N.Y. Tax Law § 485: Determination of cost of agent, retail dealer or wholesale dealer

§ 485. Determination of cost of agent, retail dealer or wholesale

dealer. (a) 1. In determining "cost of the retail dealer", "cost of the

agent" and "cost of the wholesale dealer" the tax commission or a court

shall receive and consider as bearing on the bona fides of such cost,

evidence tending to show that any such person complained against under

any of the provisions of this article purchased cigarettes, with respect

to the sale of which complaint is made, at a fictitious price, or upon

terms, or in such a manner, or under such invoices, as to conceal the

true costs, discounts or terms of purchase, and shall also receive and

consider as bearing on the bona fides of such cost, evidence of the

normal, customary and prevailing terms and discounts in connection with

other sales of a similar nature in the trade area or state.

2. Merchandise given gratis or payment made to an agent, retail dealer

or wholesale dealer by the manufacturer thereof for display, or

advertising, or promotion purposes, or otherwise, shall not be

considered in determining the cost of cigarettes to the agent, retail

dealer or wholesale dealer.

(b) In all advertisements, offers for sale or sales involving two or

more items, at least one of which items is cigarettes, at a combined

price, and in all advertisements, offers for sale, or sales involving

the giving of any gift or concession of any kind whatsoever (whether it

be coupons or otherwise), the agent's, retail dealer's or wholesale

dealer's combined selling price shall not be below the cost of the

agent, the cost of the retail dealer or the cost of the wholesale

dealer, respectively, of the total costs of all articles, products,

commodities, gifts and concessions included in such transactions.

(c) When one wholesale dealer sells cigarettes to any other wholesale

dealer, the former shall not be required to include in his selling price

to the latter, the cost of the wholesale dealer, as defined by paragraph

two of subdivision (b) of section four hundred eighty-three of this

article, except that no such sale shall be made at a price less than the

cost of the agent for sales to wholesale dealers as defined by paragraph

one of subdivision (b) of section four hundred eighty-three of this

article, but the latter wholesale dealer, upon resale to a retail

dealer, shall be deemed to be the wholesale dealer governed by the

provisions of paragraph two of subdivision (b) of section four hundred

eighty-three of this article.

(d) When one agent sells cigarettes to any other agent, the former

shall not be required to include in his selling price to the latter, the

cost of the agent, as defined by paragraph one of subdivision (b) of

section four hundred eighty-three of this article, except that no such

sale shall be made at a price less than the basic cost of cigarettes, as

defined by paragraph one of subdivision (a) of section four hundred

eighty-three, but the latter agent, upon resale of such cigarettes,

shall be deemed to be the agent governed by paragraph one of subdivision

(b) of section four hundred eighty-three of this article. Cigarettes

sold by an agent to an agent must be picked up at the warehouse of the

selling agent, or delivered to the warehouse of the purchasing agent.