Bill Text: NY A04619 | 2025-2026 | General Assembly | Introduced
Bill Title: Relates to the taxation of vapor products; provides for the licensing of vapor products distributors; imposes certain tax return filing requirements on vapor products distributors; provides for enforcement powers.
Spectrum: Partisan Bill (Democrat 24-0)
Status: (Introduced) 2025-02-04 - referred to ways and means [A04619 Detail]
Download: New_York-2025-A04619-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 4619 2025-2026 Regular Sessions IN ASSEMBLY February 4, 2025 ___________ Introduced by M. of A. SOLAGES, ZACCARO, TAYLOR, LUPARDO, HEVESI, SHIM- SKY, JONES, LEVENBERG, STECK, BURDICK, STIRPE, DINOWITZ, RIVERA, WILLIAMS, BENEDETTO, DILAN, CRUZ, MAGNARELLI, DAVILA -- read once and referred to the Committee on Ways and Means AN ACT to amend the tax law, in relation to the taxation of vapor products The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 1180 of the tax law is amended by adding five new 2 subdivisions (c), (d), (e), (f), and (g) to read as follows: 3 (c) "Flavored nicotine analogue product" means a flavored vapor prod- 4 uct that contains a nicotine analogue. 5 (d) "Flavored vapor product" shall have the same meaning as described 6 in section thirteen hundred ninety-nine-mm-1 of the public health law. 7 (e) "Nicotine analogue" means a substance: 8 (1) (A) The chemical structure of which is substantially similar to 9 the chemical structure of nicotine; or 10 (B) Which has, purports to have, or is represented to have, an effect 11 on the central nervous system that is similar to or greater than effect 12 on the central nervous system of nicotine. 13 (2) Factors relevant to determining whether a substance is a nicotine 14 analogue include, but are not limited to, the marketing, advertising and 15 labeling of the substance, and whether the substance has been manufac- 16 tured, formulated, sold, distributed, or marketed with the intent to 17 avoid the provisions of this subdivision and other applicable provisions 18 of law. 19 (f) "Vapor products distributor" means any person who imports or caus- 20 es to be imported into this state any vapor products for sale, or who 21 manufactures any vapor product in this state, and any person within or 22 without the state who is authorized by the commissioner to make returns EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD06080-03-5A. 4619 2 1 and pay the tax on vapor products sold, shipped, or delivered by such 2 person to any person in the state. 3 (g) "Wholesale price" means the price at which a vapor products dealer 4 purchases vapor products from a vapor products distributor. 5 § 2. Section 1181 of the tax law, as amended by chapter 92 of the laws 6 of 2021, is amended to read as follows: 7 § 1181. Imposition of tax. (a) In addition to any other tax imposed 8 by this chapter or other law, there is hereby imposed a tax of twenty 9 percent on [receipts from the retail sale of vapor products sold] the 10 wholesale price of vapor products sold by a vapor products distributor 11 to a vapor products dealer in this state. The tax is imposed on the 12 [purchaser] vapor products dealer and collected by the vapor products 13 [dealer as defined in subdivision (b) of section eleven hundred eighty14of this article] distributor, in trust for and on account of the state. 15 The taxes imposed under this section shall not apply to adult-use canna- 16 bis products subject to tax under article twenty-C of this chapter. 17 (b) The vapor products distributor shall be liable for the payment of 18 the tax on vapor products which the vapor products distributor imports 19 or causes to be imported into the state, or which the vapor products 20 distributor manufactures in the state, and every vapor products distrib- 21 utor authorized by the commissioner to make returns and pay the tax on 22 tobacco products sold, shipped or delivered by the vapor products 23 distributor to any person in the state shall be liable for the payment 24 of the tax on all vapor products so sold, shipped or delivered. 25 (c) Every vapor products dealer shall be liable for the tax on all 26 vapor products in the vapor products distributor's possession at any 27 time, upon which tax has not been paid or assumed by a vapor products 28 distributor appointed by the commissioner, and the failure of any vapor 29 products dealer to produce and exhibit to the commissioner or the 30 commissioner's authorized representative upon demand, an invoice by a 31 vapor products distributor for any vapor products in the vapor products 32 distributor's possession shall be presumptive evidence that the tax 33 thereon has not been paid, and that such dealer is liable for the tax 34 thereon unless evidence of such invoice, payment or assumption shall 35 later be produced. 36 § 3. The tax law is amended by adding two new sections 1183-a and 37 1183-b to read as follows: 38 § 1183-a. Vapor products distributor license and renewal. (a) Every 39 person who intends to be a vapor products distributor in this state must 40 receive from the commissioner a license prior to engaging in business. 41 In addition to the requirements of section eleven hundred eighty-three 42 of this article, a vapor products dealer who purchases or receives vapor 43 products from a manufacturer or out-of-state distributor shall be 44 required to obtain a vapor products distributor license. The applicant 45 for a vapor products distributor license must electronically submit a 46 properly completed application for a license for each location at which 47 the business shall be conducted in this state, on a form prescribed by 48 the commissioner, and shall be accompanied by a non-refundable applica- 49 tion fee of three hundred dollars. 