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NY STATE LIMO SALES TAX TO BE DISCUUSED THURSDAY JUNE 4, 2009

INSIDE THE NEW NY STATE LIMO SALES TAX

NSLA/LBOA/Howard H. * June 1, 2009

NEW YORK CITY -- On Thursday, May 28, 2009 a hearing was held by the Honorable Judge Roger D. McDonough in Albany concerning the new NY State Sales Tax to be imposed starting June 1, 2009 on our Industry transportation services.

The tax legislation was passed and signed by NY State Governor David A. Paterson, on April 8, 2009 as part of the state budget. This tax excluded taxis and buses but required livery, black car, limousines, community cars and vans dispatched from a central facility and certain other motor vehicles. The court action was brought by the BCAC, 13 individual companies of the Black Car Assistance Group (BCAC); the Luxury Base Operators Association (LBOA) and the Nassau Suffolk Limousine Association (NSLA) all as plaintiffs.

The action before the court was to seek a Temporary Restraining Order (TRO) to prevent New York State from implementing the law until the full court case could be heard.

The plaintiffs were represented by attorneys Jonathan Mazer, Esq. and Wayne Baden, Esq. of the law firm of Schlam Stone & Dolan, LLP.

The arguments were that the NYS Tax Department issued guidance on May 22, 2009 which was insufficient time for the plaintiffs to implement the tax. The necessary administrative programs could not be implemented by June 1st and that the manner in which the law was promulgated violated due process and therefore unconstitutional. Finally it was stated that if the plaintiffs were successful and the law reversed it would cause irreparable harm.

Judge Roger D. McDonough ruled that there was insufficient evidence shown to issue the restraining order and instructed both sides to schedule the discovery dates and court trial.

This means that everyone in the Industry needs to start collecting the sales tax as explained in the New York State Department of Taxation and Finance Office of Tax Policy Analysis Taxpayer Guidance Division (TSB-M- 09(7)S, dated May 22, 2009.

The NYS Tax Guidance and a copy of the complaint can be viewed at URL http://www.lboausa.org/index.php?option=com_content&task=view&id=55&Itemid=98 (Click!) and download both the Amended Complaint and NYS Sales Tax 22 May 09.

Victor D. has called a meeting for this Thursday June 4, at the LGA Marriott to be attended by all associations and our entire industry. The discussions will focus on what actions should be taken concerning the court case and implementing the tax.

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