Section 471.101  Definitions

 

"Delivering supplier maintaining a place of business in this State", or any like term, means any delivering supplier having or maintaining within this State, directly or by a subsidiary, an office, distribution facility, sales office or other place of business, or any employee, agent or other representative operating within this State under the authority of such delivering supplier or such delivering supplier's subsidiary, irrespective of whether such place of business or agent or other representative is located in this State permanently or temporarily, or whether such delivering supplier or such delivering supplier's subsidiary is licensed to do business in this State.

 

"Delivering supplier" means any person engaged in the business of delivering gas to persons for use or consumption and not for resale, and who, in any case where more than one person participates in the delivery of gas to a specific purchaser, is the last of the suppliers engaged in delivering the gas prior to its receipt by the purchaser.  A person, such as a gas utility, that provides for the delivery of customer owned gas through gas lines that are connected to the customer’s residence or place of business is considered a delivering supplier.  A person who transports gas through an interstate pipeline directly to a customer in this State who uses that gas for its own use or consumption and not for resale is considered a delivering supplier.  A person who sells gas to an end user, but does not provide for delivery of the gas to such end user, is not considered a delivering supplier.

 

EXAMPLE:  A customer purchases gas for use in its business from a gas marketer and has the customer’s local utility company deliver the gas to that customer’s place of business.  In that instance, the customer’s local utility company is the delivering supplier.

 

"Department" means the Department of Revenue of the State of Illinois.

 

"Gas" means any gaseous fuel distributed through a pipeline system.

 

"Law" means the Gas Use Tax Law [35 ILCS 173].

 

"Person" means any natural individual, firm, trust, estate, partnership, association, joint stock company, joint adventure, corporation, or a receiver, trustee, guardian, or other representative appointed by order of any court, or any city, town, county, or other political subdivision of this State.

 

"Purchase of out-of-State gas" means a transaction for the purchase of gas from any supplier in a manner that does not subject the seller of that gas to liability under the Gas Revenue Tax Act [35 ILCS 615].

 

"Purchase price" means the consideration paid for the distribution, supply, furnishing, sale, transportation, or delivery of gas to a person for use or consumption and not for resale, and for all services directly related to the production, transportation, or distribution of gas distributed, supplied, furnished, sold, transmitted, or delivered for use or consumption, including cash, services, and property of every kind and nature.  However, "purchase price" shall not include consideration paid for:

 

Any charge for a dishonored check.

           

Any finance or credit charge, penalty, charge for delayed payment, or discount for prompt payment.

 

Any charge for reconnection of service or for replacement or relocation of facilities.

 

Any advance or contribution in aid of construction.

 

Repair, inspection, or servicing of equipment located on customer premises.

 

Leasing or rental of equipment, the leasing or rental of which is not necessary to furnishing, supplying, or selling gas.

 

Any purchase by a purchaser if the supplier is prohibited by federal or State constitution, treaty, convention, statute, or court decision from recovering the related tax liability from such purchaser.

 

Any amounts added to purchasers' bills because of changes made pursuant to the tax imposed by the Law.

 

In case credit is extended, the amount thereof shall be included only as and when payments are received.

 

"Self-assessing purchaser" means a purchaser of gas for use or consumption that is required to be registered with the Department and is responsible for filing returns and paying the tax imposed under the Law directly to the Department. [35 ILCS 173/5-5]

 

Section 471.105  Imposition of Tax

 

Beginning October 1, 2003, a tax is imposed upon the privilege of using in this State gas obtained in a purchase of out-of-State gas at the rate or rates set forth in Section 471.110 of this Part.  [35 ILCS 173/5-10]

 

EXAMPLE:  A purchase of out-of-State gas occurs when a purchaser enters into a contract outside of this State with a supplier to purchase gas at a wellhead located in Oklahoma.  The purchaser then contracts with an Illinois utility for the delivery of that gas to the purchaser’s place of business in Illinois.  The sale of that gas occurs outside of this State and the seller is not liable for Gas Revenue Tax on the sale of that gas.  Unless otherwise exempt under this Part, the purchaser incurs Gas Use Tax liability at the rate or rates set forth in Section 471.110 of this Part on the purchase of the out-of-State gas.

 

Section 471.110  Tax Rates

 

a)         Self-assessing purchaser rate.  The tax imposed under Section 471.105 of this Part is at the rate of 2.4 cents per therm or 5% of the purchase price for the billing period, whichever is the lower rate. [35 ILCS 173/5-10]  This rate is referred to as the "self assessing purchaser tax rate" and such purchasers are referred to as "self-assessing purchasers".  Such self-assessing purchasers are required to file returns and pay the tax directly to the Department.  Purchasers of out-of-State gas who provide exemption certificates when they do not qualify for such exemptions will be deemed to be self-assessing purchasers and incur the tax imposed by this Part at the self-assessing purchaser rate. (See Section 471.125(c).)