50 (b) A vapor products distributor license shall be valid for the calen- 51 dar year for which it is issued unless earlier suspended or revoked. 52 Upon the expiration of the term stated on the license, such license 53 shall be null and void. A license shall not be assignable or transfera- 54 ble and shall be destroyed immediately upon the vapor products distribu- 55 tor ceasing to do business as specified in such license or in the event 56 that such business never commenced.A. 4619 3 1 (c) Every vapor products distributor shall publicly display in the 2 vapor products distributor's place of business a license from the 3 department. 4 (d) (1) The commissioner shall refuse to issue a license to any appli- 5 cant who does not possess a valid certificate of authority under section 6 eleven hundred thirty-four of this chapter. In addition, the commission- 7 er may refuse to issue a license, or suspend, cancel or revoke a license 8 issued to any person who: 9 (A) has a past-due liability as that term is defined in section one 10 hundred seventy-one-v of this chapter; 11 (B) has had a license under this article or any license or registra- 12 tion provided for in this chapter revoked within one year from the date 13 on which such application was filed; 14 (C) has been convicted of a crime provided for in this chapter within 15 one year from the date on which such application was filed; 16 (D) willfully fails to file a report or return required by this arti- 17 cle; 18 (E) willfully files, causes to be filed, gives or causes to be given a 19 report, return, certificate or affidavit required by this article which 20 is false; 21 (F) willfully fails to collect or truthfully account for or pay over 22 any tax imposed by this article; or 23 (G) whose place of business is at the same premises as that of a 24 person whose vapor products distributor license has been revoked and 25 where such revocation is still in effect, unless the applicant or vapor 26 products distributor provides the commissioner with adequate documenta- 27 tion demonstrating that such applicant or vapor products distributor 28 acquired the premises or business through an arm's length transaction as 29 defined in paragraph (e) of subdivision one of section four hundred 30 eighty-a of this chapter. 31 (2) In addition to the grounds provided in paragraph one of this 32 subdivision, the commissioner shall refuse to issue a license and shall 33 cancel or suspend a license as directed by an enforcement officer pursu- 34 ant to article thirteen-F of the public health law. Notwithstanding any 35 provision of law to the contrary, an applicant whose application for a 36 license is refused or a vapor products distributor whose license is 37 cancelled or suspended under this paragraph shall have no right to a 38 hearing under this chapter and shall have no right to commence a court 39 action or proceeding or to any other legal recourse against the commis- 40 sioner with respect to such refusal, suspension or cancellation; 41 provided, however, that nothing herein shall be construed to deny a 42 vapor products distributor a hearing under article thirteen-F of the 43 public health law or to prohibit vapor products distributors from 44 commencing a court action or proceeding against an enforcement officer 45 as defined in section thirteen hundred ninety-nine-aa of the public 46 health law. 47 (e) If a vapor products distributor license is suspended, cancelled or 48 revoked and such vapor products distributor distributes or sells vapor 49 products through more than one place of business in this state, the 50 vapor products distributor's license issued to that place of business 51 where such violation occurred shall be suspended, revoked, or cancelled. 52 Provided, however, upon a vapor products distributor's third suspension, 53 cancellation, or revocation within a five-year period for any one or 54 more businesses owned or operated by the vapor products distributor, 55 such suspension, cancellation, or revocation of the vapor products 56 distributor's license shall apply to all places of business where theA. 4619 4 1 vapor products distributor distributes or sells vapor products in this 2 state. 3 (f) Every holder of a license must notify the commissioner of changes 4 to any of the information stated on the license or changes to any infor- 5 mation contained in the application for the license. Such notification 6 must be made on or before the last day of the month in which a change 7 occurs and must be made electronically on a form prescribed by the 8 commissioner. 9 (g) Every vapor products distributor who holds a license under this 10 article shall be required to reapply for a license for the following 11 calendar year on or before the twentieth day of September and such reap- 12 plication shall be subject to the same requirements and conditions, 13 including grounds for refusal, as an initial license under this article, 14 including but not limited to the payment of the three hundred dollar 15 application fee for each business location. 