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1 | AN ACT concerning vehicles.
| ||||||||||||||||||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois, | ||||||||||||||||||||||||||||||||||
3 | represented in the General Assembly:
| ||||||||||||||||||||||||||||||||||
4 | Section 5. The Illinois Income Tax Act is amended by | ||||||||||||||||||||||||||||||||||
5 | changing
Section 215 as follows:
| ||||||||||||||||||||||||||||||||||
6 | (35 ILCS 5/215)
| ||||||||||||||||||||||||||||||||||
7 | Sec. 215. Transportation Employee Credit.
| ||||||||||||||||||||||||||||||||||
8 | (a) For each taxable year beginning on or after January 1, | ||||||||||||||||||||||||||||||||||
9 | 2004 and on or
before December 31, 2004 , a qualified
employer | ||||||||||||||||||||||||||||||||||
10 | shall be allowed a credit against the tax imposed by | ||||||||||||||||||||||||||||||||||
11 | subsections (a)
and (b) of Section 201 of this Act in the | ||||||||||||||||||||||||||||||||||
12 | amount of $50 for each eligible
employee
employed by the | ||||||||||||||||||||||||||||||||||
13 | taxpayer as of the last day of the taxable year.
| ||||||||||||||||||||||||||||||||||
14 | (b) For purposes of this Section, "qualified employer" | ||||||||||||||||||||||||||||||||||
15 | means:
| ||||||||||||||||||||||||||||||||||
16 | (1) any employer who pays a commercial distribution fee | ||||||||||||||||||||||||||||||||||
17 | under Section
3-815.1 of the Illinois Vehicle Code during | ||||||||||||||||||||||||||||||||||
18 | the taxable year; or
| ||||||||||||||||||||||||||||||||||
19 | (2) any employer who, as of the end of the taxable | ||||||||||||||||||||||||||||||||||
20 | year, has one or more
employees whose compensation is | ||||||||||||||||||||||||||||||||||
21 | subject to tax only by the employee's state of
residence | ||||||||||||||||||||||||||||||||||
22 | pursuant to 49 U.S.C 14503(a)(1).
| ||||||||||||||||||||||||||||||||||
23 | (c) For purposes of this Section, "employee" includes an | ||||||||||||||||||||||||||||||||||
24 | individual who is
treated as an employee of the taxpayer under | ||||||||||||||||||||||||||||||||||
25 | Section 401(c) of the Internal
Revenue Code and whose actual | ||||||||||||||||||||||||||||||||||
26 | assigned duties are such that, if the individual
were a | ||||||||||||||||||||||||||||||||||
27 | common-law employee performing such duties in 2 or more states, | ||||||||||||||||||||||||||||||||||
28 | the
individual's compensation would be subject to tax only by | ||||||||||||||||||||||||||||||||||
29 | the individual's
state of residence pursuant to 49 U.S.C. | ||||||||||||||||||||||||||||||||||
30 | 14503(a)(1).
| ||||||||||||||||||||||||||||||||||
31 | (d) An employee is an "eligible employee" only if all of | ||||||||||||||||||||||||||||||||||
32 | the following
criteria are met:
|
| |||||||
| |||||||
1 | (1) The employee is an operator of a motor vehicle;
| ||||||
2 | (2) The employee's compensation, pursuant to 49 U.S.C. | ||||||
3 | 14503(a)(1), is
subject to tax only by the employee's state | ||||||
4 | of residence, or would be subject
to tax only by the | ||||||
5 | employee's state of residence if the employee's
actual | ||||||
6 | duties were performed in 2 or more states;
| ||||||
7 | (3) As of the end of the taxable year for which the | ||||||
8 | credit is claimed, the
employee is a resident of this State | ||||||
9 | for purposes of this Act and 49 U.S.C.
14503(a)(1); and
| ||||||
10 | (4) The employee is a full-time employee working 30 or | ||||||
11 | more hours per week
for 180 consecutive days; provided that | ||||||
12 | such 180-day period may be completed
after the end of the | ||||||
13 | taxable year for which the credit under this Section is
| ||||||
14 | claimed.
| ||||||
15 | (e) For partners, shareholders of subchapter S | ||||||
16 | corporations, and owners of
limited liability companies, if the | ||||||
17 | limited liability company is treated as a
partnership for | ||||||
18 | purposes of federal and State income taxation, there shall be
| ||||||
19 | allowed a credit under this Section to be determined in | ||||||
20 | accordance with the
determination of income and distributive | ||||||
21 | share of income under Sections 702 and
704 and subchapter S of | ||||||
22 | the Internal Revenue Code.
| ||||||
23 | (f) Any credit allowed under this Section which is unused | ||||||
24 | in the year the
credit is earned may be carried forward to each | ||||||
25 | of the 5 taxable years
following the year for which the credit | ||||||
26 | is first computed until it is used.
This credit shall be | ||||||
27 | applied first to the earliest year for which there is a
| ||||||
28 | liability. If there is a credit under this Section from more | ||||||
29 | than one tax year
that is available to offset a liability, the | ||||||
30 | earliest credit arising under this
Section shall be applied | ||||||
31 | first.
| ||||||
32 | (g) (Blank)
This Section is exempt from the provisions of | ||||||
33 | Section 250
of this Act .
| ||||||
34 | (h) The Department of Revenue shall promulgate such rules | ||||||
35 | and regulations as
may be deemed necessary to carry out the | ||||||
36 | purposes of this Section.
|
| |||||||
| |||||||
1 | (Source: P.A. 93-23, eff. 6-20-03.)
| ||||||
2 | Section 10. The Use Tax Act is amended by changing Section | ||||||
3 | 3-5 as
follows:
| ||||||
4 | (35 ILCS 105/3-5)
(from Ch. 120, par. 439.3-5)
| ||||||
5 | Sec. 3-5. Exemptions. Use of the following tangible | ||||||
6 | personal property
is exempt from the tax imposed by this Act:
| ||||||
7 | (1) Personal property purchased from a corporation, | ||||||
8 | society, association,
foundation, institution, or | ||||||
9 | organization, other than a limited liability
company, that is | ||||||
10 | organized and operated as a not-for-profit service enterprise
| ||||||
11 | for the benefit of persons 65 years of age or older if the | ||||||
12 | personal property
was not purchased by the enterprise for the | ||||||
13 | purpose of resale by the
enterprise.
| ||||||
14 | (2) Personal property purchased by a not-for-profit | ||||||
15 | Illinois county
fair association for use in conducting, | ||||||
16 | operating, or promoting the
county fair.
| ||||||
17 | (3) Personal property purchased by a not-for-profit
arts or | ||||||
18 | cultural organization that establishes, by proof required by | ||||||
19 | the
Department by
rule, that it has received an exemption under | ||||||
20 | Section 501(c)(3) of the Internal
Revenue Code and that is | ||||||
21 | organized and operated primarily for the
presentation
or | ||||||
22 | support of arts or cultural programming, activities, or | ||||||
23 | services. These
organizations include, but are not limited to, | ||||||
24 | music and dramatic arts
organizations such as symphony | ||||||
25 | orchestras and theatrical groups, arts and
cultural service | ||||||
26 | organizations, local arts councils, visual arts organizations,
| ||||||
27 | and media arts organizations.
On and after the effective date | ||||||
28 | of this amendatory Act of the 92nd General
Assembly, however, | ||||||
29 | an entity otherwise eligible for this exemption shall not
make | ||||||
30 | tax-free purchases unless it has an active identification | ||||||
31 | number issued by
the Department.
| ||||||
32 | (4) Personal property purchased by a governmental body, by | ||||||
33 | a
corporation, society, association, foundation, or | ||||||
34 | institution organized and
operated exclusively for charitable, |
| |||||||
| |||||||
1 | religious, or educational purposes, or
by a not-for-profit | ||||||
2 | corporation, society, association, foundation,
institution, or | ||||||
3 | organization that has no compensated officers or employees
and | ||||||
4 | that is organized and operated primarily for the recreation of | ||||||
5 | persons
55 years of age or older. A limited liability company | ||||||
6 | may qualify for the
exemption under this paragraph only if the | ||||||
7 | limited liability company is
organized and operated | ||||||
8 | exclusively for educational purposes. On and after July
1, | ||||||
9 | 1987, however, no entity otherwise eligible for this exemption | ||||||
10 | shall make
tax-free purchases unless it has an active exemption | ||||||
11 | identification number
issued by the Department.
| ||||||
12 | (5) Until July 1, 2003, a passenger car that is a | ||||||
13 | replacement vehicle to
the extent that the
purchase price of | ||||||
14 | the car is subject to the Replacement Vehicle Tax.
| ||||||
15 | (6) Until July 1, 2003, graphic arts machinery and | ||||||
16 | equipment, including
repair and replacement
parts, both new and | ||||||
17 | used, and including that manufactured on special order,
| ||||||
18 | certified by the purchaser to be used primarily for graphic | ||||||
19 | arts production,
and including machinery and equipment | ||||||
20 | purchased for lease.
Equipment includes chemicals or chemicals | ||||||
21 | acting as catalysts but only if
the
chemicals or chemicals | ||||||
22 | acting as catalysts effect a direct and immediate change
upon a | ||||||
23 | graphic arts product.
| ||||||
24 | (7) Farm chemicals.
| ||||||
25 | (8) Legal tender, currency, medallions, or gold or silver | ||||||
26 | coinage issued by
the State of Illinois, the government of the | ||||||
27 | United States of America, or the
government of any foreign | ||||||
28 | country, and bullion.
| ||||||
29 | (9) Personal property purchased from a teacher-sponsored | ||||||
30 | student
organization affiliated with an elementary or | ||||||
31 | secondary school located in
Illinois.
| ||||||
32 | (10) A motor vehicle of the first division, a motor vehicle | ||||||
33 | of the
second division that is a self-contained motor vehicle | ||||||
34 | designed or
permanently converted to provide living quarters | ||||||
35 | for recreational, camping,
or travel use, with direct walk | ||||||
36 | through to the living quarters from the
driver's seat, or a |
| |||||||
| |||||||
1 | motor vehicle of the second division that is of the
van | ||||||
2 | configuration designed for the transportation of not less than | ||||||
3 | 7 nor
more than 16 passengers, as defined in Section 1-146 of | ||||||
4 | the Illinois
Vehicle Code, that is used for automobile renting, | ||||||
5 | as defined in the
Automobile Renting Occupation and Use Tax | ||||||
6 | Act.
| ||||||
7 | (11) Farm machinery and equipment, both new and used,
| ||||||
8 | including that manufactured on special order, certified by the | ||||||
9 | purchaser
to be used primarily for production agriculture or | ||||||
10 | State or federal
agricultural programs, including individual | ||||||
11 | replacement parts for
the machinery and equipment, including | ||||||
12 | machinery and equipment
purchased
for lease,
and including | ||||||
13 | implements of husbandry defined in Section 1-130 of
the | ||||||
14 | Illinois Vehicle Code, farm machinery and agricultural | ||||||
15 | chemical and
fertilizer spreaders, and nurse wagons required to | ||||||
16 | be registered
under Section 3-809 of the Illinois Vehicle Code,
| ||||||
17 | but excluding other motor
vehicles required to be
registered | ||||||
18 | under the Illinois Vehicle Code.
Horticultural polyhouses or | ||||||
19 | hoop houses used for propagating, growing, or
overwintering | ||||||
20 | plants shall be considered farm machinery and equipment under
| ||||||
21 | this item (11).
