Illinois General Assembly - Full Text of HB5316
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Full Text of HB5316  100th General Assembly

HB5316 100TH GENERAL ASSEMBLY

  
  

 


 
100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB5316

 

Introduced , by Rep. Jerry Costello, II

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-5
35 ILCS 110/3-5
35 ILCS 115/3-5
35 ILCS 120/2-5

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that the exemption for coal and aggregate exploration, mining, off-highway hauling, processing, maintenance, and reclamation equipment is exempt from the Acts' automatic sunset provisions. Effective immediately.


LRB100 16845 HLH 31986 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB5316LRB100 16845 HLH 31986 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
53-5 as follows:
 
6    (35 ILCS 105/3-5)
7    Sec. 3-5. Exemptions. Use of the following tangible
8personal property is exempt from the tax imposed by this Act:
9    (1) Personal property purchased from a corporation,
10society, association, foundation, institution, or
11organization, other than a limited liability company, that is
12organized and operated as a not-for-profit service enterprise
13for the benefit of persons 65 years of age or older if the
14personal property was not purchased by the enterprise for the
15purpose of resale by the enterprise.
16    (2) Personal property purchased by a not-for-profit
17Illinois county fair association for use in conducting,
18operating, or promoting the county fair.
19    (3) Personal property purchased by a not-for-profit arts or
20cultural organization that establishes, by proof required by
21the Department by rule, that it has received an exemption under
22Section 501(c)(3) of the Internal Revenue Code and that is
23organized and operated primarily for the presentation or

 

 

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1support of arts or cultural programming, activities, or
2services. These organizations include, but are not limited to,
3music and dramatic arts organizations such as symphony
4orchestras and theatrical groups, arts and cultural service
5organizations, local arts councils, visual arts organizations,
6and media arts organizations. On and after July 1, 2001 (the
7effective date of Public Act 92-35) this amendatory Act of the
892nd General Assembly, however, an entity otherwise eligible
9for this exemption shall not make tax-free purchases unless it
10has an active identification number issued by the Department.
11    (4) Personal property purchased by a governmental body, by
12a corporation, society, association, foundation, or
13institution organized and operated exclusively for charitable,
14religious, or educational purposes, or by a not-for-profit
15corporation, society, association, foundation, institution, or
16organization that has no compensated officers or employees and
17that is organized and operated primarily for the recreation of
18persons 55 years of age or older. A limited liability company
19may qualify for the exemption under this paragraph only if the
20limited liability company is organized and operated
21exclusively for educational purposes. On and after July 1,
221987, however, no entity otherwise eligible for this exemption
23shall make tax-free purchases unless it has an active exemption
24identification number issued by the Department.
25    (5) Until July 1, 2003, a passenger car that is a
26replacement vehicle to the extent that the purchase price of

 

 

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1the car is subject to the Replacement Vehicle Tax.
2    (6) Until July 1, 2003 and beginning again on September 1,
32004 through August 30, 2014, graphic arts machinery and
4equipment, including repair and replacement parts, both new and
5used, and including that manufactured on special order,
6certified by the purchaser to be used primarily for graphic
7arts production, and including machinery and equipment
8purchased for lease. Equipment includes chemicals or chemicals
9acting as catalysts but only if the chemicals or chemicals
10acting as catalysts effect a direct and immediate change upon a
11graphic arts product. Beginning on July 1, 2017, graphic arts
12machinery and equipment is included in the manufacturing and
13assembling machinery and equipment exemption under paragraph
14(18).
15    (7) Farm chemicals.
16    (8) Legal tender, currency, medallions, or gold or silver
17coinage issued by the State of Illinois, the government of the
18United States of America, or the government of any foreign
19country, and bullion.
20    (9) Personal property purchased from a teacher-sponsored
21student organization affiliated with an elementary or
22secondary school located in Illinois.
23    (10) A motor vehicle that is used for automobile renting,
24as defined in the Automobile Renting Occupation and Use Tax
25Act.
26    (11) Farm machinery and equipment, both new and used,

 

 

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1including that manufactured on special order, certified by the
2purchaser to be used primarily for production agriculture or
3State or federal agricultural programs, including individual
4replacement parts for the machinery and equipment, including
5machinery and equipment purchased for lease, and including
6implements of husbandry defined in Section 1-130 of the
7Illinois Vehicle Code, farm machinery and agricultural
8chemical and fertilizer spreaders, and nurse wagons required to
9be registered under Section 3-809 of the Illinois Vehicle Code,
10but excluding other motor vehicles required to be registered
11under the Illinois Vehicle Code. Horticultural polyhouses or
12hoop houses used for propagating, growing, or overwintering
13plants shall be considered farm machinery and equipment under
14this item (11). Agricultural chemical tender tanks and dry
15boxes shall include units sold separately from a motor vehicle
16required to be licensed and units sold mounted on a motor
17vehicle required to be licensed if the selling price of the
18tender is separately stated.
19    Farm machinery and equipment shall include precision
20farming equipment that is installed or purchased to be
21installed on farm machinery and equipment including, but not
22limited to, tractors, harvesters, sprayers, planters, seeders,
23or spreaders. Precision farming equipment includes, but is not
24limited to, soil testing sensors, computers, monitors,
25software, global positioning and mapping systems, and other
26such equipment.

