Sen. Donne E. Trotter
Filed: 5/19/2004
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1 | AMENDMENT TO HOUSE BILL 7178
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2 | AMENDMENT NO. ______. Amend House Bill 7178 by replacing | ||||||
3 | everything after the enacting clause with the following:
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4 | "Section 3. The State Finance Act is amended by changing | ||||||
5 | Section 6z-45 as follows:
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6 | (30 ILCS 105/6z-45)
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7 | Sec. 6z-45. The School Infrastructure Fund.
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8 | (a) The School Infrastructure Fund is created as a special | ||||||
9 | fund
in the State Treasury.
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10 | In addition to any other deposits authorized by law, | ||||||
11 | beginning January
1, 2000, on the first day of each month, or | ||||||
12 | as soon thereafter as may be
practical, the State Treasurer and | ||||||
13 | State Comptroller shall transfer the sum of
$5,000,000 from the | ||||||
14 | General Revenue Fund to the School Infrastructure Fund;
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15 | provided, however, that no such transfers shall be made from | ||||||
16 | July 1, 2001
through June 30, 2003. | ||||||
17 | In addition to any other deposits authorized by this | ||||||
18 | Section or by any other law, beginning July
1, 2004, on the | ||||||
19 | first day of each month, or as soon thereafter as may be
| ||||||
20 | practical, the State Treasurer and State Comptroller shall | ||||||
21 | transfer amounts as directed by the Governor up to the sum of
| ||||||
22 | $5,000,000 from the General Revenue Fund to the School | ||||||
23 | Infrastructure Fund.
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24 | (b) Subject to the transfer provisions set forth below, |
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1 | money in the
School Infrastructure Fund shall, if and when the | ||||||
2 | State of Illinois incurs
any bonded indebtedness for the | ||||||
3 | construction of school improvements under
the School | ||||||
4 | Construction Law, be set aside and used for the purpose of
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5 | paying and discharging annually the principal and interest on | ||||||
6 | that bonded
indebtedness then due and payable, and for no other | ||||||
7 | purpose.
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8 | In addition to other transfers to the General Obligation | ||||||
9 | Bond Retirement and
Interest Fund made pursuant to Section 15 | ||||||
10 | of the General Obligation Bond Act,
upon each delivery of bonds | ||||||
11 | issued for construction of school improvements
under the School | ||||||
12 | Construction Law, the State Comptroller shall
compute and | ||||||
13 | certify to the State Treasurer the total amount of principal | ||||||
14 | of,
interest on, and premium, if any, on such bonds during the | ||||||
15 | then current and
each succeeding fiscal year.
With respect to | ||||||
16 | the interest payable on variable rate bonds, such
| ||||||
17 | certifications shall be calculated at the maximum rate of | ||||||
18 | interest that
may be payable during the fiscal year, after | ||||||
19 | taking into account any credits
permitted in the related | ||||||
20 | indenture or other instrument against the amount of
such | ||||||
21 | interest required to be appropriated for that period.
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22 | On or before the last day of each month, the State | ||||||
23 | Treasurer and State
Comptroller shall transfer from the School | ||||||
24 | Infrastructure Fund to the General
Obligation Bond Retirement | ||||||
25 | and Interest Fund an amount sufficient to pay the
aggregate of | ||||||
26 | the principal of, interest on, and premium, if any, on the | ||||||
27 | bonds
payable on their next payment date, divided by the number | ||||||
28 | of monthly transfers
occurring between the last previous | ||||||
29 | payment date (or the delivery date if no
payment date has yet | ||||||
30 | occurred) and the next succeeding payment date.
Interest | ||||||
31 | payable on variable rate bonds shall be calculated at the | ||||||
32 | maximum
rate of interest that may be payable for the relevant | ||||||
33 | period, after taking into
account any credits permitted in the | ||||||
34 | related indenture or other instrument
against the amount of |
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1 | such interest required to be appropriated for that
period.
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2 | Interest for which moneys have already been deposited into the | ||||||
3 | capitalized
interest account within the General Obligation | ||||||
4 | Bond Retirement and Interest
Fund shall not be included in the | ||||||
5 | calculation of the amounts to be transferred
under this | ||||||
6 | subsection.
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7 | (c) The surplus, if any, in the School Infrastructure Fund | ||||||
8 | after the
payment of principal and interest on that bonded | ||||||
9 | indebtedness then annually
due shall, subject to | ||||||
10 | appropriation, be used as follows:
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11 | First - to make 3 payments to the School Technology | ||||||
12 | Revolving Loan Fund as
follows:
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13 | Transfer of $30,000,000 in fiscal year 1999;
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14 | Transfer of $20,000,000 in fiscal year 2000; and
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15 | Transfer of $10,000,000 in fiscal year 2001.
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16 | Second - to pay the expenses of the State Board of | ||||||
17 | Education and the Capital
Development Board in administering | ||||||
18 | programs under the School Construction
Law, the total expenses | ||||||
19 | not to exceed $1,200,000 in any
fiscal year.
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20 | Third - to pay any amounts due for grants for school | ||||||
21 | construction projects
and debt service under the School | ||||||
22 | Construction Law.
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23 | Fourth - to pay any amounts due for grants for school | ||||||
24 | maintenance projects
under the School Construction Law.
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25 | (Source: P.A. 92-11, eff.
6-11-01; 92-600, eff. 6-28-02; 93-9, | ||||||
26 | eff. 6-3-03.)
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27 | Section 5. The Use Tax Act is amended by changing Sections | ||||||
28 | 2, 3, and 3-25 as follows:
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29 | (35 ILCS 105/2) (from Ch. 120, par. 439.2)
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30 | Sec. 2. "Use" means the exercise by any person of any right | ||||||
31 | or power over
tangible personal property incident to the | ||||||
32 | ownership of that property,
except that it does not include the |
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1 | sale of such property in any form as
tangible personal property | ||||||
2 | in the regular course of business to the extent
that such | ||||||
3 | property is not first subjected to a use for which it was
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4 | purchased, and does not include the use of such property by its | ||||||
5 | owner for
demonstration purposes: Provided that the property | ||||||
6 | purchased is deemed to
be purchased for the purpose of resale, | ||||||
7 | despite first being used, to the
extent to which it is resold | ||||||
8 | as an ingredient of an intentionally produced
product or | ||||||
9 | by-product of manufacturing. "Use" does not mean the | ||||||
10 | demonstration
use or interim use of tangible personal property | ||||||
11 | by a retailer before he sells
that tangible personal property. | ||||||
12 | For watercraft or aircraft, if the period of
demonstration use | ||||||
13 | or interim use by the retailer exceeds 18 months,
the retailer
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14 | shall pay on the retailers' original cost price the tax imposed | ||||||
15 | by this Act,
and no credit for that tax is permitted if the | ||||||
16 | watercraft or aircraft is
subsequently sold by the retailer. | ||||||
17 | "Use" does not mean the physical
incorporation of tangible | ||||||
18 | personal property, to the extent not first subjected
to a use | ||||||
19 | for which it was purchased, as an ingredient or constituent, | ||||||
20 | into
other tangible personal property (a) which is sold in the | ||||||
21 | regular course of
business or (b) which the person | ||||||
22 | incorporating such ingredient or constituent
therein has | ||||||
23 | undertaken at the time of such purchase to cause to be | ||||||
24 | transported
in interstate commerce to destinations outside the | ||||||
25 | State of Illinois: Provided
that the property purchased is | ||||||
26 | deemed to be purchased for the purpose of
resale, despite first | ||||||
27 | being used, to the extent to which it is resold as an
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28 | ingredient of an intentionally produced product or by-product | ||||||
29 | of manufacturing.
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30 | "Watercraft" means a Class 2, Class 3, or Class 4 | ||||||
31 | watercraft as defined in
Section 3-2 of the Boat Registration | ||||||
32 | and Safety Act, a personal watercraft, or
any boat equipped | ||||||
33 | with an inboard motor.
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34 | "Purchase at retail" means the acquisition of the ownership |
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1 | of or title
to tangible personal property through a sale at | ||||||
2 | retail.
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3 | "Purchaser" means anyone who, through a sale at retail, | ||||||
4 | acquires the
ownership of tangible personal property for a | ||||||
5 | valuable consideration.
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6 | "Sale at retail" means any transfer of the ownership of or | ||||||
7 | title to
tangible personal property to a purchaser, for the | ||||||
8 | purpose of use, and not
for the purpose of resale in any form | ||||||
9 | as tangible personal property to the
extent not first subjected | ||||||
10 | to a use for which it was purchased, for a
valuable | ||||||
11 | consideration: Provided that the property purchased is deemed | ||||||
12 | to
be purchased for the purpose of resale, despite first being | ||||||
13 | used, to the
extent to which it is resold as an ingredient of | ||||||
14 | an intentionally produced
product or by-product of | ||||||
15 | manufacturing. For this purpose, slag produced as
an incident | ||||||
16 | to manufacturing pig iron or steel and sold is considered to be
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17 | an intentionally produced by-product of manufacturing. "Sale | ||||||
18 | at retail"
includes any such transfer made for resale unless | ||||||
19 | made in compliance with
Section 2c of the Retailers' Occupation | ||||||
20 | Tax Act, as incorporated by
reference into Section 12 of this | ||||||
21 | Act. Transactions whereby the possession
of the property is | ||||||
22 | transferred but the seller retains the title as security
for | ||||||
23 | payment of the selling price are sales.
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24 | "Sale at retail" shall also be construed to include any | ||||||
25 | Illinois
florist's sales transaction in which the purchase | ||||||
26 | order is received in
Illinois by a florist and the sale is for | ||||||
27 | use or consumption, but the
Illinois florist has a florist in | ||||||
28 | another state deliver the property to the
purchaser or the | ||||||
29 | purchaser's donee in such other state.
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30 | Nonreusable tangible personal property that is used by | ||||||
31 | persons engaged in
the business of operating a restaurant, | ||||||
32 | cafeteria, or drive-in is a sale for
resale when it is | ||||||
33 | transferred to customers in the ordinary course of business
as | ||||||
34 | part of the sale of food or beverages and is used to deliver, |
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1 | package, or
consume food or beverages, regardless of where | ||||||
2 | consumption of the food or
beverages occurs. Examples of those | ||||||
3 | items include, but are not limited to
nonreusable, paper and | ||||||
4 | plastic cups, plates, baskets, boxes, sleeves, buckets
or other | ||||||
5 | containers, utensils, straws, placemats, napkins, doggie bags, | ||||||
6 | and
wrapping or packaging
materials that are transferred to | ||||||
7 | customers as part of the sale of food or
beverages in the | ||||||
8 | ordinary course of business.
