101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB0942

 

Introduced , by Rep. Michael J. Madigan

 

SYNOPSIS AS INTRODUCED:
 
65 ILCS 5/8-11-1  from Ch. 24, par. 8-11-1

    Amends the Home Rule Municipal Retailers' Occupation Tax Act in the Illinois Municipal Code. Makes a technical change in a Section authorizing the imposition of the tax.


LRB101 03322 AWJ 48330 b

 

 

A BILL FOR

 

HB0942LRB101 03322 AWJ 48330 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Municipal Code is amended by
5changing Section 8-11-1 as follows:
 
6    (65 ILCS 5/8-11-1)  (from Ch. 24, par. 8-11-1)
7    Sec. 8-11-1. Home Rule Municipal Retailers' Occupation Tax
8Act. The The corporate authorities of a home rule municipality
9may impose a tax upon all persons engaged in the business of
10selling tangible personal property, other than an item of
11tangible personal property titled or registered with an agency
12of this State's government, at retail in the municipality on
13the gross receipts from these sales made in the course of such
14business. If imposed, the tax shall only be imposed in 1/4%
15increments. On and after September 1, 1991, this additional tax
16may not be imposed on the sales of food for human consumption
17that is to be consumed off the premises where it is sold (other
18than alcoholic beverages, soft drinks and food that has been
19prepared for immediate consumption) and prescription and
20nonprescription medicines, drugs, medical appliances and
21insulin, urine testing materials, syringes and needles used by
22diabetics. The tax imposed by a home rule municipality under
23this Section and all civil penalties that may be assessed as an

 

 

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1incident of the tax shall be collected and enforced by the
2State Department of Revenue. The certificate of registration
3that is issued by the Department to a retailer under the
4Retailers' Occupation Tax Act shall permit the retailer to
5engage in a business that is taxable under any ordinance or
6resolution enacted pursuant to this Section without
7registering separately with the Department under such
8ordinance or resolution or under this Section. The Department
9shall have full power to administer and enforce this Section;
10to collect all taxes and penalties due hereunder; to dispose of
11taxes and penalties so collected in the manner hereinafter
12provided; and to determine all rights to credit memoranda
13arising on account of the erroneous payment of tax or penalty
14hereunder. In the administration of, and compliance with, this
15Section the Department and persons who are subject to this
16Section shall have the same rights, remedies, privileges,
17immunities, powers and duties, and be subject to the same
18conditions, restrictions, limitations, penalties and
19definitions of terms, and employ the same modes of procedure,
20as are prescribed in Sections 1, 1a, 1d, 1e, 1f, 1i, 1j, 1k,
211m, 1n, 2 through 2-65 (in respect to all provisions therein
22other than the State rate of tax), 2c, 3 (except as to the
23disposition of taxes and penalties collected), 4, 5, 5a, 5b,
245c, 5d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 6d, 7, 8,
259, 10, 11, 12 and 13 of the Retailers' Occupation Tax Act and
26Section 3-7 of the Uniform Penalty and Interest Act, as fully

 

 

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1as if those provisions were set forth herein.
2    No tax may be imposed by a home rule municipality under
3this Section unless the municipality also imposes a tax at the
4same rate under Section 8-11-5 of this Act.
5    Persons subject to any tax imposed under the authority
6granted in this Section may reimburse themselves for their
7seller's tax liability hereunder by separately stating that tax
8as an additional charge, which charge may be stated in
9combination, in a single amount, with State tax which sellers
10are required to collect under the Use Tax Act, pursuant to such
11bracket schedules as the Department may prescribe.
12    Whenever the Department determines that a refund should be
13made under this Section to a claimant instead of issuing a
14credit memorandum, the Department shall notify the State
15Comptroller, who shall cause the order to be drawn for the
16amount specified and to the person named in the notification
17from the Department. The refund shall be paid by the State
18Treasurer out of the home rule municipal retailers' occupation
19tax fund.
20    The Department shall immediately pay over to the State
21Treasurer, ex officio, as trustee, all taxes and penalties
22collected hereunder.
23    As soon as possible after the first day of each month,
24beginning January 1, 2011, upon certification of the Department
25of Revenue, the Comptroller shall order transferred, and the
26Treasurer shall transfer, to the STAR Bonds Revenue Fund the