 

 

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1    Farm machinery and equipment also includes computers,
2sensors, software, and related equipment used primarily in the
3computer-assisted operation of production agriculture
4facilities, equipment, and activities such as, but not limited
5to, the collection, monitoring, and correlation of animal and
6crop data for the purpose of formulating animal diets and
7agricultural chemicals. This item (11) is exempt from the
8provisions of Section 3-90.
9    (12) Until June 30, 2013, fuel and petroleum products sold
10to or used by an air common carrier, certified by the carrier
11to be used for consumption, shipment, or storage in the conduct
12of its business as an air common carrier, for a flight destined
13for or returning from a location or locations outside the
14United States without regard to previous or subsequent domestic
15stopovers.
16    Beginning July 1, 2013, fuel and petroleum products sold to
17or used by an air carrier, certified by the carrier to be used
18for consumption, shipment, or storage in the conduct of its
19business as an air common carrier, for a flight that (i) is
20engaged in foreign trade or is engaged in trade between the
21United States and any of its possessions and (ii) transports at
22least one individual or package for hire from the city of
23origination to the city of final destination on the same
24aircraft, without regard to a change in the flight number of
25that aircraft.
26    (13) Proceeds of mandatory service charges separately

 

 

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1stated on customers' bills for the purchase and consumption of
2food and beverages purchased at retail from a retailer, to the
3extent that the proceeds of the service charge are in fact
4turned over as tips or as a substitute for tips to the
5employees who participate directly in preparing, serving,
6hosting or cleaning up the food or beverage function with
7respect to which the service charge is imposed.
8    (14) Until July 1, 2003, oil field exploration, drilling,
9and production equipment, including (i) rigs and parts of rigs,
10rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
11tubular goods, including casing and drill strings, (iii) pumps
12and pump-jack units, (iv) storage tanks and flow lines, (v) any
13individual replacement part for oil field exploration,
14drilling, and production equipment, and (vi) machinery and
15equipment purchased for lease; but excluding motor vehicles
16required to be registered under the Illinois Vehicle Code.
17    (15) Photoprocessing machinery and equipment, including
18repair and replacement parts, both new and used, including that
19manufactured on special order, certified by the purchaser to be
20used primarily for photoprocessing, and including
21photoprocessing machinery and equipment purchased for lease.
22    (16) Coal and aggregate exploration, mining, off-highway
23hauling, processing, maintenance, and reclamation equipment,
24including replacement parts and equipment, and including
25equipment purchased for lease, but excluding motor vehicles
26required to be registered under the Illinois Vehicle Code. The

 

 

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1changes made to this Section by Public Act 97-767 apply on and
2after July 1, 2003, but no claim for credit or refund is
3allowed on or after August 16, 2013 (the effective date of
4Public Act 98-456) for such taxes paid during the period
5beginning July 1, 2003 and ending on August 16, 2013 (the
6effective date of Public Act 98-456). This item (16) is exempt
7from the provisions of Section 3-90.
8    (17) Until July 1, 2003, distillation machinery and
9equipment, sold as a unit or kit, assembled or installed by the
10retailer, certified by the user to be used only for the
11production of ethyl alcohol that will be used for consumption
12as motor fuel or as a component of motor fuel for the personal
13use of the user, and not subject to sale or resale.
14    (18) Manufacturing and assembling machinery and equipment
15used primarily in the process of manufacturing or assembling
16tangible personal property for wholesale or retail sale or
17lease, whether that sale or lease is made directly by the
18manufacturer or by some other person, whether the materials
19used in the process are owned by the manufacturer or some other
20person, or whether that sale or lease is made apart from or as
21an incident to the seller's engaging in the service occupation
22of producing machines, tools, dies, jigs, patterns, gauges, or
23other similar items of no commercial value on special order for
24a particular purchaser. The exemption provided by this
25paragraph (18) does not include machinery and equipment used in
26(i) the generation of electricity for wholesale or retail sale;

 

 

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1(ii) the generation or treatment of natural or artificial gas
2for wholesale or retail sale that is delivered to customers
3through pipes, pipelines, or mains; or (iii) the treatment of
4water for wholesale or retail sale that is delivered to
5customers through pipes, pipelines, or mains. The provisions of
6Public Act 98-583 are declaratory of existing law as to the
7meaning and scope of this exemption. Beginning on July 1, 2017,
8the exemption provided by this paragraph (18) includes, but is
9not limited to, graphic arts machinery and equipment, as
10defined in paragraph (6) of this Section.
11    (19) Personal property delivered to a purchaser or
12purchaser's donee inside Illinois when the purchase order for
13that personal property was received by a florist located
14outside Illinois who has a florist located inside Illinois
15deliver the personal property.
16    (20) Semen used for artificial insemination of livestock
17for direct agricultural production.
18    (21) Horses, or interests in horses, registered with and
19meeting the requirements of any of the Arabian Horse Club
20Registry of America, Appaloosa Horse Club, American Quarter
21Horse Association, United States Trotting Association, or
22Jockey Club, as appropriate, used for purposes of breeding or
23racing for prizes. This item (21) is exempt from the provisions
24of Section 3-90, and the exemption provided for under this item
25(21) applies for all periods beginning May 30, 1995, but no
26claim for credit or refund is allowed on or after January 1,

 

 

