2023 New York Laws › TAX - Tax › Article 28 - Sales and Compensating Use Taxes › Part 1 - Definitions › 1103 - Prepayment of Sales Tax on Cigarettes.

§  1103. Prepayment of sales tax on cigarettes. (a)(1) Every cigarette
agent shall pay, as a prepayment on account of the taxes imposed by this
article and pursuant to the authority of  article  twenty-nine  of  this
chapter, a tax on cigarettes possessed for sale or use in this state and
to  which  an  agent  is  required  to  affix cigarette tax stamps under
article twenty of this chapter, at the time that the agent  is  required
to  purchase  and  affix  such stamps (or as otherwise prescribed by the
commissioner pursuant to such article twenty) and the provisions of such
article twenty in relation to the use of stamps to evidence  payment  of
the  tax  imposed  by  such  article  twenty  shall be applicable to the
prepayment imposed by this section, except no tax shall be  required  to
be  prepaid  on  cigarettes  sold under circumstances that this state is
without power to impose such prepayment or sold to the United States  or
sold  to  or  by  a  voluntary  unincorporated organization 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  and
written policy statements of such an agency applicable to such sales.
(2) The tax imposed by this section shall be paid at the same time and
in  the  same  manner  as  the  tax  imposed by such article twenty with
respect to cigarettes.  The  commissioner  may,  in  the  commissioner's
discretion, permit an agent to pay the tax imposed under this section at
the same time that the agent pays for cigarette tax stamps under article
twenty  of  this chapter and may require any such agent to file with the
department  a  bond  issued  by  a  surety  company  approved   by   the
superintendent  of  financial services as to solvency and responsibility
and authorized to transact business  in  the  state  or  other  security
acceptable  to  the commissioner, in such amount as the commissioner may
fix, to secure the payment of any sums due from such agent  pursuant  to
this  section.  If  securities  are  deposited  as  security  under this
subdivision, such securities  shall  be  kept  in  the  custody  of  the
commissioner and may be sold by the commissioner if it becomes necessary
to  do  so  in order to recover any sums due from such agent pursuant to
this section, but no such sale shall be had until after such agent shall
have had an opportunity to litigate the validity of  any  prepayment  of
tax  if  it  elects  to  do so. Upon any such sale, the surplus, if any,
above the sums due under this section shall be returned to  such  agent.
Any  bond  or  security  required  under  this  section  may  be jointly
administered with the bond or  security  required  of  the  agent  under
section four hundred seventy-two of this chapter and in such event shall
secure  payment of the sums due under such article twenty and under this
section. The tax imposed by this section and the portion of the cost  of
any stamp which evidences payment of the tax imposed by this section and
which  is  attributable  to the tax imposed by this section shall not be
included in the term "basic cost of cigarettes" as such term is  defined
in section four hundred eighty-three of this chapter.
(3)  Every  person other than an agent shall prepay the tax imposed by
this section at the same time and in the same  manner  as  the  use  tax
imposed  by  section  four  hundred  seventy-one-a  of this chapter. The
commissioner may require any compensating use  tax  imposed  by  section
eleven  hundred ten and pursuant to the authority of article twenty-nine
of this chapter to be paid at such time after allowing  for  the  credit
provided by subdivision (b) of section eleven hundred twenty-one of this
article.
(4)  The  amount  of  the  prepayment  for  cigarettes imposed by this
section shall be computed pursuant to the provisions of subdivision  (j)
of section eleven hundred eleven of this article.
