GCM - General City Model 772/66

     Section  1.    Notwithstanding  any  other  provision  of  law  to the  contrary, any city having a population of one million  or  more,  acting  through  its  local legislative body, is hereby authorized and empowered  to adopt and amend local laws  imposing  for  any  such  city  taxes  on  general   corporations,   financial   corporations   and  transportation  corporations at the rates provided herein, or if alternative  rates  are  provided,  then,  in  such  event, at either of such rates. The terms of  such local law or local laws shall be, substantially, as follows  except  that  any such local law may be amended for the purpose of conforming it  with similar provisions of articles 9-A, 27 and 32 (except section  1456  thereof) of the tax law and section 8 of chapter 167 of the laws of 1972  as presently in effect or as they may be amended provided, however, that  the  definition  set  forth in subsection (c) of section 1450 of the tax  law and the deduction set forth in subsection (f) of section 1453 of the  tax law shall be incorporated in any local law imposing a tax such as is  imposed by article 32 of the tax law and provided further, that  credits  analogous  to  the  credits  provided  in  paragraphs  (b)  and  (c)  of  subdivision 1 of section 4-h of part 2 of this section  and  subject  to  the limitations contained in such part, may be incorporated in any local  law  imposing  a tax such as is imposed under article 32 of the tax law,  and provided further, that a  provision  analogous  to  paragraph  1  of  subsection  (b)  of  section  1455  of  the tax law, as such paragraph 1  existed immediately prior to its repeal by section 24 of chapter 298  of  the laws of 1985 (but subject to the amendments contained in paragraph 2  of subdivision (b) of section 11-643.5 of the administrative code of the  city  of  New  York),  shall  continue  to apply to banking corporations  organized under the laws of any country other than the United States and  provided further, however, that in the  event  that  any  local  law  is  adopted  imposing a tax such as is imposed by such article 32 of the tax  law, then no tax imposed by such city for any periods for  which  a  tax  such  as  is  imposed by such article 32 is imposed and the rates of tax  under any such local law imposing a tax  such  as  is  imposed  by  such  article  32  shall  be,  for  the  basic  tax analogous to that fixed by  subsection (a) of section 1455 of the tax law, no greater than nine  per  centum,  for  the  alternative minimum tax analogous to that fixed under  paragraph 1 of subsection (b) of  such  section,  as  such  paragraph  1  existed  prior to its repeal by section 24 of chapter 298 of the laws of  1985 (but  subject  to  the  amendments  contained  in  paragraph  2  of  subdivision  (b)  of  section 11-643.5 of the administrative code of the  city of New York), no greater than two and six-tenths mills  per  dollar  of  issued  capital  stock  or  the  excess of average total assets over  average  total  liabilities  apportionable  to  such   city,   for   the  alternative  minimum  tax analogous to that fixed under such paragraph 1  as added by section 24 of such chapter, no greater than one-tenth  of  a  mill,  for  the  alternative  minimum  tax  analogous  to  that fixed by  paragraph 2 of such subsection, no greater than three percent,  and  for  the  alternative  minimum  tax analogous to that fixed by paragraph 3 of  such subsection, no greater than one  hundred  twenty-five  dollars  and  except  that  the  appendix  in  such  local laws may be amended for the  purpose of conforming it with the United States internal revenue code or  other federal laws relating to taxation as presently  in  effect  or  as  they  may  be amended, and provided further, however, any such local law  imposing a tax such as is imposed by such article 32 may be  amended  to  conform it with the analogous provisions of subparagraph 11 of paragraph  (a), subparagraph 13 of paragraph (b) and paragraphs (l), (m) and (n) of  subdivision 8 of section 2 of section 1 of this chapter:

                               CITY BUSINESS TAX                                   PART I                             GENERAL PROVISIONS  Section  1.   Definitions.                                   PART II                           GENERAL CORPORATION TAX  Section  2.   Definitions.           3.   Imposition of tax; exemptions.           4.   Computation of tax.           4-a. Credit relating to stock transfer tax.           4-b. Credit  relating  to  certain  sales  and compensating use                  taxes.           4-c. Credit relating to certain expenses involved in  the  cost                  of   relocating  industrial  and  commercial  employment                  opportunities.          (4-d) Credit relating to the annual increase in certain payments                  to a landlord by a taxpayer  relocating  industrial  and                  commercial employment opportunities.           4-e. Credit  relating  to  certain  sales  and compensating use                  taxes.           4-f. Credit relating to  certain  sales  and  compensating  use                  taxes  on  electricity used in manufacturing, processing                  or assembling.           4-h. Relocation and employment assistance credit.           5.   Reports.           6.   Payment and lien of tax.           7.   Declaration of estimated tax.           8.   Payments on account of estimated tax.           9.   Collection of taxes.          10.   Limitations of time.                                  PART III                          FINANCIAL CORPORATION TAX                                  SUBPART 1                TAX ON STATE BANKS, TRUST COMPANIES, FINANCIAL               CORPORATIONS AND SAVINGS AND LOAN ASSOCIATIONS  Section  11.  Definitions.          *12.  Tax based on net  income;  imposition;  minimum  tax;  new                  corporations; dissolution; consolidations; mergers; etc.           13.  Years for which imposed.           14.  Ascertainment of gain or loss.           15.  Exchange of property.           16.  Exchange of property when no gain or loss is realized.           17.  Inventory.           18.  Net income defined.           19.  Computation of net income.           20.  Gross income defined.           21.  Deductions.           22.  Items not deductible.          * Does not conform to section heading in text of law.                                  SUBPART 2                  TAX ON NATIONAL BANKING ASSOCIATIONS AND                       PRODUCTION CREDIT ASSOCIATIONS  Section 23.   Imposition of tax.          24.   Years for which imposed.          25.   Ascertainment of gain or loss; exchange of property.          26.   Inventory.          27.   Net income defined; computation.

