N.Y. Tax Law § 1103 — Prepayment of sales tax on cigarettes

§ 1103. Prepayment of sales tax on cigarettes. (a)(1) Every cigarette\nagent shall pay, as a prepayment on account of the taxes imposed by this\narticle and pursuant to the authority of article twenty-nine of this\nchapter, a tax on cigarettes possessed for sale or use in this state and\nto which an agent is required to affix cigarette tax stamps under\narticle twenty of this chapter, at the time that the agent is required\nto purchase and affix such stamps (or as otherwise prescribed by the\ncommissioner pursuant to such article twenty) and the provisions of such\narticle twenty in relation to the use of stamps to evidence payment of\nthe tax imposed by such article twenty shall be applicable to the\nprepayment imposed by this section, except no tax shall be required to\nbe prepaid on cigarettes sold under circumstances that this state is\nwithout power to impose such prepayment or sold to the United States or\nsold to or by a voluntary unincorporated organization of the armed\nforces of the United States operating a place for the sale of goods\npursuant to regulations promulgated by the appropriate executive agency\nof the United States, to the extent provided in such regulations and\nwritten policy statements of such an agency applicable to such sales.\n (2) The tax imposed by this section shall be paid at the same time and\nin the same manner as the tax imposed by such article twenty with\nrespect to cigarettes. The commissioner may, in the commissioner's\ndiscretion, permit an agent to pay the tax imposed under this section at\nthe same time that the agent pays for cigarette tax stamps under article\ntwenty of this chapter and may require any such agent to file with the\ndepartment a bond issued by a surety company approved by the\nsuperintendent of financial services as to solvency and responsibility\nand authorized to transact business in the state or other security\nacceptable to the commissioner, in such amount as the commissioner may\nfix, to secure the payment of any sums due from such agent pursuant to\nthis section. If securities are deposited as security under this\nsubdivision, such securities shall be kept in the custody of the\ncommissioner and may be sold by the commissioner if it becomes necessary\nto do so in order to recover any sums due from such agent pursuant to\nthis section, but no such sale shall be had until after such agent shall\nhave had an opportunity to litigate the validity of any prepayment of\ntax if it elects to do so. Upon any such sale, the surplus, if any,\nabove the sums due under this section shall be returned to such agent.\nAny bond or security required under this section may be jointly\nadministered with the bond or security required of the agent under\nsection four hundred seventy-two of this chapter and in such event shall\nsecure payment of the sums due under such article twenty and under this\nsection. The tax imposed by this section and the portion of the cost of\nany stamp which evidences payment of the tax imposed by this section and\nwhich is attributable to the tax imposed by this section shall not be\nincluded in the term "basic cost of cigarettes" as such term is defined\nin section four hundred eighty-three of this chapter.\n (3) Every person other than an agent shall prepay the tax imposed by\nthis section at the same time and in the same manner as the use tax\nimposed by section four hundred seventy-one-a of this chapter. The\ncommissioner may require any compensating use tax imposed by section\neleven hundred ten and pursuant to the authority of article twenty-nine\nof this chapter to be paid at such time after allowing for the credit\nprovided by subdivision (b) of section eleven hundred twenty-one of this\narticle.\n (4) The amount of the prepayment for cigarettes imposed by this\nsection shall be computed pursuant to the provisions of subdivision (j)\nof section eleven hundred eleven of this article.\n (b) Except as otherwise provided in this section, the taxes required\nto be prepaid pursuant to this section shall be administered and\ncollected in a like manner as the taxes imposed by sections eleven\nhundred five and eleven hundred ten of this article. All the provisions\nof this article relating to or applicable to the administration,\ncollection and disposition of the taxes imposed by such sections shall\napply to the tax required to be prepaid under this section so far as\nsuch provisions can be made applicable to such prepayments of tax with\nsuch limitations as set forth in this article and such modifications as\nmay be necessary in order to adapt such language to the tax so imposed;\nprovided, however, that the provisions of paragraph one of subdivision\n(c) of section eleven hundred thirty-seven of this article shall not be\napplicable to such tax required to be prepaid under this section. Such\nprovisions shall apply with the same force and effect as if the language\nof those provisions had been set forth in full in this section except to\nthe extent that any provision is either inconsistent with a provision of\nthis section or is not relevant to the tax required to be prepaid by\nthis section. For purposes of this section, any reference in this\narticle to the tax or taxes imposed by this article shall be deemed to\nrefer to the tax required to be prepaid pursuant to this section unless\na different meaning is clearly required.\n (c) Nothing in this article shall be construed to require the payment\nof the tax required to be prepaid pursuant to this section more than\nonce upon cigarettes possessed for sale or used within the state. When\nthe prepaid tax imposed pursuant to this section is paid, it shall have\nbeen so paid on account of the taxes imposed by this article and\npursuant to the authority of article twenty-nine of this chapter with\nrespect to the retail sale or the use of cigarettes. Nothing in this\nsection shall modify or affect the taxes imposed by sections eleven\nhundred five and eleven hundred ten of this article as applied to\nreceipts from the sale, or to the use, of such cigarettes.\n (d) Deposit and disposition of revenue. (1) Consistent with sections\neleven hundred forty-eight of this article and twelve hundred sixty-one\nof this chapter, the taxes required to be prepaid pursuant to this\nsection and interest and penalties thereon received by the commissioner,\nafter deducting the amount which the commissioner shall determine to be\nnecessary for reasonable costs of the commissioner in administering,\ncollecting, and distributing such taxes, shall be deposited daily with\nsuch responsible banks, banking houses or trust companies, as may be\ndesignated by the comptroller, to the credit of the comptroller. Of the\ntotal revenue collected or received under this section, the comptroller\nshall retain in the comptroller's hands such amount as the commissioner\nmay determine to be necessary for refunds under this article and\npursuant to the authority of article twenty-nine of this chapter.\n (2) On or before the twelfth day of each month, after reserving such\namount for such refunds and such costs, the commissioner shall determine\nthe amount of all revenues so received during the prior month as a\nresult of the taxes, interest and penalties so imposed and, in addition,\non or before the last day of June and December the commissioner shall\ndetermine in like manner the amount of such moneys received during and\nincluding the first twenty-five days of said months. The commissioner\nshall determine the proportion of revenues attributable to receipts for\nthe period for which the determination is made pursuant to the preceding\nsentence from taxes on sales and uses of property and services and rent\nand amusement charges imposed by this article and pursuant to the\nauthority of article twenty-nine of this chapter and administered by the\ncommissioner which is payable to each jurisdiction determined without\nregard to this section. The amount of revenues so determined pursuant to\nthis section shall be deposited and distributed by the comptroller in\naccordance with the same percentage amount to which a jurisdiction is\nentitled determined without regard to this section. Where the amount so\ndetermined in any distribution from such taxes (other than the tax\nimposed by this section) is more or less than the amount due, the amount\nof the overpayment or underpayment shall be determined as soon after the\ndiscovery of the overpayment or underpayment as is reasonably possible\nand subsequent determinations shall be adjusted by subtracting the\namount of any such overpayment from or by adding the amount of any such\nunderpayment to such number of subsequent payments as the comptroller\nand the commissioner shall consider reasonable in view of the amount of\nthe overpayment or underpayment and all other pertinent facts and\ncircumstances. The commissioner shall not be liable for any overestimate\nor underestimate of the amount of the distribution. Nor shall the\ncommissioner be liable for any inaccuracy in any determination with\nrespect to the amount of the distribution or any required adjustment\nwith respect to the distribution, but the commissioner shall as soon as\npracticable after discovery of any error adjust the next determination\nunder this section to reflect any such error.\n