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91_HB3192
LRB9111248MWpc
1 AN ACT concerning telecommunications taxes and fees,
2 amending named Acts.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Telecommunications Municipal
6 Infrastructure Maintenance Fee Act is amended by changing
7 Sections 20 and 25 as follows:
8 (35 ILCS 635/20)
9 Sec. 20. Municipal telecommunications infrastructure
10 maintenance fee.
11 (a) A municipality may impose a municipal infrastructure
12 maintenance fee upon telecommunications retailers in an
13 amount specified in subsection (b). On and after the
14 effective date of this amendatory Act of 1997, a certified
15 copy of an ordinance or resolution imposing a fee under this
16 Section shall be filed with the Department within 30 days
17 after the effective date of this amendatory Act or the
18 effective date of the ordinance or resolution imposing such
19 fee, whichever is later. Failure to file a certified copy of
20 the ordinance or resolution imposing a fee under this Section
21 shall have no effect on the validity of the ordinance or
22 resolution. The Department shall create and maintain a list
23 of all ordinances and resolutions filed pursuant to this
24 Section and make that list, as well as copies of the
25 ordinances and resolutions, available to the public for a
26 reasonable fee.
27 (b) The amount of the municipal infrastructure
28 maintenance fee imposed upon a telecommunications retailer
29 under this Section shall not exceed: (i) in a municipality
30 with a population of more than 500,000, 2.0% of all gross
31 charges charged by the telecommunications retailer to service
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1 addresses in the municipality for telecommunications
2 originating or received in the municipality; and (ii) in a
3 municipality with a population of 500,000 or less, 1.0% of
4 all gross charges charged by the telecommunications retailer
5 to service addresses in the municipality for
6 telecommunications originating or received in the
7 municipality. If imposed, the municipal telecommunications
8 infrastructure fee must be in 1/4% increments. However, the
9 fee shall not be imposed in any case in which the imposition
10 of the fee would violate the Constitution or statutes of the
11 United States.
12 (c) Except as provided in subsection (d), the municipal
13 telecommunications infrastructure fee authorized by this
14 Section shall be collected, enforced, and administered as set
15 forth in subsection (c) of Section 25 of this Act.
16 (d) Beginning on January 1, 2002, the fee authorized by
17 this Section and all civil penalties that are assessed as an
18 incident thereof shall be collected and enforced by the
19 Department of Revenue. The Department has the full power to
20 administer and enforce this Section, to collect all fees and
21 penalties due under this Section, to dispose of taxes and
22 penalties in the manner provided for in this Section, and to
23 determine all rights to credit memoranda arising on account
24 of the erroneous payment of a fee or penalty under this
25 Section.
26 In the administration of, and compliance with, this
27 Section, the Department and persons who are subject to this
28 Section have the same rights, remedies, privileges,
29 immunities, powers, and duties; are subject to the same
30 conditions, restrictions, limitations, penalties, and
31 definitions of terms; and shall employ the same procedures as
32 in Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j, 2 through 2-65
33 (except as to the rate of tax), 2c, 3 (except as to the
34 disposition of taxes and penalties collected), 4, 5, 5a, 5b,
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1 5c, 5d, 5e, 5f, 5g, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9,
2 10, 11, 12, and 13 of the Retailers' Occupation Tax Act as
3 fully as if those provisions were set forth in this Act.
4 Whenever the Department determines that a refund should
5 be made under this Section to a claimant instead of issuing a
6 credit memorandum, the Department shall notify the State
7 Comptroller, who shall cause the order to be drawn for the
8 amount specified and to the person named in the notification.
9 The refund shall be paid by the State Treasurer out the
10 Non-Home Rule Municipal Retailers' Occupation Tax Fund.
11 The Department shall pay over the State Treasurer, as
12 trustee, all fees and penalties collected under this Section
13 on or before the 25th day of each calendar month. The
14 Department shall prepare and certify to the Comptroller the
15 disbursement of stated sums of money to the municipalities
16 from which telecommunications retailers have paid fees or
17 penalties under this Section during the second preceding
18 calendar month. The amount paid to each municipality shall be
19 the amount (not including credit memoranda) collected during
20 the second preceding calendar month by the Department plus an
21 amount that the Department determines is necessary to offset
22 any amounts that were erroneously paid to a different taxing
23 body, and not including an amount equal to the amount of
24 refunds made during the second preceding calendar month by
25 the Department on behalf of the municipality and not
26 including any amount that the Department determines is
27 necessary to offset any amounts that were payable to a
28 different taxing body but were erroneously paid to the
29 municipality. Within 10 days after the Comptroller receives
30 the disbursement certification, the Comptroller shall cause
31 the orders to be drawn for the respective amounts in
32 accordance with the directions in the certification.
33 When certifying the amount of the monthly disbursement to
34 a municipality, the Department shall increase or decrease the
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1 amount by an amount necessary to offset any misallocation of
2 previous disbursements. The offset amount shall be the amount
3 erroneously disbursed within the previous 6 months from the
4 time a misallocation is discovered.
5 (Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97.)
6 (35 ILCS 635/25)
7 Sec. 25. Collection, enforcement, and administration of
8 telecommunications infrastructure maintenance fees.
9 (a) A telecommunications retailer shall charge each
10 customer an additional charge equal to the sum of (1) an
11 amount equal to the State infrastructure maintenance fee
12 attributable to that customer's service address and (2) an
13 amount equal to the optional infrastructure maintenance fee,
14 if any, attributable to that customer's service address and
15 (3) an amount equal to the municipal infrastructure
16 maintenance fee, if any, attributable to that customer's
17 service address. Such additional charge shall be shown
18 separately on the bill to each customer.