 

 

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1local sales tax increment, as defined in the Innovation
2Development and Economy Act, collected under this Section
3during the second preceding calendar month for sales within a
4STAR bond district.
5    After the monthly transfer to the STAR Bonds Revenue Fund,
6on or before the 25th day of each calendar month, the
7Department shall prepare and certify to the Comptroller the
8disbursement of stated sums of money to named municipalities,
9the municipalities to be those from which retailers have paid
10taxes or penalties hereunder to the Department during the
11second preceding calendar month. The amount to be paid to each
12municipality shall be the amount (not including credit
13memoranda) collected hereunder during the second preceding
14calendar month by the Department plus an amount the Department
15determines is necessary to offset any amounts that were
16erroneously paid to a different taxing body, and not including
17an amount equal to the amount of refunds made during the second
18preceding calendar month by the Department on behalf of such
19municipality, and not including any amount that the Department
20determines is necessary to offset any amounts that were payable
21to a different taxing body but were erroneously paid to the
22municipality, and not including any amounts that are
23transferred to the STAR Bonds Revenue Fund, less 1.5% of the
24remainder, which the Department shall transfer into the Tax
25Compliance and Administration Fund. The Department, at the time
26of each monthly disbursement to the municipalities, shall

 

 

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1prepare and certify to the State Comptroller the amount to be
2transferred into the Tax Compliance and Administration Fund
3under this Section. Within 10 days after receipt by the
4Comptroller of the disbursement certification to the
5municipalities and the Tax Compliance and Administration Fund
6provided for in this Section to be given to the Comptroller by
7the Department, the Comptroller shall cause the orders to be
8drawn for the respective amounts in accordance with the
9directions contained in the certification.
10    In addition to the disbursement required by the preceding
11paragraph and in order to mitigate delays caused by
12distribution procedures, an allocation shall, if requested, be
13made within 10 days after January 14, 1991, and in November of
141991 and each year thereafter, to each municipality that
15received more than $500,000 during the preceding fiscal year,
16(July 1 through June 30) whether collected by the municipality
17or disbursed by the Department as required by this Section.
18Within 10 days after January 14, 1991, participating
19municipalities shall notify the Department in writing of their
20intent to participate. In addition, for the initial
21distribution, participating municipalities shall certify to
22the Department the amounts collected by the municipality for
23each month under its home rule occupation and service
24occupation tax during the period July 1, 1989 through June 30,
251990. The allocation within 10 days after January 14, 1991,
26shall be in an amount equal to the monthly average of these

 

 

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1amounts, excluding the 2 months of highest receipts. The
2monthly average for the period of July 1, 1990 through June 30,
31991 will be determined as follows: the amounts collected by
4the municipality under its home rule occupation and service
5occupation tax during the period of July 1, 1990 through
6September 30, 1990, plus amounts collected by the Department
7and paid to such municipality through June 30, 1991, excluding
8the 2 months of highest receipts. The monthly average for each
9subsequent period of July 1 through June 30 shall be an amount
10equal to the monthly distribution made to each such
11municipality under the preceding paragraph during this period,
12excluding the 2 months of highest receipts. The distribution
13made in November 1991 and each year thereafter under this
14paragraph and the preceding paragraph shall be reduced by the
15amount allocated and disbursed under this paragraph in the
16preceding period of July 1 through June 30. The Department
17shall prepare and certify to the Comptroller for disbursement
18the allocations made in accordance with this paragraph.
19    For the purpose of determining the local governmental unit
20whose tax is applicable, a retail sale by a producer of coal or
21other mineral mined in Illinois is a sale at retail at the
22place where the coal or other mineral mined in Illinois is
23extracted from the earth. This paragraph does not apply to coal
24or other mineral when it is delivered or shipped by the seller
25to the purchaser at a point outside Illinois so that the sale
26is exempt under the United States Constitution as a sale in

