Current through Register Vol. 46, No. 12, March 20, 2024
(a)
Definitions.
The definitions in this section shall apply only for the
purpose of the exclusions and the exemptions provided by Tax Law, sections
1105(c)(3)(iv) and 1115(a)(8) with respect to commercial vessels.
(1) Vessel. A vessel shall
mean any type of water craft used for the transportation of property or persons
on water. Marine cargo containers which are constructed for "containerships"
are deemed to be an integral part of such vessel.
(2) Marine cargo container. A
marine
cargo container is an article of transport equipment which is:
(i) fully or partially enclosed to constitute
a compartment intended for containing goods;
(ii) of a permanent character and accordingly
strong enough to be suitable for repeated use;
(iii) specially designed to facilitate the
carriage of goods, by one or more modes of transport, without intermediate
reloading;
(iv) designed for ready
handling, particularly when being transferred from one mode of transport to
another;
(v) designed to be easy to
fill and to empty; and
(vi) having
an integral volume of one cubic meter or more.
The term marine cargo container shall
include the accessories and equipment of the container, appropriate for the
type concerned, provided that such accessories and equipment are carried with
the container. The term marine cargo container shall not include vehicles,
accessories or spare parts of vehicles, or packaging.
(3) Commercial vessel. A
Commercial vessel is any vessel used or engaged in the
transportation for hire of persons or property on water. Any vessel used or
engaged for other purposes on more than an occasional basis is not a commercial
vessel.
(4) Commercial vessel
primarily engaged in interstate or foreign commerce. A commercial vessel
primarily engaged in interstate or foreign commerce when 50 percent or more of
the receipts from the vessel's activities are derived from interstate or
foreign commerce.
(5) Interstate or
foreign commerce. Interstate or foreign commerce means the
transportation of persons or property between states or countries.
(b)
Exemption.
(1) Receipts from the sale of the following
are exempt from the sales and compensating use tax:
(i) commercial vessels primarily engaged in
interstate or foreign commerce;
(ii) property used by or purchased for the
use of such vessels for fuel, provisions, supplies, maintenance and repairs;
and
(iii) the services of
installing, maintaining, servicing or repairing such commercial vessels or
property. (See section
527.5
of this Title, installing, maintaining, servicing and repairing tangible
personal property.)
(2)
The exemption from the sales and use tax does not apply to:
(i) property purchased for or used in the
original equipping of a new ship; or
(ii) the services of installing such property
in the equipping of a new ship.
(c)
Property used by or purchased for
the use of commercial vessels.
The following are examples of property used by or purchased
for the use of commercial vessels:
(1)
Sea stores includes all articles, supplies and provisions
taken on board a vessel, necessary for the sustenance and maintenance of its
passengers and crew during a voyage. Some specific sea stores are:
foods
medicines
soap
toilet articles
rubber boots
uniforms
paper towels
toilet tissue
tooth paste
razor blades
overalls
rain and foul weather gear
(2)
Ships stores includes
all articles, materials or supplies taken aboard a vessel, necessary and used
for the maintenance of the ship during a voyage. Some specific ships stores
are:
bolts
nuts
nails
grease
oil
spare parts
paints
varnishes
paint brushes
hand tools
(3)
Ships equipment includes
all articles which are necessary for navigation or operation of the vessel or
for the safety or accommodation of persons or cargo aboard. Some specific ships
equipment is:
anchors
chains
lines
cables
rigging
sails
lifeboats
wireless equipment
search lights
furniture
carpet
china
urinals
lamps
glassware
tableware
fixtures
ballast
lifesaving apparatus
bathtubs
tackles
winches
nautical instruments
signal lights
tableware
kitchen utensils
table utensils
bedding
sheets and blankets
towels
cabin furniture
electric lightbulbs
flexible metal hose
(See subparagraph [b][2][i] of this
section.)
(d)
Services performed on or for commercial vessels.
The following are some of the services performed on or for
commercial vessels.
(1) Services exempt
from the sales tax includes the maintenance or repair of the vessel itself or
components of the vessel and the installation or servicing of replacement
equipment on vessels. Some of the exempt services are:
painting
hull cleaning
carpentry
hold cleaning
ship sealing
repair and maintenance of:
radar
navigational aids
on-board cargo handling equipment
marine cargo containers
canvas
office equipment
(2) Some of the services not subject to tax
are:
stevedoring
cargo weighing
piloting
clerking and checking during cargo
handling
(3) Tug boat
services are considered to be exempt transporting services.
(4) The following are taxable:
(i) trash and garbage removal from the pier
or docking area;
(ii) the purchase
or rental of tangible personal property for the performance of stevedoring
services; and
(iii) the purchase of
on-dock gas, electric and telephone services, except out-of-state telephone
calls.