Agricultural chemical tender tanks and dry | ||||||
22 | boxes shall include units sold
separately from a motor vehicle | ||||||
23 | required to be licensed and units sold mounted
on a motor | ||||||
24 | vehicle required to be licensed if the selling price of the | ||||||
25 | tender
is separately stated.
| ||||||
26 | Farm machinery and equipment shall include precision | ||||||
27 | farming equipment
that is
installed or purchased to be | ||||||
28 | installed on farm machinery and equipment
including, but not | ||||||
29 | limited to, tractors, harvesters, sprayers, planters,
seeders, | ||||||
30 | or spreaders.
Precision farming equipment includes, but is not | ||||||
31 | limited to, soil testing
sensors, computers, monitors, | ||||||
32 | software, global positioning
and mapping systems, and other | ||||||
33 | such equipment.
| ||||||
34 | Farm machinery and equipment also includes computers, | ||||||
35 | sensors, software, and
related equipment used primarily in the
| ||||||
36 | computer-assisted operation of production agriculture |
| |||||||
| |||||||
1 | facilities, equipment,
and
activities such as, but not limited | ||||||
2 | to,
the collection, monitoring, and correlation of
animal and | ||||||
3 | crop data for the purpose of
formulating animal diets and | ||||||
4 | agricultural chemicals. This item (11) is exempt
from the | ||||||
5 | provisions of
Section 3-90.
| ||||||
6 | (12) Fuel and petroleum products sold to or used by an air | ||||||
7 | common
carrier, certified by the carrier to be used for | ||||||
8 | consumption, shipment, or
storage in the conduct of its | ||||||
9 | business as an air common carrier, for a
flight destined for or | ||||||
10 | returning from a location or locations
outside the United | ||||||
11 | States without regard to previous or subsequent domestic
| ||||||
12 | stopovers.
| ||||||
13 | (13) Proceeds of mandatory service charges separately
| ||||||
14 | stated on customers' bills for the purchase and consumption of | ||||||
15 | food and
beverages purchased at retail from a retailer, to the | ||||||
16 | extent that the proceeds
of the service charge are in fact | ||||||
17 | turned over as tips or as a substitute
for tips to the | ||||||
18 | employees who participate directly in preparing, serving,
| ||||||
19 | hosting or cleaning up the food or beverage function with | ||||||
20 | respect to which
the service charge is imposed.
| ||||||
21 | (14) Until July 1, 2003, oil field exploration, drilling, | ||||||
22 | and production
equipment,
including (i) rigs and parts of rigs, | ||||||
23 | rotary
rigs, cable tool rigs, and workover rigs, (ii) pipe and | ||||||
24 | tubular goods,
including casing and drill strings, (iii) pumps | ||||||
25 | and pump-jack units, (iv)
storage tanks and flow lines, (v) any | ||||||
26 | individual replacement part for oil
field exploration, | ||||||
27 | drilling, and production equipment, and (vi) machinery and
| ||||||
28 | equipment purchased
for lease; but excluding motor vehicles | ||||||
29 | required to be registered under the
Illinois Vehicle Code.
| ||||||
30 | (15) Photoprocessing machinery and equipment, including | ||||||
31 | repair and
replacement parts, both new and used, including that
| ||||||
32 | manufactured on special order, certified by the purchaser to be | ||||||
33 | used
primarily for photoprocessing, and including
| ||||||
34 | photoprocessing machinery and equipment purchased for lease.
| ||||||
35 | (16) Until July 1, 2003, coal exploration, mining, | ||||||
36 | offhighway hauling,
processing, maintenance, and reclamation |
| |||||||
| |||||||
1 | equipment,
including replacement parts and equipment, and
| ||||||
2 | including equipment purchased for lease, but excluding motor
| ||||||
3 | vehicles required to be registered under the Illinois Vehicle | ||||||
4 | Code.
| ||||||
5 | (17) Until July 1, 2003, distillation machinery and | ||||||
6 | equipment, sold as a
unit or kit,
assembled or installed by the | ||||||
7 | retailer, certified by the user to be used
only for the | ||||||
8 | production of ethyl alcohol that will be used for consumption
| ||||||
9 | as motor fuel or as a component of motor fuel for the personal | ||||||
10 | use of the
user, and not subject to sale or resale.
| ||||||
11 | (18) Manufacturing and assembling machinery and equipment | ||||||
12 | used
primarily in the process of manufacturing or assembling | ||||||
13 | tangible
personal property for wholesale or retail sale or | ||||||
14 | lease, whether that sale
or lease is made directly by the | ||||||
15 | manufacturer or by some other person,
whether the materials | ||||||
16 | used in the process are
owned by the manufacturer or some other | ||||||
17 | person, or whether that sale or
lease is made apart from or as | ||||||
18 | an incident to the seller's engaging in
the service occupation | ||||||
19 | of producing machines, tools, dies, jigs,
patterns, gauges, or | ||||||
20 | other similar items of no commercial value on
special order for | ||||||
21 | a particular purchaser.
| ||||||
22 | (19) Personal property delivered to a purchaser or | ||||||
23 | purchaser's donee
inside Illinois when the purchase order for | ||||||
24 | that personal property was
received by a florist located | ||||||
25 | outside Illinois who has a florist located
inside Illinois | ||||||
26 | deliver the personal property.
| ||||||
27 | (20) Semen used for artificial insemination of livestock | ||||||
28 | for direct
agricultural production.
| ||||||
29 | (21) Horses, or interests in horses, registered with and | ||||||
30 | meeting the
requirements of any of the
Arabian Horse Club | ||||||
31 | Registry of America, Appaloosa Horse Club, American Quarter
| ||||||
32 | Horse Association, United States
Trotting Association, or | ||||||
33 | Jockey Club, as appropriate, used for
purposes of breeding or | ||||||
34 | racing for prizes.
| ||||||
35 | (22) Computers and communications equipment utilized for | ||||||
36 | any
hospital
purpose
and equipment used in the diagnosis,
|
| |||||||
| |||||||
1 | analysis, or treatment of hospital patients purchased by a | ||||||
2 | lessor who leases
the
equipment, under a lease of one year or | ||||||
3 | longer executed or in effect at the
time the lessor would | ||||||
4 | otherwise be subject to the tax imposed by this Act, to a
| ||||||
5 | hospital
that has been issued an active tax exemption | ||||||
6 | identification number by
the
Department under Section 1g of the | ||||||
7 | Retailers' Occupation Tax Act. If the
equipment is leased in a | ||||||
8 | manner that does not qualify for
this exemption or is used in | ||||||
9 | any other non-exempt manner, the lessor
shall be liable for the
| ||||||
10 | tax imposed under this Act or the Service Use Tax Act, as the | ||||||
11 | case may
be, based on the fair market value of the property at | ||||||
12 | the time the
non-qualifying use occurs. No lessor shall collect | ||||||
13 | or attempt to collect an
amount (however
designated) that | ||||||
14 | purports to reimburse that lessor for the tax imposed by this
| ||||||
15 | Act or the Service Use Tax Act, as the case may be, if the tax | ||||||
16 | has not been
paid by the lessor. If a lessor improperly | ||||||
17 | collects any such amount from the
lessee, the lessee shall have | ||||||
18 | a legal right to claim a refund of that amount
from the lessor. | ||||||
19 | If, however, that amount is not refunded to the lessee for
any | ||||||
20 | reason, the lessor is liable to pay that amount to the | ||||||
21 | Department.
| ||||||
22 | (23) Personal property purchased by a lessor who leases the
| ||||||
23 | property, under
a
lease of
one year or longer executed or in | ||||||
24 | effect at the time
the lessor would otherwise be subject to the | ||||||
25 | tax imposed by this Act,
to a governmental body
that has been | ||||||
26 | issued an active sales tax exemption identification number by | ||||||
27 | the
Department under Section 1g of the Retailers' Occupation | ||||||
28 | Tax Act.
If the
property is leased in a manner that does not | ||||||
29 | qualify for
this exemption
or used in any other non-exempt | ||||||
30 | manner, the lessor shall be liable for the
tax imposed under | ||||||
31 | this Act or the Service Use Tax Act, as the case may
be, based | ||||||
32 | on the fair market value of the property at the time the
| ||||||
33 | non-qualifying use occurs. No lessor shall collect or attempt | ||||||
34 | to collect an
amount (however
designated) that purports to | ||||||
35 | reimburse that lessor for the tax imposed by this
Act or the | ||||||
36 | Service Use Tax Act, as the case may be, if the tax has not been
|
| |||||||
| |||||||
1 | paid by the lessor. If a lessor improperly collects any such | ||||||
2 | amount from the
lessee, the lessee shall have a legal right to | ||||||
3 | claim a refund of that amount
from the lessor. If, however, | ||||||
4 | that amount is not refunded to the lessee for
any reason, the | ||||||
5 | lessor is liable to pay that amount to the Department.
| ||||||
6 | (24) Beginning with taxable years ending on or after | ||||||
7 | December
31, 1995
and
ending with taxable years ending on or | ||||||
8 | before December 31, 2004,
personal property that is
donated for | ||||||
9 | disaster relief to be used in a State or federally declared
| ||||||
10 | disaster area in Illinois or bordering Illinois by a | ||||||
11 | manufacturer or retailer
that is registered in this State to a | ||||||
12 | corporation, society, association,
foundation, or institution | ||||||
13 | that has been issued a sales tax exemption
identification | ||||||
14 | number by the Department that assists victims of the disaster
| ||||||
15 | who reside within the declared disaster area.
| ||||||
16 | (25) Beginning with taxable years ending on or after | ||||||
17 | December
31, 1995 and
ending with taxable years ending on or | ||||||
18 | before December 31, 2004, personal
property that is used in the | ||||||
19 | performance of infrastructure repairs in this
State, including | ||||||
20 | but not limited to municipal roads and streets, access roads,
| ||||||
21 | bridges, sidewalks, waste disposal systems, water and sewer | ||||||
22 | line extensions,
water distribution and purification | ||||||
23 | facilities, storm water drainage and
retention facilities, and | ||||||
24 | sewage treatment facilities, resulting from a State
or | ||||||
25 | federally declared disaster in Illinois or bordering Illinois | ||||||
26 | when such
repairs are initiated on facilities located in the | ||||||
27 | declared disaster area
within 6 months after the disaster.
| ||||||
28 | (26) Beginning July 1, 1999, game or game birds purchased | ||||||
29 | at a "game
breeding
and hunting preserve area" or an "exotic | ||||||
30 | game hunting area" as those terms are
used in
the Wildlife Code | ||||||
31 | or at a hunting enclosure approved through rules adopted by
the
| ||||||
32 | Department of Natural Resources. This paragraph is exempt from | ||||||
33 | the provisions
of
Section 3-90.
| ||||||
34 | (27) A motor vehicle, as that term is defined in Section | ||||||
35 | 1-146
of the
Illinois
Vehicle Code, that is donated to a | ||||||
36 | corporation, limited liability company,
society, association, |
| |||||||
| |||||||
1 | foundation, or institution that is determined by the
Department | ||||||
2 | to be organized and operated exclusively for educational | ||||||
3 | purposes.
