALL KEEP RECORDS OF  THE  NUMBER  OF
 EMPLOYEES,  THEIR  WAGE,  AND THE AMOUNT OF THE SALES TAX REDUCTION ON A
 QUARTERLY BASIS AND IN THE MANNER PRESCRIBED BY THE COMMISSIONER  PURSU-
 ANT TO RULES AND REGULATIONS.
   §  4.  This  act  shall  take effect on the first day of the sales tax
 quarterly period, as described in subdivision (b) of section 1136 of the
 tax law, next commencing at least 90 days  after  this  act  shall  have
 become  a law and shall apply in accordance with the  applicable transi-
 tional provisions of sections 1106 and 1217 of the tax law.

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Senate Bill S6892

Sponsored By

Current Bill Status - In Senate Committee Budget And Revenue Committee

2023-S6892 (ACTIVE) - Details

2023-S6892 (ACTIVE) - Summary

2023-S6892 (ACTIVE) - Sponsor Memo

2023-S6892 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S6892

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Sponsored By

Iwen Chu

Current Bill Status - In Senate Committee Budget And Revenue Committee

2023-S6892 (ACTIVE) - Details

2023-S6892 (ACTIVE) - Summary

2023-S6892 (ACTIVE) - Sponsor Memo

2023-S6892 (ACTIVE) - Bill Text download pdf

Comments