102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
SB0058

 

Introduced 1/29/2021, by Sen. Antonio Muņoz

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/2  from Ch. 120, par. 439.2
35 ILCS 120/1  from Ch. 120, par. 440
625 ILCS 5/3-1001  from Ch. 95 1/2, par. 3-1001

    Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides that, beginning 120 days after the effective date of the amendatory Act, the term "selling price" no longer includes the value of traded-in motor vehicles. Amends the Illinois Vehicle Code. In a Section concerning the use tax on motor vehicles, makes changes concerning the amount of the tax. Provides that the tax on motorcycles, motor driven cycles, and mopeds shall be the same as for all other motor vehicles. Effective immediately.


LRB102 04504 HLH 14523 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB0058LRB102 04504 HLH 14523 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Section 2
5as follows:
 
6    (35 ILCS 105/2)  (from Ch. 120, par. 439.2)
7    Sec. 2. Definitions.
8    "Use" means the exercise by any person of any right or
9power over tangible personal property incident to the
10ownership of that property, except that it does not include
11the sale of such property in any form as tangible personal
12property in the regular course of business to the extent that
13such property is not first subjected to a use for which it was
14purchased, and does not include the use of such property by its
15owner for demonstration purposes: Provided that the property
16purchased is deemed to be purchased for the purpose of resale,
17despite first being used, to the extent to which it is resold
18as an ingredient of an intentionally produced product or
19by-product of manufacturing. "Use" does not mean the
20demonstration use or interim use of tangible personal property
21by a retailer before he sells that tangible personal property.
22For watercraft or aircraft, if the period of demonstration use
23or interim use by the retailer exceeds 18 months, the retailer

 

 

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1shall pay on the retailers' original cost price the tax
2imposed by this Act, and no credit for that tax is permitted if
3the watercraft or aircraft is subsequently sold by the
4retailer. "Use" does not mean the physical incorporation of
5tangible personal property, to the extent not first subjected
6to a use for which it was purchased, as an ingredient or
7constituent, into other tangible personal property (a) which
8is sold in the regular course of business or (b) which the
9person incorporating such ingredient or constituent therein
10has undertaken at the time of such purchase to cause to be
11transported in interstate commerce to destinations outside the
12State of Illinois: Provided that the property purchased is
13deemed to be purchased for the purpose of resale, despite
14first being used, to the extent to which it is resold as an
15ingredient of an intentionally produced product or by-product
16of manufacturing.
17    "Watercraft" means a Class 2, Class 3, or Class 4
18watercraft as defined in Section 3-2 of the Boat Registration
19and Safety Act, a personal watercraft, or any boat equipped
20with an inboard motor.
21    "Purchase at retail" means the acquisition of the
22ownership of or title to tangible personal property through a
23sale at retail.
24    "Purchaser" means anyone who, through a sale at retail,
25acquires the ownership of tangible personal property for a
26valuable consideration.

 

 

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1    "Sale at retail" means any transfer of the ownership of or
2title to tangible personal property to a purchaser, for the
3purpose of use, and not for the purpose of resale in any form
4as tangible personal property to the extent not first
5subjected to a use for which it was purchased, for a valuable
6consideration: Provided that the property purchased is deemed
7to be purchased for the purpose of resale, despite first being
8used, to the extent to which it is resold as an ingredient of
9an intentionally produced product or by-product of
10manufacturing. For this purpose, slag produced as an incident
11to manufacturing pig iron or steel and sold is considered to be
12an intentionally produced by-product of manufacturing. "Sale
13at retail" includes any such transfer made for resale unless
14made in compliance with Section 2c of the Retailers'
15Occupation Tax Act, as incorporated by reference into Section
1612 of this Act. Transactions whereby the possession of the
17property is transferred but the seller retains the title as
18security for payment of the selling price are sales.
19    "Sale at retail" shall also be construed to include any
20Illinois florist's sales transaction in which the purchase
21order is received in Illinois by a florist and the sale is for
22use or consumption, but the Illinois florist has a florist in
23another state deliver the property to the purchaser or the
24purchaser's donee in such other state.
25    Nonreusable tangible personal property that is used by
26persons engaged in the business of operating a restaurant,

 

 

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1cafeteria, or drive-in is a sale for resale when it is
2transferred to customers in the ordinary course of business as
3part of the sale of food or beverages and is used to deliver,
4package, or consume food or beverages, regardless of where
5consumption of the food or beverages occurs. Examples of those
6items include, but are not limited to nonreusable, paper and
7plastic cups, plates, baskets, boxes, sleeves, buckets or
8other containers, utensils, straws, placemats, napkins, doggie
9bags, and wrapping or packaging materials that are transferred
10to customers as part of the sale of food or beverages in the
11ordinary course of business.
12    The purchase, employment and transfer of such tangible
13personal property as newsprint and ink for the primary purpose
14of conveying news (with or without other information) is not a
15purchase, use or sale of tangible personal property.
16    "Selling price" means the consideration for a sale valued
17in money whether received in money or otherwise, including
18cash, credits, property other than as hereinafter provided,
19and services, but, prior to January 1, 2020 and beginning
20again 120 days after the effective date of this amendatory Act
21of the 102nd General Assembly, not including the value of or
22credit given for traded-in tangible personal property where
23the item that is traded-in is of like kind and character as
24that which is being sold; beginning January 1, 2020 and until
25120 days after the effective date of this amendatory Act of the
26102nd General Assembly, "selling price" includes the portion