For purposes of this exemption, "a corporation, | ||||||
4 | limited liability company,
society, association, foundation, | ||||||
5 | or institution organized and operated
exclusively for | ||||||
6 | educational purposes" means all tax-supported public schools,
| ||||||
7 | private schools that offer systematic instruction in useful | ||||||
8 | branches of
learning by methods common to public schools and | ||||||
9 | that compare favorably in
their scope and intensity with the | ||||||
10 | course of study presented in tax-supported
schools, and | ||||||
11 | vocational or technical schools or institutes organized and
| ||||||
12 | operated exclusively to provide a course of study of not less | ||||||
13 | than 6 weeks
duration and designed to prepare individuals to | ||||||
14 | follow a trade or to pursue a
manual, technical, mechanical, | ||||||
15 | industrial, business, or commercial
occupation.
| ||||||
16 | (28) Beginning January 1, 2000, personal property, | ||||||
17 | including
food,
purchased through fundraising
events for the | ||||||
18 | benefit of
a public or private elementary or
secondary school, | ||||||
19 | a group of those schools, or one or more school
districts if | ||||||
20 | the events are
sponsored by an entity recognized by the school | ||||||
21 | district that consists
primarily of volunteers and includes
| ||||||
22 | parents and teachers of the school children. This paragraph | ||||||
23 | does not apply
to fundraising
events (i) for the benefit of | ||||||
24 | private home instruction or (ii)
for which the fundraising | ||||||
25 | entity purchases the personal property sold at
the events from | ||||||
26 | another individual or entity that sold the property for the
| ||||||
27 | purpose of resale by the fundraising entity and that
profits | ||||||
28 | from the sale to the
fundraising entity. This paragraph is | ||||||
29 | exempt
from the provisions
of Section 3-90.
| ||||||
30 | (29) Beginning January 1, 2000 and through December 31, | ||||||
31 | 2001, new or
used automatic vending
machines that prepare and | ||||||
32 | serve hot food and beverages, including coffee, soup,
and
other | ||||||
33 | items, and replacement parts for these machines.
Beginning | ||||||
34 | January 1,
2002 and through June 30, 2003, machines and parts | ||||||
35 | for machines used in
commercial, coin-operated amusement and | ||||||
36 | vending business if a use or occupation
tax is paid on the |
| |||||||
| |||||||
1 | gross receipts derived from the use of the commercial,
| ||||||
2 | coin-operated amusement and vending machines.
This
paragraph
| ||||||
3 | is exempt from the provisions of Section 3-90.
| ||||||
4 | (30) Food for human consumption that is to be consumed off | ||||||
5 | the premises
where it is sold (other than alcoholic beverages, | ||||||
6 | soft drinks, and food that
has been prepared for immediate | ||||||
7 | consumption) and prescription and
nonprescription medicines, | ||||||
8 | drugs, medical appliances, and insulin, urine
testing | ||||||
9 | materials, syringes, and needles used by diabetics, for human | ||||||
10 | use, when
purchased for use by a person receiving medical | ||||||
11 | assistance under Article 5 of
the Illinois Public Aid Code who | ||||||
12 | resides in a licensed long-term care facility,
as defined in | ||||||
13 | the Nursing Home Care Act.
| ||||||
14 | (31) Beginning on
the effective date of this amendatory Act | ||||||
15 | of the 92nd General Assembly,
computers and communications | ||||||
16 | equipment
utilized for any hospital purpose and equipment used | ||||||
17 | in the diagnosis,
analysis, or treatment of hospital patients | ||||||
18 | purchased by a lessor who leases
the equipment, under a lease | ||||||
19 | of one year or longer executed or in effect at the
time the | ||||||
20 | lessor would otherwise be subject to the tax imposed by this | ||||||
21 | Act, to a
hospital that has been issued an active tax exemption | ||||||
22 | identification number by
the Department under Section 1g of the | ||||||
23 | Retailers' Occupation Tax Act. If the
equipment is leased in a | ||||||
24 | manner that does not qualify for this exemption or is
used in | ||||||
25 | any other nonexempt manner, the lessor shall be liable for the | ||||||
26 | tax
imposed under this Act or the Service Use Tax Act, as the | ||||||
27 | case may be, based on
the fair market value of the property at | ||||||
28 | the time the nonqualifying use
occurs. No lessor shall collect | ||||||
29 | or attempt to collect an amount (however
designated) that | ||||||
30 | purports to reimburse that lessor for the tax imposed by this
| ||||||
31 | Act or the Service Use Tax Act, as the case may be, if the tax | ||||||
32 | has not been
paid by the lessor. If a lessor improperly | ||||||
33 | collects any such amount from the
lessee, the lessee shall have | ||||||
34 | a legal right to claim a refund of that amount
from the lessor. | ||||||
35 | If, however, that amount is not refunded to the lessee for
any | ||||||
36 | reason, the lessor is liable to pay that amount to the |
| |||||||
| |||||||
1 | Department.
This paragraph is exempt from the provisions of | ||||||
2 | Section 3-90.
| ||||||
3 | (32) Beginning on
the effective date of this amendatory Act | ||||||
4 | of the 92nd General Assembly,
personal property purchased by a | ||||||
5 | lessor who leases the property,
under a lease of one year or | ||||||
6 | longer executed or in effect at the time the
lessor would | ||||||
7 | otherwise be subject to the tax imposed by this Act, to a
| ||||||
8 | governmental body that has been issued an active sales tax | ||||||
9 | exemption
identification number by the Department under | ||||||
10 | Section 1g of the Retailers'
Occupation Tax Act. If the | ||||||
11 | property is leased in a manner that does not
qualify for this | ||||||
12 | exemption or used in any other nonexempt manner, the lessor
| ||||||
13 | shall be liable for the tax imposed under this Act or the | ||||||
14 | Service Use Tax Act,
as the case may be, based on the fair | ||||||
15 | market value of the property at the time
the nonqualifying use | ||||||
16 | occurs. No lessor shall collect or attempt to collect
an amount | ||||||
17 | (however designated) that purports to reimburse that lessor for | ||||||
18 | the
tax imposed by this Act or the Service Use Tax Act, as the | ||||||
19 | case may be, if the
tax has not been paid by the lessor. If a | ||||||
20 | lessor improperly collects any such
amount from the lessee, the | ||||||
21 | lessee shall have a legal right to claim a refund
of that | ||||||
22 | amount from the lessor. If, however, that amount is not | ||||||
23 | refunded to
the lessee for any reason, the lessor is liable to | ||||||
24 | pay that amount to the
Department. This paragraph is exempt | ||||||
25 | from the provisions of Section 3-90.
| ||||||
26 | (33) On and after July 1, 2003 and through June 30, 2004 , | ||||||
27 | the use in
this State of motor vehicles of
the second division | ||||||
28 | with a gross vehicle weight in excess of 8,000 pounds and
that | ||||||
29 | are subject to the commercial distribution fee imposed under | ||||||
30 | Section
3-815.1 of the Illinois Vehicle Code. This exemption | ||||||
31 | applies to repair and
replacement parts added after the initial | ||||||
32 | purchase of such a motor vehicle if
that motor
vehicle is used | ||||||
33 | in a manner that would qualify for the rolling stock exemption
| ||||||
34 | otherwise provided for in this Act.
| ||||||
35 | (Source: P.A. 92-35, eff.
7-1-01; 92-227, eff. 8-2-01; 92-337, | ||||||
36 | eff. 8-10-01; 92-484, eff. 8-23-01;
92-651, eff. 7-11-02; |
| |||||||
| |||||||
1 | 93-23, eff. 6-20-03; 93-24, eff. 6-20-03; revised
9-11-03.)
| ||||||
2 | Section 15. The Service Use Tax Act is amended by changing | ||||||
3 | Section 2
as follows:
| ||||||
4 | (35 ILCS 110/2)
(from Ch. 120, par. 439.32)
| ||||||
5 | Sec. 2. "Use" means the exercise by any person of any right | ||||||
6 | or power
over tangible personal property incident to the | ||||||
7 | ownership of that
property, but does not include the sale or | ||||||
8 | use for demonstration by him
of that property in any form as | ||||||
9 | tangible personal property in the
regular course of business.
| ||||||
10 | "Use" does not mean the interim
use of
tangible personal | ||||||
11 | property nor the physical incorporation of tangible
personal | ||||||
12 | property, as an ingredient or constituent, into other tangible
| ||||||
13 | personal property, (a) which is sold in the regular course of | ||||||
14 | business
or (b) which the person incorporating such ingredient | ||||||
15 | or constituent
therein has undertaken at the time of such | ||||||
16 | purchase to cause to be
transported in interstate commerce to | ||||||
17 | destinations outside the State of
Illinois.
| ||||||
18 | "Purchased from a serviceman" means the acquisition of the | ||||||
19 | ownership
of, or title to, tangible personal property through a | ||||||
20 | sale of service.
| ||||||
21 | "Purchaser" means any person who, through a sale of | ||||||
22 | service, acquires
the ownership of, or title to, any tangible | ||||||
23 | personal property.
| ||||||
24 | "Cost price" means the consideration paid by the serviceman | ||||||
25 | for a
purchase valued in money, whether paid in money or | ||||||
26 | otherwise, including
cash, credits and services, and shall be | ||||||
27 | determined without any
deduction on account of the supplier's | ||||||
28 | cost of the property sold or on
account of any other expense | ||||||
29 | incurred by the supplier. When a serviceman
contracts out part | ||||||
30 | or all of the services required in his sale of service,
it | ||||||
31 | shall be presumed that the cost price to the serviceman of the | ||||||
32 | property
transferred to him or her by his or her subcontractor | ||||||
33 | is equal to 50% of
the subcontractor's charges to the | ||||||
34 | serviceman in the absence of proof of
the consideration paid by |
| |||||||
| |||||||
1 | the subcontractor for the purchase of such property.
| ||||||
2 | "Selling price" means the consideration for a sale valued | ||||||
3 | in money
whether received in money or otherwise, including | ||||||
4 | cash, credits and
service, and shall be determined without any | ||||||
5 | deduction on account of the
serviceman's cost of the property | ||||||
6 | sold, the cost of materials used,
labor or service cost or any | ||||||
7 | other expense whatsoever, but does not
include interest or | ||||||
8 | finance charges which appear as separate items on
the bill of | ||||||
9 | sale or sales contract nor charges that are added to prices
by | ||||||
10 | sellers on account of the seller's duty to collect, from the
| ||||||
11 | purchaser, the tax that is imposed by this Act.
| ||||||
12 | "Department" means the Department of Revenue.
| ||||||
13 | "Person" means any natural individual, firm, partnership,
| ||||||
14 | association, joint stock company, joint venture, public or | ||||||
15 | private
corporation, limited liability company, and any | ||||||
16 | receiver, executor, trustee,
guardian or other representative | ||||||
17 | appointed by order of any court.
| ||||||
18 | "Sale of service" means any transaction except:
| ||||||
19 | (1) a retail sale of tangible personal property taxable | ||||||
20 | under the
Retailers' Occupation Tax Act or under the Use | ||||||
21 | Tax Act.
| ||||||
22 | (2) a sale of tangible personal property for the | ||||||
23 | purpose of resale
made in compliance with Section 2c of the | ||||||
24 | Retailers' Occupation Tax Act.
| ||||||
25 | (3) except as hereinafter provided, a sale or transfer | ||||||
26 | of tangible
personal property as an incident to the | ||||||
27 | rendering of service for or by
any governmental body, or | ||||||
28 | for or by any corporation, society,
association, | ||||||
29 | foundation or institution organized and operated
| ||||||
30 | exclusively for charitable, religious or educational | ||||||
31 | purposes or any
not-for-profit corporation, society, | ||||||
32 | association, foundation,
institution or organization which | ||||||
33 | has no compensated officers or
employees and which is | ||||||
34 | organized and operated primarily for the
recreation of | ||||||
35 | persons 55 years of age or older. A limited liability | ||||||
36 | company
may qualify for the exemption under this paragraph |
| |||||||
| |||||||
1 | only if the limited
liability company is organized and | ||||||
2 | operated exclusively for educational
purposes.
