Section 4-b - Credit relating to certain sales and compensating use taxes(1) In addition to the credit allowed by section four-a of such chapter, a taxpayer shall be allowed a credit against the tax imposed by this part to be credited or refunded in the manner hereinafter provided in this section. The amount of such credit shall be the excess of (A) the amount of sales and compensating use taxes imposed by section eleven hundred seven of the tax law during the taxpayer's taxable year which became legally due on or after and was paid on or after July first, nineteen hundred seventy-seven, less any credits or refunds of such taxes, with respect to the purchase or use by the taxpayer of machinery or equipment for use or consumption directly and predominantly in the production of tangible personal property, gas, electricity, refrigeration or steam for sale, by manufacturing, processing, generating, assembling, refining, mining or extracting, or telephone central office equipment or station apparatus or comparable telegraph equipment for use directly and predominantly in receiving at destination or initiating and switching telephone or telegraph communication, but not including parts with a useful life of one year or less or tools or supplies used in connection with such machinery, equipment or apparatus over (B) the amount of any credit for such sales and compensating use taxes allowed or allowable against the taxes imposed by any local law of the city imposing a tax on utilities and vendors of utility services, for any periods embraced within the taxable year of the taxpayer under this part. (2)The credit allowed under this section for any taxable year shall be deemed to be an overpayment of tax by the taxpayer to be credited or refunded, without interest, in accordance with the provisions of section seventy-seven of this title.(3)Where the taxpayer receives a refund or credit of any tax imposed under section eleven hundred seven of the tax law for which the taxpayer had claimed a credit under the provisions of section four-b of such chapter in a prior taxable year, the amount of such tax refund or credit shall be added to the tax imposed by section three of such chapter, and such amount shall be subtracted in computing entire net income for the taxable year.N.Y. General City Model Law § 4-b