Unlawful Tax Collection

Adopted Rules: Closed to Comments

Effective Date: 
Saturday, August 6, 2016
Agency:
Keywords:

Notice of Adoption of Rule

 

Notice of Adoption of a new Rule regarding the collection of sales taxes on goods and services that are not subject to such tax laws.

NOTICE IS HEREBY GIVEN PURSUANT TO THE AUTHORITY VESTED IN the Commissioner of the Department of Consumer Affairs (the “Department”) by Section 2203 of the New York City Charter and Section 20-702 of Subchapter 1 of Chapter 5 of Title 20 of the New York City Administrative Code, and in accordance with the requirements of Section 1043 of the New York City Charter, that the Department promulgates and adopts Section 5-41 of Subchapter A of Chapter 5 of Title 6 of the Rules of the City of New York, declaring that the collection of sales taxes on goods and services that are not subject to such tax laws shall be a deceptive trade practice.

The rule was proposed and published on April 9, 2015.  The public hearing was held on May 11, 2015.  The comment period concluded on May 29, 2015.  After the hearing, which no one attended, one written comment was submitted.

 

Statement of Basis and Purpose of Rule

Section 2203 of Chapter 64 of the Charter of the City of New York authorizes the Commissioner to enforce laws prohibiting deceptive trade practices, and, upon notice and hearing, to impose civil penalties for the violation of such laws.  Section 2203(h)(3) provides that no act or practice shall be deemed a deceptive trade practice unless it has been declared as such, and described with reasonable particularity in a law or rule promulgated by the Commissioner.   

 

Pursuant to Title 20 of the New York City Administrative Code, the Department regulates merchants in New York City and promulgates rules and regulations to protect consumers in the marketplace.  Article 28 of the New York State Tax law specifies the categories of goods and services that are subject to sales and use taxes.  The proposed rule is necessary to declare that collection of sales taxes on goods and services that are not subject to such tax laws shall be a deceptive trade practice for purposes of Section 20-701 of Subchapter 1 of Chapter 5 of Title 20 of the New York City Administrative Code.