 

 

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1of the value of or credit given for traded-in motor vehicles of
2the First Division as defined in Section 1-146 of the Illinois
3Vehicle Code of like kind and character as that which is being
4sold that exceeds $10,000. "Selling price" shall be determined
5without any deduction on account of the cost of the property
6sold, the cost of materials used, labor or service cost or any
7other expense whatsoever, but does not include interest or
8finance charges which appear as separate items on the bill of
9sale or sales contract nor charges that are added to prices by
10sellers on account of the seller's tax liability under the
11Retailers' Occupation Tax Act, or on account of the seller's
12duty to collect, from the purchaser, the tax that is imposed by
13this Act, or, except as otherwise provided with respect to any
14cigarette tax imposed by a home rule unit, on account of the
15seller's tax liability under any local occupation tax
16administered by the Department, or, except as otherwise
17provided with respect to any cigarette tax imposed by a home
18rule unit on account of the seller's duty to collect, from the
19purchasers, the tax that is imposed under any local use tax
20administered by the Department. Effective December 1, 1985,
21"selling price" shall include charges that are added to prices
22by sellers on account of the seller's tax liability under the
23Cigarette Tax Act, on account of the seller's duty to collect,
24from the purchaser, the tax imposed under the Cigarette Use
25Tax Act, and on account of the seller's duty to collect, from
26the purchaser, any cigarette tax imposed by a home rule unit.

 

 

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1    Notwithstanding any law to the contrary, for any motor
2vehicle, as defined in Section 1-146 of the Vehicle Code, that
3is sold on or after January 1, 2015 for the purpose of leasing
4the vehicle for a defined period that is longer than one year
5and (1) is a motor vehicle of the second division that: (A) is
6a self-contained motor vehicle designed or permanently
7converted to provide living quarters for recreational,
8camping, or travel use, with direct walk through access to the
9living quarters from the driver's seat; (B) is of the van
10configuration designed for the transportation of not less than
117 nor more than 16 passengers; or (C) has a gross vehicle
12weight rating of 8,000 pounds or less or (2) is a motor vehicle
13of the first division, "selling price" or "amount of sale"
14means the consideration received by the lessor pursuant to the
15lease contract, including amounts due at lease signing and all
16monthly or other regular payments charged over the term of the
17lease. Also included in the selling price is any amount
18received by the lessor from the lessee for the leased vehicle
19that is not calculated at the time the lease is executed,
20including, but not limited to, excess mileage charges and
21charges for excess wear and tear. For sales that occur in
22Illinois, with respect to any amount received by the lessor
23from the lessee for the leased vehicle that is not calculated
24at the time the lease is executed, the lessor who purchased the
25motor vehicle does not incur the tax imposed by the Use Tax Act
26on those amounts, and the retailer who makes the retail sale of

 

 

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1the motor vehicle to the lessor is not required to collect the
2tax imposed by this Act or to pay the tax imposed by the
3Retailers' Occupation Tax Act on those amounts. However, the
4lessor who purchased the motor vehicle assumes the liability
5for reporting and paying the tax on those amounts directly to
6the Department in the same form (Illinois Retailers'
7Occupation Tax, and local retailers' occupation taxes, if
8applicable) in which the retailer would have reported and paid
9such tax if the retailer had accounted for the tax to the
10Department. For amounts received by the lessor from the lessee
11that are not calculated at the time the lease is executed, the
12lessor must file the return and pay the tax to the Department
13by the due date otherwise required by this Act for returns
14other than transaction returns. If the retailer is entitled
15under this Act to a discount for collecting and remitting the
16tax imposed under this Act to the Department with respect to
17the sale of the motor vehicle to the lessor, then the right to
18the discount provided in this Act shall be transferred to the
19lessor with respect to the tax paid by the lessor for any
20amount received by the lessor from the lessee for the leased
21vehicle that is not calculated at the time the lease is
22executed; provided that the discount is only allowed if the
23return is timely filed and for amounts timely paid. The
24"selling price" of a motor vehicle that is sold on or after
25January 1, 2015 for the purpose of leasing for a defined period
26of longer than one year shall not be reduced by the value of or

 

 

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1credit given for traded-in tangible personal property owned by
2the lessor, nor shall it be reduced by the value of or credit
3given for traded-in tangible personal property owned by the
4lessee, regardless of whether the trade-in value thereof is
5assigned by the lessee to the lessor. In the case of a motor
6vehicle that is sold for the purpose of leasing for a defined
7period of longer than one year, the sale occurs at the time of
8the delivery of the vehicle, regardless of the due date of any
9lease payments. A lessor who incurs a Retailers' Occupation
10Tax liability on the sale of a motor vehicle coming off lease
11may not take a credit against that liability for the Use Tax
12the lessor paid upon the purchase of the motor vehicle (or for
13any tax the lessor paid with respect to any amount received by
14the lessor from the lessee for the leased vehicle that was not
15calculated at the time the lease was executed) if the selling
16price of the motor vehicle at the time of purchase was
17calculated using the definition of "selling price" as defined
18in this paragraph. Notwithstanding any other provision of this
19Act to the contrary, lessors shall file all returns and make
20all payments required under this paragraph to the Department
21by electronic means in the manner and form as required by the
22Department. This paragraph does not apply to leases of motor
23vehicles for which, at the time the lease is entered into, the
24term of the lease is not a defined period, including leases
25with a defined initial period with the option to continue the
26lease on a month-to-month or other basis beyond the initial

 