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12008 for such taxes paid during the period beginning May 30,
22000 and ending on January 1, 2008.
3    (22) Computers and communications equipment utilized for
4any hospital purpose and equipment used in the diagnosis,
5analysis, or treatment of hospital patients purchased by a
6lessor who leases the equipment, under a lease of one year or
7longer executed or in effect at the time the lessor would
8otherwise be subject to the tax imposed by this Act, to a
9hospital that has been issued an active tax exemption
10identification number by the Department under Section 1g of the
11Retailers' Occupation Tax Act. If the equipment is leased in a
12manner that does not qualify for this exemption or is used in
13any other non-exempt manner, the lessor shall be liable for the
14tax imposed under this Act or the Service Use Tax Act, as the
15case may be, based on the fair market value of the property at
16the time the non-qualifying use occurs. No lessor shall collect
17or attempt to collect an amount (however designated) that
18purports to reimburse that lessor for the tax imposed by this
19Act or the Service Use Tax Act, as the case may be, if the tax
20has not been paid by the lessor. If a lessor improperly
21collects any such amount from the lessee, the lessee shall have
22a legal right to claim a refund of that amount from the lessor.
23If, however, that amount is not refunded to the lessee for any
24reason, the lessor is liable to pay that amount to the
25Department.
26    (23) Personal property purchased by a lessor who leases the

 

 

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1property, under a lease of one year or longer executed or in
2effect at the time the lessor would otherwise be subject to the
3tax imposed by this Act, to a governmental body that has been
4issued an active sales tax exemption identification number by
5the Department under Section 1g of the Retailers' Occupation
6Tax Act. If the property is leased in a manner that does not
7qualify for this exemption or used in any other non-exempt
8manner, the lessor shall be liable for the tax imposed under
9this Act or the Service Use Tax Act, as the case may be, based
10on the fair market value of the property at the time the
11non-qualifying use occurs. No lessor shall collect or attempt
12to collect an amount (however designated) that purports to
13reimburse that lessor for the tax imposed by this Act or the
14Service Use Tax Act, as the case may be, if the tax has not been
15paid by the lessor. If a lessor improperly collects any such
16amount from the lessee, the lessee shall have a legal right to
17claim a refund of that amount from the lessor. If, however,
18that amount is not refunded to the lessee for any reason, the
19lessor is liable to pay that amount to the Department.
20    (24) Beginning with taxable years ending on or after
21December 31, 1995 and ending with taxable years ending on or
22before December 31, 2004, personal property that is donated for
23disaster relief to be used in a State or federally declared
24disaster area in Illinois or bordering Illinois by a
25manufacturer or retailer that is registered in this State to a
26corporation, society, association, foundation, or institution

 

 

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1that has been issued a sales tax exemption identification
2number by the Department that assists victims of the disaster
3who reside within the declared disaster area.
4    (25) Beginning with taxable years ending on or after
5December 31, 1995 and ending with taxable years ending on or
6before December 31, 2004, personal property that is used in the
7performance of infrastructure repairs in this State, including
8but not limited to municipal roads and streets, access roads,
9bridges, sidewalks, waste disposal systems, water and sewer
10line extensions, water distribution and purification
11facilities, storm water drainage and retention facilities, and
12sewage treatment facilities, resulting from a State or
13federally declared disaster in Illinois or bordering Illinois
14when such repairs are initiated on facilities located in the
15declared disaster area within 6 months after the disaster.
16    (26) Beginning July 1, 1999, game or game birds purchased
17at a "game breeding and hunting preserve area" as that term is
18used in the Wildlife Code. This paragraph is exempt from the
19provisions of Section 3-90.
20    (27) A motor vehicle, as that term is defined in Section
211-146 of the Illinois Vehicle Code, that is donated to a
22corporation, limited liability company, society, association,
23foundation, or institution that is determined by the Department
24to be organized and operated exclusively for educational
25purposes. For purposes of this exemption, "a corporation,
26limited liability company, society, association, foundation,

 

 

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1or institution organized and operated exclusively for
2educational purposes" means all tax-supported public schools,
3private schools that offer systematic instruction in useful
4branches of learning by methods common to public schools and
5that compare favorably in their scope and intensity with the
6course of study presented in tax-supported schools, and
7vocational or technical schools or institutes organized and
8operated exclusively to provide a course of study of not less
9than 6 weeks duration and designed to prepare individuals to
10follow a trade or to pursue a manual, technical, mechanical,
11industrial, business, or commercial occupation.
12    (28) Beginning January 1, 2000, personal property,
13including food, purchased through fundraising events for the
14benefit of a public or private elementary or secondary school,
15a group of those schools, or one or more school districts if
16the events are sponsored by an entity recognized by the school
17district that consists primarily of volunteers and includes
18parents and teachers of the school children. This paragraph
19does not apply to fundraising events (i) for the benefit of
20private home instruction or (ii) for which the fundraising
21entity purchases the personal property sold at the events from
22another individual or entity that sold the property for the
23purpose of resale by the fundraising entity and that profits
24from the sale to the fundraising entity. This paragraph is
25exempt from the provisions of Section 3-90.
26    (29) Beginning January 1, 2000 and through December 31,

 

 

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12001, new or used automatic vending machines that prepare and
2serve hot food and beverages, including coffee, soup, and other
3items, and replacement parts for these machines. Beginning
4January 1, 2002 and through June 30, 2003, machines and parts
5for machines used in commercial, coin-operated amusement and
6vending business if a use or occupation tax is paid on the
7gross receipts derived from the use of the commercial,
8coin-operated amusement and vending machines. This paragraph
9is exempt from the provisions of Section 3-90.
10    (30) Beginning January 1, 2001 and through June 30, 2016,
11food for human consumption that is to be consumed off the
12premises where it is sold (other than alcoholic beverages, soft
13drinks, and food that has been prepared for immediate
14consumption) and prescription and nonprescription medicines,
15drugs, medical appliances, and insulin, urine testing
16materials, syringes, and needles used by diabetics, for human
17use, when purchased for use by a person receiving medical
18assistance under Article V of the Illinois Public Aid Code who
19resides in a licensed long-term care facility, as defined in
20the Nursing Home Care Act, or in a licensed facility as defined
21in the ID/DD Community Care Act, the MC/DD Act, or the
22Specialized Mental Health Rehabilitation Act of 2013.
23    (31) Beginning on August 2, 2001 (the effective date of
24Public Act 92-227) this amendatory Act of the 92nd General
25Assembly, computers and communications equipment utilized for
26any hospital purpose and equipment used in the diagnosis,