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9 | The purchase, employment and transfer of such tangible | ||||||
10 | personal property
as newsprint and ink for the primary purpose | ||||||
11 | of conveying news (with or
without other information) is not a | ||||||
12 | purchase, use or sale of tangible
personal property.
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13 | Beginning July 1, 2004, "sale at retail" includes licenses | ||||||
14 | of prewritten computer software and any other transfer, for | ||||||
15 | consideration, of the possession or right to use prewritten | ||||||
16 | computer software, no matter how the transaction is | ||||||
17 | characterized by the parties.
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18 | "Selling price" means the consideration for a sale valued | ||||||
19 | in money
whether received in money or otherwise, including | ||||||
20 | cash, credits, property
other than as hereinafter provided, and | ||||||
21 | services, but not including the
value of or credit given for | ||||||
22 | traded-in tangible personal property where the
item that is | ||||||
23 | traded-in is of like kind and character as that which is being
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24 | sold, and shall be determined without any deduction on account | ||||||
25 | of the cost
of the property sold, the cost of materials used, | ||||||
26 | labor or service cost or
any other expense whatsoever, but does | ||||||
27 | not include interest or finance
charges which appear as | ||||||
28 | separate items on the bill of sale or sales
contract nor | ||||||
29 | charges that are added to prices by sellers on account of the
| ||||||
30 | seller's tax liability under the "Retailers' Occupation Tax | ||||||
31 | Act", or on
account of the seller's duty to collect, from the | ||||||
32 | purchaser, the tax that
is imposed by this Act, or on account | ||||||
33 | of the seller's tax liability under
Section 8-11-1 of the | ||||||
34 | Illinois Municipal Code, as heretofore and hereafter
amended, |
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1 | or on account of the seller's tax liability under the "County
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2 | Retailers' Occupation Tax Act". Effective December 1, 1985, | ||||||
3 | "selling price"
shall include charges that are added to prices | ||||||
4 | by sellers on account of the
seller's tax liability under the | ||||||
5 | Cigarette Tax Act, on account of the seller's
duty to collect, | ||||||
6 | from the purchaser, the tax imposed under the Cigarette Use
Tax | ||||||
7 | Act, and on account of the seller's duty to collect, from the | ||||||
8 | purchaser,
any cigarette tax imposed by a home rule unit.
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9 | The phrase "like kind and character" shall be liberally | ||||||
10 | construed
(including but not limited to any form of motor | ||||||
11 | vehicle for any form of
motor vehicle, or any kind of farm or | ||||||
12 | agricultural implement for any other
kind of farm or | ||||||
13 | agricultural implement), while not including a kind of item
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14 | which, if sold at retail by that retailer, would be exempt from | ||||||
15 | retailers'
occupation tax and use tax as an isolated or | ||||||
16 | occasional sale.
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17 | "Department" means the Department of Revenue.
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18 | "Person" means any natural individual, firm, partnership, | ||||||
19 | association,
joint stock company, joint adventure, public or | ||||||
20 | private corporation, limited
liability company, or a
receiver, | ||||||
21 | executor, trustee, guardian or other representative appointed
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22 | by order of any court.
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23 | "Retailer" means and includes every person engaged in the | ||||||
24 | business of
making sales at retail as defined in this Section.
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25 | A person who holds himself or herself out as being engaged | ||||||
26 | (or who habitually
engages) in selling tangible personal | ||||||
27 | property at retail is a retailer
hereunder with respect to such | ||||||
28 | sales (and not primarily in a service
occupation) | ||||||
29 | notwithstanding the fact that such person designs and produces
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30 | such tangible personal property on special order for the | ||||||
31 | purchaser and in
such a way as to render the property of value | ||||||
32 | only to such purchaser, if
such tangible personal property so | ||||||
33 | produced on special order serves
substantially the same | ||||||
34 | function as stock or standard items of tangible
personal |
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1 | property that are sold at retail.
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2 | A person whose activities are organized and conducted | ||||||
3 | primarily as a
not-for-profit service enterprise, and who | ||||||
4 | engages in selling tangible
personal property at retail | ||||||
5 | (whether to the public or merely to members and
their guests) | ||||||
6 | is a retailer with respect to such transactions, excepting
only | ||||||
7 | a person organized and operated exclusively for charitable, | ||||||
8 | religious
or educational purposes either (1), to the extent of | ||||||
9 | sales by such person
to its members, students, patients or | ||||||
10 | inmates of tangible personal property
to be used primarily for | ||||||
11 | the purposes of such person, or (2), to the extent
of sales by | ||||||
12 | such person of tangible personal property which is not sold or
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13 | offered for sale by persons organized for profit. The selling | ||||||
14 | of school
books and school supplies by schools at retail to | ||||||
15 | students is not
"primarily for the purposes of" the school | ||||||
16 | which does such selling. This
paragraph does not apply to nor | ||||||
17 | subject to taxation occasional dinners,
social or similar | ||||||
18 | activities of a person organized and operated exclusively
for | ||||||
19 | charitable, religious or educational purposes, whether or not | ||||||
20 | such
activities are open to the public.
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21 | A person who is the recipient of a grant or contract under | ||||||
22 | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | ||||||
23 | serves meals to
participants in the federal Nutrition Program | ||||||
24 | for the Elderly in return for
contributions established in | ||||||
25 | amount by the individual participant pursuant
to a schedule of | ||||||
26 | suggested fees as provided for in the federal Act is not a
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27 | retailer under this Act with respect to such transactions.
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28 | Persons who engage in the business of transferring tangible | ||||||
29 | personal
property upon the redemption of trading stamps are | ||||||
30 | retailers hereunder when
engaged in such business.
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31 | The isolated or occasional sale of tangible personal | ||||||
32 | property at retail
by a person who does not hold himself out as | ||||||
33 | being engaged (or who does not
habitually engage) in selling | ||||||
34 | such tangible personal property at retail or
a sale through a |
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1 | bulk vending machine does not make such person a retailer
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2 | hereunder. However, any person who is engaged in a business | ||||||
3 | which is not
subject to the tax imposed by the "Retailers' | ||||||
4 | Occupation Tax Act" because
of involving the sale of or a | ||||||
5 | contract to sell real estate or a
construction contract to | ||||||
6 | improve real estate, but who, in the course of
conducting such | ||||||
7 | business, transfers tangible personal property to users or
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8 | consumers in the finished form in which it was purchased, and | ||||||
9 | which does
not become real estate, under any provision of a | ||||||
10 | construction contract or
real estate sale or real estate sales | ||||||
11 | agreement entered into with some
other person arising out of or | ||||||
12 | because of such nontaxable business, is a
retailer to the | ||||||
13 | extent of the value of the tangible personal property so
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14 | transferred. If, in such transaction, a separate charge is made | ||||||
15 | for the
tangible personal property so transferred, the value of | ||||||
16 | such property, for
the purposes of this Act, is the amount so | ||||||
17 | separately charged, but not less
than the cost of such property | ||||||
18 | to the transferor; if no separate charge is
made, the value of | ||||||
19 | such property, for the purposes of this Act, is the cost
to the | ||||||
20 | transferor of such tangible personal property.
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21 | "Retailer maintaining a place of business in this State", | ||||||
22 | or any like
term, means and includes any of the following | ||||||
23 | retailers:
| ||||||
24 | 1. A retailer having or maintaining within this State, | ||||||
25 | directly or by
a subsidiary, an office, distribution house, | ||||||
26 | sales house, warehouse or other
place of business, or any | ||||||
27 | agent or other representative operating within this
State | ||||||
28 | under the authority of the retailer or its subsidiary, | ||||||
29 | irrespective of
whether such place of business or agent or | ||||||
30 | other representative is located here
permanently or | ||||||
31 | temporarily, or whether such retailer or subsidiary is | ||||||
32 | licensed
to do business in this State. However, the | ||||||
33 | ownership of property that is
located at the premises of a | ||||||
34 | printer with which the retailer has contracted for
printing |
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1 | and that consists of the final printed product, property | ||||||
2 | that becomes
a part of the final printed product, or copy | ||||||
3 | from which the printed product is
produced shall not result | ||||||
4 | in the retailer being deemed to have or maintain an
office, | ||||||
5 | distribution house, sales house, warehouse, or other place | ||||||
6 | of business
within this State.
| ||||||
7 | 2. A retailer soliciting orders for tangible personal | ||||||
8 | property by
means of a telecommunication or television | ||||||
9 | shopping system (which utilizes toll
free numbers) which is | ||||||
10 | intended by the retailer to be broadcast by cable
| ||||||
11 | television or other means of broadcasting, to consumers | ||||||
12 | located in this State.
| ||||||
13 | 3. A retailer, pursuant to a contract with a | ||||||
14 | broadcaster or publisher
located in this State, soliciting | ||||||
15 | orders for tangible personal property by
means of | ||||||
16 | advertising which is disseminated primarily to consumers | ||||||
17 | located in
this State and only secondarily to bordering | ||||||
18 | jurisdictions.
| ||||||
19 | 4. A retailer soliciting orders for tangible personal | ||||||
20 | property by mail
if the solicitations are substantial and | ||||||
21 | recurring and if the retailer benefits
from any banking, | ||||||
22 | financing, debt collection, telecommunication, or | ||||||
23 | marketing
activities occurring in this State or benefits | ||||||
24 | from the location in this State
of authorized installation, | ||||||
25 | servicing, or repair facilities.
| ||||||
26 | 5. A retailer that is owned or controlled by the same | ||||||
27 | interests that own
or control any retailer engaging in | ||||||
28 | business in the same or similar line of
business in this | ||||||
29 | State.
| ||||||
30 | 6. A retailer having a franchisee or licensee operating | ||||||
31 | under its trade
name if the franchisee or licensee is | ||||||
32 | required to collect the tax under this
Section.
| ||||||
33 | 7. A retailer, pursuant to a contract with a cable | ||||||
34 | television operator
located in this State, soliciting |
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| |||||||
1 | orders for tangible personal property by
means of | ||||||
2 | advertising which is transmitted or distributed over a | ||||||
3 | cable
television system in this State.
| ||||||
4 | 8. A retailer engaging in activities in Illinois, which | ||||||
5 | activities in
the state in which the retail business | ||||||
6 | engaging in such activities is located
would constitute | ||||||
7 | maintaining a place of business in that state.
| ||||||
8 | "Bulk vending machine" means a vending machine,
containing | ||||||
9 | unsorted confections, nuts, toys, or other items designed
| ||||||
10 | primarily to be used or played with by children
which, when a | ||||||
11 | coin or coins of a denomination not larger than $0.50 are | ||||||
12 | inserted, are dispensed in equal portions, at random and
| ||||||
13 | without selection by the customer.
