103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB3475

 

Introduced 2/17/2023, by Rep. Abdelnasser Rashid

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-10
35 ILCS 110/3-10  from Ch. 120, par. 439.33-10
35 ILCS 115/3-10  from Ch. 120, par. 439.103-10
35 ILCS 120/2-10

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Reduces the rate of tax on diapers and baby wipes to 1% (currently, 6.25%).


LRB103 26897 HLH 53261 b

 

 

A BILL FOR

 

HB3475LRB103 26897 HLH 53261 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Sections
53-10 and 9 as follows:
 
6    (35 ILCS 105/3-10)
7    Sec. 3-10. Rate of tax. Unless otherwise provided in this
8Section, the tax imposed by this Act is at the rate of 6.25% of
9either the selling price or the fair market value, if any, of
10the tangible personal property. In all cases where property
11functionally used or consumed is the same as the property that
12was purchased at retail, then the tax is imposed on the selling
13price of the property. In all cases where property
14functionally used or consumed is a by-product or waste product
15that has been refined, manufactured, or produced from property
16purchased at retail, then the tax is imposed on the lower of
17the fair market value, if any, of the specific property so used
18in this State or on the selling price of the property purchased
19at retail. For purposes of this Section "fair market value"
20means the price at which property would change hands between a
21willing buyer and a willing seller, neither being under any
22compulsion to buy or sell and both having reasonable knowledge
23of the relevant facts. The fair market value shall be

 

 

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1established by Illinois sales by the taxpayer of the same
2property as that functionally used or consumed, or if there
3are no such sales by the taxpayer, then comparable sales or
4purchases of property of like kind and character in Illinois.
5    Beginning on July 1, 2000 and through December 31, 2000,
6with respect to motor fuel, as defined in Section 1.1 of the
7Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
8the Use Tax Act, the tax is imposed at the rate of 1.25%.
9    Beginning on August 6, 2010 through August 15, 2010, and
10beginning again on August 5, 2022 through August 14, 2022,
11with respect to sales tax holiday items as defined in Section
123-6 of this Act, the tax is imposed at the rate of 1.25%.
13    With respect to gasohol, the tax imposed by this Act
14applies to (i) 70% of the proceeds of sales made on or after
15January 1, 1990, and before July 1, 2003, (ii) 80% of the
16proceeds of sales made on or after July 1, 2003 and on or
17before July 1, 2017, and (iii) 100% of the proceeds of sales
18made thereafter. If, at any time, however, the tax under this
19Act on sales of gasohol is imposed at the rate of 1.25%, then
20the tax imposed by this Act applies to 100% of the proceeds of
21sales of gasohol made during that time.
22    With respect to majority blended ethanol fuel, the tax
23imposed by this Act does not apply to the proceeds of sales
24made on or after July 1, 2003 and on or before December 31,
252023 but applies to 100% of the proceeds of sales made
26thereafter.

 

 

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1    With respect to biodiesel blends with no less than 1% and
2no more than 10% biodiesel, the tax imposed by this Act applies
3to (i) 80% of the proceeds of sales made on or after July 1,
42003 and on or before December 31, 2018 and (ii) 100% of the
5proceeds of sales made after December 31, 2018 and before
6January 1, 2024. On and after January 1, 2024 and on or before
7December 31, 2030, the taxation of biodiesel, renewable
8diesel, and biodiesel blends shall be as provided in Section
93-5.1. If, at any time, however, the tax under this Act on
10sales of biodiesel blends with no less than 1% and no more than
1110% biodiesel is imposed at the rate of 1.25%, then the tax
12imposed by this Act applies to 100% of the proceeds of sales of
13biodiesel blends with no less than 1% and no more than 10%
14biodiesel made during that time.
15    With respect to biodiesel and biodiesel blends with more
16than 10% but no more than 99% biodiesel, the tax imposed by
17this Act does not apply to the proceeds of sales made on or
18after July 1, 2003 and on or before December 31, 2023. On and
19after January 1, 2024 and on or before December 31, 2030, the
20taxation of biodiesel, renewable diesel, and biodiesel blends
21shall be as provided in Section 3-5.1.
22    Until July 1, 2022 and beginning again on July 1, 2023,
23with respect to food for human consumption that is to be
24consumed off the premises where it is sold (other than
25alcoholic beverages, food consisting of or infused with adult
26use cannabis, soft drinks, and food that has been prepared for

 

 