          28.   Gross income defined.          29.   Deductions.          30.   Administration; procedure; provisions of law applicable.          31.   Tax on production credit associations.                                  SUBPART 3                     ADMINISTRATION FOR SUBPARTS 1 AND 2  Section 32.   Taxpayers' returns.          33.   Consolidated returns.          34.   Payment of tax.          35.   Declaration  of  estimated  tax;  payments  on  account of                  estimated tax.          36.   Real property taxable.                                   PART V                       TRANSPORTATION CORPORATION TAX  Section 61.   Tax on transportation corporations and associations.          62.   Additional  tax   on   transportation   corporations   and                  associations.          63.   Receivers, etc., conducting corporate business.          64.   Service of process; limitations of time.          65.   Exemption of Corporations Owned by a Municipality.          66.   Reports of Corporations.          67.   Payment of tax and penalties.          68.   Taxable years to which taxes apply.          69.   First reports for nineteen hundred sixty-six.                                   PART VI                (CORPORATE TAX PROCEDURE AND ADMINISTRATION)  Section 71.   Application of part.          72.   Notice of Deficiency.          73.   Assessment.          74.   Limitations on Assessment.          75.   Interest on underpayment.          76.   Additions to tax and civil penalties.          77.   Overpayment.          78.   Limitations of credit or refund.          79.   Interest on overpayment.          80.   Petition to director of finance.          81.   Review of director's decision.          82.   Mailing rules; holidays.          83.   Collection, levy and liens.          84.   Transferees.          85.   Jeopardy assessment.          86.   Criminal penalties.          87.   General powers of director of finance.          88.   Secrecy required of official; penalty for violation.          89.   Disposition of revenues.          90.   Inconsistencies with other laws.          91.   Effect of invalidity in part.                                    PART I                             GENERAL PROVISIONS    Section 1. Definitions. When used in parts one through six:    1. "Taxpayer" means any corporation subject to tax;    2. "City" or "the city" means the city imposing the tax;    3. "State," "the state" or "this state" means the state of New York;    4.  "Tax  commission,"  "department of state," "department of taxation  and  finance,"  "department  of  public  service,"  and  "department  of  insurance," refers to agencies and departments of the state;    5. "Commission" means the tax commission of the state;

    6.  "Tax law," "insurance law," "private housing finance law," "public  health law," "public housing law,"  "finance  law,"  "general  municipal  law,"   "public  service  law,"  "general  corporation  law,"  "business  corporation law," "civil practice law  and  rules,"  "code  of  criminal  procedure," and "banking law," refer to laws of the state;    7. "Attorney General," "superintendent of insurance," "commissioner of  taxation  and  finance," "secretary of state," "commissioner of health,"  and "comptroller," refer to officials of the state;    8. "Director of finance" means the director of finance or other fiscal  officer of the city charged with administration of excise taxes  by  the  charter of the city or by other provision of law.    9. "Domestic corporation" means a corporation organized under the laws  of the state; and    10.  Unless  a different meaning is clearly required, any term used in  any title other than parts four and five shall have the same meaning  as  when  used  in  a  comparable  context  in the laws of the United States  relating to federal income taxes, and any reference to the laws  of  the  United  States shall mean the provisions of the internal revenue code of  nineteen  hundred  fifty-four,  and  amendments   thereto,   and   other  provisions  of  the laws of the United States relating to federal income  taxes, as the same are included in the title  appendix  hereinafter  set  forth  or  as  included  by  reference  to  an appendix of another title  enacted by the same local law. (The quotation of the aforesaid  laws  of  the  United  States  is  intended to make them a part of any appropriate  title and to avoid constitutional uncertainties which  might  result  if  such  laws  were  merely  incorporated  by reference. The quotation of a  provision of the federal internal revenue code or of any  other  law  of  the United States shall not necessarily mean that it is applicable to or  has relevance to any of the titles.)    11.  "Title,"  when  used in any part except parts four or five, means  all parts except parts four or five, and, when used in part four or part  five, means the part in  which  it  is  used  together  with  part  one;  provided,  however,  that, whenever it is used in a manner which clearly  shows that it is intended  to  encompass  all  parts,  it  shall  be  so  construed.                                    PART II                           GENERAL CORPORATION TAX    § 2. Definitions. When used in this part:    1. "Corporation" includes a joint-stock company or association and any  business  conducted  by  a  trustee  or  trustees  wherein  interest  or  ownership is evidenced by certificate or other written instrument;    2. "Subsidiary" means a corporation of which over fifty per centum  of  the  number of shares of stock entitling the holders thereof to vote for  the election of directors or trustees is owned by the taxpayer;    3. "Subsidiary capital" means investments in the stock of subsidiaries  and any indebtedness from subsidiaries,  whether  or  not  evidenced  by  written instrument, on which interest is not claimed and deducted by the  subsidiary  for  purposes  of  taxation under this part or part three of  this title, provided, however, that, in the discretion of  the  director  of  finance,  there  shall  be  deducted  from  subsidiary  capital  any  liabilities payable by their terms on demand or within one year from the  date incurred, other than loans or advances outstanding for more than  a  year  as  of  any  date during the year covered by the report, which are  attributable to subsidiary capital;    4. "Investment capital" means investments in stocks, bonds  and  other  securities,  corporate  and governmental, not held for sale to customers  in the regular course of business, exclusive of subsidiary  capital  and  stock issued by the taxpayer, provided, however, that, in the discretion

  of  the  director  of  finance  there  shall be deducted from investment  capital any liabilities payable by their terms on demand or  within  one  year  from  the  date incurred, other than loans or advances outstanding  for  more  than  a  year  as  of any date during the year covered by the  report, which are attributable to investment capital;    5. "Investment income" means income, including capital gains in excess  of capital losses, from investment capital, to the  extent  included  in  computing entire net income, less, (a) in the discretion of the director  of  finance,  any  deductions  allowable  in computing entire net income  which are attributable to investment capital or investment  income,  and  (b)  such  portion  of  any  net  operating  loss deduction allowable in  computing entire net income,  as  the  investment  income,  before  such  deduction,  bears to entire net income, before such deduction, provided,  however, that in no case  shall  investment  income  exceed  entire  net  income;    6. "Business capital" means all assets, other than subsidiary capital,  investment  capital  and  stock issued by the taxpayer, less liabilities  not deducted from subsidiary or investment capital which are payable  by  their  terms  on demand or within one year from the date incurred, other  than loans or advances outstanding for more than a year as of  any  date  during  the  year  covered  by  the  report, except that, subject to the  provisions of subdivision six of section four of this part, cash on hand  and on deposit shall be treated as investment  capital  or  as  business  capital as the taxpayer may elect;    7. "Business income" means entire net income minus investment income;    8.  "Entire  net income" means total net income from all sources which  shall be the same  as  the  taxpayer's  entire  federal  taxable  income  computed  without  regard  to any election under subchapter s of chapter  one of the internal revenue code, except as  hereinafter  provided,  and  subject  to  any  modification  required by paragraph (d) of subdivision  three of section four of this part.    (a) Entire net income shall not include:    (1) income, gains and losses from  subsidiary  capital  which  do  not  include the amount of a recovery in respect of any war loss;    (2) fifty per centum of dividends other than from subsidiaries;    (3) bona fide gifts;    (4) income and deductions with respect to amounts received from school  districts and from corporations and associations, organized and operated  exclusively  for  religious, charitable or educational purposes, no part  of the net earnings of which  inures  to  the  benefit  of  any  private  shareholder or individual, for the operation of school buses; and    (5)  any refund or credit of a tax imposed under this part, or imposed  by article nine or article nine-A of the  tax  law,  for  which  tax  no  exclusion  or deduction was allowed in determining the taxpayer's entire  net income under this part for any prior year;    (6) in the case of a taxpayer who is separately or as a partner  of  a  partnership  doing  an  insurance  business  as a member of the New York  insurance exchange described in paragraph  (a)  of  subdivision  one  of  section  four  hundred  twenty-five-a  of the insurance law, any item of  income, gain, loss or deduction of such business which is the taxpayer's  distributive or pro rata share for federal income tax purposes or  which  the  taxpayer  is  required  to take into account separately for federal  income tax purposes.    (7) for taxable years beginning after December thirty-first,  nineteen  hundred eighty-one, except with respect to property which is a qualified  mass  commuting vehicle described in subparagraph (D) of paragraph eight  of subsection (f) of section one hundred  sixty-eight  of  the  internal  revenue code (relating to qualified mass commuting vehicles), any amount