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14 | (Source: P.A. 92-213, eff. 1-1-02.)
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15 | (35 ILCS 105/3) (from Ch. 120, par. 439.3)
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16 | Sec. 3. Tax imposed. A tax is imposed upon the privilege of | ||||||
17 | using in
this State tangible personal property purchased at | ||||||
18 | retail from a
retailer, including computer software, and
| ||||||
19 | including photographs, negatives, and positives that are the | ||||||
20 | product of
photoprocessing, but not including products of | ||||||
21 | photoprocessing produced for
use in motion pictures for | ||||||
22 | commercial exhibition.
Beginning January 1, 2001, prepaid | ||||||
23 | telephone calling arrangements shall be
considered tangible | ||||||
24 | personal property subject to the tax imposed under this Act
| ||||||
25 | regardless of the form in which those arrangements may be | ||||||
26 | embodied,
transmitted, or fixed by any method now known or | ||||||
27 | hereafter developed. Beginning July 1, 2004, computer software | ||||||
28 | subject to tax under this Act includes licenses of prewritten | ||||||
29 | computer software and any other transfer, for consideration, of | ||||||
30 | the possession or right to use prewritten computer software, no | ||||||
31 | matter how the transaction is characterized by the parties.
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32 | (Source: P.A. 91-51, eff. 6-30-99; 91-870, eff. 6-22-00.)
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1 | (35 ILCS 105/3-25) (from Ch. 120, par. 439.3-25)
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2 | Sec. 3-25. Computer software ; prewritten computer | ||||||
3 | software .
| ||||||
4 | (a) For the purposes of this Act, "computer
software" means | ||||||
5 | a set of statements, data,
or instructions to be used directly | ||||||
6 | or indirectly in a computer in order to
bring about a certain | ||||||
7 | result in any form in which those statements, data, or
| ||||||
8 | instructions may be embodied, transmitted, or fixed, by any | ||||||
9 | method now known
or hereafter developed, regardless of whether | ||||||
10 | the statements, data, or
instructions are capable of being | ||||||
11 | perceived by or communicated to humans,
and includes prewritten | ||||||
12 | or canned software that is held for repeated sale
or lease, and | ||||||
13 | all associated documentation and materials, if any, whether
| ||||||
14 | contained on magnetic tapes, discs, cards, or other devices or | ||||||
15 | media, but
does not include (i) until July 1, 2004, software | ||||||
16 | that is adapted to specific individualized
requirements of a | ||||||
17 | purchaser, custom-made and modified software designed for
a | ||||||
18 | particular or limited use by a purchaser, or (ii) software used | ||||||
19 | to operate
exempt machinery and equipment used in the process | ||||||
20 | of manufacturing or
assembling tangible personal property for | ||||||
21 | wholesale or retail sale or
lease.
| ||||||
22 | (b) Beginning on July 1, 2004, "prewritten computer | ||||||
23 | software" means computer software, including upgrades, that is | ||||||
24 | not designed and developed by the author or other creator to | ||||||
25 | the specifications of a specific purchaser. The combining of 2 | ||||||
26 | or more "prewritten computer software" programs or prewritten | ||||||
27 | portions thereof does not cause the combination to be other | ||||||
28 | than "prewritten computer software". "Prewritten computer | ||||||
29 | software" includes software designed and developed by the | ||||||
30 | author or other creator to the specifications of a specific | ||||||
31 | purchaser when it is sold to a person other than the specific | ||||||
32 | purchaser. When a person modifies or enhances computer software | ||||||
33 | of which the person is not the author or creator, the person | ||||||
34 | shall be deemed to be the author or creator only of that |
| |||||||
| |||||||
1 | person's modifications or enhancements. "Prewritten computer | ||||||
2 | software" or a prewritten portion thereof that is modified or | ||||||
3 | enhanced to any degree, when the modification or enhancement | ||||||
4 | according to Department rules is designed and developed to the | ||||||
5 | specifications of a specific purchaser, remains "prewritten | ||||||
6 | computer software", except that when there is a reasonable | ||||||
7 | separately stated charge or an invoice or other statement of | ||||||
8 | the price given to the purchaser for the modification or | ||||||
9 | enhancement, the modification or enhancement does not | ||||||
10 | constitute "prewritten computer software".
| ||||||
11 | For the purposes of this Act, computer software shall be | ||||||
12 | considered to be
tangible personal property.
| ||||||
13 | (Source: P.A. 91-51, eff. 6-30-99.)
| ||||||
14 | Section 10. The Service Use Tax Act is amended by changing | ||||||
15 | Sections 2 and 3-25 as follows:
| ||||||
16 | (35 ILCS 110/2) (from Ch. 120, par. 439.32)
| ||||||
17 | Sec. 2. "Use" means the exercise by any person of any right | ||||||
18 | or power
over tangible personal property incident to the | ||||||
19 | ownership of that
property, but does not include the sale or | ||||||
20 | use for demonstration by him
of that property in any form as | ||||||
21 | tangible personal property in the
regular course of business.
| ||||||
22 | "Use" does not mean the interim
use of
tangible personal | ||||||
23 | property nor the physical incorporation of tangible
personal | ||||||
24 | property, as an ingredient or constituent, into other tangible
| ||||||
25 | personal property, (a) which is sold in the regular course of | ||||||
26 | business
or (b) which the person incorporating such ingredient | ||||||
27 | or constituent
therein has undertaken at the time of such | ||||||
28 | purchase to cause to be
transported in interstate commerce to | ||||||
29 | destinations outside the State of
Illinois. Beginning July 1, | ||||||
30 | 2004, the use of licenses of prewritten computer software and | ||||||
31 | any other transfer, for consideration, of the possession or | ||||||
32 | right to use prewritten computer software, no matter how the |
| |||||||
| |||||||
1 | transaction is characterized by the parties, is considered a | ||||||
2 | use of tangible personal property under this Act.
| ||||||
3 | "Purchased from a serviceman" means the acquisition of the | ||||||
4 | ownership
of, or title to, tangible personal property through a | ||||||
5 | sale of service.
| ||||||
6 | "Purchaser" means any person who, through a sale of | ||||||
7 | service, acquires
the ownership of, or title to, any tangible | ||||||
8 | personal property.
| ||||||
9 | "Cost price" means the consideration paid by the serviceman | ||||||
10 | for a
purchase valued in money, whether paid in money or | ||||||
11 | otherwise, including
cash, credits and services, and shall be | ||||||
12 | determined without any
deduction on account of the supplier's | ||||||
13 | cost of the property sold or on
account of any other expense | ||||||
14 | incurred by the supplier. When a serviceman
contracts out part | ||||||
15 | or all of the services required in his sale of service,
it | ||||||
16 | shall be presumed that the cost price to the serviceman of the | ||||||
17 | property
transferred to him or her by his or her subcontractor | ||||||
18 | is equal to 50% of
the subcontractor's charges to the | ||||||
19 | serviceman in the absence of proof of
the consideration paid by | ||||||
20 | the subcontractor for the purchase of such property.
| ||||||
21 | "Selling price" means the consideration for a sale valued | ||||||
22 | in money
whether received in money or otherwise, including | ||||||
23 | cash, credits and
service, and shall be determined without any | ||||||
24 | deduction on account of the
serviceman's cost of the property | ||||||
25 | sold, the cost of materials used,
labor or service cost or any | ||||||
26 | other expense whatsoever, but does not
include interest or | ||||||
27 | finance charges which appear as separate items on
the bill of | ||||||
28 | sale or sales contract nor charges that are added to prices
by | ||||||
29 | sellers on account of the seller's duty to collect, from the
| ||||||
30 | purchaser, the tax that is imposed by this Act.
| ||||||
31 | "Department" means the Department of Revenue.
| ||||||
32 | "Person" means any natural individual, firm, partnership,
| ||||||
33 | association, joint stock company, joint venture, public or | ||||||
34 | private
corporation, limited liability company, and any |
| |||||||
| |||||||
1 | receiver, executor, trustee,
guardian or other representative | ||||||
2 | appointed by order of any court.
| ||||||
3 | "Sale of service" means any transaction except:
| ||||||
4 | (1) a retail sale of tangible personal property taxable | ||||||
5 | under the
Retailers' Occupation Tax Act or under the Use | ||||||
6 | Tax Act.
| ||||||
7 | (2) a sale of tangible personal property for the | ||||||
8 | purpose of resale
made in compliance with Section 2c of the | ||||||
9 | Retailers' Occupation Tax Act.
| ||||||
10 | (3) except as hereinafter provided, a sale or transfer | ||||||
11 | of tangible
personal property as an incident to the | ||||||
12 | rendering of service for or by
any governmental body, or | ||||||
13 | for or by any corporation, society,
association, | ||||||
14 | foundation or institution organized and operated
| ||||||
15 | exclusively for charitable, religious or educational | ||||||
16 | purposes or any
not-for-profit corporation, society, | ||||||
17 | association, foundation,
institution or organization which | ||||||
18 | has no compensated officers or
employees and which is | ||||||
19 | organized and operated primarily for the
recreation of | ||||||
20 | persons 55 years of age or older. A limited liability | ||||||
21 | company
may qualify for the exemption under this paragraph | ||||||
22 | only if the limited
liability company is organized and | ||||||
23 | operated exclusively for educational
purposes.
| ||||||
24 | (4) a sale or transfer of tangible personal
property as | ||||||
25 | an incident to the
rendering of service for interstate | ||||||
26 | carriers for hire for use as rolling stock
moving in | ||||||
27 | interstate commerce or by lessors under a lease of one year | ||||||
28 | or
longer, executed or in effect at the time of purchase of | ||||||
29 | personal property, to
interstate carriers for hire for use | ||||||
30 | as rolling stock moving in interstate
commerce so long as | ||||||
31 | so used by such interstate carriers for hire, and equipment
| ||||||
32 | operated by a telecommunications provider, licensed as a | ||||||
33 | common carrier by the
Federal Communications Commission, | ||||||
34 | which is permanently installed in or affixed
to aircraft |
| |||||||
| |||||||
1 | moving in interstate commerce.
