N.Y. Tax Law § 209-b: Metropolitan transportation business tax surcharge

§ 209-B. Metropolitan transportation business tax surcharge. 1. (a)

For the privilege of exercising its corporate franchise, or of doing

business, or of employing capital, or of owning or leasing property in a

corporate or organized capacity, or of maintaining an office, or of

deriving receipts from activity in the metropolitan commuter

transportation district, for all or any part of its taxable year, there

is hereby imposed on every corporation, other than a New York S

corporation, subject to tax under section two hundred nine of this

article, or any receiver, referee, trustee, assignee or other fiduciary,

or any officer or agent appointed by any court, who conducts the

business of any such corporation, a tax surcharge, in addition to the

tax imposed under section two hundred nine of this article, to be

computed at the rate of seventeen percent of the tax imposed under such

section for such taxable years or any part of such taxable years ending

on or after December thirty-first, nineteen hundred eighty-three and

before January first, two thousand fifteen after the deduction of any

credits otherwise allowable under this article, at the rate of

twenty-five and six-tenths percent of the tax imposed under such section

for taxable years beginning on or after January first, two thousand

fifteen and before January first, two thousand sixteen before the

deduction of any credits otherwise allowable under this article, at the

rate determined by the commissioner pursuant to paragraph (f) of this

subdivision of the tax imposed under such section, for taxable years

beginning on or after January first, two thousand sixteen and before

January first, two thousand twenty-four before the deduction of any

credits otherwise allowable under this article, and at the rate of

thirty percent of the tax imposed under such section for taxable years

beginning on or after January first, two thousand twenty-four before the

deduction of any credits otherwise allowable under this article.

However, such rate of tax surcharge shall be applied only to that

portion of the tax imposed under section two hundred nine of this

article before the deduction of any credits otherwise allowable under

this article which is attributable to the taxpayer's business activity

carried on within the metropolitan commuter transportation district; and

provided, further, the surcharge computed on a combined report shall

include a surcharge on the fixed dollar minimum tax for each member of

the combined group subject to the surcharge under this subdivision.

(b) A corporation is deriving receipts from activity in the

metropolitan commuter transportation district if it has receipts within

the metropolitan commuter transportation district of one million dollars

or more in a taxable year. For purposes of this section, the term

"receipts" means the receipts that are subject to the apportionment

rules set forth in section two hundred ten-A of this article, and the

term "receipts within the metropolitan commuter transportation district"

means the receipts included in the numerator of the apportionment factor

determined under subdivision two of this section. For purposes of this

paragraph, receipts from processing credit card transactions for

merchants include merchant discount fees received by the corporation.

(c) A corporation is doing business in the metropolitan commuter

transportation district if (i) it has issued credit cards to one

thousand or more customers who have a mailing address within the

metropolitan commuter transportation district as of the last day of its

taxable year, (ii) it has merchant customer contracts with merchants and

the total number of locations covered by those contracts equals one

thousand or more locations in the metropolitan commuter transportation

district to whom the corporation remitted payments for credit card

transactions during the taxable year, or (iii) the sum of the number of

customers described in subparagraph (i) of this paragraph plus the

number of locations covered by its contracts described in subparagraph

(ii) of this paragraph equals one thousand or more. As used in this

paragraph, the term "credit card" includes bank, credit, travel and

entertainment cards.

(d)(i) A corporation with less than one million dollars but at least

ten thousand dollars of receipts within the metropolitan commuter

transportation district in a taxable year that is part of a unitary

group that meets the ownership test under section two hundred ten-C of

this article is deriving receipts from activity in the metropolitan

commuter transportation district if the receipts within the metropolitan

commuter transportation district of the members of the unitary group

that have at least ten thousand dollars of receipts within the

metropolitan commuter transportation district in the aggregate meet the

threshold set forth in paragraph (b) of this subdivision.

(ii) A corporation that does not meet any of the thresholds set forth

in paragraph (c) of this subdivision but has at least ten customers, or

locations, or customers and locations, as described in paragraph (c),

and is part of a unitary group that meets the ownership test under

section two hundred ten-C of this article is doing business in the

metropolitan commuter transportation district if the number of

customers, locations, or customers and locations, within the

metropolitan commuter transportation district of the members of the

unitary group that have at least ten customers, locations, or customers

and locations, within the metropolitan commuter transportation district

in the aggregate meets any of the thresholds set forth in paragraph (c)

of this subdivision.