19 (b) The State infrastructure maintenance fee and the
20 optional infrastructure maintenance fee shall be designated
21 as a replacement for the personal property tax and shall be
22 remitted by the telecommunications retailer to the Illinois
23 Department of Revenue; provided, however, that the
24 telecommunications retailer may retain an amount not to
25 exceed 2% of the State infrastructure maintenance fee and the
26 optional infrastructure maintenance fee, if any, paid to the
27 Department, with a timely paid and timely filed return to
28 reimburse itself for expenses incurred in collecting,
29 accounting for, and remitting the fee. All amounts herein
30 remitted to the Department shall be transferred to the
31 Personal Property Tax Replacement Fund in the State Treasury.
32 (c) The municipal infrastructure maintenance fee shall
33 be remitted by the telecommunications retailer to the
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1 municipality imposing the municipal infrastructure
2 maintenance fee; provided, however, that the
3 telecommunications retailer may retain an amount not to
4 exceed 2% of the municipal infrastructure maintenance fee
5 collected by it to reimburse itself for expenses incurred in
6 accounting for and remitting the fee. The municipality
7 imposing the municipal infrastructure maintenance fee shall
8 collect, enforce, and administer the fee.
9 If the municipal infrastructure maintenance fee is
10 remitted to the Department of Revenue under subsection (d) of
11 Section 20 of this Act, the telecommunications retailer may
12 retain an amount not to exceed 1.5% of the municipal
13 infrastructure maintenance fee collected by it to reimburse
14 itself for expenses incurred in accounting for and remitting
15 the fee. The Department of Revenue shall collect, enforce,
16 and administer the fee in accordance with subsection (d) of
17 Section 20 of this Act.
18 (d) Except as provided in subsection (e), during any
19 period of time when a municipality receives any compensation
20 other than the municipal infrastructure maintenance fee set
21 forth in Section 20, for a telecommunications retailer's use
22 of the public right-of-way, no municipal infrastructure
23 maintenance fee may be imposed by such municipality pursuant
24 to this Act.
25 (e) A municipality that, pursuant to a franchise
26 agreement in existence on the effective date of this Act,
27 receives compensation from a telecommunications retailer for
28 the use of the public right of way, may impose a municipal
29 infrastructure maintenance fee pursuant to this Act only on
30 the condition that such municipality (1) waives its right to
31 receive all fees, charges and other compensation under all
32 existing franchise agreements or the like with
33 telecommunications retailers during the time that the
34 municipality imposes a municipal infrastructure maintenance
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1 fee and (2) imposes by ordinance (or other proper means) a
2 municipal infrastructure maintenance fee which becomes
3 effective no sooner than 90 days after such municipality has
4 provided written notice by certified mail to each
5 telecommunications retailer with whom the municipality has an
6 existing franchise agreement, that the municipality waives
7 all compensation under such existing franchise agreement.
8 (Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97;
9 90-655, eff. 7-30-98.)
10 Section 10. The Illinois Municipal Code is amended by
11 changing Sections 8-11-2 and 8-11-17 as follows:
12 (65 ILCS 5/8-11-2) (from Ch. 24, par. 8-11-2)
13 Sec. 8-11-2. The corporate authorities of any
14 municipality may tax any or all of the following occupations
15 or privileges:
16 1. Persons engaged in the business of transmitting
17 messages by means of electricity or radio magnetic waves,
18 or fiber optics, at a rate not to exceed 5% of the gross
19 receipts from that business originating within the
20 corporate limits of the municipality. Beginning on
21 January 1, 2002, the tax imposed under this paragraph
22 shall be collected by the Department of Revenue pursuant
23 to subsection (i) of this Section.
24 2. Persons engaged in the business of distributing,
25 supplying, furnishing, or selling gas for use or
26 consumption within the corporate limits of a municipality
27 of 500,000 or fewer population, and not for resale, at a
28 rate not to exceed 5% of the gross receipts therefrom.
29 2a. Persons engaged in the business of
30 distributing, supplying, furnishing, or selling gas for
31 use or consumption within the corporate limits of a
32 municipality of over 500,000 population, and not for
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1 resale, at a rate not to exceed 8% of the gross receipts
2 therefrom. If imposed, this tax shall be paid in monthly
3 payments.
4 3. The privilege of using or consuming electricity
5 acquired in a purchase at retail and used or consumed
6 within the corporate limits of the municipality at rates
7 not to exceed the following maximum rates, calculated on
8 a monthly basis for each purchaser:
9 (i) For the first 2,000 kilowatt-hours used or
10 consumed in a month; 0.61 cents per kilowatt-hour;
11 (ii) For the next 48,000 kilowatt-hours used or
12 consumed in a month; 0.40 cents per kilowatt-hour;
13 (iii) For the next 50,000 kilowatt-hours used or
14 consumed in a month; 0.36 cents per kilowatt-hour;
15 (iv) For the next 400,000 kilowatt-hours used or
16 consumed in a month; 0.35 cents per kilowatt-hour;
17 (v) For the next 500,000 kilowatt-hours used or
18 consumed in a month; 0.34 cents per kilowatt-hour;
19 (vi) For the next 2,000,000 kilowatt-hours used or
20 consumed in a month; 0.32 cents per kilowatt-hour;
21 (vii) For the next 2,000,000 kilowatt-hours used or
22 consumed in a month; 0.315 cents per kilowatt-hour;
23 (viii) For the next 5,000,000 kilowatt-hours used
24 or consumed in a month; 0.31 cents per kilowatt-hour;
25 (ix) For the next 10,000,000 kilowatt-hours used or
26 consumed in a month; 0.305 cents per kilowatt-hour; and
27 (x) For all electricity used or consumed in excess
28 of 20,000,000 kilowatt-hours in a month, 0.30 cents per
29 kilowatt-hour.
30 If a municipality imposes a tax at rates lower than
31 either the maximum rates specified in this Section or the
32 alternative maximum rates promulgated by the Illinois
33 Commerce Commission, as provided below, the tax rates
34 shall be imposed upon the kilowatt hour categories set
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1 forth above with the same proportional relationship as
2 that which exists among such maximum rates.
3 Notwithstanding the foregoing, until December 31, 2008,
4 no municipality shall establish rates that are in excess
5 of rates reasonably calculated to produce revenues that
6 equal the maximum total revenues such municipality could
7 have received under the tax authorized by this
8 subparagraph in the last full calendar year prior to the
9 effective date of Section 65 of this amendatory Act of
10 1997; provided that this shall not be a limitation on the
11 amount of tax revenues actually collected by such
12 municipality.
