Illinois General Assembly - Full Text of SB3128
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Full Text of SB3128  103rd General Assembly

SB3128 103RD GENERAL ASSEMBLY

 


 
103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB3128

 

Introduced 2/2/2024, by Sen. Emil Jones, III

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-5
35 ILCS 110/3-5
35 ILCS 115/3-5
35 ILCS 120/2-5

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that diapers, baby wipes, car seats, infant formula, and bottles are exempt from the taxes imposed under the Acts.


LRB103 38386 HLH 68521 b

 

 

A BILL FOR

 

SB3128LRB103 38386 HLH 68521 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Section
53-5 as follows:
 
6    (35 ILCS 105/3-5)
7    Sec. 3-5. Exemptions. Use of the following tangible
8personal property is exempt from the tax imposed by this Act:
9    (1) Personal property purchased from a corporation,
10society, association, foundation, institution, or
11organization, other than a limited liability company, that is
12organized and operated as a not-for-profit service enterprise
13for the benefit of persons 65 years of age or older if the
14personal property was not purchased by the enterprise for the
15purpose of resale by the enterprise.
16    (2) Personal property purchased by a not-for-profit
17Illinois county fair association for use in conducting,
18operating, or promoting the county fair.
19    (3) Personal property purchased by a not-for-profit arts
20or cultural organization that establishes, by proof required
21by the Department by rule, that it has received an exemption
22under Section 501(c)(3) of the Internal Revenue Code and that
23is organized and operated primarily for the presentation or

 

 

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1support of arts or cultural programming, activities, or
2services. These organizations include, but are not limited to,
3music and dramatic arts organizations such as symphony
4orchestras and theatrical groups, arts and cultural service
5organizations, local arts councils, visual arts organizations,
6and media arts organizations. On and after July 1, 2001 (the
7effective date of Public Act 92-35), however, an entity
8otherwise eligible for this exemption shall not make tax-free
9purchases unless it has an active identification number issued
10by the Department.
11    (4) Except as otherwise provided in this Act, personal
12property purchased by a governmental body, by a corporation,
13society, association, foundation, or institution organized and
14operated exclusively for charitable, religious, or educational
15purposes, or by a not-for-profit corporation, society,
16association, foundation, institution, or organization that has
17no compensated officers or employees and that is organized and
18operated primarily for the recreation of persons 55 years of
19age or older. A limited liability company may qualify for the
20exemption under this paragraph only if the limited liability
21company is organized and operated exclusively for educational
22purposes. On and after July 1, 1987, however, no entity
23otherwise eligible for this exemption shall make tax-free
24purchases unless it has an active exemption identification
25number issued by the Department.
26    (5) Until July 1, 2003, a passenger car that is a

 

 

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1replacement vehicle to the extent that the purchase price of
2the car is subject to the Replacement Vehicle Tax.
3    (6) Until July 1, 2003 and beginning again on September 1,
42004 through August 30, 2014, graphic arts machinery and
5equipment, including repair and replacement parts, both new
6and used, and including that manufactured on special order,
7certified by the purchaser to be used primarily for graphic
8arts production, and including machinery and equipment
9purchased for lease. Equipment includes chemicals or chemicals
10acting as catalysts but only if the chemicals or chemicals
11acting as catalysts effect a direct and immediate change upon
12a graphic arts product. Beginning on July 1, 2017, graphic
13arts machinery and equipment is included in the manufacturing
14and assembling machinery and equipment exemption under
15paragraph (18).
16    (7) Farm chemicals.
17    (8) Legal tender, currency, medallions, or gold or silver
18coinage issued by the State of Illinois, the government of the
19United States of America, or the government of any foreign
20country, and bullion.
21    (9) Personal property purchased from a teacher-sponsored
22student organization affiliated with an elementary or
23secondary school located in Illinois.
24    (10) A motor vehicle that is used for automobile renting,
25as defined in the Automobile Renting Occupation and Use Tax
26Act.

 

 

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1    (11) Farm machinery and equipment, both new and used,
2including that manufactured on special order, certified by the
3purchaser to be used primarily for production agriculture or
4State or federal agricultural programs, including individual
5replacement parts for the machinery and equipment, including
6machinery and equipment purchased for lease, and including
7implements of husbandry defined in Section 1-130 of the
8Illinois Vehicle Code, farm machinery and agricultural
9chemical and fertilizer spreaders, and nurse wagons required
10to be registered under Section 3-809 of the Illinois Vehicle
11Code, but excluding other motor vehicles required to be
12registered under the Illinois Vehicle Code. Horticultural
13polyhouses or hoop houses used for propagating, growing, or
14overwintering plants shall be considered farm machinery and
15equipment under this item (11). Agricultural chemical tender
16tanks and dry boxes shall include units sold separately from a
17motor vehicle required to be licensed and units sold mounted
18on a motor vehicle required to be licensed if the selling price
19of the tender is separately stated.
20    Farm machinery and equipment shall include precision
21farming equipment that is installed or purchased to be
22installed on farm machinery and equipment, including, but not
23limited to, tractors, harvesters, sprayers, planters, seeders,
24or spreaders. Precision farming equipment includes, but is not
25limited to, soil testing sensors, computers, monitors,
26software, global positioning and mapping systems, and other

 

 

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1such equipment.
2    Farm machinery and equipment also includes computers,
3sensors, software, and related equipment used primarily in the
4computer-assisted operation of production agriculture
5facilities, equipment, and activities such as, but not limited
6to, the collection, monitoring, and correlation of animal and
7crop data for the purpose of formulating animal diets and
8agricultural chemicals.
9    Beginning on January 1, 2024, farm machinery and equipment
10also includes electrical power generation equipment used
11primarily for production agriculture.
12    This item (11) is exempt from the provisions of Section
133-90.
14    (12) Until June 30, 2013, fuel and petroleum products sold
15to or used by an air common carrier, certified by the carrier
16to be used for consumption, shipment, or storage in the
17conduct of its business as an air common carrier, for a flight
18destined for or returning from a location or locations outside
19the United States without regard to previous or subsequent
20domestic stopovers.
21    Beginning July 1, 2013, fuel and petroleum products sold
22to or used by an air carrier, certified by the carrier to be
23used for consumption, shipment, or storage in the conduct of
24its business as an air common carrier, for a flight that (i) is
25engaged in foreign trade or is engaged in trade between the
26United States and any of its possessions and (ii) transports

 

 

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1at least one individual or package for hire from the city of
2origination to the city of final destination on the same
3aircraft, without regard to a change in the flight number of
4that aircraft.
5    (13) Proceeds of mandatory service charges separately
6stated on customers' bills for the purchase and consumption of
7food and beverages purchased at retail from a retailer, to the
8extent that the proceeds of the service charge are in fact
9turned over as tips or as a substitute for tips to the
10employees who participate directly in preparing, serving,
11hosting or cleaning up the food or beverage function with
12respect to which the service charge is imposed.
13    (14) Until July 1, 2003, oil field exploration, drilling,
14and production equipment, including (i) rigs and parts of
15rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
16pipe and tubular goods, including casing and drill strings,
17(iii) pumps and pump-jack units, (iv) storage tanks and flow
18lines, (v) any individual replacement part for oil field
19exploration, drilling, and production equipment, and (vi)
20machinery and equipment purchased for lease; but excluding
21motor vehicles required to be registered under the Illinois
22Vehicle Code.
23    (15) Photoprocessing machinery and equipment, including
24repair and replacement parts, both new and used, including
25that manufactured on special order, certified by the purchaser
26to be used primarily for photoprocessing, and including

 

 

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1photoprocessing machinery and equipment purchased for lease.
2    (16) Until July 1, 2028, coal and aggregate exploration,
3mining, off-highway hauling, processing, maintenance, and
4reclamation equipment, including replacement parts and
5equipment, and including equipment purchased for lease, but
6excluding motor vehicles required to be registered under the
7Illinois Vehicle Code. The changes made to this Section by
8Public Act 97-767 apply on and after July 1, 2003, but no claim
9for credit or refund is allowed on or after August 16, 2013
10(the effective date of Public Act 98-456) for such taxes paid
11during the period beginning July 1, 2003 and ending on August
1216, 2013 (the effective date of Public Act 98-456).
13    (17) Until July 1, 2003, distillation machinery and
14equipment, sold as a unit or kit, assembled or installed by the
15retailer, certified by the user to be used only for the
16production of ethyl alcohol that will be used for consumption
17as motor fuel or as a component of motor fuel for the personal
18use of the user, and not subject to sale or resale.
19    (18) Manufacturing and assembling machinery and equipment
20used primarily in the process of manufacturing or assembling
21tangible personal property for wholesale or retail sale or
22lease, whether that sale or lease is made directly by the
23manufacturer or by some other person, whether the materials
24used in the process are owned by the manufacturer or some other
25person, or whether that sale or lease is made apart from or as
26an incident to the seller's engaging in the service occupation

 

 

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1of producing machines, tools, dies, jigs, patterns, gauges, or
2other similar items of no commercial value on special order
3for a particular purchaser. The exemption provided by this
4paragraph (18) includes production related tangible personal
5property, as defined in Section 3-50, purchased on or after
6July 1, 2019. The exemption provided by this paragraph (18)
7does not include machinery and equipment used in (i) the
8generation of electricity for wholesale or retail sale; (ii)
9the generation or treatment of natural or artificial gas for
10wholesale or retail sale that is delivered to customers
11through pipes, pipelines, or mains; or (iii) the treatment of
12water for wholesale or retail sale that is delivered to
13customers through pipes, pipelines, or mains. The provisions
14of Public Act 98-583 are declaratory of existing law as to the
15meaning and scope of this exemption. Beginning on July 1,
162017, the exemption provided by this paragraph (18) includes,
17but is not limited to, graphic arts machinery and equipment,
18as defined in paragraph (6) of this Section.
19    (19) Personal property delivered to a purchaser or
20purchaser's donee inside Illinois when the purchase order for
21that personal property was received by a florist located
22outside Illinois who has a florist located inside Illinois
23deliver the personal property.
24    (20) Semen used for artificial insemination of livestock
25for direct agricultural production.
26    (21) Horses, or interests in horses, registered with and

 

 

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1meeting the requirements of any of the Arabian Horse Club
2Registry of America, Appaloosa Horse Club, American Quarter
3Horse Association, United States Trotting Association, or
4Jockey Club, as appropriate, used for purposes of breeding or
5racing for prizes. This item (21) is exempt from the
6provisions of Section 3-90, and the exemption provided for
7under this item (21) applies for all periods beginning May 30,
81995, but no claim for credit or refund is allowed on or after
9January 1, 2008 for such taxes paid during the period
10beginning May 30, 2000 and ending on January 1, 2008.
11    (22) Computers and communications equipment utilized for
12any hospital purpose and equipment used in the diagnosis,
13analysis, or treatment of hospital patients purchased by a
14lessor who leases the equipment, under a lease of one year or
15longer executed or in effect at the time the lessor would
16otherwise be subject to the tax imposed by this Act, to a
17hospital that has been issued an active tax exemption
18identification number by the Department under Section 1g of
19the Retailers' Occupation Tax Act. If the equipment is leased
20in a manner that does not qualify for this exemption or is used
21in any other non-exempt manner, the lessor shall be liable for
22the tax imposed under this Act or the Service Use Tax Act, as
23the case may be, based on the fair market value of the property
24at the time the non-qualifying use occurs. No lessor shall
25collect or attempt to collect an amount (however designated)
26that purports to reimburse that lessor for the tax imposed by

 

 

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1this Act or the Service Use Tax Act, as the case may be, if the
2tax has not been paid by the lessor. If a lessor improperly
3collects any such amount from the lessee, the lessee shall
4have a legal right to claim a refund of that amount from the
5lessor. If, however, that amount is not refunded to the lessee
6for any reason, the lessor is liable to pay that amount to the
7Department.
8    (23) Personal property purchased by a lessor who leases
9the property, under a lease of one year or longer executed or
10in effect at the time the lessor would otherwise be subject to
11the tax imposed by this Act, to a governmental body that has
12been issued an active sales tax exemption identification
13number by the Department under Section 1g of the Retailers'
14Occupation Tax Act. If the property is leased in a manner that
15does not qualify for this exemption or used in any other
16non-exempt manner, the lessor shall be liable for the tax
17imposed under this Act or the Service Use Tax Act, as the case
18may be, based on the fair market value of the property at the
19time the non-qualifying use occurs. No lessor shall collect or
20attempt to collect an amount (however designated) that
21purports to reimburse that lessor for the tax imposed by this
22Act or the Service Use Tax Act, as the case may be, if the tax
23has not been paid by the lessor. If a lessor improperly
24collects any such amount from the lessee, the lessee shall
25have a legal right to claim a refund of that amount from the
26lessor. If, however, that amount is not refunded to the lessee

 

 

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1for any reason, the lessor is liable to pay that amount to the
2Department.
3    (24) Beginning with taxable years ending on or after
4December 31, 1995 and ending with taxable years ending on or
5before December 31, 2004, personal property that is donated
6for disaster relief to be used in a State or federally declared
7disaster area in Illinois or bordering Illinois by a
8manufacturer or retailer that is registered in this State to a
9corporation, society, association, foundation, or institution
10that has been issued a sales tax exemption identification
11number by the Department that assists victims of the disaster
12who reside within the declared disaster area.
13    (25) Beginning with taxable years ending on or after
14December 31, 1995 and ending with taxable years ending on or
15before December 31, 2004, personal property that is used in
16the performance of infrastructure repairs in this State,
17including, but not limited to, municipal roads and streets,
18access roads, bridges, sidewalks, waste disposal systems,
19water and sewer line extensions, water distribution and
20purification facilities, storm water drainage and retention
21facilities, and sewage treatment facilities, resulting from a
22State or federally declared disaster in Illinois or bordering
23Illinois when such repairs are initiated on facilities located
24in the declared disaster area within 6 months after the
25disaster.
26    (26) Beginning July 1, 1999, game or game birds purchased

 

 

