What's happening
This bill exempts commercial fishing vessels from paying motor fuels and sales tax on diesel fuel used in their operations.
Why it matters
Reduces operational costs for commercial fishing businesses. by exempting them from fuel and sales taxes on diesel, potentially improving the economic viability of New York’s fishing industry and supporting local jobs in coastal communities.
Levels the playing field with other industries and states. where similar fuel tax exemptions already exist, helping New York commercial fishermen remain competitive both regionally and nationally.
May impact state tax revenue. by eliminating a specific taxable category, raising questions about the tradeoff between supporting a targeted industry and the potential reduction in funds available for infrastructure or public services.
Targets the exemption specifically to bona fide commercial fishing operations. (not just recreational or incidental users), meaning the benefits are reserved for businesses that rely on diesel-powered vessels as a core part of their work, and not for general marine fuel sales.
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Who cares
Headline styles
No Fuel Tax for Fishermen
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to investigations and government operations
- Referred to investigations and government operations
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.
Tax Break for Fishermen Fuel
In Assembly Committee · Ways And Means · Sponsor Fred Thiele
Full text
4 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
S. 1600 A. 938
2017-2018 Regular Sessions
SENATE - ASSEMBLY
January 10, 2017
IN SENATE -- Introduced by Sen. LAVALLE -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations
IN ASSEMBLY -- Introduced by M. of A. THIELE -- Multi-Sponsored by -- M. of A. MURRAY -- read once and referred to the Committee on Ways and Means
AN ACT to amend the tax law, in relation to providing an exemption from the payment of the motor fuels tax and the sales tax on motor fuels used in the operation of commercial fishing vessels
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Paragraph (b) of subdivision 3 of section 282-a of the tax law, as amended by section 3 of part W of chapter 59 of the laws of 2013, is amended to read as follows:
(b) The tax on the incidence of sale or use imposed by subdivision one of this section shall not apply to: (i) the sale or use of non-highway Diesel motor fuel, but only if all of such fuel is consumed other than on the public highways of this state (except for the use of the public highway by farmers to reach adjacent farmlands); provided, however, this exemption shall in no event apply to a sale of non-highway Diesel motor fuel which involves a delivery at a filling station or into a repository which is equipped with a hose or other apparatus by which such fuel can be dispensed into the fuel tank of a motor vehicle (except for delivery at a farm site which qualifies for the exemption under subdivision (g) of section three hundred one-b of this chapter); or (ii) a sale to the consumer consisting of not more than twenty gallons of water-white kerosene to be used and consumed exclusively for heating purposes; or (iii) the sale to or delivery at a filling station or other retail vendor of water-white kerosene provided such filling station or other retail vendor only sells such water-white kerosene exclusively for heating
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD02091-01-7
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purposes in containers of no more than twenty gallons; or (iv) a sale of kero-jet fuel to an airline for use in its airplanes or a use of kerojet fuel by an airline in its airplanes; or (v) a sale of kero-jet fuel by a registered distributor of Diesel motor fuel to a fixed base operator registered under this article as a distributor of kero-jet fuel only where such fixed base operator is engaged solely in making or offering to make retail sales not in bulk of kero-jet fuel directly into the fuel tank of an airplane for the purpose of operating such airplane; or (vi) a retail sale not in bulk of kero-jet fuel by a fixed base operator registered under this article as a distributor of kero-jet fuel only where such fuel is delivered directly into the fuel tank of an airplane for use in the operation of such airplane; or (vii) the sale of previously untaxed qualified biodiesel to a person registered under this article as a distributor of Diesel motor fuel other than (A) a retail sale to such person or (B) a sale to such person which involves a delivery at a filling station or into a repository which is equipped with a hose or other apparatus by which such qualified biodiesel can be dispensed into the fuel tank of a motor vehicle; or (viii) the sale of previously untaxed highway Diesel motor fuel by a person registered under this article as a distributor of Diesel motor fuel to a person registered under this article as a distributor of Diesel motor fuel where the highway Diesel motor fuel is either: (A) being delivered by pipeline, railcar, barge, tanker or other vessel to a terminal, the operator of which terminal is registered under section two hundred eighty-three-b of this article, or (B) within such a terminal where it has been so delivered. Provided, however, that the exemption set forth in this subparagraph shall not apply to any highway Diesel motor fuel if it is removed from a terminal, other than by pipeline, barge, tanker or other vessel; or (ix) a sale of Diesel motor fuel to a "commercial fisherman", as such term is defined in subdivision (i) of section three hundred of this chapter, at retail under the circumstances set forth in paragraph one of subdivision (g) of section three hundred one-c of this chapter, and where such commercial fishing vessel is operated by a commercial fisherman.
