Authorizes the county of Nassau to impose by local laws an excise tax on cigarettes

Summary of provisions

Section 1 of the bill authorizes Nassau County to impose a tax on the use, sale, exchange transfer, storage, withdrawal, possession or retention of cigarettes. Cigarettes would be taxed at a rate of $1.50 for each twenty cigarettes. For packages containing more than twenty cigarettes, the rate of tax for cigarettes in excess of twenty would be $.375 for each five cigarettes or fraction thereof.

Section 2 of the bill defines the term "cigarette." This definition minors the definition of cigarette for purposes of the State excise tax on cigarettes.

Section 3 of the bill provides that the tax shall apply only within Nassau County, is in addition to all other taxes, and the method of collection is subject to approval of the commissioner of taxation and finance.

Section 4 requires a refund whenever the cigarettes are sold and shipped to another state.

Section 5 limits the application of the tax so that it does not apply to circumstances where the state is without power to impose such a tax, or to cigarette sales to the United States or the armed forces.

Section 6 provides for judicial review of any final determination of the amount of the tax imposed pursuant to this act.

Section 7 provides for judicial review of erroneously, illegally, or unconstitutionally collected taxes.

Section 8 provides that, except in the case of willfully false or fraudulent return with intent to evade the tax, no additional tax can be assessed after three years from the date of filing a return.

Section 9 provides that revenues from taxes authorized by this act shall be paid to the treasury of Nassau County to the credit of Nassau County's general fund, except that after the payment of refunds with respect to such taxes, sixty-seven and three-tenths percent of such revenues (including taxes, interest and penalties) must be paid to the state comptroller for deposit and disposition in the same manner as the state excise tax on cigarettes.

Section 10 through 14 make technical adjustments to sections 470, 475, 1111, 1846, and 1847 of the Tax Law to reflect the taxing authority granted by this act.

Justification

Nassau County strongly supports this legislation, which authorizes the County to impose a cigarette tax.

Cigarette smoking has been identified as the number of preventable cause of morbidity and premature mortality worldwide. Smoking is responsible for approximately one in five deaths in the United States. Higher cigarette taxes are an effective way to reduce smoking among both youth and adults.

This bill would also help ameliorate the critical fiscal situation facing Nassau County, in a manner that contemporaneously addresses an important public health concern. Currently, Nassau County is not authorized to impose a cigarette tax. The imposition of a tax on cigarettes will produce much needed revenues at the same time that it potentially cuts down on the tobacco use that has created grave health problems. The imposition of a significant tax on cigarettes can be expected to affect sales among groups such as teenage youth, who have limited discretionary income and who may be discouraged from becoming addicted to tobacco.

This bill will thus have two main beneficial results: a positive effect on health by reducing smoking and saving lives; and a positive fiscal effect by raising a projected $14.8 million in net revenue in 2010 and reducing health care costs in Nassau County.

Prior legislative history

None

Effective date

This act shall take effect immediately.