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1at a "game breeding and hunting preserve area" as that term is
2used in the Wildlife Code. This paragraph is exempt from the
3provisions of Section 3-90.
4    (27) A motor vehicle, as that term is defined in Section
51-146 of the Illinois Vehicle Code, that is donated to a
6corporation, limited liability company, society, association,
7foundation, or institution that is determined by the
8Department to be organized and operated exclusively for
9educational purposes. For purposes of this exemption, "a
10corporation, limited liability company, society, association,
11foundation, or institution organized and operated exclusively
12for educational purposes" means all tax-supported public
13schools, private schools that offer systematic instruction in
14useful branches of learning by methods common to public
15schools and that compare favorably in their scope and
16intensity with the course of study presented in tax-supported
17schools, and vocational or technical schools or institutes
18organized and operated exclusively to provide a course of
19study of not less than 6 weeks duration and designed to prepare
20individuals to follow a trade or to pursue a manual,
21technical, mechanical, industrial, business, or commercial
22occupation.
23    (28) Beginning January 1, 2000, personal property,
24including food, purchased through fundraising events for the
25benefit of a public or private elementary or secondary school,
26a group of those schools, or one or more school districts if

 

 

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1the events are sponsored by an entity recognized by the school
2district that consists primarily of volunteers and includes
3parents and teachers of the school children. This paragraph
4does not apply to fundraising events (i) for the benefit of
5private home instruction or (ii) for which the fundraising
6entity purchases the personal property sold at the events from
7another individual or entity that sold the property for the
8purpose of resale by the fundraising entity and that profits
9from the sale to the fundraising entity. This paragraph is
10exempt from the provisions of Section 3-90.
11    (29) Beginning January 1, 2000 and through December 31,
122001, new or used automatic vending machines that prepare and
13serve hot food and beverages, including coffee, soup, and
14other items, and replacement parts for these machines.
15Beginning January 1, 2002 and through June 30, 2003, machines
16and parts for machines used in commercial, coin-operated
17amusement and vending business if a use or occupation tax is
18paid on the gross receipts derived from the use of the
19commercial, coin-operated amusement and vending machines. This
20paragraph is exempt from the provisions of Section 3-90.
21    (30) Beginning January 1, 2001 and through June 30, 2016,
22food for human consumption that is to be consumed off the
23premises where it is sold (other than alcoholic beverages,
24soft drinks, and food that has been prepared for immediate
25consumption) and prescription and nonprescription medicines,
26drugs, medical appliances, and insulin, urine testing

 

 

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1materials, syringes, and needles used by diabetics, for human
2use, when purchased for use by a person receiving medical
3assistance under Article V of the Illinois Public Aid Code who
4resides in a licensed long-term care facility, as defined in
5the Nursing Home Care Act, or in a licensed facility as defined
6in the ID/DD Community Care Act, the MC/DD Act, or the
7Specialized Mental Health Rehabilitation Act of 2013.
8    (31) Beginning on August 2, 2001 (the effective date of
9Public Act 92-227), computers and communications equipment
10utilized for any hospital purpose and equipment used in the
11diagnosis, analysis, or treatment of hospital patients
12purchased by a lessor who leases the equipment, under a lease
13of one year or longer executed or in effect at the time the
14lessor would otherwise be subject to the tax imposed by this
15Act, to a hospital that has been issued an active tax exemption
16identification number by the Department under Section 1g of
17the Retailers' Occupation Tax Act. If the equipment is leased
18in a manner that does not qualify for this exemption or is used
19in any other nonexempt manner, the lessor shall be liable for
20the tax imposed under this Act or the Service Use Tax Act, as
21the case may be, based on the fair market value of the property
22at the time the nonqualifying use occurs. No lessor shall
23collect or attempt to collect an amount (however designated)
24that purports to reimburse that lessor for the tax imposed by
25this Act or the Service Use Tax Act, as the case may be, if the
26tax has not been paid by the lessor. If a lessor improperly

 

 

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1collects any such amount from the lessee, the lessee shall
2have a legal right to claim a refund of that amount from the
3lessor. If, however, that amount is not refunded to the lessee
4for any reason, the lessor is liable to pay that amount to the
5Department. This paragraph is exempt from the provisions of
6Section 3-90.
7    (32) Beginning on August 2, 2001 (the effective date of
8Public Act 92-227), personal property purchased by a lessor
9who leases the property, under a lease of one year or longer
10executed or in effect at the time the lessor would otherwise be
11subject to the tax imposed by this Act, to a governmental body
12that has been issued an active sales tax exemption
13identification number by the Department under Section 1g of
14the Retailers' Occupation Tax Act. If the property is leased
15in a manner that does not qualify for this exemption or used in
16any other nonexempt manner, the lessor shall be liable for the
17tax imposed under this Act or the Service Use Tax Act, as the
18case may be, based on the fair market value of the property at
19the time the nonqualifying use occurs. No lessor shall collect
20or attempt to collect an amount (however designated) that
21purports to reimburse that lessor for the tax imposed by this
22Act or the Service Use Tax Act, as the case may be, if the tax
23has not been paid by the lessor. If a lessor improperly
24collects any such amount from the lessee, the lessee shall
25have a legal right to claim a refund of that amount from the
26lessor. If, however, that amount is not refunded to the lessee

 

 

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1for any reason, the lessor is liable to pay that amount to the
2Department. This paragraph is exempt from the provisions of
3Section 3-90.
4    (33) On and after July 1, 2003 and through June 30, 2004,
5the use in this State of motor vehicles of the second division
6with a gross vehicle weight in excess of 8,000 pounds and that
7are subject to the commercial distribution fee imposed under
8Section 3-815.1 of the Illinois Vehicle Code. Beginning on
9July 1, 2004 and through June 30, 2005, the use in this State
10of motor vehicles of the second division: (i) with a gross
11vehicle weight rating in excess of 8,000 pounds; (ii) that are
12subject to the commercial distribution fee imposed under
13Section 3-815.1 of the Illinois Vehicle Code; and (iii) that
14are primarily used for commercial purposes. Through June 30,
152005, this exemption applies to repair and replacement parts
16added after the initial purchase of such a motor vehicle if
17that motor vehicle is used in a manner that would qualify for
18the rolling stock exemption otherwise provided for in this
19Act. For purposes of this paragraph, the term "used for
20commercial purposes" means the transportation of persons or
21property in furtherance of any commercial or industrial
22enterprise, whether for-hire or not.
23    (34) Beginning January 1, 2008, tangible personal property
24used in the construction or maintenance of a community water
25supply, as defined under Section 3.145 of the Environmental
26Protection Act, that is operated by a not-for-profit

 

 

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1corporation that holds a valid water supply permit issued
2under Title IV of the Environmental Protection Act. This
3paragraph is exempt from the provisions of Section 3-90.
4    (35) Beginning January 1, 2010 and continuing through
5December 31, 2029, materials, parts, equipment, components,
6and furnishings incorporated into or upon an aircraft as part
7of the modification, refurbishment, completion, replacement,
8repair, or maintenance of the aircraft. This exemption
9includes consumable supplies used in the modification,
10refurbishment, completion, replacement, repair, and
11maintenance of aircraft. However, until January 1, 2024, this
12exemption excludes any materials, parts, equipment,
13components, and consumable supplies used in the modification,
14replacement, repair, and maintenance of aircraft engines or
15power plants, whether such engines or power plants are
16installed or uninstalled upon any such aircraft. "Consumable
17supplies" include, but are not limited to, adhesive, tape,
18sandpaper, general purpose lubricants, cleaning solution,
19latex gloves, and protective films.
20    Beginning January 1, 2010 and continuing through December
2131, 2023, this exemption applies only to the use of qualifying
22tangible personal property by persons who modify, refurbish,
23complete, repair, replace, or maintain aircraft and who (i)
24hold an Air Agency Certificate and are empowered to operate an
25approved repair station by the Federal Aviation
26Administration, (ii) have a Class IV Rating, and (iii) conduct

 

 

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1operations in accordance with Part 145 of the Federal Aviation
2Regulations. From January 1, 2024 through December 31, 2029,
3this exemption applies only to the use of qualifying tangible
4personal property by: (A) persons who modify, refurbish,
5complete, repair, replace, or maintain aircraft and who (i)
6hold an Air Agency Certificate and are empowered to operate an
7approved repair station by the Federal Aviation
8Administration, (ii) have a Class IV Rating, and (iii) conduct
9operations in accordance with Part 145 of the Federal Aviation
10Regulations; and (B) persons who engage in the modification,
11replacement, repair, and maintenance of aircraft engines or
12power plants without regard to whether or not those persons
13meet the qualifications of item (A).
14    The exemption does not include aircraft operated by a
15commercial air carrier providing scheduled passenger air
16service pursuant to authority issued under Part 121 or Part
17129 of the Federal Aviation Regulations. The changes made to
18this paragraph (35) by Public Act 98-534 are declarative of
19existing law. It is the intent of the General Assembly that the
20exemption under this paragraph (35) applies continuously from
21January 1, 2010 through December 31, 2024; however, no claim
22for credit or refund is allowed for taxes paid as a result of
23the disallowance of this exemption on or after January 1, 2015
24and prior to February 5, 2020 (the effective date of Public Act
25101-629).
26    (36) Tangible personal property purchased by a

 

 

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1public-facilities corporation, as described in Section
211-65-10 of the Illinois Municipal Code, for purposes of
3constructing or furnishing a municipal convention hall, but
4only if the legal title to the municipal convention hall is
5transferred to the municipality without any further
6consideration by or on behalf of the municipality at the time
7of the completion of the municipal convention hall or upon the
8retirement or redemption of any bonds or other debt
9instruments issued by the public-facilities corporation in
10connection with the development of the municipal convention
11hall. This exemption includes existing public-facilities
12corporations as provided in Section 11-65-25 of the Illinois
13Municipal Code. This paragraph is exempt from the provisions
14of Section 3-90.
15    (37) Beginning January 1, 2017 and through December 31,
162026, menstrual pads, tampons, and menstrual cups.
17    (38) Merchandise that is subject to the Rental Purchase
18Agreement Occupation and Use Tax. The purchaser must certify
19that the item is purchased to be rented subject to a
20rental-purchase rental purchase agreement, as defined in the
21Rental-Purchase Rental Purchase Agreement Act, and provide
22proof of registration under the Rental Purchase Agreement
23Occupation and Use Tax Act. This paragraph is exempt from the
24provisions of Section 3-90.
25    (39) Tangible personal property purchased by a purchaser
26who is exempt from the tax imposed by this Act by operation of

 

 

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1federal law. This paragraph is exempt from the provisions of
2Section 3-90.
3    (40) Qualified tangible personal property used in the
4construction or operation of a data center that has been
5granted a certificate of exemption by the Department of
6Commerce and Economic Opportunity, whether that tangible
7personal property is purchased by the owner, operator, or
8tenant of the data center or by a contractor or subcontractor
9of the owner, operator, or tenant. Data centers that would
10have qualified for a certificate of exemption prior to January
111, 2020 had Public Act 101-31 been in effect may apply for and
12obtain an exemption for subsequent purchases of computer
13equipment or enabling software purchased or leased to upgrade,
14supplement, or replace computer equipment or enabling software
15purchased or leased in the original investment that would have
16qualified.
17    The Department of Commerce and Economic Opportunity shall
18grant a certificate of exemption under this item (40) to
19qualified data centers as defined by Section 605-1025 of the
20Department of Commerce and Economic Opportunity Law of the
21Civil Administrative Code of Illinois.
22    For the purposes of this item (40):
23        "Data center" means a building or a series of
24    buildings rehabilitated or constructed to house working
25    servers in one physical location or multiple sites within
26    the State of Illinois.

 

 

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1        "Qualified tangible personal property" means:
2    electrical systems and equipment; climate control and
3    chilling equipment and systems; mechanical systems and
4    equipment; monitoring and secure systems; emergency
5    generators; hardware; computers; servers; data storage
6    devices; network connectivity equipment; racks; cabinets;
7    telecommunications cabling infrastructure; raised floor
8    systems; peripheral components or systems; software;
9    mechanical, electrical, or plumbing systems; battery
10    systems; cooling systems and towers; temperature control
11    systems; other cabling; and other data center
12    infrastructure equipment and systems necessary to operate
13    qualified tangible personal property, including fixtures;
14    and component parts of any of the foregoing, including
15    installation, maintenance, repair, refurbishment, and
16    replacement of qualified tangible personal property to
17    generate, transform, transmit, distribute, or manage
18    electricity necessary to operate qualified tangible
19    personal property; and all other tangible personal
20    property that is essential to the operations of a computer
21    data center. The term "qualified tangible personal
22    property" also includes building materials physically
23    incorporated into in to the qualifying data center. To
24    document the exemption allowed under this Section, the
25    retailer must obtain from the purchaser a copy of the
26    certificate of eligibility issued by the Department of

 

 

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1    Commerce and Economic Opportunity.
2    This item (40) is exempt from the provisions of Section
33-90.
4    (41) Beginning July 1, 2022, breast pumps, breast pump
5collection and storage supplies, and breast pump kits. This
6item (41) is exempt from the provisions of Section 3-90. As
7used in this item (41):
8        "Breast pump" means an electrically controlled or
9    manually controlled pump device designed or marketed to be
10    used to express milk from a human breast during lactation,
11    including the pump device and any battery, AC adapter, or
12    other power supply unit that is used to power the pump
13    device and is packaged and sold with the pump device at the
14    time of sale.
15        "Breast pump collection and storage supplies" means
16    items of tangible personal property designed or marketed
17    to be used in conjunction with a breast pump to collect
18    milk expressed from a human breast and to store collected
19    milk until it is ready for consumption.
20        "Breast pump collection and storage supplies"
21    includes, but is not limited to: breast shields and breast
22    shield connectors; breast pump tubes and tubing adapters;
23    breast pump valves and membranes; backflow protectors and
24    backflow protector adaptors; bottles and bottle caps
25    specific to the operation of the breast pump; and breast
26    milk storage bags.

