HB5825 100TH GENERAL ASSEMBLY

LRB100 20825 AWJ 36317 b

100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB5825

Introduced , by Rep. Robert W. Pritchard

SYNOPSIS AS INTRODUCED:

See Index

Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides for filing of aviation fuel tax returns by retailers selling aviation fuel. Provides that if a municipality or business district doesn't certify that it has an airport-related purpose, the municipality's or district's local share of aviation fuel proceeds may not be distributed to the municipality or district. Amends the Illinois Municipal Code. Provides that funds received by a municipality from the imposition of taxes on the sale or use of aviation fuel may be used only for to expenditures for airport-related purposes. Defines "airport-related purposes". Provides that beginning July 1, 2018, the Department of Revenue shall certify to a municipality receiving distributions of use or occupation taxes imposed on aviation fuel the amount of tax attributed to aviation fuel sales as reported by retailers on aviation fuel tax returns to the Department of Revenue. Requires municipalities and business districts to certify whether the municipality has an airport-related purpose before imposing an occupation or use tax. Provides that beginning July 1, 2018, a municipality shall certify annually to the Department of Revenue that all of the municipality's expenditures of tax revenues generated from the sale or use of aviation fuel that were received on or after July 1, 2018 were devoted to airport-related purposes. Provides that the Department of Revenue shall provide forms and adopt rules for the filing of the certification. Limits the provisions' applicability only for so long as the revenue use requirements of specified federal statutes are binding on the State. Limits home rule powers.

FISCAL NOTE ACT MAY APPLY

HOME RULE NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning local government.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Use Tax Act is amended by adding Section 9.5 as follows:

(35 ILCS 105/9.5 new)

Sec. 9.5. Aviation fuel tax returns.

(a) As used in this Section, "aviation fuel" means a product that is intended for use or offered for sale as fuel for an aircraft.

(b) Notwithstanding any other provisions of this Act to the contrary:

(1) Beginning on January 1, 2018, each retailer required or authorized to collect the tax imposed by this Act on aviation fuel sold at retail in this State during the preceding calendar month shall, instead of reporting and paying tax on aviation fuel as otherwise required by Section 9, file and pay tax to the Department on an aviation fuel tax return, on or before the twentieth day of each calendar month. The requirements related to the return shall be as otherwise provided in Section 9. Retailers collecting tax on aviation fuel shall file all aviation fuel tax returns and shall make all aviation fuel fee payments by electronic means in the manner and form required by the Department.

(2) If a municipality or District has not certified to the Department of Transportation that the municipality or District has an airport-related purpose under subsection (d) of Section 8-11-22 of the Illinois Municipal Code, then the municipality's or District's local share of aviation fuel proceeds from aviation fuel tax returns under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act may not be distributed from the Local Government Tax Fund to the municipality or District.

Section 10. The Service Use Tax Act is amended by adding Section 9.5 as follows:

(35 ILCS 110/9.5 new)

Sec. 9.5. Aviation fuel tax returns.

(a) As used in this Section, "aviation fuel" means a product that is intended for use or offered for sale as fuel for an aircraft.

(b) Notwithstanding any other provisions of this Act to the contrary:

(1) Beginning on January 1, 2018, each retailer required or authorized to collect the tax imposed by this Act on aviation fuel sold at retail in this State during the preceding calendar month shall, instead of reporting and paying tax on aviation fuel as otherwise required by Section 9, file and pay tax to the Department on an aviation fuel tax return, on or before the twentieth day of each calendar month. The requirements related to the return shall be as otherwise provided in Section 9. Retailers collecting tax on aviation fuel shall file all aviation fuel tax returns and shall make all aviation fuel fee payments by electronic means in the manner and form required by the Department.

(2) If a municipality or District has not certified to the Department of Transportation that the municipality or District has an airport-related purpose under subsection (d) of Section 8-11-22 of the Illinois Municipal Code, then the municipality's or District's local share of aviation fuel proceeds from aviation fuel tax returns under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act may not be distributed from the Local Government Tax Fund to the municipality or District.

Section 15. The Service Occupation Tax Act is amended by adding Section 9.5 as follows:

(35 ILCS 115/9.5 new)

Sec. 9.5. Aviation fuel tax returns.

(a) As used in this Section, "aviation fuel" means a product that is intended for use or offered for sale as fuel for an aircraft.