 

b)         Alternate tax rate.  Purchasers of out-of-State gas may elect an alternative tax rate of 2.4 cents per therm.  This rate is referred to as the "alternate tax rate".  Those purchasers of out-of-State gas who elect the alternative tax rate do not file returns or pay the tax directly to the Department. [35 ILCS 173/5-10]  Such purchasers pay tax to their delivering suppliers who are registered to collect the tax under Section 471.120.

 

c)         Purchasers choosing not to register.  Purchasers of out-of-State gas who choose not to register with the Department as self-assessing purchasers will be deemed to have elected the alternate tax rate and must pay the tax to their delivering suppliers who are registered to collect the tax under Section 471.120.

 

Section 471.115  Self-Assessing Purchaser Registration

 

a)         Registration as a self-assessing purchaser.  Any purchaser that does not pay tax to his or her delivering supplier, when that delivering supplier is registered to collect that tax under the provisions of Section 471.120, must register with the Department as a self-assessing purchaser and pay tax directly to the Department at the self-assessing purchaser rate.  A purchaser registering as a self-assessing purchaser cannot revoke that registration for at least one year.

 

b)         Application for registration.  A signed application for a certificate of registration as a self-assessing purchaser shall be made to the Department upon forms furnished by the Department and shall list:

 

1)         the applicant’s name, including corporate name if applicable, address, and telephone number;

 

2)         the applicant’s Social Security number if the applicant is an individual or Illinois Business Tax number and Federal Employer Identification number if the applicant is a business; and

 

3)         the name or names of the delivering supplier or suppliers who are delivering the gas upon which the self-assessing purchaser will be paying tax.

 

c)         Issuance of certificate of registration.  Upon receipt of the application for a certificate of registration in proper form, the Department shall issue to the applicant a certificate of registration as a self-assessing purchaser.  The applicant shall provide a copy of such certificate of registration as a self-assessing purchaser to the applicant’s delivering supplier or suppliers.  Upon receipt of such a certificate of registration, the delivering supplier or suppliers will no longer collect the tax imposed under this Part from the self-assessing purchaser beginning with bills issued to the self-assessing purchaser 30 or more days after receipt of the copy of the certificate of registration.  The self-assessing purchaser shall begin self-assessing tax with the first bill issued by that person’s delivering supplier on or after October 1, 2003 that does not contain a charge for the collection of Gas Use Tax.

 

d)         Purchaser’s revocation of self-assessing purchaser registrations. Purchasers who have been filing returns and paying tax directly to the Department as self-assessing purchasers for at least one year may revoke their self-assessing purchaser registrations and pay tax to their delivering suppliers. Self-assessing purchasers who wish to revoke their registrations with the Department must provide the Department with at least 30 days written notice prior to the date upon which such purchasers wish to revoke their registrations. The notice provided to the Department must be on a form provided by the Department and include the name and address of the purchaser’s delivering supplier or suppliers. Upon receipt of such form, the Department shall provide written notification to the purchaser’s delivering supplier or suppliers that they are to begin collecting tax from such purchaser beginning with bills issued to the purchaser after that purchaser’s self-assessing purchaser registration has been revoked.

 

Section 471.120  Delivering Suppliers, Collection of Tax, Returns

 

a)         Collection of tax.  Beginning with bills issued on and after October 1, 2003, a delivering supplier maintaining a place of business in this State shall collect, from the purchasers who have elected the alternate tax rate, the tax that is imposed by this Part at the alternate 2.4 cents per therm rate.  The tax imposed at the alternate tax rate by this Part shall, when collected, be stated as a distinct and separate item apart from the selling price of the gas or related services.  Upon receipt by a delivering supplier of a copy of a certificate of registration issued to a self-assessing purchaser under Section 20 of the Law, that delivering supplier is relieved of the duty to collect the alternate tax from that self-assessing purchaser beginning with bills issued to that self-assessing purchaser 30 or more days after receipt of the copy of that certificate of registration.  Upon receipt by a delivering supplier of a signed exemption certificate provided by a customer as required under Section 471.125(b), that delivering supplier is relieved of the duty of collecting the tax from that customer. [35 ILCS 173/5-15]  However, the providing of such an exemption certificate by a customer for the tax imposed under this Part does not relieve the delivering supplier from any Gas Revenue Tax liability that may be incurred on transactions with that customer for the transportation or delivery of the gas. (See 86 Ill. Adm. Code 470.)  The delivering supplier’s duty to collect the alternate tax from a self-assessing purchaser will be reinstated upon the delivering supplier’s receipt of a notice of revocation of that purchaser’s self-assessing purchaser registration. (See Section 471.115.)

