Current through Register Vol. 46, No. 12, March 20, 2024
(a) When motor fuel is sold at retail, rather
than passing through the prepaid tax to the customer, the seller must collect
the State and local sales taxes based upon the actual selling price of the
motor fuel less the State motor fuel tax imposed by article 12-A and, where
applicable, the New York City tax on leaded gasoline, at the State and local
tax rates in effect where the taxable sale occurs. The price upon which the
retail sales tax is based must not include the prepaid taxes paid on the fuel.
The term retail sales for purposes of motor fuel transactions shall have the
same meaning as contained in section
526.6 of
this Title.
(b) Purchasers of a
large volume of motor fuel shall give the seller a certificate in such form as
the Department of Taxation and Finance may prescribed indicating whether the
fuel is being purchased for resale or purchased at retail for the purchaser's
own use. Where the purchaser of a large volume of motor fuel does not provide
the seller with such a certificate, the seller must determine whether the
prepaid tax which would be due on each gallon of motor fuel if the fuel
purchased for resale or the retail sales tax which would be due on each gallon
of motor fuel if the fuel was purchased at retail is greater. If the prepaid
tax is greater, the seller shall treat the purchase as a purchase for resale,
pass through the prepaid tax and issue a certification of tax payment as
provided in section
561.5
of this Part. If the retail sales tax is greater, the seller shall treat the
purchase as purchase at retail and collect the sales tax. For purposes of this
subdivision, a purchase of a large volume of motor fuel is a purchase of 500
gallons or more.
(c) Exempt sales.
(1) Retail sales of motor fuel to the
following purchasers in the described circumstances are exempt from sales tax:
(i) the United States of America, and any of
its agencies and instrumentalities;
(ii) New York State, or any of its agencies,
instrumentalities, public corporations (including a public corporation created
pursuant to agreement or compact with another state or Canada) or political
subdivisions (including school districts);
(iii) a hospital which holds a current
operating certificate issued by the New York State Department of Health under
section
2805 of the Public Health Law or by the New
York State Department of Mental Hygiene under article 31 of the Mental Hygiene
Law and which qualifies as an exempt organization under section
1116(a)(4) of the Tax
Law;
(iv) an airline, as defined in
section
528.10
of this Title, purchasing kero-jet fuel for use in its own aircraft or for use
in aircraft under its control;
(v)
an Indian nation or tribe listed in section
529.9
of this Title making purchases from a retail service station on its qualified
reservation as defined in section
529.9,
and an individual member of such an Indian nation or tribe residing on such a
qualified reservation making purchases from a retail service station on the
reservation where he resides; and
(vi) diplomatic missions and diplomatic
personnel purchasing motor fuel with credit cards issued by oil companies, as
provided in section
529.5(i)
of this Title.
Only purchasers who fall within the categories listed above
may purchase motor fuel at retail without payment of the sales tax to the
vendor. The other exemptions from sales tax provided for by sections
1115 and
1116 of the Tax Law do not apply to sales
of motor fuel. Although these sales are not exempt under these other exemption
provisions, refunds and credits are allowed. See section
561.10(c)
of this Part.
(2) In order to make retail purchases of
motor fuel without payment of tax, a purchaser listed in paragraph (1) of this
subdivision must furnish to the seller either:
(i) a certificate to the effect that the
purchaser is entitled to acquire motor fuel tax-free pursuant to paragraph (1)
of this subdivision on the form which the Department of Taxation and Finance
has prescribed, signed by the purchaser and setting forth his name and address
together with such other information as said department has required to be
completed therein; or
(ii) a
government purchase order or the appropriate exemption document where the
purchaser is a governmental entity described in subparagraphs (1)(i) and (ii)
of this subdivision.
(3)
Sales of motor fuel at retail--presumptions.
(i) It shall be presumed that all retail
sales of motor fuel are subject to tax until the contrary is established. It
shall be further presumed that all motor fuel imported, caused to be imported,
produced, refined, manufactured, compounded, received or possessed by any
person in this State has been sold subject to tax. This presumption shall not
apply to motor fuel in the fuel tank of a motor vehicle used to propel such
vehicle or to motor fuel in containers of 10 gallons or less.
(ii) The burden of proving that any retail
sale is not subject to the tax shall be upon the purchaser of the motor fuel
and, except as otherwise provided in subparagraph (iv) of this paragraph, shall
also be upon the person required to collect the tax.
(iii) When a vendor makes a sale of motor
fuel which is exempt as provided in paragraph (1) of this subdivision, as proof
of the exemption the vendor shall obtain from the purchaser and retain in his
files either:
(a) a certificate to the effect
that the purchaser is entitled to acquire motor fuel tax-free pursuant to this
subdivision on the form which the Department of Taxation and Finance has
prescribed, signed by the purchaser and setting forth his name and address
together with such other information as said department has required to be
completed therein; or
(b) a
government purchase contract or order or the appropriate exemption document
where the purchaser is a governmental entity described in paragraph (1) of this
subdivision.
(iv) When a
properly completed certificate, government purchase contract or order or
exemption document has been furnished to the vendor and accepted by him in good
faith within 90 days after the delivery of motor fuel, the burden of proving
that the receipts from such sale are not taxable is solely on the
purchaser.
(4) Motor
fuel may be purchased without the payment of sales and use tax only when the
purchasers described in paragraph (1) of this subdivision buy such fuel at
retail for their own use or consumption. When such purchasers buy motor fuel
for resale, the vendor must pass through the tax which has been prepaid on such
fuel.