| ||||||
3 | (4) a sale or transfer of tangible personal
property as | ||||||
4 | an incident to the
rendering of service for interstate | ||||||
5 | carriers for hire for use as rolling stock
moving in | ||||||
6 | interstate commerce or by lessors under a lease of one year | ||||||
7 | or
longer, executed or in effect at the time of purchase of | ||||||
8 | personal property, to
interstate carriers for hire for use | ||||||
9 | as rolling stock moving in interstate
commerce so long as | ||||||
10 | so used by such interstate carriers for hire, and equipment
| ||||||
11 | operated by a telecommunications provider, licensed as a | ||||||
12 | common carrier by the
Federal Communications Commission, | ||||||
13 | which is permanently installed in or affixed
to aircraft | ||||||
14 | moving in interstate commerce.
| ||||||
15 | (4a) a sale or transfer of tangible personal
property | ||||||
16 | as an incident
to the rendering of service for owners, | ||||||
17 | lessors, or shippers of tangible
personal property which is | ||||||
18 | utilized by interstate carriers for hire for
use as rolling | ||||||
19 | stock moving in interstate commerce so long as so used by
| ||||||
20 | interstate carriers for hire, and equipment operated by a
| ||||||
21 | telecommunications provider, licensed as a common carrier | ||||||
22 | by the Federal
Communications Commission, which is | ||||||
23 | permanently installed in or affixed to
aircraft moving in | ||||||
24 | interstate commerce.
| ||||||
25 | (4a-5) on and after July 1, 2003 and through June 30, | ||||||
26 | 2004 , a sale or
transfer of a motor vehicle
of
the
second | ||||||
27 | division with a gross vehicle weight in excess of 8,000 | ||||||
28 | pounds as an
incident to the rendering of service if that | ||||||
29 | motor
vehicle is subject
to the commercial distribution fee | ||||||
30 | imposed under Section 3-815.1 of the
Illinois Vehicle
Code. | ||||||
31 | This exemption applies to repair and replacement parts | ||||||
32 | added after
the
initial
purchase of such a motor vehicle if | ||||||
33 | that motor vehicle is used in a manner that
would
qualify | ||||||
34 | for the rolling stock exemption otherwise provided for in | ||||||
35 | this Act.
| ||||||
36 | (5) a sale or transfer of machinery and equipment used |
| |||||||
| |||||||
1 | primarily in the
process of the manufacturing or | ||||||
2 | assembling, either in an existing, an expanded
or a new | ||||||
3 | manufacturing facility, of tangible personal property for | ||||||
4 | wholesale or
retail sale or lease, whether such sale or | ||||||
5 | lease is made directly by the
manufacturer or by some other | ||||||
6 | person, whether the materials used in the process
are owned | ||||||
7 | by the manufacturer or some other person, or whether such | ||||||
8 | sale or
lease is made apart from or as an incident to the | ||||||
9 | seller's engaging in a
service occupation and the | ||||||
10 | applicable tax is a Service Use Tax or Service
Occupation | ||||||
11 | Tax, rather than Use Tax or Retailers' Occupation Tax.
| ||||||
12 | (5a) the repairing, reconditioning or remodeling, for | ||||||
13 | a
common carrier by rail, of tangible personal property | ||||||
14 | which belongs to such
carrier for hire, and as to which | ||||||
15 | such carrier receives the physical possession
of the | ||||||
16 | repaired, reconditioned or remodeled item of tangible | ||||||
17 | personal property
in Illinois, and which such carrier | ||||||
18 | transports, or shares with another common
carrier in the | ||||||
19 | transportation of such property, out of Illinois on a | ||||||
20 | standard
uniform bill of lading showing the person who | ||||||
21 | repaired, reconditioned or
remodeled the property to a | ||||||
22 | destination outside Illinois, for use outside
Illinois.
| ||||||
23 | (5b) a sale or transfer of tangible personal property | ||||||
24 | which is produced by
the seller thereof on special order in | ||||||
25 | such a way as to have made the
applicable tax the Service | ||||||
26 | Occupation Tax or the Service Use Tax, rather than
the | ||||||
27 | Retailers' Occupation Tax or the Use Tax, for an interstate | ||||||
28 | carrier by rail
which receives the physical possession of | ||||||
29 | such property in Illinois, and which
transports such | ||||||
30 | property, or shares with another common carrier in the
| ||||||
31 | transportation of such property, out of Illinois on a | ||||||
32 | standard uniform bill of
lading showing the seller of the | ||||||
33 | property as the shipper or consignor of such
property to a | ||||||
34 | destination outside Illinois, for use outside Illinois.
| ||||||
35 | (6) until July 1, 2003, a sale or transfer of | ||||||
36 | distillation machinery
and equipment, sold
as a unit or kit |
| |||||||
| |||||||
1 | and assembled or installed by the retailer, which
machinery | ||||||
2 | and equipment is certified by the user to be used only for | ||||||
3 | the
production of ethyl alcohol that will be used for | ||||||
4 | consumption as motor fuel
or as a component of motor fuel | ||||||
5 | for the personal use of such user and not
subject to sale | ||||||
6 | or resale.
| ||||||
7 | (7) at the election of any serviceman not required to | ||||||
8 | be
otherwise registered as a retailer under Section 2a of | ||||||
9 | the Retailers'
Occupation Tax Act, made for each fiscal | ||||||
10 | year sales
of service in which the aggregate annual cost | ||||||
11 | price of tangible
personal property transferred as an | ||||||
12 | incident to the sales of service is
less than 35%, or 75% | ||||||
13 | in the case of servicemen transferring prescription
drugs | ||||||
14 | or servicemen engaged in graphic arts production, of the | ||||||
15 | aggregate
annual total gross receipts from all sales of | ||||||
16 | service. The purchase of
such tangible personal property by | ||||||
17 | the serviceman shall be subject to tax
under the Retailers' | ||||||
18 | Occupation Tax Act and the Use Tax Act.
However, if a
| ||||||
19 | primary serviceman who has made the election described in | ||||||
20 | this paragraph
subcontracts service work to a secondary | ||||||
21 | serviceman who has also made the
election described in this | ||||||
22 | paragraph, the primary serviceman does not
incur a Use Tax | ||||||
23 | liability if the secondary serviceman (i) has paid or will | ||||||
24 | pay
Use
Tax on his or her cost price of any tangible | ||||||
25 | personal property transferred
to the primary serviceman | ||||||
26 | and (ii) certifies that fact in writing to the
primary
| ||||||
27 | serviceman.
| ||||||
28 | Tangible personal property transferred incident to the | ||||||
29 | completion of a
maintenance agreement is exempt from the tax | ||||||
30 | imposed pursuant to this Act.
| ||||||
31 | Exemption (5) also includes machinery and equipment used in | ||||||
32 | the general
maintenance or repair of such exempt machinery and | ||||||
33 | equipment or for in-house
manufacture of exempt machinery and | ||||||
34 | equipment. For the purposes of exemption
(5), each of these | ||||||
35 | terms shall have the following meanings: (1) "manufacturing
| ||||||
36 | process" shall mean the production of any article of tangible |
| |||||||
| |||||||
1 | personal
property, whether such article is a finished product | ||||||
2 | or an article for use in
the process of manufacturing or | ||||||
3 | assembling a different article of tangible
personal property, | ||||||
4 | by procedures commonly regarded as manufacturing,
processing, | ||||||
5 | fabricating, or refining which changes some existing
material | ||||||
6 | or materials into a material with a different form, use or
| ||||||
7 | name. In relation to a recognized integrated business composed | ||||||
8 | of a
series of operations which collectively constitute | ||||||
9 | manufacturing, or
individually constitute manufacturing | ||||||
10 | operations, the manufacturing
process shall be deemed to | ||||||
11 | commence with the first operation or stage of
production in the | ||||||
12 | series, and shall not be deemed to end until the
completion of | ||||||
13 | the final product in the last operation or stage of
production | ||||||
14 | in the series; and further, for purposes of exemption (5),
| ||||||
15 | photoprocessing is deemed to be a manufacturing process of | ||||||
16 | tangible
personal property for wholesale or retail sale; (2) | ||||||
17 | "assembling process" shall
mean the production of any article | ||||||
18 | of tangible personal property, whether such
article is a | ||||||
19 | finished product or an article for use in the process of
| ||||||
20 | manufacturing or assembling a different article of tangible | ||||||
21 | personal
property, by the combination of existing materials in | ||||||
22 | a manner commonly
regarded as assembling which results in a | ||||||
23 | material of a different form,
use or name; (3) "machinery" | ||||||
24 | shall mean major mechanical machines or
major components of | ||||||
25 | such machines contributing to a manufacturing or
assembling | ||||||
26 | process; and (4) "equipment" shall include any independent
| ||||||
27 | device or tool separate from any machinery but essential to an
| ||||||
28 | integrated manufacturing or assembly process; including | ||||||
29 | computers
used primarily in a manufacturer's computer
assisted | ||||||
30 | design, computer assisted manufacturing (CAD/CAM) system;
or | ||||||
31 | any subunit or assembly comprising a component of any machinery | ||||||
32 | or
auxiliary, adjunct or attachment parts of machinery, such as | ||||||
33 | tools, dies,
jigs, fixtures, patterns and molds; or any parts | ||||||
34 | which require periodic
replacement in the course of normal | ||||||
35 | operation; but shall not include hand
tools.
Equipment includes | ||||||
36 | chemicals or chemicals acting as catalysts but only if the
|
| |||||||
| |||||||
1 | chemicals or chemicals acting as catalysts effect a direct and | ||||||
2 | immediate change
upon a
product being manufactured or assembled | ||||||
3 | for wholesale or retail sale or
lease.
The purchaser of such | ||||||
4 | machinery and equipment who has an active
resale registration | ||||||
5 | number shall furnish such number to the seller at the
time of | ||||||
6 | purchase. The user of such machinery and equipment and tools
| ||||||
7 | without an active resale registration number shall prepare a | ||||||
8 | certificate of
exemption for each transaction stating facts | ||||||
9 | establishing the exemption for
that transaction, which | ||||||
10 | certificate shall be available to the Department
for inspection | ||||||
11 | or audit. The Department shall prescribe the form of the
| ||||||
12 | certificate.
| ||||||
13 | Any informal rulings, opinions or letters issued by the | ||||||
14 | Department in
response to an inquiry or request for any opinion | ||||||
15 | from any person
regarding the coverage and applicability of | ||||||
16 | exemption (5) to specific
devices shall be published, | ||||||
17 | maintained as a public record, and made
available for public | ||||||
18 | inspection and copying. If the informal ruling,
opinion or | ||||||
19 | letter contains trade secrets or other confidential
| ||||||
20 | information, where possible the Department shall delete such | ||||||
21 | information
prior to publication. Whenever such informal | ||||||
22 | rulings, opinions, or
letters contain any policy of general | ||||||
23 | applicability, the Department
shall formulate and adopt such | ||||||
24 | policy as a rule in accordance with the
provisions of the | ||||||
25 | Illinois Administrative Procedure Act.
| ||||||
26 | On and after July 1, 1987, no entity otherwise eligible | ||||||
27 | under exemption
(3) of this Section shall make tax free | ||||||
28 | purchases unless it has an active
exemption identification | ||||||
29 | number issued by the Department.
| ||||||
30 | The purchase, employment and transfer of such tangible | ||||||
31 | personal
property as newsprint and ink for the primary purpose | ||||||
32 | of conveying news
(with or without other information) is not a | ||||||
33 | purchase, use or sale of
service or of tangible personal | ||||||
34 | property within the meaning of this Act.