 

 

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1analysis, or treatment of hospital patients purchased by a
2lessor who leases the equipment, under a lease of one year or
3longer executed or in effect at the time the lessor would
4otherwise be subject to the tax imposed by this Act, to a
5hospital that has been issued an active tax exemption
6identification number by the Department under Section 1g of the
7Retailers' Occupation Tax Act. If the equipment is leased in a
8manner that does not qualify for this exemption or is used in
9any other nonexempt manner, the lessor shall be liable for the
10tax imposed under this Act or the Service Use Tax Act, as the
11case may be, based on the fair market value of the property at
12the time the nonqualifying use occurs. No lessor shall collect
13or attempt to collect an amount (however designated) that
14purports to reimburse that lessor for the tax imposed by this
15Act or the Service Use Tax Act, as the case may be, if the tax
16has not been paid by the lessor. If a lessor improperly
17collects any such amount from the lessee, the lessee shall have
18a legal right to claim a refund of that amount from the lessor.
19If, however, that amount is not refunded to the lessee for any
20reason, the lessor is liable to pay that amount to the
21Department. This paragraph is exempt from the provisions of
22Section 3-90.
23    (32) Beginning on August 2, 2001 (the effective date of
24Public Act 92-227) this amendatory Act of the 92nd General
25Assembly, personal property purchased by a lessor who leases
26the property, under a lease of one year or longer executed or

 

 

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1in effect at the time the lessor would otherwise be subject to
2the tax imposed by this Act, to a governmental body that has
3been issued an active sales tax exemption identification number
4by the Department under Section 1g of the Retailers' Occupation
5Tax Act. If the property is leased in a manner that does not
6qualify for this exemption or used in any other nonexempt
7manner, the lessor shall be liable for the tax imposed under
8this Act or the Service Use Tax Act, as the case may be, based
9on the fair market value of the property at the time the
10nonqualifying use occurs. No lessor shall collect or attempt to
11collect an amount (however designated) that purports to
12reimburse that lessor for the tax imposed by this Act or the
13Service Use Tax Act, as the case may be, if the tax has not been
14paid by the lessor. If a lessor improperly collects any such
15amount from the lessee, the lessee shall have a legal right to
16claim a refund of that amount from the lessor. If, however,
17that amount is not refunded to the lessee for any reason, the
18lessor is liable to pay that amount to the Department. This
19paragraph is exempt from the provisions of Section 3-90.
20    (33) On and after July 1, 2003 and through June 30, 2004,
21the use in this State of motor vehicles of the second division
22with a gross vehicle weight in excess of 8,000 pounds and that
23are subject to the commercial distribution fee imposed under
24Section 3-815.1 of the Illinois Vehicle Code. Beginning on July
251, 2004 and through June 30, 2005, the use in this State of
26motor vehicles of the second division: (i) with a gross vehicle

 

 

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1weight rating in excess of 8,000 pounds; (ii) that are subject
2to the commercial distribution fee imposed under Section
33-815.1 of the Illinois Vehicle Code; and (iii) that are
4primarily used for commercial purposes. Through June 30, 2005,
5this exemption applies to repair and replacement parts added
6after the initial purchase of such a motor vehicle if that
7motor vehicle is used in a manner that would qualify for the
8rolling stock exemption otherwise provided for in this Act. For
9purposes of this paragraph, the term "used for commercial
10purposes" means the transportation of persons or property in
11furtherance of any commercial or industrial enterprise,
12whether for-hire or not.
13    (34) Beginning January 1, 2008, tangible personal property
14used in the construction or maintenance of a community water
15supply, as defined under Section 3.145 of the Environmental
16Protection Act, that is operated by a not-for-profit
17corporation that holds a valid water supply permit issued under
18Title IV of the Environmental Protection Act. This paragraph is
19exempt from the provisions of Section 3-90.
20    (35) Beginning January 1, 2010, materials, parts,
21equipment, components, and furnishings incorporated into or
22upon an aircraft as part of the modification, refurbishment,
23completion, replacement, repair, or maintenance of the
24aircraft. This exemption includes consumable supplies used in
25the modification, refurbishment, completion, replacement,
26repair, and maintenance of aircraft, but excludes any

 

 

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1materials, parts, equipment, components, and consumable
2supplies used in the modification, replacement, repair, and
3maintenance of aircraft engines or power plants, whether such
4engines or power plants are installed or uninstalled upon any
5such aircraft. "Consumable supplies" include, but are not
6limited to, adhesive, tape, sandpaper, general purpose
7lubricants, cleaning solution, latex gloves, and protective
8films. This exemption applies only to the use of qualifying
9tangible personal property by persons who modify, refurbish,
10complete, repair, replace, or maintain aircraft and who (i)
11hold an Air Agency Certificate and are empowered to operate an
12approved repair station by the Federal Aviation
13Administration, (ii) have a Class IV Rating, and (iii) conduct
14operations in accordance with Part 145 of the Federal Aviation
15Regulations. The exemption does not include aircraft operated
16by a commercial air carrier providing scheduled passenger air
17service pursuant to authority issued under Part 121 or Part 129
18of the Federal Aviation Regulations. The changes made to this
19paragraph (35) by Public Act 98-534 are declarative of existing
20law.
21    (36) Tangible personal property purchased by a
22public-facilities corporation, as described in Section
2311-65-10 of the Illinois Municipal Code, for purposes of
24constructing or furnishing a municipal convention hall, but
25only if the legal title to the municipal convention hall is
26transferred to the municipality without any further