16 (h) In addition to any other penalty imposed by this chapter, any 17 vapor products distributor who violates the provisions of this section, 18 (1) for a first violation is liable for a civil fine not less than five 19 thousand dollars but not to exceed twenty-five thousand dollars and such 20 license may be suspended for a period of not more than six months; and 21 (2) for a second or subsequent violation within three years following a 22 prior violation of this section, is liable for a civil fine not less 23 than ten thousand dollars but not to exceed thirty-five thousand dollars 24 and such license may be suspended for a period of up to thirty-six 25 months; or (3) for a third violation within a period of five years, the 26 license issued to each place of business owned or operated by the vapor 27 products distributor in this state shall be revoked for a period of up 28 to five years. 29 § 1183-b. Restrictions on sale. No person, including a vapor products 30 dealer or any agent or employee of a vapor products dealer, shall sell 31 or offer for sale at retail in the state or to any person in the state 32 any flavored nicotine analogue product. 33 § 4. Section 1184 of the tax law, as added by section 1 of part UU of 34 chapter 59 of the laws of 2019, is amended to read as follows: 35 § 1184. Administrative provisions. (a) [Except as otherwise provided36for in this article, the taxes imposed by this article shall be adminis-37tered and collected in a like manner as and jointly with the taxes38imposed by sections eleven hundred five and eleven hundred ten of this39chapter. In addition, except as otherwise provided in this article, all40of the provisions of article twenty-eight of this chapter (except41sections eleven hundred seven, eleven hundred eight, eleven hundred42nine, and eleven hundred forty-eight) relating to or applicable to the43administration, collection and review of the taxes imposed by such44sections eleven hundred five and eleven hundred ten, including, but not45limited to, the provisions relating to definitions, returns, exemptions,46penalties, tax secrecy, personal liability for the tax, and collection47of tax from the customer, shall apply to the taxes imposed by this arti-48cle so far as such provisions can be made applicable to the taxes49imposed by this article with such limitations as set forth in this arti-50cle and such modifications as may be necessary in order to adapt such51language to the taxes so imposed. Such provisions shall apply with the52same force and effect as if the language of those provisions had been53set forth in full in this article except to the extent that any54provision is either inconsistent with a provision of this article or is55not relevant to the taxes imposed by this article.A. 4619 5 1(b) Notwithstanding the provisions of subdivision (a) of this section,2the exemptions provided in paragraph ten of subdivision (a) of section3eleven hundred fifteen of this chapter, and the provisions of section4eleven hundred sixteen, except those provided in paragraphs one, two,5three and six of subdivision (a) of such section, shall not apply to the6taxes imposed by this article.] Every vapor products distributor author- 7 ized by the commissioner to make returns and pay the tax on vapor 8 products sold, shipped, or delivered by the vapor products distributor 9 to a person in the state shall file a return showing the quantity and 10 wholesale price of all vapor products so sold, shipped, or delivered 11 during the preceding calendar month. Provided, however, the commissioner 12 may, if the commissioner deems it necessary in order to ensure the 13 payment of the taxes imposed by this article, require returns to be made 14 at such times and covering such periods as the commissioner may deem 15 necessary, and, by regulation, may permit the filing of returns on a 16 quarterly, semi-annual or annual basis, or may waive the filing of 17 returns by a vapor products distributor for such time and upon such 18 terms as the commissioner may deem proper if satisfied that no tax 19 imposed by this article is or will be payable during the time for which 20 returns are waived. Such returns shall contain such further information 21 as the commissioner may require. 22 (b) Every vapor product distributor shall pay to the commissioner with 23 the filing of such return the tax on vapor products for such month 24 imposed under this article, less two percent, to cover the distributor's 25 expense in the collection and remittance of the said tax. 26 (c) Notwithstanding the provisions of this section or section eleven 27 hundred forty-six of this chapter, the commissioner may, in [his or her] 28 the commissioner's discretion, permit the commissioner of health or [his29or her] such commissioner's authorized representative to inspect any 30 return related to the tax imposed by this article and may furnish to the 31 commissioner of health any such return or supply [him or her] such 32 commissioner with information concerning an item contained in any such 33 return, or disclosed by any investigation of a liability under this 34 article. 35 § 5. The tax law is amended by adding two new sections 1184-a and 36 1184-b to read as follows: 37 § 1184-a. Enforcement. (a) The commissioner or the commissioner's duly 38 authorized representatives are hereby authorized: 39 (1) To enforce the provisions in this article and the provisions in 40 section thirteen hundred ninety-nine-mm-1 of the public health law 41 concerning flavored vapor products. 