 

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1defined period.
2    The phrase "like kind and character" shall be liberally
3construed (including but not limited to any form of motor
4vehicle for any form of motor vehicle, or any kind of farm or
5agricultural implement for any other kind of farm or
6agricultural implement), while not including a kind of item
7which, if sold at retail by that retailer, would be exempt from
8retailers' occupation tax and use tax as an isolated or
9occasional sale.
10    "Department" means the Department of Revenue.
11    "Person" means any natural individual, firm, partnership,
12association, joint stock company, joint adventure, public or
13private corporation, limited liability company, or a receiver,
14executor, trustee, guardian or other representative appointed
15by order of any court.
16    "Retailer" means and includes every person engaged in the
17business of making sales at retail as defined in this Section.
18    A person who holds himself or herself out as being engaged
19(or who habitually engages) in selling tangible personal
20property at retail is a retailer hereunder with respect to
21such sales (and not primarily in a service occupation)
22notwithstanding the fact that such person designs and produces
23such tangible personal property on special order for the
24purchaser and in such a way as to render the property of value
25only to such purchaser, if such tangible personal property so
26produced on special order serves substantially the same

 

 

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1function as stock or standard items of tangible personal
2property that are sold at retail.
3    A person whose activities are organized and conducted
4primarily as a not-for-profit service enterprise, and who
5engages in selling tangible personal property at retail
6(whether to the public or merely to members and their guests)
7is a retailer with respect to such transactions, excepting
8only a person organized and operated exclusively for
9charitable, religious or educational purposes either (1), to
10the extent of sales by such person to its members, students,
11patients or inmates of tangible personal property to be used
12primarily for the purposes of such person, or (2), to the
13extent of sales by such person of tangible personal property
14which is not sold or offered for sale by persons organized for
15profit. The selling of school books and school supplies by
16schools at retail to students is not "primarily for the
17purposes of" the school which does such selling. This
18paragraph does not apply to nor subject to taxation occasional
19dinners, social or similar activities of a person organized
20and operated exclusively for charitable, religious or
21educational purposes, whether or not such activities are open
22to the public.
23    A person who is the recipient of a grant or contract under
24Title VII of the Older Americans Act of 1965 (P.L. 92-258) and
25serves meals to participants in the federal Nutrition Program
26for the Elderly in return for contributions established in

 

 

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1amount by the individual participant pursuant to a schedule of
2suggested fees as provided for in the federal Act is not a
3retailer under this Act with respect to such transactions.
4    Persons who engage in the business of transferring
5tangible personal property upon the redemption of trading
6stamps are retailers hereunder when engaged in such business.
7    The isolated or occasional sale of tangible personal
8property at retail by a person who does not hold himself out as
9being engaged (or who does not habitually engage) in selling
10such tangible personal property at retail or a sale through a
11bulk vending machine does not make such person a retailer
12hereunder. However, any person who is engaged in a business
13which is not subject to the tax imposed by the Retailers'
14Occupation Tax Act because of involving the sale of or a
15contract to sell real estate or a construction contract to
16improve real estate, but who, in the course of conducting such
17business, transfers tangible personal property to users or
18consumers in the finished form in which it was purchased, and
19which does not become real estate, under any provision of a
20construction contract or real estate sale or real estate sales
21agreement entered into with some other person arising out of
22or because of such nontaxable business, is a retailer to the
23extent of the value of the tangible personal property so
24transferred. If, in such transaction, a separate charge is
25made for the tangible personal property so transferred, the
26value of such property, for the purposes of this Act, is the

 

 

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1amount so separately charged, but not less than the cost of
2such property to the transferor; if no separate charge is
3made, the value of such property, for the purposes of this Act,
4is the cost to the transferor of such tangible personal
5property.
6    "Retailer maintaining a place of business in this State",
7or any like term, means and includes any of the following
8retailers:
9        (1) A retailer having or maintaining within this
10    State, directly or by a subsidiary, an office,
11    distribution house, sales house, warehouse or other place
12    of business, or any agent or other representative
13    operating within this State under the authority of the
14    retailer or its subsidiary, irrespective of whether such
15    place of business or agent or other representative is
16    located here permanently or temporarily, or whether such
17    retailer or subsidiary is licensed to do business in this
18    State. However, the ownership of property that is located
19    at the premises of a printer with which the retailer has
20    contracted for printing and that consists of the final
21    printed product, property that becomes a part of the final
22    printed product, or copy from which the printed product is
23    produced shall not result in the retailer being deemed to
24    have or maintain an office, distribution house, sales
25    house, warehouse, or other place of business within this
26    State.

 

 

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1        (1.1) A retailer having a contract with a person
2    located in this State under which the person, for a
3    commission or other consideration based upon the sale of
4    tangible personal property by the retailer, directly or
5    indirectly refers potential customers to the retailer by
6    providing to the potential customers a promotional code or
7    other mechanism that allows the retailer to track
8    purchases referred by such persons. Examples of mechanisms
9    that allow the retailer to track purchases referred by
10    such persons include but are not limited to the use of a
11    link on the person's Internet website, promotional codes
12    distributed through the person's hand-delivered or mailed
13    material, and promotional codes distributed by the person
14    through radio or other broadcast media. The provisions of
15    this paragraph (1.1) shall apply only if the cumulative
16    gross receipts from sales of tangible personal property by
17    the retailer to customers who are referred to the retailer
18    by all persons in this State under such contracts exceed
19    $10,000 during the preceding 4 quarterly periods ending on
20    the last day of March, June, September, and December. A
21    retailer meeting the requirements of this paragraph (1.1)
22    shall be presumed to be maintaining a place of business in
23    this State but may rebut this presumption by submitting
24    proof that the referrals or other activities pursued
25    within this State by such persons were not sufficient to
26    meet the nexus standards of the United States Constitution