 

 

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1consideration by or on behalf of the municipality at the time
2of the completion of the municipal convention hall or upon the
3retirement or redemption of any bonds or other debt instruments
4issued by the public-facilities corporation in connection with
5the development of the municipal convention hall. This
6exemption includes existing public-facilities corporations as
7provided in Section 11-65-25 of the Illinois Municipal Code.
8This paragraph is exempt from the provisions of Section 3-90.
9    (37) Beginning January 1, 2017, menstrual pads, tampons,
10and menstrual cups.
11    (38) Merchandise that is subject to the Rental Purchase
12Agreement Occupation and Use Tax. The purchaser must certify
13that the item is purchased to be rented subject to a rental
14purchase agreement, as defined in the Rental Purchase Agreement
15Act, and provide proof of registration under the Rental
16Purchase Agreement Occupation and Use Tax Act. This paragraph
17is exempt from the provisions of Section 3-90.
18(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
19100-22, eff. 7-6-17; 100-437, eff. 1-1-18; revised 9-27-17.)
 
20    Section 10. The Service Use Tax Act is amended by changing
21Section 3-5 as follows:
 
22    (35 ILCS 110/3-5)
23    Sec. 3-5. Exemptions. Use of the following tangible
24personal property is exempt from the tax imposed by this Act:

 

 

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1    (1) Personal property purchased from a corporation,
2society, association, foundation, institution, or
3organization, other than a limited liability company, that is
4organized and operated as a not-for-profit service enterprise
5for the benefit of persons 65 years of age or older if the
6personal property was not purchased by the enterprise for the
7purpose of resale by the enterprise.
8    (2) Personal property purchased by a non-profit Illinois
9county fair association for use in conducting, operating, or
10promoting the county fair.
11    (3) Personal property purchased by a not-for-profit arts or
12cultural organization that establishes, by proof required by
13the Department by rule, that it has received an exemption under
14Section 501(c)(3) of the Internal Revenue Code and that is
15organized and operated primarily for the presentation or
16support of arts or cultural programming, activities, or
17services. These organizations include, but are not limited to,
18music and dramatic arts organizations such as symphony
19orchestras and theatrical groups, arts and cultural service
20organizations, local arts councils, visual arts organizations,
21and media arts organizations. On and after the effective date
22of this amendatory Act of the 92nd General Assembly, however,
23an entity otherwise eligible for this exemption shall not make
24tax-free purchases unless it has an active identification
25number issued by the Department.
26    (4) Legal tender, currency, medallions, or gold or silver

 

 

HB5316- 20 -LRB100 16845 HLH 31986 b

1coinage issued by the State of Illinois, the government of the
2United States of America, or the government of any foreign
3country, and bullion.
4    (5) Until July 1, 2003 and beginning again on September 1,
52004 through August 30, 2014, graphic arts machinery and
6equipment, including repair and replacement parts, both new and
7used, and including that manufactured on special order or
8purchased for lease, certified by the purchaser to be used
9primarily for graphic arts production. Equipment includes
10chemicals or chemicals acting as catalysts but only if the
11chemicals or chemicals acting as catalysts effect a direct and
12immediate change upon a graphic arts product. Beginning on July
131, 2017, graphic arts machinery and equipment is included in
14the manufacturing and assembling machinery and equipment
15exemption under Section 2 of this Act.
16    (6) Personal property purchased from a teacher-sponsored
17student organization affiliated with an elementary or
18secondary school located in Illinois.
19    (7) Farm machinery and equipment, both new and used,
20including that manufactured on special order, certified by the
21purchaser to be used primarily for production agriculture or
22State or federal agricultural programs, including individual
23replacement parts for the machinery and equipment, including
24machinery and equipment purchased for lease, and including
25implements of husbandry defined in Section 1-130 of the
26Illinois Vehicle Code, farm machinery and agricultural

 

 

HB5316- 21 -LRB100 16845 HLH 31986 b

1chemical and fertilizer spreaders, and nurse wagons required to
2be registered under Section 3-809 of the Illinois Vehicle Code,
3but excluding other motor vehicles required to be registered
4under the Illinois Vehicle Code. Horticultural polyhouses or
5hoop houses used for propagating, growing, or overwintering
6plants shall be considered farm machinery and equipment under
7this item (7). Agricultural chemical tender tanks and dry boxes
8shall include units sold separately from a motor vehicle
9required to be licensed and units sold mounted on a motor
10vehicle required to be licensed if the selling price of the
11tender is separately stated.
12    Farm machinery and equipment shall include precision
13farming equipment that is installed or purchased to be
14installed on farm machinery and equipment including, but not
15limited to, tractors, harvesters, sprayers, planters, seeders,
16or spreaders. Precision farming equipment includes, but is not
17limited to, soil testing sensors, computers, monitors,
18software, global positioning and mapping systems, and other
19such equipment.
20    Farm machinery and equipment also includes computers,
21sensors, software, and related equipment used primarily in the
22computer-assisted operation of production agriculture
23facilities, equipment, and activities such as, but not limited
24to, the collection, monitoring, and correlation of animal and
25crop data for the purpose of formulating animal diets and
26agricultural chemicals. This item (7) is exempt from the