13 Upon the request of the corporate authorities of a
14 municipality, the Illinois Commerce Commission shall,
15 within 90 days after receipt of such request, promulgate
16 alternative rates for each of these kilowatt-hour
17 categories that will reflect, as closely as reasonably
18 practical for that municipality, the distribution of the
19 tax among classes of purchasers as if the tax were based
20 on a uniform percentage of the purchase price of
21 electricity. A municipality that has adopted an
22 ordinance imposing a tax pursuant to subparagraph 3 as it
23 existed prior to the effective date of Section 65 of this
24 amendatory Act of 1997 may, rather than imposing the tax
25 permitted by this amendatory Act of 1997, continue to
26 impose the tax pursuant to that ordinance with respect to
27 gross receipts received from residential customers
28 through July 31, 1999, and with respect to gross receipts
29 from any non-residential customer until the first bill
30 issued to such customer for delivery services in
31 accordance with Section 16-104 of the Public Utilities
32 Act but in no case later than the last bill issued to
33 such customer before December 31, 2000. No ordinance
34 imposing the tax permitted by this amendatory Act of 1997
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1 shall be applicable to any non-residential customer until
2 the first bill issued to such customer for delivery
3 services in accordance with Section 16-104 of the Public
4 Utilities Act but in no case later than the last bill
5 issued to such non-residential customer before December
6 31, 2000.
7 4. Persons engaged in the business of distributing,
8 supplying, furnishing, or selling water for use or
9 consumption within the corporate limits of the
10 municipality, and not for resale, at a rate not to exceed
11 5% of the gross receipts therefrom.
12 None of the taxes authorized by this Section may be
13 imposed with respect to any transaction in interstate
14 commerce or otherwise to the extent to which the business or
15 privilege may not, under the constitution and statutes of the
16 United States, be made the subject of taxation by this State
17 or any political sub-division thereof; nor shall any persons
18 engaged in the business of distributing, supplying,
19 furnishing, selling or transmitting gas, water, or
20 electricity, or engaged in the business of transmitting
21 messages, or using or consuming electricity acquired in a
22 purchase at retail, be subject to taxation under the
23 provisions of this Section for those transactions that are or
24 may become subject to taxation under the provisions of the
25 "Municipal Retailers' Occupation Tax Act" authorized by
26 Section 8-11-1; nor shall any tax authorized by this Section
27 be imposed upon any person engaged in a business or on any
28 privilege unless the tax is imposed in like manner and at the
29 same rate upon all persons engaged in businesses of the same
30 class in the municipality, whether privately or municipally
31 owned or operated, or exercising the same privilege within
32 the municipality.
33 Any of the taxes enumerated in this Section may be in
34 addition to the payment of money, or value of products or
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1 services furnished to the municipality by the taxpayer as
2 compensation for the use of its streets, alleys, or other
3 public places, or installation and maintenance therein,
4 thereon or thereunder of poles, wires, pipes or other
5 equipment used in the operation of the taxpayer's business.
6 (a) If the corporate authorities of any home rule
7 municipality have adopted an ordinance that imposed a tax on
8 public utility customers, between July 1, 1971, and October
9 1, 1981, on the good faith belief that they were exercising
10 authority pursuant to Section 6 of Article VII of the 1970
11 Illinois Constitution, that action of the corporate
12 authorities shall be declared legal and valid,
13 notwithstanding a later decision of a judicial tribunal
14 declaring the ordinance invalid. No municipality shall be
15 required to rebate, refund, or issue credits for any taxes
16 described in this paragraph, and those taxes shall be deemed
17 to have been levied and collected in accordance with the
18 Constitution and laws of this State.
19 (b) In any case in which (i) prior to October 19, 1979,
20 the corporate authorities of any municipality have adopted an
21 ordinance imposing a tax authorized by this Section (or by
22 the predecessor provision of the "Revised Cities and Villages
23 Act") and have explicitly or in practice interpreted gross
24 receipts to include either charges added to customers' bills
25 pursuant to the provision of paragraph (a) of Section 36 of
26 the Public Utilities Act or charges added to customers' bills
27 by taxpayers who are not subject to rate regulation by the
28 Illinois Commerce Commission for the purpose of recovering
29 any of the tax liabilities or other amounts specified in such
30 paragraph (a) of Section 36 of that Act, and (ii) on or after
31 October 19, 1979, a judicial tribunal has construed gross
32 receipts to exclude all or part of those charges, then
33 neither those municipality nor any taxpayer who paid the tax
34 shall be required to rebate, refund, or issue credits for any
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1 tax imposed or charge collected from customers pursuant to
2 the municipality's interpretation prior to October 19, 1979.
3 This paragraph reflects a legislative finding that it would
4 be contrary to the public interest to require a municipality
5 or its taxpayers to refund taxes or charges attributable to
6 the municipality's more inclusive interpretation of gross
7 receipts prior to October 19, 1979, and is not intended to
8 prescribe or limit judicial construction of this Section. The
9 legislative finding set forth in this subsection does not
10 apply to taxes imposed after the effective date of this
11 amendatory Act of 1995.