 

 

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1        "Breast pump collection and storage supplies" does not
2    include: (1) bottles and bottle caps not specific to the
3    operation of the breast pump; (2) breast pump travel bags
4    and other similar carrying accessories, including ice
5    packs, labels, and other similar products; (3) breast pump
6    cleaning supplies; (4) nursing bras, bra pads, breast
7    shells, and other similar products; and (5) creams,
8    ointments, and other similar products that relieve
9    breastfeeding-related symptoms or conditions of the
10    breasts or nipples, unless sold as part of a breast pump
11    kit that is pre-packaged by the breast pump manufacturer
12    or distributor.
13        "Breast pump kit" means a kit that: (1) contains no
14    more than a breast pump, breast pump collection and
15    storage supplies, a rechargeable battery for operating the
16    breast pump, a breastmilk cooler, bottle stands, ice
17    packs, and a breast pump carrying case; and (2) is
18    pre-packaged as a breast pump kit by the breast pump
19    manufacturer or distributor.
20    (42) Tangible personal property sold by or on behalf of
21the State Treasurer pursuant to the Revised Uniform Unclaimed
22Property Act. This item (42) is exempt from the provisions of
23Section 3-90.
24    (43) Beginning on January 1, 2024, tangible personal
25property purchased by an active duty member of the armed
26forces of the United States who presents valid military

 

 

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1identification and purchases the property using a form of
2payment where the federal government is the payor. The member
3of the armed forces must complete, at the point of sale, a form
4prescribed by the Department of Revenue documenting that the
5transaction is eligible for the exemption under this
6paragraph. Retailers must keep the form as documentation of
7the exemption in their records for a period of not less than 6
8years. "Armed forces of the United States" means the United
9States Army, Navy, Air Force, Marine Corps, or Coast Guard.
10This paragraph is exempt from the provisions of Section 3-90.
11    (44) Diapers, baby wipes, car seats, infant formula, and
12bottles suitable for feeding infants. This item (43) is exempt
13from the provisions of Section 3-90.
14(Source: P.A. 102-16, eff. 6-17-21; 102-700, Article 70,
15Section 70-5, eff. 4-19-22; 102-700, Article 75, Section 75-5,
16eff. 4-19-22; 102-1026, eff. 5-27-22; 103-9, Article 5,
17Section 5-5, eff. 6-7-23; 103-9, Article 15, Section 15-5,
18eff. 6-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24;
19revised 12-12-23.)
 
20    Section 10. The Service Use Tax Act is amended by changing
21Section 3-5 as follows:
 
22    (35 ILCS 110/3-5)
23    Sec. 3-5. Exemptions. Use of the following tangible
24personal property is exempt from the tax imposed by this Act:

 

 

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1    (1) Personal property purchased from a corporation,
2society, association, foundation, institution, or
3organization, other than a limited liability company, that is
4organized and operated as a not-for-profit service enterprise
5for the benefit of persons 65 years of age or older if the
6personal property was not purchased by the enterprise for the
7purpose of resale by the enterprise.
8    (2) Personal property purchased by a non-profit Illinois
9county fair association for use in conducting, operating, or
10promoting the county fair.
11    (3) Personal property purchased by a not-for-profit arts
12or cultural organization that establishes, by proof required
13by the Department by rule, that it has received an exemption
14under Section 501(c)(3) of the Internal Revenue Code and that
15is organized and operated primarily for the presentation or
16support of arts or cultural programming, activities, or
17services. These organizations include, but are not limited to,
18music and dramatic arts organizations such as symphony
19orchestras and theatrical groups, arts and cultural service
20organizations, local arts councils, visual arts organizations,
21and media arts organizations. On and after July 1, 2001 (the
22effective date of Public Act 92-35), however, an entity
23otherwise eligible for this exemption shall not make tax-free
24purchases unless it has an active identification number issued
25by the Department.
26    (4) Legal tender, currency, medallions, or gold or silver

 

 

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1coinage issued by the State of Illinois, the government of the
2United States of America, or the government of any foreign
3country, and bullion.
4    (5) Until July 1, 2003 and beginning again on September 1,
52004 through August 30, 2014, graphic arts machinery and
6equipment, including repair and replacement parts, both new
7and used, and including that manufactured on special order or
8purchased for lease, certified by the purchaser to be used
9primarily for graphic arts production. Equipment includes
10chemicals or chemicals acting as catalysts but only if the
11chemicals or chemicals acting as catalysts effect a direct and
12immediate change upon a graphic arts product. Beginning on
13July 1, 2017, graphic arts machinery and equipment is included
14in the manufacturing and assembling machinery and equipment
15exemption under Section 2 of this Act.
16    (6) Personal property purchased from a teacher-sponsored
17student organization affiliated with an elementary or
18secondary school located in Illinois.
19    (7) Farm machinery and equipment, both new and used,
20including that manufactured on special order, certified by the
21purchaser to be used primarily for production agriculture or
22State or federal agricultural programs, including individual
23replacement parts for the machinery and equipment, including
24machinery and equipment purchased for lease, and including
25implements of husbandry defined in Section 1-130 of the
26Illinois Vehicle Code, farm machinery and agricultural

 

 

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1chemical and fertilizer spreaders, and nurse wagons required
2to be registered under Section 3-809 of the Illinois Vehicle
3Code, but excluding other motor vehicles required to be
4registered under the Illinois Vehicle Code. Horticultural
5polyhouses or hoop houses used for propagating, growing, or
6overwintering plants shall be considered farm machinery and
7equipment under this item (7). Agricultural chemical tender
8tanks and dry boxes shall include units sold separately from a
9motor vehicle required to be licensed and units sold mounted
10on a motor vehicle required to be licensed if the selling price
11of the tender is separately stated.
12    Farm machinery and equipment shall include precision
13farming equipment that is installed or purchased to be
14installed on farm machinery and equipment, including, but not
15limited to, tractors, harvesters, sprayers, planters, seeders,
16or spreaders. Precision farming equipment includes, but is not
17limited to, soil testing sensors, computers, monitors,
18software, global positioning and mapping systems, and other
19such equipment.
20    Farm machinery and equipment also includes computers,
21sensors, software, and related equipment used primarily in the
22computer-assisted operation of production agriculture
23facilities, equipment, and activities such as, but not limited
24to, the collection, monitoring, and correlation of animal and
25crop data for the purpose of formulating animal diets and
26agricultural chemicals.

 

 

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1    Beginning on January 1, 2024, farm machinery and equipment
2also includes electrical power generation equipment used
3primarily for production agriculture.
4    This item (7) is exempt from the provisions of Section
53-75.
6    (8) Until June 30, 2013, fuel and petroleum products sold
7to or used by an air common carrier, certified by the carrier
8to be used for consumption, shipment, or storage in the
9conduct of its business as an air common carrier, for a flight
10destined for or returning from a location or locations outside
11the United States without regard to previous or subsequent
12domestic stopovers.
13    Beginning July 1, 2013, fuel and petroleum products sold
14to or used by an air carrier, certified by the carrier to be
15used for consumption, shipment, or storage in the conduct of
16its business as an air common carrier, for a flight that (i) is
17engaged in foreign trade or is engaged in trade between the
18United States and any of its possessions and (ii) transports
19at least one individual or package for hire from the city of
20origination to the city of final destination on the same
21aircraft, without regard to a change in the flight number of
22that aircraft.
23    (9) Proceeds of mandatory service charges separately
24stated on customers' bills for the purchase and consumption of
25food and beverages acquired as an incident to the purchase of a
26service from a serviceman, to the extent that the proceeds of

 

 

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1the service charge are in fact turned over as tips or as a
2substitute for tips to the employees who participate directly
3in preparing, serving, hosting or cleaning up the food or
4beverage function with respect to which the service charge is
5imposed.
6    (10) Until July 1, 2003, oil field exploration, drilling,
7and production equipment, including (i) rigs and parts of
8rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
9pipe and tubular goods, including casing and drill strings,
10(iii) pumps and pump-jack units, (iv) storage tanks and flow
11lines, (v) any individual replacement part for oil field
12exploration, drilling, and production equipment, and (vi)
13machinery and equipment purchased for lease; but excluding
14motor vehicles required to be registered under the Illinois
15Vehicle Code.
16    (11) Proceeds from the sale of photoprocessing machinery
17and equipment, including repair and replacement parts, both
18new and used, including that manufactured on special order,
19certified by the purchaser to be used primarily for
20photoprocessing, and including photoprocessing machinery and
21equipment purchased for lease.
22    (12) Until July 1, 2028, coal and aggregate exploration,
23mining, off-highway hauling, processing, maintenance, and
24reclamation equipment, including replacement parts and
25equipment, and including equipment purchased for lease, but
26excluding motor vehicles required to be registered under the

 

 

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1Illinois Vehicle Code. The changes made to this Section by
2Public Act 97-767 apply on and after July 1, 2003, but no claim
3for credit or refund is allowed on or after August 16, 2013
4(the effective date of Public Act 98-456) for such taxes paid
5during the period beginning July 1, 2003 and ending on August
616, 2013 (the effective date of Public Act 98-456).
7    (13) Semen used for artificial insemination of livestock
8for direct agricultural production.
9    (14) Horses, or interests in horses, registered with and
10meeting the requirements of any of the Arabian Horse Club
11Registry of America, Appaloosa Horse Club, American Quarter
12Horse Association, United States Trotting Association, or
13Jockey Club, as appropriate, used for purposes of breeding or
14racing for prizes. This item (14) is exempt from the
15provisions of Section 3-75, and the exemption provided for
16under this item (14) applies for all periods beginning May 30,
171995, but no claim for credit or refund is allowed on or after
18January 1, 2008 (the effective date of Public Act 95-88) for
19such taxes paid during the period beginning May 30, 2000 and
20ending on January 1, 2008 (the effective date of Public Act
2195-88).
22    (15) Computers and communications equipment utilized for
23any hospital purpose and equipment used in the diagnosis,
24analysis, or treatment of hospital patients purchased by a
25lessor who leases the equipment, under a lease of one year or
26longer executed or in effect at the time the lessor would

 

 

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1otherwise be subject to the tax imposed by this Act, to a
2hospital that has been issued an active tax exemption
3identification number by the Department under Section 1g of
4the Retailers' Occupation Tax Act. If the equipment is leased
5in a manner that does not qualify for this exemption or is used
6in any other non-exempt manner, the lessor shall be liable for
7the tax imposed under this Act or the Use Tax Act, as the case
8may be, based on the fair market value of the property at the
9time the non-qualifying use occurs. No lessor shall collect or
10attempt to collect an amount (however designated) that
11purports to reimburse that lessor for the tax imposed by this
12Act or the Use Tax Act, as the case may be, if the tax has not
13been paid by the lessor. If a lessor improperly collects any
14such amount from the lessee, the lessee shall have a legal
15right to claim a refund of that amount from the lessor. If,
16however, that amount is not refunded to the lessee for any
17reason, the lessor is liable to pay that amount to the
18Department.
19    (16) Personal property purchased by a lessor who leases
20the property, under a lease of one year or longer executed or
21in effect at the time the lessor would otherwise be subject to
22the tax imposed by this Act, to a governmental body that has
23been issued an active tax exemption identification number by
24the Department under Section 1g of the Retailers' Occupation
25Tax Act. If the property is leased in a manner that does not
26qualify for this exemption or is used in any other non-exempt

 

 

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1manner, the lessor shall be liable for the tax imposed under
2this Act or the Use Tax Act, as the case may be, based on the
3fair market value of the property at the time the
4non-qualifying use occurs. No lessor shall collect or attempt
5to collect an amount (however designated) that purports to
6reimburse that lessor for the tax imposed by this Act or the
7Use Tax Act, as the case may be, if the tax has not been paid
8by the lessor. If a lessor improperly collects any such amount
9from the lessee, the lessee shall have a legal right to claim a
10refund of that amount from the lessor. If, however, that
11amount is not refunded to the lessee for any reason, the lessor
12is liable to pay that amount to the Department.
13    (17) Beginning with taxable years ending on or after
14December 31, 1995 and ending with taxable years ending on or
15before December 31, 2004, personal property that is donated
16for disaster relief to be used in a State or federally declared
17disaster area in Illinois or bordering Illinois by a
18manufacturer or retailer that is registered in this State to a
19corporation, society, association, foundation, or institution
20that has been issued a sales tax exemption identification
21number by the Department that assists victims of the disaster
22who reside within the declared disaster area.
23    (18) Beginning with taxable years ending on or after
24December 31, 1995 and ending with taxable years ending on or
25before December 31, 2004, personal property that is used in
26the performance of infrastructure repairs in this State,

 

 

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1including, but not limited to, municipal roads and streets,
2access roads, bridges, sidewalks, waste disposal systems,
3water and sewer line extensions, water distribution and
4purification facilities, storm water drainage and retention
5facilities, and sewage treatment facilities, resulting from a
6State or federally declared disaster in Illinois or bordering
7Illinois when such repairs are initiated on facilities located
8in the declared disaster area within 6 months after the
9disaster.
10    (19) Beginning July 1, 1999, game or game birds purchased
11at a "game breeding and hunting preserve area" as that term is
12used in the Wildlife Code. This paragraph is exempt from the
13provisions of Section 3-75.
14    (20) A motor vehicle, as that term is defined in Section
151-146 of the Illinois Vehicle Code, that is donated to a
16corporation, limited liability company, society, association,
17foundation, or institution that is determined by the
18Department to be organized and operated exclusively for
19educational purposes. For purposes of this exemption, "a
20corporation, limited liability company, society, association,
21foundation, or institution organized and operated exclusively
22for educational purposes" means all tax-supported public
23schools, private schools that offer systematic instruction in
24useful branches of learning by methods common to public
25schools and that compare favorably in their scope and
26intensity with the course of study presented in tax-supported

 

 

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1schools, and vocational or technical schools or institutes
2organized and operated exclusively to provide a course of
3study of not less than 6 weeks duration and designed to prepare
4individuals to follow a trade or to pursue a manual,
5technical, mechanical, industrial, business, or commercial
6occupation.
7    (21) Beginning January 1, 2000, personal property,
8including food, purchased through fundraising events for the
9benefit of a public or private elementary or secondary school,
10a group of those schools, or one or more school districts if
11the events are sponsored by an entity recognized by the school
12district that consists primarily of volunteers and includes
13parents and teachers of the school children. This paragraph
14does not apply to fundraising events (i) for the benefit of
15private home instruction or (ii) for which the fundraising
16entity purchases the personal property sold at the events from
17another individual or entity that sold the property for the
18purpose of resale by the fundraising entity and that profits
19from the sale to the fundraising entity. This paragraph is
20exempt from the provisions of Section 3-75.
21    (22) Beginning January 1, 2000 and through December 31,
222001, new or used automatic vending machines that prepare and
23serve hot food and beverages, including coffee, soup, and
24other items, and replacement parts for these machines.
25Beginning January 1, 2002 and through June 30, 2003, machines
26and parts for machines used in commercial, coin-operated