| ||||||
2 | (4a) a sale or transfer of tangible personal
property | ||||||
3 | as an incident
to the rendering of service for owners, | ||||||
4 | lessors, or shippers of tangible
personal property which is | ||||||
5 | utilized by interstate carriers for hire for
use as rolling | ||||||
6 | stock moving in interstate commerce so long as so used by
| ||||||
7 | interstate carriers for hire, and equipment operated by a
| ||||||
8 | telecommunications provider, licensed as a common carrier | ||||||
9 | by the Federal
Communications Commission, which is | ||||||
10 | permanently installed in or affixed to
aircraft moving in | ||||||
11 | interstate commerce.
| ||||||
12 | (4a-5) on and after July 1, 2003, a sale or transfer of | ||||||
13 | a motor vehicle
of
the
second division with a gross vehicle | ||||||
14 | weight in excess of 8,000 pounds as an
incident to the | ||||||
15 | rendering of service if that motor
vehicle is subject
to | ||||||
16 | the commercial distribution fee imposed under Section | ||||||
17 | 3-815.1 of the
Illinois Vehicle
Code. This exemption | ||||||
18 | applies to repair and replacement parts added after the
| ||||||
19 | initial
purchase of such a motor vehicle if that motor | ||||||
20 | vehicle is used in a manner that
would
qualify for the | ||||||
21 | rolling stock exemption otherwise provided for in this Act.
| ||||||
22 | (5) a sale or transfer of machinery and equipment used | ||||||
23 | primarily in the
process of the manufacturing or | ||||||
24 | assembling, either in an existing, an expanded
or a new | ||||||
25 | manufacturing facility, of tangible personal property for | ||||||
26 | wholesale or
retail sale or lease, whether such sale or | ||||||
27 | lease is made directly by the
manufacturer or by some other | ||||||
28 | person, whether the materials used in the process
are owned | ||||||
29 | by the manufacturer or some other person, or whether such | ||||||
30 | sale or
lease is made apart from or as an incident to the | ||||||
31 | seller's engaging in a
service occupation and the | ||||||
32 | applicable tax is a Service Use Tax or Service
Occupation | ||||||
33 | Tax, rather than Use Tax or Retailers' Occupation Tax.
| ||||||
34 | (5a) the repairing, reconditioning or remodeling, for |
| |||||||
| |||||||
1 | a
common carrier by rail, of tangible personal property | ||||||
2 | which belongs to such
carrier for hire, and as to which | ||||||
3 | such carrier receives the physical possession
of the | ||||||
4 | repaired, reconditioned or remodeled item of tangible | ||||||
5 | personal property
in Illinois, and which such carrier | ||||||
6 | transports, or shares with another common
carrier in the | ||||||
7 | transportation of such property, out of Illinois on a | ||||||
8 | standard
uniform bill of lading showing the person who | ||||||
9 | repaired, reconditioned or
remodeled the property to a | ||||||
10 | destination outside Illinois, for use outside
Illinois.
| ||||||
11 | (5b) a sale or transfer of tangible personal property | ||||||
12 | which is produced by
the seller thereof on special order in | ||||||
13 | such a way as to have made the
applicable tax the Service | ||||||
14 | Occupation Tax or the Service Use Tax, rather than
the | ||||||
15 | Retailers' Occupation Tax or the Use Tax, for an interstate | ||||||
16 | carrier by rail
which receives the physical possession of | ||||||
17 | such property in Illinois, and which
transports such | ||||||
18 | property, 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 seller of the | ||||||
21 | property as the shipper or consignor of such
property to a | ||||||
22 | destination outside Illinois, for use outside Illinois.
| ||||||
23 | (6) until July 1, 2003, a sale or transfer of | ||||||
24 | distillation machinery
and equipment, sold
as a unit or kit | ||||||
25 | and assembled or installed by the retailer, which
machinery | ||||||
26 | and equipment is certified by the user to be used only for | ||||||
27 | the
production of ethyl alcohol that will be used for | ||||||
28 | consumption as motor fuel
or as a component of motor fuel | ||||||
29 | for the personal use of such user and not
subject to sale | ||||||
30 | or resale.
| ||||||
31 | (7) at the election of any serviceman not required to | ||||||
32 | be
otherwise registered as a retailer under Section 2a of | ||||||
33 | the Retailers'
Occupation Tax Act, made for each fiscal | ||||||
34 | year sales
of service in which the aggregate annual cost |
| |||||||
| |||||||
1 | price of tangible
personal property transferred as an | ||||||
2 | incident to the sales of service is
less than 35%, or 75% | ||||||
3 | in the case of servicemen transferring prescription
drugs | ||||||
4 | or servicemen engaged in graphic arts production, of the | ||||||
5 | aggregate
annual total gross receipts from all sales of | ||||||
6 | service. The purchase of
such tangible personal property by | ||||||
7 | the serviceman shall be subject to tax
under the Retailers' | ||||||
8 | Occupation Tax Act and the Use Tax Act.
However, if a
| ||||||
9 | primary serviceman who has made the election described in | ||||||
10 | this paragraph
subcontracts service work to a secondary | ||||||
11 | serviceman who has also made the
election described in this | ||||||
12 | paragraph, the primary serviceman does not
incur a Use Tax | ||||||
13 | liability if the secondary serviceman (i) has paid or will | ||||||
14 | pay
Use
Tax on his or her cost price of any tangible | ||||||
15 | personal property transferred
to the primary serviceman | ||||||
16 | and (ii) certifies that fact in writing to the
primary
| ||||||
17 | serviceman.
| ||||||
18 | Tangible personal property transferred incident to the | ||||||
19 | completion of a
maintenance agreement is exempt from the tax | ||||||
20 | imposed pursuant to this Act.
| ||||||
21 | Beginning July 1, 2004, prewritten computer software that | ||||||
22 | is modified or enhanced, when that enhancement or modification | ||||||
23 | according to Department rules is designed and developed to the | ||||||
24 | specifications of a specific purchaser, is exempt from the tax | ||||||
25 | imposed under this Act and the transfer of that modified or | ||||||
26 | enhanced computer software is subject to tax under the | ||||||
27 | Retailers' Occupation Tax Act and the Use Tax Act.
| ||||||
28 | Exemption (5) also includes machinery and equipment used in | ||||||
29 | the general
maintenance or repair of such exempt machinery and | ||||||
30 | equipment or for in-house
manufacture of exempt machinery and | ||||||
31 | equipment. For the purposes of exemption
(5), each of these | ||||||
32 | terms shall have the following meanings: (1) "manufacturing
| ||||||
33 | process" shall mean the production of any article of tangible | ||||||
34 | personal
property, whether such article is a finished product |
| |||||||
| |||||||
1 | or an article for use in
the process of manufacturing or | ||||||
2 | assembling a different article of tangible
personal property, | ||||||
3 | by procedures commonly regarded as manufacturing,
processing, | ||||||
4 | fabricating, or refining which changes some existing
material | ||||||
5 | or materials into a material with a different form, use or
| ||||||
6 | name. In relation to a recognized integrated business composed | ||||||
7 | of a
series of operations which collectively constitute | ||||||
8 | manufacturing, or
individually constitute manufacturing | ||||||
9 | operations, the manufacturing
process shall be deemed to | ||||||
10 | commence with the first operation or stage of
production in the | ||||||
11 | series, and shall not be deemed to end until the
completion of | ||||||
12 | the final product in the last operation or stage of
production | ||||||
13 | in the series; and further, for purposes of exemption (5),
| ||||||
14 | photoprocessing is deemed to be a manufacturing process of | ||||||
15 | tangible
personal property for wholesale or retail sale; (2) | ||||||
16 | "assembling process" shall
mean the production of any article | ||||||
17 | of tangible personal property, whether such
article is a | ||||||
18 | finished product or an article for use in the process of
| ||||||
19 | manufacturing or assembling a different article of tangible | ||||||
20 | personal
property, by the combination of existing materials in | ||||||
21 | a manner commonly
regarded as assembling which results in a | ||||||
22 | material of a different form,
use or name; (3) "machinery" | ||||||
23 | shall mean major mechanical machines or
major components of | ||||||
24 | such machines contributing to a manufacturing or
assembling | ||||||
25 | process; and (4) "equipment" shall include any independent
| ||||||
26 | device or tool separate from any machinery but essential to an
| ||||||
27 | integrated manufacturing or assembly process; including | ||||||
28 | computers
used primarily in a manufacturer's computer
assisted | ||||||
29 | design, computer assisted manufacturing (CAD/CAM) system;
or | ||||||
30 | any subunit or assembly comprising a component of any machinery | ||||||
31 | or
auxiliary, adjunct or attachment parts of machinery, such as | ||||||
32 | tools, dies,
jigs, fixtures, patterns and molds; or any parts | ||||||
33 | which require periodic
replacement in the course of normal | ||||||
34 | operation; but shall not include hand
tools.
Equipment includes |
| |||||||
| |||||||
1 | chemicals or chemicals acting as catalysts but only if the
| ||||||
2 | chemicals or chemicals acting as catalysts effect a direct and | ||||||
3 | immediate change
upon a
product being manufactured or assembled | ||||||
4 | for wholesale or retail sale or
lease.