12 (c) The tax authorized by subparagraph 3 shall be
13 collected from the purchaser by the person maintaining a
14 place of business in this State who delivers the electricity
15 to the purchaser. This tax shall constitute a debt of the
16 purchaser to the person who delivers the electricity to the
17 purchaser and if unpaid, is recoverable in the same manner as
18 the original charge for delivering the electricity. Any tax
19 required to be collected pursuant to an ordinance authorized
20 by subparagraph 3 and any such tax collected by a person
21 delivering electricity shall constitute a debt owed to the
22 municipality by such person delivering the electricity,
23 provided, that the person delivering electricity shall be
24 allowed credit for such tax related to deliveries of
25 electricity the charges for which are written off as
26 uncollectible, and provided further, that if such charges are
27 thereafter collected, the delivering supplier shall be
28 obligated to remit such tax. For purposes of this subsection
29 (c), any partial payment not specifically identified by the
30 purchaser shall be deemed to be for the delivery of
31 electricity. Persons delivering electricity shall collect the
32 tax from the purchaser by adding such tax to the gross charge
33 for delivering the electricity, in the manner prescribed by
34 the municipality. Persons delivering electricity shall also
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1 be authorized to add to such gross charge an amount equal to
2 3% of the tax to reimburse the person delivering electricity
3 for the expenses incurred in keeping records, billing
4 customers, preparing and filing returns, remitting the tax
5 and supplying data to the municipality upon request. If the
6 person delivering electricity fails to collect the tax from
7 the purchaser, then the purchaser shall be required to pay
8 the tax directly to the municipality in the manner prescribed
9 by the municipality. Persons delivering electricity who file
10 returns pursuant to this paragraph (c) shall, at the time of
11 filing such return, pay the municipality the amount of the
12 tax collected pursuant to subparagraph 3.
13 (d) For the purpose of the taxes enumerated in this
14 Section:
15 "Gross receipts" means the consideration received for the
16 transmission of messages, the consideration received for
17 distributing, supplying, furnishing or selling gas for use or
18 consumption and not for resale, and the consideration
19 received for distributing, supplying, furnishing or selling
20 water for use or consumption and not for resale, and for all
21 services rendered in connection therewith valued in money,
22 whether received in money or otherwise, including cash,
23 credit, services and property of every kind and material and
24 for all services rendered therewith, and shall be determined
25 without any deduction on account of the cost of transmitting
26 such messages, without any deduction on account of the cost
27 of the service, product or commodity supplied, the cost of
28 materials used, labor or service cost, or any other expenses
29 whatsoever. "Gross receipts" shall not include that portion
30 of the consideration received for distributing, supplying,
31 furnishing, or selling gas or water to, or for the
32 transmission of messages for, business enterprises described
33 in paragraph (e) of this Section to the extent and during the
34 period in which the exemption authorized by paragraph (e) is
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1 in effect or for school districts or units of local
2 government described in paragraph (f) during the period in
3 which the exemption authorized in paragraph (f) is in effect.
4 "Gross receipts" shall not include amounts paid by
5 telecommunications retailers under the Telecommunications
6 Municipal Infrastructure Maintenance Fee Act.
7 For utility bills issued on or after May 1, 1996, but
8 before May 1, 1997, and for receipts from those utility
9 bills, "gross receipts" does not include one-third of (i)
10 amounts added to customers' bills under Section 9-222 of the
11 Public Utilities Act, or (ii) amounts added to customers'
12 bills by taxpayers who are not subject to rate regulation by
13 the Illinois Commerce Commission for the purpose of
14 recovering any of the tax liabilities described in Section
15 9-222 of the Public Utilities Act. For utility bills issued
16 on or after May 1, 1997, but before May 1, 1998, and for
17 receipts from those utility bills, "gross receipts" does not
18 include two-thirds of (i) amounts added to customers' bills
19 under Section 9-222 of the Public Utilities Act, or (ii)
20 amount added to customers' bills by taxpayers who are not
21 subject to rate regulation by the Illinois Commerce
22 Commission for the purpose of recovering any of the tax
23 liabilities described in Section 9-222 of the Public
24 Utilities Act. For utility bills issued on or after May 1,
25 1998, and for receipts from those utility bills, "gross
26 receipts" does not include (i) amounts added to customers'
27 bills under Section 9-222 of the Public Utilities Act, or
28 (ii) amounts added to customers' bills by taxpayers who are
29 not subject to rate regulation by the Illinois Commerce
30 Commission for the purpose of recovering any of the tax
31 liabilities described in Section 9-222 of the Public
32 Utilities Act.
33 For purposes of this Section "gross receipts" shall not
34 include (i) amounts added to customers' bills under Section
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1 9-221 of the Public Utilities Act, or (ii) charges added to
2 customers' bills to recover the surcharge imposed under the
3 Emergency Telephone System Act. This paragraph is not
4 intended to nor does it make any change in the meaning of
5 "gross receipts" for the purposes of this Section, but is
6 intended to remove possible ambiguities, thereby confirming
7 the existing meaning of "gross receipts" prior to the
8 effective date of this amendatory Act of 1995.
9 The words "transmitting messages", in addition to the
10 usual and popular meaning of person to person communication,
11 shall include the furnishing, for a consideration, of
12 services or facilities (whether owned or leased), or both, to
13 persons in connection with the transmission of messages where
14 those persons do not, in turn, receive any consideration in
15 connection therewith, but shall not include such furnishing
16 of services or facilities to persons for the transmission of
17 messages to the extent that any such services or facilities
18 for the transmission of messages are furnished for a
19 consideration, by those persons to other persons, for the
20 transmission of messages.
21 "Person" as used in this Section means any natural
22 individual, firm, trust, estate, partnership, association,
23 joint stock company, joint adventure, corporation, limited
24 liability company, municipal corporation, the State or any of
25 its political subdivisions, any State university created by
26 statute, or a receiver, trustee, guardian or other
27 representative appointed by order of any court.
28 "Person maintaining a place of business in this State"
29 shall mean any person having or maintaining within this
30 State, directly or by a subsidiary or other affiliate, an
31 office, generation facility, distribution facility,
32 transmission facility, sales office or other place of
33 business, or any employee, agent, or other representative
34 operating within this State under the authority of the person
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1 or its subsidiary or other affiliate, irrespective of whether
2 such place of business or agent or other representative is
3 located in this State permanently or temporarily, or whether
4 such person, subsidiary or other affiliate is licensed or
5 qualified to do business in this State.
6 "Public utility" shall have the meaning ascribed to it in
7 Section 3-105 of the Public Utilities Act and shall include
8 telecommunications carriers as defined in Section 13-202 of
9 that Act and alternative retail electric suppliers as defined
10 in Section 16-102 of that Act.
11 "Purchase at retail" shall mean any acquisition of
12 electricity by a purchaser for purposes of use or
13 consumption, and not for resale, but shall not include the
14 use of electricity by a public utility directly in the
15 generation, production, transmission, delivery or sale of
16 electricity.