 

 

HB5316- 22 -LRB100 16845 HLH 31986 b

1provisions of Section 3-75.
2    (8) Until June 30, 2013, fuel and petroleum products sold
3to or used by an air common carrier, certified by the carrier
4to be used for consumption, shipment, or storage in the conduct
5of its business as an air common carrier, for a flight destined
6for or returning from a location or locations outside the
7United States without regard to previous or subsequent domestic
8stopovers.
9    Beginning July 1, 2013, fuel and petroleum products sold to
10or used by an air carrier, certified by the carrier to be used
11for consumption, shipment, or storage in the conduct of its
12business as an air common carrier, for a flight that (i) is
13engaged in foreign trade or is engaged in trade between the
14United States and any of its possessions and (ii) transports at
15least one individual or package for hire from the city of
16origination to the city of final destination on the same
17aircraft, without regard to a change in the flight number of
18that aircraft.
19    (9) Proceeds of mandatory service charges separately
20stated on customers' bills for the purchase and consumption of
21food and beverages acquired as an incident to the purchase of a
22service from a serviceman, to the extent that the proceeds of
23the service charge are in fact turned over as tips or as a
24substitute for tips to the employees who participate directly
25in preparing, serving, hosting or cleaning up the food or
26beverage function with respect to which the service charge is

 

 

HB5316- 23 -LRB100 16845 HLH 31986 b

1imposed.
2    (10) Until July 1, 2003, oil field exploration, drilling,
3and production equipment, including (i) rigs and parts of rigs,
4rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
5tubular goods, including casing and drill strings, (iii) pumps
6and pump-jack units, (iv) storage tanks and flow lines, (v) any
7individual replacement part for oil field exploration,
8drilling, and production equipment, and (vi) machinery and
9equipment purchased for lease; but excluding motor vehicles
10required to be registered under the Illinois Vehicle Code.
11    (11) Proceeds from the sale of photoprocessing machinery
12and equipment, including repair and replacement parts, both new
13and used, including that manufactured on special order,
14certified by the purchaser to be used primarily for
15photoprocessing, and including photoprocessing machinery and
16equipment purchased for lease.
17    (12) Coal and aggregate exploration, mining, off-highway
18hauling, processing, maintenance, and reclamation equipment,
19including replacement parts and equipment, and including
20equipment purchased for lease, but excluding motor vehicles
21required to be registered under the Illinois Vehicle Code. The
22changes made to this Section by Public Act 97-767 apply on and
23after July 1, 2003, but no claim for credit or refund is
24allowed on or after August 16, 2013 (the effective date of
25Public Act 98-456) for such taxes paid during the period
26beginning July 1, 2003 and ending on August 16, 2013 (the

 

 

HB5316- 24 -LRB100 16845 HLH 31986 b

1effective date of Public Act 98-456). This item (12) is exempt
2from the provisions of Section 3-75.
3    (13) Semen used for artificial insemination of livestock
4for direct agricultural production.
5    (14) Horses, or interests in horses, registered with and
6meeting the requirements of any of the Arabian Horse Club
7Registry of America, Appaloosa Horse Club, American Quarter
8Horse Association, United States Trotting Association, or
9Jockey Club, as appropriate, used for purposes of breeding or
10racing for prizes. This item (14) is exempt from the provisions
11of Section 3-75, and the exemption provided for under this item
12(14) applies for all periods beginning May 30, 1995, but no
13claim for credit or refund is allowed on or after the effective
14date of this amendatory Act of the 95th General Assembly for
15such taxes paid during the period beginning May 30, 2000 and
16ending on the effective date of this amendatory Act of the 95th
17General Assembly.
18    (15) Computers and communications equipment utilized for
19any hospital purpose and equipment used in the diagnosis,
20analysis, or treatment of hospital patients purchased by a
21lessor who leases the equipment, under a lease of one year or
22longer executed or in effect at the time the lessor would
23otherwise be subject to the tax imposed by this Act, to a
24hospital that has been issued an active tax exemption
25identification number by the Department under Section 1g of the
26Retailers' Occupation Tax Act. If the equipment is leased in a

 

 

HB5316- 25 -LRB100 16845 HLH 31986 b

1manner that does not qualify for this exemption or is used in
2any other non-exempt manner, the lessor shall be liable for the
3tax imposed under this Act or the Use Tax Act, as the case may
4be, based on the fair market value of the property at the time
5the non-qualifying use occurs. No lessor shall collect or
6attempt to collect an amount (however designated) that purports
7to reimburse that lessor for the tax imposed by this Act or the
8Use Tax Act, as the case may be, if the tax has not been paid by
9the lessor. If a lessor improperly collects any such amount
10from the lessee, the lessee shall have a legal right to claim a
11refund of that amount from the lessor. If, however, that amount
12is not refunded to the lessee for any reason, the lessor is
13liable to pay that amount to the Department.
14    (16) Personal property purchased by a lessor who leases the
15property, under a lease of one year or longer executed or in
16effect at the time the lessor would otherwise be subject to the
17tax imposed by this Act, to a governmental body that has been
18issued an active tax exemption identification number by the
19Department under Section 1g of the Retailers' Occupation Tax
20Act. If the property is leased in a manner that does not
21qualify for this exemption or is used in any other non-exempt
22manner, the lessor shall be liable for the tax imposed under
23this Act or the Use Tax Act, as the case may be, based on the
24fair market value of the property at the time the
25non-qualifying use occurs. No lessor shall collect or attempt
26to collect an amount (however designated) that purports to

 

 

