NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5496A
SPONSOR: Lupardo TITLE OF BILL:
An act to amend the tax law, in relation to the timeframe of distribu-
tors of cannabis products to file tax returns
PURPOSE OR GENERAL IDEA OF BILL:
The purpose of this legislation is to allow the cannabis excise tax to
be paid on a more flexible timeframe the better represents the structure
of the current Industry.
SUMMARY OF PROVISIONS:
Section 1: Subdivision (a) of section 495 of the tax law is amended.
Section 2: Establishes the effective date.
JUSTIFICATION:
Under current law, the cannabis excise tax is paid quarterly by cannabis
cultivators and processors to the NYS Department of Taxation and
Finance. This excise tax payment schedule creates situations where prod-
uct producers and processors often owe taxes before the product is sold
to consumers. This legislation changes the tax collection payment sched-
ule by allowing the option for the payment on or before the fiftieth day
after each quarterly tax period.
The slow opening of cannabis dispensaries, due to multiple factors, has
created a backlog of products on processors shelves, which have yet to
be sent or sold to retailers, yet the tax is still owed. Another factor
creating stress on the processor's ability to pay the excise tax, is
that some retail dispensaries are delinquent in paying for products they
have received. There is a prompt payment provision in the cannabis law,
but, due to many factors the provision is not being enforced. By allow-
ing the tax to be collected on a more flexible schedule it will allow
flexibility in the market as it matures and provides a financial life-
line to currently struggling producers and processors.
PRIOR LEGISLATIVE HISTORY:
Formerly A-10196 of 2023-24, Vetoed
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
There are no fiscal implications for State or Local Government as al
taxes owed will still be collected.
EFFECTIVE DATE:
This act shall take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
5496--A
2025-2026 Regular Sessions
IN ASSEMBLY
February 14, 2025
___________
Introduced by M. of A. LUPARDO, STIRPE, PEOPLES-STOKES -- read once and
referred to the Committee on Ways and Means -- committee discharged,
bill amended, ordered reprinted as amended and recommitted to said
committee
AN ACT to amend the tax law, in relation to the timeframe of distribu-
tors of cannabis products to file tax returns
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision (a) of section 495 of the tax law, as added by
2 chapter 92 of the laws of 2021, is amended to read as follows:
3 (a) Every person on whom tax is imposed under this article shall, on
4 or before the [twentieth] fiftieth day [of the month following] after
5 each quarterly period ending on the last day of February, May, August,
6 and November, respectively, file electronically with the commissioner a
7 return on forms to be prescribed by the commissioner, showing the total
8 amount of tax due in such quarterly period, and including such other
9 information as the commissioner may require.
10 § 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD01105-04-5