(iii) For purposes of this paragraph, any corporation described in

paragraph (c) of subdivision two of section two hundred ten-C of this

article shall not be considered.

(e) At the end of each year, the commissioner shall review the

cumulative percentage change in the consumer price index. The

commissioner shall adjust the receipt thresholds set forth in this

subdivision if the consumer price index has changed by ten percent or

more since the January first, two thousand fifteen or since the date

that the thresholds were last adjusted under this subdivision. The

thresholds shall be adjusted to reflect that cumulative percentage

change in the consumer price index. The adjusted thresholds shall be

rounded to the nearest one thousand dollars. As used in this paragraph,

"consumer price index" means the consumer price index for all urban

consumers (CPI-U) available from the bureau of labor statistics of the

United States department of labor. Any adjustment shall apply to tax

periods that begin after the adjustment is made.

(f) The commissioner shall determine the rate of tax for taxable years

beginning on or after January first, two thousand sixteen and before

January first, two thousand twenty-four by adjusting the rate for

taxable years beginning on or after January first, two thousand fifteen

and before January first, two thousand sixteen as necessary to ensure

that the receipts attributable to such surcharge, as impacted by part A

of chapter fifty-nine of the laws of two thousand fourteen, will meet

and not exceed the financial projections for state fiscal year two

thousand sixteen-two thousand seventeen, as reflected in state fiscal

year two thousand fifteen-two thousand sixteen enacted budget. The

commissioner shall annually determine the rate thereafter, for taxable

years beginning before January first, two thousand twenty-four, using

the financial projections for the state fiscal year that commences in

the year for which the rate is to be set as reflected in the enacted

budget for the fiscal year commencing on the previous April first.

2. The portion of the taxpayer's business activity carried on within

the metropolitan commuter transportation district shall be determined by

multiplying the tax imposed under section two hundred nine of this

article before the deduction of any credits otherwise allowable under

this article by a percentage to be determined as follows:

(a) ascertaining the percentage which the average value of the

taxpayer's real and tangible personal property, whether owned or rented

to it, within the metropolitan commuter transportation district during

the period covered by its report bears to the average value of all the

taxpayer's real and tangible personal property, whether owned or rented

to it, within the state during such period; provided that the term

"value of the taxpayer's real and tangible personal property" shall mean

the adjusted bases of such properties for federal income tax purposes

(except that in the case of rented property such value shall mean the

product of (i) eight and (ii) the gross rents payable for the rental of

such property during the taxable year); provided, however, that the

taxpayer may make a one-time, revocable election to use fair market

value as the value of all of its real and tangible personal property,

provided that such election is made on or before the due date for filing

a report under section two hundred eleven for the taxpayer's first

taxable year commencing on or after January first, two thousand fifteen

and provided that such election shall not apply to any taxable year with

respect to which the taxpayer is included on a combined report unless

each of the taxpayers included on such report has made such an election

which remains in effect for such year;

(b) ascertaining the percentage of the taxpayer's receipts within the

metropolitan commuter transportation district pursuant to the method

prescribed in section two hundred ten-A of this article, except that

(i) the numerator of the apportionment fraction under such section two

hundred ten-A shall be the denominator of the apportionment fraction

under this paragraph,

(ii) the numerator of the apportionment fraction under this paragraph

shall be determined by applying the rules in such section two hundred

ten-A relating to the numerator of the apportionment fraction as if

those rules referenced the metropolitan commuter transportation district

rather than this state,

(iii) to the extent that a provision in such section two hundred ten-A

provides that eight percent of the receipts specified in that provision

should be included in the numerator of the apportionment fraction,

ninety percent of such eight percent amount shall be considered within

the metropolitan commuter transportation district and one hundred

percent of such eight percent amount shall be considered to be within

the state, and

(iv) to the extent that a provision in such section two hundred ten-A

of this article provides that the receipts specified in that provision

shall not be included in the numerator of the apportionment fraction

under such section two hundred ten-A, such receipts shall not be

included in determining the portion of the taxpayer's business activity

carried on within the metropolitan commuter transportation district;

(c) ascertaining the percentage of the total wages, salaries and other

personal service compensation, similarly computed, during such period,

of employees within the metropolitan commuter transportation district,

except general executive officers, to the total wages, salaries and

other personal service compensation, similarly computed, during such

period, of all the taxpayer's employees within the state, except general

executive officers; and

(d) adding together the percentages so determined and dividing the

result by the number of percentages.