17 "Purchaser" shall mean any person who uses or consumes,
18 within the corporate limits of the municipality, electricity
19 acquired in a purchase at retail.
20 In the case of persons engaged in the business of
21 transmitting messages through the use of mobile equipment,
22 such as cellular phones and paging systems, the gross
23 receipts from the business shall be deemed to originate
24 within the corporate limits of a municipality only if the
25 address to which the bills for the service are sent is within
26 those corporate limits. If, however, that address is not
27 located within a municipality that imposes a tax under this
28 Section, then (i) if the party responsible for the bill is
29 not an individual, the gross receipts from the business shall
30 be deemed to originate within the corporate limits of the
31 municipality where that party's principal place of business
32 in Illinois is located, and (ii) if the party responsible for
33 the bill is an individual, the gross receipts from the
34 business shall be deemed to originate within the corporate
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1 limits of the municipality where that party's principal
2 residence in Illinois is located.
3 (e) Any municipality that imposes taxes upon public
4 utilities or upon the privilege of using or consuming
5 electricity pursuant to this Section whose territory includes
6 any part of an enterprise zone or federally designated
7 Foreign Trade Zone or Sub-Zone may, by a majority vote of its
8 corporate authorities, exempt from those taxes for a period
9 not exceeding 20 years any specified percentage of gross
10 receipts of public utilities received from, or electricity
11 used or consumed by, business enterprises that:
12 (1) either (i) make investments that cause the
13 creation of a minimum of 200 full-time equivalent jobs in
14 Illinois, (ii) make investments of at least $175,000,000
15 that cause the creation of a minimum of 150 full-time
16 equivalent jobs in Illinois, or (iii) make investments
17 that cause the retention of a minimum of 1,000 full-time
18 jobs in Illinois; and
19 (2) are either (i) located in an Enterprise Zone
20 established pursuant to the Illinois Enterprise Zone Act
21 or (ii) Department of Commerce and Community Affairs
22 designated High Impact Businesses located in a federally
23 designated Foreign Trade Zone or Sub-Zone; and
24 (3) are certified by the Department of Commerce and
25 Community Affairs as complying with the requirements
26 specified in clauses (1) and (2) of this paragraph (e).
27 Upon adoption of the ordinance authorizing the exemption,
28 the municipal clerk shall transmit a copy of that ordinance
29 to the Department of Commerce and Community Affairs. The
30 Department of Commerce and Community Affairs shall determine
31 whether the business enterprises located in the municipality
32 meet the criteria prescribed in this paragraph. If the
33 Department of Commerce and Community Affairs determines that
34 the business enterprises meet the criteria, it shall grant
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1 certification. The Department of Commerce and Community
2 Affairs shall act upon certification requests within 30 days
3 after receipt of the ordinance.
4 Upon certification of the business enterprise by the
5 Department of Commerce and Community Affairs, the Department
6 of Commerce and Community Affairs shall notify the Department
7 of Revenue of the certification. The Department of Revenue
8 shall notify the public utilities of the exemption status of
9 the gross receipts received from, and the electricity used or
10 consumed by, the certified business enterprises. Such
11 exemption status shall be effective within 3 months after
12 certification.
13 (f) A municipality that imposes taxes upon public
14 utilities or upon the privilege of using or consuming
15 electricity under this Section and whose territory includes
16 part of another unit of local government or a school district
17 may by ordinance exempt the other unit of local government or
18 school district from those taxes.
19 (g) The amendment of this Section by Public Act 84-127
20 shall take precedence over any other amendment of this
21 Section by any other amendatory Act passed by the 84th
22 General Assembly before the effective date of Public Act
23 84-127.
24 (h) In any case in which, before July 1, 1992, a person
25 engaged in the business of transmitting messages through the
26 use of mobile equipment, such as cellular phones and paging
27 systems, has determined the municipality within which the
28 gross receipts from the business originated by reference to
29 the location of its transmitting or switching equipment, then
30 (i) neither the municipality to which tax was paid on that
31 basis nor the taxpayer that paid tax on that basis shall be
32 required to rebate, refund, or issue credits for any such tax
33 or charge collected from customers to reimburse the taxpayer
34 for the tax and (ii) no municipality to which tax would have
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1 been paid with respect to those gross receipts if the
2 provisions of this amendatory Act of 1991 had been in effect
3 before July 1, 1992, shall have any claim against the
4 taxpayer for any amount of the tax.
5 (i) Beginning on January 1, 2002, the tax authorized by
6 this Section and all civil penalties that are assessed as an
7 incident thereof by a municipality with a population of less
8 than 500,000 shall be collected and enforced by the
9 Department of Revenue. The Department has the full power to
10 administer and enforce this Section, to collect all taxes and
11 penalties due under this Section, to dispose of taxes and
12 penalties in the manner provided for in this Section, and to
13 determine all rights to credit memoranda arising on account
14 of the erroneous payment of a tax or penalty under this
15 Section.
16 In the administration of, and compliance with, this
17 Section, the Department and persons who are subject to this
18 Section have the same rights, remedies, privileges,
19 immunities, powers, and duties; are subject to the same
20 conditions, restrictions, limitations, penalties, and
21 definitions of terms; and shall employ the same procedures,
22 as in Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j, 2 through
23 2-65 (except as to the rate of tax), 2c, 3 (except as to the
24 disposition of taxes and penalties collected), 4, 5, 5a, 5b,
25 5c, 5d, 5e, 5f, 5g, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9,
26 10, 11, 12, and 13 of the Retailers' Occupation Tax Act as
27 fully as if those provisions were set forth in this Act.
28 Whenever the Department determines that a refund should
29 be made under this Section to a claimant instead of issuing a
30 credit memorandum, the Department shall notify the State
31 Comptroller, who shall cause the order to be drawn for the
32 amount specified and to the person named in the notification.