§ 2. Subdivision 4 of section 282-a of the tax law, as amended by section 5 of part K of chapter 61 of the laws of 2011, is amended to read as follows:
4. The tax imposed by this section on Diesel motor fuel shall be passed through by the seller and included as part of the selling price to each purchaser of such fuel. Provided, however, the amount of the tax imposed by this section may be excluded from the selling price of Diesel motor fuel where (i) a sale of Diesel motor fuel is made to an organization described in paragraph (a) of subdivision three of this section solely for the purpose stated therein; (ii) a sale of non-highway Diesel motor fuel is made to a consumer but only if such non-highway Diesel motor fuel is not delivered to a filling station, nor delivered into a storage tank which is equipped with a hose or other apparatus by which such fuel can be dispensed into the fuel tank of a motor vehicle; or (iii) the sale to or delivery at a filling station or other retail vendor of water-white kerosene provided such filling station or other retail vendor only sells such water-white kerosene exclusively for heating purposes in containers of no more than twenty gallons; or (iv) a sale of kero-jet fuel is made to an airline for use in its airplanes; or (v) a sale of Diesel motor fuel is made to a "commercial fisherman", as such term is defined in subdivision (i) of section three hundred of this chapter, at retail under the circumstances set forth in paragraph one of
S. 1600 3 A. 938
subdivision (g) of section three hundred one-c of this chapter, and where such commercial fishing vessel is operated by a commercial fisherman.
§ 3. Section 301-b of the tax law is amended by adding a new subdivision (j) to read as follows:
(j) Sales or uses of diesel motor fuel and residual petroleum product for commercial fishing. Diesel motor fuel or residual petroleum product sold to or used by a "commercial fisherman", as such term is defined in subdivision (i) of section three hundred of this article, at retail under the circumstances set forth in paragraph one of subdivision (g) of section three hundred one-c of this article, and where such commercial fishing vessel is operated by a commercial fisherman.
§ 4. Subdivision (j) of section 1115 of the tax law, as amended by section 41 of part K of chapter 61 of the laws of 2011, is amended to read as follows:
(j) The exemptions provided in this section shall not apply to the tax required to be prepaid pursuant to the provisions of section eleven hundred two of this article nor to the taxes imposed by sections eleven hundred five and eleven hundred ten of this article with respect to receipts from sales and uses of motor fuel or diesel motor fuel, except that the exemptions provided in paragraphs nine and forty-two of subdivision (a) of this section shall apply to the tax required to be prepaid pursuant to the provisions of section eleven hundred two of this article and to the taxes imposed by sections eleven hundred five and eleven hundred ten of this article with respect to sales and uses of kero-jet fuel, CNG, hydrogen and E85, provided, however, the exemption allowed for E85 shall be subject to the additional requirements provided in section eleven hundred two of this article with respect to E85 and except that the exemption provided in paragraph twenty-four of subdivision (a) of this section shall apply to the taxes imposed by sections eleven hundred five and eleven hundred ten of this article with respect to sales and uses of diesel motor fuel used in the operation of a fishing vessel as described in paragraph twenty-four of subdivision (a) of this section. The exemption provided in subdivision (c) of this section shall apply to sales and uses of non-highway diesel motor fuel but only if all of such fuel is consumed other than on the public highways of this state. The exemption provided in subdivision (c) of this section shall apply to sales and uses of non-highway diesel motor fuel for use or consumption either in the production for sale of tangible personal property by farming or in a commercial horse boarding operation, or in both but only if all of such fuel is consumed other than on the public highways of this state (except for the use of the public highways to reach adjacent farmlands or adjacent lands used in a commercial horse boarding operation, or both).
