What's happening
This bill repeals the stock transfer tax rebate, redirects stock transfer tax revenues to state infrastructure, housing, transit, education, and environmental programs, and establishes a safe water infrastructure aid program.
Why it matters
Repealing the stock transfer tax rebate means major Wall Street firms and high-volume traders will no longer receive automatic refunds. on the state’s stock transfer tax, potentially increasing annual state revenues by billions and shifting the financial burden from the state to the financial sector.
Redirection of stock transfer tax revenues to a wide range of public programs creates a new durable funding stream for infrastructure, transit, housing, education, and environmental initiatives. This means long-term, predictable investment in public goods, including the MTA, affordable housing, Amtrak, SUNY/CUNY, health care, clean energy, and water systems, rather than funds being funneled back to the financial industry or used for fiscal emergencies in NYC.
The establishment of a Safe Water Infrastructure Aid Program ensures dedicated, recurring support for repairing and upgrading local water, stormwater, and sewer systems statewide. This could improve public health, reduce municipal costs, and help meet federal/state clean water standards, especially for smaller or under-resourced communities.
Tightening enforcement and collection of the stock transfer tax—requiring proof of tax payment to establish legal ownership of stocks and broadening tax applicability to transactions with any New York nexus—could close loopholes. , increase compliance, and ensure that the financial sector contributes more reliably to state revenues.
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Who cares
Stock purchasers and securities firms
The bill would end stock transfer tax rebates, make buyers responsible for paying unless the parties agree otherwise, and require proof of tax payment for legal ownership.
MTA and non-MTA transit systems
The bill would dedicate shares of stock transfer tax revenue to MTA operations and capital projects and to other downstate and upstate transit systems.
Municipal governments and water system operators
The bill would fund local road improvements and establish aid for municipally owned drinking water, storm water and sewer systems, with water infrastructure funding at least equal to CHIPS appropriations starting in 2027.
Housing agencies and public housing residents
The bill would direct revenue to affordable housing programs and habitability improvements through the Division of Housing and Community Renewal, and to NYCHA solely for Section 9 housing.
Headline styles
End Stock Tax Rebates
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to finance
- Print number 1237a
- Amend and recommit to finance
- Referred to finance
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 Stock Tax Rebates
In Assembly Committee · Ways And Means · Sponsor Phil Steck
Full text
7 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1237--A
2025-2026 Regular Sessions
IN SENATE
January 8, 2025
Introduced by Sens. SANDERS, BRISPORT, CLEARE, COMRIE, FAHY, FERNANDEZ, GIANARIS, GONZALEZ, HOYLMAN-SIGAL, JACKSON, MAY, MYRIE, PARKER, RAMOS, RIVERA, SALAZAR, SEPULVEDA, SERRANO, STAVISKY -- read twice and ordered printed, and when printed to be committed to the Committee on Finance -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee
AN ACT to amend the state finance law, in relation to the repeal of the rebate for stock transfer tax paid and the funds of the stock transfer tax fund and the dedicated infrastructure investment fund; to amend the environmental conservation law, in relation… Show allHide
AN ACT to amend the state finance law, in relation to the repeal of the rebate for stock transfer tax paid and the funds of the stock transfer tax fund and the dedicated infrastructure investment fund; to amend the environmental conservation law, in relation to establishing the safe water infrastructure action program for the purpose of making payments toward the replacement and rehabilitation of existing local municipally-owned and funded drinking water, storm water and sanitary sewer systems; to amend the tax law, in relation to taxes imposed in certain transactions; to repeal section 280-a of the tax law relating to the rebate for stock transfer tax paid; to repeal section 92-i of the state finance law relating to the stock transfer incentive fund; and to repeal certain provisions of the administrative code of the city of New York relating thereto
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 280-a of the tax law is REPEALED.
§ 2. Section 92-i of the state finance law is REPEALED.
§ 3. Section 92-b of the state finance law, as added by chapter 91 of the laws of 1965, subdivision 3 as amended by chapter 878 of the laws of 1977, subdivision 4 as amended by chapter 724 of the laws of 1979, subdivision 5 as added and subdivision 6 as renumbered by section 2 of chapter 3 of the laws of 1966, subdivision 7 as added by section 10 of part SS1 of chapter 57 of the laws of 2008 and such section as renumbered by section 1 of chapter 3 of the laws of 1966, is amended to read as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00700-05-5
§ 92-b. Stock transfer tax fund. 1. There is hereby established in the custody of the commissioner of taxation and finance a special fund, to be known as the stock transfer tax fund.
