§ 1223. Limitations on rates. (a) No transaction taxable under
sections twelve hundred two through twelve hundred four of this article
shall be taxed pursuant to this article by any county or by any city
located therein, or by both, at an aggregate rate in excess of the
highest rate set forth in the applicable subdivision of section twelve
hundred one of this article or, in the case of any taxes imposed
pursuant to the authority of section twelve hundred ten or twelve
hundred eleven of this article (other than taxes imposed by the county
of Nassau, Erie, Steuben, Cattaraugus, Suffolk, Oneida, Genesee, Greene,
Franklin, Hamilton, Herkimer, Tioga, Orleans, Allegany, Ulster, Albany,
Rensselaer, Tompkins, Wyoming, Columbia, Schuyler, Rockland, Chenango,
Monroe, Chemung, Seneca, Sullivan, Wayne, Livingston, Schenectady,
Montgomery, Delaware, Clinton, Niagara, Yates, Lewis, Essex, Dutchess,
Schoharie, Putnam, Chautauqua, Orange, Oswego, Ontario, Jefferson, St.
Lawrence, Westchester or Onondaga and by the county of Cortland and the
city of Cortland and by the county of Broome and the city of Binghamton
and by the county of Cayuga and the city of Auburn and by the county of
Otsego and the city of Oneonta and by the county of Madison and the city
of Oneida and by the county of Fulton and the city of Gloversville or
the city of Johnstown as provided in section twelve hundred ten of this
article) at a rate in excess of three percent, except that, in the city
of Yonkers, in the city of Mount Vernon, in the city of New Rochelle, in
the city of Fulton, in the city of Oswego, and in the city of White
Plains, the rate may not be in excess of four percent, and except that
in the city of Poughkeepsie in the county of Dutchess, if such county
withdraws from the metropolitan commuter transportation district
pursuant to section twelve hundred seventy-nine-b of the public
authorities law and if the revenues from a three-eighths percent rate of
such tax imposed by such county, pursuant to the authority of section
twelve hundred ten of this article, are required by local laws,
ordinances or resolutions to be set aside for mass transportation
purposes, the rate may not be in excess of three and three-eighths
percent.

(b) If a transaction is taxed by both a county and a city, the rate of
tax on such transaction imposed by the county or city, not having prior
right thereto pursuant to section twelve hundred twenty-four, shall be
deemed to be reduced (or the entire tax eliminated, if necessary) to the
extent necessary to comply with the foregoing requirement. A tax imposed
by a county upon any transaction, to the extent that it would require a
reduction in any tax rate imposed thereon by a city, shall not become
effective in respect to any transaction taxed by such city (or in
respect of other similar transactions outside of the city which, if
occurring in such city, would be subject to such city tax) before the
commencement of the city's next succeeding fiscal year and then only if
the county shall have given notice to such city of its imposition of a
tax on such transaction at least six months prior to the commencement of
such fiscal year, provided however that the local legislative body of
such city may waive the requirement of such notice and the postponement
of the effective date of such tax. A city tax upon any transaction, to
the extent that it would require a reduction in any tax rate imposed by
a county thereon, shall not become effective in respect of any
transaction taxed by such county before the commencement of the county's
next succeeding fiscal year and then only if the city shall have given
notice to such county of its imposition of a tax on such transaction at
least six months prior to the commencement of such fiscal year,
provided, however, that the local legislative body of such county may
waive the requirement of such notice and postponement of the effective
date of such tax. However, whether or not the six months' notice
requirement provided in this section has been waived, a tax imposed
pursuant to the authority of section twelve hundred ten or twelve
hundred eleven shall still be subject to the requirements provided for
in the first three sentences of subdivision (d) of such sections and in
subdivision (e) of such sections.