 

 

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1amusement and vending business if a use or occupation tax is
2paid on the gross receipts derived from the use of the
3commercial, coin-operated amusement and vending machines. This
4paragraph is exempt from the provisions of Section 3-75.
5    (23) Beginning August 23, 2001 and through June 30, 2016,
6food for human consumption that is to be consumed off the
7premises where it is sold (other than alcoholic beverages,
8soft drinks, and food that has been prepared for immediate
9consumption) and prescription and nonprescription medicines,
10drugs, medical appliances, and insulin, urine testing
11materials, syringes, and needles used by diabetics, for human
12use, when purchased for use by a person receiving medical
13assistance under Article V of the Illinois Public Aid Code who
14resides in a licensed long-term care facility, as defined in
15the Nursing Home Care Act, or in a licensed facility as defined
16in the ID/DD Community Care Act, the MC/DD Act, or the
17Specialized Mental Health Rehabilitation Act of 2013.
18    (24) Beginning on August 2, 2001 (the effective date of
19Public Act 92-227), computers and communications equipment
20utilized for any hospital purpose and equipment used in the
21diagnosis, analysis, or treatment of hospital patients
22purchased by a lessor who leases the equipment, under a lease
23of one year or longer executed or in effect at the time the
24lessor would otherwise be subject to the tax imposed by this
25Act, to a hospital that has been issued an active tax exemption
26identification number by the Department under Section 1g of

 

 

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1the Retailers' Occupation Tax Act. If the equipment is leased
2in a manner that does not qualify for this exemption or is used
3in any other nonexempt manner, the lessor shall be liable for
4the tax imposed under this Act or the Use Tax Act, as the case
5may be, based on the fair market value of the property at the
6time the nonqualifying use occurs. No lessor shall collect or
7attempt to collect an amount (however designated) that
8purports to reimburse that lessor for the tax imposed by this
9Act or the Use Tax Act, as the case may be, if the tax has not
10been paid by the lessor. If a lessor improperly collects any
11such amount from the lessee, the lessee shall have a legal
12right to claim a refund of that amount from the lessor. If,
13however, that amount is not refunded to the lessee for any
14reason, the lessor is liable to pay that amount to the
15Department. This paragraph is exempt from the provisions of
16Section 3-75.
17    (25) Beginning on August 2, 2001 (the effective date of
18Public Act 92-227), personal property purchased by a lessor
19who leases the property, under a lease of one year or longer
20executed or in effect at the time the lessor would otherwise be
21subject to the tax imposed by this Act, to a governmental body
22that has been issued an active tax exemption identification
23number by the Department under Section 1g of the Retailers'
24Occupation Tax Act. If the property is leased in a manner that
25does not qualify for this exemption or is used in any other
26nonexempt manner, the lessor shall be liable for the tax

 

 

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1imposed under this Act or the Use Tax Act, as the case may be,
2based on the fair market value of the property at the time the
3nonqualifying use occurs. No lessor shall collect or attempt
4to collect an amount (however designated) that purports to
5reimburse that lessor for the tax imposed by this Act or the
6Use Tax Act, as the case may be, if the tax has not been paid
7by the lessor. If a lessor improperly collects any such amount
8from the lessee, the lessee shall have a legal right to claim a
9refund of that amount from the lessor. If, however, that
10amount is not refunded to the lessee for any reason, the lessor
11is liable to pay that amount to the Department. This paragraph
12is exempt from the provisions of Section 3-75.
13    (26) Beginning January 1, 2008, tangible personal property
14used in the construction or maintenance of a community water
15supply, as defined under Section 3.145 of the Environmental
16Protection Act, that is operated by a not-for-profit
17corporation that holds a valid water supply permit issued
18under Title IV of the Environmental Protection Act. This
19paragraph is exempt from the provisions of Section 3-75.
20    (27) Beginning January 1, 2010 and continuing through
21December 31, 2029, materials, parts, equipment, components,
22and furnishings incorporated into or upon an aircraft as part
23of the modification, refurbishment, completion, replacement,
24repair, or maintenance of the aircraft. This exemption
25includes consumable supplies used in the modification,
26refurbishment, completion, replacement, repair, and

 

 

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1maintenance of aircraft. However, until January 1, 2024, this
2exemption excludes any materials, parts, equipment,
3components, and consumable supplies used in the modification,
4replacement, repair, and maintenance of aircraft engines or
5power plants, whether such engines or power plants are
6installed or uninstalled upon any such aircraft. "Consumable
7supplies" include, but are not limited to, adhesive, tape,
8sandpaper, general purpose lubricants, cleaning solution,
9latex gloves, and protective films.
10    Beginning January 1, 2010 and continuing through December
1131, 2023, this exemption applies only to the use of qualifying
12tangible personal property transferred incident to the
13modification, refurbishment, completion, replacement, repair,
14or maintenance of aircraft by persons who (i) hold an Air
15Agency Certificate and are empowered to operate an approved
16repair station by the Federal Aviation Administration, (ii)
17have a Class IV Rating, and (iii) conduct operations in
18accordance with Part 145 of the Federal Aviation Regulations.
19From January 1, 2024 through December 31, 2029, this exemption
20applies only to the use of qualifying tangible personal
21property by: (A) persons who modify, refurbish, complete,
22repair, replace, or maintain aircraft and who (i) hold an Air
23Agency Certificate and are empowered to operate an approved
24repair station by the Federal Aviation Administration, (ii)
25have a Class IV Rating, and (iii) conduct operations in
26accordance with Part 145 of the Federal Aviation Regulations;

 

 

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1and (B) persons who engage in the modification, replacement,
2repair, and maintenance of aircraft engines or power plants
3without regard to whether or not those persons meet the
4qualifications of item (A).
5    The exemption does not include aircraft operated by a
6commercial air carrier providing scheduled passenger air
7service pursuant to authority issued under Part 121 or Part
8129 of the Federal Aviation Regulations. The changes made to
9this paragraph (27) by Public Act 98-534 are declarative of
10existing law. It is the intent of the General Assembly that the
11exemption under this paragraph (27) applies continuously from
12January 1, 2010 through December 31, 2024; however, no claim
13for credit or refund is allowed for taxes paid as a result of
14the disallowance of this exemption on or after January 1, 2015
15and prior to February 5, 2020 (the effective date of Public Act
16101-629).
17    (28) Tangible personal property purchased by a
18public-facilities corporation, as described in Section
1911-65-10 of the Illinois Municipal Code, for purposes of
20constructing or furnishing a municipal convention hall, but
21only if the legal title to the municipal convention hall is
22transferred to the municipality without any further
23consideration by or on behalf of the municipality at the time
24of the completion of the municipal convention hall or upon the
25retirement or redemption of any bonds or other debt
26instruments issued by the public-facilities corporation in

 

 

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1connection with the development of the municipal convention
2hall. This exemption includes existing public-facilities
3corporations as provided in Section 11-65-25 of the Illinois
4Municipal Code. This paragraph is exempt from the provisions
5of Section 3-75.
6    (29) Beginning January 1, 2017 and through December 31,
72026, menstrual pads, tampons, and menstrual cups.
8    (30) Tangible personal property transferred to a purchaser
9who is exempt from the tax imposed by this Act by operation of
10federal law. This paragraph is exempt from the provisions of
11Section 3-75.
12    (31) Qualified tangible personal property used in the
13construction or operation of a data center that has been
14granted a certificate of exemption by the Department of
15Commerce and Economic Opportunity, whether that tangible
16personal property is purchased by the owner, operator, or
17tenant of the data center or by a contractor or subcontractor
18of the owner, operator, or tenant. Data centers that would
19have qualified for a certificate of exemption prior to January
201, 2020 had Public Act 101-31 been in effect, may apply for and
21obtain an exemption for subsequent purchases of computer
22equipment or enabling software purchased or leased to upgrade,
23supplement, or replace computer equipment or enabling software
24purchased or leased in the original investment that would have
25qualified.
26    The Department of Commerce and Economic Opportunity shall

 

 

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1grant a certificate of exemption under this item (31) to
2qualified data centers as defined by Section 605-1025 of the
3Department of Commerce and Economic Opportunity Law of the
4Civil Administrative Code of Illinois.
5    For the purposes of this item (31):
6        "Data center" means a building or a series of
7    buildings rehabilitated or constructed to house working
8    servers in one physical location or multiple sites within
9    the State of Illinois.
10        "Qualified tangible personal property" means:
11    electrical systems and equipment; climate control and
12    chilling equipment and systems; mechanical systems and
13    equipment; monitoring and secure systems; emergency
14    generators; hardware; computers; servers; data storage
15    devices; network connectivity equipment; racks; cabinets;
16    telecommunications cabling infrastructure; raised floor
17    systems; peripheral components or systems; software;
18    mechanical, electrical, or plumbing systems; battery
19    systems; cooling systems and towers; temperature control
20    systems; other cabling; and other data center
21    infrastructure equipment and systems necessary to operate
22    qualified tangible personal property, including fixtures;
23    and component parts of any of the foregoing, including
24    installation, maintenance, repair, refurbishment, and
25    replacement of qualified tangible personal property to
26    generate, transform, transmit, distribute, or manage

 

 

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1    electricity necessary to operate qualified tangible
2    personal property; and all other tangible personal
3    property that is essential to the operations of a computer
4    data center. The term "qualified tangible personal
5    property" also includes building materials physically
6    incorporated into in to the qualifying data center. To
7    document the exemption allowed under this Section, the
8    retailer must obtain from the purchaser a copy of the
9    certificate of eligibility issued by the Department of
10    Commerce and Economic Opportunity.
11    This item (31) is exempt from the provisions of Section
123-75.
13    (32) Beginning July 1, 2022, breast pumps, breast pump
14collection and storage supplies, and breast pump kits. This
15item (32) is exempt from the provisions of Section 3-75. As
16used in this item (32):
17        "Breast pump" means an electrically controlled or
18    manually controlled pump device designed or marketed to be
19    used to express milk from a human breast during lactation,
20    including the pump device and any battery, AC adapter, or
21    other power supply unit that is used to power the pump
22    device and is packaged and sold with the pump device at the
23    time of sale.
24        "Breast pump collection and storage supplies" means
25    items of tangible personal property designed or marketed
26    to be used in conjunction with a breast pump to collect

 

 

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1    milk expressed from a human breast and to store collected
2    milk until it is ready for consumption.
3        "Breast pump collection and storage supplies"
4    includes, but is not limited to: breast shields and breast
5    shield connectors; breast pump tubes and tubing adapters;
6    breast pump valves and membranes; backflow protectors and
7    backflow protector adaptors; bottles and bottle caps
8    specific to the operation of the breast pump; and breast
9    milk storage bags.
10        "Breast pump collection and storage supplies" does not
11    include: (1) bottles and bottle caps not specific to the
12    operation of the breast pump; (2) breast pump travel bags
13    and other similar carrying accessories, including ice
14    packs, labels, and other similar products; (3) breast pump
15    cleaning supplies; (4) nursing bras, bra pads, breast
16    shells, and other similar products; and (5) creams,
17    ointments, and other similar products that relieve
18    breastfeeding-related symptoms or conditions of the
19    breasts or nipples, unless sold as part of a breast pump
20    kit that is pre-packaged by the breast pump manufacturer
21    or distributor.
22        "Breast pump kit" means a kit that: (1) contains no
23    more than a breast pump, breast pump collection and
24    storage supplies, a rechargeable battery for operating the
25    breast pump, a breastmilk cooler, bottle stands, ice
26    packs, and a breast pump carrying case; and (2) is

 

 

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1    pre-packaged as a breast pump kit by the breast pump
2    manufacturer or distributor.
3    (33) Tangible personal property sold by or on behalf of
4the State Treasurer pursuant to the Revised Uniform Unclaimed
5Property Act. This item (33) is exempt from the provisions of
6Section 3-75.
7    (34) Beginning on January 1, 2024, tangible personal
8property purchased by an active duty member of the armed
9forces of the United States who presents valid military
10identification and purchases the property using a form of
11payment where the federal government is the payor. The member
12of the armed forces must complete, at the point of sale, a form
13prescribed by the Department of Revenue documenting that the
14transaction is eligible for the exemption under this
15paragraph. Retailers must keep the form as documentation of
16the exemption in their records for a period of not less than 6
17years. "Armed forces of the United States" means the United
18States Army, Navy, Air Force, Marine Corps, or Coast Guard.
19This paragraph is exempt from the provisions of Section 3-75.
20    (35) Diapers, baby wipes, car seats, infant formula, and
21bottles suitable for feeding infants. This item (35) is exempt
22from the provisions of Section 3-75.
23(Source: P.A. 102-16, eff. 6-17-21; 102-700, Article 70,
24Section 70-10, eff. 4-19-22; 102-700, Article 75, Section
2575-10, eff. 4-19-22; 102-1026, eff. 5-27-22; 103-9, Article 5,
26Section 5-10, eff. 6-7-23; 103-9, Article 15, Section 15-10,

 

 

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1eff. 6-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24;
2revised 12-12-23.)
 