| ||||||
35 | "Serviceman" means any person who is engaged in the | ||||||
36 | occupation of
making sales of service.
|
| |||||||
| |||||||
1 | "Sale at retail" means "sale at retail" as defined in the | ||||||
2 | Retailers'
Occupation Tax Act.
| ||||||
3 | "Supplier" means any person who makes sales of tangible | ||||||
4 | personal
property to servicemen for the purpose of resale as an | ||||||
5 | incident to a
sale of service.
| ||||||
6 | "Serviceman maintaining a place of business in this State", | ||||||
7 | or any
like term, means and includes any serviceman:
| ||||||
8 | 1. having or maintaining within this State, directly or | ||||||
9 | by a
subsidiary, an office, distribution house, sales | ||||||
10 | house, warehouse or
other place of business, or any agent | ||||||
11 | or other representative operating
within this State under | ||||||
12 | the authority of the serviceman or its
subsidiary, | ||||||
13 | irrespective of whether such place of business or agent or
| ||||||
14 | other representative is located here permanently or | ||||||
15 | temporarily, or
whether such serviceman or subsidiary is | ||||||
16 | licensed to do business in this
State;
| ||||||
17 | 2. soliciting orders for tangible personal property by | ||||||
18 | means of a
telecommunication or television shopping system | ||||||
19 | (which utilizes toll free
numbers) which is intended by the | ||||||
20 | retailer to be broadcast by cable
television or other means | ||||||
21 | of broadcasting, to consumers located in this State;
| ||||||
22 | 3. pursuant to a contract with a broadcaster or | ||||||
23 | publisher located in this
State, soliciting orders for | ||||||
24 | tangible personal property by means of advertising
which is | ||||||
25 | disseminated primarily to consumers located in this State | ||||||
26 | and only
secondarily to bordering jurisdictions;
| ||||||
27 | 4. soliciting orders for tangible personal property by | ||||||
28 | mail if the
solicitations are substantial and recurring and | ||||||
29 | if the retailer benefits
from any banking, financing, debt | ||||||
30 | collection, telecommunication, or
marketing activities | ||||||
31 | occurring in this State or benefits from the location
in | ||||||
32 | this State of authorized installation, servicing, or | ||||||
33 | repair facilities;
| ||||||
34 | 5. being owned or controlled by the same interests | ||||||
35 | which own or
control any retailer engaging in business in | ||||||
36 | the same or similar line of
business in this State;
|
| |||||||
| |||||||
1 | 6. having a franchisee or licensee operating under its | ||||||
2 | trade name if
the franchisee or licensee is required to | ||||||
3 | collect the tax under this Section;
| ||||||
4 | 7. pursuant to a contract with a cable television | ||||||
5 | operator located in
this State, soliciting orders for | ||||||
6 | tangible personal property by means of
advertising which is | ||||||
7 | transmitted or distributed over a cable television
system | ||||||
8 | in this State; or
| ||||||
9 | 8. engaging in activities in Illinois, which | ||||||
10 | activities in the
state in which the supply business | ||||||
11 | engaging in such activities is located
would constitute | ||||||
12 | maintaining a place of business in that state.
| ||||||
13 | (Source: P.A. 92-484, eff. 8-23-01; 93-23, eff. 6-20-03; 93-24, | ||||||
14 | eff.
6-20-03; revised 8-21-03.)
| ||||||
15 | Section 20. The Service Occupation Tax Act is amended by | ||||||
16 | changing Section 2
as follows:
| ||||||
17 | (35 ILCS 115/2)
(from Ch. 120, par. 439.102)
| ||||||
18 | Sec. 2. "Transfer" means any transfer of the title to | ||||||
19 | property or of
the ownership of property whether or not the | ||||||
20 | transferor retains title as
security for the payment of amounts | ||||||
21 | due him from the transferee.
| ||||||
22 | "Cost Price" means the consideration paid by the serviceman | ||||||
23 | for a
purchase valued in money, whether paid in money or | ||||||
24 | otherwise, including
cash, credits and services, and shall be | ||||||
25 | determined without any deduction
on account of the supplier's | ||||||
26 | cost of the property sold or on account of any
other expense | ||||||
27 | incurred by the supplier. When a serviceman contracts out
part | ||||||
28 | or all of the services required in his sale of service, it | ||||||
29 | shall be
presumed that the cost price to the serviceman of the | ||||||
30 | property
transferred to him by his or her subcontractor is | ||||||
31 | equal to 50% of the
subcontractor's charges to the serviceman | ||||||
32 | in the absence of proof of the
consideration paid by the | ||||||
33 | subcontractor for the purchase of such
property.
| ||||||
34 | "Department" means the Department of Revenue.
|
| |||||||
| |||||||
1 | "Person" means any natural individual, firm, partnership, | ||||||
2 | association, joint
stock company, joint venture, public or | ||||||
3 | private corporation, limited liability
company, and any | ||||||
4 | receiver, executor, trustee, guardian or other representative
| ||||||
5 | appointed by order of any court.
| ||||||
6 | "Sale of Service" means any transaction except:
| ||||||
7 | (a) A retail sale of tangible personal property taxable | ||||||
8 | under the Retailers'
Occupation Tax Act or under the Use Tax | ||||||
9 | Act.
| ||||||
10 | (b) A sale of tangible personal property for the purpose of | ||||||
11 | resale made in
compliance with Section 2c of the Retailers' | ||||||
12 | Occupation Tax Act.
| ||||||
13 | (c) Except as hereinafter provided, a sale or transfer of | ||||||
14 | tangible personal
property as an incident to the rendering of | ||||||
15 | service for or by any governmental
body or for or by any | ||||||
16 | corporation, society, association, foundation or
institution | ||||||
17 | organized and operated exclusively for charitable, religious | ||||||
18 | or
educational purposes or any not-for-profit corporation, | ||||||
19 | society, association,
foundation, institution or organization | ||||||
20 | which has no compensated officers or
employees and which is | ||||||
21 | organized and operated primarily for the recreation of
persons | ||||||
22 | 55 years of age or older. A limited liability company may | ||||||
23 | qualify for
the exemption under this paragraph only if the | ||||||
24 | limited liability company is
organized and operated | ||||||
25 | exclusively for educational purposes.
| ||||||
26 | (d) A sale or transfer of tangible personal
property
as an | ||||||
27 | incident to the
rendering of service for interstate carriers | ||||||
28 | for hire for use as rolling stock
moving in interstate commerce | ||||||
29 | or lessors under leases of one year or longer,
executed or in | ||||||
30 | effect at the time of purchase, to interstate carriers for hire
| ||||||
31 | for use as rolling stock moving in interstate commerce, and | ||||||
32 | equipment operated
by a telecommunications provider, licensed | ||||||
33 | as a common
carrier by the Federal Communications Commission, | ||||||
34 | which is permanently
installed in or affixed to aircraft moving | ||||||
35 | in interstate commerce.
| ||||||
36 | (d-1) A sale or transfer of tangible personal
property as |
| |||||||
| |||||||
1 | an incident to
the rendering of service for owners, lessors or | ||||||
2 | shippers of tangible personal
property which is utilized by | ||||||
3 | interstate carriers for hire for use as rolling
stock moving in | ||||||
4 | interstate commerce, and equipment operated
by a | ||||||
5 | telecommunications provider, licensed as a common carrier by | ||||||
6 | the
Federal Communications Commission, which is permanently | ||||||
7 | installed in or
affixed to aircraft moving in interstate | ||||||
8 | commerce.
| ||||||
9 | (d-1.1) On and after July 1, 2003 and through June 30, | ||||||
10 | 2004 , a sale or
transfer of a motor vehicle
of the
second | ||||||
11 | division with a gross vehicle weight in excess of 8,000 pounds | ||||||
12 | as an
incident to the rendering of service if that motor
| ||||||
13 | vehicle is subject
to the commercial distribution fee imposed | ||||||
14 | under Section 3-815.1 of the
Illinois Vehicle
Code. This | ||||||
15 | exemption applies to repair and replacement parts added after | ||||||
16 | the
initial
purchase of such a motor vehicle if that motor | ||||||
17 | vehicle is used in a manner that
would
qualify for the rolling | ||||||
18 | stock exemption otherwise provided for in this Act.
| ||||||
19 | (d-2) The repairing, reconditioning or remodeling, for a | ||||||
20 | common carrier by
rail, of tangible personal property which | ||||||
21 | belongs to such carrier for hire, and
as to which such carrier | ||||||
22 | receives the physical possession of the repaired,
| ||||||
23 | reconditioned or remodeled item of tangible personal property | ||||||
24 | in Illinois, and
which such carrier transports, or shares with | ||||||
25 | another common carrier in the
transportation of such property, | ||||||
26 | out of Illinois on a standard uniform bill of
lading showing | ||||||
27 | the person who repaired, reconditioned or remodeled the | ||||||
28 | property
as the shipper or consignor of such property to a | ||||||
29 | destination outside Illinois,
for use outside Illinois.
| ||||||
30 | (d-3) A sale or transfer of tangible personal property | ||||||
31 | which
is produced by the seller thereof on special order in | ||||||
32 | such a way as to have
made the applicable tax the Service | ||||||
33 | Occupation Tax or the Service Use Tax,
rather than the | ||||||
34 | Retailers' Occupation Tax or the Use Tax, for an interstate
| ||||||
35 | carrier by rail which receives the physical possession of such | ||||||
36 | property in
Illinois, and which transports such property, or |
| |||||||
| |||||||
1 | shares with another common
carrier in the transportation of | ||||||
2 | such property, out of Illinois on a standard
uniform bill of | ||||||
3 | lading showing the seller of the property as the shipper or
| ||||||
4 | consignor of such property to a destination outside Illinois, | ||||||
5 | for use outside
Illinois.
| ||||||
6 | (d-4) Until January 1, 1997, a sale, by a registered | ||||||
7 | serviceman paying tax
under this Act to the Department, of | ||||||
8 | special order printed materials delivered
outside Illinois and | ||||||
9 | which are not returned to this State, if delivery is made
by | ||||||
10 | the seller or agent of the seller, including an agent who | ||||||
11 | causes the product
to be delivered outside Illinois by a common | ||||||
12 | carrier or the U.S.
postal service.
| ||||||
13 | (e) A sale or transfer of machinery and equipment used | ||||||
14 | primarily in
the process of the manufacturing or assembling, | ||||||
15 | either in an existing, an
expanded or a new manufacturing | ||||||
16 | facility, of tangible personal property for
wholesale or retail | ||||||
17 | sale or lease, whether such sale or lease is made directly
by | ||||||
18 | the manufacturer or by some other person, whether the materials | ||||||
19 | used in the
process are owned by the manufacturer or some other | ||||||
20 | person, or whether such
sale or lease is made apart from or as | ||||||
21 | an incident to the seller's engaging in
a service occupation | ||||||
22 | and the applicable tax is a Service Occupation Tax or
Service | ||||||
23 | Use Tax, rather than Retailers' Occupation Tax or Use Tax.
| ||||||
24 | (f) Until July 1, 2003, the sale or transfer of | ||||||
25 | distillation
machinery
and equipment, sold as a
unit or kit and | ||||||
26 | assembled or installed by the retailer, which machinery
and | ||||||
27 | equipment is certified by the user to be used only for the | ||||||
28 | production
of ethyl alcohol that will be used for consumption | ||||||
29 | as motor fuel or as a
component of motor fuel for the personal | ||||||
30 | use of such user and not subject
to sale or resale.
| ||||||
31 | (g) At the election of any serviceman not required to be | ||||||
32 | otherwise
registered as a retailer under Section 2a of the | ||||||
33 | Retailers' Occupation Tax Act,
made for each fiscal year sales | ||||||
34 | of service in which the aggregate annual cost
price of tangible | ||||||
35 | personal property transferred as an incident to the sales of
| ||||||
36 | service is less than 35% (75% in the case of servicemen |
| |||||||
| |||||||
1 | transferring
prescription drugs or servicemen engaged in | ||||||
2 | graphic arts production) of the
aggregate annual total gross | ||||||
3 | receipts from all sales of service. The purchase
of such | ||||||
4 | tangible personal property by the serviceman shall be subject | ||||||
5 | to tax
under the Retailers' Occupation Tax Act and the Use Tax | ||||||
6 | Act.