2. Such fund shall consist of the revenues derived from the stock transfer tax imposed by article twelve of the tax law and all other moneys credited or transferred thereto from any other fund or source pursuant to law.
3. The moneys received from such tax and other sources in such fund[, after deducting the amount the commissioner of taxation and finance shall determine to be necessary for] shall be used to cover the reasonable costs of the state tax commission in administering, collecting and distributing [such] the stock transfer tax, commencing with the fiscal year ending March thirty-first, [nineteen hundred seventy-seven] two thousand twenty-seven, [shall be appropriated to (i) the municipal assistance corporation for the city of New York created pursuant to title three of article ten of the public authorities law in order to enable such corporation to fulfill the terms of any agreements made with the holders of its notes and bonds and to carry out its corporate purposes including the maintenance of the capital reserve fund and (ii) to the extent such moneys are not required by such corporation as provided in subdivision seven of section ninety-two-d of this chapter and, after deducting the amount such commissioner shall determine to be necessary for reasonable costs of the state tax commission in administering and making distributions in accordance with the provisions of section two hundred eighty-a of the tax law from the stock transfer incentive fund, to the stock transfer incentive fund created pursuant to section ninety-two-i of this chapter to enable rebates to be made from such fund under the provisions of section two hundred eighty-a of the tax law and (iii) to the extent such moneys are not required by such fund, as certified by the commissioner of taxation and finance, the balance shall be appropriated to the city of New York, for the support of local government.] and the remainder shall be deposited into the state general fund. Commencing with the fiscal year ending March thirty-first, two thousand twenty-seven, such remainder shall be deposited into the following funds:
(i) ten percent shall be directed to the metropolitan transportation authority financial assistance fund established pursuant to section ninety-two-ff of this article, of which fifty percent shall be used for the purpose of operations and fifty percent shall be used for the purpose of capital projects;
(ii) five percent shall be directed to the division of housing and community renewal for the purpose of affordable housing programs, capital projects and other improvements to address issues relating to affordable housing, conditions of governance and habitability, including but not limited to, heating, mold, or lead, and other such conditions affecting the health and safety of residents;
(iii) five percent shall be directed to the New York city housing authority for the sole purpose of section nine housing;
(iv) five percent shall be directed to the highway and bridge capital account in the dedicated highway and bridge trust fund established pursuant to section eighty-nine-b of this article;
(v) five percent shall be directed to the dedicated highway and bridge trust fund established pursuant to section eighty-nine-b of this article, to be directed towards the infrastructure, maintenance and development of rail lines for AMTRAK in the northeast corridor;
(vi) five percent shall be directed to the local infrastructure account of the general fund established pursuant to section seventy-two of this article to be directed to the Consolidated Local Street and Highway Improvement Program (CHIPS);
(vii) five percent shall be directed to the local infrastructure account of the general fund to be dedicated to the safe water and infrastructure action program as established by section 3-0323 of the environmental conservation law;
(viii) five percent shall be directed to the municipal assistance state aid fund established pursuant to section ninety-two-e of this article;
(ix) five percent shall be directed to the dedicated mass transportation trust fund to the credit of the non-MTA account for payment to downstate transit systems other than those transit systems operated by the metropolitan transportation authority;
(x) five percent shall be directed to the dedicated mass transportation trust fund to the credit of the non-MTA account for payment to upstate transit systems;
(xi) ten percent shall be directed to the energy research development operating fund pursuant to the provisions of section eighteen hundred fifty-nine of the public authorities law, to be directed to the clean energy fund and shall be divided equally among the four investment portfolios that make up such fund;
(xii) two and one-half percent shall be directed to the city university of New York, of which fifty percent shall be used for the purpose of capital improvements and infrastructure projects and fifty percent shall be used for the purpose of supporting academic programs at city of New York institutions;
(xiii) two and one-half percent shall be directed to the state university of New York institutions, of which fifty percent shall be used for the purposes of supporting and expanding services and care at state university of New York hospitals, state university of New York academic medical centers and fifty percent shall be used for the purpose of supporting academic programs at state university of New York institutions;
(xiv) ten percent shall be directed to the department of education for the purpose of supporting foundation aid;
(xv) ten percent shall be directed to the department of health to support health care; and
(xvi) ten percent shall be directed to the department of agriculture, department of environmental conservation, and office of parks, recreation and historic preservation for the purposes of reforestation, soil conservation, sustainable agriculture, local parks and open space.