  which  is  included in the taxpayer's federal taxable income solely as a  result of an election made pursuant to the provisions of such  paragraph  eight  as  it was in effect for agreements entered into prior to January  first, nineteen hundred eighty-four;    (8)  for taxable years beginning after December thirty-first, nineteen  hundred eighty-one, except with respect to property which is a qualified  mass commuting vehicle described in subparagraph (D) of paragraph  eight  of  subsection  (f)  of  section one hundred sixty-eight of the internal  revenue code (relating to qualified mass commuting vehicles), any amount  which the taxpayer could have excluded from federal taxable  income  had  it  not made the election provided for in such paragraph eight as it was  in effect for agreements entered into prior to January  first,  nineteen  hundred eighty-four;    (9)   the   amount  deductible  pursuant  to  paragraph  (j)  of  this  subdivision; and    (10) upon the disposition of recovery property to which paragraph  (j)  of  this subdivision applies, the amount, if any, by which the aggregate  of the amounts described in subparagraph eleven of paragraph (b) of this  subdivision attributable to such property exceeds the aggregate  of  the  amounts  described  in paragraph (j) of this subdivision attributable to  such property.    (11) for taxable years ending after September  10,  2001,  the  amount  deductible pursuant to paragraph (1) of this subdivision.    (b)  Entire  net  income  shall  be  determined without the exclusion,  deduction or credit of:    (1) the amount of any specific exemption or credit allowed in any  law  of  the  United  States imposing any tax on or measured by the income of  corporations,    (2) any part of any income from dividends or interest on any  kind  of  stock, securities or indebtedness, except as provided in clauses one and  two of paragraph (a) hereof,    (3)  taxes  paid  or  accrued  to  the United States on or measured by  profits or income or to the state under article nine or  nine-a  of  the  tax law,    (4) taxes imposed under this part,    (4-a) (A) the entire amount allowable as an exclusion or deduction for  stock  transfer  taxes  imposed  by  article  twelve  of  the tax law in  determining the entire taxable income which the taxpayer is required  to  report  to  the United States treasury department but only to the extent  that such taxes are incurred and paid in market making transactions  and  (B)  the  amount  allowed as an exclusion or deduction for sales and use  taxes imposed by  section  eleven  hundred  seven  of  the  tax  law  in  determining  the entire taxable income which the taxpayer is required to  report to the United States treasury department but only such portion of  such exclusion or deduction which is not in excess of the amount of  the  credit allowed pursuant to section four-b of this part.    (4-b)  the  amount allowed as an exclusion or deduction imposed by the  tax law in determining the entire taxable income which the  taxpayer  is  required  to  report  to  the United States treasury department but only  such portion of such exclusion or deduction which is not  in  excess  of  the  amount  of  the  credit or part thereof allowed pursuant to section  four-c of this part with respect to a taxable year.    (4-c) the amount allowed as an exclusion or deduction imposed  by  the  tax  law  in determining the entire taxable income which the taxpayer is  required to report to the United States  treasury  department  but  only  such  portion  of  such exclusion or deduction which is not in excess of  the amount of the credit allowed pursuant  to  section  four-d  of  this  part.

    (4-d)  The  amount  allowed as an exclusion or deduction for sales and  use taxes imposed by section eleven hundred seven  of  the  tax  law  in  determining  the entire taxable income which the taxpayer is required to  report to the United States Treasury Department but only such portion of  such  exclusion or deduction which is not in excess of the amount of the  credit allowed pursuant to section four-e of this part.    (4-e) the amount allowed as an exclusion or deduction  for  sales  and  use  taxes  imposed  by  section  eleven hundred seven of the tax law in  determining the entire taxable income which the taxpayer is required  to  report  to  the United States treasury department, but only such portion  of such exclusion or deduction which is not in excess of the  amount  of  the credit allowed pursuant to section four-f of this part.    (5)  ninety  per  centum  of  interest  on  indebtedness  directly  or  indirectly  owed  to   any   stockholder   or   shareholder   (including  subsidiaries  of  a corporate stockholder or shareholder), or members of  the immediate family of an individual stockholder or shareholder, owning  in the aggregate in excess of five per  centum  of  the  issued  capital  stock  of  the taxpayer, except that such interest may, in any event, be  deducted    (A) up to an amount not exceeding one thousand dollars,    (B) in full to the extent that it relates to bonds or other  evidences  of  indebtedness  issued,  with  stock,  pursuant to a bona fide plan of  reorganization, to persons, who, prior to such reorganization, were bona  fide creditors of the corporation or  its  predecessors,  but  were  not  stockholders or shareholders thereof,    (C)  in  full where the investment allocation percentage is applied to  entire net income, and    (D) in full to the extent that it is  paid  to  a  federally  licensed  small business investment company;    (6)  in  the  discretion  of  the  director  of finance, any amount of  interest  directly  or  indirectly  and  any   other   amount   directly  attributable  as a carrying charge or otherwise to subsidiary capital or  to income, gains or losses from subsidiary capital; and    (7) any amount by reason of the granting, issuing  or  assuming  of  a  restricted  stock  option,  as  defined  in the internal revenue code of  nineteen hundred fifty-four, or by reason of the transfer of  the  share  of  stock upon the exercise of the option, unless such share is disposed  of by the grantee of the option within two years from the  date  of  the  granting  of  the option or within six months after the transfer of such  share to him;    (8) in the case of a taxpayer who is separately or as a partner  of  a  partnership  doing  an  insurance  business  as a member of the New York  insurance exchange described in paragraph  (a)  of  subdivision  one  of  section four hundred twenty-five-a of the insurance law, such taxpayer's  distributive  or  pro  rata  share of the allocated entire net income of  such business as determined under sections  fifteen  hundred  three  and  fifteen hundred four of the tax law, provided however, in the event such  allocated  entire  net income is a loss, such taxpayer's distributive or  pro rata share of such loss shall not be subtracted from federal taxable  income in computing entire net income under this subdivision.    (9) for taxable years beginning after December thirty-first,  nineteen  hundred eighty-one, except with respect to property which is a qualified  mass  commuting vehicle described in subparagraph (D) of paragraph eight  of subsection (f) of section one hundred  sixty-eight  of  the  internal  revenue code (relating to qualified mass commuting vehicles), any amount  which  the  taxpayer  claimed  as  a  deduction in computing its federal  taxable income solely as a result of an election made  pursuant  to  the