3    Section 15. The Service Occupation Tax Act is amended by
4changing Section 3-5 as follows:
 
5    (35 ILCS 115/3-5)
6    Sec. 3-5. Exemptions. The following tangible personal
7property is exempt from the tax imposed by this Act:
8    (1) Personal property sold by a corporation, society,
9association, foundation, institution, or organization, other
10than a limited liability company, that is organized and
11operated as a not-for-profit service enterprise for the
12benefit of persons 65 years of age or older if the personal
13property was not purchased by the enterprise for the purpose
14of resale by the enterprise.
15    (2) Personal property purchased by a not-for-profit
16Illinois county fair association for use in conducting,
17operating, or promoting the county fair.
18    (3) Personal property purchased by any not-for-profit arts
19or cultural organization that establishes, by proof required
20by the Department by rule, that it has received an exemption
21under Section 501(c)(3) of the Internal Revenue Code and that
22is organized and operated primarily for the presentation or
23support of arts or cultural programming, activities, or
24services. These organizations include, but are not limited to,

 

 

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1music and dramatic arts organizations such as symphony
2orchestras and theatrical groups, arts and cultural service
3organizations, local arts councils, visual arts organizations,
4and media arts organizations. On and after July 1, 2001 (the
5effective date of Public Act 92-35), however, an entity
6otherwise eligible for this exemption shall not make tax-free
7purchases unless it has an active identification number issued
8by the Department.
9    (4) Legal tender, currency, medallions, or gold or silver
10coinage issued by the State of Illinois, the government of the
11United States of America, or the government of any foreign
12country, and bullion.
13    (5) Until July 1, 2003 and beginning again on September 1,
142004 through August 30, 2014, graphic arts machinery and
15equipment, including repair and replacement parts, both new
16and used, and including that manufactured on special order or
17purchased for lease, certified by the purchaser to be used
18primarily for graphic arts production. Equipment includes
19chemicals or chemicals acting as catalysts but only if the
20chemicals or chemicals acting as catalysts effect a direct and
21immediate change upon a graphic arts product. Beginning on
22July 1, 2017, graphic arts machinery and equipment is included
23in the manufacturing and assembling machinery and equipment
24exemption under Section 2 of this Act.
25    (6) Personal property sold by a teacher-sponsored student
26organization affiliated with an elementary or secondary school

 

 

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1located in Illinois.
2    (7) Farm machinery and equipment, both new and used,
3including that manufactured on special order, certified by the
4purchaser to be used primarily for production agriculture or
5State or federal agricultural programs, including individual
6replacement parts for the machinery and equipment, including
7machinery and equipment purchased for lease, and including
8implements of husbandry defined in Section 1-130 of the
9Illinois Vehicle Code, farm machinery and agricultural
10chemical and fertilizer spreaders, and nurse wagons required
11to be registered under Section 3-809 of the Illinois Vehicle
12Code, but excluding other motor vehicles required to be
13registered under the Illinois Vehicle Code. Horticultural
14polyhouses or hoop houses used for propagating, growing, or
15overwintering plants shall be considered farm machinery and
16equipment under this item (7). Agricultural chemical tender
17tanks and dry boxes shall include units sold separately from a
18motor vehicle required to be licensed and units sold mounted
19on a motor vehicle required to be licensed if the selling price
20of the tender is separately stated.
21    Farm machinery and equipment shall include precision
22farming equipment that is installed or purchased to be
23installed on farm machinery and equipment, including, but not
24limited to, tractors, harvesters, sprayers, planters, seeders,
25or spreaders. Precision farming equipment includes, but is not
26limited to, soil testing sensors, computers, monitors,

 

 

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1software, global positioning and mapping systems, and other
2such equipment.
3    Farm machinery and equipment also includes computers,
4sensors, software, and related equipment used primarily in the
5computer-assisted operation of production agriculture
6facilities, equipment, and activities such as, but not limited
7to, the collection, monitoring, and correlation of animal and
8crop data for the purpose of formulating animal diets and
9agricultural chemicals.
10    Beginning on January 1, 2024, farm machinery and equipment
11also includes electrical power generation equipment used
12primarily for production agriculture.
13    This item (7) is exempt from the provisions of Section
143-55.
15    (8) Until June 30, 2013, fuel and petroleum products sold
16to or used by an air common carrier, certified by the carrier
17to be used for consumption, shipment, or storage in the
18conduct of its business as an air common carrier, for a flight
19destined for or returning from a location or locations outside
20the United States without regard to previous or subsequent
21domestic stopovers.
22    Beginning July 1, 2013, fuel and petroleum products sold
23to or used by an air carrier, certified by the carrier to be
24used for consumption, shipment, or storage in the conduct of
25its business as an air common carrier, for a flight that (i) is
26engaged in foreign trade or is engaged in trade between the

 

 

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1United States and any of its possessions and (ii) transports
2at least one individual or package for hire from the city of
3origination to the city of final destination on the same
4aircraft, without regard to a change in the flight number of
5that aircraft.
6    (9) Proceeds of mandatory service charges separately
7stated on customers' bills for the purchase and consumption of
8food and beverages, to the extent that the proceeds of the
9service charge are in fact turned over as tips or as a
10substitute for tips to the employees who participate directly
11in preparing, serving, hosting or cleaning up the food or
12beverage function with respect to which the service charge is
13imposed.
14    (10) Until July 1, 2003, oil field exploration, drilling,
15and production equipment, including (i) rigs and parts of
16rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
17pipe and tubular goods, including casing and drill strings,
18(iii) pumps and pump-jack units, (iv) storage tanks and flow
19lines, (v) any individual replacement part for oil field
20exploration, drilling, and production equipment, and (vi)
21machinery and equipment purchased for lease; but excluding
22motor vehicles required to be registered under the Illinois
23Vehicle Code.
24    (11) Photoprocessing machinery and equipment, including
25repair and replacement parts, both new and used, including
26that manufactured on special order, certified by the purchaser

 

 

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1to be used primarily for photoprocessing, and including
2photoprocessing machinery and equipment purchased for lease.
3    (12) Until July 1, 2028, coal and aggregate exploration,
4mining, off-highway hauling, processing, maintenance, and
5reclamation equipment, including replacement parts and
6equipment, and including equipment purchased for lease, but
7excluding motor vehicles required to be registered under the
8Illinois Vehicle Code. The changes made to this Section by
9Public Act 97-767 apply on and after July 1, 2003, but no claim
10for credit or refund is allowed on or after August 16, 2013
11(the effective date of Public Act 98-456) for such taxes paid
12during the period beginning July 1, 2003 and ending on August
1316, 2013 (the effective date of Public Act 98-456).
14    (13) Beginning January 1, 1992 and through June 30, 2016,
15food for human consumption that is to be consumed off the
16premises where it is sold (other than alcoholic beverages,
17soft drinks and food that has been prepared for immediate
18consumption) and prescription and non-prescription medicines,
19drugs, medical appliances, and insulin, urine testing
20materials, syringes, and needles used by diabetics, for human
21use, when purchased for use by a person receiving medical
22assistance under Article V of the Illinois Public Aid Code who
23resides in a licensed long-term care facility, as defined in
24the Nursing Home Care Act, or in a licensed facility as defined
25in the ID/DD Community Care Act, the MC/DD Act, or the
26Specialized Mental Health Rehabilitation Act of 2013.

 

 

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1    (14) Semen used for artificial insemination of livestock
2for direct agricultural production.
3    (15) Horses, or interests in horses, registered with and
4meeting the requirements of any of the Arabian Horse Club
5Registry of America, Appaloosa Horse Club, American Quarter
6Horse Association, United States Trotting Association, or
7Jockey Club, as appropriate, used for purposes of breeding or
8racing for prizes. This item (15) is exempt from the
9provisions of Section 3-55, and the exemption provided for
10under this item (15) applies for all periods beginning May 30,
111995, but no claim for credit or refund is allowed on or after
12January 1, 2008 (the effective date of Public Act 95-88) for
13such taxes paid during the period beginning May 30, 2000 and
14ending on January 1, 2008 (the effective date of Public Act
1595-88).
16    (16) Computers and communications equipment utilized for
17any hospital purpose and equipment used in the diagnosis,
18analysis, or treatment of hospital patients sold to a lessor
19who leases the equipment, under a lease of one year or longer
20executed or in effect at the time of the purchase, to a
21hospital that has been issued an active tax exemption
22identification number by the Department under Section 1g of
23the Retailers' Occupation Tax Act.
24    (17) Personal property sold to a lessor who leases the
25property, under a lease of one year or longer executed or in
26effect at the time of the purchase, to a governmental body that

 

 

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1has been issued an active tax exemption identification number
2by the Department under Section 1g of the Retailers'
3Occupation Tax Act.
4    (18) Beginning with taxable years ending on or after
5December 31, 1995 and ending with taxable years ending on or
6before December 31, 2004, personal property that is donated
7for disaster relief to be used in a State or federally declared
8disaster area in Illinois or bordering Illinois by a
9manufacturer or retailer that is registered in this State to a
10corporation, society, association, foundation, or institution
11that has been issued a sales tax exemption identification
12number by the Department that assists victims of the disaster
13who reside within the declared disaster area.
14    (19) Beginning with taxable years ending on or after
15December 31, 1995 and ending with taxable years ending on or
16before December 31, 2004, personal property that is used in
17the performance of infrastructure repairs in this State,
18including, but not limited to, municipal roads and streets,
19access roads, bridges, sidewalks, waste disposal systems,
20water and sewer line extensions, water distribution and
21purification facilities, storm water drainage and retention
22facilities, and sewage treatment facilities, resulting from a
23State or federally declared disaster in Illinois or bordering
24Illinois when such repairs are initiated on facilities located
25in the declared disaster area within 6 months after the
26disaster.

 

 

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1    (20) Beginning July 1, 1999, game or game birds sold at a
2"game breeding and hunting preserve area" as that term is used
3in the Wildlife Code. This paragraph is exempt from the
4provisions of Section 3-55.
5    (21) A motor vehicle, as that term is defined in Section
61-146 of the Illinois Vehicle Code, that is donated to a
7corporation, limited liability company, society, association,
8foundation, or institution that is determined by the
9Department to be organized and operated exclusively for
10educational purposes. For purposes of this exemption, "a
11corporation, limited liability company, society, association,
12foundation, or institution organized and operated exclusively
13for educational purposes" means all tax-supported public
14schools, private schools that offer systematic instruction in
15useful branches of learning by methods common to public
16schools and that compare favorably in their scope and
17intensity with the course of study presented in tax-supported
18schools, and vocational or technical schools or institutes
19organized and operated exclusively to provide a course of
20study of not less than 6 weeks duration and designed to prepare
21individuals to follow a trade or to pursue a manual,
22technical, mechanical, industrial, business, or commercial
23occupation.
24    (22) Beginning January 1, 2000, personal property,
25including food, purchased through fundraising events for the
26benefit of a public or private elementary or secondary school,

 

 

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1a group of those schools, or one or more school districts if
2the events are sponsored by an entity recognized by the school
3district that consists primarily of volunteers and includes
4parents and teachers of the school children. This paragraph
5does not apply to fundraising events (i) for the benefit of
6private home instruction or (ii) for which the fundraising
7entity purchases the personal property sold at the events from
8another individual or entity that sold the property for the
9purpose of resale by the fundraising entity and that profits
10from the sale to the fundraising entity. This paragraph is
11exempt from the provisions of Section 3-55.
12    (23) Beginning January 1, 2000 and through December 31,
132001, new or used automatic vending machines that prepare and
14serve hot food and beverages, including coffee, soup, and
15other items, and replacement parts for these machines.
16Beginning January 1, 2002 and through June 30, 2003, machines
17and parts for machines used in commercial, coin-operated
18amusement and vending business if a use or occupation tax is
19paid on the gross receipts derived from the use of the
20commercial, coin-operated amusement and vending machines. This
21paragraph is exempt from the provisions of Section 3-55.
22    (24) Beginning on August 2, 2001 (the effective date of
23Public Act 92-227), computers and communications equipment
24utilized for any hospital purpose and equipment used in the
25diagnosis, analysis, or treatment of hospital patients sold to
26a lessor who leases the equipment, under a lease of one year or

 

 

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1longer executed or in effect at the time of the purchase, to a
2hospital that has been issued an active tax exemption
3identification number by the Department under Section 1g of
4the Retailers' Occupation Tax Act. This paragraph is exempt
5from the provisions of Section 3-55.
6    (25) Beginning on August 2, 2001 (the effective date of
7Public Act 92-227), personal property sold to a lessor who
8leases the property, under a lease of one year or longer
9executed or in effect at the time of the purchase, to a
10governmental body that has been issued an active tax exemption
11identification number by the Department under Section 1g of
12the Retailers' Occupation Tax Act. This paragraph is exempt
13from the provisions of Section 3-55.
14    (26) Beginning on January 1, 2002 and through June 30,
152016, tangible personal property purchased from an Illinois
16retailer by a taxpayer engaged in centralized purchasing
17activities in Illinois who will, upon receipt of the property
18in Illinois, temporarily store the property in Illinois (i)
19for the purpose of subsequently transporting it outside this
20State for use or consumption thereafter solely outside this
21State or (ii) for the purpose of being processed, fabricated,
22or manufactured into, attached to, or incorporated into other
23tangible personal property to be transported outside this
24State and thereafter used or consumed solely outside this
25State. The Director of Revenue shall, pursuant to rules
26adopted in accordance with the Illinois Administrative

 

 

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1Procedure Act, issue a permit to any taxpayer in good standing
2with the Department who is eligible for the exemption under
3this paragraph (26). The permit issued under this paragraph
4(26) shall authorize the holder, to the extent and in the
5manner specified in the rules adopted under this Act, to
6purchase tangible personal property from a retailer exempt
7from the taxes imposed by this Act. Taxpayers shall maintain
8all necessary books and records to substantiate the use and
9consumption of all such tangible personal property outside of
10the State of Illinois.
11    (27) Beginning January 1, 2008, tangible personal property
12used in the construction or maintenance of a community water
13supply, as defined under Section 3.145 of the Environmental
14Protection Act, that is operated by a not-for-profit
15corporation that holds a valid water supply permit issued
16under Title IV of the Environmental Protection Act. This
17paragraph is exempt from the provisions of Section 3-55.
18    (28) Tangible personal property sold to a
19public-facilities corporation, as described in Section
2011-65-10 of the Illinois Municipal Code, for purposes of
21constructing or furnishing a municipal convention hall, but
22only if the legal title to the municipal convention hall is
23transferred to the municipality without any further
24consideration by or on behalf of the municipality at the time
25of the completion of the municipal convention hall or upon the
26retirement or redemption of any bonds or other debt

 

 

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1instruments issued by the public-facilities corporation in
2connection with the development of the municipal convention
3hall. This exemption includes existing public-facilities
4corporations as provided in Section 11-65-25 of the Illinois
5Municipal Code. This paragraph is exempt from the provisions
6of Section 3-55.
7    (29) Beginning January 1, 2010 and continuing through
8December 31, 2029, materials, parts, equipment, components,
9and furnishings incorporated into or upon an aircraft as part
10of the modification, refurbishment, completion, replacement,
11repair, or maintenance of the aircraft. This exemption
12includes consumable supplies used in the modification,
13refurbishment, completion, replacement, repair, and
14maintenance of aircraft. However, until January 1, 2024, this
15exemption excludes any materials, parts, equipment,
16components, and consumable supplies used in the modification,
17replacement, repair, and maintenance of aircraft engines or
18power plants, whether such engines or power plants are
19installed or uninstalled upon any such aircraft. "Consumable
20supplies" include, but are not limited to, adhesive, tape,
21sandpaper, general purpose lubricants, cleaning solution,
22latex gloves, and protective films.
23    Beginning January 1, 2010 and continuing through December
2431, 2023, this exemption applies only to the transfer of
25qualifying tangible personal property incident to the
26modification, refurbishment, completion, replacement, repair,

