BILL NUMBER: S4489
SPONSOR: KRUEGER
 
TITLE OF BILL:
An act to amend the tax law, in relation to creating an excise tax on
the collection of consumer data by commercial data collectors
 
PURPOSE OR GENERAL IDEA OF BILL:
To raise revenue to fund state services by imposing a tax on the
collection of New Yorkers' consumer data by businesses for commercial
purposes.
 
SUMMARY OF PROVISIONS:
Amends Tax Law by adding new Section 186-h
Section 1. The bill imposes an excise tax on the collection of New York-
ers' consumer data based on the number of New York individuals on whom a
commercial data collector collects data within a month. The tax applies
regardless of the format in which the data is collected. The tax is
imposed on for-profit businesses that collect data, excluding basic
contact information, on over 1 million New York individuals in a given
month.
There is a graduated rate schedule that begins at 5 cents per individual
per month for commercial data collectors collecting data on over a
million New Yorkers in a month. The rate gradually increases, with the
highest rate 50 cents per individual per month paid on the number of
individual New Yorkers over 10 million on whom data is collected in a
month.
Other provisions impose filing and recordkeeping requirements, provide
that a taxpayer and the Tax Department may agree on a methodology for
determining the tax that simplifies compliance, and adopt certain admin-
istrative provisions that apply to existing taxes under Article 9 of the
tax law.
Section 2. The bill would be effective immediately with the imposition
of the tax beginning on the first day of the month that begins more than
six months after the law becomes effective.
 
JUSTIFICATION:
In the current marketplace, data about individual consumer interests and
preferences are an extraordinarily valuable asset. Some of the largest,
most successful data collectors are social media companies that amass
huge amounts of data on individual New Yorkers that is analyzed using
sophisticated technology to enhance the value of the advertising oppor-
tunities they offer. Much of this data comes from the consumers them-
selves, often without any awareness on the part of the individual whose
data is being collected.
The description above is only one manner in which data about New Yorkers
is collected and used. Big box retailers, internet retail platforms,
credit card companies, multi-media entertainment providers and most
other large companies maintain databases that they analyze for a range
of purposes, from selling advertising to evaluating the effectiveness of
their websites.
Only a small fraction of all businesses will collect data on over a
million New York consumers monthly, the threshold for being subject to
the tax.
The tax paid per consumer is extremely modest. The tax paid by a busi-
ness collecting data on 2 million New York consumers would be 30 cents a
year per consumer. The tax paid by a business collecting data on 10
million New York consumers would be $2.70 per consumer per year.
 
PRIOR LEGISLATIVE HISTORY:
2023-2024: S.2012/A.3959 Braunstein - Died in Committee
2021-2022: S.4959/A.6199 Braunstein -Died in committee
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
Increased revenues to the State in an amount to be determined
 
EFFECTIVE DATE:
Immediately and shall apply to all tax years commencing on or after the
first day of the first month that begins more than six months after the
law takes effect.