  provisions  of  such  paragraph eight as it was in effect for agreements  entered into prior to January first, nineteen hundred eighty-four;    (10) for taxable years beginning after December thirty-first, nineteen  hundred eighty-one, except with respect to property which is a qualified  mass  commuting vehicle described in subparagraph (D) of paragraph eight  of subsection (f) of section one hundred  sixty-eight  of  the  internal  revenue code (relating to qualified mass commuting vehicles), any amount  which   the  taxpayer  would  have  been  required  to  include  in  the  computation of its federal taxable income had it not made  the  election  permitted  pursuant  to  such  paragraph  eight  as it was in effect for  agreements  entered  into  prior  to  January  first,  nineteen  hundred  eighty-four;    (11) for taxable years beginning after December thirty-first, nineteen  hundred  eighty-one, except with respect to recovery property subject to  the provisions of section two hundred eighty-F of the  internal  revenue  code  and  recovery  property placed in service in this state in taxable  years  beginning   after   December   thirty-first,   nineteen   hundred  eighty-four  the  amount  allowable  as  a  deduction  under section one  hundred sixty-eight of the internal revenue code;    (12) upon the disposition of recovery property to which paragraph  (j)  of  this subdivision applies, the amount, if any, by which the aggregate  of the amounts described in such  paragraph  (j)  attributable  to  such  property  exceeds the aggregate of the amounts described in subparagraph  eleven of this paragraph attributable to such property.    (13) for taxable years ending after September 10, 2001, in the case of  qualified property described in paragraph 2 of subsection k  of  section  168  of  the internal revenue code, other than qualified resurgence zone  property described in paragraph (n) of this subdivision, and other  than  qualified  New  York  Liberty  Zone property described in paragraph 2 of  subsection b of section 1400L of  the  internal  revenue  code  (without  regard  to clause (i) of subparagraph (C) of such paragraph), the amount  allowable as a deduction under section 167 of the internal revenue code.    (c) Entire net income shall include  income  within  and  without  the  United States;    (d)  The director of finance may, whenever necessary in order properly  to reflect the entire net income of any taxpayer, determine the year  or  period  in  which  any  item  of  income or deduction shall be included,  without regard to the method of accounting employed by the taxpayer;    (e) The entire net income of any bridge commission created by  act  of  congress  to  construct  a bridge across an international boundary means  its gross income less the  expense  of  maintaining  and  operating  its  properties,  the  annual  interest upon its bonds and other obligations,  and the annual charge for the retirement of such bonds or obligations at  maturity;    (f) A net operating loss deduction shall be allowed which shall be the  same as the net operating  loss  deduction  allowed  under  section  one  hundred  seventy-two  of  the  internal revenue code or which would have  been allowed if the taxpayer had not made an election under subchapter s  of chapter one of the internal revenue code, except  that  (1)  any  net  operating  loss included in determining such deduction shall be adjusted  to reflect the inclusions and exclusions from entire net income pursuant  to paragraphs (a), (b), (g) and (h) hereof, (2)  such  deductions  shall  not  include any net operating loss sustained during any taxable year in  which the taxpayer was not subject to the tax imposed by this part,  (3)  such  deduction  shall  not  exceed  the  deduction for the taxable year  allowable under section one hundred seventy-two of the internal  revenue  code,  or  the  deduction  for  the  taxable  year which would have been  allowable if the taxpayer had not made an election under subchapter s of

  chapter one of the internal revenue code, and (4) any net operating loss  for a taxable year beginning in nineteen  hundred  eighty-one  shall  be  computed  without  regard  to  the  deduction  allowed  with  respect to  recovery  property under section one hundred sixty-eight of the internal  revenue code; in lieu of such deduction, a taxpayer shall be allowed for  such taxable  year  with  respect  to  such  property  the  depreciation  deduction  allowable  under section one hundred sixty-seven of such code  as such section was in full force and effect on  December  thirty-first,  nineteen hundred eighty;    (g)  At the election of the taxpayer, a deduction shall be allowed for  expenditures  paid  or  incurred  during  the  taxable  year   for   the  construction,  reconstruction,  erection  or  improvement  of industrial  waste treatment facilities and air pollution control facilities.    (1) (A) The term "industrial waste treatment  facilities"  shall  mean  facilities   for  the  treatment,  neutralization  or  stabilization  of  industrial waste (as the term "industrial waste" is defined  in  section  twelve  hundred  two  of the public health law) from a point immediately  preceding the point of such treatment, neutralization  or  stabilization  to   the   point  of  disposal,  including  the  necessary  pumping  and  transmitting facilities, but excluding such facilities installed for the  primary  purpose  of  salvaging  materials  which  are  usable  in   the  manufacturing process or are marketable.    (B)  The term "air pollution control facilities" shall mean facilities  which remove, reduce, or render less noxious  air  contaminants  emitted  from  an  air  contamination  source (as the terms "air contaminant" and  "air  contamination  source"  are  defined  in  section  twelve  hundred  sixty-seven  of  the  state  public health law) from a point immediately  preceding the point of such removal, reduction or rendering to the point  of discharge of air, meeting emission standards as  established  by  the  air pollution control board, but excluding such facilities installed for  the  primary  purpose  of  salvaging  materials  which are usable in the  manufacturing process or are marketable and excluding  those  facilities  which rely for their efficacy on dilution, dispersion or assimilation of  air contaminants in the ambient air after emission.    (2) However, such deduction shall be allowed only    (A)  with  respect to tangible property which is depreciable, pursuant  to section one hundred sixty-seven of the internal revenue code,  having  a  situs  in  the city and used in the taxpayer's trade or business, the  construction, reconstruction, erection or improvement of which,  in  the  case  of industrial waste treatment facilities, is initiated on or after  January first, nineteen hundred sixty-six,  and  only  for  expenditures  paid  or  incurred prior to January first, nineteen hundred seventy-two,  or which, in the case of air pollution control facilities, is  initiated  on or after January first, nineteen hundred sixty-six, and    (B) on condition that such facilities have been certified by the state  commissioner of health or his designated representative, pursuant to the  public health law, as complying with applicable provisions of the public  health  law,  the state sanitary code and regulations, permits or orders  issued pursuant thereto, and    (C) on condition that entire net income for the taxable year  and  all  succeeding  taxable  years  be  computed without any deductions for such  expenditures or for depreciation of the same  property  other  than  the  deductions  allowed  by this paragraph (g) except to the extent that the  basis of the property may be attributable to  factors  other  than  such  expenditures,  or  in  case  a  deduction  is allowable pursuant to this  paragraph for only a part of such expenditures, on  condition  that  any  deduction  allowed for federal income tax purposes for such expenditures  or for depreciation of the same property be proportionately  reduced  in

