N.Y. Tax Law § 1110: Imposition of compensating use tax

§ 1110. Imposition of compensating use tax. (a) Except to the extent

that property or services have already been or will be subject to the

sales tax under this article, there is hereby imposed on every person a

use tax for the use within this state on and after June first, nineteen

hundred seventy-one except as otherwise exempted under this article, (A)

of any tangible personal property purchased at retail, (B) of any

tangible personal property (other than computer software used by the

author or other creator) manufactured, processed or assembled by the

user, (i) if items of the same kind of tangible personal property are

offered for sale by him in the regular course of business or (ii) if

items are used as such or incorporated into a structure, building or

real property by a contractor, subcontractor or repairman in erecting

structures or buildings, or building on, or otherwise adding to,

altering, improving, maintaining, servicing or repairing real property,

property or land, as the terms real property, property or land are

defined in the real property tax law, if items of the same kind are not

offered for sale as such by such contractor, subcontractor or repairman

or other user in the regular course of business, (C) of any of the

services described in paragraphs (1), (7) and (8) of subdivision (c) of

section eleven hundred five of this part, (D) of any tangible personal

property, however acquired, where not acquired for purposes of resale,

upon which any of the services described in paragraphs (2), (3) and (7)

of subdivision (c) of section eleven hundred five of this part have been

performed, (E) of any telephone answering service described in

subdivision (b) of section eleven hundred five of this part, (F) of any

computer software written or otherwise created by the user if the user

offers software of a similar kind for sale as such or as a component

part of other property in the regular course of business, (G) of any

prepaid telephone calling service, and (H) of any gas or electricity

described in subdivision (b) of section eleven hundred five of this

part.

(b) For purposes of clause (A) of subdivision (a) of this section, the

tax shall be at the rate of four percent of the consideration given or

contracted to be given for such property, or for the use of such

property, including any charges for shipping or delivery as described in

paragraph three of subdivision (b) of section eleven hundred one, but

excluding any credit for tangible personal property accepted in part

payment and intended for resale.

(c) For purposes of subclause (i) of clause (B) of subdivision (a) of

this section, the tax shall be at the rate of four percent of the price

at which items of the same kind of tangible personal property are

offered for sale by the user, and the mere storage, keeping, retention

or withdrawal from storage of tangible personal property by the person

who manufactured, processed or assembled such property shall not be

deemed a taxable use by him; provided, however, that if the user uses

such an item itself on its own premises (not including making a gift of

such tangible personal property), solely in the conduct of the user's

own business operations, and the item retains its characteristic as

tangible personal property when so used, the tax shall be at the rate,

and on the consideration, described in subdivision (d) of this section.

(d) For purposes of subclause (ii) of clause (B) of subdivision (a) of

this section, the tax shall be at the rate of four percent of the

consideration given or contracted to be given for the tangible personal

property manufactured, processed or assembled into the tangible personal

property the use of which is subject to tax, including any charges for

shipping or delivery as described in paragraph three of subdivision (b)

of section eleven hundred one.

(e) Notwithstanding the foregoing, provisions of this section, for

purposes of clause (B) of subdivision (a) of this section, there shall

be no tax on any portion of such price which represents the value added

by the user to tangible personal property which he fabricates and

installs to the specifications of an addition or capital improvement to

real property, property or land, as the terms real property, property or

land are defined in the real property tax law, over and above the

prevailing normal purchase price prior to such fabrication of such

tangible personal property which a manufacturer, producer or assembler

would charge an unrelated contractor who similarly fabricated and

installed such tangible personal property to the specifications of an

addition or capital improvement to such real property, property or land.

(f) For purposes of clauses (C), (D), and (E) of subdivision (a) of

this section, the tax shall be at the rate of four percent of the

consideration given or contracted to be given for the service, including

the consideration for any tangible personal property transferred in

conjunction with the performance of the service and also including any

charges for shipping and delivery of the property so transferred and of

the tangible personal property upon which the service was performed as

such charges are described in paragraph three of subdivision (b) of

section eleven hundred one.

(g) For purposes of clause (F) of subdivision (a) of this section, the

tax shall be at the rate of four percent of the consideration given or

contracted to be given for the tangible personal property which

constitutes the blank medium, such as disks or tapes, used in

conjunction with the software, or for the use of such property, and the

mere storage, keeping, retention or withdrawal from storage of computer

software described in such clause (F) by its author or other creator

shall not be deemed a taxable use by such person.

(h) For purposes of clause (G) of subdivision (a) of this section, the

tax shall be at the rate of four percent of the consideration given or

contracted to be given for the service, including the consideration for

any tangible personal property transferred in conjunction with the

service and also including any charges for shipping and delivery of the

property so transferred as such charges are described in paragraph three

of subdivision (b) of section eleven hundred one; provided that, if the

user offers like services for sale in the regular course of business,

the tax shall be at the rate of four percent of the price at which the

user offers such like services for sale.

(i) For purposes of clause (H) of subdivision (a) of this section, the

tax shall be at the rate of four percent of the consideration given or

contracted to be given for, or for the use of, the gas or electricity,

including the consideration for any tangible personal property

transferred in conjunction with the performance thereof, and including

any charges described in paragraph three of subdivision (b) of section

eleven hundred one of this article.