Current through Register Vol. 46, No. 12, March 20, 2024
Tax Law, §§ 471(1), 471-a, 475 and
481(2)
(a)
(1) No tax will be imposed under article 20
of the Tax Law on cigarettes sold to or by the United States of America or any
of its agencies or instrumentalities, including voluntary unincorporated
organizations of any branch of the armed forces of the United States which are
operating places for the sale of goods pursuant to regulations promulgated by
the departmental Secretary having jurisdiction over such branch, provided such
cigarettes are sold, used or consumed by such entities exclusively in the
exercise of governmental functions or are used or consumed by authorized
purchasers within the confines of a military reservation, facility or other
Federal area.
(2)
(i) The United States as
used in this section includes any department, office, bureau or other agency of
the government of the United States.
(ii)
Agencies and
instrumentalities of the United States as used in this section means
any governmental authority, commission or independent board created by an act
of Congress for a public purpose, and which is immune from state taxation. Some
entities, although created by an act of Congress, are not governmental entities
and are not exempt from the cigarette tax. Where Congress has waived immunity
from taxation with respect to instrumentalities or agencies of the United
States, no exemption from tax will exist. Further, states of the United States
and their political subdivisions (excluding New York State), the District of
Columbia, and territories and possessions of the United States are not exempt
from the cigarette tax.
(iii)
Authorized purchasers as used in this section means any person
authorized by the United States to make purchases from commissaries, ship's
stores or voluntary unincorporated organizations of the armed forces of the
United States.
(b)
(1) No
tax will be imposed under article 20 of the Tax Law on cigarettes sold to New
York State or any of its agencies or instrumentalities provided such cigarettes
are used or consumed by such entities exclusively in the exercise of
governmental functions and provided such cigarettes are not for purposes of
resale. Sales of cigarettes by the State or any of its agencies or
instrumentalities, except as may be provided for in section
1846 of the Tax Law with respect to
forfeited cigarettes, are subject to tax.
(2)
(i)
New York State as used in this section includes any
department, office, bureau or other agency of the State of New York.
(ii)
Agencies and
instrumentalities of the State as used in this section means
any authority, commission or independent board created by an act of the
Legislature for a public purpose.
(c) Notwithstanding section
70.2 of
this Title, a use of cigarettes by a governmental entity for purposes of this
section shall include the gratuitous distribution of cigarettes within the
scope of any governmental activity.
(d)
(1)
United States governmental entities and New York State governmental entities
(as defined herein) may purchase cigarettes upon which the seller has not
prepaid and precollected the cigarette tax by issuing to the seller of such
cigarettes a signed government purchase order, a signed government purchase
contract or an appropriate exemption document. For purposes of this
subdivision, an appropriate exemption document must be made by the governmental
entity claiming an exemption from tax, on its letterhead or on a printed form
issued by it, identifying itself as an exempt United States governmental entity
or as an exempt New York State governmental entity. An appropriate exemption
document must also contain a statement to the effect that the cigarettes being
purchased will be used or consumed exclusively by the subject governmental
entity or, in the case of a United States entity, that such cigarettes will be
resold to authorized purchasers. Such document must be signed and dated by a
duly authorized representative of the governmental entity seeking an exemption
from the cigarette tax.
(2) Whether
a single tax exempt purchase of cigarettes is made or multiple tax exempt
purchases of cigarettes are made, pursuant to any particular purchase order,
purchase contract, or appropriate exemption document, each delivery of
cigarettes must be substantiated as being exempt from tax with an individual
bill, invoice, receipt or other form of written evidence given by the seller
showing the governmental entity as the purchaser. Every bill, invoice, receipt
or other form of written evidence must indicate the quantity of cigarettes
delivered, the purchase price of the cigarettes without regard to any exemption
and the price paid or to be paid by the exempt purchaser for such cigarettes.
In addition, such evidence of exemption must be signed and dated by the
individual taking delivery of the cigarettes on behalf of such
entity.
(3) Sellers of cigarettes
must establish an acceptable system of associating copies of these individual
bills, invoices, receipts and other forms of evidence of exemption from tax
with the applicable purchase orders, purchase contracts or appropriate
exemption documents. All purchases of cigarettes upon which the seller has not
prepaid and precollected the cigarette tax by a United States governmental
entity or a New York State governmental entity must be billed directly to the
governmental entity and paid from the funds of such entity.
(e) No person other than a duly
licensed cigarette agent (or its employees) may possess in this State
cigarettes upon which the cigarette tax has not been prepaid and precollected
for purposes of making sales to governmental entities. An agent must report all
sales of cigarettes to such entities in its monthly cigarette tax return.
Further, only a United States governmental entity, including voluntary
unincorporated organizations of the armed forces, may possess cigarettes upon
which the tax has not been prepaid and precollected for purposes of reselling
such cigarettes to authorized purchasers.
(f) Governmental entities and authorized
purchasers may purchase cigarettes upon which the seller has not prepaid and
precollected the cigarette tax, only to the extent provided in this section.
The possession within this State at any one time of more than 400 cigarettes in
unstamped (or unlawfully stamped) packages by any governmental entity or
authorized purchaser, except as provided herein, shall be presumptive evidence
that such cigarettes are subject to tax. Such governmental entities and
authorized purchasers who or which purchase cigarettes under any other
circumstances must prepay or pay, as the case may be, the cigarette tax at the
time of purchase be remitting the tax to the seller as part of the purchase
price of the cigarettes.