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1immediate consumption), the tax is imposed at the rate of 1%.
2Beginning on July 1, 2022 and until July 1, 2023, with respect
3to food for human consumption that is to be consumed off the
4premises where it is sold (other than alcoholic beverages,
5food consisting of or infused with adult use cannabis, soft
6drinks, and food that has been prepared for immediate
7consumption), the tax is imposed at the rate of 0%.
8    With respect to prescription and nonprescription
9medicines, drugs, medical appliances, products classified as
10Class III medical devices by the United States Food and Drug
11Administration that are used for cancer treatment pursuant to
12a prescription, as well as any accessories and components
13related to those devices, modifications to a motor vehicle for
14the purpose of rendering it usable by a person with a
15disability, diapers, baby wipes, and insulin, blood sugar
16testing materials, syringes, and needles used by human
17diabetics, the tax is imposed at the rate of 1%. For the
18purposes of this Section, until September 1, 2009: the term
19"soft drinks" means any complete, finished, ready-to-use,
20non-alcoholic drink, whether carbonated or not, including, but
21not limited to, soda water, cola, fruit juice, vegetable
22juice, carbonated water, and all other preparations commonly
23known as soft drinks of whatever kind or description that are
24contained in any closed or sealed bottle, can, carton, or
25container, regardless of size; but "soft drinks" does not
26include coffee, tea, non-carbonated water, infant formula,

 

 

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1milk or milk products as defined in the Grade A Pasteurized
2Milk and Milk Products Act, or drinks containing 50% or more
3natural fruit or vegetable juice.
4    Notwithstanding any other provisions of this Act,
5beginning September 1, 2009, "soft drinks" means non-alcoholic
6beverages that contain natural or artificial sweeteners. "Soft
7drinks" does do not include beverages that contain milk or
8milk products, soy, rice or similar milk substitutes, or
9greater than 50% of vegetable or fruit juice by volume.
10    Until August 1, 2009, and notwithstanding any other
11provisions of this Act, "food for human consumption that is to
12be consumed off the premises where it is sold" includes all
13food sold through a vending machine, except soft drinks and
14food products that are dispensed hot from a vending machine,
15regardless of the location of the vending machine. Beginning
16August 1, 2009, and notwithstanding any other provisions of
17this Act, "food for human consumption that is to be consumed
18off the premises where it is sold" includes all food sold
19through a vending machine, except soft drinks, candy, and food
20products that are dispensed hot from a vending machine,
21regardless of the location of the vending machine.
22    Notwithstanding any other provisions of this Act,
23beginning September 1, 2009, "food for human consumption that
24is to be consumed off the premises where it is sold" does not
25include candy. For purposes of this Section, "candy" means a
26preparation of sugar, honey, or other natural or artificial

 

 

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1sweeteners in combination with chocolate, fruits, nuts or
2other ingredients or flavorings in the form of bars, drops, or
3pieces. "Candy" does not include any preparation that contains
4flour or requires refrigeration.
5    Notwithstanding any other provisions of this Act,
6beginning September 1, 2009, "nonprescription medicines and
7drugs" does not include grooming and hygiene products. For
8purposes of this Section, "grooming and hygiene products"
9includes, but is not limited to, soaps and cleaning solutions,
10shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
11lotions and screens, unless those products are available by
12prescription only, regardless of whether the products meet the
13definition of "over-the-counter-drugs". For the purposes of
14this paragraph, "over-the-counter-drug" means a drug for human
15use that contains a label that identifies the product as a drug
16as required by 21 CFR C.F.R. § 201.66. The
17"over-the-counter-drug" label includes:
18        (A) a A "Drug Facts" panel; or
19        (B) a A statement of the "active ingredient(s)" with a
20    list of those ingredients contained in the compound,
21    substance or preparation.
22    Beginning on January 1, 2014 (the effective date of Public
23Act 98-122) this amendatory Act of the 98th General Assembly,
24"prescription and nonprescription medicines and drugs"
25includes medical cannabis purchased from a registered
26dispensing organization under the Compassionate Use of Medical

 

 

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1Cannabis Program Act.
2    As used in this Section, "adult use cannabis" means
3cannabis subject to tax under the Cannabis Cultivation
4Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
5and does not include cannabis subject to tax under the
6Compassionate Use of Medical Cannabis Program Act.
7    If the property that is purchased at retail from a
8retailer is acquired outside Illinois and used outside
9Illinois before being brought to Illinois for use here and is
10taxable under this Act, the "selling price" on which the tax is
11computed shall be reduced by an amount that represents a
12reasonable allowance for depreciation for the period of prior
13out-of-state use.
14(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
15102-4, eff. 4-27-21; 102-700, Article 20, Section 20-5, eff.
164-19-22; 102-700, Article 60, Section 60-15, eff. 4-19-22;
17102-700, Article 65, Section 65-5, eff. 4-19-22; revised
185-27-22.)
 