4. [After the deduction of such costs of the state tax commission in administering, collecting and distributing such tax, the balances in the stock transfer tax fund so appropriated shall be distributed and paid on the last business day of September, December, March and June into the special account established for the municipal assistance corporation for the city of New York in the municipal assistance tax fund established pursuant to subdivision one of section ninety-two-d of this chapter, unless and to the extent the balances in such fund on each such payment day are not required by such corporation as provided in said subdivision seven of said section ninety-two-d in which case the balance not so required, if any, after the deduction of such costs of the state tax commission in administering and making distributions in accordance with the provisions of section two hundred eighty-a of the tax law from the stock transfer incentive fund shall be distributed and paid to the stock transfer incentive fund in the custody of the commissioner of taxation and finance established pursuant to section ninety-two-i of this chapter and unless and to the extent that the balances in the stock transfer tax fund on each such payment day are not required by the stock transfer incentive fund as provided in such section ninety-two-i of this chapter in which case the balance not so required, if any, shall be distributed and paid to the chief fiscal officer of the city of New York to be paid into the treasury of the city to the credit of the general fund or paid by the commissioner of taxation and finance to such other account or fund as may be designated in writing by such chief fiscal officer at least ten business days prior to such last day and on each such day, the commissioner of taxation and finance shall certify to the comptroller the amount deducted for administering, collecting and distributing such tax during such quarterly period and shall pay such amount into the general fund of the state treasury to the credit of the state purposes fund therein. In no event shall any amount (other than the amount to be deducted for administering, collecting and distributing such tax) be distributed or paid from the stock transfer tax fund to any person other than the municipal assistance corporation for the city of New York unless and until the aggregate of all payments certified to the comptroller as required by such corporation in order to comply with its agreements with the holders of its notes and bonds and to carry out its corporate purposes, including the maintenance of the capital reserve fund, which remain unappropriated or unpaid to such corporation shall have been appropriated to such corporation and shall have been paid in full provided, however, that no person, including such corporation or the holders of its notes or bonds shall have any lien on such tax and such agreements shall be executory only to the extent of the balances available to the state in such fund. If the balances in such fund are not required by such corporation pursuant to the provisions of this subdivision, on each such last business day of September, December, March and June, the commissioner of taxation and finance shall certify to the comptroller the amount deducted for administering and making distributions in accordance with the provisions of section two hundred eighty-a of the tax law from the stock transfer incentive fund during such quarterly period and he shall pay such amount into the general fund of the state treasury to the credit of the state purposes fund therein. To the extent such moneys are not required by such corporation, as provided in subdivision seven of section ninety-two-d of this chapter, no amount thereof (other than such amount to be deducted for administering, collecting and distributing such tax and such costs in administering and making distributions in accordance with the provisions of section two hundred eighty-a of the tax law from the stock transfer incentive fund) shall be distributed or paid from the stock transfer tax fund other than to such stock transfer incentive fund in the custody of the commissioner of taxation and finance unless and until the aggregate of all payments certified to the comptroller by such commissioner pursuant to the provisions of such incentive fund as necessary to provide payments on account of rebates authorized pursuant to section two hundred eighty-a of the tax law which remain unappropriated or unpaid to such fund shall have been appropriated to such fund and shall have been paid in full provided, however, that no person, including any taxpayer under article twelve of the tax law or any member or dealer referred to in subdivisions two-a and six of section two hundred eighty-a of such law, shall have any lien on this fund or the stock transfer incentive fund.
5. In no fiscal year shall the total amount paid from the fund exceed the total collections during such fiscal year from the stock transfer tax pursuant to the provisions of article twelve of the tax law and as deposited to the credit of the stock transfer tax fund.
6.] All payments from the stock transfer tax fund shall be made on the audit and warrant of the comptroller on vouchers approved by the commissioner of taxation and finance.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the state finance law, in relation to the repeal of the rebate for stock transfer tax paid and the funds of the stock transfer tax fund and the dedicated infrastructure investment fund; to amend the environmental conservation law, in relation to establishing the safe water infrastructure action program for the purpose of making payments toward the replacement and rehabilitation of existing local municipal- ly-owned and funded drinking water, storm water and sanitary sewer systems; to amend the tax law, in relation to taxes imposed in certain transactions; to repeal section 280-a of the tax law relating to the rebate for stock transfer tax paid; to repeal section 92-i of the state finance law relating to the stock transfer incentive fund; and to repeal certain provisions of the administrative code of the city of New York relating thereto
Purpose
To reinstate the Stock Transfer Tax of 1905.
