What's happening
This bill repeals the New York State personal income tax deduction for percentage depletion related to natural resources.
Why it matters
Removes a tax advantage for natural resource extractors. By repealing the percentage depletion deduction, companies and individuals involved in mining, oil, gas, and similar industries can no longer claim this special tax benefit, which previously allowed them to deduct a fixed percentage of their gross income from natural resource extraction.
Equalizes tax treatment across industries. The change makes the tax code more neutral by eliminating a subsidy specific to natural resource industries, potentially leveling the playing field for other sectors that do not receive similar deductions.
May increase state tax revenues. Without this deduction, those earning income from resource extraction will likely pay higher state income taxes, which may result in increased funding for state programs or services.
Signals a shift in policy toward fossil fuels and natural resources. The repeal could be seen as part of a broader move to discourage fossil fuel extraction and incentivize other forms of economic activity, aligning with environmental and fiscal responsibility goals.
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Who cares
Headline styles
End Tax Break for Depletion
Plain English, a few words. Used as the page title.
Sponsors
2 Co-sponsors
History
- Print number 1239a
- Amend (t) and recommit to ways and means
- Referred to ways and means
- Referred to ways and means
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
End Depletion Tax Deduction
In Senate Committee · Investigations And Government Operations · Sponsor Patrick M. Gallivan
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1239--A
2017-2018 Regular Sessions
IN ASSEMBLY
January 11, 2017
Introduced by M. of A. CUSICK, SCHIMMINGER, WALTER -- read once and referred to the Committee on Ways and Means -- recommitted to the Committee on Ways and Means in accordance with Assembly Rule 3, sec. 2 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee
AN ACT to amend the tax law and the administrative code of the city of New York, in relation to making technical corrections thereto; to repeal subsection (i) of section 612 of the tax law relating to the elimination of the personal income tax deduction for percentage depletion; and to repeal certain provisions of the tax law relating thereto
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subsection (i) of section 612 of the tax law is REPEALED.
§ 2. Subdivision (i) of section 11-1712 of the administrative code of the city of New York, as amended by chapter 333 of the laws of 1987, is amended to read as follows:
(i) In the case of mines, oil and gas wells and other natural deposits, any allowance for percentage depletion pursuant to section six hundred thirteen or section six hundred thirteen A of the internal revenue code shall be added to federal adjusted gross income. However, with respect to the property as to which such addition to federal adjusted gross income is required, an allowance for depletion shall be subtracted from federal adjusted gross income in the amount that would be deductible under section six hundred eleven of such code if the deduction for an allowance for depletion were computed without reference to such section six hundred thirteen or section six hundred thirteen A. [With respect to the computation of depletion pursuant to this subdivision, the basis for such computation shall be the basis for state income tax purposes provided for in subsection (i) of section six hundred twelve of the tax law.] The portion of any gain from the sale or other
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00461-03-8
A. 1239--A 2
disposition of such property having a higher adjusted basis for city income tax purposes than for federal income tax purposes, that does not exceed such difference in basis, shall be subtracted from federal adjusted gross income.
§ 3. Paragraph 10 of subsection (b) of section 612 of the tax law is REPEALED.
§ 4. Paragraph 13 of subsection (c) of section 612 of the tax law is REPEALED.
§ 5. Subsection 4 of section 618 of the tax law, as amended by section 9 of part C of chapter 25 of the laws of 2009, is amended to read as follows:
(4) There shall be added or subtracted (as the case may be) the modifications described in paragraphs (6)[, (10)], (17), (18), (19), (20), (21), (22), (23), (24), (25), (26), (27), (29), (38) and (39) of subsection (b) and in paragraphs (11)[, (13)], (15), [(19),] (20), (21), (22), (23), (24), (25), (26) and (28) of subsection (c) of section six hundred twelve of this part.
§ 6. Subsection 4 of section 618 of the tax law, as separately amended by section 5 of part HH-1 of chapter 57 of the laws of 2008 and section 9 of part C of chapter 25 of the laws of 2009, is amended to read as follows:
(4) There shall be added or subtracted (as the case may be) the modifications described in paragraphs (6)[, (10)], (17), (18), (19), (20), (21), (22), (23), (24), (25), (26), (27), [(28),] (29), (38) and (39) of subsection (b) and in paragraphs (11)[, (13)], (15), [(19),] (20), (21), (22), (23), (24), (25), (26) and (28) of subsection (c) of section six hundred twelve of this part.
§ 7. This act shall take effect immediately and shall apply to all taxable years beginning on or after January 1, 2018; provided that the amendments to subsection 4 of section 618 of the tax law made by section five of this act shall be subject to the expiration and reversion of such subdivision pursuant to section 8 of chapter 782 of the laws of 1988, as amended, when upon such date the provisions of section six of this act shall take effect.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
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