However, if a
primary serviceman who has made the election | ||||||
7 | described in this paragraph
subcontracts service work to a | ||||||
8 | secondary serviceman who has also made the
election described | ||||||
9 | in this paragraph, the primary serviceman does not
incur a Use | ||||||
10 | Tax liability if the secondary serviceman (i) has paid or will | ||||||
11 | pay
Use
Tax on his or her cost price of any tangible personal | ||||||
12 | property transferred
to the primary serviceman and (ii) | ||||||
13 | certifies that fact in writing to the
primary serviceman.
| ||||||
14 | Tangible personal property transferred incident to the | ||||||
15 | completion of a
maintenance agreement is exempt from the tax | ||||||
16 | imposed pursuant to this Act.
| ||||||
17 | Exemption (e) also includes machinery and equipment used in | ||||||
18 | the
general maintenance or repair of such exempt machinery and | ||||||
19 | equipment or for
in-house manufacture of exempt machinery and | ||||||
20 | equipment.
For the purposes of exemption (e), each of these | ||||||
21 | terms shall have the following
meanings: (1) "manufacturing | ||||||
22 | process" shall mean the production of any
article of tangible | ||||||
23 | personal property, whether such article is a
finished product | ||||||
24 | or an article for use in the process of manufacturing
or | ||||||
25 | assembling a different article of tangible personal property, | ||||||
26 | by
procedures commonly regarded as manufacturing, processing, | ||||||
27 | fabricating,
or refining which changes some existing material | ||||||
28 | or materials into a
material with a different form, use or | ||||||
29 | name. In relation to a
recognized integrated business composed | ||||||
30 | of a series of operations which
collectively constitute | ||||||
31 | manufacturing, or individually constitute
manufacturing | ||||||
32 | operations, the manufacturing process shall be deemed to
| ||||||
33 | commence with the first operation or stage of production in the | ||||||
34 | series,
and shall not be deemed to end until the completion of | ||||||
35 | the final product
in the last operation or stage of production | ||||||
36 | in the series; and further for
purposes of exemption (e), |
| |||||||
| |||||||
1 | photoprocessing is deemed to be a manufacturing
process of | ||||||
2 | tangible personal property for wholesale or retail sale;
(2) | ||||||
3 | "assembling process" shall mean the production of any article | ||||||
4 | of
tangible personal property, whether such article is a | ||||||
5 | finished product
or an article for use in the process of | ||||||
6 | manufacturing or assembling a
different article of tangible | ||||||
7 | personal property, by the combination of
existing materials in | ||||||
8 | a manner commonly regarded as assembling which
results in a | ||||||
9 | material of a different form, use or name; (3) "machinery"
| ||||||
10 | shall mean major mechanical machines or major components of | ||||||
11 | such machines
contributing to a manufacturing or assembling | ||||||
12 | process; and (4) "equipment"
shall include any independent | ||||||
13 | device or tool separate from any machinery but
essential to an | ||||||
14 | integrated manufacturing or assembly process; including
| ||||||
15 | computers used primarily in a manufacturer's computer
assisted | ||||||
16 | design, computer assisted manufacturing (CAD/CAM) system; or | ||||||
17 | any
subunit or assembly comprising a component of any machinery | ||||||
18 | or auxiliary,
adjunct or attachment parts of machinery, such as | ||||||
19 | tools, dies, jigs, fixtures,
patterns and molds; or any parts | ||||||
20 | which require periodic replacement in the
course of normal | ||||||
21 | operation; but shall not include hand tools. Equipment
includes | ||||||
22 | chemicals or chemicals acting as catalysts but only if the | ||||||
23 | chemicals
or chemicals acting as catalysts effect a direct and | ||||||
24 | immediate change upon a
product being manufactured or assembled | ||||||
25 | for wholesale or retail sale or lease.
The purchaser of such | ||||||
26 | machinery and equipment
who has an active resale registration | ||||||
27 | number shall furnish such number to
the seller at the time of | ||||||
28 | purchase. The purchaser of such machinery and
equipment and | ||||||
29 | tools without an active resale registration number shall | ||||||
30 | furnish
to the seller a certificate of exemption for each | ||||||
31 | transaction stating facts
establishing the exemption for that | ||||||
32 | transaction, which certificate shall
be available to the | ||||||
33 | Department for inspection or audit.
| ||||||
34 | Except as provided in Section 2d of this Act, the rolling | ||||||
35 | stock exemption
applies to rolling
stock
used by an interstate
| ||||||
36 | carrier for hire, even just between points in Illinois, if such |
| |||||||
| |||||||
1 | rolling
stock transports, for hire, persons whose journeys or | ||||||
2 | property whose
shipments originate or terminate outside | ||||||
3 | Illinois.
| ||||||
4 | Any informal rulings, opinions or letters issued by the | ||||||
5 | Department in
response to an inquiry or request for any opinion | ||||||
6 | from any person
regarding the coverage and applicability of | ||||||
7 | exemption (e) to specific
devices shall be published, | ||||||
8 | maintained as a public record, and made
available for public | ||||||
9 | inspection and copying. If the informal ruling,
opinion or | ||||||
10 | letter contains trade secrets or other confidential
| ||||||
11 | information, where possible the Department shall delete such | ||||||
12 | information
prior to publication. Whenever such informal | ||||||
13 | rulings, opinions, or
letters contain any policy of general | ||||||
14 | applicability, the Department
shall formulate and adopt such | ||||||
15 | policy as a rule in accordance with the
provisions of the | ||||||
16 | Illinois Administrative Procedure Act.
| ||||||
17 | On and after July 1, 1987, no entity otherwise eligible | ||||||
18 | under exemption
(c) of this Section shall make tax free | ||||||
19 | purchases unless it has an active
exemption identification | ||||||
20 | number issued by the Department.
| ||||||
21 | "Serviceman" means any person who is engaged in the | ||||||
22 | occupation of
making sales of service.
| ||||||
23 | "Sale at Retail" means "sale at retail" as defined in the | ||||||
24 | Retailers'
Occupation Tax Act.
| ||||||
25 | "Supplier" means any person who makes sales of tangible | ||||||
26 | personal
property to servicemen for the purpose of resale as an | ||||||
27 | incident to a
sale of service.
| ||||||
28 | (Source: P.A. 92-484, eff. 8-23-01;
93-23, eff. 6-20-03; 93-24, | ||||||
29 | eff. 6-20-03; revised 8-21-03.)
| ||||||
30 | Section 25. The Retailers' Occupation Tax Act is amended | ||||||
31 | by changing
Section 2-5 as follows:
| ||||||
32 | (35 ILCS 120/2-5)
(from Ch. 120, par. 441-5)
| ||||||
33 | Sec. 2-5. Exemptions. Gross receipts from proceeds from the | ||||||
34 | sale of
the following tangible personal property are exempt |
| |||||||
| |||||||
1 | from the tax imposed
by this Act:
| ||||||
2 | (1) Farm chemicals.
| ||||||
3 | (2) Farm machinery and equipment, both new and used, | ||||||
4 | including that
manufactured on special order, certified by the | ||||||
5 | purchaser to be used
primarily for production agriculture or | ||||||
6 | State or federal agricultural
programs, including individual | ||||||
7 | replacement parts for the machinery and
equipment, including | ||||||
8 | machinery and equipment purchased for lease,
and including | ||||||
9 | implements of husbandry defined in Section 1-130 of
the | ||||||
10 | Illinois Vehicle Code, farm machinery and agricultural | ||||||
11 | chemical and
fertilizer spreaders, and nurse wagons required to | ||||||
12 | be registered
under Section 3-809 of the Illinois Vehicle Code,
| ||||||
13 | but
excluding other motor vehicles required to be registered | ||||||
14 | under the Illinois
Vehicle Code.
Horticultural polyhouses or | ||||||
15 | hoop houses used for propagating, growing, or
overwintering | ||||||
16 | plants shall be considered farm machinery and equipment under
| ||||||
17 | this item (2).
Agricultural chemical tender tanks and dry boxes | ||||||
18 | shall include units sold
separately from a motor vehicle | ||||||
19 | required to be licensed and units sold mounted
on a motor | ||||||
20 | vehicle required to be licensed, if the selling price of the | ||||||
21 | tender
is separately stated.
| ||||||
22 | Farm machinery and equipment shall include precision | ||||||
23 | farming equipment
that is
installed or purchased to be | ||||||
24 | installed on farm machinery and equipment
including, but not | ||||||
25 | limited to, tractors, harvesters, sprayers, planters,
seeders, | ||||||
26 | or spreaders.
Precision farming equipment includes, but is not | ||||||
27 | limited to,
soil testing sensors, computers, monitors, | ||||||
28 | software, global positioning
and mapping systems, and other | ||||||
29 | such equipment.
| ||||||
30 | Farm machinery and equipment also includes computers, | ||||||
31 | sensors, software, and
related equipment used primarily in the
| ||||||
32 | computer-assisted operation of production agriculture | ||||||
33 | facilities, equipment,
and activities such as, but
not limited | ||||||
34 | to,
the collection, monitoring, and correlation of
animal and | ||||||
35 | crop data for the purpose of
formulating animal diets and | ||||||
36 | agricultural chemicals. This item (7) is exempt
from the |
| |||||||
| |||||||
1 | provisions of
Section 2-70.
| ||||||
2 | (3) Until July 1, 2003, distillation machinery and | ||||||
3 | equipment, sold as a
unit or kit,
assembled or installed by the | ||||||
4 | retailer, certified by the user to be used
only for the | ||||||
5 | production of ethyl alcohol that will be used for consumption
| ||||||
6 | as motor fuel or as a component of motor fuel for the personal | ||||||
7 | use of the
user, and not subject to sale or resale.
| ||||||
8 | (4) Until July 1, 2003, graphic arts machinery and | ||||||
9 | equipment, including
repair and
replacement parts, both new and | ||||||
10 | used, and including that manufactured on
special order or | ||||||
11 | purchased for lease, certified by the purchaser to be used
| ||||||
12 | primarily for graphic arts production.