19    Section 10. The Service Use Tax Act is amended by changing
20Sections 3-10 and 9 as follows:
 
21    (35 ILCS 110/3-10)  (from Ch. 120, par. 439.33-10)
22    Sec. 3-10. Rate of tax. Unless otherwise provided in this
23Section, the tax imposed by this Act is at the rate of 6.25% of
24the selling price of tangible personal property transferred as

 

 

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1an incident to the sale of service, but, for the purpose of
2computing this tax, in no event shall the selling price be less
3than the cost price of the property to the serviceman.
4    Beginning on July 1, 2000 and through December 31, 2000,
5with respect to motor fuel, as defined in Section 1.1 of the
6Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
7the Use Tax Act, the tax is imposed at the rate of 1.25%.
8    With respect to gasohol, as defined in the Use Tax Act, the
9tax imposed by this Act applies to (i) 70% of the selling price
10of property transferred as an incident to the sale of service
11on or after January 1, 1990, and before July 1, 2003, (ii) 80%
12of the selling price of property transferred as an incident to
13the sale of service on or after July 1, 2003 and on or before
14July 1, 2017, and (iii) 100% of the selling price thereafter.
15If, at any time, however, the tax under this Act on sales of
16gasohol, as defined in the Use Tax Act, is imposed at the rate
17of 1.25%, then the tax imposed by this Act applies to 100% of
18the proceeds of sales of gasohol made during that time.
19    With respect to majority blended ethanol fuel, as defined
20in the Use Tax Act, the tax imposed by this Act does not apply
21to the selling price of property transferred as an incident to
22the sale of service on or after July 1, 2003 and on or before
23December 31, 2023 but applies to 100% of the selling price
24thereafter.
25    With respect to biodiesel blends, as defined in the Use
26Tax Act, with no less than 1% and no more than 10% biodiesel,

 

 

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1the tax imposed by this Act applies to (i) 80% of the selling
2price of property transferred as an incident to the sale of
3service on or after July 1, 2003 and on or before December 31,
42018 and (ii) 100% of the proceeds of the selling price after
5December 31, 2018 and before January 1, 2024. On and after
6January 1, 2024 and on or before December 31, 2030, the
7taxation of biodiesel, renewable diesel, and biodiesel blends
8shall be as provided in Section 3-5.1 of the Use Tax Act. If,
9at any time, however, the tax under this Act on sales of
10biodiesel blends, as defined in the Use Tax Act, with no less
11than 1% and no more than 10% biodiesel is imposed at the rate
12of 1.25%, then the tax imposed by this Act applies to 100% of
13the proceeds of sales of biodiesel blends with no less than 1%
14and no more than 10% biodiesel made during that time.
15    With respect to biodiesel, as defined in the Use Tax Act,
16and biodiesel blends, as defined in the Use Tax Act, with more
17than 10% but no more than 99% biodiesel, the tax imposed by
18this Act does not apply to the proceeds of the selling price of
19property transferred as an incident to the sale of service on
20or after July 1, 2003 and on or before December 31, 2023. On
21and after January 1, 2024 and on or before December 31, 2030,
22the taxation of biodiesel, renewable diesel, and biodiesel
23blends shall be as provided in Section 3-5.1 of the Use Tax
24Act.
25    At the election of any registered serviceman made for each
26fiscal year, sales of service in which the aggregate annual

 

 

HB3475- 10 -LRB103 26897 HLH 53261 b

1cost price of tangible personal property transferred as an
2incident to the sales of service is less than 35%, or 75% in
3the case of servicemen transferring prescription drugs or
4servicemen engaged in graphic arts production, of the
5aggregate annual total gross receipts from all sales of
6service, the tax imposed by this Act shall be based on the
7serviceman's cost price of the tangible personal property
8transferred as an incident to the sale of those services.
9    Until July 1, 2022 and beginning again on July 1, 2023, the
10tax shall be imposed at the rate of 1% on food prepared for
11immediate consumption and transferred incident to a sale of
12service subject to this Act or the Service Occupation Tax Act
13by an entity licensed under the Hospital Licensing Act, the
14Nursing Home Care Act, the Assisted Living and Shared Housing
15Act, the ID/DD Community Care Act, the MC/DD Act, the
16Specialized Mental Health Rehabilitation Act of 2013, or the
17Child Care Act of 1969, or an entity that holds a permit issued
18pursuant to the Life Care Facilities Act. Until July 1, 2022
19and beginning again on July 1, 2023, the tax shall also be
20imposed at the rate of 1% on food for human consumption that is
21to be consumed off the premises where it is sold (other than
22alcoholic beverages, food consisting of or infused with adult
23use cannabis, soft drinks, and food that has been prepared for
24immediate consumption and is not otherwise included in this
25paragraph).
26    Beginning on July 1, 2022 and until July 1, 2023, the tax

 

 

HB3475- 11 -LRB103 26897 HLH 53261 b

1shall be imposed at the rate of 0% on food prepared for
2immediate consumption and transferred incident to a sale of
3service subject to this Act or the Service Occupation Tax Act
4by an entity licensed under the Hospital Licensing Act, the
5Nursing Home Care Act, the Assisted Living and Shared Housing
6Act, the ID/DD Community Care Act, the MC/DD Act, the
7Specialized Mental Health Rehabilitation Act of 2013, or the
8Child Care Act of 1969, or an entity that holds a permit issued
9pursuant to the Life Care Facilities Act. Beginning on July 1,
102022 and until July 1, 2023, the tax shall also be imposed at
11the rate of 0% on food for human consumption that is to be
12consumed off the premises where it is sold (other than
13alcoholic beverages, food consisting of or infused with adult
14use cannabis, soft drinks, and food that has been prepared for
15immediate consumption and is not otherwise included in this
16paragraph).
17    The tax shall also be imposed at the rate of 1% on
18prescription and nonprescription medicines, drugs, medical
19appliances, products classified as Class III medical devices
20by the United States Food and Drug Administration that are
21used for cancer treatment pursuant to a prescription, as well
22as any accessories and components related to those devices,
23modifications to a motor vehicle for the purpose of rendering
24it usable by a person with a disability, diapers, baby wipes,
25and insulin, blood sugar testing materials, syringes, and
26needles used by human diabetics. For the purposes of this