The purchaser of such | ||||||
5 | machinery and equipment who has an active
resale registration | ||||||
6 | number shall furnish such number to the seller at the
time of | ||||||
7 | purchase. The user of such machinery and equipment and tools
| ||||||
8 | without an active resale registration number shall prepare a | ||||||
9 | certificate of
exemption for each transaction stating facts | ||||||
10 | establishing the exemption for
that transaction, which | ||||||
11 | certificate shall be available to the Department
for inspection | ||||||
12 | or audit. The Department shall prescribe the form of the
| ||||||
13 | certificate.
| ||||||
14 | Any informal rulings, opinions or letters issued by the | ||||||
15 | Department in
response to an inquiry or request for any opinion | ||||||
16 | from any person
regarding the coverage and applicability of | ||||||
17 | exemption (5) to specific
devices shall be published, | ||||||
18 | maintained as a public record, and made
available for public | ||||||
19 | inspection and copying. If the informal ruling,
opinion or | ||||||
20 | letter contains trade secrets or other confidential
| ||||||
21 | information, where possible the Department shall delete such | ||||||
22 | information
prior to publication. Whenever such informal | ||||||
23 | rulings, opinions, or
letters contain any policy of general | ||||||
24 | applicability, the Department
shall formulate and adopt such | ||||||
25 | policy as a rule in accordance with the
provisions of the | ||||||
26 | Illinois Administrative Procedure Act.
| ||||||
27 | On and after July 1, 1987, no entity otherwise eligible | ||||||
28 | under exemption
(3) of this Section shall make tax free | ||||||
29 | purchases unless it has an active
exemption identification | ||||||
30 | number issued by the Department.
| ||||||
31 | The purchase, employment and transfer of such tangible | ||||||
32 | personal
property as newsprint and ink for the primary purpose | ||||||
33 | of conveying news
(with or without other information) is not a | ||||||
34 | purchase, use or sale of
service or of tangible personal |
| |||||||
| |||||||
1 | property within the meaning of this Act.
| ||||||
2 | "Serviceman" means any person who is engaged in the | ||||||
3 | occupation of
making sales of service.
| ||||||
4 | "Sale at retail" means "sale at retail" as defined in the | ||||||
5 | Retailers'
Occupation Tax Act.
| ||||||
6 | "Supplier" means any person who makes sales of tangible | ||||||
7 | personal
property to servicemen for the purpose of resale as an | ||||||
8 | incident to a
sale of service.
| ||||||
9 | "Serviceman maintaining a place of business in this State", | ||||||
10 | or any
like term, means and includes any serviceman:
| ||||||
11 | 1. having or maintaining within this State, directly or | ||||||
12 | by a
subsidiary, an office, distribution house, sales | ||||||
13 | house, warehouse or
other place of business, or any agent | ||||||
14 | or other representative operating
within this State under | ||||||
15 | the authority of the serviceman or its
subsidiary, | ||||||
16 | irrespective of whether such place of business or agent or
| ||||||
17 | other representative is located here permanently or | ||||||
18 | temporarily, or
whether such serviceman or subsidiary is | ||||||
19 | licensed to do business in this
State;
| ||||||
20 | 2. soliciting orders for tangible personal property by | ||||||
21 | means of a
telecommunication or television shopping system | ||||||
22 | (which utilizes toll free
numbers) which is intended by the | ||||||
23 | retailer to be broadcast by cable
television or other means | ||||||
24 | of broadcasting, to consumers located in this State;
| ||||||
25 | 3. pursuant to a contract with a broadcaster or | ||||||
26 | publisher located in this
State, soliciting orders for | ||||||
27 | tangible personal property by means of advertising
which is | ||||||
28 | disseminated primarily to consumers located in this State | ||||||
29 | and only
secondarily to bordering jurisdictions;
| ||||||
30 | 4. soliciting orders for tangible personal property by | ||||||
31 | mail if the
solicitations are substantial and recurring and | ||||||
32 | if the retailer benefits
from any banking, financing, debt | ||||||
33 | collection, telecommunication, or
marketing activities | ||||||
34 | occurring in this State or benefits from the location
in |
| |||||||
| |||||||
1 | this State of authorized installation, servicing, or | ||||||
2 | repair facilities;
| ||||||
3 | 5. being owned or controlled by the same interests | ||||||
4 | which own or
control any retailer engaging in business in | ||||||
5 | the same or similar line of
business in this State;
| ||||||
6 | 6. having a franchisee or licensee operating under its | ||||||
7 | trade name if
the franchisee or licensee is required to | ||||||
8 | collect the tax under this Section;
| ||||||
9 | 7. pursuant to a contract with a cable television | ||||||
10 | operator located in
this State, soliciting orders for | ||||||
11 | tangible personal property by means of
advertising which is | ||||||
12 | transmitted or distributed over a cable television
system | ||||||
13 | in this State; or
| ||||||
14 | 8. engaging in activities in Illinois, which | ||||||
15 | activities in the
state in which the supply business | ||||||
16 | engaging in such activities is located
would constitute | ||||||
17 | maintaining a place of business in that state.
| ||||||
18 | (Source: P.A. 92-484, eff. 8-23-01; 93-23, eff. 6-20-03; 93-24, | ||||||
19 | eff.
6-20-03; revised 8-21-03.)
| ||||||
20 | (35 ILCS 110/3-25) (from Ch. 120, par. 439.33-25)
| ||||||
21 | Sec. 3-25. Computer software.
| ||||||
22 | (a) On and before June 30, 2004, for
For the purposes of | ||||||
23 | this Act, "computer
software" means a set of statements, data,
| ||||||
24 | or instructions to be used directly or indirectly in a computer | ||||||
25 | in order to
bring about a certain result in any form in which | ||||||
26 | those statements, data, or
instructions may be embodied, | ||||||
27 | transmitted, or fixed, by any method now known
or hereafter | ||||||
28 | developed, regardless of whether the statements, data, or
| ||||||
29 | instructions are capable of being perceived by or communicated | ||||||
30 | to humans,
and includes prewritten or canned software that is | ||||||
31 | held for repeated sale
or lease, and all associated | ||||||
32 | documentation and materials, if any, whether
contained on | ||||||
33 | magnetic tapes, discs, cards, or other devices or media, but
|
| |||||||
| |||||||
1 | does not include software that is adapted to specific | ||||||
2 | individualized
requirements of a purchaser, custom-made and | ||||||
3 | modified software designed for
a particular or limited use by a | ||||||
4 | purchaser, or software used to operate
exempt machinery and | ||||||
5 | equipment used in the process of manufacturing or
assembling | ||||||
6 | tangible personal property for wholesale or retail sale or
| ||||||
7 | lease.
| ||||||
8 | (b) On and after July 1, 2004, for the purposes of this | ||||||
9 | Act, "computer software" has the same meaning as that term is | ||||||
10 | defined in Section 3-25 of the Use Tax Act.
| ||||||
11 | (c) For the purposes of this Act, computer software shall | ||||||
12 | be considered to be
tangible personal property.
| ||||||
13 | (Source: P.A. 91-51, eff. 6-30-99.)
| ||||||
14 | Section 15. The Service Occupation Tax Act is amended by | ||||||
15 | changing Sections 2 and 3-25 as follows:
| ||||||
16 | (35 ILCS 115/2) (from Ch. 120, par. 439.102)
| ||||||
17 | Sec. 2. "Transfer" means any transfer of the title to | ||||||
18 | property or of
the ownership of property whether or not the | ||||||
19 | transferor retains title as
security for the payment of amounts | ||||||
20 | due him from the transferee. Beginning July 1, 2004, the | ||||||
21 | transfer of licenses of prewritten computer software and any | ||||||
22 | other transfer, for consideration, of the possession or right | ||||||
23 | to use prewritten computer software, no matter how the | ||||||
24 | transaction is characterized by the parties, is considered a | ||||||
25 | transfer of tangible personal property under this Act.
| ||||||
26 | "Cost Price" means the consideration paid by the serviceman | ||||||
27 | for a
purchase valued in money, whether paid in money or | ||||||
28 | otherwise, including
cash, credits and services, and shall be | ||||||
29 | determined without any deduction
on account of the supplier's | ||||||
30 | cost of the property sold or on account of any
other expense | ||||||
31 | incurred by the supplier. When a serviceman contracts out
part | ||||||
32 | or all of the services required in his sale of service, it |
| |||||||
| |||||||
1 | shall be
presumed that the cost price to the serviceman of the | ||||||
2 | property
transferred to him by his or her subcontractor is | ||||||
3 | equal to 50% of the
subcontractor's charges to the serviceman | ||||||
4 | in the absence of proof of the
consideration paid by the | ||||||
5 | subcontractor for the purchase of such
property.
| ||||||
6 | "Department" means the Department of Revenue.
| ||||||
7 | "Person" means any natural individual, firm, partnership, | ||||||
8 | association, joint
stock company, joint venture, public or | ||||||
9 | private corporation, limited liability
company, and any | ||||||
10 | receiver, executor, trustee, guardian or other representative
| ||||||
11 | appointed by order of any court.
| ||||||
12 | "Sale of Service" means any transaction except:
| ||||||
13 | (a) A retail sale of tangible personal property taxable | ||||||
14 | under the Retailers'
Occupation Tax Act or under the Use Tax | ||||||
15 | Act.
| ||||||
16 | (b) A sale of tangible personal property for the purpose of | ||||||
17 | resale made in
compliance with Section 2c of the Retailers' | ||||||
18 | Occupation Tax Act.
| ||||||
19 | (c) Except as hereinafter provided, a sale or transfer of | ||||||
20 | tangible personal
property as an incident to the rendering of | ||||||
21 | service for or by any governmental
body or for or by any | ||||||
22 | corporation, society, association, foundation or
institution | ||||||
23 | organized and operated exclusively for charitable, religious | ||||||
24 | or
educational purposes or any not-for-profit corporation, | ||||||
25 | society, association,
foundation, institution or organization | ||||||
26 | which has no compensated officers or
employees and which is | ||||||
27 | organized and operated primarily for the recreation of
persons | ||||||
28 | 55 years of age or older. A limited liability company may | ||||||
29 | qualify for
the exemption under this paragraph only if the | ||||||
30 | limited liability company is
organized and operated | ||||||
31 | exclusively for educational purposes.
| ||||||
32 | (d) A sale or transfer of tangible personal
property
as an | ||||||
33 | incident to the
rendering of service for interstate carriers | ||||||
34 | for hire for use as rolling stock
moving in interstate commerce |
| |||||||
| |||||||
1 | or lessors under leases of one year or longer,
executed or in | ||||||
2 | effect at the time of purchase, to interstate carriers for hire
| ||||||
3 | for use as rolling stock moving in interstate commerce, and | ||||||
4 | equipment operated
by a telecommunications provider, licensed | ||||||
5 | as a common
carrier by the Federal Communications Commission, | ||||||
6 | which is permanently
installed in or affixed to aircraft moving | ||||||
7 | in interstate commerce.
| ||||||
8 | (d-1) A sale or transfer of tangible personal
property as | ||||||
9 | an incident to
the rendering of service for owners, lessors or | ||||||
10 | shippers of tangible personal
property which is utilized by | ||||||
11 | interstate carriers for hire for use as rolling
stock moving in | ||||||
12 | interstate commerce, and equipment operated
by a | ||||||
13 | telecommunications provider, licensed as a common carrier by | ||||||
14 | the
Federal Communications Commission, which is permanently | ||||||
15 | installed in or
affixed to aircraft moving in interstate | ||||||
16 | commerce.
| ||||||
17 | (d-1.1) On and after July 1, 2003, a sale or transfer of a | ||||||
18 | motor vehicle
of the
second division with a gross vehicle | ||||||
19 | weight in excess of 8,000 pounds as an
incident to the | ||||||
20 | rendering of service if that motor
vehicle is subject
to the | ||||||
21 | commercial distribution fee imposed under Section 3-815.1 of | ||||||
22 | the
Illinois Vehicle
Code. This exemption applies to repair and | ||||||
23 | replacement parts added after the
initial
purchase of such a | ||||||
24 | motor vehicle if that motor vehicle is used in a manner that
| ||||||
25 | would
qualify for the rolling stock exemption otherwise | ||||||
26 | provided for in this Act.