 

 

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1or maintenance of an aircraft by persons who (i) hold an Air
2Agency Certificate and are empowered to operate an approved
3repair station by the Federal Aviation Administration, (ii)
4have a Class IV Rating, and (iii) conduct operations in
5accordance with Part 145 of the Federal Aviation Regulations.
6The exemption does not include aircraft operated by a
7commercial air carrier providing scheduled passenger air
8service pursuant to authority issued under Part 121 or Part
9129 of the Federal Aviation Regulations. From January 1, 2024
10through December 31, 2029, this exemption applies only to the
11use of qualifying tangible personal property by: (A) persons
12who modify, refurbish, complete, repair, replace, or maintain
13aircraft and who (i) hold an Air Agency Certificate and are
14empowered to operate an approved repair station by the Federal
15Aviation Administration, (ii) have a Class IV Rating, and
16(iii) conduct operations in accordance with Part 145 of the
17Federal Aviation Regulations; and (B) persons who engage in
18the modification, replacement, repair, and maintenance of
19aircraft engines or power plants without regard to whether or
20not those persons meet the qualifications of item (A).
21    The changes made to this paragraph (29) by Public Act
2298-534 are declarative of existing law. It is the intent of the
23General Assembly that the exemption under this paragraph (29)
24applies continuously from January 1, 2010 through December 31,
252024; however, no claim for credit or refund is allowed for
26taxes paid as a result of the disallowance of this exemption on

 

 

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1or after January 1, 2015 and prior to February 5, 2020 (the
2effective date of Public Act 101-629).
3    (30) Beginning January 1, 2017 and through December 31,
42026, menstrual pads, tampons, and menstrual cups.
5    (31) Tangible personal property transferred to a purchaser
6who is exempt from tax by operation of federal law. This
7paragraph is exempt from the provisions of Section 3-55.
8    (32) Qualified tangible personal property used in the
9construction or operation of a data center that has been
10granted a certificate of exemption by the Department of
11Commerce and Economic Opportunity, whether that tangible
12personal property is purchased by the owner, operator, or
13tenant of the data center or by a contractor or subcontractor
14of the owner, operator, or tenant. Data centers that would
15have qualified for a certificate of exemption prior to January
161, 2020 had Public Act 101-31 been in effect, may apply for and
17obtain an exemption for subsequent purchases of computer
18equipment or enabling software purchased or leased to upgrade,
19supplement, or replace computer equipment or enabling software
20purchased or leased in the original investment that would have
21qualified.
22    The Department of Commerce and Economic Opportunity shall
23grant a certificate of exemption under this item (32) to
24qualified data centers as defined by Section 605-1025 of the
25Department of Commerce and Economic Opportunity Law of the
26Civil Administrative Code of Illinois.

 

 

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1    For the purposes of this item (32):
2        "Data center" means a building or a series of
3    buildings rehabilitated or constructed to house working
4    servers in one physical location or multiple sites within
5    the State of Illinois.
6        "Qualified tangible personal property" means:
7    electrical systems and equipment; climate control and
8    chilling equipment and systems; mechanical systems and
9    equipment; monitoring and secure systems; emergency
10    generators; hardware; computers; servers; data storage
11    devices; network connectivity equipment; racks; cabinets;
12    telecommunications cabling infrastructure; raised floor
13    systems; peripheral components or systems; software;
14    mechanical, electrical, or plumbing systems; battery
15    systems; cooling systems and towers; temperature control
16    systems; other cabling; and other data center
17    infrastructure equipment and systems necessary to operate
18    qualified tangible personal property, including fixtures;
19    and component parts of any of the foregoing, including
20    installation, maintenance, repair, refurbishment, and
21    replacement of qualified tangible personal property to
22    generate, transform, transmit, distribute, or manage
23    electricity necessary to operate qualified tangible
24    personal property; and all other tangible personal
25    property that is essential to the operations of a computer
26    data center. The term "qualified tangible personal

 

 

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1    property" also includes building materials physically
2    incorporated into in to the qualifying data center. To
3    document the exemption allowed under this Section, the
4    retailer must obtain from the purchaser a copy of the
5    certificate of eligibility issued by the Department of
6    Commerce and Economic Opportunity.
7    This item (32) is exempt from the provisions of Section
83-55.
9    (33) Beginning July 1, 2022, breast pumps, breast pump
10collection and storage supplies, and breast pump kits. This
11item (33) is exempt from the provisions of Section 3-55. As
12used in this item (33):
13        "Breast pump" means an electrically controlled or
14    manually controlled pump device designed or marketed to be
15    used to express milk from a human breast during lactation,
16    including the pump device and any battery, AC adapter, or
17    other power supply unit that is used to power the pump
18    device and is packaged and sold with the pump device at the
19    time of sale.
20        "Breast pump collection and storage supplies" means
21    items of tangible personal property designed or marketed
22    to be used in conjunction with a breast pump to collect
23    milk expressed from a human breast and to store collected
24    milk until it is ready for consumption.
25        "Breast pump collection and storage supplies"
26    includes, but is not limited to: breast shields and breast

 

 

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1    shield connectors; breast pump tubes and tubing adapters;
2    breast pump valves and membranes; backflow protectors and
3    backflow protector adaptors; bottles and bottle caps
4    specific to the operation of the breast pump; and breast
5    milk storage bags.
6        "Breast pump collection and storage supplies" does not
7    include: (1) bottles and bottle caps not specific to the
8    operation of the breast pump; (2) breast pump travel bags
9    and other similar carrying accessories, including ice
10    packs, labels, and other similar products; (3) breast pump
11    cleaning supplies; (4) nursing bras, bra pads, breast
12    shells, and other similar products; and (5) creams,
13    ointments, and other similar products that relieve
14    breastfeeding-related symptoms or conditions of the
15    breasts or nipples, unless sold as part of a breast pump
16    kit that is pre-packaged by the breast pump manufacturer
17    or distributor.
18        "Breast pump kit" means a kit that: (1) contains no
19    more than a breast pump, breast pump collection and
20    storage supplies, a rechargeable battery for operating the
21    breast pump, a breastmilk cooler, bottle stands, ice
22    packs, and a breast pump carrying case; and (2) is
23    pre-packaged as a breast pump kit by the breast pump
24    manufacturer or distributor.
25    (34) Tangible personal property sold by or on behalf of
26the State Treasurer pursuant to the Revised Uniform Unclaimed

 

 

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1Property Act. This item (34) is exempt from the provisions of
2Section 3-55.
3    (35) Beginning on January 1, 2024, tangible personal
4property purchased by an active duty member of the armed
5forces of the United States who presents valid military
6identification and purchases the property using a form of
7payment where the federal government is the payor. The member
8of the armed forces must complete, at the point of sale, a form
9prescribed by the Department of Revenue documenting that the
10transaction is eligible for the exemption under this
11paragraph. Retailers must keep the form as documentation of
12the exemption in their records for a period of not less than 6
13years. "Armed forces of the United States" means the United
14States Army, Navy, Air Force, Marine Corps, or Coast Guard.
15This paragraph is exempt from the provisions of Section 3-55.
16    (36) Diapers, baby wipes, car seats, infant formula, and
17bottles suitable for feeding infants. This item (36) is exempt
18from the provisions of Section 3-55.
19(Source: P.A. 102-16, eff. 6-17-21; 102-700, Article 70,
20Section 70-15, eff. 4-19-22; 102-700, Article 75, Section
2175-15, eff. 4-19-22; 102-1026, eff. 5-27-22; 103-9, Article 5,
22Section 5-15, eff. 6-7-23; 103-9, Article 15, Section 15-15,
23eff. 6-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24;
24revised 12-12-23.)
 
25    Section 20. The Retailers' Occupation Tax Act is amended

 

 

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1by changing Section 2-5 as follows:
 
2    (35 ILCS 120/2-5)
3    Sec. 2-5. Exemptions. Gross receipts from proceeds from
4the sale of the following tangible personal property are
5exempt from the tax imposed by this Act:
6        (1) Farm chemicals.
7        (2) Farm machinery and equipment, both new and used,
8    including that manufactured on special order, certified by
9    the purchaser to be used primarily for production
10    agriculture or State or federal agricultural programs,
11    including individual replacement parts for the machinery
12    and equipment, including machinery and equipment purchased
13    for lease, and including implements of husbandry defined
14    in Section 1-130 of the Illinois Vehicle Code, farm
15    machinery and agricultural chemical and fertilizer
16    spreaders, and nurse wagons required to be registered
17    under Section 3-809 of the Illinois Vehicle Code, but
18    excluding other motor vehicles required to be registered
19    under the Illinois Vehicle Code. Horticultural polyhouses
20    or hoop houses used for propagating, growing, or
21    overwintering plants shall be considered farm machinery
22    and equipment under this item (2). Agricultural chemical
23    tender tanks and dry boxes shall include units sold
24    separately from a motor vehicle required to be licensed
25    and units sold mounted on a motor vehicle required to be

 

 

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1    licensed, if the selling price of the tender is separately
2    stated.
3        Farm machinery and equipment shall include precision
4    farming equipment that is installed or purchased to be
5    installed on farm machinery and equipment including, but
6    not limited to, tractors, harvesters, sprayers, planters,
7    seeders, or spreaders. Precision farming equipment
8    includes, but is not limited to, soil testing sensors,
9    computers, monitors, software, global positioning and
10    mapping systems, and other such equipment.
11        Farm machinery and equipment also includes computers,
12    sensors, software, and related equipment used primarily in
13    the computer-assisted operation of production agriculture
14    facilities, equipment, and activities such as, but not
15    limited to, the collection, monitoring, and correlation of
16    animal and crop data for the purpose of formulating animal
17    diets and agricultural chemicals.
18        Beginning on January 1, 2024, farm machinery and
19    equipment also includes electrical power generation
20    equipment used primarily for production agriculture.
21        This item (2) is exempt from the provisions of Section
22    2-70.
23        (3) Until July 1, 2003, distillation machinery and
24    equipment, sold as a unit or kit, assembled or installed
25    by the retailer, certified by the user to be used only for
26    the production of ethyl alcohol that will be used for

 

 

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1    consumption as motor fuel or as a component of motor fuel
2    for the personal use of the user, and not subject to sale
3    or resale.
4        (4) Until July 1, 2003 and beginning again September
5    1, 2004 through August 30, 2014, graphic arts machinery
6    and equipment, including repair and replacement parts,
7    both new and used, and including that manufactured on
8    special order or purchased for lease, certified by the
9    purchaser to be used primarily for graphic arts
10    production. Equipment includes chemicals or chemicals
11    acting as catalysts but only if the chemicals or chemicals
12    acting as catalysts effect a direct and immediate change
13    upon a graphic arts product. Beginning on July 1, 2017,
14    graphic arts machinery and equipment is included in the
15    manufacturing and assembling machinery and equipment
16    exemption under paragraph (14).
17        (5) A motor vehicle that is used for automobile
18    renting, as defined in the Automobile Renting Occupation
19    and Use Tax Act. This paragraph is exempt from the
20    provisions of Section 2-70.
21        (6) Personal property sold by a teacher-sponsored
22    student organization affiliated with an elementary or
23    secondary school located in Illinois.
24        (7) Until July 1, 2003, proceeds of that portion of
25    the selling price of a passenger car the sale of which is
26    subject to the Replacement Vehicle Tax.

 

 

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1        (8) Personal property sold to an Illinois county fair
2    association for use in conducting, operating, or promoting
3    the county fair.
4        (9) Personal property sold to a not-for-profit arts or
5    cultural organization that establishes, by proof required
6    by the Department by rule, that it has received an
7    exemption under Section 501(c)(3) of the Internal Revenue
8    Code and that is organized and operated primarily for the
9    presentation or support of arts or cultural programming,
10    activities, or services. These organizations include, but
11    are not limited to, music and dramatic arts organizations
12    such as symphony orchestras and theatrical groups, arts
13    and cultural service organizations, local arts councils,
14    visual arts organizations, and media arts organizations.
15    On and after July 1, 2001 (the effective date of Public Act
16    92-35), however, an entity otherwise eligible for this
17    exemption shall not make tax-free purchases unless it has
18    an active identification number issued by the Department.
19        (10) Personal property sold by a corporation, society,
20    association, foundation, institution, or organization,
21    other than a limited liability company, that is organized
22    and operated as a not-for-profit service enterprise for
23    the benefit of persons 65 years of age or older if the
24    personal property was not purchased by the enterprise for
25    the purpose of resale by the enterprise.
26        (11) Except as otherwise provided in this Section,

 

 

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1    personal property sold to a governmental body, to a
2    corporation, society, association, foundation, or
3    institution organized and operated exclusively for
4    charitable, religious, or educational purposes, or to a
5    not-for-profit corporation, society, association,
6    foundation, institution, or organization that has no
7    compensated officers or employees and that is organized
8    and operated primarily for the recreation of persons 55
9    years of age or older. A limited liability company may
10    qualify for the exemption under this paragraph only if the
11    limited liability company is organized and operated
12    exclusively for educational purposes. On and after July 1,
13    1987, however, no entity otherwise eligible for this
14    exemption shall make tax-free purchases unless it has an
15    active identification number issued by the Department.
16        (12) (Blank).
17        (12-5) On and after July 1, 2003 and through June 30,
18    2004, motor vehicles of the second division with a gross
19    vehicle weight in excess of 8,000 pounds that are subject
20    to the commercial distribution fee imposed under Section
21    3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
22    2004 and through June 30, 2005, the use in this State of
23    motor vehicles of the second division: (i) with a gross
24    vehicle weight rating in excess of 8,000 pounds; (ii) that
25    are subject to the commercial distribution fee imposed
26    under Section 3-815.1 of the Illinois Vehicle Code; and