 

 

HB3475- 12 -LRB103 26897 HLH 53261 b

1Section, until September 1, 2009: the term "soft drinks" means
2any complete, finished, ready-to-use, non-alcoholic drink,
3whether carbonated or not, including, but not limited to, soda
4water, cola, fruit juice, vegetable juice, carbonated water,
5and all other preparations commonly known as soft drinks of
6whatever kind or description that are contained in any closed
7or sealed bottle, can, carton, or container, regardless of
8size; but "soft drinks" does not include coffee, tea,
9non-carbonated water, infant formula, milk or milk products as
10defined in the Grade A Pasteurized Milk and Milk Products Act,
11or drinks containing 50% or more natural fruit or vegetable
12juice.
13    Notwithstanding any other provisions of this Act,
14beginning September 1, 2009, "soft drinks" means non-alcoholic
15beverages that contain natural or artificial sweeteners. "Soft
16drinks" does do not include beverages that contain milk or
17milk products, soy, rice or similar milk substitutes, or
18greater than 50% of vegetable or fruit juice by volume.
19    Until August 1, 2009, and notwithstanding any other
20provisions of this Act, "food for human consumption that is to
21be consumed off the premises where it is sold" includes all
22food sold through a vending machine, except soft drinks and
23food products that are dispensed hot from a vending machine,
24regardless of the location of the vending machine. Beginning
25August 1, 2009, and notwithstanding any other provisions of
26this Act, "food for human consumption that is to be consumed

 

 

HB3475- 13 -LRB103 26897 HLH 53261 b

1off the premises where it is sold" includes all food sold
2through a vending machine, except soft drinks, candy, and food
3products that are dispensed hot from a vending machine,
4regardless of the location of the vending machine.
5    Notwithstanding any other provisions of this Act,
6beginning September 1, 2009, "food for human consumption that
7is to be consumed off the premises where it is sold" does not
8include candy. For purposes of this Section, "candy" means a
9preparation of sugar, honey, or other natural or artificial
10sweeteners in combination with chocolate, fruits, nuts or
11other ingredients or flavorings in the form of bars, drops, or
12pieces. "Candy" does not include any preparation that contains
13flour or requires refrigeration.
14    Notwithstanding any other provisions of this Act,
15beginning September 1, 2009, "nonprescription medicines and
16drugs" does not include grooming and hygiene products. For
17purposes of this Section, "grooming and hygiene products"
18includes, but is not limited to, soaps and cleaning solutions,
19shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
20lotions and screens, unless those products are available by
21prescription only, regardless of whether the products meet the
22definition of "over-the-counter-drugs". For the purposes of
23this paragraph, "over-the-counter-drug" means a drug for human
24use that contains a label that identifies the product as a drug
25as required by 21 CFR C.F.R. § 201.66. The
26"over-the-counter-drug" label includes:

 

 

HB3475- 14 -LRB103 26897 HLH 53261 b

1        (A) a A "Drug Facts" panel; or
2        (B) a A statement of the "active ingredient(s)" with a
3    list of those ingredients contained in the compound,
4    substance or preparation.
5    Beginning on January 1, 2014 (the effective date of Public
6Act 98-122), "prescription and nonprescription medicines and
7drugs" includes medical cannabis purchased from a registered
8dispensing organization under the Compassionate Use of Medical
9Cannabis Program Act.
10    As used in this Section, "adult use cannabis" means
11cannabis subject to tax under the Cannabis Cultivation
12Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
13and does not include cannabis subject to tax under the
14Compassionate Use of Medical Cannabis Program Act.
15    If the property that is acquired from a serviceman is
16acquired outside Illinois and used outside Illinois before
17being brought to Illinois for use here and is taxable under
18this Act, the "selling price" on which the tax is computed
19shall be reduced by an amount that represents a reasonable
20allowance for depreciation for the period of prior
21out-of-state use.
22(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
23102-4, eff. 4-27-21; 102-16, eff. 6-17-21; 102-700, Article
2420, Section 20-10, eff. 4-19-22; 102-700, Article 60, Section
2560-20, eff. 4-19-22; revised 6-1-22.)
 

