Bill Text: NY S02830 | 2021-2022 | General Assembly | Introduced


Bill Title: Establishes the NYC under 3 act to impose a payroll tax on certain employers in the city of New York for the purposes of addressing child care affordability, accessibility, and quality for families with children under three years of age.

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Introduced - Dead) 2022-01-05 - REFERRED TO BUDGET AND REVENUE [S02830 Detail]

Download: New_York-2021-S02830-Introduced.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                          2830

                               2021-2022 Regular Sessions

                    IN SENATE

                                    January 25, 2021
                                       ___________

        Introduced by Sens. RAMOS, GOUNARDES, HOYLMAN, SALAZAR -- read twice and
          ordered  printed, and when printed to be committed to the Committee on
          Budget and Revenue

        AN ACT to amend the tax law, in relation to establishing the NYC under 3
          act

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

     1    Section  1. This act shall be known and may be cited as the "NYC under
     2  3 act".
     3    § 2. The tax law is amended by adding a new article 24-A  to  read  as
     4  follows:
     5                                ARTICLE 24-A
     6                               NYC UNDER 3 ACT
     7  Section 860. Definitions.
     8          861. Imposition of tax and rate.
     9          862. Pass through of tax prohibited.
    10          863. Exemption override.
    11          864. Payment of tax.
    12          865. Deposit and disposition of revenue.
    13          866. Procedural provisions.
    14          867. Enforcement with other taxes.
    15    § 860. Definitions. For the purposes of this article:
    16    (a)  Employer.  Employer  means  an  employer  required by section six
    17  hundred seventy-one of this chapter to  deduct  and  withhold  tax  from
    18  wages,  that  has a payroll expense in excess of six hundred twenty-five
    19  thousand dollars in any calendar quarter; other than:
    20    (1) any agency or instrumentality of the United States;
    21    (2) the United Nations;
    22    (3) an interstate agency or public corporation created pursuant to  an
    23  agreement or compact with another state or the Dominion of Canada; or

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD06656-01-1

        S. 2830                             2

     1    (4)  (i)  any  non-profit  early  childhood  services  provider  which
     2  receives funding from the federal or state government, or any municipal,
     3  state or federal agency, or political subdivision.
     4    (ii)  As  used  in  this  section, the term "early childhood services"
     5  shall mean services which include, but are not limited  to,  registered,
     6  certified  or  licensed  care in family day care homes; group family day
     7  care homes; school-age child care programs;  head  start  programs;  day
     8  care centers; child care which may be provided without a permit, certif-
     9  icate  or  registration in accordance with this statute; early childhood
    10  education programs approved by the state education department; and  care
    11  provided  in a children's camp as defined in section fourteen hundred of
    12  the public health law.
    13    (b) Payroll expense. Payroll expense means wages and  compensation  as
    14  defined  in sections 3121 and 3231 of the internal revenue code (without
    15  regard to section 3121(a)(1) and section 3231(e)(2)(A)(i)), paid to  all
    16  covered employees.
    17    (c)  Covered  employee.  Covered  employee  means  an  employee who is
    18  employed in a city with a population of one million or more.
    19    § 861. Imposition of tax and rate.  For the purpose  of  providing  an
    20  additional stable and reliable dedicated funding source to address child
    21  care  affordability,  accessibility, and quality for families with chil-
    22  dren under three years of age in a city with a population of one million
    23  or more, a tax  is  hereby  imposed  on  employers  and  individuals  as
    24  follows:  For  employers  who  engage in business in a city with a popu-
    25  lation of one million or more, the tax is  imposed  at  a  rate  of  (a)
    26  fifteen  hundredths  (.15)  percent of the payroll expense for employers
    27  with payroll expense in  excess  of  six  hundred  twenty-five  thousand
    28  dollars and not more than one million two hundred fifty thousand dollars
    29  per  calendar  quarter,  (b)  eighteen  hundredths  (.18) percent of the
    30  payroll expense for employers with payroll  expense  in  excess  of  one
    31  million two hundred fifty thousand dollars and not more than two million
    32  five  hundred  thousand dollars per calendar quarter, and (c) twenty-two
    33  hundredths (.22) percent of  the  payroll  expense  for  employers  with
    34  payroll  expense  in excess of two million five hundred thousand dollars
    35  per calendar quarter.  If the employer is a professional employer organ-
    36  ization, as defined in section nine hundred sixteen of  the  labor  law,
    37  the  employer's  tax  shall  be  calculated  by  determining the payroll
    38  expense attributable to each client who has entered into a  professional
    39  employer  agreement  with  such  organization  and  the  payroll expense
    40  attributable to such organization  itself,  multiplying  each  of  those
    41  payroll  expense  amounts by the applicable rate set forth in this para-
    42  graph and adding those products together.
    43    § 862. Pass through of tax prohibited. An employer cannot deduct  from
    44  the  wages or compensation of an employee any amount that represents all
    45  or any portion of the tax imposed on the employer under this article.
    46    § 863. Exemption override. (a) Except as provided in subsection (b) of
    47  this section, any exemption from tax specified in  any  other  New  York
    48  state law will not apply to the tax imposed by this article.
    49    (b) If a tax-free NY area approved pursuant to the provisions of arti-
    50  cle  twenty-one of the economic development law is located within a city
    51  with a population of one million or more, the payroll  expense  in  such
    52  tax-free  NY  area  of  any  employer  that  is located in such area and
    53  accepted into the START-UP NY program  shall  be  exempt  from  the  tax
    54  imposed under this article.
    55    § 864. Payment of tax. Employers with payroll expense. The tax imposed
    56  on  the  payroll expense of employers under section eight hundred sixty-

