Eliminates the sales tax on transportation services; repealer

BILL NUMBER:S4633

Title of bill

An act to amend the tax law, in relation to eliminating sales tax on transportation services; and to repeal certain provisions of such law relating thereto

Purpose

The purpose of this bill is to repeal the sales tax and related expenses charged on certain transportation services.

Summary of provisions

Section 1 repeals paragraph 34 of subdivision (b) of section 1101 of the tax law.

Section 2 repeals paragraph 10 of subdivision (c) of section 1105 of the tax law. Section 3 repeals subdivision (1) of section 1106 of the tax law. Section 4 repeals subdivision (o) of section 1111 of the tax law.

Section 5 amends section 1213 of the tax law to exclude certain transportation services from collecting sales tax on the services provided.

Section 6 provides the effective date.

Justification

In 2009 a hidden sales tax was imposed on the livery industry. This new tax was specifically aimed at services for sedans, vans, SUVs and limos, leaving public transportation, taxi's, and buses untaxed. This new responsibility caught the entire industry off guard, and creates an unfair disadvantage to the industry when purchasing tangible property.

This legislation would repeal several provisions that exist in current law in order to equalize the tax burden for the transportation industry. This legislation will provide a much needed tax relief to small businesses, as well as help to offset the rising costs that the livery industry faces.

Legislative history

S.4920A of 2014 passed Senate.

Fiscal implications

$32 million for the first fiscal year being split between State and Local $48 million each year thereafter split between State and Local.

Effective date

This act shall take effect immediately with provisions.