 

 

HB3475- 15 -LRB103 26897 HLH 53261 b

1    Section 15. The Service Occupation Tax Act is amended by
2changing Sections 3-10 and 9 as follows:
 
3    (35 ILCS 115/3-10)  (from Ch. 120, par. 439.103-10)
4    Sec. 3-10. Rate of tax. Unless otherwise provided in this
5Section, the tax imposed by this Act is at the rate of 6.25% of
6the "selling price", as defined in Section 2 of the Service Use
7Tax Act, of the tangible personal property. For the purpose of
8computing this tax, in no event shall the "selling price" be
9less than the cost price to the serviceman of the tangible
10personal property transferred. The selling price of each item
11of tangible personal property transferred as an incident of a
12sale of service may be shown as a distinct and separate item on
13the serviceman's billing to the service customer. If the
14selling price is not so shown, the selling price of the
15tangible personal property is deemed to be 50% of the
16serviceman's entire billing to the service customer. When,
17however, a serviceman contracts to design, develop, and
18produce special order machinery or equipment, the tax imposed
19by this Act shall be based on the serviceman's cost price of
20the tangible personal property transferred incident to the
21completion of the contract.
22    Beginning on July 1, 2000 and through December 31, 2000,
23with respect to motor fuel, as defined in Section 1.1 of the
24Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
25the Use Tax Act, the tax is imposed at the rate of 1.25%.

 

 

HB3475- 16 -LRB103 26897 HLH 53261 b

1    With respect to gasohol, as defined in the Use Tax Act, the
2tax imposed by this Act shall apply to (i) 70% of the cost
3price of property transferred as an incident to the sale of
4service on or after January 1, 1990, and before July 1, 2003,
5(ii) 80% of the selling price of property transferred as an
6incident to the sale of service on or after July 1, 2003 and on
7or before July 1, 2017, and (iii) 100% of the cost price
8thereafter. If, at any time, however, the tax under this Act on
9sales of gasohol, as defined in the Use Tax Act, is imposed at
10the rate of 1.25%, then the tax imposed by this Act applies to
11100% of the proceeds of sales of gasohol made during that time.
12    With respect to majority blended ethanol fuel, as defined
13in the Use Tax Act, the tax imposed by this Act does not apply
14to the selling price of property transferred as an incident to
15the sale of service on or after July 1, 2003 and on or before
16December 31, 2023 but applies to 100% of the selling price
17thereafter.
18    With respect to biodiesel blends, as defined in the Use
19Tax Act, with no less than 1% and no more than 10% biodiesel,
20the tax imposed by this Act applies to (i) 80% of the selling
21price of property transferred as an incident to the sale of
22service on or after July 1, 2003 and on or before December 31,
232018 and (ii) 100% of the proceeds of the selling price after
24December 31, 2018 and before January 1, 2024. On and after
25January 1, 2024 and on or before December 31, 2030, the
26taxation of biodiesel, renewable diesel, and biodiesel blends

 

 

HB3475- 17 -LRB103 26897 HLH 53261 b

1shall be as provided in Section 3-5.1 of the Use Tax Act. If,
2at any time, however, the tax under this Act on sales of
3biodiesel blends, as defined in the Use Tax Act, with no less
4than 1% and no more than 10% biodiesel is imposed at the rate
5of 1.25%, then the tax imposed by this Act applies to 100% of
6the proceeds of sales of biodiesel blends with no less than 1%
7and no more than 10% biodiesel made during that time.
8    With respect to biodiesel, as defined in the Use Tax Act,
9and biodiesel blends, as defined in the Use Tax Act, with more
10than 10% but no more than 99% biodiesel material, the tax
11imposed by this Act does not apply to the proceeds of the
12selling price of property transferred as an incident to the
13sale of service on or after July 1, 2003 and on or before
14December 31, 2023. On and after January 1, 2024 and on or
15before December 31, 2030, the taxation of biodiesel, renewable
16diesel, and biodiesel blends shall be as provided in Section
173-5.1 of the Use Tax Act.
18    At the election of any registered serviceman made for each
19fiscal year, sales of service in which the aggregate annual
20cost price of tangible personal property transferred as an
21incident to the sales of service is less than 35%, or 75% in
22the case of servicemen transferring prescription drugs or
23servicemen engaged in graphic arts production, of the
24aggregate annual total gross receipts from all sales of
25service, the tax imposed by this Act shall be based on the
26serviceman's cost price of the tangible personal property

 

 

