§ 1110. Imposition of compensating use tax. (a) Except to the extent
that property or services have already been or will be subject to the
sales tax under this article, there is hereby imposed on every person a
use tax for the use within this state on and after June first, nineteen
hundred seventy-one except as otherwise exempted under this article, (A)
of any tangible personal property purchased at retail, (B) of any
tangible personal property (other than computer software used by the
author or other creator) manufactured, processed or assembled by the
user, (i) if items of the same kind of tangible personal property are
offered for sale by him in the regular course of business or (ii) if
items are used as such or incorporated into a structure, building or
real property by a contractor, subcontractor or repairman in erecting
structures or buildings, or building on, or otherwise adding to,
altering, improving, maintaining, servicing or repairing real property,
property or land, as the terms real property, property or land are
defined in the real property tax law, if items of the same kind are not
offered for sale as such by such contractor, subcontractor or repairman
or other user in the regular course of business, (C) of any of the
services described in paragraphs (1), (7) and (8) of subdivision (c) of
section eleven hundred five of this part, (D) of any tangible personal
property, however acquired, where not acquired for purposes of resale,
upon which any of the services described in paragraphs (2), (3) and (7)
of subdivision (c) of section eleven hundred five of this part have been
performed, (E) of any telephone answering service described in
subdivision (b) of section eleven hundred five of this part, (F) of any
computer software written or otherwise created by the user if the user
offers software of a similar kind for sale as such or as a component
part of other property in the regular course of business, (G) of any
prepaid telephone calling service, and (H) of any gas or electricity
described in subdivision (b) of section eleven hundred five of this
part.

(b) For purposes of clause (A) of subdivision (a) of this section, the
tax shall be at the rate of four percent of the consideration given or
contracted to be given for such property, or for the use of such
property, including any charges for shipping or delivery as described in
paragraph three of subdivision (b) of section eleven hundred one, but
excluding any credit for tangible personal property accepted in part
payment and intended for resale.

(c) For purposes of subclause (i) of clause (B) of subdivision (a) of
this section, the tax shall be at the rate of four percent of the price
at which items of the same kind of tangible personal property are
offered for sale by the user, and the mere storage, keeping, retention
or withdrawal from storage of tangible personal property by the person
who manufactured, processed or assembled such property shall not be
deemed a taxable use by him; provided, however, that if the user uses
such an item itself on its own premises (not including making a gift of
such tangible personal property), solely in the conduct of the user's
own business operations, and the item retains its characteristic as
tangible personal property when so used, the tax shall be at the rate,
and on the consideration, described in subdivision (d) of this section.

(d) For purposes of subclause (ii) of clause (B) of subdivision (a) of
this section, the tax shall be at the rate of four percent of the
consideration given or contracted to be given for the tangible personal
property manufactured, processed or assembled into the tangible personal
property the use of which is subject to tax, including any charges for
shipping or delivery as described in paragraph three of subdivision (b)
of section eleven hundred one.

(e) Notwithstanding the foregoing, provisions of this section, for
purposes of clause (B) of subdivision (a) of this section, there shall
be no tax on any portion of such price which represents the value added
by the user to tangible personal property which he fabricates and
installs to the specifications of an addition or capital improvement to
real property, property or land, as the terms real property, property or
land are defined in the real property tax law, over and above the
prevailing normal purchase price prior to such fabrication of such
tangible personal property which a manufacturer, producer or assembler
would charge an unrelated contractor who similarly fabricated and
installed such tangible personal property to the specifications of an
addition or capital improvement to such real property, property or land.

(f) For purposes of clauses (C), (D), and (E) of subdivision (a) of
this section, the tax shall be at the rate of four percent of the
consideration given or contracted to be given for the service, including
the consideration for any tangible personal property transferred in
conjunction with the performance of the service and also including any
charges for shipping and delivery of the property so transferred and of
the tangible personal property upon which the service was performed as
such charges are described in paragraph three of subdivision (b) of
section eleven hundred one.

(g) For purposes of clause (F) of subdivision (a) of this section, the
tax shall be at the rate of four percent of the consideration given or
contracted to be given for the tangible personal property which
constitutes the blank medium, such as disks or tapes, used in
conjunction with the software, or for the use of such property, and the
mere storage, keeping, retention or withdrawal from storage of computer
software described in such clause (F) by its author or other creator
shall not be deemed a taxable use by such person.

(h) For purposes of clause (G) of subdivision (a) of this section, the
tax shall be at the rate of four percent of the consideration given or
contracted to be given for the service, including the consideration for
any tangible personal property transferred in conjunction with the
service and also including any charges for shipping and delivery of the
property so transferred as such charges are described in paragraph three
of subdivision (b) of section eleven hundred one; provided that, if the
user offers like services for sale in the regular course of business,
the tax shall be at the rate of four percent of the price at which the
user offers such like services for sale.

(i) For purposes of clause (H) of subdivision (a) of this section, the
tax shall be at the rate of four percent of the consideration given or
contracted to be given for, or for the use of, the gas or electricity,
including the consideration for any tangible personal property
transferred in conjunction with the performance thereof, and including
any charges described in paragraph three of subdivision (b) of section
eleven hundred one of this article.