| ||||||
27 | (d-2) The repairing, reconditioning or remodeling, for a | ||||||
28 | common carrier by
rail, of tangible personal property which | ||||||
29 | belongs to such carrier for hire, and
as to which such carrier | ||||||
30 | receives the physical possession of the repaired,
| ||||||
31 | reconditioned or remodeled item of tangible personal property | ||||||
32 | in Illinois, and
which such carrier transports, or shares with | ||||||
33 | another common carrier in the
transportation of such property, | ||||||
34 | out of Illinois on a standard uniform bill of
lading showing |
| |||||||
| |||||||
1 | the person who repaired, reconditioned or remodeled the | ||||||
2 | property
as the shipper or consignor of such property to a | ||||||
3 | destination outside Illinois,
for use outside Illinois.
| ||||||
4 | (d-3) A sale or transfer of tangible personal property | ||||||
5 | which
is produced by the seller thereof on special order in | ||||||
6 | such a way as to have
made the applicable tax the Service | ||||||
7 | Occupation Tax or the Service Use Tax,
rather than the | ||||||
8 | Retailers' Occupation Tax or the Use Tax, for an interstate
| ||||||
9 | carrier by rail which receives the physical possession of such | ||||||
10 | property in
Illinois, and which transports such property, or | ||||||
11 | shares with another common
carrier in the transportation of | ||||||
12 | such property, out of Illinois on a standard
uniform bill of | ||||||
13 | lading showing the seller of the property as the shipper or
| ||||||
14 | consignor of such property to a destination outside Illinois, | ||||||
15 | for use outside
Illinois.
| ||||||
16 | (d-4) Until January 1, 1997, a sale, by a registered | ||||||
17 | serviceman paying tax
under this Act to the Department, of | ||||||
18 | special order printed materials delivered
outside Illinois and | ||||||
19 | which are not returned to this State, if delivery is made
by | ||||||
20 | the seller or agent of the seller, including an agent who | ||||||
21 | causes the product
to be delivered outside Illinois by a common | ||||||
22 | carrier or the U.S.
postal service.
| ||||||
23 | (e) A sale or transfer of machinery and equipment used | ||||||
24 | primarily in
the process of the manufacturing or assembling, | ||||||
25 | either in an existing, an
expanded or a new manufacturing | ||||||
26 | facility, of tangible personal property for
wholesale or retail | ||||||
27 | sale or lease, whether such sale or lease is made directly
by | ||||||
28 | the manufacturer or by some other person, whether the materials | ||||||
29 | used in the
process are owned by the manufacturer or some other | ||||||
30 | person, or whether such
sale or lease is made apart from or as | ||||||
31 | an incident to the seller's engaging in
a service occupation | ||||||
32 | and the applicable tax is a Service Occupation Tax or
Service | ||||||
33 | Use Tax, rather than Retailers' Occupation Tax or Use Tax.
| ||||||
34 | (f) Until July 1, 2003, the sale or transfer of |
| |||||||
| |||||||
1 | distillation
machinery
and equipment, sold as a
unit or kit and | ||||||
2 | assembled or installed by the retailer, which machinery
and | ||||||
3 | equipment is certified by the user to be used only for the | ||||||
4 | production
of ethyl alcohol that will be used for consumption | ||||||
5 | as motor fuel or as a
component of motor fuel for the personal | ||||||
6 | use of such user and not subject
to sale or resale.
| ||||||
7 | (g) At the election of any serviceman not required to be | ||||||
8 | otherwise
registered as a retailer under Section 2a of the | ||||||
9 | Retailers' Occupation Tax Act,
made for each fiscal year sales | ||||||
10 | of service in which the aggregate annual cost
price of tangible | ||||||
11 | personal property transferred as an incident to the sales of
| ||||||
12 | service is less than 35% (75% in the case of servicemen | ||||||
13 | transferring
prescription drugs or servicemen engaged in | ||||||
14 | graphic arts production) of the
aggregate annual total gross | ||||||
15 | receipts from all sales of service. The purchase
of such | ||||||
16 | tangible personal property by the serviceman shall be subject | ||||||
17 | to tax
under the Retailers' Occupation Tax Act and the Use Tax | ||||||
18 | Act.
However, if a
primary serviceman who has made the election | ||||||
19 | described in this paragraph
subcontracts service work to a | ||||||
20 | secondary serviceman who has also made the
election described | ||||||
21 | in this paragraph, the primary serviceman does not
incur a Use | ||||||
22 | Tax liability if the secondary serviceman (i) has paid or will | ||||||
23 | pay
Use
Tax on his or her cost price of any tangible personal | ||||||
24 | property transferred
to the primary serviceman and (ii) | ||||||
25 | certifies that fact in writing to the
primary serviceman.
| ||||||
26 | Tangible personal property transferred incident to the | ||||||
27 | completion of a
maintenance agreement is exempt from the tax | ||||||
28 | imposed pursuant to this Act.
| ||||||
29 | Beginning July 1, 2004, prewritten computer software that | ||||||
30 | is modified or enhanced, when the enhancement or modification | ||||||
31 | according to Department rules is designed and developed to the | ||||||
32 | specifications of a specific purchaser, is exempt from the tax | ||||||
33 | imposed under this Act and the transfer of that modified or | ||||||
34 | enhanced computer software is subject to tax under the |
| |||||||
| |||||||
1 | Retailers' Occupation Tax Act and the Use Tax Act.
| ||||||
2 | Exemption (e) also includes machinery and equipment used in | ||||||
3 | the
general maintenance or repair of such exempt machinery and | ||||||
4 | equipment or for
in-house manufacture of exempt machinery and | ||||||
5 | equipment.
For the purposes of exemption (e), each of these | ||||||
6 | terms shall have the following
meanings: (1) "manufacturing | ||||||
7 | process" shall mean the production of any
article of tangible | ||||||
8 | personal property, whether such article is a
finished product | ||||||
9 | or an article for use in the process of manufacturing
or | ||||||
10 | assembling a different article of tangible personal property, | ||||||
11 | by
procedures commonly regarded as manufacturing, processing, | ||||||
12 | fabricating,
or refining which changes some existing material | ||||||
13 | or materials into a
material with a different form, use or | ||||||
14 | name. In relation to a
recognized integrated business composed | ||||||
15 | of a series of operations which
collectively constitute | ||||||
16 | manufacturing, or individually constitute
manufacturing | ||||||
17 | operations, the manufacturing process shall be deemed to
| ||||||
18 | commence with the first operation or stage of production in the | ||||||
19 | series,
and shall not be deemed to end until the completion of | ||||||
20 | the final product
in the last operation or stage of production | ||||||
21 | in the series; and further for
purposes of exemption (e), | ||||||
22 | photoprocessing is deemed to be a manufacturing
process of | ||||||
23 | tangible personal property for wholesale or retail sale;
(2) | ||||||
24 | "assembling process" shall mean the production of any article | ||||||
25 | of
tangible personal property, whether such article is a | ||||||
26 | finished product
or an article for use in the process of | ||||||
27 | manufacturing or assembling a
different article of tangible | ||||||
28 | personal property, by the combination of
existing materials in | ||||||
29 | a manner commonly regarded as assembling which
results in a | ||||||
30 | material of a different form, use or name; (3) "machinery"
| ||||||
31 | shall mean major mechanical machines or major components of | ||||||
32 | such machines
contributing to a manufacturing or assembling | ||||||
33 | process; and (4) "equipment"
shall include any independent | ||||||
34 | device or tool separate from any machinery but
essential to an |
| |||||||
| |||||||
1 | integrated manufacturing or assembly process; including
| ||||||
2 | computers used primarily in a manufacturer's computer
assisted | ||||||
3 | design, computer assisted manufacturing (CAD/CAM) system; or | ||||||
4 | any
subunit or assembly comprising a component of any machinery | ||||||
5 | or auxiliary,
adjunct or attachment parts of machinery, such as | ||||||
6 | tools, dies, jigs, fixtures,
patterns and molds; or any parts | ||||||
7 | which require periodic replacement in the
course of normal | ||||||
8 | operation; but shall not include hand tools. Equipment
includes | ||||||
9 | chemicals or chemicals acting as catalysts but only if the | ||||||
10 | chemicals
or chemicals acting as catalysts effect a direct and | ||||||
11 | immediate change upon a
product being manufactured or assembled | ||||||
12 | for wholesale or retail sale or lease.
The purchaser of such | ||||||
13 | machinery and equipment
who has an active resale registration | ||||||
14 | number shall furnish such number to
the seller at the time of | ||||||
15 | purchase. The purchaser of such machinery and
equipment and | ||||||
16 | tools without an active resale registration number shall | ||||||
17 | furnish
to the seller a certificate of exemption for each | ||||||
18 | transaction stating facts
establishing the exemption for that | ||||||
19 | transaction, which certificate shall
be available to the | ||||||
20 | Department for inspection or audit.
| ||||||
21 | Except as provided in Section 2d of this Act, the rolling | ||||||
22 | stock exemption
applies to rolling
stock
used by an interstate
| ||||||
23 | carrier for hire, even just between points in Illinois, if such | ||||||
24 | rolling
stock transports, for hire, persons whose journeys or | ||||||
25 | property whose
shipments originate or terminate outside | ||||||
26 | Illinois.
| ||||||
27 | Any informal rulings, opinions or letters issued by the | ||||||
28 | Department in
response to an inquiry or request for any opinion | ||||||
29 | from any person
regarding the coverage and applicability of | ||||||
30 | exemption (e) to specific
devices shall be published, | ||||||
31 | maintained as a public record, and made
available for public | ||||||
32 | inspection and copying. If the informal ruling,
opinion or | ||||||
33 | letter contains trade secrets or other confidential
| ||||||
34 | information, where possible the Department shall delete such |
| |||||||
| |||||||
1 | information
prior to publication. Whenever such informal | ||||||
2 | rulings, opinions, or
letters contain any policy of general | ||||||
3 | applicability, the Department
shall formulate and adopt such | ||||||
4 | policy as a rule in accordance with the
provisions of the | ||||||
5 | Illinois Administrative Procedure Act.
| ||||||
6 | On and after July 1, 1987, no entity otherwise eligible | ||||||
7 | under exemption
(c) of this Section shall make tax free | ||||||
8 | purchases unless it has an active
exemption identification | ||||||
9 | number issued by the Department.