HB3475- 18 -LRB103 26897 HLH 53261 b

1transferred incident to the sale of those services.
2    Until July 1, 2022 and beginning again on July 1, 2023, the
3tax shall be imposed at the rate of 1% on food prepared for
4immediate consumption and transferred incident to a sale of
5service subject to this Act or the Service Use Tax Act by an
6entity licensed under the Hospital Licensing Act, the Nursing
7Home Care Act, the Assisted Living and Shared Housing Act, the
8ID/DD Community Care Act, the MC/DD Act, the Specialized
9Mental Health Rehabilitation Act of 2013, or the Child Care
10Act of 1969, or an entity that holds a permit issued pursuant
11to the Life Care Facilities Act. Until July 1, 2022 and
12beginning again on July 1, 2023, the tax shall also be imposed
13at the rate of 1% on food for human consumption that is to be
14consumed off the premises where it is sold (other than
15alcoholic beverages, food consisting of or infused with adult
16use cannabis, soft drinks, and food that has been prepared for
17immediate consumption and is not otherwise included in this
18paragraph).
19    Beginning on July 1, 2022 and until July 1, 2023, the tax
20shall be imposed at the rate of 0% on food prepared for
21immediate consumption and transferred incident to a sale of
22service subject to this Act or the Service Use Tax Act by an
23entity licensed under the Hospital Licensing Act, the Nursing
24Home Care Act, the Assisted Living and Shared Housing Act, the
25ID/DD Community Care Act, the MC/DD Act, the Specialized
26Mental Health Rehabilitation Act of 2013, or the Child Care

 

 

HB3475- 19 -LRB103 26897 HLH 53261 b

1Act of 1969, or an entity that holds a permit issued pursuant
2to the Life Care Facilities Act. Beginning July 1, 2022 and
3until July 1, 2023, the tax shall also be imposed at the rate
4of 0% on food for human consumption that is to be consumed off
5the premises where it is sold (other than alcoholic beverages,
6food consisting of or infused with adult use cannabis, soft
7drinks, and food that has been prepared for immediate
8consumption and is not otherwise included in this paragraph).
9    The tax shall also be imposed at the rate of 1% on
10prescription and nonprescription medicines, drugs, medical
11appliances, products classified as Class III medical devices
12by the United States Food and Drug Administration that are
13used for cancer treatment pursuant to a prescription, as well
14as any accessories and components related to those devices,
15modifications to a motor vehicle for the purpose of rendering
16it usable by a person with a disability, diapers, baby wipes,
17and insulin, blood sugar testing materials, syringes, and
18needles used by human diabetics. For the purposes of this
19Section, until September 1, 2009: the term "soft drinks" means
20any complete, finished, ready-to-use, non-alcoholic drink,
21whether carbonated or not, including, but not limited to, soda
22water, cola, fruit juice, vegetable juice, carbonated water,
23and all other preparations commonly known as soft drinks of
24whatever kind or description that are contained in any closed
25or sealed can, carton, or container, regardless of size; but
26"soft drinks" does not include coffee, tea, non-carbonated

 

 

HB3475- 20 -LRB103 26897 HLH 53261 b

1water, infant formula, milk or milk products as defined in the
2Grade A Pasteurized Milk and Milk Products Act, or drinks
3containing 50% or more natural fruit or vegetable juice.
4    Notwithstanding any other provisions of this Act,
5beginning September 1, 2009, "soft drinks" means non-alcoholic
6beverages that contain natural or artificial sweeteners. "Soft
7drinks" does do not include beverages that contain milk or
8milk products, soy, rice or similar milk substitutes, or
9greater than 50% of vegetable or fruit juice by volume.
10    Until August 1, 2009, and notwithstanding any other
11provisions of this Act, "food for human consumption that is to
12be consumed off the premises where it is sold" includes all
13food sold through a vending machine, except soft drinks and
14food products that are dispensed hot from a vending machine,
15regardless of the location of the vending machine. Beginning
16August 1, 2009, and notwithstanding any other provisions of
17this Act, "food for human consumption that is to be consumed
18off the premises where it is sold" includes all food sold
19through a vending machine, except soft drinks, candy, and food
20products that are dispensed hot from a vending machine,
21regardless of the location of the vending machine.
22    Notwithstanding any other provisions of this Act,
23beginning September 1, 2009, "food for human consumption that
24is to be consumed off the premises where it is sold" does not
25include candy. For purposes of this Section, "candy" means a
26preparation of sugar, honey, or other natural or artificial

 

 

HB3475- 21 -LRB103 26897 HLH 53261 b

1sweeteners in combination with chocolate, fruits, nuts or
2other ingredients or flavorings in the form of bars, drops, or
3pieces. "Candy" does not include any preparation that contains
4flour or requires refrigeration.
5    Notwithstanding any other provisions of this Act,
6beginning September 1, 2009, "nonprescription medicines and
7drugs" does not include grooming and hygiene products. For
8purposes of this Section, "grooming and hygiene products"
9includes, but is not limited to, soaps and cleaning solutions,
10shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
11lotions and screens, unless those products are available by
12prescription only, regardless of whether the products meet the
13definition of "over-the-counter-drugs". For the purposes of
14this paragraph, "over-the-counter-drug" means a drug for human
15use that contains a label that identifies the product as a drug
16as required by 21 CFR C.F.R. § 201.66. The
17"over-the-counter-drug" label includes:
18        (A) a A "Drug Facts" panel; or
19        (B) a A statement of the "active ingredient(s)" with a
20    list of those ingredients contained in the compound,
21    substance or preparation.
22    Beginning on January 1, 2014 (the effective date of Public
23Act 98-122), "prescription and nonprescription medicines and
24drugs" includes medical cannabis purchased from a registered
25dispensing organization under the Compassionate Use of Medical
26Cannabis Program Act.