HB5316- 26 -LRB100 16845 HLH 31986 b

1reimburse that lessor for the tax imposed by this Act or the
2Use Tax Act, as the case may be, if the tax has not been paid by
3the lessor. If a lessor improperly collects any such amount
4from the lessee, the lessee shall have a legal right to claim a
5refund of that amount from the lessor. If, however, that amount
6is not refunded to the lessee for any reason, the lessor is
7liable to pay that amount to the Department.
8    (17) Beginning with taxable years ending on or after
9December 31, 1995 and ending with taxable years ending on or
10before December 31, 2004, personal property that is donated for
11disaster relief to be used in a State or federally declared
12disaster area in Illinois or bordering Illinois by a
13manufacturer or retailer that is registered in this State to a
14corporation, society, association, foundation, or institution
15that has been issued a sales tax exemption identification
16number by the Department that assists victims of the disaster
17who reside within the declared disaster area.
18    (18) Beginning with taxable years ending on or after
19December 31, 1995 and ending with taxable years ending on or
20before December 31, 2004, personal property that is used in the
21performance of infrastructure repairs in this State, including
22but not limited to municipal roads and streets, access roads,
23bridges, sidewalks, waste disposal systems, water and sewer
24line extensions, water distribution and purification
25facilities, storm water drainage and retention facilities, and
26sewage treatment facilities, resulting from a State or

 

 

HB5316- 27 -LRB100 16845 HLH 31986 b

1federally declared disaster in Illinois or bordering Illinois
2when such repairs are initiated on facilities located in the
3declared disaster area within 6 months after the disaster.
4    (19) Beginning July 1, 1999, game or game birds purchased
5at a "game breeding and hunting preserve area" as that term is
6used in the Wildlife Code. This paragraph is exempt from the
7provisions of Section 3-75.
8    (20) A motor vehicle, as that term is defined in Section
91-146 of the Illinois Vehicle Code, that is donated to a
10corporation, limited liability company, society, association,
11foundation, or institution that is determined by the Department
12to be organized and operated exclusively for educational
13purposes. For purposes of this exemption, "a corporation,
14limited liability company, society, association, foundation,
15or institution organized and operated exclusively for
16educational purposes" means all tax-supported public schools,
17private schools that offer systematic instruction in useful
18branches of learning by methods common to public schools and
19that compare favorably in their scope and intensity with the
20course of study presented in tax-supported schools, and
21vocational or technical schools or institutes organized and
22operated exclusively to provide a course of study of not less
23than 6 weeks duration and designed to prepare individuals to
24follow a trade or to pursue a manual, technical, mechanical,
25industrial, business, or commercial occupation.
26    (21) Beginning January 1, 2000, personal property,

 

 

HB5316- 28 -LRB100 16845 HLH 31986 b

1including food, purchased through fundraising events for the
2benefit of a public or private elementary or secondary school,
3a group of those schools, or one or more school districts if
4the events are sponsored by an entity recognized by the school
5district that consists primarily of volunteers and includes
6parents and teachers of the school children. This paragraph
7does not apply to fundraising events (i) for the benefit of
8private home instruction or (ii) for which the fundraising
9entity purchases the personal property sold at the events from
10another individual or entity that sold the property for the
11purpose of resale by the fundraising entity and that profits
12from the sale to the fundraising entity. This paragraph is
13exempt from the provisions of Section 3-75.
14    (22) Beginning January 1, 2000 and through December 31,
152001, new or used automatic vending machines that prepare and
16serve hot food and beverages, including coffee, soup, and other
17items, and replacement parts for these machines. Beginning
18January 1, 2002 and through June 30, 2003, machines and parts
19for machines used in commercial, coin-operated amusement and
20vending business if a use or occupation tax is paid on the
21gross receipts derived from the use of the commercial,
22coin-operated amusement and vending machines. This paragraph
23is exempt from the provisions of Section 3-75.
24    (23) Beginning August 23, 2001 and through June 30, 2016,
25food for human consumption that is to be consumed off the
26premises where it is sold (other than alcoholic beverages, soft

 

 

HB5316- 29 -LRB100 16845 HLH 31986 b

1drinks, and food that has been prepared for immediate
2consumption) and prescription and nonprescription medicines,
3drugs, medical appliances, and insulin, urine testing
4materials, syringes, and needles used by diabetics, for human
5use, when purchased for use by a person receiving medical
6assistance under Article V of the Illinois Public Aid Code who
7resides in a licensed long-term care facility, as defined in
8the Nursing Home Care Act, or in a licensed facility as defined
9in the ID/DD Community Care Act, the MC/DD Act, or the
10Specialized Mental Health Rehabilitation Act of 2013.
11    (24) Beginning on the effective date of this amendatory Act
12of the 92nd General Assembly, computers and communications
13equipment utilized for any hospital purpose and equipment used
14in the diagnosis, analysis, or treatment of hospital patients
15purchased by a lessor who leases the equipment, under a lease
16of one year or longer executed or in effect at the time the
17lessor would otherwise be subject to the tax imposed by this
18Act, to a hospital that has been issued an active tax exemption
19identification number by the Department under Section 1g of the
20Retailers' Occupation Tax Act. If the equipment is leased in a
21manner that does not qualify for this exemption or is used in
22any other nonexempt manner, the lessor shall be liable for the
23tax imposed under this Act or the Use Tax Act, as the case may
24be, based on the fair market value of the property at the time
25the nonqualifying use occurs. No lessor shall collect or
26attempt to collect an amount (however designated) that purports

 

 