| ||||||
10 | "Serviceman" means any person who is engaged in the | ||||||
11 | occupation of
making sales of service.
| ||||||
12 | "Sale at Retail" means "sale at retail" as defined in the | ||||||
13 | Retailers'
Occupation Tax Act.
| ||||||
14 | "Supplier" means any person who makes sales of tangible | ||||||
15 | personal
property to servicemen for the purpose of resale as an | ||||||
16 | incident to a
sale of service.
| ||||||
17 | (Source: P.A. 92-484, eff. 8-23-01;
93-23, eff. 6-20-03; 93-24, | ||||||
18 | eff. 6-20-03; revised 8-21-03.)
| ||||||
19 | (35 ILCS 115/3-25) (from Ch. 120, par. 439.103-25)
| ||||||
20 | Sec. 3-25. Computer software. | ||||||
21 | (a) On and before June 30, 2004, for
For the purposes of this | ||||||
22 | Act, "computer
software" means a set of statements, data,
or | ||||||
23 | instructions to be used directly or indirectly in a computer in | ||||||
24 | order to
bring about a certain result in any form in which | ||||||
25 | those statements, data, or
instructions may be embodied, | ||||||
26 | transmitted, or fixed, by any method now known
or hereafter | ||||||
27 | developed, regardless of whether the statements, data, or
| ||||||
28 | instructions are capable of being perceived by or communicated | ||||||
29 | to humans,
and includes prewritten or canned software that is | ||||||
30 | held for repeated sale
or lease, and all associated | ||||||
31 | documentation and materials, if any, whether
contained on | ||||||
32 | magnetic tapes, discs, cards, or other devices or media, but
| ||||||
33 | does not include software that is adapted to specific |
| |||||||
| |||||||
1 | individualized
requirements of a purchaser, custom-made and | ||||||
2 | modified software designed for
a particular or limited use by a | ||||||
3 | purchaser, or software used to operate
exempt machinery and | ||||||
4 | equipment used in the process of manufacturing or
assembling | ||||||
5 | tangible personal property for wholesale or retail sale or
| ||||||
6 | lease.
| ||||||
7 | (b) On and after July 1, 2004, for the purposes of this | ||||||
8 | Act, "computer software" has the same meaning as that term is | ||||||
9 | defined in Section 2-25 of the Retailers' Occupation Tax Act.
| ||||||
10 | (c) For the purposes of this Act, computer software shall | ||||||
11 | be considered to be
tangible personal property.
| ||||||
12 | (Source: P.A. 91-51, eff. 6-30-99.)
| ||||||
13 | Section 20. The Retailers' Occupation Tax Act is amended by | ||||||
14 | changing Sections 1, 2, and 2-25 as follows:
| ||||||
15 | (35 ILCS 120/1) (from Ch. 120, par. 440)
| ||||||
16 | Sec. 1. Definitions. "Sale at retail" means any transfer of | ||||||
17 | the
ownership of or title to
tangible personal property to a | ||||||
18 | purchaser, for the purpose of use or
consumption, and not for | ||||||
19 | the purpose of resale in any form as tangible
personal property | ||||||
20 | to the extent not first subjected to a use for which it
was | ||||||
21 | purchased, for a valuable consideration: Provided that the | ||||||
22 | property
purchased is deemed to be purchased for the purpose of | ||||||
23 | resale, despite
first being used, to the extent to which it is | ||||||
24 | resold as an ingredient of
an intentionally produced product or | ||||||
25 | byproduct of manufacturing. For this
purpose, slag produced as | ||||||
26 | an incident to manufacturing pig iron or steel
and sold is | ||||||
27 | considered to be an intentionally produced byproduct of
| ||||||
28 | manufacturing. Transactions whereby the possession of the | ||||||
29 | property is
transferred but the seller retains the title as | ||||||
30 | security for payment of the
selling price shall be deemed to be | ||||||
31 | sales.
| ||||||
32 | Beginning July 1, 2004, "sale at retail" includes licenses |
| |||||||
| |||||||
1 | of prewritten computer software and any other transfer, for | ||||||
2 | consideration, of the possession or right to use prewritten | ||||||
3 | computer software, no matter how the transaction is | ||||||
4 | characterized by the parties.
| ||||||
5 | "Sale at retail" shall be construed to include any transfer | ||||||
6 | of the
ownership of or title to tangible personal property to a | ||||||
7 | purchaser, for use
or consumption by any other person to whom | ||||||
8 | such purchaser may transfer the
tangible personal property | ||||||
9 | without a valuable consideration, and to include
any transfer, | ||||||
10 | whether made for or without a valuable consideration, for
| ||||||
11 | resale in any form as tangible personal property unless made in | ||||||
12 | compliance
with Section 2c of this Act.
| ||||||
13 | Sales of tangible personal property, which property, to the | ||||||
14 | extent not
first subjected to a use for which it was purchased, | ||||||
15 | as an ingredient or
constituent, goes into and forms a part of | ||||||
16 | tangible personal property
subsequently the subject of a "Sale | ||||||
17 | at retail", are not sales at retail as
defined in this Act: | ||||||
18 | Provided that the property purchased is deemed to be
purchased | ||||||
19 | for the purpose of resale, despite first being used, to the
| ||||||
20 | extent to which it is resold as an ingredient of an | ||||||
21 | intentionally produced
product or byproduct of manufacturing.
| ||||||
22 | "Sale at retail" shall be construed to include any Illinois | ||||||
23 | florist's
sales transaction in which the purchase order is | ||||||
24 | received in Illinois by a
florist and the sale is for use or | ||||||
25 | consumption, but the Illinois florist
has a florist in another | ||||||
26 | state deliver the property to the purchaser or the
purchaser's | ||||||
27 | donee in such other state.
| ||||||
28 | Nonreusable tangible personal property that is used by | ||||||
29 | persons engaged in
the business of operating a restaurant, | ||||||
30 | cafeteria, or drive-in is a sale for
resale when it is | ||||||
31 | transferred to customers in the ordinary course of business
as | ||||||
32 | part of the sale of food or beverages and is used to deliver, | ||||||
33 | package, or
consume food or beverages, regardless of where | ||||||
34 | consumption of the food or
beverages occurs. Examples of those |
| |||||||
| |||||||
1 | items include, but are not limited to
nonreusable, paper and | ||||||
2 | plastic cups, plates, baskets, boxes, sleeves, buckets
or other | ||||||
3 | containers, utensils, straws, placemats, napkins, doggie bags, | ||||||
4 | and
wrapping or packaging
materials that are transferred to | ||||||
5 | customers as part of the sale of food or
beverages in the | ||||||
6 | ordinary course of business.
| ||||||
7 | The purchase, employment and transfer of such tangible | ||||||
8 | personal property
as newsprint and ink for the primary purpose | ||||||
9 | of conveying news (with or
without other information) is not a | ||||||
10 | purchase, use or sale of tangible
personal property.
| ||||||
11 | A person whose activities are organized and conducted | ||||||
12 | primarily as a
not-for-profit service enterprise, and who | ||||||
13 | engages in selling tangible
personal property at retail | ||||||
14 | (whether to the public or merely to members and
their guests) | ||||||
15 | is engaged in the business of selling tangible personal
| ||||||
16 | property at retail with respect to such transactions, excepting | ||||||
17 | only a
person organized and operated exclusively for | ||||||
18 | charitable, religious or
educational purposes either (1), to | ||||||
19 | the extent of sales by such person to
its members, students, | ||||||
20 | patients or inmates of tangible personal property to
be used | ||||||
21 | primarily for the purposes of such person, or (2), to the | ||||||
22 | extent of
sales by such person of tangible personal property | ||||||
23 | which is not sold or
offered for sale by persons organized for | ||||||
24 | profit. The selling of school
books and school supplies by | ||||||
25 | schools at retail to students is not
"primarily for the | ||||||
26 | purposes of" the school which does such selling. The
provisions | ||||||
27 | of this paragraph shall not apply to nor subject to taxation
| ||||||
28 | occasional dinners, socials or similar activities of a person | ||||||
29 | organized and
operated exclusively for charitable, religious | ||||||
30 | or educational purposes,
whether or not such activities are | ||||||
31 | open to the public.
| ||||||
32 | A person who is the recipient of a grant or contract under | ||||||
33 | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | ||||||
34 | serves meals to
participants in the federal Nutrition Program |
| |||||||
| |||||||
1 | for the Elderly in return for
contributions established in | ||||||
2 | amount by the individual participant pursuant
to a schedule of | ||||||
3 | suggested fees as provided for in the federal Act is not
| ||||||
4 | engaged in the business of selling tangible personal property | ||||||
5 | at retail
with respect to such transactions.
| ||||||
6 | "Purchaser" means anyone who, through a sale at retail, | ||||||
7 | acquires the
ownership of or title to tangible personal | ||||||
8 | property for a valuable
consideration.
| ||||||
9 | "Reseller of motor fuel" means any person engaged in the | ||||||
10 | business of selling
or delivering or transferring title of | ||||||
11 | motor fuel to another person
other than for use or consumption.
| ||||||
12 | No person shall act as a reseller of motor fuel within this | ||||||
13 | State without
first being registered as a reseller pursuant to | ||||||
14 | Section 2c or a retailer
pursuant to Section 2a.
| ||||||
15 | "Selling price" or the "amount of sale" means the | ||||||
16 | consideration for a
sale valued in money whether received in | ||||||
17 | money or otherwise, including
cash, credits, property, other | ||||||
18 | than as hereinafter provided, and services,
but not including | ||||||
19 | the value of or credit given for traded-in tangible
personal | ||||||
20 | property where the item that is traded-in is of like kind and
| ||||||
21 | character as that which is being sold, and shall be determined | ||||||
22 | without any
deduction on account of the cost of the property | ||||||
23 | sold, the cost of
materials used, labor or service cost or any | ||||||
24 | other expense whatsoever, but
does not include charges that are | ||||||
25 | added to prices by sellers on account of
the seller's tax | ||||||
26 | liability under this Act, or on account of the seller's
duty to | ||||||
27 | collect, from the purchaser, the tax that is imposed by the Use | ||||||
28 | Tax
Act, or on account of the seller's tax liability under | ||||||
29 | Section 8-11-1 of
the Illinois Municipal Code, as heretofore | ||||||
30 | and hereafter amended, or on
account of the seller's tax | ||||||
31 | liability under the County Retailers'
Occupation Tax Act, or on | ||||||
32 | account of the seller's tax liability under the
Home Rule | ||||||
33 | Municipal Soft Drink Retailers' Occupation Tax,
or on account | ||||||
34 | of the seller's tax liability under any tax imposed under the
|
| |||||||
| |||||||
1 | "Regional Transportation Authority Act", approved December 12, | ||||||
2 | 1973.