 

 

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1    As used in this Section, "adult use cannabis" means
2cannabis subject to tax under the Cannabis Cultivation
3Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
4and does not include cannabis subject to tax under the
5Compassionate Use of Medical Cannabis Program Act.
6(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
7102-4, eff. 4-27-21; 102-16, eff. 6-17-21; 102-700, Article
820, Section 20-15, eff. 4-19-22; 102-700, Article 60, Section
960-25, eff. 4-19-22; revised 6-1-22.)
 
10    Section 20. The Retailers' Occupation Tax Act is amended
11by changing Sections 2-10 and 3 as follows:
 
12    (35 ILCS 120/2-10)
13    Sec. 2-10. Rate of tax. Unless otherwise provided in this
14Section, the tax imposed by this Act is at the rate of 6.25% of
15gross receipts from sales of tangible personal property made
16in the course of business.
17    Beginning on July 1, 2000 and through December 31, 2000,
18with respect to motor fuel, as defined in Section 1.1 of the
19Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
20the Use Tax Act, the tax is imposed at the rate of 1.25%.
21    Beginning on August 6, 2010 through August 15, 2010, and
22beginning again on August 5, 2022 through August 14, 2022,
23with respect to sales tax holiday items as defined in Section
242-8 of this Act, the tax is imposed at the rate of 1.25%.

 

 

HB3475- 23 -LRB103 26897 HLH 53261 b

1    Within 14 days after July 1, 2000 (the effective date of
2Public Act 91-872) this amendatory Act of the 91st General
3Assembly, each retailer of motor fuel and gasohol shall cause
4the following notice to be posted in a prominently visible
5place on each retail dispensing device that is used to
6dispense motor fuel or gasohol in the State of Illinois: "As of
7July 1, 2000, the State of Illinois has eliminated the State's
8share of sales tax on motor fuel and gasohol through December
931, 2000. The price on this pump should reflect the
10elimination of the tax." The notice shall be printed in bold
11print on a sign that is no smaller than 4 inches by 8 inches.
12The sign shall be clearly visible to customers. Any retailer
13who fails to post or maintain a required sign through December
1431, 2000 is guilty of a petty offense for which the fine shall
15be $500 per day per each retail premises where a violation
16occurs.
17    With respect to gasohol, as defined in the Use Tax Act, the
18tax imposed by this Act applies to (i) 70% of the proceeds of
19sales made on or after January 1, 1990, and before July 1,
202003, (ii) 80% of the proceeds of sales made on or after July
211, 2003 and on or before July 1, 2017, and (iii) 100% of the
22proceeds of sales made thereafter. If, at any time, however,
23the tax under this Act on sales of gasohol, as defined in the
24Use Tax Act, is imposed at the rate of 1.25%, then the tax
25imposed by this Act applies to 100% of the proceeds of sales of
26gasohol made during that time.

 

 

HB3475- 24 -LRB103 26897 HLH 53261 b

1    With respect to majority blended ethanol fuel, as defined
2in the Use Tax Act, the tax imposed by this Act does not apply
3to the proceeds of sales made on or after July 1, 2003 and on
4or before December 31, 2023 but applies to 100% of the proceeds
5of sales made thereafter.
6    With respect to biodiesel blends, as defined in the Use
7Tax Act, with no less than 1% and no more than 10% biodiesel,
8the tax imposed by this Act applies to (i) 80% of the proceeds
9of sales made on or after July 1, 2003 and on or before
10December 31, 2018 and (ii) 100% of the proceeds of sales made
11after December 31, 2018 and before January 1, 2024. On and
12after January 1, 2024 and on or before December 31, 2030, the
13taxation of biodiesel, renewable diesel, and biodiesel blends
14shall be as provided in Section 3-5.1 of the Use Tax Act. If,
15at any time, however, the tax under this Act on sales of
16biodiesel blends, as defined in the Use Tax Act, with no less
17than 1% and no more than 10% biodiesel is imposed at the rate
18of 1.25%, then the tax imposed by this Act applies to 100% of
19the proceeds of sales of biodiesel blends with no less than 1%
20and no more than 10% biodiesel made during that time.
21    With respect to biodiesel, as defined in the Use Tax Act,
22and biodiesel blends, as defined in the Use Tax Act, with more
23than 10% but no more than 99% biodiesel, the tax imposed by
24this Act does not apply to the proceeds of sales made on or
25after July 1, 2003 and on or before December 31, 2023. On and
26after January 1, 2024 and on or before December 31, 2030, the

 

 