  computing  entire  net  income  for  the taxable year and all succeeding  taxable years, and    (D)  where  the  election provided for in paragraph (d) of subdivision  three of section four of this part has not been exercised in respect  to  the same property.    (3)  (A)  If  expenditures in respect to an industrial waste treatment  facility or an air pollution control  facility  have  been  deducted  as  provided herein and if within ten years from the end of the taxable year  in which such deduction was allowed such property or any part thereof is  used  for the primary purpose of salvaging materials which are usable in  the manufacturing process or are marketable, the taxpayer  shall  report  such change of use in its report for the first taxable year during which  it  occurs,  and  the  director of finance may recompute the tax for the  year or years for which such deduction was allowed and any carryback  or  carryover  year,  and  may assess any additional tax resulting from such  recomputation within the time fixed  by  paragraph  (h)  of  subdivision  three of section seventy-four.    (B) If a deduction is allowed as herein provided for expenditures paid  or  incurred  during  any  taxable  year  on  the  basis  of a temporary  certificate of compliance issued pursuant to the public health  law  and  if  the  taxpayer  fails to obtain a permanent certificate of compliance  upon completion of the facilities with respect to which  such  temporary  certificate  was  issued,  the taxpayer shall report such failure in its  report for the taxable year during which such facilities are  completed,  and  the director of finance may recompute the tax for the year or years  for which such deduction was allowed  and  any  carryback  or  carryover  year,   and   may   assess   any  additional  tax  resulting  from  such  recomputation within the time fixed  by  paragraph  (h)  of  subdivision  three of section seventy-four.    (4)  In  any  taxable year when property is sold or otherwise disposed  of, with respect to which a deduction has been allowed pursuant to  this  paragraph,  such  deduction  shall  be  disregarded in computing gain or  loss, and the gain or loss on the sale  or  other  disposition  of  such  property  shall  be  the  gain  or loss entering into the computation of  entire taxable income which the taxpayer is required to  report  to  the  United States treasury department for such taxable year;    (h) With respect to gain derived from the sale or other disposition of  any   property   acquired  prior  to  January  first,  nineteen  hundred  sixty-six, which had a federal adjusted basis on such date  (or  on  the  date  of  its sale or other disposition prior to January first, nineteen  hundred sixty-six) lower than its fair market value  on  January  first,  nineteen  hundred sixty-six or the date of its sale or other disposition  prior thereto, except property described in subsections one and four  of  section  twelve  hundred  twenty-one  of  the internal revenue code, the  difference between---    (a) the amount of the taxpayer's federal taxable income, and    (b) the amount of the taxpayer's federal taxable  income  (if  smaller  than  the  amount  described in (a)) computed as if the federal adjusted  basis of each such property (on the sale or other disposition  of  which  gain  was derived) on the date of the sale or other disposition had been  equal to either (i) its fair market value  on  January  first,  nineteen  hundred  sixty-six or the date of its sale or other disposition prior to  January first, nineteen hundred sixty-six, plus or minus all adjustments  to basis made with respect to  such  property  for  federal  income  tax  purposes  for  periods  on  and  after  January  first, nineteen hundred  sixty-six or (ii) the amount realized  from  its  sale  or  disposition,  whichever  is  lower;  provided,  however,  that  the total modification  provided by this paragraph (h)  shall  not  exceed  the  amount  of  the

  taxpayer's  net  gain  from  the  sale  or other disposition of all such  property.    (i)  If  the  period covered by a report under this part is other than  the  period  covered  by  the  report  to  the  United  States  treasury  department,  entire  net  income  shall be determined by multiplying the  federal taxable income (as adjusted pursuant to the provisions  of  this  part) by the number of calendar months or major parts thereof covered by  the report under this part and dividing by the number of calendar months  or  major  parts thereof covered by the report to such department. If it  shall appear that such method of determining entire net income does  not  properly  reflect the taxpayer's income during the period covered by the  report under this part, the director of finance shall be  authorized  in  his  discretion  to determine such entire net income solely on the basis  of the taxpayer's income during the period covered by its  report  under  this part.    (j)  For taxable years beginning after December thirty-first, nineteen  hundred eighty-one, except with respect to recovery property subject  to  the  provisions  of section two hundred eighty-F of the internal revenue  code and recovery property placed in service in this  state  in  taxable  years   beginning   after   December   thirty-first,   nineteen  hundred  eighty-four, and provided a deduction has not been excluded from  entire  net  income  pursuant  to  subparagraph  nine  of  paragraph (b) of this  subdivision, a taxpayer  shall  be  allowed  with  respect  to  recovery  property  the depreciation deduction allowable under section one hundred  sixty-seven of the internal revenue code  as  such  section  would  have  applied to property placed in service on December thirty-first, nineteen  hundred eighty.    (l)  for taxable years ending after September 10, 2001, in the case of  qualified property described in paragraph 2 of subsection k  of  section  168  of  the internal revenue code, other than qualified resurgence zone  property described in paragraph (n) of this subdivision, and other  than  qualified  New  York  Liberty  Zone property described in paragraph 2 of  subsection b of section 1400L of  the  internal  revenue  code  (without  regard  to clause (i) of subparagraph (C) of such paragraph), a taxpayer  shall  be  allowed  with  respect  to  such  property  the  depreciation  deduction  allowable  under  section 167 of the internal revenue code as  such section would have applied to such property had it been acquired by  the taxpayer on September 10, 2001.    (m) for taxable years  ending  after  September  10,  2001,  upon  the  disposition  of  property  to  which  paragraph  (l) of this subdivision  applies, the amount of any gain or loss includible in entire net  income  shall  be  adjusted to reflect the inclusions and exclusions from entire  net income pursuant to subparagraph 11 of paragraph (a) and subparagraph  13 of paragraph (b) of this subdivision attributable to such property.    (n) for purposes of  paragraphs  (l)  and  (m)  of  this  subdivision,  qualified   resurgence  zone  property  shall  mean  qualified  property  described in paragraph 2 of subsection k of section 168 of the  internal  revenue  code substantially all of the use of which is in the resurgence  zone, as defined below, and is in the  active  conduct  of  a  trade  or  business  by the taxpayer in such zone, and the original use of which in  the resurgence zone commences with  the  taxpayer  after  September  10,  2001. The resurgence zone shall mean the area of New York county bounded  on the south by a line running from the intersection of the Hudson River  with  the  Holland Tunnel, and running thence east to Canal Street, then  running along the centerline of Canal Street to the intersection of  the  Bowery  and  Canal  Street,  running thence in a southeasterly direction  diagonally across Manhattan Bridge Plaza, to the  Manhattan  Bridge  and  thence  along  the centerline of the Manhattan Bridge to the point where