 

 

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1    during the preceding 4 quarterly periods.
2        (1.2) Beginning July 1, 2011, a retailer having a
3    contract with a person located in this State under which:
4            (A) the retailer sells the same or substantially
5        similar line of products as the person located in this
6        State and does so using an identical or substantially
7        similar name, trade name, or trademark as the person
8        located in this State; and
9            (B) the retailer provides a commission or other
10        consideration to the person located in this State
11        based upon the sale of tangible personal property by
12        the retailer.
13        The provisions of this paragraph (1.2) shall apply
14    only if the cumulative gross receipts from sales of
15    tangible personal property by the retailer to customers in
16    this State under all such contracts exceed $10,000 during
17    the preceding 4 quarterly periods ending on the last day
18    of March, June, September, and December.
19        (2) (Blank).
20        (3) (Blank).
21        (4) (Blank).
22        (5) (Blank).
23        (6) (Blank).
24        (7) (Blank).
25        (8) (Blank).
26        (9) Beginning October 1, 2018, a retailer making sales

 

 

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1    of tangible personal property to purchasers in Illinois
2    from outside of Illinois if:
3            (A) the cumulative gross receipts from sales of
4        tangible personal property to purchasers in Illinois
5        are $100,000 or more; or
6            (B) the retailer enters into 200 or more separate
7        transactions for the sale of tangible personal
8        property to purchasers in Illinois.
9        The retailer shall determine on a quarterly basis,
10    ending on the last day of March, June, September, and
11    December, whether he or she meets the criteria of either
12    subparagraph (A) or (B) of this paragraph (9) for the
13    preceding 12-month period. If the retailer meets the
14    threshold of either subparagraph (A) or (B) for a 12-month
15    period, he or she is considered a retailer maintaining a
16    place of business in this State and is required to collect
17    and remit the tax imposed under this Act and file returns
18    for one year. At the end of that one-year period, the
19    retailer shall determine whether he or she met the
20    threshold of either subparagraph (A) or (B) during the
21    preceding 12-month period. If the retailer met the
22    criteria in either subparagraph (A) or (B) for the
23    preceding 12-month period, he or she is considered a
24    retailer maintaining a place of business in this State and
25    is required to collect and remit the tax imposed under
26    this Act and file returns for the subsequent year. If at

 

 

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1    the end of a one-year period a retailer that was required
2    to collect and remit the tax imposed under this Act
3    determines that he or she did not meet the threshold in
4    either subparagraph (A) or (B) during the preceding
5    12-month period, the retailer shall subsequently determine
6    on a quarterly basis, ending on the last day of March,
7    June, September, and December, whether he or she meets the
8    threshold of either subparagraph (A) or (B) for the
9    preceding 12-month period.
10        Beginning January 1, 2020, neither the gross receipts
11    from nor the number of separate transactions for sales of
12    tangible personal property to purchasers in Illinois that
13    a retailer makes through a marketplace facilitator and for
14    which the retailer has received a certification from the
15    marketplace facilitator pursuant to Section 2d of this Act
16    shall be included for purposes of determining whether he
17    or she has met the thresholds of this paragraph (9).
18        (10) Beginning January 1, 2020, a marketplace
19    facilitator that meets a threshold set forth in subsection
20    (b) of Section 2d of this Act.
21    "Bulk vending machine" means a vending machine, containing
22unsorted confections, nuts, toys, or other items designed
23primarily to be used or played with by children which, when a
24coin or coins of a denomination not larger than $0.50 are
25inserted, are dispensed in equal portions, at random and
26without selection by the customer.

 

 

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1(Source: P.A. 100-587, eff. 6-4-18; 101-9, eff. 6-5-19;
2101-31, eff. 1-1-20; 101-604, eff. 1-1-20.)
 
3    Section 10. The Retailers' Occupation Tax Act is amended
4by changing Section 1 as follows:
 
5    (35 ILCS 120/1)  (from Ch. 120, par. 440)
6    Sec. 1. Definitions. "Sale at retail" means any transfer
7of the ownership of or title to tangible personal property to a
8purchaser, for the purpose of use or consumption, and not for
9the purpose of resale in any form as tangible personal
10property to the extent not first subjected to a use for which
11it was purchased, for a valuable consideration: Provided that
12the property purchased is deemed to be purchased for the
13purpose of resale, despite first being used, to the extent to
14which it is resold as an ingredient of an intentionally
15produced product or byproduct of manufacturing. For this
16purpose, slag produced as an incident to manufacturing pig
17iron or steel and sold is considered to be an intentionally
18produced byproduct of manufacturing. Transactions whereby the
19possession of the property is transferred but the seller
20retains the title as security for payment of the selling price
21shall be deemed to be sales.
22    "Sale at retail" shall be construed to include any
23transfer of the ownership of or title to tangible personal
24property to a purchaser, for use or consumption by any other

 

 