(b) Notwithstanding any other provisions of this Act to the contrary:

(1) Beginning on January 1, 2018, each retailer required or authorized to collect the tax imposed by this Act on aviation fuel sold at retail in this State during the preceding calendar month shall, instead of reporting and paying tax on aviation fuel as otherwise required by Section 9, file and pay tax to the Department on an aviation fuel tax return, on or before the twentieth day of each calendar month. The requirements related to the return shall be as otherwise provided in Section 9. Retailers collecting tax on aviation fuel shall file all aviation fuel tax returns and shall make all aviation fuel fee payments by electronic means in the manner and form required by the Department.

(2) If a municipality or District has not certified to the Department of Transportation that the municipality or District has an airport-related purpose under subsection (d) of Section 8-11-22 of the Illinois Municipal Code, then the municipality's or District's local share of aviation fuel proceeds from aviation fuel tax returns under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act may not be distributed from the Local Government Tax Fund to the municipality or District.

Section 20. The Retailers' Occupation Tax Act is amended by adding Section 3.5 as follows:

(35 ILCS 120/3.5 new)

Sec. 3.5. Aviation fuel tax returns; aviation fuel local share.

(a) As used in this Section, "aviation fuel" means a product that is intended for use or offered for sale as fuel for an aircraft.

(b) Notwithstanding any other provisions of this Act to the contrary:

(1) Beginning on January 1, 2018, each retailer required or authorized to collect the tax imposed by this Act on aviation fuel sold at retail in this State during the preceding calendar month shall, instead of reporting and paying tax on aviation fuel as otherwise required by Section 3, file and pay tax to the Department on an aviation fuel tax return, on or before the twentieth day of each calendar month. The requirements related to the return shall be as otherwise provided in Section 3. Retailers collecting tax on aviation fuel shall file all aviation fuel tax returns and shall make all aviation fuel fee payments by electronic means in the manner and form required by the Department.

(2) If a municipality or District has not certified to the Department of Transportation that the municipality or District has an airport-related purpose under subsection (d) of Section 8-11-22 of the Illinois Municipal Code, then the municipality's or District's local share of aviation fuel proceeds from aviation fuel tax returns under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act may not be distributed from the Local Government Tax Fund to the municipality or District.

Section 25. The Illinois Municipal Code is amended by adding Section 8-11-22 as follows:

(65 ILCS 5/8-11-22 new)

Sec. 8-11-22. Aviation fuel revenue.

(a) As used in this Section, "airport-related purposes" means the capital or operating costs of (1) an airport, (2) a local airport system, or (3) any other local facility that is owned or operated by the person or entity that owns or operates the airport that is directly and substantially related to the air transportation of passengers or property as provided in 49 U.S.C. 47133. "Airport-related purposes" also means any permitted airfield costs, as that term is defined in the FAA Airport Compliance Manual, Order 5190.6B.

(b) Funds received by a municipality from the imposition of taxes on the sale or use of aviation fuel may be used only for expenditures for airport-related purposes.

(c) Beginning July 1, 2018, the Department of Revenue shall certify to a municipality receiving distributions of use or occupation taxes imposed on aviation fuel the amount of tax attributed to aviation fuel sales as reported by retailers on aviation fuel tax returns to the Department of Revenue.

(d) On or before April 1, 2018, and on or before each April 1 and October 1 thereafter, each municipality (and District in the case of business district operating within a municipality) must certify to the Department of Transportation, in the form and manner required by the Department, whether the municipality has an airport-related purpose, which would allow any Retailers' Occupation Tax and Service Occupation Tax imposed by the municipality to include tax on aviation fuel. On or before May 1, 2018, and on or before each May 1 and November 1 thereafter, the Department of Transportation shall provide to the Department of Revenue, a list of units of local government which have certified to the Department of Transportation that they have airport-related purposes, which would allow any Retailers' Occupation Tax and Service Occupation Tax imposed by the unit of local government to include tax on aviation fuel. All disputes regarding whether or not a unit of local government has an airport-related purpose shall be resolved by the Department of Transportation.

(e) Beginning July 1, 2018, a municipality shall certify annually to the Department of Revenue that all of the municipality's expenditures of tax revenues generated from the sale or use of aviation fuel were devoted to airport-related purposes. The Department of Revenue shall provide forms and adopt rules for the filing of the certification. The certification applies to all funds received for aviation fuel sold on or after July 1, 2018.

(f) This Section only applies for so long as the revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the State.

(g) A home rule municipality may not expend revenue received from the imposition of taxes on the sale or use of aviation fuel in a manner inconsistent with this Section and must provide certification to the Department of Revenue in a manner consistent with this Section. This Section is a limitation under subsection (i) of Section 6 of Article VII of the Illinois Constitution on the concurrent exercise by home rule units of powers and functions exercised by the State.