  the centerline of the Manhattan Bridge would intersect with the easterly  bank of the East River, and bounded on the north by a line running  from  the intersection of the Hudson River with the Holland Tunnel and running  thence  north  along  West Avenue to the intersection of Clarkson Street  then running east  along  the  centerline  of  Clarkson  Street  to  the  intersection   of  Washington  Avenue,  then  running  south  along  the  centerline of Washington Avenue to  the  intersection  of  West  Houston  Street,  then  east along the centerline of West Houston Street, then at  the intersection of the Avenue of the Americas continuing east along the  centerline of East Houston Street to  the  easterly  bank  of  the  East  River.    9.  (a)  The  term  "calendar  year" means a period of twelve calendar  months (or any shorter period beginning on the date the taxpayer becomes  subject to the tax imposed by this part) ending on the thirty-first  day  of  December, provided the taxpayer keeps its books on the basis of such  period or on the basis of any period ending on any day  other  than  the  last  day  of  a  calendar month, or provided the taxpayer does not keep  books, and includes, in case the taxpayer  changes  the  period  on  the  basis of which it keeps its books from a fiscal year to a calendar year,  the  period  from  the  close  of  its  last  old  fiscal year up to and  including the following December thirty-first.    (b) The term "fiscal year" means a period of  twelve  calendar  months  (or  any  shorter  period  beginning  on  the  date the taxpayer becomes  subject to the tax imposed by this part) ending on the last day  of  any  month  other than December, provided the taxpayer keeps its books on the  basis of such period, and includes, in case  the  taxpayer  changes  the  period  on the basis of which it keeps its books from a calendar year to  a fiscal year or from one fiscal year to another fiscal year, the period  from the close of its last old calendar or fiscal year up  to  the  date  designated as the close of its new fiscal year.    10.  The  term  "tangible  personal property" means corporeal personal  property,  such  as  machinery,  tools,  implements,  goods,  wares  and  merchandise,  and  does  not  mean  money,  deposits in banks, shares of  stock, bonds, notes, credits or evidences of an interest in property and  evidences of debt.    § 3. Imposition of tax; exemptions.   1. For the  privilege  of  doing  business in the city in a corporate or organized capacity for all or any  part  of each of its fiscal or calendar years, every domestic or foreign  corporation, except corporations specified in subdivision four  of  this  section,  shall  annually  pay  a  tax, upon the basis of its entire net  income, or upon such other basis as may  be  applicable  as  hereinafter  provided,  for such fiscal or calendar year or part thereof, on a report  which shall be filed, except as hereinafter provided, on or  before  the  fifteenth  day of March next succeeding the close of each such year, or,  in the case of a taxpayer which reports on the basis of a  fiscal  year,  within  two and one-half months after the close of such fiscal year, and  shall be paid as hereinafter provided.    2. The holding of real property in the city  shall  be  deemed  to  be  doing  business  in  the  city  within  the  meaning  of  this  part.  A  corporation shall not be deemed to be doing business in  the  city,  for  the  purposes  of  this  part,  by reason of (a) the maintenance of cash  balances with banks or trust companies in the city, or (b) the ownership  of shares of stock or securities kept in the city, if  kept  in  a  safe  deposit  box, safe, vault or other receptacle rented for the purpose, or  if pledged as collateral security, or if  deposited  with  one  or  more  banks  or  trust  companies,  or brokers who are members of a recognized  security exchange, in safekeeping or custody accounts, or (c) the taking  of any action by any such bank or trust  company  or  broker,  which  is

  incidental  to the rendering of safekeeping or custodian service to such  corporation, or (d) any combination of the foregoing activities.    3. Any receiver, referee, trustee, assignee or other fiduciary, or any  officer  or  agent  appointed by any court, who conducts the business of  any corporation, shall be subject to the tax imposed by this part in the  same manner and to the same extent as if the business were conducted  by  the  agents  or  officers  of  such corporation. A dissolved corporation  which continues to conduct business shall also be  subject  to  the  tax  imposed by this part.    4.  Corporations  subject  to  tax under part three, part four or part  five, or under a local law of the city imposing a tax on utilities,  and  any  trust  company organized under a law of this state all of the stock  of which is owned by not less than twenty savings banks organized  under  a  law  of  this  state,  and  housing companies organized and operating  pursuant to the provisions of article two, article four or article  five  of  the  private  housing finance law, shall not be subject to tax under  this part; provided, however,  that  corporations,  other  than  utility  corporations  subject  to  the  supervision  of  the state department of  public service, which are subject to tax under a local law of  the  city  imposing  a  tax  on vendors of utility services shall be subject to tax  under this part on that percentage of their entire net income  allocable  to  the  city  under  section four which their receipts other than those  taxable under such local law taxing vendors of utility  services  is  of  their total receipts.    5.  The  tax  imposed  by  subdivision  one  of this section, with the  modifications provided by subdivision six of this  section,  is  imposed  for each calendar or fiscal year beginning with calendar or fiscal years  ending in or with the calendar year nineteen hundred sixty-six.    6.  (a)  The  tax  for  any  taxable  year  ending  prior  to December  thirty-first, nineteen hundred sixty-six shall be an amount equal to the  tax imposed by subdivision one of this section for  such  taxable  year,  multiplied  by  the number of months (or major portions thereof) in such  taxable year which occur after December thirty-first,  nineteen  hundred  sixty-five  and  divided  by  the  number  of  months (or major portions  thereof) in such taxable year.    (b) In lieu  of  the  method  of  computation  of  tax  prescribed  in  paragraph  (a)  of this subdivision, if the taxpayer maintained adequate  records for the portion of any taxable year  ending  prior  to  December  thirty-first, nineteen hundred sixty-six, which portion falls within the  calendar  year  nineteen  hundred sixty-six, it may elect to compute the  tax for such taxable year by determining entire net income on the  basis  of  the  entire  taxable income which it would have reported for federal  income tax purposes had it filed a  federal  income  tax  return  for  a  taxable  year  beginning  January  first, nineteen hundred sixty-six and  ending with the close of its actual taxable year and such  taxable  year  beginning  January first, nineteen hundred sixty-six, shall be deemed to  be the period covered by its report, except that in computing  such  tax  any  portion  of  a  capital  loss  which  results  from  a capital loss  carryover and any net operating loss deduction, as modified pursuant  to  paragraph  (f)  of  subdivision eight of section two shall be reduced by  the same part of such portion of  such  capital  loss  or  of  such  net  operating  loss deduction (as the case may be) as the number of months (  or major portions thereof) in the taxable year occurring before  January  first,  nineteen  hundred sixty-six is of the number of months (or major  portions thereof) in such taxable year.    § 4. Computation of tax. * 1. The tax imposed by  subdivision  one  of  section three of this part shall be, in the case of each taxpayer: (a) a  tax  (1) for taxable years beginning on or after January first, nineteen