33 The refund shall be paid by the State Treasurer out the
34 Non-Home Rule Municipal Retailers' Occupation Tax Fund.
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1 The Department shall pay over the State Treasurer, as
2 trustee, all taxes and penalties collected under this Section
3 on or before the 25th day of each calendar month. The
4 Department shall prepare and certify to the Comptroller the
5 disbursement of stated sums of money to the municipalities
6 from which retailers have paid taxes or penalties under this
7 Section during the second preceding calendar month. The
8 amount paid to each municipality shall be the amount (not
9 including credit memoranda) collected during the second
10 preceding calendar month by the Department plus an amount
11 that the Department determines is necessary to offset any
12 amounts that were erroneously paid to a different taxing
13 body, and not including an amount equal to the amount of
14 refunds made during the second preceding calendar month by
15 the Department on behalf of the municipality and not
16 including any amount that the Department determines is
17 necessary to offset any amounts that were payable to a
18 different taxing body but were erroneously paid to the
19 municipality. Within 10 days after the Comptroller receives
20 the disbursement certification, the Comptroller shall cause
21 the orders to be drawn for the respective amounts in
22 accordance with the directions in the certification.
23 When certifying the amount of the monthly disbursement to
24 a municipality, the Department shall increase or decrease the
25 amount by an amount necessary to offset any misallocation of
26 previous disbursements. The offset amount shall be the amount
27 erroneously disbursed within the previous 6 months from the
28 time a misallocation is discovered.
29 (Source: P.A. 89-325, eff. 1-1-96; 90-16, eff. 6-16-97;
30 90-561, eff. 8-1-98; 90-562, eff. 12-16-97; 90-655, eff.
31 7-30-98.)
32 (65 ILCS 5/8-11-17) (from Ch. 24, par. 8-11-17)
33 Sec. 8-11-17. Municipal telecommunications tax.
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1 (a) Beginning on the effective date of this amendatory
2 Act of 1991, the corporate authorities of any municipality in
3 this State may tax any or all of the following acts or
4 privileges:
5 (1) The act or privilege of originating in such
6 municipality or receiving in such municipality intrastate
7 telecommunications by a person at a rate not to exceed 5%
8 of the gross charge for such telecommunications purchased
9 at retail from a retailer by such person. However, such
10 tax is not imposed on such act or privilege to the extent
11 such act or privilege may not, under the Constitution and
12 statutes of the United States, be made the subject of
13 taxation by municipalities in this State.
14 (2) The act or privilege of originating in such
15 municipality or receiving in such municipality interstate
16 telecommunications by a person at a rate not to exceed 5%
17 of the gross charge for such telecommunications purchased
18 at retail from a retailer by such person. To prevent
19 actual multi-state taxation of the act or privilege that
20 is subject to taxation under this paragraph, any
21 taxpayer, upon proof that the taxpayer has paid a tax in
22 another state on such event, shall be allowed a credit
23 against any tax enacted pursuant to an ordinance
24 authorized by this paragraph to the extent of the amount
25 of such tax properly due and paid in such other state
26 which was not previously allowed as a credit against any
27 other state or local tax in this State. However, such
28 tax is not imposed on the act or privilege to the extent
29 such act or privilege may not, under the Constitution and
30 statutes of the United States, be made the subject of
31 taxation by municipalities in this State.
32 (3) The taxes authorized by paragraphs (1) and (2)
33 of subsection (a) of this Section may only be levied if
34 such municipality does not then have in effect an
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1 occupation tax imposed on persons engaged in the business
2 of transmitting messages by means of electricity as
3 authorized by Section 8-11-2 of the Illinois Municipal
4 Code.
5 (b) Except as otherwise provided in subsection (g), the
6 tax authorized by this Section shall be collected from the
7 taxpayer by a retailer maintaining a place of business in
8 this State and making or effectuating the sale at retail and
9 shall be remitted by such retailer to the municipality. Any
10 tax required to be collected pursuant to an ordinance
11 authorized by this Section and any such tax collected by such
12 retailer shall constitute a debt owed by the retailer to such
13 municipality or, in the case of taxes collected after
14 December 31, 2001, to the Department of Revenue. Except as
15 otherwise provided in subsection (g), retailers shall collect
16 the tax from the taxpayer by adding the tax to the gross
17 charge for the act or privilege of originating or receiving
18 telecommunications when sold for use, in the manner
19 prescribed by the municipality. The tax authorized by this
20 Section shall constitute a debt of the purchaser to the
21 retailer who provides such taxable services until paid and,
22 if unpaid, is recoverable at law in the same manner as the
23 original charge for such taxable services. If the retailer
24 fails to collect the tax from the taxpayer, then the taxpayer
25 shall be required to pay the tax directly to the municipality
26 in the manner provided by the municipality or, in the case of
27 liabilities incurred after December 31, 2001, the taxpayer
28 shall be required to pay the tax directly to the Department
29 of Revenue. Except as otherwise provided in subsection (g),
30 the municipality imposing the tax shall provide for its
31 administration and enforcement.
32 Beginning January 1, 1994, retailers filing tax returns
33 pursuant to this Section shall, at the time of filing such
34 return, pay to the municipality the amount of the tax imposed
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1 by this Section, less a commission of 1.75% which is allowed
2 to reimburse the retailer for the expenses incurred in
3 keeping records, billing the customer, preparing and filing
4 returns, remitting the tax and supplying data to the
5 municipality upon request. Beginning January 1, 2002,
6 retailers filing tax returns under subsection (g) of this
7 Section shall, at the time of filing the return, pay to the
8 Department of Revenue the amount of tax imposed by this
9 Section less a commission of 1.5%. No commission may be
10 claimed by a retailer for tax not timely remitted to the
11 municipality or the Department of Revenue, as the case may
12 be.
13 Whenever possible, the tax authorized by this Section
14 shall, when collected, be stated as a distinct item separate
15 and apart from the gross charge for telecommunications.
16 (c) For the purpose of the taxes authorized by this
17 Section:
18 (1) "Amount paid" means the amount charged to the
19 taxpayer's service address in such municipality
20 regardless of where such amount is billed or paid.