 

 

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1    (iii) that are primarily used for commercial purposes.
2    Through June 30, 2005, this exemption applies to repair
3    and replacement parts added after the initial purchase of
4    such a motor vehicle if that motor vehicle is used in a
5    manner that would qualify for the rolling stock exemption
6    otherwise provided for in this Act. For purposes of this
7    paragraph, "used for commercial purposes" means the
8    transportation of persons or property in furtherance of
9    any commercial or industrial enterprise whether for-hire
10    or not.
11        (13) Proceeds from sales to owners, lessors, or
12    shippers of tangible personal property that is utilized by
13    interstate carriers for hire for use as rolling stock
14    moving in interstate commerce and equipment operated by a
15    telecommunications provider, licensed as a common carrier
16    by the Federal Communications Commission, which is
17    permanently installed in or affixed to aircraft moving in
18    interstate commerce.
19        (14) Machinery and equipment that will be used by the
20    purchaser, or a lessee of the purchaser, primarily in the
21    process of manufacturing or assembling tangible personal
22    property for wholesale or retail sale or lease, whether
23    the sale or lease is made directly by the manufacturer or
24    by some other person, whether the materials used in the
25    process are owned by the manufacturer or some other
26    person, or whether the sale or lease is made apart from or

 

 

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1    as an incident to the seller's engaging in the service
2    occupation of producing machines, tools, dies, jigs,
3    patterns, gauges, or other similar items of no commercial
4    value on special order for a particular purchaser. The
5    exemption provided by this paragraph (14) does not include
6    machinery and equipment used in (i) the generation of
7    electricity for wholesale or retail sale; (ii) the
8    generation or treatment of natural or artificial gas for
9    wholesale or retail sale that is delivered to customers
10    through pipes, pipelines, or mains; or (iii) the treatment
11    of water for wholesale or retail sale that is delivered to
12    customers through pipes, pipelines, or mains. The
13    provisions of Public Act 98-583 are declaratory of
14    existing law as to the meaning and scope of this
15    exemption. Beginning on July 1, 2017, the exemption
16    provided by this paragraph (14) includes, but is not
17    limited to, graphic arts machinery and equipment, as
18    defined in paragraph (4) of this Section.
19        (15) Proceeds of mandatory service charges separately
20    stated on customers' bills for purchase and consumption of
21    food and beverages, to the extent that the proceeds of the
22    service charge are in fact turned over as tips or as a
23    substitute for tips to the employees who participate
24    directly in preparing, serving, hosting or cleaning up the
25    food or beverage function with respect to which the
26    service charge is imposed.

 

 

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1        (16) Tangible personal property sold to a purchaser if
2    the purchaser is exempt from use tax by operation of
3    federal law. This paragraph is exempt from the provisions
4    of Section 2-70.
5        (17) Tangible personal property sold to a common
6    carrier by rail or motor that receives the physical
7    possession of the property in Illinois and that transports
8    the property, or shares with another common carrier in the
9    transportation of the property, out of Illinois on a
10    standard uniform bill of lading showing the seller of the
11    property as the shipper or consignor of the property to a
12    destination outside Illinois, for use outside Illinois.
13        (18) Legal tender, currency, medallions, or gold or
14    silver coinage issued by the State of Illinois, the
15    government of the United States of America, or the
16    government of any foreign country, and bullion.
17        (19) Until July 1, 2003, oil field exploration,
18    drilling, and production equipment, including (i) rigs and
19    parts of rigs, rotary rigs, cable tool rigs, and workover
20    rigs, (ii) pipe and tubular goods, including casing and
21    drill strings, (iii) pumps and pump-jack units, (iv)
22    storage tanks and flow lines, (v) any individual
23    replacement part for oil field exploration, drilling, and
24    production equipment, and (vi) machinery and equipment
25    purchased for lease; but excluding motor vehicles required
26    to be registered under the Illinois Vehicle Code.

 

 

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1        (20) Photoprocessing machinery and equipment,
2    including repair and replacement parts, both new and used,
3    including that manufactured on special order, certified by
4    the purchaser to be used primarily for photoprocessing,
5    and including photoprocessing machinery and equipment
6    purchased for lease.
7        (21) Until July 1, 2028, coal and aggregate
8    exploration, mining, off-highway hauling, processing,
9    maintenance, and reclamation equipment, including
10    replacement parts and equipment, and including equipment
11    purchased for lease, but excluding motor vehicles required
12    to be registered under the Illinois Vehicle Code. The
13    changes made to this Section by Public Act 97-767 apply on
14    and after July 1, 2003, but no claim for credit or refund
15    is allowed on or after August 16, 2013 (the effective date
16    of Public Act 98-456) for such taxes paid during the
17    period beginning July 1, 2003 and ending on August 16,
18    2013 (the effective date of Public Act 98-456).
19        (22) Until June 30, 2013, fuel and petroleum products
20    sold to or used by an air carrier, certified by the carrier
21    to be used for consumption, shipment, or storage in the
22    conduct of its business as an air common carrier, for a
23    flight destined for or returning from a location or
24    locations outside the United States without regard to
25    previous or subsequent domestic stopovers.
26        Beginning July 1, 2013, fuel and petroleum products

 

 

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1    sold to or used by an air carrier, certified by the carrier
2    to be used for consumption, shipment, or storage in the
3    conduct of its business as an air common carrier, for a
4    flight that (i) is engaged in foreign trade or is engaged
5    in trade between the United States and any of its
6    possessions and (ii) transports at least one individual or
7    package for hire from the city of origination to the city
8    of final destination on the same aircraft, without regard
9    to a change in the flight number of that aircraft.
10        (23) A transaction in which the purchase order is
11    received by a florist who is located outside Illinois, but
12    who has a florist located in Illinois deliver the property
13    to the purchaser or the purchaser's donee in Illinois.
14        (24) Fuel consumed or used in the operation of ships,
15    barges, or vessels that are used primarily in or for the
16    transportation of property or the conveyance of persons
17    for hire on rivers bordering on this State if the fuel is
18    delivered by the seller to the purchaser's barge, ship, or
19    vessel while it is afloat upon that bordering river.
20        (25) Except as provided in item (25-5) of this
21    Section, a motor vehicle sold in this State to a
22    nonresident even though the motor vehicle is delivered to
23    the nonresident in this State, if the motor vehicle is not
24    to be titled in this State, and if a drive-away permit is
25    issued to the motor vehicle as provided in Section 3-603
26    of the Illinois Vehicle Code or if the nonresident

 

 

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1    purchaser has vehicle registration plates to transfer to
2    the motor vehicle upon returning to his or her home state.
3    The issuance of the drive-away permit or having the
4    out-of-state registration plates to be transferred is
5    prima facie evidence that the motor vehicle will not be
6    titled in this State.
7        (25-5) The exemption under item (25) does not apply if
8    the state in which the motor vehicle will be titled does
9    not allow a reciprocal exemption for a motor vehicle sold
10    and delivered in that state to an Illinois resident but
11    titled in Illinois. The tax collected under this Act on
12    the sale of a motor vehicle in this State to a resident of
13    another state that does not allow a reciprocal exemption
14    shall be imposed at a rate equal to the state's rate of tax
15    on taxable property in the state in which the purchaser is
16    a resident, except that the tax shall not exceed the tax
17    that would otherwise be imposed under this Act. At the
18    time of the sale, the purchaser shall execute a statement,
19    signed under penalty of perjury, of his or her intent to
20    title the vehicle in the state in which the purchaser is a
21    resident within 30 days after the sale and of the fact of
22    the payment to the State of Illinois of tax in an amount
23    equivalent to the state's rate of tax on taxable property
24    in his or her state of residence and shall submit the
25    statement to the appropriate tax collection agency in his
26    or her state of residence. In addition, the retailer must

 

 

SB3128- 75 -LRB103 38386 HLH 68521 b

1    retain a signed copy of the statement in his or her
2    records. Nothing in this item shall be construed to
3    require the removal of the vehicle from this state
4    following the filing of an intent to title the vehicle in
5    the purchaser's state of residence if the purchaser titles
6    the vehicle in his or her state of residence within 30 days
7    after the date of sale. The tax collected under this Act in
8    accordance with this item (25-5) shall be proportionately
9    distributed as if the tax were collected at the 6.25%
10    general rate imposed under this Act.
11        (25-7) Beginning on July 1, 2007, no tax is imposed
12    under this Act on the sale of an aircraft, as defined in
13    Section 3 of the Illinois Aeronautics Act, if all of the
14    following conditions are met:
15            (1) the aircraft leaves this State within 15 days
16        after the later of either the issuance of the final
17        billing for the sale of the aircraft, or the
18        authorized approval for return to service, completion
19        of the maintenance record entry, and completion of the
20        test flight and ground test for inspection, as
21        required by 14 CFR 91.407;
22            (2) the aircraft is not based or registered in
23        this State after the sale of the aircraft; and
24            (3) the seller retains in his or her books and
25        records and provides to the Department a signed and
26        dated certification from the purchaser, on a form

 

 

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1        prescribed by the Department, certifying that the
2        requirements of this item (25-7) are met. The
3        certificate must also include the name and address of
4        the purchaser, the address of the location where the
5        aircraft is to be titled or registered, the address of
6        the primary physical location of the aircraft, and
7        other information that the Department may reasonably
8        require.
9        For purposes of this item (25-7):
10        "Based in this State" means hangared, stored, or
11    otherwise used, excluding post-sale customizations as
12    defined in this Section, for 10 or more days in each
13    12-month period immediately following the date of the sale
14    of the aircraft.
15        "Registered in this State" means an aircraft
16    registered with the Department of Transportation,
17    Aeronautics Division, or titled or registered with the
18    Federal Aviation Administration to an address located in
19    this State.
20        This paragraph (25-7) is exempt from the provisions of
21    Section 2-70.
22        (26) Semen used for artificial insemination of
23    livestock for direct agricultural production.
24        (27) Horses, or interests in horses, registered with
25    and meeting the requirements of any of the Arabian Horse
26    Club Registry of America, Appaloosa Horse Club, American

 

 

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1    Quarter Horse Association, United States Trotting
2    Association, or Jockey Club, as appropriate, used for
3    purposes of breeding or racing for prizes. This item (27)
4    is exempt from the provisions of Section 2-70, and the
5    exemption provided for under this item (27) applies for
6    all periods beginning May 30, 1995, but no claim for
7    credit or refund is allowed on or after January 1, 2008
8    (the effective date of Public Act 95-88) for such taxes
9    paid during the period beginning May 30, 2000 and ending
10    on January 1, 2008 (the effective date of Public Act
11    95-88).
12        (28) Computers and communications equipment utilized
13    for any hospital purpose and equipment used in the
14    diagnosis, analysis, or treatment of hospital patients
15    sold to a lessor who leases the equipment, under a lease of
16    one year or longer executed or in effect at the time of the
17    purchase, to a hospital that has been issued an active tax
18    exemption identification number by the Department under
19    Section 1g of this Act.
20        (29) Personal property sold to a lessor who leases the
21    property, under a lease of one year or longer executed or
22    in effect at the time of the purchase, to a governmental
23    body that has been issued an active tax exemption
24    identification number by the Department under Section 1g
25    of this Act.
26        (30) Beginning with taxable years ending on or after

 

 

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1    December 31, 1995 and ending with taxable years ending on
2    or before December 31, 2004, personal property that is
3    donated for disaster relief to be used in a State or
4    federally declared disaster area in Illinois or bordering
5    Illinois by a manufacturer or retailer that is registered
6    in this State to a corporation, society, association,
7    foundation, or institution that has been issued a sales
8    tax exemption identification number by the Department that
9    assists victims of the disaster who reside within the
10    declared disaster area.
11        (31) Beginning with taxable years ending on or after
12    December 31, 1995 and ending with taxable years ending on
13    or before December 31, 2004, personal property that is
14    used in the performance of infrastructure repairs in this
15    State, including, but not limited to, municipal roads and
16    streets, access roads, bridges, sidewalks, waste disposal
17    systems, water and sewer line extensions, water
18    distribution and purification facilities, storm water
19    drainage and retention facilities, and sewage treatment
20    facilities, resulting from a State or federally declared
21    disaster in Illinois or bordering Illinois when such
22    repairs are initiated on facilities located in the
23    declared disaster area within 6 months after the disaster.
24        (32) Beginning July 1, 1999, game or game birds sold
25    at a "game breeding and hunting preserve area" as that
26    term is used in the Wildlife Code. This paragraph is

 

 

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1    exempt from the provisions of Section 2-70.
2        (33) A motor vehicle, as that term is defined in
3    Section 1-146 of the Illinois Vehicle Code, that is
4    donated to a corporation, limited liability company,
5    society, association, foundation, or institution that is
6    determined by the Department to be organized and operated
7    exclusively for educational purposes. For purposes of this
8    exemption, "a corporation, limited liability company,
9    society, association, foundation, or institution organized
10    and operated exclusively for educational purposes" means
11    all tax-supported public schools, private schools that
12    offer systematic instruction in useful branches of
13    learning by methods common to public schools and that
14    compare favorably in their scope and intensity with the
15    course of study presented in tax-supported schools, and
16    vocational or technical schools or institutes organized
17    and operated exclusively to provide a course of study of
18    not less than 6 weeks duration and designed to prepare
19    individuals to follow a trade or to pursue a manual,
20    technical, mechanical, industrial, business, or commercial
21    occupation.
22        (34) Beginning January 1, 2000, personal property,
23    including food, purchased through fundraising events for
24    the benefit of a public or private elementary or secondary
25    school, a group of those schools, or one or more school
26    districts if the events are sponsored by an entity

 

 

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1    recognized by the school district that consists primarily
2    of volunteers and includes parents and teachers of the
3    school children. This paragraph does not apply to
4    fundraising events (i) for the benefit of private home
5    instruction or (ii) for which the fundraising entity
6    purchases the personal property sold at the events from
7    another individual or entity that sold the property for
8    the purpose of resale by the fundraising entity and that
9    profits from the sale to the fundraising entity. This
10    paragraph is exempt from the provisions of Section 2-70.
11        (35) Beginning January 1, 2000 and through December
12    31, 2001, new or used automatic vending machines that
13    prepare and serve hot food and beverages, including
14    coffee, soup, and other items, and replacement parts for
15    these machines. Beginning January 1, 2002 and through June
16    30, 2003, machines and parts for machines used in
17    commercial, coin-operated amusement and vending business
18    if a use or occupation tax is paid on the gross receipts
19    derived from the use of the commercial, coin-operated
20    amusement and vending machines. This paragraph is exempt
21    from the provisions of Section 2-70.
22        (35-5) Beginning August 23, 2001 and through June 30,
23    2016, food for human consumption that is to be consumed
24    off the premises where it is sold (other than alcoholic
25    beverages, soft drinks, and food that has been prepared
26    for immediate consumption) and prescription and

 

 

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1    nonprescription medicines, drugs, medical appliances, and
2    insulin, urine testing materials, syringes, and needles
3    used by diabetics, for human use, when purchased for use
4    by a person receiving medical assistance under Article V
5    of the Illinois Public Aid Code who resides in a licensed
6    long-term care facility, as defined in the Nursing Home
7    Care Act, or a licensed facility as defined in the ID/DD
8    Community Care Act, the MC/DD Act, or the Specialized
9    Mental Health Rehabilitation Act of 2013.
10        (36) Beginning August 2, 2001, computers and
11    communications equipment utilized for any hospital purpose
12    and equipment used in the diagnosis, analysis, or
13    treatment of hospital patients sold to a lessor who leases
14    the equipment, under a lease of one year or longer
15    executed or in effect at the time of the purchase, to a
16    hospital that has been issued an active tax exemption
17    identification number by the Department under Section 1g
18    of this Act. This paragraph is exempt from the provisions
19    of Section 2-70.
20        (37) Beginning August 2, 2001, personal property sold
21    to a lessor who leases the property, under a lease of one
22    year or longer executed or in effect at the time of the
23    purchase, to a governmental body that has been issued an
24    active tax exemption identification number by the
25    Department under Section 1g of this Act. This paragraph is
26    exempt from the provisions of Section 2-70.