  hundred  seventy-eight  but  before  January  first,  nineteen   hundred  eighty-seven,  computed  at the rate of nine per centum, and for taxable  years  beginning  on  or   after   January   first,   nineteen   hundred  eighty-seven,  computed  at  the  rate  of  eight  and  eighty-five  one  hundredths per centum on its entire net income, or the  portion  thereof  allocated  within  the  city  as  hereinafter  provided,  subject to any  modification required by paragraph (d)  of  subdivision  three  of  this  section,  or  (2)  computed at one and one-half mills for each dollar of  its total business  and  investment  capital,  or  the  portion  thereof  allocated  within  the  city as hereinafter provided, except that in the  case of a cooperative housing corporation as  defined  in  the  internal  revenue  code,  the applicable rate shall be four-tenths of one mill, or  (3) for taxable years beginning on  or  after  January  first,  nineteen  hundred   seventy-eight  but  before  January  first,  nineteen  hundred  eighty-seven, computed at the rate of nine per centum, and  for  taxable  years   beginning   on   or   after   January  first,  nineteen  hundred  eighty-seven,  computed  at  the  rate  of  eight  and  eighty-five  one  hundredths  per centum on thirty per centum of the taxpayer's entire net  income plus salaries and  other  compensation  paid  to  the  taxpayer's  elected  or appointed officers and to every stockholder owning in excess  of five per centum of its issued capital stock  minus  fifteen  thousand  dollars  (except  as  hereinafter  provided)  and  any  net loss for the  reported year, or on the portion of such sum allocated within  the  city  as hereinafter provided for the allocation of entire net income, subject  to  any  modification  required by paragraph (d) of subdivision three of  this section, or (4) one hundred twenty-five dollars, whichever  is  the  greatest,  plus  (b)  a  tax computed at the rate of three-quarters of a  mill for each dollar of the portion of its subsidiary capital  allocated  within the city as hereinafter provided. In the case of a taxpayer which  is not subject to tax for an entire year, or which elects to compute its  tax  pursuant  to paragraph (b) of subdivision six of section three, the  exemption allowed in clause three of paragraph  (a)  shall  be  prorated  according to the period such taxpayer was subject to tax or, in the case  of  such  an  election,  the  period  for which its entire net income is  determined pursuant to such paragraph (b) of subdivision six of  section  three.    * NB Effective until December 31, 2011    * 1.  The tax imposed by subdivision one of section three of this part  shall be, in the case of each taxpayer: (a) a tax (1)  computed  at  the  rate  of  five and one-half per centum, or as an alternative for taxable  years beginning on or after January first, nineteen hundred seventy-one,  at the rate of six and  seven-tenths  per  centum,  on  its  entire  net  income,  or the portion thereof allocated within the city as hereinafter  provided, subject to any  modification  required  by  paragraph  (d)  of  subdivision  three of this section, or (2) computed at one mill for each  dollar of its total business and  investment  capital,  or  the  portion  thereof  allocated  within the city as hereinafter provided, except that  in the case of a cooperative  housing  corporation  as  defined  in  the  internal  revenue  code, the applicable rate shall be one-quarter of one  mill, or (3) computed at the rate of five and one-half per centum, or as  an alternative for taxable years beginning on or  after  January  first,  nineteen  hundred  seventy-one,  at the rate of six and seven-tenths per  centum, on thirty per centum of the taxpayer's entire  net  income  plus  salaries  and  other  compensation  paid  to  the  taxpayer's elected or  appointed officers and to every stockholder owning in excess of five per  centum of its  issued  capital  stock  minus  fifteen  thousand  dollars  (except as hereinafter provided) and any net loss for the reported year,  or  on  the portion of such sum allocated within the city as hereinafter

  provided for the  allocation  of  entire  net  income,  subject  to  any  modification  required  by  paragraph  (d)  of subdivision three of this  section, or (4) twenty-five dollars, whichever is the greatest, plus (b)  a  tax  computed  at  the  rate  of one-half mill for each dollar of the  portion  of  its  subsidiary  capital  allocated  within  the  city   as  hereinafter  provided. In the case of a taxpayer which is not subject to  tax for an entire year, or which elects to compute its tax  pursuant  to  paragraph (b) of subdivision six of section three, the exemption allowed  in  clause  three  of  paragraph  (a) shall be prorated according to the  period such taxpayer was subject to tax or,  in  the  case  of  such  an  election,  the  period  for  which  its  entire net income is determined  pursuant to such paragraph (b) of subdivision six of section three.    * NB Effective December 31, 2011    2. The amount of subsidiary capital, investment capital  and  business  capital shall each be determined by taking the average fair market value  of  the  gross  assets  included  therein (less, in the case of business  capital, average liabilities deductible therefrom which are  payable  by  their  terms  on demand or within one year from the date incurred, other  than loans or advances outstanding for more than a year as of  any  date  during  the  year  covered by the report), and, if the period covered by  the report is  other  than  a  period  of  twelve  calendar  months,  by  multiplying  such  value by the number of calendar months or major parts  thereof included in such period, and dividing the product thus  obtained  by twelve.    3.  The portion of the entire net income of a taxpayer to be allocated  within the city shall be determined as follows:    (a) multiply its business income by a business  allocation  percentage  to be determined by    (1)  ascertaining  the  percentage  which  the  average  value  of the  taxpayer's real and tangible personal property within  the  city  during  the  period  covered by its report bears to the average value of all the  taxpayer's real and tangible personal property wherever situated  during  such period;    (2)  ascertaining  the  percentage which the receipts of the taxpayer,  computed on the cash  or  accrual  basis  according  to  the  method  of  accounting  used  in  the  computation of its entire net income, arising  during such period from    (A) sales of its tangible personal property located within the city at  the time of the  receipt  of  or  appropriation  to  the  orders,  where  shipments are made to points within the city,    (B) sales of its tangible personal property not located at the time of  the  receipt  of  or  appropriation  to  the  orders at any permanent or  continuous place of business maintained by the taxpayer without the city  where the orders were received or accepted within  the  city  and  where  shipments are made to points within the city,    (C) sales of its tangible personal property located within the city at  the time of the receipt of or appropriation to the orders where shipment  is made to points outside of the city and sales of its tangible personal  property (except sales described in clause (B)) located without the city  at  the  time  of  the  receipt  of or appropriation to the orders where  shipment is made to points within the city, but only to  the  extent  of  fifty  per  centum  of  the  receipts from the sales referred to in this  clause,    (D) sales of its tangible personal property not located at the time of  the receipt of or appropriation  to  the  orders  at  any  permanent  or  continuous  place  of  business  maintained  by the taxpayer without the  city, where the orders were received or accepted  within  the  city  and  where  shipment is made between points outside the city, but only to the

