SB2298 101ST GENERAL ASSEMBLY

LRB101 14837 AWJ 63822 b

101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB2298

Introduced 11/6/2019, by Sen. Bill Cunningham

SYNOPSIS AS INTRODUCED:

65 ILCS 5/8-11-2.3

Amends the Illinois Municipal Code. Provides that the municipal motor fuel tax shall be imposed as a retailers' or service occupation tax. Prescribes conditions for reimbursement. Provides that any tax imposed, and all civil penalties that may be assessed as an incident thereof, shall be administered, collected, and enforced by the Department of Revenue in the same manner as the tax imposed under the Retailers' Occupation Tax Act. Effective immediately.

FISCAL NOTE ACT MAY APPLY

HOUSING AFFORDABILITY IMPACT 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 Illinois Municipal Code is amended by changing Section 8-11-2.3 as follows:

(65 ILCS 5/8-11-2.3)

Sec. 8-11-2.3. Municipal Motor Fuel Tax Law fuel tax. Notwithstanding any other provision of law, in addition to any other tax that may be imposed, a municipality in a county with a population of over 3,000,000 inhabitants may also impose, by ordinance, a tax upon all persons engaged in the municipality in the business of selling motor fuel, as that term is defined in Section 1.1 of the Motor Fuel Tax Law, at retail for the operation of motor vehicles upon public highways or for the operation of recreational watercraft upon waterways, including, but not limited to, persons who make sales of motor fuel incident to a sale of service. The tax may be imposed, in one cent increments, on motor fuel at a rate not to exceed $0.03 per gallon of motor fuel sold at retail within the municipality for the purpose of use or consumption and not for the purpose of resale. The tax may not be imposed under this Section on aviation fuel, as defined in Section 3 of the Retailers' Occupation Tax Act.

Persons subject to any tax imposed under the authority granted in this Section may reimburse themselves for their seller's tax liability under this Section by separately stating that tax as an additional charge, which charge may be stated in combination, in a single amount, with State tax which sellers are required to collect under the Use Tax Act, pursuant to such bracket schedules as the Department of Revenue may prescribe.

A tax imposed under this Section, and all civil penalties that may be assessed as an incident thereof, shall be administered, collected, and enforced by the Department of Revenue in the same manner as the tax imposed under the Retailers' Occupation Tax Act insofar as may be practicable; except that, in the event of a conflict with the provisions of this Section, this Section shall control. The Department shall have full power to: administer and enforce this Section; collect all taxes and penalties due under this Section; dispose of taxes and penalties so collected in the manner provided in this Section; and determine all rights to credit memoranda arising on account of the erroneous payment of tax or penalty under this Section.

Whenever the Department determines that a refund shall be made under this Section to a claimant instead of issuing a credit memorandum, the Department shall notify the State Comptroller, who shall cause the order to be drawn for the amount specified, and to the person named, in the notification from the Department. The refund shall be paid by the State Treasurer out of the Municipal Motor Fuel Tax Fund.

A license that is issued to a distributor or a receiver under the Motor Fuel Tax Law shall permit that distributor or receiver to act as a distributor or receiver, as applicable, under this Section. The provisions of Sections 2b, 2d, 6, 6a, 12, 12a, 13, 13a.2, 13a.7, 13a.8, 15.1, and 21 of the Motor Fuel Tax Law that are not inconsistent with this Section shall apply as far as practicable to the subject matter of this Section to the same extent as if those provisions were included in this Section.

The Department shall immediately pay over to the State Treasurer, ex officio, as trustee, all taxes and penalties collected under this Section. Those taxes and penalties shall be deposited into the Municipal Motor Fuel Tax Fund, a trust fund created in the State treasury. Moneys in the Municipal Motor Fuel Tax Fund shall be used to make payments to municipalities and for the payment of refunds under this Section.

On or before the 25th day of each calendar month, the Department shall prepare and certify to the State Comptroller the disbursement of stated sums of money to named municipalities for which taxpayers have paid taxes or penalties under this Section to the Department during the second preceding calendar month. The amount to be paid to each municipality shall be the amount (not including credit memoranda) collected under this Section from retailers and servicemen within the municipality during the second preceding calendar month by the Department from the tax imposed by that municipality under this Section during the second preceding calendar month, plus an amount the Department determines is necessary to offset amounts that were erroneously paid to a different municipality, and not including an amount equal to the amount of refunds made during the second preceding calendar month by the Department on behalf of the municipality, and not including any amount that the Department determines is necessary to offset any amounts that were payable to a different municipality but were erroneously paid to the municipality, less 1.5% of the remainder, which the Department shall transfer into the Tax Compliance and Administration Fund. The Department, at the time of each monthly disbursement, shall prepare and certify to the State Comptroller the amount to be transferred into the Tax Compliance and Administration Fund under this Section. Within 10 days after receipt by the Comptroller of the disbursement certification to the municipalities and the Tax Compliance and Administration Fund provided for in this Section to be given to the Comptroller by the Department, the Comptroller shall cause the orders to be drawn for the respective amounts in accordance with the directions contained in the certification.

Nothing in this Section shall be construed to authorize a municipality to impose a tax upon the privilege of engaging in any business which under the Constitution of the United States may not be made the subject of taxation by this State.

An ordinance or resolution imposing or discontinuing the tax under this Section or effecting a change in the rate of the tax shall either: (i) be adopted and a certified copy of the ordinance or resolution be filed with the Department on or before April 1, whereupon the Department shall proceed to administer and enforce this Section as of the July 1 next following the adoption and filing; or (ii) be adopted and a certified copy of the ordinance or resolution be filed with the Department on or before October 1, whereupon the Department shall proceed to administer and enforce this Section as of the January 1 next following the adoption and filing.

An ordinance adopted in accordance with the provisions of this Section in effect before the effective date of this amendatory Act of the 101st General Assembly and filed with the Department of Revenue on or before January 1, 2020 shall be deemed to impose the tax, effective on April 1, 2020, in accordance with the provisions of this Section as amended by this amendatory Act of the 101st General Assembly and shall be administered by the Department of Revenue, effective April 1, 2020, in accordance with the provisions of this Section as amended by this amendatory Act of the 101st General Assembly; provided that, on or before October 1, 2020, the municipality adopts and files a certified copy of a superseding ordinance that imposes the tax in accordance with the provisions of this Section as amended by this amendatory Act of the 101st General Assembly. If a superseding ordinance is not so adopted and filed, then the tax imposed in accordance with the provisions of this Section in effect before the effective date of this amendatory Act of the 101st General Assembly shall be discontinued on January 1, 2021.

This Section may be cited as the Municipal Motor Fuel Tax Law.

(Source: P.A. 101-32, eff. 6-28-19.)

Section 99. Effective date. This Act takes effect upon becoming law.