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1person to whom such purchaser may transfer the tangible
2personal property without a valuable consideration, and to
3include any transfer, whether made for or without a valuable
4consideration, for resale in any form as tangible personal
5property unless made in compliance with Section 2c of this
6Act.
7    Sales of tangible personal property, which property, to
8the extent not first subjected to a use for which it was
9purchased, as an ingredient or constituent, goes into and
10forms a part of tangible personal property subsequently the
11subject of a "Sale at retail", are not sales at retail as
12defined in this Act: Provided that the property purchased is
13deemed to be purchased for the purpose of resale, despite
14first being used, to the extent to which it is resold as an
15ingredient of an intentionally produced product or byproduct
16of manufacturing.
17    "Sale at retail" shall be construed to include any
18Illinois florist's sales transaction in which the purchase
19order is received in Illinois by a florist and the sale is for
20use or consumption, but the Illinois florist has a florist in
21another state deliver the property to the purchaser or the
22purchaser's donee in such other state.
23    Nonreusable tangible personal property that is used by
24persons engaged in the business of operating a restaurant,
25cafeteria, or drive-in is a sale for resale when it is
26transferred to customers in the ordinary course of business as

 

 

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1part of the sale of food or beverages and is used to deliver,
2package, or consume food or beverages, regardless of where
3consumption of the food or beverages occurs. Examples of those
4items include, but are not limited to nonreusable, paper and
5plastic cups, plates, baskets, boxes, sleeves, buckets or
6other containers, utensils, straws, placemats, napkins, doggie
7bags, and wrapping or packaging materials that are transferred
8to customers as part of the sale of food or beverages in the
9ordinary course of business.
10    The purchase, employment and transfer of such tangible
11personal property as newsprint and ink for the primary purpose
12of conveying news (with or without other information) is not a
13purchase, use or sale of tangible personal property.
14    A person whose activities are organized and conducted
15primarily as a not-for-profit service enterprise, and who
16engages in selling tangible personal property at retail
17(whether to the public or merely to members and their guests)
18is engaged in the business of selling tangible personal
19property at retail with respect to such transactions,
20excepting only a person organized and operated exclusively for
21charitable, religious or educational purposes either (1), to
22the extent of sales by such person to its members, students,
23patients or inmates of tangible personal property to be used
24primarily for the purposes of such person, or (2), to the
25extent of sales by such person of tangible personal property
26which is not sold or offered for sale by persons organized for

 

 

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1profit. The selling of school books and school supplies by
2schools at retail to students is not "primarily for the
3purposes of" the school which does such selling. The
4provisions of this paragraph shall not apply to nor subject to
5taxation occasional dinners, socials or similar activities of
6a person organized and operated exclusively for charitable,
7religious or educational purposes, whether or not such
8activities are open to the public.
9    A person who is the recipient of a grant or contract under
10Title VII of the Older Americans Act of 1965 (P.L. 92-258) and
11serves meals to participants in the federal Nutrition Program
12for the Elderly in return for contributions established in
13amount by the individual participant pursuant to a schedule of
14suggested fees as provided for in the federal Act is not
15engaged in the business of selling tangible personal property
16at retail with respect to such transactions.
17    "Purchaser" means anyone who, through a sale at retail,
18acquires the ownership of or title to tangible personal
19property for a valuable consideration.
20    "Reseller of motor fuel" means any person engaged in the
21business of selling or delivering or transferring title of
22motor fuel to another person other than for use or
23consumption. No person shall act as a reseller of motor fuel
24within this State without first being registered as a reseller
25pursuant to Section 2c or a retailer pursuant to Section 2a.
26    "Selling price" or the "amount of sale" means the

 

 

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1consideration for a sale valued in money whether received in
2money or otherwise, including cash, credits, property, other
3than as hereinafter provided, and services, but, prior to
4January 1, 2020 and beginning again 120 days after the
5effective date of this amendatory Act of the 102nd General
6Assembly, not including the value of or credit given for
7traded-in tangible personal property where the item that is
8traded-in is of like kind and character as that which is being
9sold; beginning January 1, 2020 and until 120 days after the
10effective date of this amendatory Act of the 102nd General
11Assembly, "selling price" includes the portion of the value of
12or credit given for traded-in motor vehicles of the First
13Division as defined in Section 1-146 of the Illinois Vehicle
14Code of like kind and character as that which is being sold
15that exceeds $10,000. "Selling price" shall be determined
16without any deduction on account of the cost of the property
17sold, the cost of materials used, labor or service cost or any
18other expense whatsoever, but does not include charges that
19are added to prices by sellers on account of the seller's tax
20liability under this Act, or on account of the seller's duty to
21collect, from the purchaser, the tax that is imposed by the Use
22Tax Act, or, except as otherwise provided with respect to any
23cigarette tax imposed by a home rule unit, on account of the
24seller's tax liability under any local occupation tax
25administered by the Department, or, except as otherwise
26provided with respect to any cigarette tax imposed by a home

 

 

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1rule unit on account of the seller's duty to collect, from the
2purchasers, the tax that is imposed under any local use tax
3administered by the Department. Effective December 1, 1985,
4"selling price" shall include charges that are added to prices
5by sellers on account of the seller's tax liability under the
6Cigarette Tax Act, on account of the sellers' duty to collect,
7from the purchaser, the tax imposed under the Cigarette Use
8Tax Act, and on account of the seller's duty to collect, from
9the purchaser, any cigarette tax imposed by a home rule unit.
10    Notwithstanding any law to the contrary, for any motor
11vehicle, as defined in Section 1-146 of the Vehicle Code, that
12is sold on or after January 1, 2015 for the purpose of leasing
13the vehicle for a defined period that is longer than one year
14and (1) is a motor vehicle of the second division that: (A) is
15a self-contained motor vehicle designed or permanently
16converted to provide living quarters for recreational,
17camping, or travel use, with direct walk through access to the
18living quarters from the driver's seat; (B) is of the van
19configuration designed for the transportation of not less than
207 nor more than 16 passengers; or (C) has a gross vehicle
21weight rating of 8,000 pounds or less or (2) is a motor vehicle
22of the first division, "selling price" or "amount of sale"
23means the consideration received by the lessor pursuant to the
24lease contract, including amounts due at lease signing and all
25monthly or other regular payments charged over the term of the
26lease. Also included in the selling price is any amount