  extent of fifty per centum of the receipts from the sales referred to in  this clause. For purposes of this clause and clause (B) an  order  shall  be  deemed  received or accepted within the city if it has been received  or  accepted  by  an  employee,  agent, agency or independent contractor  chiefly situated at, connected with, by contract or otherwise,  or  sent  out  from  a  permanent  or continuous place of business of the taxpayer  within the city,    (E) services performed within the city,    (F) rentals from property situated  and  royalties  from  the  use  of  patents or copyrights, within the city, and    (G) all other business receipts earned within the city,  bear to the total amount of the taxpayer's receipts, similarly computed,  arising  during  such  period  from  all  sales of its tangible personal  property,  services,  rentals,  royalties   and   all   other   business  transactions, whether within or without the city;    (3) ascertaining the percentage of the total wages, salaries and other  personal service compensation, similarly computed, during such period of  employees  within  the  city,  except general executive officers, to the  total wages, salaries and other personal service compensation, similarly  computed, during such period of all the taxpayer's employees within  and  without the city, except general executive officers, and    (4)  adding  together  the  percentages so determined and dividing the  result by the number of percentages;  provided,  however,  that  if  the  taxpayer  does  not  have  a  regular place of business outside the city  other than a statutory office, the business allocation percentage  shall  be one hundred per centum; and    (b)  multiply  its  investment  income  by  an  investment  allocation  percentage to be determined by    (1) multiplying the amount of its investment capital invested in  each  stock,  bond  or  other  security  (other  than governmental securities)  during the period covered by its report by the percentage,  if  any,  of  the  entire  capital  or  the  issued capital stock, or the gross direct  premiums, or the net income, as the  case  may  be,  of  the  issuer  or  obligor  thereof  required to be allocated within the city on the report  or reports, if any, required of any such issuer or  obligor  under  part  II,  part  III,  part  IV,  or  part  V or under a local law of the city  imposing a tax on utilities for the preceding year,  provided,  however,  that  for taxable years ending in or with calendar year nineteen hundred  sixty-six, such percentage shall be presumed to be that  percentage,  if  any,  of  the  entire  capital or the issued capital stock, or the gross  direct premiums, or the net income, as the case may be, of the issuer or  obligor thereof required to be allocated within the state on the  report  or reports, if any, required of any such issuer or obligor under the tax  law  or  the  insurance  law for the preceding year, unless the taxpayer  establishes the actual percentage which such  issuer  or  obligor  would  have  been  required  to allocate within the city had part II, part III,  part IV, or part V been in effect for such year, or which such issuer or  obligor did allocate within the city under  a  local  law  of  the  city  imposing a tax on utilities, but without regard to any minimum,    (2) adding together the sum so obtained, and    (3)  dividing  the  result  so obtained by the total of its investment  capital  invested  during  such  period  in  stocks,  bonds  and   other  securities  (other  than  obligations  of  the  United  States  and  its  instrumentalities  and  obligations  of  the  state  of  New  York,  its  political  subdivisions  and  its instrumentalities); provided, however,  that in case any investment capital is invested in any  stock,  bond  or  other  security  during  only  a  portion  of  the period covered by the  report, only such portion of such capital shall be taken  into  account;

  and  provided  further,  that  if  a  taxpayer's  investment  allocation  percentage is zero, interest received on bank accounts,  on  obligations  of the United States and its instrumentalities and on obligations of the  state  of New York, its political subdivisions and its instrumentalities  shall be multiplied by its business allocation percentage; and    (c) add the products so obtained.    (d) At the election of the taxpayer there shall be deducted  from  the  portion  of  its  entire  net income allocated within the city either or  both of the items set  forth  in  subparagraphs  one  and  two  of  this  paragraph, except that only one of such deductions shall be allowed with  respect to any one items of property.    (1)  Depreciation  with  respect  to any property such as described in  subparagraph  three  of  this  paragraph,  not   exceeding   twice   the  depreciation  allowed  with  respect  to  the  same property for federal  income tax purposes. Such deduction shall be allowed only upon condition  that entire net  income  be  computed  without  any  deduction  for  the  depreciation  of  the  same  property,  and  the total of all deductions  allowed pursuant to the preceding sentence in any taxable year or  years  with respect to any property shall not exceed its cost or other basis.    (2)  Expenditures  paid  or  incurred  during the taxable year for the  construction, reconstruction, erection or acquisition  of  any  property  such  as described in subparagraph three of this paragraph which is used  or  to  be  used  for  purposes  of  research  and  development  in  the  experimental  or  laboratory sense. Such purposes shall not be deemed to  include the ordinary testing or inspection of materials or products  for  quality   control,  efficiency  surveys,  management  studies,  consumer  surveys,  advertising,  promotions  or  research  in   connection   with  literary,  historical  or  similar  projects.  Such  deduction  shall be  allowed only on condition that entire net income for  the  taxable  year  and  all  succeeding  taxable years be computed without the deduction of  any such expenditures and without any deduction for depreciation of  the  same  property,  except to the extent that its basis may be attributable  to factors other than such expenditures,  or  in  case  a  deduction  is  allowable  pursuant  to  this  subparagraph  for  only  a  part  of such  expenditures, on condition that any deduction allowed for federal income  tax  purposes  on  account  of  such  expenditures  or  on  account   of  depreciation   of  the  same  property  be  proportionately  reduced  in  computing entire net income for the  taxable  year  and  all  succeeding  taxable  years. With respect to property which is used or to be used for  research and development only in part, or during only part of its useful  life, a proportionate part of such expenditures shall be deductible.  If  all or part of such expenditures with respect to any property shall have  been deducted as provided herein, and such property is used for purposes  other  than research and deve