Illinois General Assembly - Full Text of Public Act 100-1006
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Public Act 100-1006


Public Act 1006 100TH GENERAL ASSEMBLY



Public Act 100-1006
HB4724 EnrolledLRB100 16404 HLH 31532 b

    AN ACT concerning revenue.
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
    Section 5. The Illinois Hydraulic Fracturing Tax Act is
amended by changing Section 2-30 as follows:
    (35 ILCS 450/2-30)
    Sec. 2-30. Payment and collection of tax.
    (a) For oil and gas removed on or after July 1, 2013, the
tax incurred under this Act shall be due and payable on or
before the last day of the month following the end of the month
in which the oil or gas is removed from the production unit.
The tax is upon the producers of such oil or gas in the
proportion to their respective beneficial interests at the time
of severance. The first purchaser of any oil or gas sold shall
collect the amount of the tax due from the producers by
deducting and withholding such amount from any payments made by
such purchaser to the producers and shall remit the tax in this
    In the event the tax shall be withheld by a purchaser from
payments due a producer and such purchaser fails to make
payment of the tax to the State as required herein, the first
purchaser shall be liable for the tax. However, in the event a
first purchaser fails to pay the tax withheld from a producer's
payment, the producer's interest remains subject to any lien
filed pursuant to subsection (c) of this Section. A producer
shall be entitled to bring an action against such purchaser to
recover the amount of tax so withheld together with penalties
and interest which may have accrued by failure to make such
payment. A producer shall be entitled to all attorney fees and
court costs incurred in such action. To the extent that a
producer liable for the tax imposed by this Act collects the
tax, and any penalties and interest, from a purchaser, such
tax, penalties, and interest are held in trust by the producer
for the benefit of the State of Illinois.
    (b) For all production units a first purchaser begins to
purchase oil or gas from on or after July 1, 2013, the first
purchaser is required to withhold and remit the tax imposed by
this Act to the Department from the oil and gas purchased from
the production unit unless the first purchaser obtains from the
operator an exemption certificate signed by the operator
stating that the production unit is not subject to the tax
imposed by this Act. The exemption certificate must include the
following information:
        (1) name and address of the operator;
        (2) name of the production unit;
        (3) number assigned to the production unit by the first
    purchaser, if available;
        (4) legal description of the production unit; and
        (5) a statement by the operator that the production
    unit is exempt from the tax imposed by the Illinois
    Hydraulic Fracturing Tax Act.
    If a first purchaser obtains an exemption certificate that
contains the required information and reasonably relies on the
exemption certificate and it is subsequently determined by the
Department that the production unit is subject to the tax
imposed by this Act, the Department will collect any tax that
is due from the operator and producers, and the first purchaser
is relieved of any liability.
    First purchasers shall not be required to obtain exemption
certificates from the operator until the first high volume
horizontal hydraulic fracturing permit has been approved by the
Department of Natural Resources after the effective date of
this amendatory Act of the 100th General Assembly.
    (c) Notwithstanding subsection (a) of this Section, the tax
is a lien on the oil and gas from the time of severance from the
land or under the water until the tax and all penalties and
interest are fully paid, and the State shall have a lien on all
the oil or gas severed from the production unit in this State
in the hands of the operator, any producer or the first or any
subsequent purchaser thereof to secure the payment of the tax.
If a lien is filed by the Department, the purchaser shall
withhold from producers or operators the amount of tax, penalty
and interest identified in the lien.
(Source: P.A. 98-22, eff. 6-17-13.)

Effective Date: 1/1/2019