 

 

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1received by the lessor from the lessee for the leased vehicle
2that is not calculated at the time the lease is executed,
3including, but not limited to, excess mileage charges and
4charges for excess wear and tear. For sales that occur in
5Illinois, with respect to any amount received by the lessor
6from the lessee for the leased vehicle that is not calculated
7at the time the lease is executed, the lessor who purchased the
8motor vehicle does not incur the tax imposed by the Use Tax Act
9on those amounts, and the retailer who makes the retail sale of
10the motor vehicle to the lessor is not required to collect the
11tax imposed by the Use Tax Act or to pay the tax imposed by
12this Act on those amounts. However, the lessor who purchased
13the motor vehicle assumes the liability for reporting and
14paying the tax on those amounts directly to the Department in
15the same form (Illinois Retailers' Occupation Tax, and local
16retailers' occupation taxes, if applicable) in which the
17retailer would have reported and paid such tax if the retailer
18had accounted for the tax to the Department. For amounts
19received by the lessor from the lessee that are not calculated
20at the time the lease is executed, the lessor must file the
21return and pay the tax to the Department by the due date
22otherwise required by this Act for returns other than
23transaction returns. If the retailer is entitled under this
24Act to a discount for collecting and remitting the tax imposed
25under this Act to the Department with respect to the sale of
26the motor vehicle to the lessor, then the right to the discount

 

 

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1provided in this Act shall be transferred to the lessor with
2respect to the tax paid by the lessor for any amount received
3by the lessor from the lessee for the leased vehicle that is
4not calculated at the time the lease is executed; provided
5that the discount is only allowed if the return is timely filed
6and for amounts timely paid. The "selling price" of a motor
7vehicle that is sold on or after January 1, 2015 for the
8purpose of leasing for a defined period of longer than one year
9shall not be reduced by the value of or credit given for
10traded-in tangible personal property owned by the lessor, nor
11shall it be reduced by the value of or credit given for
12traded-in tangible personal property owned by the lessee,
13regardless of whether the trade-in value thereof is assigned
14by the lessee to the lessor. In the case of a motor vehicle
15that is sold for the purpose of leasing for a defined period of
16longer than one year, the sale occurs at the time of the
17delivery of the vehicle, regardless of the due date of any
18lease payments. A lessor who incurs a Retailers' Occupation
19Tax liability on the sale of a motor vehicle coming off lease
20may not take a credit against that liability for the Use Tax
21the lessor paid upon the purchase of the motor vehicle (or for
22any tax the lessor paid with respect to any amount received by
23the lessor from the lessee for the leased vehicle that was not
24calculated at the time the lease was executed) if the selling
25price of the motor vehicle at the time of purchase was
26calculated using the definition of "selling price" as defined

 

 

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1in this paragraph. Notwithstanding any other provision of this
2Act to the contrary, lessors shall file all returns and make
3all payments required under this paragraph to the Department
4by electronic means in the manner and form as required by the
5Department. This paragraph does not apply to leases of motor
6vehicles for which, at the time the lease is entered into, the
7term of the lease is not a defined period, including leases
8with a defined initial period with the option to continue the
9lease on a month-to-month or other basis beyond the initial
10defined period.
11    The phrase "like kind and character" shall be liberally
12construed (including but not limited to any form of motor
13vehicle for any form of motor vehicle, or any kind of farm or
14agricultural implement for any other kind of farm or
15agricultural implement), while not including a kind of item
16which, if sold at retail by that retailer, would be exempt from
17retailers' occupation tax and use tax as an isolated or
18occasional sale.
19    "Gross receipts" from the sales of tangible personal
20property at retail means the total selling price or the amount
21of such sales, as hereinbefore defined. In the case of charge
22and time sales, the amount thereof shall be included only as
23and when payments are received by the seller. Receipts or
24other consideration derived by a seller from the sale,
25transfer or assignment of accounts receivable to a wholly
26owned subsidiary will not be deemed payments prior to the time

 

 

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1the purchaser makes payment on such accounts.
2    "Department" means the Department of Revenue.
3    "Person" means any natural individual, firm, partnership,
4association, joint stock company, joint adventure, public or
5private corporation, limited liability company, or a receiver,
6executor, trustee, guardian or other representative appointed
7by order of any court.
8    The isolated or occasional sale of tangible personal
9property at retail by a person who does not hold himself out as
10being engaged (or who does not habitually engage) in selling
11such tangible personal property at retail, or a sale through a
12bulk vending machine, does not constitute engaging in a
13business of selling such tangible personal property at retail
14within the meaning of this Act; provided that any person who is
15engaged in a business which is not subject to the tax imposed
16by this Act because of involving the sale of or a contract to
17sell real estate or a construction contract to improve real
18estate or a construction contract to engineer, install, and
19maintain an integrated system of products, but who, in the
20course of conducting such business, transfers tangible
21personal property to users or consumers in the finished form
22in which it was purchased, and which does not become real
23estate or was not engineered and installed, under any
24provision of a construction contract or real estate sale or
25real estate sales agreement entered into with some other
26person arising out of or because of such nontaxable business,