        S. 2830                             3

     1  one of this article must be paid  at  the  same  time  the  employer  is
     2  required  to  remit  payments  under section six hundred seventy-four of
     3  this chapter; provided however, that employers subject to the provisions
     4  in  section nine of this chapter must pay the tax on the payroll expense
     5  at the same time as the withholding tax remitted  under  the  electronic
     6  payment  reporting  system  and  the  electronic  funds  transfer system
     7  authorized by section nine of this chapter.
     8    § 865. Deposit and disposition of revenue. (a)  The  taxes,  interest,
     9  and  penalties  imposed by this article and collected or received by the
    10  commissioner shall be deposited daily with such responsible banks, bank-
    11  ing houses or trust companies, as may be designated by  the  comptroller
    12  of  the city of New York, to the credit of such comptroller in trust for
    13  the city of New York.  Such deposits shall be kept  separate  and  apart
    14  from all other money in the possession of the comptroller of the city of
    15  New York. The comptroller of the city of New York shall require adequate
    16  security  from all such depositories.  Of the total revenue collected or
    17  received under this article, the comptroller of the  city  of  New  York
    18  shall  retain such amount as the commissioner may determine to be neces-
    19  sary for refunds under this article. The comptroller of the city of  New
    20  York  is  authorized and directed to deduct from the amounts it receives
    21  under this article, before deposit into the trust accounts designated by
    22  such comptroller, a reasonable amount necessary to effectuate refunds of
    23  the department to reimburse the department for  the  costs  incurred  to
    24  administer, collect and distribute the taxes imposed by this article.
    25    (b)  After  reserving  such amount for such refunds and deducting such
    26  amounts for such costs, as  provided  for  in  subsection  (a)  of  this
    27  section,  the  commissioner shall certify to the comptroller of the city
    28  of New York the amount of all revenues  so  received  during  the  prior
    29  month  as  a result of the taxes, interest and penalties so imposed. The
    30  amount of revenues so certified shall be paid over by the fifteenth  and
    31  the  final business day of each succeeding month from such account with-
    32  out appropriation into the general fund of the city of New York.
    33    § 866. Procedural provisions. (a) General. All provisions  of  article
    34  twenty-two of this chapter shall apply to the provisions of this article
    35  in the same manner and with the same force and effect as if the language
    36  of article twenty-two of this chapter had been incorporated in full into
    37  this  article  and  had  been  specifically  adjusted  for and expressly
    38  referred to the tax imposed by this article, except to the  extent  that
    39  any provision is either inconsistent with a provision of this article or
    40  is not relevant to this article. Notwithstanding the preceding sentence,
    41  no  credit against tax in article twenty-two of this chapter can be used
    42  to offset the tax due under this article.
    43    (b) Combined filings. Notwithstanding any  other  provisions  of  this
    44  article:
    45    (1) The commissioner may require the filing of a combined return which
    46  may  also  include any of the returns required to be filed by a taxpayer
    47  pursuant to the provisions of section  six  hundred  fifty-one  of  this
    48  chapter  and which may be required to be filed by such taxpayer pursuant
    49  to any local law enacted pursuant to the authority  of  article  thirty,
    50  thirty-A or thirty-B of this chapter.
    51    (2)  Where  a  combined  return  is  required, and with respect to the
    52  payment of estimated tax, the commissioner may also require the  payment
    53  to  it  of  a  single  amount which shall equal the total of the amounts
    54  (total taxes less any credits or refunds) which would have been required
    55  to be paid with the returns or in payment of estimated tax  pursuant  to
    56  the  provisions of this article, the provisions of article twenty-two of