Equipment includes | ||||||
13 | chemicals or
chemicals acting as catalysts but only if
the | ||||||
14 | chemicals or chemicals acting as catalysts effect a direct and | ||||||
15 | immediate
change upon a
graphic arts product.
| ||||||
16 | (5) A motor vehicle of the first division, a motor vehicle | ||||||
17 | of the second
division that is a self-contained motor vehicle | ||||||
18 | designed or permanently
converted to provide living quarters | ||||||
19 | for recreational, camping, or travel
use, with direct walk | ||||||
20 | through access to the living quarters from the
driver's seat, | ||||||
21 | or a motor vehicle of the second division that is of the van
| ||||||
22 | configuration designed for the transportation of not less than | ||||||
23 | 7 nor more
than 16 passengers, as defined in Section 1-146 of | ||||||
24 | the Illinois Vehicle
Code, that is used for automobile renting, | ||||||
25 | as defined in the Automobile
Renting Occupation and Use Tax | ||||||
26 | Act.
| ||||||
27 | (6) Personal property sold by a teacher-sponsored student | ||||||
28 | organization
affiliated with an elementary or secondary school | ||||||
29 | located in Illinois.
| ||||||
30 | (7) Until July 1, 2003, proceeds of that portion of the | ||||||
31 | selling price of
a passenger car the
sale of which is subject | ||||||
32 | to the Replacement Vehicle Tax.
| ||||||
33 | (8) Personal property sold to an Illinois county fair | ||||||
34 | association for
use in conducting, operating, or promoting the | ||||||
35 | county fair.
| ||||||
36 | (9) Personal property sold to a not-for-profit arts
or |
| |||||||
| |||||||
1 | cultural organization that establishes, by proof required by | ||||||
2 | the Department
by
rule, that it has received an exemption under | ||||||
3 | Section 501(c)(3) of the
Internal Revenue Code and that is | ||||||
4 | organized and operated primarily for the
presentation
or | ||||||
5 | support of arts or cultural programming, activities, or | ||||||
6 | services. These
organizations include, but are not limited to, | ||||||
7 | music and dramatic arts
organizations such as symphony | ||||||
8 | orchestras and theatrical groups, arts and
cultural service | ||||||
9 | organizations, local arts councils, visual arts organizations,
| ||||||
10 | and media arts organizations.
On and after the effective date | ||||||
11 | of this amendatory Act of the 92nd General
Assembly, however, | ||||||
12 | an entity otherwise eligible for this exemption shall not
make | ||||||
13 | tax-free purchases unless it has an active identification | ||||||
14 | number issued by
the Department.
| ||||||
15 | (10) Personal property sold by a corporation, society, | ||||||
16 | association,
foundation, institution, or organization, other | ||||||
17 | than a limited liability
company, that is organized and | ||||||
18 | operated as a not-for-profit service enterprise
for the benefit | ||||||
19 | of persons 65 years of age or older if the personal property
| ||||||
20 | was not purchased by the enterprise for the purpose of resale | ||||||
21 | by the
enterprise.
| ||||||
22 | (11) Personal property sold to a governmental body, to a | ||||||
23 | corporation,
society, association, foundation, or institution | ||||||
24 | organized and operated
exclusively for charitable, religious, | ||||||
25 | or educational purposes, or to a
not-for-profit corporation, | ||||||
26 | society, association, foundation, institution,
or organization | ||||||
27 | that has no compensated officers or employees and that is
| ||||||
28 | organized and operated primarily for the recreation of persons | ||||||
29 | 55 years of
age or older. A limited liability company may | ||||||
30 | qualify for the exemption under
this paragraph only if the | ||||||
31 | limited liability company is organized and operated
| ||||||
32 | exclusively for educational purposes. On and after July 1, | ||||||
33 | 1987, however, no
entity otherwise eligible for this exemption | ||||||
34 | shall make tax-free purchases
unless it has an active | ||||||
35 | identification number issued by the Department.
| ||||||
36 | (12) Tangible personal property sold to
interstate |
| |||||||
| |||||||
1 | carriers
for hire for use as
rolling stock moving in interstate | ||||||
2 | commerce or to lessors under leases of
one year or longer | ||||||
3 | executed or in effect at the time of purchase by
interstate | ||||||
4 | carriers for hire for use as rolling stock moving in interstate
| ||||||
5 | commerce and equipment operated by a telecommunications | ||||||
6 | provider, licensed as a
common carrier by the Federal | ||||||
7 | Communications Commission, which is permanently
installed in | ||||||
8 | or affixed to aircraft moving in interstate commerce.
| ||||||
9 | (12-5) On and after July 1, 2003 and through June 30, 2004 , | ||||||
10 | motor
vehicles of the second division
with a gross vehicle | ||||||
11 | weight in excess of 8,000 pounds
that
are
subject to the | ||||||
12 | commercial distribution fee imposed under Section 3-815.1 of
| ||||||
13 | the Illinois
Vehicle Code. This exemption applies to repair and | ||||||
14 | replacement parts added
after the
initial purchase of such a | ||||||
15 | motor vehicle if that motor vehicle is used in a
manner that
| ||||||
16 | would qualify for the rolling stock exemption otherwise | ||||||
17 | provided for in this
Act.
| ||||||
18 | (13) Proceeds from sales to owners, lessors, or
shippers of
| ||||||
19 | tangible personal property that is utilized by interstate | ||||||
20 | carriers for
hire for use as rolling stock moving in interstate | ||||||
21 | commerce
and equipment operated by a telecommunications | ||||||
22 | provider, licensed as a
common carrier by the Federal | ||||||
23 | Communications Commission, which is
permanently installed in | ||||||
24 | or affixed to aircraft moving in interstate commerce.
| ||||||
25 | (14) Machinery and equipment that will be used by the | ||||||
26 | purchaser, or a
lessee of the purchaser, primarily in the | ||||||
27 | process of manufacturing or
assembling tangible personal | ||||||
28 | property for wholesale or retail sale or
lease, whether the | ||||||
29 | sale or lease is made directly by the manufacturer or by
some | ||||||
30 | other person, whether the materials used in the process are | ||||||
31 | owned by
the manufacturer or some other person, or whether the | ||||||
32 | sale or lease is made
apart from or as an incident to the | ||||||
33 | seller's engaging in the service
occupation of producing | ||||||
34 | machines, tools, dies, jigs, patterns, gauges, or
other similar | ||||||
35 | items of no commercial value on special order for a particular
| ||||||
36 | purchaser.
|
| |||||||
| |||||||
1 | (15) Proceeds of mandatory service charges separately | ||||||
2 | stated on
customers' bills for purchase and consumption of food | ||||||
3 | and beverages, to the
extent that the proceeds of the service | ||||||
4 | charge are in fact turned over as
tips or as a substitute for | ||||||
5 | tips to the employees who participate directly
in preparing, | ||||||
6 | serving, hosting or cleaning up the food or beverage function
| ||||||
7 | with respect to which the service charge is imposed.
| ||||||
8 | (16) Petroleum products sold to a purchaser if the seller
| ||||||
9 | is prohibited by federal law from charging tax to the | ||||||
10 | purchaser.
| ||||||
11 | (17) Tangible personal property sold to a common carrier by | ||||||
12 | rail or
motor that
receives the physical possession of the | ||||||
13 | property in Illinois and that
transports the property, or | ||||||
14 | shares with another common carrier in the
transportation of the | ||||||
15 | property, out of Illinois on a standard uniform bill
of lading | ||||||
16 | showing the seller of the property as the shipper or consignor | ||||||
17 | of
the property to a destination outside Illinois, for use | ||||||
18 | outside Illinois.
| ||||||
19 | (18) Legal tender, currency, medallions, or gold or silver | ||||||
20 | coinage
issued by the State of Illinois, the government of the | ||||||
21 | United States of
America, or the government of any foreign | ||||||
22 | country, and bullion.
| ||||||
23 | (19) Until July 1 2003, oil field exploration, drilling, | ||||||
24 | and production
equipment, including
(i) rigs and parts of rigs, | ||||||
25 | rotary rigs, cable tool
rigs, and workover rigs, (ii) pipe and | ||||||
26 | tubular goods, including casing and
drill strings, (iii) pumps | ||||||
27 | and pump-jack units, (iv) storage tanks and flow
lines, (v) any | ||||||
28 | individual replacement part for oil field exploration,
| ||||||
29 | drilling, and production equipment, and (vi) machinery and | ||||||
30 | equipment purchased
for lease; but
excluding motor vehicles | ||||||
31 | required to be registered under the Illinois
Vehicle Code.
| ||||||
32 | (20) Photoprocessing machinery and equipment, including | ||||||
33 | repair and
replacement parts, both new and used, including that | ||||||
34 | manufactured on
special order, certified by the purchaser to be | ||||||
35 | used primarily for
photoprocessing, and including | ||||||
36 | photoprocessing machinery and equipment
purchased for lease.
|
| |||||||
| |||||||
1 | (21) Until July 1, 2003, coal exploration, mining, | ||||||
2 | offhighway hauling,
processing,
maintenance, and reclamation | ||||||
3 | equipment, including
replacement parts and equipment, and | ||||||
4 | including
equipment purchased for lease, but excluding motor | ||||||
5 | vehicles required to be
registered under the Illinois Vehicle | ||||||
6 | Code.
| ||||||
7 | (22) Fuel and petroleum products sold to or used by an air | ||||||
8 | carrier,
certified by the carrier to be used for consumption, | ||||||
9 | shipment, or storage
in the conduct of its business as an air | ||||||
10 | common carrier, for a flight
destined for or returning from a | ||||||
11 | location or locations
outside the United States without regard | ||||||
12 | to previous or subsequent domestic
stopovers.
| ||||||
13 | (23) A transaction in which the purchase order is received | ||||||
14 | by a florist
who is located outside Illinois, but who has a | ||||||
15 | florist located in Illinois
deliver the property to the | ||||||
16 | purchaser or the purchaser's donee in Illinois.
| ||||||
17 | (24) Fuel consumed or used in the operation of ships, | ||||||
18 | barges, or vessels
that are used primarily in or for the | ||||||
19 | transportation of property or the
conveyance of persons for | ||||||
20 | hire on rivers bordering on this State if the
fuel is delivered | ||||||
21 | by the seller to the purchaser's barge, ship, or vessel
while | ||||||
22 | it is afloat upon that bordering river.
| ||||||
23 | (25) A motor vehicle sold in this State to a nonresident | ||||||
24 | even though the
motor vehicle is delivered to the nonresident | ||||||
25 | in this State, if the motor
vehicle is not to be titled in this | ||||||
26 | State, and if a drive-away permit
is issued to the motor | ||||||
27 | vehicle as provided in Section 3-603 of the Illinois
Vehicle | ||||||
28 | Code or if the nonresident purchaser has vehicle registration
| ||||||
29 | plates to transfer to the motor vehicle upon returning to his | ||||||
30 | or her home
state. The issuance of the drive-away permit or | ||||||
31 | having
the
out-of-state registration plates to be transferred | ||||||
32 | is prima facie evidence
that the motor vehicle will not be | ||||||
33 | titled in this State.
| ||||||
34 | (26) Semen used for artificial insemination of livestock | ||||||
35 | for direct
agricultural production.
| ||||||
36 | (27) Horses, or interests in horses, registered with and |
| |||||||
| |||||||
1 | meeting the
requirements of any of the
Arabian Horse Club | ||||||
2 | Registry of America, Appaloosa Horse Club, American Quarter
| ||||||
3 | Horse Association, United States
Trotting Association, or | ||||||
4 | Jockey Club, as appropriate, used for
purposes of breeding or | ||||||
5 | racing for prizes.
| ||||||
6 | (28) Computers and communications equipment utilized for | ||||||
7 | any
hospital
purpose
and equipment used in the diagnosis,
| ||||||
8 | analysis, or treatment of hospital patients sold to a lessor | ||||||
9 | who leases the
equipment, under a lease of one year or longer | ||||||
10 | executed or in effect at the
time of the purchase, to a
| ||||||
11 | hospital
that has been issued an active tax exemption | ||||||
12 | identification number by the
Department under Section 1g of | ||||||
13 | this Act.