42 (2) To conduct regulatory inspections during normal business hours of 43 any place of business, including a vehicle used for such business, where 44 vapor products are distributed, placed, stored, sold, or offered for 45 sale. For the purposes of this section, "place of business" shall not 46 include a residence or other real property, or any personal vehicle on 47 or about such property, not held out as open to the public or otherwise 48 being utilized in a business or commercial manner, unless probable cause 49 exists to believe that such residence, real property or vehicle is being 50 used in such a business or commercial manner for the buying or selling 51 of vapor products. 52 (3) To examine any vapor products and the books, papers, invoices, and 53 other records of any place of business or vehicle where vapor products 54 are distributed, placed, stored, sold or offered for sale. Any person in 55 possession, control or occupancy of any such business is required to 56 give to the commissioner or the commissioner's duly authorized represen-A. 4619 6 1 tatives, the means, facilities, and opportunity for such examinations. 2 For the purposes of this section, "place of business" shall not include 3 a residence or other real property, or any personal vehicle on or about 4 such property, not held out as open to the public or otherwise being 5 utilized in a business or commercial manner, unless probable cause 6 exists to believe that such residence, real property or vehicle is being 7 used in such a business or commercial manner for the buying or selling 8 of vapor products. 9 (b) If any person registered or who has obtained a license under this 10 article, or their agents, refuses to give the commissioner, or the 11 commissioner's duly authorized representatives, the means, facilities 12 and opportunity for the inspections and examinations required by this 13 section, the commissioner, after notice and an opportunity for a hear- 14 ing, may revoke their license to distribute vapor products or to sell 15 vapor products at retail: 16 (1) for a period of one year for the first such failure; 17 (2) for a period of up to three years for a second such failure within 18 a period of three years; and 19 (3) for a period of up to seven years for a third such failure within 20 five years. 21 (c) The commissioner or the commissioner's duly authorized represen- 22 tatives shall seize any non-tax-paid vapor products, flavored vapor 23 products, or flavored nicotine analogue products found in any place of 24 business or vehicle where vapor products are distributed, placed, 25 stored, sold or offered for sale by any person who does not possess a 26 license as described in section eleven hundred eighty-three-a of this 27 article. 28 (d) All non-tax-paid vapor products, flavored vapor products, or 29 flavored nicotine analogue products seized pursuant to the authority of 30 this chapter or any other law of this state shall be turned over to the 31 department or its authorized representative. Such seized non-tax-paid 32 vapor products shall, after notice and an opportunity for a hearing, be 33 forfeited to the state. If the department determines the non-tax-paid 34 vapor products cannot be used for law enforcement purposes, it may, 35 within a reasonable time after the forfeiture of such non-tax-paid vapor 36 products, upon publication in the state registry, destroy such forfeited 37 non-tax-paid vapor products. 38 (e) Whenever a police officer designated in section 1.20 of the crimi- 39 nal procedure law or a peace officer designated in subdivision four of 40 section 2.10 of such law, acting pursuant to such officer's special 41 duties, shall discover any flavored vapor products or flavored nicotine 42 analogue products offered for retail sale in violation of the provisions 43 in section thirteen hundred ninety-nine-mm-1 of the public health law or 44 section eleven hundred eighty-three-b of this article, respectively, 45 such police officer or peace officer is hereby authorized and empowered 46 forthwith to seize and take possession of such flavored vapor products 47 or flavored nicotine analogue products. Such flavored vapor products or 48 flavored nicotine analogue products seized by a police officer or peace 49 officer shall be turned over to the commissioner. Such seized flavored 50 vapor products or flavored nicotine analogue products shall be forfeited 51 to the state. If the department determines the vapor products or 52 flavored nicotine analogue products cannot be used for law enforcement 53 purposes, it may, within a reasonable time after the forfeiture of such 54 vapor products or flavored nicotine analogue products, destroy such 55 forfeited vapor products or flavored nicotine analogue products.A. 4619 7 1 § 1184-b. General powers of the tax commission. The powers conferred 2 upon the tax commission by sections one hundred seventy-one and one 3 hundred seventy-one-b of this chapter shall, so far as applicable, be 4 exercisable with respect to the provisions of this article. Such commis- 5 sion may require returns to be filed with it at such times and contain- 6 ing such information as it may prescribe and in such event the fact that 7 a person's name is signed to the return shall be prima facie evidence 8 for all purposes that the return was actually signed by such person. 9 Notwithstanding any other provision of this article, the tax commission 10 may enter into an agreement with any city of this state which is author- 11 ized to impose a tax similar to that imposed by this article to provide 12 for the joint administration, in whole or in part, of such taxes. 13 § 6. This act shall take effect immediately.