 

 

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1interstate or foreign commerce.
2    Nothing in this Section shall be construed to authorize a
3municipality to impose a tax upon the privilege of engaging in
4any business which under the Constitution of the United States
5may not be made the subject of taxation by this State.
6    An ordinance or resolution imposing or discontinuing a tax
7hereunder or effecting a change in the rate thereof shall be
8adopted and a certified copy thereof filed with the Department
9on or before the first day of June, whereupon the Department
10shall proceed to administer and enforce this Section as of the
11first day of September next following the adoption and filing.
12Beginning January 1, 1992, an ordinance or resolution imposing
13or discontinuing the tax hereunder or effecting a change in the
14rate thereof shall be adopted and a certified copy thereof
15filed with the Department on or before the first day of July,
16whereupon the Department shall proceed to administer and
17enforce this Section as of the first day of October next
18following such adoption and filing. Beginning January 1, 1993,
19an ordinance or resolution imposing or discontinuing the tax
20hereunder or effecting a change in the rate thereof shall be
21adopted and a certified copy thereof filed with the Department
22on or before the first day of October, whereupon the Department
23shall proceed to administer and enforce this Section as of the
24first day of January next following the adoption and filing.
25However, a municipality located in a county with a population
26in excess of 3,000,000 that elected to become a home rule unit

 

 

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1at the general primary election in 1994 may adopt an ordinance
2or resolution imposing the tax under this Section and file a
3certified copy of the ordinance or resolution with the
4Department on or before July 1, 1994. The Department shall then
5proceed to administer and enforce this Section as of October 1,
61994. Beginning April 1, 1998, an ordinance or resolution
7imposing or discontinuing the tax hereunder or effecting a
8change in the rate thereof shall either (i) be adopted and a
9certified copy thereof filed with the Department on or before
10the first day of April, whereupon the Department shall proceed
11to administer and enforce this Section as of the first day of
12July next following the adoption and filing; or (ii) be adopted
13and a certified copy thereof filed with the Department on or
14before the first day of October, whereupon the Department shall
15proceed to administer and enforce this Section as of the first
16day of January next following the adoption and filing.
17    When certifying the amount of a monthly disbursement to a
18municipality under this Section, the Department shall increase
19or decrease the amount by an amount necessary to offset any
20misallocation of previous disbursements. The offset amount
21shall be the amount erroneously disbursed within the previous 6
22months from the time a misallocation is discovered.
23    Any unobligated balance remaining in the Municipal
24Retailers' Occupation Tax Fund on December 31, 1989, which fund
25was abolished by Public Act 85-1135, and all receipts of
26municipal tax as a result of audits of liability periods prior

 

 

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1to January 1, 1990, shall be paid into the Local Government Tax
2Fund for distribution as provided by this Section prior to the
3enactment of Public Act 85-1135. All receipts of municipal tax
4as a result of an assessment not arising from an audit, for
5liability periods prior to January 1, 1990, shall be paid into
6the Local Government Tax Fund for distribution before July 1,
71990, as provided by this Section prior to the enactment of
8Public Act 85-1135; and on and after July 1, 1990, all such
9receipts shall be distributed as provided in Section 6z-18 of
10the State Finance Act.
11    As used in this Section, "municipal" and "municipality"
12means a city, village or incorporated town, including an
13incorporated town that has superseded a civil township.
14    This Section shall be known and may be cited as the Home
15Rule Municipal Retailers' Occupation Tax Act.
16(Source: P.A. 99-217, eff. 7-31-15; 100-23, eff. 7-6-17;
17100-587, eff. 6-4-18.)