Bill Text: NY A05401 | 2021-2022 | General Assembly | Introduced

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Bill Title: Relates to terminal rental adjustment clauses in motor vehicle leases; provides multiple tax payment options for the lessor.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2021-12-10 - approval memo.62 [A05401 Detail]

Download: New_York-2021-A05401-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          5401

                               2021-2022 Regular Sessions

                   IN ASSEMBLY

                                    February 16, 2021
                                       ___________

        Introduced by M. of A. McDONALD -- read once and referred to the Commit-
          tee on Ways and Means

        AN  ACT  to amend the tax law, in relation to terminal rental adjustment
          clauses in motor vehicle leases

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section 1. Paragraph (B) of subdivision (i) of section 1111 of the tax
     2  law, as amended by chapter 20 of the laws of 1992, is amended to read as
     3  follows:
     4    (B)  (1)  Notwithstanding any inconsistent provisions of this subdivi-
     5  sion, with respect to a lease of a motor vehicle described in  paragraph
     6  (A)  of  this  subdivision  for  a  term of one year or more [(1)] which
     7  includes an indeterminate number of options to renew  or  other  similar
     8  contractual  provisions  or  which  includes  thirty-six or more monthly
     9  options to renew beyond the initial term, and [(2)]  under  which  lease
    10  the  lessee of such motor vehicle has certified in the writing described
    11  in clause (i) of subparagraph (C) of paragraph two of subsection (h)  of
    12  section  7701  of  the  internal  revenue code of 1986, under penalty of
    13  perjury, that the lessee intends that more than fifty percent of the use
    14  of such vehicle is to be in a trade  or  business  of  the  lessee,  the
    15  lessor  shall: (i) pay tax on the receipts from the sale of or consider-
    16  ation given or contracted to be given for the purchase, as  measured  by
    17  subdivision  (b)  of  section  eleven  hundred ten of this part, of such
    18  vehicle for lease; or (ii) collect  and  pay  tax  as  measured  by  all
    19  receipts due or consideration given or contracted to be given under such
    20  lease for the first thirty-two months, or the period of the initial term
    21  if  greater,  of  such  lease shall be deemed to have been paid or given
    22  [and shall be subject to tax in accordance with the provisions  of  this
    23  subdivision].
    24    [For]  (2)  If a lessor collects and pays tax as measured under clause
    25  (ii) of subparagraph one of this paragraph,  for  each  such  option  to

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD08089-01-1
        A. 5401                             2

     1  renew, or similar provision, or combination of them, exercised after the
     2  first  thirty-two months, or the period of such initial term, if longer,
     3  of any such lease, tax due under this article  shall  be  collected  and
     4  paid or paid over without regard to this subdivision.
     5    § 2. This act shall take effect immediately.