(b)  Except  as otherwise provided in this section, the taxes required
to be prepaid  pursuant  to  this  section  shall  be  administered  and
collected  in  a  like  manner  as  the taxes imposed by sections eleven
hundred five and eleven hundred ten of this article. All the  provisions
of  this  article  relating  to  or  applicable  to  the administration,
collection and disposition of the taxes imposed by such  sections  shall
apply  to  the  tax  required to be prepaid under this section so far as
such provisions can be made applicable to such prepayments of  tax  with
such  limitations as set forth in this article and such modifications as
may be necessary in order to adapt such language to the tax so  imposed;
provided,  however,  that the provisions of paragraph one of subdivision
(c) of section eleven hundred thirty-seven of this article shall not  be
applicable  to  such tax required to be prepaid under this section. Such
provisions shall apply with the same force and effect as if the language
of those provisions had been set forth in full in this section except to
the extent that any provision is either inconsistent with a provision of
this section or is not relevant to the tax required  to  be  prepaid  by
this  section.  For  purposes  of  this  section,  any reference in this
article to the tax or taxes imposed by this article shall be  deemed  to
refer  to the tax required to be prepaid pursuant to this section unless
a different meaning is clearly required.
(c) Nothing in this article shall be construed to require the  payment
of  the  tax  required  to be prepaid pursuant to this section more than
once upon cigarettes possessed for sale or used within the  state.  When
the  prepaid tax imposed pursuant to this section is paid, it shall have
been so paid on account  of  the  taxes  imposed  by  this  article  and
pursuant  to  the  authority of article twenty-nine of this chapter with
respect to the retail sale or the use of  cigarettes.  Nothing  in  this
section  shall  modify  or  affect  the taxes imposed by sections eleven
hundred five and eleven hundred  ten  of  this  article  as  applied  to
receipts from the sale, or to the use, of such cigarettes.
(d)  Deposit  and disposition of revenue. (1) Consistent with sections
eleven hundred forty-eight of this article and twelve hundred  sixty-one
of  this  chapter,  the  taxes  required  to be prepaid pursuant to this
section and interest and penalties thereon received by the commissioner,
after deducting the amount which the commissioner shall determine to  be
necessary  for  reasonable  costs  of the commissioner in administering,
collecting, and distributing such taxes, shall be deposited  daily  with
such  responsible  banks,  banking  houses or trust companies, as may be
designated by the comptroller, to the credit of the comptroller. Of  the
total  revenue collected or received under this section, the comptroller
shall retain in the comptroller's hands such amount as the  commissioner
may  determine  to  be  necessary  for  refunds  under  this article and
pursuant to the authority of article twenty-nine of this chapter.
(2) On or before the twelfth day of each month, after  reserving  such
amount for such refunds and such costs, the commissioner shall determine
the  amount  of  all  revenues  so  received during the prior month as a
result of the taxes, interest and penalties so imposed and, in addition,
on or before the last day of June and December  the  commissioner  shall
determine  in  like manner the amount of such moneys received during and
including the first twenty-five days of said  months.  The  commissioner
shall  determine the proportion of revenues attributable to receipts for
the period for which the determination is made pursuant to the preceding
sentence from taxes on sales and uses of property and services and  rent
and  amusement  charges  imposed  by  this  article  and pursuant to the
authority of article twenty-nine of this chapter and administered by the
commissioner which is payable to each  jurisdiction  determined  without
regard to this section. The amount of revenues so determined pursuant to

this  section  shall  be deposited and distributed by the comptroller in
accordance with the same percentage amount to which  a  jurisdiction  is
entitled  determined without regard to this section. Where the amount so
determined  in  any  distribution  from  such  taxes (other than the tax
imposed by this section) is more or less than the amount due, the amount
of the overpayment or underpayment shall be determined as soon after the
discovery of the overpayment or underpayment as is  reasonably  possible
and  subsequent  determinations  shall  be  adjusted  by subtracting the
amount of any such overpayment from or by adding the amount of any  such
underpayment  to  such  number of subsequent payments as the comptroller
and the commissioner shall consider reasonable in view of the amount  of
the  overpayment  or  underpayment  and  all  other  pertinent facts and
circumstances. The commissioner shall not be liable for any overestimate
or underestimate of the  amount  of  the  distribution.  Nor  shall  the
commissioner  be  liable  for  any  inaccuracy in any determination with
respect to the amount of the distribution  or  any  required  adjustment
with  respect to the distribution, but the commissioner shall as soon as
practicable after discovery of any error adjust the  next  determination
under this section to reflect any such error.