New York Codes, Rules and Regulations › Title 20 - DEPARTMENT OF TAXATION AND FINANCE › Chapter I - Franchise and Certain Business Taxes › Subchapter I - Cigarette Tax, Cigarette Marketing Standards And Tobacco Products Tax › Article 1 - Cigarette Tax › Part 79 - Miscellaneous Provisions › Section 79.3 - Tax due on inventory based on increased cigarette tax

Current through Register Vol. 46, No. 28, July 10, 2024
Tax Law, §§ 471 and 475
(a) Effective June 3, 2008, amendments made
					 by part RR-1 of chapter 57 of the Laws of 2008 to section 471 of article 20 of
					 the Tax Law increased the tax on cigarettes possessed in New York State by any
					 person for sale from $1.50 to $2.75 for each 20 cigarettes or fraction thereof.
					 Provided, however, if a package of cigarettes contains more than 20 cigarettes,
					 the rate of tax on those cigarettes in excess of 20 increased from 371/2 cents
					 to 683/4 cents for each five cigarettes or fraction thereof.
(b) Every dealer of cigarettes, including
					 agents licensed to purchase and affix stamps, shall take a physical inventory
					 of all cigarettes possessed in this State as of the close of business on June
					 2, 2008. In addition, every dealer who is a licensed agent shall take a
					 physical inventory of all unaffixed cigarette tax stamps possessed as of the
					 close of business on such date. Because it may be impossible to take a physical
					 inventory of cigarettes in all vending machines that are on location throughout
					 the State, a dealer may take as many physical inventories of the contents of
					 such machines as is possible with available personnel. For those machines that
					 cannot be physically inventoried as of the close of business on June 2, 2008,
					 cigarettes may be accounted for at one-half of the normal fill capacities of
					 such machines, as reflected in the individual inventory records maintained for
					 such machines.
(c)
Returns
					 and payments.
(1)
(i) On or before August 20, 2008, every such
					 dealer shall file a return with the Department of Taxation and Finance, on a
					 form prescribed by the department for such purpose, showing the quantity of all
					 cigarettes and unaffixed stamps possessed as of the June 2, 2008, close of
					 business inventory. Such return must reflect the entire wholesale and/or retail
					 inventories of the dealer within the State, as required by the department,
					 regardless of the number of business locations of the dealer. Except as
					 provided in subparagraph (ii) of this paragraph, every dealer shall pay, with
					 the filing of such return, an additional amount of tax for all cigarettes in
					 such inventory which are contained in packages bearing stamps evidencing tax
					 payment at the rates in effect prior to June 3, 2008, and for all unaffixed
					 cigarette tax stamps in such inventory evidencing tax payment at such rates.
					 The additional amount of tax shall be paid at the rate of $1.25 for each 20
					 cigarettes or fraction thereof unless cigarettes are contained in packages of
					 more than 20, in which case the additional amount of tax for those cigarettes
					 in excess of 20 shall be at the rate of 311/4cents for each five cigarettes or
					 fraction thereof ($1.5625 per package of 25 cigarettes). Such tax shall be paid
					 regardless of whether the affixed or unaffixed stamps show payment of the New
					 York State tax or both the New York State and City of New York taxes.
(ii) Notwithstanding any other provision of
					 this Title to the contrary, a dealer who has additional amount of tax due on
					 inventory based on the increased cigarette tax may elect to pay such tax in two
					 installments. The first installment is due with the filing of the return on or
					 before August 20, 2008, and shall not be less than 25 percent of the entire
					 additional amount of tax due. Provided, however, in no event shall such
					 installment be less than $500 or the entire additional amount of cigarette tax
					 due, if less than $500. Thus a dealer having an additional amount of tax due on
					 inventory based on the increased cigarette tax of $400 would be liable for the
					 full payment on August 20, 2008; a dealer having such a liability of $1,000
					 would be liable for a first installment of at least $500; and a dealer having
					 such a liability of $10,000 would be liable for a first installment of at least
					 $2,500 ($10,000 x 25 percent). The second and final installment must be paid to
					 the department on or before December 22, 2008, and must be accompanied by a
					 final payment document prescribed by the department for this purpose. Where the
					 department has cause to believe that the final installment of the additional
					 amount of tax due on inventory may be jeopardized by delay, the department may
					 require such payment at any time prior to December 22, 2008. (See subdivision
					 [d] of this section for sanctions concerning untimely installments.)