Authorizes a credit for beer produced within NYC by a taxpayer that is registered as a distributor under article 18 of the tax law

1 Co-sponsor

• Timothy M. Kennedy

Title of bill

An act to amend the administrative code of the city of New York, in relation to establishing a credit for beer produced within the city of New York by a taxpayer that is registered as a distributor under article eighteen of the tax law

Purpose

To encourage the growth of New York City breweries by establishing a beer production tax credit in the New York City Administrative Code.

Summary of provisions

Section 1 of this bill adds a new subdivision (p) to section 11-503 of the New York City Administrative Code to provide a beer production business tax credit for beer distributors that produce 60 million or fewer gallons of beer in New York City. The tax credit shall be 12 cents per gallon for the first 500,000 of beer produced, and three and eighty-six one hundredths cents per gallon thereafter until 15,500,000 gallons.

Section 2 of this bill adds a new subdivision 22 to section 11-654 of the New York City Administrative Code to provide a beer production corporate tax credit for beer distributors that produce 60 million or fewer gallons of beer in New York City. The amount of the credit shall equal that specified for the business tax credit established in section 1 of the bill, and likewise applicable to the first 15,500,000 gallons only.

Section 3 of this bill provides that this act shall take effect immediately and apply to taxable years beginning on or after January 1, 2017.

Justification

In 2012, New York State established a beer production tax credit with the aim of continuing the State's support of breweries, particularly craft brewers, while removing certain elements from the prior tax credit scheme that had rendered it unconstitutional. This bill extends the 2012 credit to taxes payable to New York City. While the credit proposed by this bill largely follows the credit established for New York State taxes in the 2012 legislation, there are a few notable exceptions. First, this bill establishes a tax credit of 12 cents per gallon for the first 500,000 of beer produced, as opposed to 14 cents in the 2012 amendments to the Tax Law. Second, this bill provides a credit of three and eight-six one hundredths cents per gallon of beer produced in excess of 500,000 gallons, as opposed to the four-and-a-half cents per gallon credit provided in the Tax Law.

Legislative history

2013-14: S.5594 - Referred to Cities

Fiscal implications

To be determined.

Effective date

This act shall take effect immediately and apply to taxable years beginning on or after January 1, 2017.