| ||||||
14 | (29) Personal property sold to a lessor who leases the
| ||||||
15 | property, under a
lease of one year or longer executed or in | ||||||
16 | effect at the time of the purchase,
to a governmental body
that | ||||||
17 | has been issued an active tax exemption identification number | ||||||
18 | by the
Department under Section 1g of this Act.
| ||||||
19 | (30) Beginning with taxable years ending on or after | ||||||
20 | December
31, 1995
and
ending with taxable years ending on or | ||||||
21 | before December 31, 2004,
personal property that is
donated for | ||||||
22 | disaster relief to be used in a State or federally declared
| ||||||
23 | disaster area in Illinois or bordering Illinois by a | ||||||
24 | manufacturer or retailer
that is registered in this State to a | ||||||
25 | corporation, society, association,
foundation, or institution | ||||||
26 | that has been issued a sales tax exemption
identification | ||||||
27 | number by the Department that assists victims of the disaster
| ||||||
28 | who reside within the declared disaster area.
| ||||||
29 | (31) Beginning with taxable years ending on or after | ||||||
30 | December
31, 1995 and
ending with taxable years ending on or | ||||||
31 | before December 31, 2004, personal
property that is used in the | ||||||
32 | performance of infrastructure repairs in this
State, including | ||||||
33 | but not limited to municipal roads and streets, access roads,
| ||||||
34 | bridges, sidewalks, waste disposal systems, water and sewer | ||||||
35 | line extensions,
water distribution and purification | ||||||
36 | facilities, storm water drainage and
retention facilities, and |
| |||||||
| |||||||
1 | sewage treatment facilities, resulting from a State
or | ||||||
2 | federally declared disaster in Illinois or bordering Illinois | ||||||
3 | when such
repairs are initiated on facilities located in the | ||||||
4 | declared disaster area
within 6 months after the disaster.
| ||||||
5 | (32) Beginning July 1, 1999, game or game birds sold at a | ||||||
6 | "game breeding
and
hunting preserve area" or an "exotic game | ||||||
7 | hunting area" as those terms are used
in the
Wildlife Code or | ||||||
8 | at a hunting enclosure approved through rules adopted by the
| ||||||
9 | Department of Natural Resources. This paragraph is exempt from | ||||||
10 | the provisions
of
Section 2-70.
| ||||||
11 | (33) A motor vehicle, as that term is defined in Section | ||||||
12 | 1-146
of the
Illinois Vehicle Code, that is donated to a | ||||||
13 | corporation, limited liability
company, society, association, | ||||||
14 | foundation, or institution that is determined by
the Department | ||||||
15 | to be organized and operated exclusively for educational
| ||||||
16 | purposes. For purposes of this exemption, "a corporation, | ||||||
17 | limited liability
company, society, association, foundation, | ||||||
18 | or institution organized and
operated
exclusively for | ||||||
19 | educational purposes" means all tax-supported public schools,
| ||||||
20 | private schools that offer systematic instruction in useful | ||||||
21 | branches of
learning by methods common to public schools and | ||||||
22 | that compare favorably in
their scope and intensity with the | ||||||
23 | course of study presented in tax-supported
schools, and | ||||||
24 | vocational or technical schools or institutes organized and
| ||||||
25 | operated exclusively to provide a course of study of not less | ||||||
26 | than 6 weeks
duration and designed to prepare individuals to | ||||||
27 | follow a trade or to pursue a
manual, technical, mechanical, | ||||||
28 | industrial, business, or commercial
occupation.
| ||||||
29 | (34) Beginning January 1, 2000, personal property, | ||||||
30 | including food, purchased
through fundraising events for the | ||||||
31 | benefit of a public or private elementary or
secondary school, | ||||||
32 | a group of those schools, or one or more school districts if
| ||||||
33 | the events are sponsored by an entity recognized by the school | ||||||
34 | district that
consists primarily of volunteers and includes | ||||||
35 | parents and teachers of the
school children. This paragraph | ||||||
36 | does not apply to fundraising events (i) for
the benefit of |
| |||||||
| |||||||
1 | private home instruction or (ii) for which the fundraising
| ||||||
2 | entity purchases the personal property sold at the events from | ||||||
3 | another
individual or entity that sold the property for the | ||||||
4 | purpose of resale by the
fundraising entity and that profits | ||||||
5 | from the sale to the fundraising entity.
This paragraph is | ||||||
6 | exempt from the provisions of Section 2-70.
| ||||||
7 | (35) Beginning January 1, 2000 and through December 31, | ||||||
8 | 2001, new or used
automatic vending machines that prepare and | ||||||
9 | serve hot food and beverages,
including coffee, soup, and other | ||||||
10 | items, and replacement parts for these
machines. Beginning | ||||||
11 | January 1, 2002 and through June 30, 2003, machines
and parts | ||||||
12 | for machines used in
commercial, coin-operated amusement and | ||||||
13 | vending business if a use or occupation
tax is paid on the | ||||||
14 | gross receipts derived from the use of the commercial,
| ||||||
15 | coin-operated amusement and vending machines. This paragraph | ||||||
16 | is exempt from
the provisions of Section 2-70.
| ||||||
17 | (35-5) Food for human consumption that is to be consumed | ||||||
18 | off
the premises where it is sold (other than alcoholic | ||||||
19 | beverages, soft drinks,
and food that has been prepared for | ||||||
20 | immediate consumption) and prescription
and nonprescription | ||||||
21 | medicines, drugs, medical appliances, and insulin, urine
| ||||||
22 | testing materials, syringes, and needles used by diabetics, for | ||||||
23 | human use, when
purchased for use by a person receiving medical | ||||||
24 | assistance under Article 5 of
the Illinois Public Aid Code who | ||||||
25 | resides in a licensed long-term care facility,
as defined in | ||||||
26 | the Nursing Home Care Act.
| ||||||
27 | (36) Beginning August 2, 2001, computers and | ||||||
28 | communications equipment
utilized for any hospital purpose and | ||||||
29 | equipment used in the diagnosis,
analysis, or treatment of | ||||||
30 | hospital patients sold to a lessor who leases the
equipment, | ||||||
31 | under a lease of one year or longer executed or in effect at | ||||||
32 | the
time of the purchase, to a hospital that has been issued an | ||||||
33 | active tax
exemption identification number by the Department | ||||||
34 | under Section 1g of this Act.
This paragraph is exempt from the | ||||||
35 | provisions of Section 2-70.
| ||||||
36 | (37) Beginning August 2, 2001, personal property sold to a |
| |||||||
| |||||||
1 | lessor who
leases the property, under a lease of one year or | ||||||
2 | longer executed or in effect
at the time of the purchase, to a | ||||||
3 | governmental body that has been issued an
active tax exemption | ||||||
4 | identification number by the Department under Section 1g
of | ||||||
5 | this Act. This paragraph is exempt from the provisions of | ||||||
6 | Section 2-70.
| ||||||
7 | (38) Beginning on January 1, 2002, tangible personal | ||||||
8 | property purchased
from an Illinois retailer by a taxpayer | ||||||
9 | engaged in centralized purchasing
activities in Illinois who | ||||||
10 | will, upon receipt of the property in Illinois,
temporarily | ||||||
11 | store the property in Illinois (i) for the purpose of | ||||||
12 | subsequently
transporting it outside this State for use or | ||||||
13 | consumption thereafter solely
outside this State or (ii) for | ||||||
14 | the purpose of being processed, fabricated, or
manufactured | ||||||
15 | into, attached to, or incorporated into other tangible personal
| ||||||
16 | property to be transported outside this State and thereafter | ||||||
17 | used or consumed
solely outside this State. The Director of | ||||||
18 | Revenue shall, pursuant to rules
adopted in accordance with the | ||||||
19 | Illinois Administrative Procedure Act, issue a
permit to any | ||||||
20 | taxpayer in good standing with the Department who is eligible | ||||||
21 | for
the exemption under this paragraph (38). The permit issued | ||||||
22 | under
this paragraph (38) shall authorize the holder, to the | ||||||
23 | extent and
in the manner specified in the rules adopted under | ||||||
24 | this Act, to purchase
tangible personal property from a | ||||||
25 | retailer exempt from the taxes imposed by
this Act. Taxpayers | ||||||
26 | shall maintain all necessary books and records to
substantiate | ||||||
27 | the use and consumption of all such tangible personal property
| ||||||
28 | outside of the State of Illinois.
| ||||||
29 | (Source: P.A. 92-16, eff. 6-28-01; 92-35, eff. 7-1-01; 92-227, | ||||||
30 | eff. 8-2-01;
92-337, eff.
8-10-01; 92-484, eff. 8-23-01; | ||||||
31 | 92-488, eff. 8-23-01; 92-651, eff. 7-11-02;
92-680, eff. | ||||||
32 | 7-16-02; 93-23, eff. 6-20-03; 93-24, eff.
6-20-03; revised | ||||||
33 | 9-11-03.)
| ||||||
34 | Section 30. The Illinois Vehicle Code is amended by | ||||||
35 | changing
Section 3-815.1 as follows:
|
| |||||||
| |||||||
1 | (625 ILCS 5/3-815.1)
| ||||||
2 | Sec. 3-815.1. Commercial distribution fee. Beginning July | ||||||
3 | 1, 2003 and through June 30, 2004 , in
addition to any tax or | ||||||
4 | fee imposed under this Code:
| ||||||
5 | (a) Vehicles of the second division with a gross | ||||||
6 | vehicle weight that
exceeds 8,000 pounds and that incur any | ||||||
7 | tax or fee under subsection (a) of
Section 3-815 of this | ||||||
8 | Code or subsection (a) of Section 3-818 of this Code, as
| ||||||
9 | applicable, and shall pay to the Secretary of State a | ||||||
10 | commercial
distribution fee, for each registration year, | ||||||
11 | for the use of the public
highways, State infrastructure, | ||||||
12 | and State services, in an amount equal to 36%
of the taxes | ||||||
13 | and fees incurred under subsection (a) of Section 3-815 of | ||||||
14 | this
Code, or subsection (a) of Section 3-818 of this Code, | ||||||
15 | as applicable, rounded
up to the nearest whole dollar.
| ||||||
16 | (b) Vehicles of the second division with a gross | ||||||
17 | vehicle weight of 8,000
pounds or less and that incur any | ||||||
18 | tax or fee under subsection (a) of Section
3-815 of this | ||||||
19 | Code or subsection (a) of Section 3-818 of this Code, as
| ||||||
20 | applicable, and have claimed the rolling stock exemption | ||||||
21 | under the Retailers'
Occupation Tax Act, Use Tax Act, | ||||||
22 | Service Occupation Tax Act, or Service Use Tax
Act shall | ||||||
23 | pay to the Illinois Department of Revenue (or the Secretary | ||||||
24 | of State
under an intergovernmental agreement) a | ||||||
25 | commercial distribution fee, for each
registration year, | ||||||
26 | for the use of the public highways, State infrastructure,
| ||||||
27 | and State services, in an amount equal to 36% of the taxes | ||||||
28 | and fees incurred
under subsection (a) of Section 3-815 of | ||||||
29 | this Code or subsection (a) of Section
3-818 of this Code, | ||||||
30 | as applicable, rounded up to the nearest whole dollar.
| ||||||
31 | The fees paid under this Section shall be deposited by the | ||||||
32 | Secretary of State
into the General Revenue Fund.
| ||||||
33 | (Source: P.A. 93-23, eff. 6-20-03; revised 10-9-03.)
| ||||||
34 | Section 99. Effective date. This Act takes effect upon |
| |||||||
| |||||||
1 | becoming law. |