 

b)         Registration as a delivering supplier.  A delivering supplier maintaining a place of business in this State who engages in the delivery of gas in this State shall register with the Department. [35 ILCS 173/5-15]  A delivering supplier, if required to register under the Gas Revenue Tax Act [35 ILCS 615], need not obtain an additional certificate of registration under the Law, but shall be deemed to be sufficiently registered by virtue of his being registered under the Gas Revenue Tax Act [35 ILCS 615].  Application for a certificate of registration shall be made to the Department on a form prescribed by the Department.

 

c)         Delivering supplier returns.  Except as otherwise provided in this subsection (c), each delivering supplier who is required to collect the tax imposed under this Part shall, on or before the 15th day of each month for the preceding calendar month, file a return with the Department upon a form prescribed by the Department.  In completing such return, the delivering supplier may use any reasonable method to derive reportable "therms" from his or her billing and payment records.  If the average monthly liability to the Department of the delivering supplier does not exceed $100, the Department may authorize the delivering supplier’s returns to be filed on a quarter-annual basis, with the return for January, February, and March of a given year being due by April 30 of such year; with the return for April, May, and June of a given year being due by July 31 of such year; with the return for July, August, and September of a given year being due by October 31 of such year; and with the return for October, November, and December of a given year being due by January 31 of the following year.  If the average monthly liability to the Department of the delivering supplier does not exceed $20, the Department may authorize the delivering supplier’s returns to be filed on an annual basis, with the return for a given year being due by January 31 of the following year. [35 ILCS 173/5-25]

 

d)         Reporting tax.  Delivering suppliers who have not previously registered and remitted tax to the Department under the Gas Revenue Tax Act may choose to report tax under this Part by using either the gross billings or transactions method or gross receipts method.  Delivering suppliers who have previously filed returns and paid Gas Revenue Tax to the Department upon the basis of the gross amount of their billings or transactions with their customers shall file returns and pay the tax collected under this Part in the same manner.  Delivering suppliers who have previously filed returns and paid Gas Revenue Tax to the Department upon the basis of their gross receipts from their customers shall file returns and pay the tax collected under this Part in the same manner. (See Section 470.125.)

 

Section 471.125  Exemptions

 

a)         The tax imposed under this Part does not apply to the following:

 

1)         Gas used by business enterprises located in an enterprise zone certified by the Department of Commerce and Economic Opportunity pursuant to the Illinois Enterprise Zone Act [20 ILCS 655].  The use of gas by business enterprises under this exemption does not include gas that is used for any residential purpose;

 

2)         Gas used by governmental bodies, or a corporation, society, association, foundation, or institution organized and operated exclusively for charitable, religious, or educational purposes.  Such use shall not be exempt unless the government body, or corporation, society, association, foundation, or institution organized and operated exclusively for charitable, religious, or educational purposes has first been issued a tax exemption identification number by the Department of Revenue pursuant to Section 1g of the Retailers' Occupation Tax Act.  A limited liability company may qualify for this exemption only if the limited liability company is organized and operated exclusively for educational purposes.  The term "educational purposes" shall have the same meaning as that set forth in Section 2h of the Retailers' Occupation Tax Act [35 ILCS 120];

 

3)         Gas used in the production of electric energy.  This exemption does not include gas used in the general maintenance or heating of an electric energy production facility or other structure;

 

4)         Gas used in a petroleum refinery operation;

 

5)         Gas purchased by persons for use in liquefaction and fractionation processes that produce value added natural gas byproducts for resale; and

 

6)         Gas used in the production of anhydrous ammonia and downstream nitrogen fertilizer products for resale. [35 ILCS 173/5-50]

 

b)         Purchasers of gas that is to be used for an exempt purpose or purposes as provided in subsection (a) must provide their delivering supplier or suppliers with a signed certificate of exemption to claim an exemption from the tax imposed under this Part. Only one type of exemption described in subsection (a) may be claimed on each exemption certificate.  The certificate of exemption must contain the following:

 

1)         Name and address of the purchaser;

 

2)         Account number or numbers for which the exemption is being claimed;

 

3)         Type of exemption claimed (organizations described in subsection (a)(2) must provide their tax exemption identification number and persons or organizations claiming the exemption described in subsection (a)(1) must provide the name of the enterprise zone in which they are located);

 

4)         A statement that all of the gas being purchased by the purchaser under the account number or numbers listed on the certificate is exempt from tax;

 

5)         The date the certificate was given to the delivering supplier; and

 

6)         The signature of the purchaser.

 

c)         Purchasers providing invalid exemption certificates.  Purchasers of out-of-State gas who provide exemption certificates when they do not qualify for such exemptions will be deemed to be self-assessing purchasers and incur the tax imposed by this Part at the self-assessing purchaser rate.  Such purchasers must file returns and pay the tax directly to the Department.

 

d)         Separate accounts for exempt uses.  Purchasers who have both exempt uses and non-exempt uses of gas must have separate accounts with their delivering supplier or suppliers for their exempt gas usage.  An exemption certificate provided under this Section may only be provided for an account where all the gas being delivered to that customer under that account is exempt from tax under this Part.