Summary of provisions
Section 1: Repeals Section 280-a of the tax law
Read the full memo (1,031 words)
Section 2: Repeals Section 92-i of the state finance law
Section 3: Directs how the stock transfer tax revenue is allocated
Section 4: Amends Section 93-b of the state finance law
Section 5: Establishes that in no fiscal year shall the total amount paid from the fund exceed the total collections during such fiscal year
Section 6: Establishes that all payments from the stock transfer tax fund shall be made on the audit and warrant of the comptroller
Section 7: Establishes that the comptroller must notify the commissioner of taxation-and finance that all remaining funds held in the stock transfer tax fund must be released to the stock transfer incentive fund
Section 8: Creates the Safe Water and Infrastructure Action Program
Section 9: Amends subdivision 3 of section 270 of the tax law
Section 10: This act shall take effect immediately
Justification
The stock transfer tax was first adopted in 1905 by the Republican Party because the State needed revenue and the Republicans preferred sales taxes (which STT is) to income and real property taxes. The New York Times panned it, claiming the Stock Exchange would move to New Jersey. In fact, the NYSE created a corporation symbolically for that purpose but took no steps toward moving out of New York. The New York Times was wrong. Volume on the exchange increased, the New York exchanges pros- pered, and all the other exchanges that did not have the tax died out. The proceeds of the tax were diverted in the 1970s to New York City to address the financial crisis the City was facing at that time. It was eliminated in 1981, ostensibly because NYC had recovered, forgetting about other needs of the City and State as a whole. This was also the Reagan era, marked by artificial exuberance about the stock market in general (which was later adopted by Bill Clinton, contributing to the financial crisis of 2008).
The Stock Transfer Tax is a sales tax of 0.1% or 0.001 on the sale of stock up to a maximum per transaction of $350. For example, the tax on the purchase of a stock that costs $100 Would be ten cents. The STT operates the same as any sales tax. When you go to the store and pay sales tax, the customer (in this case, the investor) pays, not the store owner (in this case, the stock exchange). The store owner simply collects the tax and remits it to the government. If the tax is too high, no one will buy the product, and the store owner is harmed. If the tax is set low enough to be inconsequential, the seller is not harmed at all.
Most people who buy stock in New York are non-New Yorkers, either from other states or foreign countries. Approximately 40% of all stock sold worldwide is sold in New York. Finance is our greatest resource in New York. For example, if Texans wish to trade in New York, they pay no tax to the state of New York. However, New Yorkers pay tax on Texas oil, which is one reason their tax burden is lower than ours.
Should the Stock Transfer Tax be enacted, Yale Economist Jim Henry esti- mates it will raise as much as $60 billion based on the average share price and volume of the New York Stock Exchange(1).
When the STT first passed, the tax was collected by buying stamps, which were then affixed to the stock certificates as proof that the tax had been paid. Without the stamps, the transaction was not enforceable under New York law. The tax would be remitted electronically today. The objection has been raised that the NYSE would move transactions to "the cloud" to escape the tax, but transactions are already done on "the cloud." "The cloud" is not mysterious; it is simply a series of linked computers. As long as some portion of the computer activity (or even a phone call) is invovolved in the transaction that takes place in New York, it is taxable here (see the 2018 Supreme Court decision in South Dakota v. Wayfair) (2)
The funding breakdown is as follows:
*10% - Metropolitan Transportation Authority (MTA)
*5% - Division of Housing and Community Renewal
*5% - New York City Housing Authority (for the sole purpose of section nine housing)
*5% - Highway and Bridge Trust Fund (capital account)
*5% - AMTRAK
*5% - CHIPS (Consolidated Local Street and Highway Improvement Program)
*5% - SWAP (Safe Water and Infrastructure Action Program) *5% - AIM (Aid and Incentives to Municipalities)
*5% - Downstate non-MTA Transit
*5% - Upstate Transit
*10% - Clean Energy Fund (via NYSERDA)
*2.5% - City University of New York (CUNY)
*2.5% - State University of New York (SUNY)
*10% - Department of Education *10% - Department of Health
*10% - Department of Agriculture / DEC / Parks & Recreation (reforesta- tion)
Legislative history
2023/2024: a4574a/s1297a- referred to ways and means/referred to finance
2021/2022: a3353a/s1406a- referred to ways and means/referred to finance
Fiscal implications
Up to $60 billion in revenue to New York State
Effective date
This act will take effect immediately (1) https://drive.google.com/file/d/lv xNXrdJtoKnsMiGzzQPfH9tkMzy/ view?usp-sharing 2 https://www.supremecourtgov/opinions/17pdf/17-494 j4el.pdf
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.