SB0455 95TH GENERAL ASSEMBLY

LRB095 03744 BDD 23773 b

95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
SB0455

Introduced 2/8/2007, by Sen. James F. Clayborne, Jr. - William R. Haine

SYNOPSIS AS INTRODUCED:

35 ILCS 105/3-6 new
35 ILCS 110/3-6 new
35 ILCS 115/3-6 new
35 ILCS 120/2-5.6 new

Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Exempts the use or sale of certain aircraft and aircraft parts and materials. Provides that the sunset provisions under the Acts do not apply to these exemptions. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Use Tax Act is amended by adding Section 3-6 as follows:

(35 ILCS 105/3-6 new)

Sec. 3-6. Exemptions for certain aircraft, parts, and materials.

(a) Beginning on July 1, 2007, no tax is imposed under this Act on the use of the following items by a domestic air carrier:

(1) an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers; and

(2) parts and materials, excluding shop equipment and fuel, affixed or to be affixed to an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers.

(b) Beginning on July 1, 2007, no tax is imposed under this Act on the use of parts and materials, excluding shop equipment and fuel, that are affixed to an aircraft that meets all of the following conditions:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the parts or materials are affixed to the aircraft; and

(3) the aircraft is not based or registered in this State after the parts or materials are affixed to the aircraft.

(c) Beginning on July 1, 2007, no tax is imposed under this Act on the use of an aircraft that is temporarily located in this State for the purpose of a prepurchase evaluation or the purpose of a post-sale customization if all of the following conditions are met:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the prepurchase evaluation or post-sale customization; and

(3) the aircraft is not based or registered in this State after the prepurchase evaluation or post-sale customization.

(d) Beginning on July 1, 2007, no tax is imposed under this Act on the use of an aircraft that is sold to a person for a subsequent lease to a domestic air carrier that is operating under a certificate issued by the Federal Aviation Administration under 14 C.F.R. 121 and that will use the aircraft solely in the regularly-scheduled transport of passengers.

(e) For the purposes of this Section:

"Based in this State" means hangared or stored in Illinois for not less than 10 days in not less than 3 nonconsecutive months during the immediately preceding period.

"Domestic air carrier" means only those entities that are engaged primarily, as a business activity, in the commercial transport for hire of air cargo, passengers, or a combination of air cargo and passengers.

"Prepurchase evaluation" means an examination of an aircraft to provide a potential purchaser with information relevant to the potential purchase.

"Post-sale customization" means an improvement, maintenance, or repair that is performed on an aircraft following a transfer of ownership of the aircraft.

(f) This Section is exempt from the provisions of Section 3-90.

Section 10. The Service Use Tax Act is amended by adding Section 3-6 as follows:

(35 ILCS 110/3-6 new)

Sec. 3-6. Exemptions for certain aircraft, parts, and materials.

(a) Beginning on July 1, 2007, no tax is imposed under this Act on the use of the following items by a domestic air carrier:

(1) an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers; and

(2) parts and materials, excluding shop equipment and fuel, affixed or to be affixed to an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers.

(b) Beginning on July 1, 2007, no tax is imposed under this Act on the use of parts and materials, excluding shop equipment and fuel, that are affixed to an aircraft that meets all of the following conditions:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the parts or materials are affixed to the aircraft; and

(3) the aircraft is not based or registered in this State after the parts or materials are affixed to the aircraft.

(c) Beginning on July 1, 2007, no tax is imposed under this Act on the use of an aircraft that is temporarily located in this State for the purpose of a prepurchase evaluation or the purpose of a post-sale customization if all of the following conditions are met:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the prepurchase evaluation or post-sale customization; and

(3) the aircraft is not based or registered in this State after the prepurchase evaluation or post-sale customization.

(d) Beginning on July 1, 2007, no tax is imposed under this Act on the use of an aircraft that is sold to a person for a subsequent lease to a domestic air carrier that is operating under a certificate issued by the Federal Aviation Administration under 14 C.F.R. 121 and that will use the aircraft solely in the regularly-scheduled transport of passengers.

(e) For the purposes of this Section:

"Based in this State" means hangared or stored in Illinois for not less than 10 days in not less than 3 nonconsecutive months during the immediately preceding period.

"Domestic air carrier" means only those entities that are engaged primarily, as a business activity, in the commercial transport for hire of air cargo, passengers, or a combination of air cargo and passengers.

"Prepurchase evaluation" means an examination of an aircraft to provide a potential purchaser with information relevant to the potential purchase.