21 (2) "Gross charge" means the amount paid for the
22 act or privilege of originating or receiving
23 telecommunications in such municipality and for all
24 services rendered in connection therewith, valued in
25 money whether paid in money or otherwise, including cash,
26 credits, services and property of every kind or nature,
27 and shall be determined without any deduction on account
28 of the cost of such telecommunications, the cost of the
29 materials used, labor or service costs or any other
30 expense whatsoever. In case credit is extended, the
31 amount thereof shall be included only as and when paid.
32 However, "gross charge" shall not include:
33 (A) any amounts added to a purchaser's bill
34 because of a charge made pursuant to: (i) the tax
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1 imposed by this Section, (ii) additional charges
2 added to a purchaser's bill pursuant to Section
3 9-222 of the Public Utilities Act, (iii) the tax
4 imposed by the Telecommunications Excise Tax Act, or
5 (iv) the tax imposed by Section 4251 of the Internal
6 Revenue Code;
7 (B) charges for a sent collect
8 telecommunication received outside of such
9 municipality;
10 (C) charges for leased time on equipment or
11 charges for the storage of data or information or
12 subsequent retrieval or the processing of data or
13 information intended to change its form or content.
14 Such equipment includes, but is not limited to, the
15 use of calculators, computers, data processing
16 equipment, tabulating equipment or accounting
17 equipment and also includes the usage of computers
18 under a time-sharing agreement;
19 (D) charges for customer equipment, including
20 such equipment that is leased or rented by the
21 customer from any source, wherein such charges are
22 disaggregated and separately identified from other
23 charges;
24 (E) charges to business enterprises certified
25 under Section 9-222.1 of the Public Utilities Act to
26 the extent of such exemption and during the period
27 of time specified by the Department of Commerce and
28 Community Affairs;
29 (F) charges for telecommunications and all
30 services and equipment provided in connection
31 therewith between a parent corporation and its
32 wholly owned subsidiaries or between wholly owned
33 subsidiaries when the tax imposed under this Section
34 has already been paid to a retailer and only to the
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1 extent that the charges between the parent
2 corporation and wholly owned subsidiaries or between
3 wholly owned subsidiaries represent expense
4 allocation between the corporations and not the
5 generation of profit for the corporation rendering
6 such service;
7 (G) bad debts ("bad debt" means any portion of
8 a debt that is related to a sale at retail for which
9 gross charges are not otherwise deductible or
10 excludable that has become worthless or
11 uncollectable, as determined under applicable
12 federal income tax standards; if the portion of the
13 debt deemed to be bad is subsequently paid, the
14 retailer shall report and pay the tax on that
15 portion during the reporting period in which the
16 payment is made);
17 (H) charges paid by inserting coins in
18 coin-operated telecommunication devices; or
19 (I) amounts paid by telecommunications
20 retailers under the Telecommunications Municipal
21 Infrastructure Maintenance Fee Act.
22 (3) "Interstate telecommunications" means all
23 telecommunications that either originate or terminate
24 outside this State.
25 (4) "Intrastate telecommunications" means all
26 telecommunications that originate and terminate within
27 this State.
28 (5) "Person" means any natural individual, firm,
29 trust, estate, partnership, association, joint stock
30 company, joint venture, corporation, limited liability
31 company, or a receiver, trustee, guardian or other
32 representative appointed by order of any court, the
33 Federal and State governments, including State
34 universities created by statute, or any city, town,
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1 county, or other political subdivision of this State.
2 (6) "Purchase at retail" means the acquisition,
3 consumption or use of telecommunications through a sale
4 at retail.
5 (7) "Retailer" means and includes every person
6 engaged in the business of making sales at retail as
7 defined in this Section. A municipality may, in its
8 discretion, upon application, authorize the collection of
9 the tax hereby imposed by any retailer not maintaining a
10 place of business within this State, who to the
11 satisfaction of the municipality, furnishes adequate
12 security to insure collection and payment of the tax.
13 Such retailer shall be issued, without charge, a permit
14 to collect such tax. When so authorized, it shall be the
15 duty of such retailer to collect the tax upon all of the
16 gross charges for telecommunications in such municipality
17 in the same manner and subject to the same requirements
18 as a retailer maintaining a place of business within such
19 municipality.
20 (8) "Retailer maintaining a place of business in
21 this State", or any like term, means and includes any
22 retailer having or maintaining within this State,
23 directly or by a subsidiary, an office, distribution
24 facilities, transmission facilities, sales office,
25 warehouse or other place of business, or any agent or
26 other representative operating within this State under
27 the authority of the retailer or its subsidiary,
28 irrespective of whether such place of business or agent
29 or other representative is located here permanently or
30 temporarily, or whether such retailer or subsidiary is
31 licensed to do business in this State.
32 (9) "Sale at retail" means the transmitting,
33 supplying or furnishing of telecommunications and all
34 services rendered in connection therewith for a
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1 consideration, to persons other than the Federal and
2 State governments, and State universities created by
3 statute and other than between a parent corporation and
4 its wholly owned subsidiaries or between wholly owned
5 subsidiaries, when the tax has already been paid to a
6 retailer and the gross charge made by one such
7 corporation to another such corporation is not greater
8 than the gross charge paid to the retailer for their use
9 or consumption and not for resale.
10 (10) "Service address" means the location of
11 telecommunications equipment from which
12 telecommunications services are originated or at which
13 telecommunications services are received by a taxpayer.
14 If this is not a defined location, as in the case of
15 mobile phones, paging systems, maritime systems,
16 air-to-ground systems and the like, "service address"
17 shall mean the location of a taxpayer's primary use of
18 the telecommunication equipment as defined by telephone
19 number, authorization code, or location in Illinois where
20 bills are sent.
21 (11) "Taxpayer" means a person who individually or
22 through his agents, employees, or permittees engages in
23 the act or privilege of originating in such municipality
24 or receiving in such municipality telecommunications and
25 who incurs a tax liability under any ordinance authorized
26 by this Section.