 

 

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1is engaged in the business of selling tangible personal
2property at retail to the extent of the value of the tangible
3personal property so transferred. If, in such a transaction, a
4separate charge is made for the tangible personal property so
5transferred, the value of such property, for the purpose of
6this Act, shall be the amount so separately charged, but not
7less than the cost of such property to the transferor; if no
8separate charge is made, the value of such property, for the
9purposes of this Act, is the cost to the transferor of such
10tangible personal property. Construction contracts for the
11improvement of real estate consisting of engineering,
12installation, and maintenance of voice, data, video, security,
13and all telecommunication systems do not constitute engaging
14in a business of selling tangible personal property at retail
15within the meaning of this Act if they are sold at one
16specified contract price.
17    A person who holds himself or herself out as being engaged
18(or who habitually engages) in selling tangible personal
19property at retail is a person engaged in the business of
20selling tangible personal property at retail hereunder with
21respect to such sales (and not primarily in a service
22occupation) notwithstanding the fact that such person designs
23and produces such tangible personal property on special order
24for the purchaser and in such a way as to render the property
25of value only to such purchaser, if such tangible personal
26property so produced on special order serves substantially the

 

 

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1same function as stock or standard items of tangible personal
2property that are sold at retail.
3    Persons who engage in the business of transferring
4tangible personal property upon the redemption of trading
5stamps are engaged in the business of selling such property at
6retail and shall be liable for and shall pay the tax imposed by
7this Act on the basis of the retail value of the property
8transferred upon redemption of such stamps.
9    "Bulk vending machine" means a vending machine, containing
10unsorted confections, nuts, toys, or other items designed
11primarily to be used or played with by children which, when a
12coin or coins of a denomination not larger than $0.50 are
13inserted, are dispensed in equal portions, at random and
14without selection by the customer.
15    "Remote retailer" means a retailer that does not maintain
16within this State, directly or by a subsidiary, an office,
17distribution house, sales house, warehouse or other place of
18business, or any agent or other representative operating
19within this State under the authority of the retailer or its
20subsidiary, irrespective of whether such place of business or
21agent is located here permanently or temporarily or whether
22such retailer or subsidiary is licensed to do business in this
23State.
24    "Marketplace" means a physical or electronic place, forum,
25platform, application, or other method by which a marketplace
26seller sells or offers to sell items.

 

 

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1    "Marketplace facilitator" means a person who, pursuant to
2an agreement with an unrelated third-party marketplace seller,
3directly or indirectly through one or more affiliates
4facilitates a retail sale by an unrelated third party
5marketplace seller by:
6        (1) listing or advertising for sale by the marketplace
7    seller in a marketplace, tangible personal property that
8    is subject to tax under this Act; and
9        (2) either directly or indirectly, through agreements
10    or arrangements with third parties, collecting payment
11    from the customer and transmitting that payment to the
12    marketplace seller regardless of whether the marketplace
13    facilitator receives compensation or other consideration
14    in exchange for its services.
15    A person who provides advertising services, including
16listing products for sale, is not considered a marketplace
17facilitator, so long as the advertising service platform or
18forum does not engage, directly or indirectly through one or
19more affiliated persons, in the activities described in
20paragraph (2) of this definition of "marketplace facilitator".
21    "Marketplace seller" means a person that makes sales
22through a marketplace operated by an unrelated third party
23marketplace facilitator.
24(Source: P.A. 101-31, eff. 6-28-19; 101-604, eff. 1-1-20.)
 
25    Section 15. The Illinois Vehicle Code is amended by

 

 

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1changing Section 3-1001 as follows:
 
2    (625 ILCS 5/3-1001)  (from Ch. 95 1/2, par. 3-1001)
3    Sec. 3-1001. A tax is hereby imposed on the privilege of
4using, in this State, any motor vehicle as defined in Section
51-146 of this Code acquired by gift, transfer, or purchase,
6and having a year model designation preceding the year of
7application for title by 5 or fewer years prior to October 1,
81985 and 10 or fewer years on and after October 1, 1985 and
9prior to January 1, 1988. On and after January 1, 1988, the tax
10shall apply to all motor vehicles without regard to model
11year. Except that the tax shall not apply
12        (i) if the use of the motor vehicle is otherwise taxed
13    under the Use Tax Act;
14        (ii) if the motor vehicle is bought and used by a
15    governmental agency or a society, association, foundation
16    or institution organized and operated exclusively for
17    charitable, religious or educational purposes;
18        (iii) if the use of the motor vehicle is not subject to
19    the Use Tax Act by reason of subsection (a), (b), (c), (d),
20    (e) or (f) of Section 3-55 of that Act dealing with the
21    prevention of actual or likely multistate taxation;
22        (iv) to implements of husbandry;
23        (v) when a junking certificate is issued pursuant to
24    Section 3-117(a) of this Code;
25        (vi) when a vehicle is subject to the replacement

 

 