§ 5. Subdivision (j) of section 1115 of the tax law, as amended by section 41-a of part K of chapter 61 of the laws of 2011, is amended to read as follows:
(j) The exemptions provided in this section shall not apply to the tax required to be prepaid pursuant to the provisions of section eleven hundred two of this article nor to the taxes imposed by sections eleven hundred five and eleven hundred ten of this article with respect to receipts from sales and uses of motor fuel or diesel motor fuel, except that the exemption provided in paragraph nine of subdivision (a) of this section shall apply to the tax required to be prepaid pursuant to the provisions of section eleven hundred two of this article and to the taxes imposed by sections eleven hundred five and eleven hundred ten of
S. 1600 4 A. 938
this article with respect to sales and uses of kero-jet fuel and except that the exemption provided in paragraph twenty-four of subdivision (a) of this section shall apply to the taxes imposed by sections eleven hundred five and eleven hundred ten of this article with respect to sales and uses of diesel motor fuel used in the operation of a fishing vessel as described in paragraph twenty-four of subdivision (a) of this section. The exemption provided in subdivision (c) of this section shall apply to sales and uses of non-highway diesel motor fuel but only if all of such fuel is consumed other than on the public highways of this state. The exemption provided in subdivision (c) of this section shall apply to sales and uses of non-highway diesel motor fuel for use or consumption either in the production for sale of tangible personal property by farming or in a commercial horse boarding operation, or in both but only if all of such fuel is consumed other than on the public highways of this state (except for the use of the public highways to reach adjacent farmlands or adjacent lands used in a commercial horse boarding operation, or both).
§ 6. This act shall take effect on the first day of a sales tax quarterly period, as described in subdivision (b) of section 1136 of the tax law, next commencing at least ninety days after this act shall have become a law; sections four and five of this act shall apply to sales made under and uses occurring on or after the dates such sections four and five shall have taken effect, respectively, although made or occurring under a prior contract; and provided further that such amendments made by section four of this act shall be subject to the expiration and reversion of such subdivision pursuant to section 19 of part W-1 of chapter 109 of the laws of 2006, as amended, when upon such date the provisions of section five of this act shall take effect.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the tax law, in relation to providing an exemption from the payment of the motor fuels tax and the sales tax on motor fuels used in the operation of commercial fishing vessels
Purpose
Provides a motor fuel tax exemption for sales of diesel motor fuel made to commercial fishermen.
Summary of provisions
This bill amends the tax law in order to eliminate the statute that requires the payment and subsequent refund of the eight cent diesel excise tax and the sales tax on diesel fuel when sold to operators of commercial fishing vessels. Under the current law, both taxes must be paid by commercial fishermen, notwithstanding their exempt status from these taxes. The commercial fishermen are then allowed to file for a refund of these taxes from the Department of Taxation and Finance.
Justification
The original intent of this policy, as it relates to commercial fishing vessels, was to prevent tax evasion in the diesel fuel industry. However, it was not intended to be burdensome to many of the state's industries such as commercial fishermen and their fuel distributors.
The implementation of this law has caused a great deal of hardship for commercial fishermen. A fisherman, operating a trawler vessel burning 85,000 gallons per year, must advance approximately $13,600 annually in taxes to the State. The negative financial consequences of this cash flow are a large burden for the commercial fishermen of this state.
The negative impacts of this law have also been carried over to the fuel distributors of the commercial fishermen. Because of the payment requirement, many fishermen are now purchasing their fuel at ports outside of New York. This will result in the loss of thousands of dollars in revenue for the state's fuel distributors. This legislation would no longer require commercial fishermen to pay any excise or state sales taxes for the purchase of diesel motor fuel.
Legislative history
2015-16 S.331/A.152; 2013-14 S.782B/A.138B; 2012 S.6879; 2009-10 A.1903A; 2007-08 A.989; 2005-06 A.3854; 2003-04 A.1416; 2001-02 A.2289; 1999-00 A.2840A.
Fiscal implications
To be determined.
Effective date
This act shall take effect on the first day of a sales tax quarterly period, as described in subdivision (b) of Section 1136 of the tax law, next commencing at least ninety days after this act shall have become law, sections four and five of this act shall apply to sales made under and uses occurring on or after the dates such sections four and five shall have taken effect, respectively, although made or occurring under a prior contract; and provided further that the amendments made by section four of this act shall be subject to the expiration and reversion of such subdivision pursuant to Section 19 of part W-1 of Chapter 109 of the laws of 2006, as amended, when upon such date the provisions of section five of this act shall take effect.
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