"Post-sale customization" means an improvement, maintenance, or repair that is performed on an aircraft following a transfer of ownership of the aircraft.

(f) This Section is exempt from the provisions of Section 3-75.

Section 15. The Service Occupation Tax Act is amended by adding Section 3-6 as follows:

(35 ILCS 115/3-6 new)

Sec. 3-6. Exemptions for certain aircraft, parts, and materials.

(a) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of the following items by a domestic air carrier:

(1) an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers; and

(2) parts and materials, excluding shop equipment and fuel, affixed or to be affixed to an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers.

(b) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of parts and materials, excluding shop equipment and fuel, that are affixed to an aircraft that meets all of the following conditions:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the parts or materials are affixed to the aircraft; and

(3) the aircraft is not based or registered in this State after the parts or materials are affixed to the aircraft.

(c) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of an aircraft that is temporarily located in this State for the purpose of a prepurchase evaluation or the purpose of a post-sale customization if all of the following conditions are met:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the prepurchase evaluation or post-sale customization; and

(3) the aircraft is not based or registered in this State after the prepurchase evaluation or post-sale customization.

(d) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of an aircraft that is sold to a person for a subsequent lease to a domestic air carrier that is operating under a certificate issued by the Federal Aviation Administration under 14 C.F.R. 121 and that will use the aircraft solely in the regularly-scheduled transport of passengers.

(e) For the purposes of this Section:

"Based in this State" means hangared or stored in Illinois for not less than 10 days in not less than 3 nonconsecutive months during the immediately preceding period.

"Domestic air carrier" means only those entities that are engaged primarily, as a business activity, in the commercial transport for hire of air cargo, passengers, or a combination of air cargo and passengers.

"Prepurchase evaluation" means an examination of an aircraft to provide a potential purchaser with information relevant to the potential purchase.

"Post-sale customization" means an improvement, maintenance, or repair that is performed on an aircraft following a transfer of ownership of the aircraft.

(f) This Section is exempt from the provisions of Section 3-55.

Section 20. The Retailers' Occupation Tax Act is amended by adding Section 2-5.6 as follows:

(35 ILCS 120/2-5.6 new)

Sec. 2-5.6. Exemptions for certain aircraft, parts, and materials.

(a) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of the following items by a domestic air carrier:

(1) an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers; and

(2) parts and materials, excluding shop equipment and fuel, affixed or to be affixed to an aircraft that has a maximum certificated takeoff weight of at least 6,000 pounds that is used solely in the transport of air cargo, passengers, or a combination of air cargo and passengers.

(b) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of parts and materials, excluding shop equipment and fuel, that are affixed to an aircraft that meets all of the following conditions:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the parts or materials are affixed to the aircraft; and

(3) the aircraft is not based or registered in this State after the parts or materials are affixed to the aircraft.

(c) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of an aircraft that is temporarily located in this State for the purpose of a prepurchase evaluation or the purpose of a post-sale customization if all of the following conditions are met:

(1) the aircraft leaves the State within 15 days after the occurrence of the sooner of (i) the issuance of the finial billing or (ii) the authorized approval for final return to service, completion of the maintenance record entry, and completion of the test flight and ground test for inspection, as required by 14 C.F.R. 91.407;

(2) the aircraft is not based or registered in this State before the prepurchase evaluation or post-sale customization; and

(3) the aircraft is not based or registered in this State after the prepurchase evaluation or post-sale customization.

(d) Beginning on July 1, 2007, no tax is imposed under this Act on the sale of an aircraft that is sold to a person for a subsequent lease to a domestic air carrier that is operating under a certificate issued by the Federal Aviation Administration under 14 C.F.R. 121 and that will use the aircraft solely in the regularly-scheduled transport of passengers.

(e) For the purposes of this Section:

"Based in this State" means hangared or stored in Illinois for not less than 10 days in not less than 3 nonconsecutive months during the immediately preceding period.

"Domestic air carrier" means only those entities that are engaged primarily, as a business activity, in the commercial transport for hire of air cargo, passengers, or a combination of air cargo and passengers.

"Prepurchase evaluation" means an examination of an aircraft to provide a potential purchaser with information relevant to the potential purchase.

"Post-sale customization" means an improvement, maintenance, or repair that is performed on an aircraft following a transfer of ownership of the aircraft.

(f) This Section is exempt from the provisions of Section 2-70.

Section 99. Effective date. This Act takes effect upon becoming law.