Final New York Budget Maintains Sales Tax Exemption For ESCO Customers

A passed and adopted version of New York state's budget does not terminate the existing exemption from state sales tax granted to customers of ESCOs for transmission and distribution of electricity and gas sold to such customers.

Non-residential transmission and distribution charges are subject to what is colloquially known as state sales tax (technically a compensating use tax), and non-residential default service customers pay such tax for T&D service. However, ESCO customers are exempt from paying this T&D sales tax.

New York Governor Andrew Cuomo had proposed eliminating this exemption in an earlier version of the budget, but the proposal was not included in the state's final budget

Non-residential commodity supply is subject to state sales tax regardless of the supplier

There is no residential state sales tax on utility delivery service, regardless of the customer's supplier.