        S. 2830                             4

     1  this chapter, and the provisions of local laws enacted under the author-
     2  ity of article thirty, thirty-A or thirty-B of this chapter.
     3    (3)  Notwithstanding  any  other law to the contrary, the commissioner
     4  may require that all filings of forms  or  returns  under  this  article
     5  shall be filed electronically and all payments of tax must be paid elec-
     6  tronically.
     7    § 867. Enforcement with other taxes. (a) Joint assessment. If there is
     8  assessed  a  tax  under  this  article  and there is also assessed a tax
     9  against the same taxpayer pursuant to article twenty-two of this chapter
    10  or under a local law enacted pursuant to the authority of article  thir-
    11  ty,  thirty-A,  or  thirty-B  of  this  chapter, and payment of a single
    12  amount is required under the provisions of this  article,  such  payment
    13  shall  be deemed to have been made with respect to the taxes so assessed
    14  in proportion to the amounts of such taxes due,  including  tax,  penal-
    15  ties, interest and additions to tax.
    16    (b)  Joint action. If the commissioner takes action under such article
    17  twenty-two or under a local law enacted pursuant  to  the  authority  of
    18  article  thirty,  thirty-A,  or thirty-B of this chapter with respect to
    19  the enforcement and collection of the tax or taxes assessed  under  such
    20  articles,  the  commissioner  shall,  whenever  possible  and necessary,
    21  accompany such action with a similar action  under  similar  enforcement
    22  and collection provisions of the tax imposed by this article.
    23    (c)  Apportionment  of  moneys  collected  by joint action. Any moneys
    24  collected as a result of such joint action shall be deemed to have  been
    25  collected  in  proportion  to the amounts due, including tax, penalties,
    26  interest and additions to tax, under article twenty-two of this  chapter
    27  or  under a local law enacted pursuant to the authority of article thir-
    28  ty, thirty-A, or thirty-B of this chapter and the tax  imposed  by  this
    29  article.
    30    (d)  Joint  deficiency  action.  Whenever  the  commissioner takes any
    31  action with respect to a deficiency of income tax under article  twenty-
    32  two of this chapter or under a local law enacted pursuant to the author-
    33  ity of article thirty, thirty-A, or thirty-B of this chapter, other than
    34  the action set forth in subsection (a) of this section, the commissioner
    35  may in his or her discretion accompany such action with a similar action
    36  under this article.
    37    § 3. This act shall take effect immediately.
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