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1    vehicle tax imposed by Section 3-2001 of this Act;
2        (vii) when the transfer is a gift to a beneficiary in
3    the administration of an estate and the beneficiary is a
4    surviving spouse.
5    Prior to January 1, 1988, the rate of tax shall be 5% of
6the selling price for each purchase of a motor vehicle covered
7by Section 3-1001 of this Code. Except as hereinafter
8provided, beginning January 1, 1988 and until 120 days after
9the effective date of this amendatory Act of the 102nd General
10Assembly, the rate of tax shall be as follows for transactions
11in which the selling price of the motor vehicle is less than
12$15,000:
13Number of Years Transpired AfterApplicable Tax
14Model Year of Motor Vehicle
151 or less$390
162290
173215
184165
195115
20690
21780
22865
23950
241040
25over 1025
26Except as hereinafter provided, beginning January 1, 1988 and

 

 

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1until 120 days after the effective date of this amendatory Act
2of the 102nd General Assembly, the rate of tax shall be as
3follows for transactions in which the selling price of the
4motor vehicle is $15,000 or more:
5Selling PriceApplicable Tax
6$15,000 - $19,999$ 750
7$20,000 - $24,999$1,000
8$25,000 - $29,999$1,250
9$30,000 and over$1,500
10    Except as hereinafter provided, beginning 120 days after
11the effective date of this amendatory Act of the 102nd General
12Assembly, the rate of tax shall be as follows for transactions
13in which the selling price of the motor vehicle is less than
14$15,000:
15        (1) if one year or less has transpired after the model
16    year of the vehicle, then the applicable tax is $465;
17        (2) if 2 years have transpired after the model year of
18    the motor vehicle, then the applicable tax is $365;
19        (3) if 3 years have transpired after the model year of
20    the motor vehicle, then the applicable tax is $290;
21        (4) if 4 years have transpired after the model year of
22    the motor vehicle, then the applicable tax is $240;
23        (5) if 5 years have transpired after the model year of
24    the motor vehicle, then the applicable tax is $190;
25        (6) if 6 years have transpired after the model year of
26    the motor vehicle, then the applicable tax is $165;

 

 

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1        (7) if 7 years have transpired after the model year of
2    the motor vehicle, then the applicable tax is $155;
3        (8) if 8 years have transpired after the model year of
4    the motor vehicle, then the applicable tax is $140;
5        (9) if 9 years have transpired after the model year of
6    the motor vehicle, then the applicable tax is $125;
7        (10) if 10 years have transpired after the model year
8    of the motor vehicle, then the applicable tax is $115; and
9        (11) if more than 10 years have transpired after the
10    model year of the motor vehicle, then the applicable tax
11    is $100.
12    Except as hereinafter provided, beginning 120 days after
13the effective date of this amendatory Act of the 102nd General
14Assembly, the rate of tax shall be as follows for transactions
15in which the selling price of the motor vehicle is $15,000 or
16more:
17        (1) if the selling price is $15,000 or more, but less
18    than $20,000, then the applicable tax shall be $850;
19        (2) if the selling price is $20,000 or more, but less
20    than $25,000, then the applicable tax shall be $1,100;
21        (3) if the selling price is $25,000 or more, but less
22    than $30,000, then the applicable tax shall be $1,350;
23        (4) if the selling price is $30,000 or more, but less
24    than $50,000, then the applicable tax shall be $1,600;
25        (5) if the selling price is $50,000 or more, but less
26    than $100,000, then the applicable tax shall be $2,600;

 

 

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1        (6) if the selling price is $100,000 or more, but less
2    than $1,000,000, then the applicable tax shall be $5,100;
3    and
4        (7) if the selling price is $1,000,000 or more, then
5    the applicable tax shall be $10,100.
6For the following transactions, the tax rate shall be $15 for
7each motor vehicle acquired in such transaction:
8        (i) when the transferee or purchaser is the spouse,
9    mother, father, brother, sister or child of the
10    transferor;
11        (ii) when the transfer is a gift to a beneficiary in
12    the administration of an estate and the beneficiary is not
13    a surviving spouse;
14        (iii) when a motor vehicle which has once been
15    subjected to the Illinois retailers' occupation tax or use
16    tax is transferred in connection with the organization,
17    reorganization, dissolution or partial liquidation of an
18    incorporated or unincorporated business wherein the
19    beneficial ownership is not changed.
20    A claim that the transaction is taxable under subparagraph
21(i) shall be supported by such proof of family relationship as
22provided by rules of the Department.
23    For a transaction in which a motorcycle, motor driven
24cycle or moped is acquired the tax rate shall be $25.
25    On and after October 1, 1985 and until the first day of the
26first month to begin not less than 120 days after the effective

 

 

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1date of this amendatory Act of the 102nd General Assembly,
21/12 of $5,000,000 of the moneys received by the Department of
3Revenue pursuant to this Section shall be paid each month into
4the Build Illinois Fund; on and after the first day of the
5first month to begin not less than 120 days after the effective
6date of this amendatory Act of the 102nd General Assembly,
71/12 of $40,000,000 of the moneys received by the Department
8of Revenue pursuant to this Section shall be paid each month
9into the Build Illinois Fund; and the remainder shall be paid
10into the General Revenue Fund.
11    The tax imposed by this Section shall be abated and no
12longer imposed when the amount deposited to secure the bonds
13issued pursuant to the Build Illinois Bond Act is sufficient
14to provide for the payment of the principal of, and interest
15and premium, if any, on the bonds, as certified to the State
16Comptroller and the Director of Revenue by the Director of the
17Governor's Office of Management and Budget.
18(Source: P.A. 96-554, eff. 1-1-10.)
 
19    Section 99. Effective date. This Act takes effect upon
20becoming law.