TITLE OF BILL: An act to amend the tax law, in relation to the sales
tax exemption for car wash facilities
PURPOSE: To expand the sales tax exemption for coin-operated car wash
services to authorize the exemption where payment is made by credit or
JUSTIFICATION: Under current law, coin-operated car wash services are
exempt from sales tax. "Coin-operated" is defined to include
coin-operated, currency-operated or token operated, but does not
include credit or debit card machine transactions. If a coin-operated
car wash business adds equipment to authorize payment by credit or
debit card, then the coin operated services are not subject to sales
tax under current law, but the services paid for through the credit or
debit card machine are subject to sales tax. This requires a separate
accounting for the credit or debit card transactions, with the
associated additional burdens for the car wash business owner. Car
wash businesses install credit or debit card machines as a convenience
to consumers and they should not be required to pay sales tax on these
services, which would otherwise be exempt from sales taxation, because
they are offering a more modem mode of payment as a convenience to the
In addition, when sales tax is required to be paid on car wash
services paid for through credit or debit card machines, the car wash
business is subject to double taxation because it must also pay sales
tax on the products and equipment purchased to provide the car wash.
It is inequitable to tax these small businessmen at two levels in the
chain of commerce and this bill would remedy this inequity.
LEGISLATIVE HISTORY: A.4668 of 2011/2012: referred to ways and means
A.4757 of 2009/2010: referred to ways and means 2007/2008: Veto Memo
FISCAL IMPLICATIONS: Undetermined.
EFFECTIVE DATE: This act shall take effect on the first day of a
sales tax quarterly period as described in subdivision (b) of section
1136 of the tax law, occurring at least sixty days after this act
shall have become a law.