
    Guttmann Picture Frame Associates et al., Petitioners, v Carol O’Cleireacain, as Finance Commissioner of the City of New York, Respondent.
    [618 NYS2d 781]
   —Determination of respondent Commissioner of the Department of Finance of the City of New York, dated September 8, 1992, which assessed an Unincorporated Business Tax deficiency against petitioners, plus interest and penalties, for the sum of $59,111.04, unanimously confirmed, petition denied and proceeding brought pursuant to CPLR article 78 (transferred by order of Supreme Court, New York County [Seymour Schwartz, JJ, entered on or about May 25, 1993) dismissed without costs or disbursements.

The taxing authority properly applied section 6-4 of the New York City Unincorporated Business Tax Regulations (19 RCNY 28-06) retroactively to the facts of this case (see, Matter of Varrington Corp. v City of N. Y. Dept. of Fin., 201 AD2d 282, lv granted 83 NY2d 758). Tax legislation should be implemented in a manner that gives effect to the economic substance of the transaction (595 Investors Ltd. Partnership v Biderman, 140 Misc 2d 441, 445) and the taxing authority may not be required to acquiesce in the taxpayer’s election of a form for doing business but rather may look to the reality of the tax event and sustain or disregard the effect of the fiction in order to best serve the purposes of the tax statute (Higgins v Smith, 308 US 473; Matter of Chemical Bank v Tally, 94 AD2d 1).

We have considered petitioners’ remaining arguments and find them to be without merit. Concur—Sullivan, J. P., Rosenberger, Ellerin, Kupferman and Williams, JJ.  