 

 

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1        (38) Beginning on January 1, 2002 and through June 30,
2    2016, tangible personal property purchased from an
3    Illinois retailer by a taxpayer engaged in centralized
4    purchasing activities in Illinois who will, upon receipt
5    of the property in Illinois, temporarily store the
6    property in Illinois (i) for the purpose of subsequently
7    transporting it outside this State for use or consumption
8    thereafter solely outside this State or (ii) for the
9    purpose of being processed, fabricated, or manufactured
10    into, attached to, or incorporated into other tangible
11    personal property to be transported outside this State and
12    thereafter used or consumed solely outside this State. The
13    Director of Revenue shall, pursuant to rules adopted in
14    accordance with the Illinois Administrative Procedure Act,
15    issue a permit to any taxpayer in good standing with the
16    Department who is eligible for the exemption under this
17    paragraph (38). The permit issued under this paragraph
18    (38) shall authorize the holder, to the extent and in the
19    manner specified in the rules adopted under this Act, to
20    purchase tangible personal property from a retailer exempt
21    from the taxes imposed by this Act. Taxpayers shall
22    maintain all necessary books and records to substantiate
23    the use and consumption of all such tangible personal
24    property outside of the State of Illinois.
25        (39) Beginning January 1, 2008, tangible personal
26    property used in the construction or maintenance of a

 

 

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1    community water supply, as defined under Section 3.145 of
2    the Environmental Protection Act, that is operated by a
3    not-for-profit corporation that holds a valid water supply
4    permit issued under Title IV of the Environmental
5    Protection Act. This paragraph is exempt from the
6    provisions of Section 2-70.
7        (40) Beginning January 1, 2010 and continuing through
8    December 31, 2029, materials, parts, equipment,
9    components, and furnishings incorporated into or upon an
10    aircraft as part of the modification, refurbishment,
11    completion, replacement, repair, or maintenance of the
12    aircraft. This exemption includes consumable supplies used
13    in the modification, refurbishment, completion,
14    replacement, repair, and maintenance of aircraft. However,
15    until January 1, 2024, this exemption excludes any
16    materials, parts, equipment, components, and consumable
17    supplies used in the modification, replacement, repair,
18    and maintenance of aircraft engines or power plants,
19    whether such engines or power plants are installed or
20    uninstalled upon any such aircraft. "Consumable supplies"
21    include, but are not limited to, adhesive, tape,
22    sandpaper, general purpose lubricants, cleaning solution,
23    latex gloves, and protective films.
24        Beginning January 1, 2010 and continuing through
25    December 31, 2023, this exemption applies only to the sale
26    of qualifying tangible personal property to persons who

 

 

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1    modify, refurbish, complete, replace, or maintain an
2    aircraft and who (i) hold an Air Agency Certificate and
3    are empowered to operate an approved repair station by the
4    Federal Aviation Administration, (ii) have a Class IV
5    Rating, and (iii) conduct operations in accordance with
6    Part 145 of the Federal Aviation Regulations. The
7    exemption does not include aircraft operated by a
8    commercial air carrier providing scheduled passenger air
9    service pursuant to authority issued under Part 121 or
10    Part 129 of the Federal Aviation Regulations. From January
11    1, 2024 through December 31, 2029, this exemption applies
12    only to the use of qualifying tangible personal property
13    by: (A) persons who modify, refurbish, complete, repair,
14    replace, or maintain aircraft and who (i) hold an Air
15    Agency Certificate and are empowered to operate an
16    approved repair station by the Federal Aviation
17    Administration, (ii) have a Class IV Rating, and (iii)
18    conduct operations in accordance with Part 145 of the
19    Federal Aviation Regulations; and (B) persons who engage
20    in the modification, replacement, repair, and maintenance
21    of aircraft engines or power plants without regard to
22    whether or not those persons meet the qualifications of
23    item (A).
24        The changes made to this paragraph (40) by Public Act
25    98-534 are declarative of existing law. It is the intent
26    of the General Assembly that the exemption under this

 

 

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1    paragraph (40) applies continuously from January 1, 2010
2    through December 31, 2024; however, no claim for credit or
3    refund is allowed for taxes paid as a result of the
4    disallowance of this exemption on or after January 1, 2015
5    and prior to February 5, 2020 (the effective date of
6    Public Act 101-629).
7        (41) Tangible personal property sold to a
8    public-facilities corporation, as described in Section
9    11-65-10 of the Illinois Municipal Code, for purposes of
10    constructing or furnishing a municipal convention hall,
11    but only if the legal title to the municipal convention
12    hall is transferred to the municipality without any
13    further consideration by or on behalf of the municipality
14    at the time of the completion of the municipal convention
15    hall or upon the retirement or redemption of any bonds or
16    other debt instruments issued by the public-facilities
17    corporation in connection with the development of the
18    municipal convention hall. This exemption includes
19    existing public-facilities corporations as provided in
20    Section 11-65-25 of the Illinois Municipal Code. This
21    paragraph is exempt from the provisions of Section 2-70.
22        (42) Beginning January 1, 2017 and through December
23    31, 2026, menstrual pads, tampons, and menstrual cups.
24        (43) Merchandise that is subject to the Rental
25    Purchase Agreement Occupation and Use Tax. The purchaser
26    must certify that the item is purchased to be rented

 

 

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1    subject to a rental-purchase rental purchase agreement, as
2    defined in the Rental-Purchase Rental Purchase Agreement
3    Act, and provide proof of registration under the Rental
4    Purchase Agreement Occupation and Use Tax Act. This
5    paragraph is exempt from the provisions of Section 2-70.
6        (44) Qualified tangible personal property used in the
7    construction or operation of a data center that has been
8    granted a certificate of exemption by the Department of
9    Commerce and Economic Opportunity, whether that tangible
10    personal property is purchased by the owner, operator, or
11    tenant of the data center or by a contractor or
12    subcontractor of the owner, operator, or tenant. Data
13    centers that would have qualified for a certificate of
14    exemption prior to January 1, 2020 had Public Act 101-31
15    been in effect, may apply for and obtain an exemption for
16    subsequent purchases of computer equipment or enabling
17    software purchased or leased to upgrade, supplement, or
18    replace computer equipment or enabling software purchased
19    or leased in the original investment that would have
20    qualified.
21        The Department of Commerce and Economic Opportunity
22    shall grant a certificate of exemption under this item
23    (44) to qualified data centers as defined by Section
24    605-1025 of the Department of Commerce and Economic
25    Opportunity Law of the Civil Administrative Code of
26    Illinois.

 

 

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1        For the purposes of this item (44):
2            "Data center" means a building or a series of
3        buildings rehabilitated or constructed to house
4        working servers in one physical location or multiple
5        sites within the State of Illinois.
6            "Qualified tangible personal property" means:
7        electrical systems and equipment; climate control and
8        chilling equipment and systems; mechanical systems and
9        equipment; monitoring and secure systems; emergency
10        generators; hardware; computers; servers; data storage
11        devices; network connectivity equipment; racks;
12        cabinets; telecommunications cabling infrastructure;
13        raised floor systems; peripheral components or
14        systems; software; mechanical, electrical, or plumbing
15        systems; battery systems; cooling systems and towers;
16        temperature control systems; other cabling; and other
17        data center infrastructure equipment and systems
18        necessary to operate qualified tangible personal
19        property, including fixtures; and component parts of
20        any of the foregoing, including installation,
21        maintenance, repair, refurbishment, and replacement of
22        qualified tangible personal property to generate,
23        transform, transmit, distribute, or manage electricity
24        necessary to operate qualified tangible personal
25        property; and all other tangible personal property
26        that is essential to the operations of a computer data

 

 

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1        center. The term "qualified tangible personal
2        property" also includes building materials physically
3        incorporated into the qualifying data center. To
4        document the exemption allowed under this Section, the
5        retailer must obtain from the purchaser a copy of the
6        certificate of eligibility issued by the Department of
7        Commerce and Economic Opportunity.
8        This item (44) is exempt from the provisions of
9    Section 2-70.
10        (45) Beginning January 1, 2020 and through December
11    31, 2020, sales of tangible personal property made by a
12    marketplace seller over a marketplace for which tax is due
13    under this Act but for which use tax has been collected and
14    remitted to the Department by a marketplace facilitator
15    under Section 2d of the Use Tax Act are exempt from tax
16    under this Act. A marketplace seller claiming this
17    exemption shall maintain books and records demonstrating
18    that the use tax on such sales has been collected and
19    remitted by a marketplace facilitator. Marketplace sellers
20    that have properly remitted tax under this Act on such
21    sales may file a claim for credit as provided in Section 6
22    of this Act. No claim is allowed, however, for such taxes
23    for which a credit or refund has been issued to the
24    marketplace facilitator under the Use Tax Act, or for
25    which the marketplace facilitator has filed a claim for
26    credit or refund under the Use Tax Act.

 

 

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1        (46) Beginning July 1, 2022, breast pumps, breast pump
2    collection and storage supplies, and breast pump kits.
3    This item (46) is exempt from the provisions of Section
4    2-70. As used in this item (46):
5        "Breast pump" means an electrically controlled or
6    manually controlled pump device designed or marketed to be
7    used to express milk from a human breast during lactation,
8    including the pump device and any battery, AC adapter, or
9    other power supply unit that is used to power the pump
10    device and is packaged and sold with the pump device at the
11    time of sale.
12        "Breast pump collection and storage supplies" means
13    items of tangible personal property designed or marketed
14    to be used in conjunction with a breast pump to collect
15    milk expressed from a human breast and to store collected
16    milk until it is ready for consumption.
17        "Breast pump collection and storage supplies"
18    includes, but is not limited to: breast shields and breast
19    shield connectors; breast pump tubes and tubing adapters;
20    breast pump valves and membranes; backflow protectors and
21    backflow protector adaptors; bottles and bottle caps
22    specific to the operation of the breast pump; and breast
23    milk storage bags.
24        "Breast pump collection and storage supplies" does not
25    include: (1) bottles and bottle caps not specific to the
26    operation of the breast pump; (2) breast pump travel bags

 

 

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1    and other similar carrying accessories, including ice
2    packs, labels, and other similar products; (3) breast pump
3    cleaning supplies; (4) nursing bras, bra pads, breast
4    shells, and other similar products; and (5) creams,
5    ointments, and other similar products that relieve
6    breastfeeding-related symptoms or conditions of the
7    breasts or nipples, unless sold as part of a breast pump
8    kit that is pre-packaged by the breast pump manufacturer
9    or distributor.
10        "Breast pump kit" means a kit that: (1) contains no
11    more than a breast pump, breast pump collection and
12    storage supplies, a rechargeable battery for operating the
13    breast pump, a breastmilk cooler, bottle stands, ice
14    packs, and a breast pump carrying case; and (2) is
15    pre-packaged as a breast pump kit by the breast pump
16    manufacturer or distributor.
17        (47) Tangible personal property sold by or on behalf
18    of the State Treasurer pursuant to the Revised Uniform
19    Unclaimed Property Act. This item (47) is exempt from the
20    provisions of Section 2-70.
21        (48) Beginning on January 1, 2024, tangible personal
22    property purchased by an active duty member of the armed
23    forces of the United States who presents valid military
24    identification and purchases the property using a form of
25    payment where the federal government is the payor. The
26    member of the armed forces must complete, at the point of

 

 

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1    sale, a form prescribed by the Department of Revenue
2    documenting that the transaction is eligible for the
3    exemption under this paragraph. Retailers must keep the
4    form as documentation of the exemption in their records
5    for a period of not less than 6 years. "Armed forces of the
6    United States" means the United States Army, Navy, Air
7    Force, Marine Corps, or Coast Guard. This paragraph is
8    exempt from the provisions of Section 2-70.
9        (49) Diapers, baby wipes, car seats, infant formula,
10    and bottles suitable for feeding infants. This item (49)
11    is exempt from the provisions of Section 2-70.
12(Source: P.A. 102-16, eff. 6-17-21; 102-634, eff. 8-27-21;
13102-700, Article 70, Section 70-20, eff. 4-19-22; 102-700,
14Article 75, Section 75-20, eff. 4-19-22; 102-813, eff.
155-13-22; 102-1026, eff. 5-27-22; 103-9, Article 5, Section
165-20, eff. 6-7-23; 103-9, Article 15, Section 15-20, eff.
176-7-23; 103-154, eff. 6-30-23; 103-384, eff. 1-1-24; revised
1812-12-23.)