27 (12) "Telecommunications", in addition to the usual
28 and popular meaning, includes, but is not limited to,
29 messages or information transmitted through use of local,
30 toll and wide area telephone service, channel services,
31 telegraph services, teletypewriter service, computer
32 exchange services; cellular mobile telecommunications
33 service, specialized mobile radio services, paging
34 service, or any other form of mobile and portable one-way
-27- LRB9111248MWpc
1 or two-way communications, or any other transmission of
2 messages or information by electronic or similar means,
3 between or among points by wire, cable, fiber optics,
4 laser, microwave, radio, satellite or similar facilities.
5 The definition of "telecommunications" shall not include
6 value added services in which computer processing
7 applications are used to act on the form, content, code
8 and protocol of the information for purposes other than
9 transmission. "Telecommunications" shall not include
10 purchase of telecommunications by a telecommunications
11 service provider for use as a component part of the
12 service provided by him to the ultimate retail consumer
13 who originates or terminates the taxable end-to-end
14 communications. Carrier access charges, right of access
15 charges, charges for use of inter-company facilities, and
16 all telecommunications resold in the subsequent provision
17 used as a component of, or integrated into, end-to-end
18 telecommunications service shall be non-taxable as sales
19 for resale.
20 (d) If a person, who originates or receives
21 telecommunications in such municipality claims to be a
22 reseller of such telecommunications, such person shall apply
23 to the municipality or the Department of Revenue, as the case
24 may be, for a resale number. Such applicant shall state
25 facts which will show the municipality or the Department why
26 such applicant is not liable for tax under any ordinance
27 authorized by this Section on any of such purchases and shall
28 furnish such additional information as the municipality or
29 Department may reasonably require.
30 Upon approval of the application, the municipality or the
31 Department of Revenue, as the case may be, shall assign a
32 resale number to the applicant and shall certify such number
33 to the applicant. The municipality or Department may cancel
34 any number which is obtained through misrepresentation, or
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1 which is used to send or receive such telecommunication
2 tax-free when such actions in fact are not for resale, or
3 which no longer applies because of the person's having
4 discontinued the making of resales.
5 Except as provided hereinabove in this Section, the act
6 or privilege of sending or receiving telecommunications in
7 this State shall not be made tax-free on the ground of being
8 a sale for resale unless the person has an active resale
9 number from the municipality and furnishes that number to the
10 retailer in connection with certifying to the retailer that
11 any sale to such person is non-taxable because of being a
12 sale for resale.
13 (e) A municipality that imposes taxes upon
14 telecommunications under this Section and whose territory
15 includes part of another unit of local government or a school
16 district may, by ordinance, exempt the other unit of local
17 government or school district from those taxes.
18 (f) A municipality that imposes taxes upon
19 telecommunications under this Section may, by ordinance, (i)
20 reduce the rate of the tax for persons 65 years of age or
21 older or (ii) exempt persons 65 years of age or older from
22 those taxes. Taxes related to such rate reductions or
23 exemptions shall be rebated from the municipality directly to
24 persons qualified for the rate reduction or exemption as
25 determined by the municipality's ordinance.
26 (g) Beginning on January 1, 2002, the tax authorized by
27 this Section and all civil penalties that are assessed as an
28 incident thereof by a municipality with a population of less
29 than 500,000 shall be collected and enforced by the
30 Department of Revenue. The Department has the full power to
31 administer and enforce this Section, to collect all taxes and
32 penalties due under this Section, to dispose of taxes and
33 penalties in the manner provided for in this Section, and to
34 determine all rights to credit memoranda arising on account
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1 of the erroneous payment of a tax or penalty under this
2 Section.
3 In the administration of, and compliance with, this
4 Section, the Department and persons who are subject to this
5 Section have the same rights, remedies, privileges,
6 immunities, powers, and duties; are subject to the same
7 conditions, restrictions, limitations, penalties, and
8 definitions of terms; and shall employ the same procedures as
9 in Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j, 2 through 2-65
10 (except as to the rate of tax), 2c, 3 (except as to the
11 disposition of taxes and penalties collected), 4, 5, 5a, 5b,
12 5c, 5d, 5e, 5f, 5g, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8, 9,
13 10, 11, 12, and 13 of the Retailers' Occupation Tax Act as
14 fully as if those provisions were set forth in this Act.
15 Whenever the Department determines that a refund should
16 be made under this Section to a claimant instead of issuing a
17 credit memorandum, the Department shall notify the State
18 Comptroller, who shall cause the order to be drawn for the
19 amount specified and to the person named in the notification.
20 The refund shall be paid by the State Treasurer out the
21 Non-Home Rule Municipal Retailers' Occupation Tax Fund.
22 The Department shall pay over the State Treasurer, as
23 trustee, all taxes and penalties collected under this Section
24 on or before the 25th day of each calendar month. The
25 Department shall prepare and certify to the Comptroller the
26 disbursement of stated sums of money to the municipalities
27 from which retailers have paid taxes or penalties under this
28 Section during the second preceding calendar month. The
29 amount paid to each municipality shall be the amount (not
30 including credit memoranda) collected during the second
31 preceding calendar month by the Department plus an amount
32 that the Department determines is necessary to offset any
33 amounts that were erroneously paid to a different taxing
34 body, and not including an amount equal to the amount of
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1 refunds made during the second preceding calendar month by
2 the Department on behalf of the municipality and not
3 including any amount that the Department determines is
4 necessary to offset any amounts that were payable to a
5 different taxing body but were erroneously paid to the
6 municipality. Within 10 days after the Comptroller receives
7 the disbursement certification, the Comptroller shall cause
8 the orders to be drawn for the respective amounts in
9 accordance with the directions in the certification.
10 When certifying the amount of the monthly disbursement to
11 a municipality, the Department shall increase or decrease the
12 amount by an amount necessary to offset any misallocation of
13 previous disbursements. The offset amount shall be the amount
14 erroneously disbursed within the previous 6 months from the
15 time a misallocation is discovered.
16 (Source: P.A. 90-357, eff. 1-1-98; 90-562, eff. 12-16-97.)
17 Section 99. Effective date. This Act takes effect July
18 1, 2000.