Effective December 1, 1985, "selling price" shall include | ||||||
3 | charges that
are added to prices by sellers on account of the | ||||||
4 | seller's
tax liability under the Cigarette Tax Act, on account | ||||||
5 | of the sellers'
duty to collect, from the purchaser, the tax | ||||||
6 | imposed under the Cigarette
Use Tax Act, and on account of the | ||||||
7 | seller's duty to collect, from the
purchaser, any cigarette tax | ||||||
8 | imposed by a home rule unit.
| ||||||
9 | The phrase "like kind and character" shall be liberally | ||||||
10 | construed
(including but not limited to any form of motor | ||||||
11 | vehicle for any form of
motor vehicle, or any kind of farm or | ||||||
12 | agricultural implement for any other
kind of farm or | ||||||
13 | agricultural implement), while not including a kind of item
| ||||||
14 | which, if sold at retail by that retailer, would be exempt from | ||||||
15 | retailers'
occupation tax and use tax as an isolated or | ||||||
16 | occasional sale.
| ||||||
17 | "Gross receipts" from the sales of tangible personal | ||||||
18 | property at retail
means the total selling price or the amount | ||||||
19 | of such sales, as hereinbefore
defined. In the case of charge | ||||||
20 | and time sales, the amount thereof shall be
included only as | ||||||
21 | and when payments are received by the seller.
Receipts or other | ||||||
22 | consideration derived by a seller from
the sale, transfer or | ||||||
23 | assignment of accounts receivable to a wholly owned
subsidiary | ||||||
24 | will not be deemed payments prior to the time the purchaser
| ||||||
25 | makes payment on such accounts.
| ||||||
26 | "Department" means the Department of Revenue.
| ||||||
27 | "Person" means any natural individual, firm, partnership, | ||||||
28 | association,
joint stock company, joint adventure, public or | ||||||
29 | private corporation, limited
liability company, or a receiver, | ||||||
30 | executor, trustee, guardian or other
representative appointed | ||||||
31 | by order of any court.
| ||||||
32 | The isolated or occasional sale of tangible personal | ||||||
33 | property at retail
by a person who does not hold himself out as | ||||||
34 | being engaged (or who does not
habitually engage) in selling |
| |||||||
| |||||||
1 | such tangible personal property at retail, or
a sale through a | ||||||
2 | bulk vending machine, does not constitute engaging in a
| ||||||
3 | business of selling such tangible personal property at retail | ||||||
4 | within the
meaning of this Act; provided that any person who is | ||||||
5 | engaged in a business
which is not subject to the tax imposed | ||||||
6 | by this Act because of involving
the sale of or a contract to | ||||||
7 | sell real estate or a construction contract to
improve real | ||||||
8 | estate or a construction contract to engineer, install, and
| ||||||
9 | maintain an integrated system of products, but who, in the | ||||||
10 | course of
conducting such business,
transfers tangible | ||||||
11 | personal property to users or consumers in the finished
form in | ||||||
12 | which it was purchased, and which does not become real estate | ||||||
13 | or was
not engineered and installed, under any provision of a | ||||||
14 | construction contract or
real estate sale or real estate sales | ||||||
15 | agreement entered into with some other
person arising out of or | ||||||
16 | because of such nontaxable business, is engaged in the
business | ||||||
17 | of selling tangible personal property at retail to the extent | ||||||
18 | of the
value of the tangible personal property so transferred. | ||||||
19 | If, in such a
transaction, a separate charge is made for the | ||||||
20 | tangible personal property so
transferred, the value of such | ||||||
21 | property, for the purpose of this Act, shall be
the amount so | ||||||
22 | separately charged, but not less than the cost of such property
| ||||||
23 | to the transferor; if no separate charge is made, the value of | ||||||
24 | such property,
for the purposes of this Act, is the cost to the | ||||||
25 | transferor of such tangible
personal property. Construction | ||||||
26 | contracts for the improvement of real estate
consisting of | ||||||
27 | engineering, installation, and maintenance of voice, data, | ||||||
28 | video,
security, and all telecommunication systems do not | ||||||
29 | constitute engaging in a
business of selling tangible personal | ||||||
30 | property at retail within the meaning of
this Act if they are | ||||||
31 | sold at one specified contract price.
| ||||||
32 | A person who holds himself or herself out as being engaged | ||||||
33 | (or who habitually
engages) in selling tangible personal | ||||||
34 | property at retail is a person
engaged in the business of |
| |||||||
| |||||||
1 | selling tangible personal property at retail
hereunder with | ||||||
2 | respect to such sales (and not primarily in a service
| ||||||
3 | occupation) notwithstanding the fact that such person designs | ||||||
4 | and produces
such tangible personal property on special order | ||||||
5 | for the purchaser and in
such a way as to render the property | ||||||
6 | of value only to such purchaser, if
such tangible personal | ||||||
7 | property so produced on special order serves
substantially the | ||||||
8 | same function as stock or standard items of tangible
personal | ||||||
9 | property that are sold at retail.
| ||||||
10 | Persons who engage in the business of transferring tangible | ||||||
11 | personal
property upon the redemption of trading stamps are | ||||||
12 | engaged in the business
of selling such property at retail and | ||||||
13 | shall be liable for and shall pay
the tax imposed by this Act | ||||||
14 | on the basis of the retail value of the
property transferred | ||||||
15 | upon redemption of such stamps.
| ||||||
16 | "Bulk vending machine" means a vending machine,
containing | ||||||
17 | unsorted confections, nuts, toys, or other items designed
| ||||||
18 | primarily to be used or played with by children
which, when a | ||||||
19 | coin or coins of a denomination not larger than $0.50 are
| ||||||
20 | inserted, are dispensed in equal portions, at random and
| ||||||
21 | without selection by the customer.
| ||||||
22 | (Source: P.A. 92-213, eff. 1-1-02.)
| ||||||
23 | (35 ILCS 120/2) (from Ch. 120, par. 441)
| ||||||
24 | Sec. 2. Tax imposed. A tax is imposed upon persons engaged | ||||||
25 | in the
business of selling at retail tangible personal | ||||||
26 | property, including
computer software, and including | ||||||
27 | photographs, negatives, and positives that
are the product of | ||||||
28 | photoprocessing, but not including products of
photoprocessing | ||||||
29 | produced for use in motion pictures for public commercial
| ||||||
30 | exhibition.
Beginning January 1, 2001, prepaid telephone | ||||||
31 | calling arrangements shall be
considered tangible personal | ||||||
32 | property subject to the tax imposed under this Act
regardless | ||||||
33 | of the form in which those arrangements may be embodied,
|
| |||||||
| |||||||
1 | transmitted, or fixed by any method now known or hereafter | ||||||
2 | developed. Beginning July 1, 2004, computer software subject to | ||||||
3 | tax under this Act includes licenses of prewritten computer | ||||||
4 | software and any other transfer, for consideration, of the | ||||||
5 | possession or right to use prewritten computer software, no | ||||||
6 | matter how the transaction is characterized by the parties.
| ||||||
7 | (Source: P.A. 91-51, eff. 6-30-99; 91-870, eff. 6-22-00.)
| ||||||
8 | (35 ILCS 120/2-25) (from Ch. 120, par. 441-25)
| ||||||
9 | Sec. 2-25. Computer software. For the purposes of this Act, | ||||||
10 | "computer
software" means a set of statements, data,
or | ||||||
11 | instructions to be used directly or indirectly in a computer in | ||||||
12 | order to
bring about a certain result in any form in which | ||||||
13 | those statements, data, or
instructions may be embodied, | ||||||
14 | transmitted, or fixed, by any method now known
or hereafter | ||||||
15 | developed, regardless of whether the statements, data, or
| ||||||
16 | instructions are capable of being perceived by or communicated | ||||||
17 | to humans,
and includes prewritten or canned software that is | ||||||
18 | held for repeated sale
or lease, and all associated | ||||||
19 | documentation and materials, if any, whether
contained on | ||||||
20 | magnetic tapes, discs, cards, or other devices or media, but
| ||||||
21 | does not include (i) on and before June 30, 2004, software that | ||||||
22 | is adapted to specific individualized
requirements of a | ||||||
23 | purchaser, custom-made and modified software designed for
a | ||||||
24 | particular or limited use by a purchaser, or (ii) software used | ||||||
25 | to operate
exempt machinery and equipment used in the process | ||||||
26 | of manufacturing or
assembling tangible personal property for | ||||||
27 | wholesale or retail sale or
lease.
| ||||||
28 | Beginning on July 1, 2004, "prewritten computer software" | ||||||
29 | means computer software, including upgrades, that is not | ||||||
30 | designed and developed by the author or other creator to the | ||||||
31 | specifications of a specific purchaser. The combining of 2 or | ||||||
32 | more "prewritten computer software" programs or prewritten | ||||||
33 | portions thereof does not cause the combination to be other |
| |||||||
| |||||||
1 | than "prewritten computer software". "Prewritten computer | ||||||
2 | software" includes software designed and developed by the | ||||||
3 | author or other creator to the specifications of a specific | ||||||
4 | purchaser when it is sold to a person other than the specific | ||||||
5 | purchaser. If a person modifies or enhances computer software | ||||||
6 | of which the person is not the author or creator, the person | ||||||
7 | shall be deemed to be the author or creator only of that | ||||||
8 | person's modifications or enhancements. "Prewritten computer | ||||||
9 | software" or a prewritten portion thereof that is modified or | ||||||
10 | enhanced to any degree, when the modification or enhancement | ||||||
11 | according to Department rules is designed and developed to the | ||||||
12 | specifications of a specific purchaser, remains "prewritten | ||||||
13 | computer software", except that when there is a reasonable | ||||||
14 | separately stated charge or an invoice or other statement of | ||||||
15 | the price given to the purchaser for the modification or | ||||||
16 | enhancement, the modification or enhancement does not | ||||||
17 | constitute "prewritten computer software".
| ||||||
18 | For the purposes of this Act, computer software shall be | ||||||
19 | considered to be
tangible personal property.
| ||||||
20 | (Source: P.A. 91-51, eff. 6-30-99.)
| ||||||
21 | Section 99. Effective date. This Act takes effect upon | ||||||
22 | becoming law.".
|