3. A corporation shall not be deemed to be doing business, employing

capital, owning or leasing property, or maintaining an office, or

deriving receipts from activity in the metropolitan commuter

transportation district, for the purposes of this section, by reason of

(a) the maintenance of cash balances with banks or trust companies in

the metropolitan commuter transportation district, or (b) the ownership

of shares of stock or securities kept in the metropolitan commuter

transportation district, if kept in a safe deposit box, safe, vault or

other receptacle rented for the purpose, or if pledged as collateral

security, or if deposited with one or more banks or trust companies, or

brokers who are members of a recognized security exchange, in

safekeeping or custody accounts, or (c) the taking of any action by any

such bank or trust company or broker, which is incidental to the

rendering of safekeeping or custodian service to such corporation, or

(d) the maintenance of an office in the metropolitan commuter

transportation district by one or more officers or directors of the

corporation who are not employees of the corporation if the corporation

otherwise is not doing business in the metropolitan commuter

transportation district, and does not employ capital or own or lease

property in the metropolitan commuter transportation district, or (e)

the keeping of books or records of a corporation in the metropolitan

commuter transportation district if such books or records are not kept

by employees of such corporation and such corporation does not otherwise

do business, employ capital, own or lease property or maintain an office

in the metropolitan commuter transportation district, or (f) any

combination of the foregoing activities.

4. Notwithstanding any contrary provisions of state or local law, the

tax surcharge imposed under this section shall not be allowed as a

deduction in the computation of any tax imposed under this chapter.

Furthermore, the credits otherwise allowable under this article shall

not be allowed against the tax surcharge imposed by this section.

5. The provisions concerning reports under sections two hundred ten-C

and two hundred eleven shall be applicable to this section, except that

for purposes of an automatic extension for six months for filing a

report covering the tax surcharge imposed by this section, such

automatic extension shall be allowed only if a taxpayer files with the

commissioner an application for extension in such form as said

commissioner may prescribe by regulation and pays on or before the date

of such filing in addition to any other amounts required under this

article, either ninety percent of the entire tax surcharge required to

be paid under this section for the applicable period, or not less than

the tax surcharge shown on the taxpayer's return for the preceding

taxable year, if such preceding taxable year was a taxable year of

twelve months; provided, however, that in no event shall such amount be

less than the product of the following three amounts: (1) the tax

surcharge rate in effect for the taxable year pursuant to subdivision

one of this section, (2) the fixed dollar minimum applicable to such

taxpayer as determined under paragraph (d) of subdivision one of section

two hundred ten of this chapter for the taxable year, and (3) the

percentage determined under subdivision two of this section for the

preceding taxable year, unless the taxpayer was not subject to the tax

surcharge imposed pursuant to this section with respect to such year, in

which case such percentage shall be deemed to be one hundred percent.

The tax surcharge imposed by this section shall be payable to the

commissioner in full at the time the report is required to be filed, and

such tax surcharge or the balance thereof, imposed on any taxpayer which

ceases to exercise its franchise or be subject to the tax surcharge

imposed by this section shall be payable to the commissioner at the time

the report is required to be filed, provided such tax surcharge of a

domestic corporation which continues to possess its franchise shall be

subject to adjustment as the circumstances may require; all other tax

surcharges of any such taxpayer, which pursuant to the foregoing

provisions of this section would otherwise be payable subsequent to the

time such report is required to be filed, shall nevertheless be payable

at such time. All of the provisions of this article presently applicable

are applicable to the tax surcharge imposed by this section.

6. The term metropolitan commuter transportation district as used in

this section shall be defined pursuant to section twelve hundred

sixty-two of the public authorities law.