103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
SB2553

 

Introduced 3/23/2023, by Sen. Michael W. Halpin

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 145/3  from Ch. 120, par. 481b.33
35 ILCS 145/9  from Ch. 120, par. 481b.39

    Amends the Hotel Operators' Occupation Tax Act. Creates an exemption for gross rental receipts received by a hotel operator when renting, leasing, or letting rooms to an entity that (i) is organized and operated exclusively for charitable, religious, or educational purposes, (ii) possess an active Exemption Identification Number issued by the Department of Revenue pursuant to the Retailers' Occupation Tax Act, and (iii) rents the room in furtherance of the purposes for which the charitable, religious, or educational entity is organized. Effective immediately.


LRB103 31572 HLH 59731 b

 

 

A BILL FOR

 

SB2553LRB103 31572 HLH 59731 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 Hotel Operators' Occupation Tax Act is
5amended by changing Sections 3 and 9 as follows:
 
6    (35 ILCS 145/3)  (from Ch. 120, par. 481b.33)
7    Sec. 3. Rate; exemptions.
8    (a) A tax is imposed upon persons engaged in the business
9of renting, leasing or letting rooms in a hotel at the rate of
105% of 94% of the gross rental receipts from such renting,
11leasing or letting, excluding, however, from gross rental
12receipts, the proceeds of such renting, leasing or letting to
13permanent residents of that hotel and proceeds from the tax
14imposed under subsection (c) of Section 13 of the Metropolitan
15Pier and Exposition Authority Act.
16    (b) There shall be imposed an additional tax upon persons
17engaged in the business of renting, leasing or letting rooms
18in a hotel at the rate of 1% of 94% of the gross rental
19receipts from such renting, leasing or letting, excluding,
20however, from gross rental receipts, the proceeds of such
21renting, leasing or letting to permanent residents of that
22hotel and proceeds from the tax imposed under subsection (c)
23of Section 13 of the Metropolitan Pier and Exposition

 

 

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1Authority Act.
2    (c) No funds received pursuant to this Act shall be used to
3advertise for or otherwise promote new competition in the
4hotel business.
5    (d) However, such tax is not imposed upon the privilege of
6engaging in any business in Interstate Commerce or otherwise,
7which business may not, under the Constitution and Statutes of
8the United States, be made the subject of taxation by this
9State. In addition, the tax is not imposed upon gross rental
10receipts for which the hotel operator is prohibited from
11obtaining reimbursement for the tax from the customer by
12reason of a federal treaty.
13    (d-5) On and after July 1, 2017 and before January 1, 2024,
14the tax imposed by this Act shall not apply to gross rental
15receipts received by an entity that is organized and operated
16exclusively for religious purposes and possesses an active
17Exemption Identification Number issued by the Department
18pursuant to the Retailers' Occupation Tax Act when acting as a
19hotel operator renting, leasing, or letting rooms:
20        (1) in furtherance of the purposes for which it is
21    organized; or
22        (2) to entities that (i) are organized and operated
23    exclusively for religious purposes, (ii) possess an active
24    Exemption Identification Number issued by the Department
25    pursuant to the Retailers' Occupation Tax Act, and (iii)
26    rent the rooms in furtherance of the purposes for which

 

 

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1    they are organized.
2    No gross rental receipts are exempt under paragraph (2) of
3this subsection (d-5) unless the hotel operator obtains the
4active Exemption Identification Number from the exclusively
5religious entity to whom it is renting and maintains that
6number in its books and records. Gross rental receipts from
7all rentals other than those described in items (1) or (2) of
8this subsection (d-5) are subject to the tax imposed by this
9Act unless otherwise exempt under this Act.
10    On and after January 1, 2024, the tax imposed by this Act
11shall not apply to gross rental receipts received by an entity
12that is organized and operated exclusively for religious
13purposes and possesses an active Exemption Identification
14Number issued by the Department pursuant to the Retailers'
15Occupation Tax Act when the religious entity is acting as a
16hotel operator and is renting, leasing, or letting rooms in
17furtherance of the purposes for which the religious entity is
18organized.
19    This subsection (d-5) is exempt from the sunset provisions
20of Section 3-5 of this Act.
21    (d-10) On and after January 1, 2024, the tax imposed by
22this Act shall not apply to gross rental receipts received by a
23hotel operator when renting, leasing, or letting rooms to an
24entity that (i) is organized and operated exclusively for
25charitable, religious, or educational purposes, (ii) possess
26an active Exemption Identification Number issued by the

 

 

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1Department pursuant to the Retailers' Occupation Tax Act, and
2(iii) rents the room in furtherance of the purposes for which
3the charitable, religious, or educational entity is organized.
4The gross rental receipts are not exempt under this subsection
5(d-10) unless the hotel operator obtains the active Exemption
6Identification Number from the charitable, religious, or
7educational entity to which it is renting the room and
8maintains that number in its books and records. This
9subsection (d-10) is exempt from the sunset provisions of
10Section 3-5 of this Act.
11    (e) Persons subject to the tax imposed by this Act may
12reimburse themselves for their tax liability under this Act by
13separately stating such tax as an additional charge, which
14charge may be stated in combination, in a single amount, with
15any tax imposed pursuant to Sections 8-3-13 and 8-3-14 of the
16Illinois Municipal Code, and Section 25.05-10 of "An Act to
17revise the law in relation to counties".
18    (f) If any hotel operator collects an amount (however
19designated) which purports to reimburse such operator for
20hotel operators' occupation tax liability measured by receipts
21which are not subject to hotel operators' occupation tax, or
22if any hotel operator, in collecting an amount (however
23designated) which purports to reimburse such operator for
24hotel operators' occupation tax liability measured by receipts
25which are subject to tax under this Act, collects more from the
26customer than the operators' hotel operators' occupation tax

 

 

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1liability in the transaction is, the customer shall have a
2legal right to claim a refund of such amount from such
3operator. However, if such amount is not refunded to the
4customer for any reason, the hotel operator is liable to pay
5such amount to the Department.
6(Source: P.A. 100-213, eff. 8-18-17.)
 
7    (35 ILCS 145/9)  (from Ch. 120, par. 481b.39)
8    Sec. 9. Applicability. Persons engaged in the business of
9renting, leasing or letting rooms in a hotel only to permanent
10residents are exempt from the provisions of this Act. In
11addition, persons engaged in the business of renting, leasing,
12or letting rooms in a hotel whose only rentals are as described
13in subsections (d-5) and (d-10) items (1) and (2) of
14subsection (d-5) of Section 3 of this Act are exempt from the
15provisions of this Act.
16(Source: P.A. 100-213, eff. 8-18-17.)
 
17    Section 99. Effective date. This Act takes effect upon
18becoming law.