HB3475- 25 -LRB103 26897 HLH 53261 b

1taxation of biodiesel, renewable diesel, and biodiesel blends
2shall be as provided in Section 3-5.1 of the Use Tax Act.
3    Until July 1, 2022 and beginning again on July 1, 2023,
4with respect to food for human consumption that is to be
5consumed off the premises where it is sold (other than
6alcoholic beverages, food consisting of or infused with adult
7use cannabis, soft drinks, and food that has been prepared for
8immediate consumption), the tax is imposed at the rate of 1%.
9Beginning July 1, 2022 and until July 1, 2023, with respect to
10food for human consumption that is to be consumed off the
11premises where it is sold (other than alcoholic beverages,
12food consisting of or infused with adult use cannabis, soft
13drinks, and food that has been prepared for immediate
14consumption), the tax is imposed at the rate of 0%.
15    With respect to prescription and nonprescription
16medicines, drugs, medical appliances, products classified as
17Class III medical devices by the United States Food and Drug
18Administration that are used for cancer treatment pursuant to
19a prescription, as well as any accessories and components
20related to those devices, modifications to a motor vehicle for
21the purpose of rendering it usable by a person with a
22disability, diapers, baby wipes, and insulin, blood sugar
23testing materials, syringes, and needles used by human
24diabetics, the tax is imposed at the rate of 1%. For the
25purposes of this Section, until September 1, 2009: the term
26"soft drinks" means any complete, finished, ready-to-use,

 

 

HB3475- 26 -LRB103 26897 HLH 53261 b

1non-alcoholic drink, whether carbonated or not, including, but
2not limited to, soda water, cola, fruit juice, vegetable
3juice, carbonated water, and all other preparations commonly
4known as soft drinks of whatever kind or description that are
5contained in any closed or sealed bottle, can, carton, or
6container, regardless of size; but "soft drinks" does not
7include coffee, tea, non-carbonated water, infant formula,
8milk or milk products as defined in the Grade A Pasteurized
9Milk and Milk Products Act, or drinks containing 50% or more
10natural fruit or vegetable juice.
11    Notwithstanding any other provisions of this Act,
12beginning September 1, 2009, "soft drinks" means non-alcoholic
13beverages that contain natural or artificial sweeteners. "Soft
14drinks" does do not include beverages that contain milk or
15milk products, soy, rice or similar milk substitutes, or
16greater than 50% of vegetable or fruit juice by volume.
17    Until August 1, 2009, and notwithstanding any other
18provisions of this Act, "food for human consumption that is to
19be consumed off the premises where it is sold" includes all
20food sold through a vending machine, except soft drinks and
21food products that are dispensed hot from a vending machine,
22regardless of the location of the vending machine. Beginning
23August 1, 2009, and notwithstanding any other provisions of
24this Act, "food for human consumption that is to be consumed
25off the premises where it is sold" includes all food sold
26through a vending machine, except soft drinks, candy, and food

 

 

HB3475- 27 -LRB103 26897 HLH 53261 b

1products that are dispensed hot from a vending machine,
2regardless of the location of the vending machine.
3    Notwithstanding any other provisions of this Act,
4beginning September 1, 2009, "food for human consumption that
5is to be consumed off the premises where it is sold" does not
6include candy. For purposes of this Section, "candy" means a
7preparation of sugar, honey, or other natural or artificial
8sweeteners in combination with chocolate, fruits, nuts or
9other ingredients or flavorings in the form of bars, drops, or
10pieces. "Candy" does not include any preparation that contains
11flour or requires refrigeration.
12    Notwithstanding any other provisions of this Act,
13beginning September 1, 2009, "nonprescription medicines and
14drugs" does not include grooming and hygiene products. For
15purposes of this Section, "grooming and hygiene products"
16includes, but is not limited to, soaps and cleaning solutions,
17shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
18lotions and screens, unless those products are available by
19prescription only, regardless of whether the products meet the
20definition of "over-the-counter-drugs". For the purposes of
21this paragraph, "over-the-counter-drug" means a drug for human
22use that contains a label that identifies the product as a drug
23as required by 21 CFR C.F.R. § 201.66. The
24"over-the-counter-drug" label includes:
25        (A) a A "Drug Facts" panel; or
26        (B) a A statement of the "active ingredient(s)" with a

 

 

HB3475- 28 -LRB103 26897 HLH 53261 b

1    list of those ingredients contained in the compound,
2    substance or preparation.
3    Beginning on January 1, 2014 (the effective date of Public
4Act 98-122) this amendatory Act of the 98th General Assembly,
5"prescription and nonprescription medicines and drugs"
6includes medical cannabis purchased from a registered
7dispensing organization under the Compassionate Use of Medical
8Cannabis Program Act.
9    As used in this Section, "adult use cannabis" means
10cannabis subject to tax under the Cannabis Cultivation
11Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
12and does not include cannabis subject to tax under the
13Compassionate Use of Medical Cannabis Program Act.
14(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
15102-4, eff. 4-27-21; 102-700, Article 20, Section 20-20, eff.
164-19-22; 102-700, Article 60, Section 60-30, eff. 4-19-22;
17102-700, Article 65, Section 65-10, eff. 4-19-22; revised
186-1-22.)