N.Y. Comp. Codes R. & Regs. tit. 20 § 525.2

Current through Register Vol. 46, No. 16, April 17, 2024

Section 525.2 - Nature of tax

(a) Sales tax.

(1)

(i) Except as specifically exempted or excluded, sales tax is imposed on the receipts from:

(a) every retail sale of tangible personal property, as provided in section 1105(a) of the Tax Law;

(b) every sale, other than a sale for resale, of specifically enumerated services, as provided in sections 1105(b) and (c); and

(c) every sale of food and drink when sold in or by a restaurant, tavern or other establishment or by a caterer, as provided in section 1105(d).

(ii) Sales tax is also imposed on rent for every occupancy of a hotel room and on admission charges, dues and other amusement charges, as provided in sections 1105(e) and (f) of the Tax Law, respectively.

(iii) Each of the various types of transactions has statutory exemptions, exceptions, exclusions and limitations. See, for example, sections 1111, 1115 and 1116 of the Tax Law.

(2) Except as specifically provided otherwise, the sales tax is a "transactions tax," with the liability for the tax occurring at the time of the transaction. Generally, a taxed transaction is an act resulting in the receipt of consideration for the transfer of title to or possession of (or both) tangible personal property or for the rendition of an enumerated service. The time or method of payment is generally immaterial, since the tax becomes due at the time of transfer of title to or possession of (or both) the property or the rendition of such service (but see section 1132[a][2] regarding materialmen).

(3) Except as specifically provided otherwise, the sales tax is a "destination tax." The point of delivery or point at which possession is transferred by the vendor to the purchaser, or the purchaser's designee, controls both the tax incidence and the tax rate.

(4) The sales tax is generally a "consumer tax." That is, the person required to collect tax must collect the tax from the customer (i.e., the consumer) when collecting the taxable receipt, rent or amusement charge to which the tax applies. The customer cannot shift the liability for payment of the tax to another person nor otherwise be relieved of such liability. The vendor, or other person required to collect the tax, collects the tax as trustee for and on account of the State and is also personally liable for the tax required to be collected.

(b) Compensating use tax.

(1) The compensating use tax is imposed on the use within the State of certain tangible personal property and certain enumerated services:

(i) purchased by a New York resident (as defined in section 526.15 of this Title) outside of the State, which would have been subject to sales tax if purchased in this State; or

(ii) purchased in the State but, for various reasons, the sales tax was not paid at the time of purchase.

(2) Compensating use tax is also imposed on the use within this State of certain tangible personal property manufactured, processed or assembled by the user, including, certain computer software written or otherwise created by the user.

Cross-reference: see Part 531 of this Title.

N.Y. Comp. Codes R. & Regs. Tit. 20 § 525.2