HB5316- 30 -LRB100 16845 HLH 31986 b

1to reimburse that lessor for the tax imposed by this Act or the
2Use Tax Act, as the case may be, if the tax has not been paid by
3the lessor. If a lessor improperly collects any such amount
4from the lessee, the lessee shall have a legal right to claim a
5refund of that amount from the lessor. If, however, that amount
6is not refunded to the lessee for any reason, the lessor is
7liable to pay that amount to the Department. This paragraph is
8exempt from the provisions of Section 3-75.
9    (25) Beginning on the effective date of this amendatory Act
10of the 92nd General Assembly, personal property purchased by a
11lessor who leases the property, under a lease of one year or
12longer executed or in effect at the time the lessor would
13otherwise be subject to the tax imposed by this Act, to a
14governmental body that has been issued an active tax exemption
15identification number by the Department under Section 1g of the
16Retailers' Occupation Tax Act. If the property is leased in a
17manner that does not qualify for this exemption or is used in
18any other nonexempt manner, the lessor shall be liable for the
19tax imposed under this Act or the Use Tax Act, as the case may
20be, based on the fair market value of the property at the time
21the nonqualifying use occurs. No lessor shall collect or
22attempt to collect an amount (however designated) that purports
23to reimburse that lessor for the tax imposed by this Act or the
24Use Tax Act, as the case may be, if the tax has not been paid by
25the lessor. If a lessor improperly collects any such amount
26from the lessee, the lessee shall have a legal right to claim a

 

 

HB5316- 31 -LRB100 16845 HLH 31986 b

1refund of that amount from the lessor. If, however, that amount
2is not refunded to the lessee for any reason, the lessor is
3liable to pay that amount to the Department. This paragraph is
4exempt from the provisions of Section 3-75.
5    (26) Beginning January 1, 2008, tangible personal property
6used in the construction or maintenance of a community water
7supply, as defined under Section 3.145 of the Environmental
8Protection Act, that is operated by a not-for-profit
9corporation that holds a valid water supply permit issued under
10Title IV of the Environmental Protection Act. This paragraph is
11exempt from the provisions of Section 3-75.
12    (27) Beginning January 1, 2010, materials, parts,
13equipment, components, and furnishings incorporated into or
14upon an aircraft as part of the modification, refurbishment,
15completion, replacement, repair, or maintenance of the
16aircraft. This exemption includes consumable supplies used in
17the modification, refurbishment, completion, replacement,
18repair, and maintenance of aircraft, but excludes any
19materials, parts, equipment, components, and consumable
20supplies used in the modification, replacement, repair, and
21maintenance of aircraft engines or power plants, whether such
22engines or power plants are installed or uninstalled upon any
23such aircraft. "Consumable supplies" include, but are not
24limited to, adhesive, tape, sandpaper, general purpose
25lubricants, cleaning solution, latex gloves, and protective
26films. This exemption applies only to the use of qualifying

 

 

HB5316- 32 -LRB100 16845 HLH 31986 b

1tangible personal property transferred incident to the
2modification, refurbishment, completion, replacement, repair,
3or maintenance of aircraft by persons who (i) hold an Air
4Agency Certificate and are empowered to operate an approved
5repair station by the Federal Aviation Administration, (ii)
6have a Class IV Rating, and (iii) conduct operations in
7accordance with Part 145 of the Federal Aviation Regulations.
8The exemption does not include aircraft operated by a
9commercial air carrier providing scheduled passenger air
10service pursuant to authority issued under Part 121 or Part 129
11of the Federal Aviation Regulations. The changes made to this
12paragraph (27) by Public Act 98-534 are declarative of existing
13law.
14    (28) Tangible personal property purchased by a
15public-facilities corporation, as described in Section
1611-65-10 of the Illinois Municipal Code, for purposes of
17constructing or furnishing a municipal convention hall, but
18only if the legal title to the municipal convention hall is
19transferred to the municipality without any further
20consideration by or on behalf of the municipality at the time
21of the completion of the municipal convention hall or upon the
22retirement or redemption of any bonds or other debt instruments
23issued by the public-facilities corporation in connection with
24the development of the municipal convention hall. This
25exemption includes existing public-facilities corporations as
26provided in Section 11-65-25 of the Illinois Municipal Code.

 

 

HB5316- 33 -LRB100 16845 HLH 31986 b

1This paragraph is exempt from the provisions of Section 3-75.
2    (29) Beginning January 1, 2017, menstrual pads, tampons,
3and menstrual cups.
4(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
5100-22, eff. 7-6-17.)
 
6    Section 15. The Service Occupation Tax Act is amended by
7changing Section 3-5 as follows:
 
8    (35 ILCS 115/3-5)
9    Sec. 3-5. Exemptions. The following tangible personal
10property is exempt from the tax imposed by this Act:
11    (1) Personal property sold by a corporation, society,
12association, foundation, institution, or organization, other
13than a limited liability company, that is organized and
14operated as a not-for-profit service enterprise for the benefit
15of persons 65 years of age or older if the personal property
16was not purchased by the enterprise for the purpose of resale
17by the enterprise.
18    (2) Personal property purchased by a not-for-profit
19Illinois county fair association for use in conducting,
20operating, or promoting the county fair.
21    (3) Personal property purchased by any not-for-profit arts
22or cultural organization that establishes, by proof required by
23the Department by rule, that it has received an exemption under
24Section 501(c)(3) of the Internal Revenue Code and that is

 

 

HB5316- 34 -LRB100 16845 HLH 31986 b

1organized and operated primarily for the presentation or
2support of arts or cultural programming, activities, or
3services. These organizations include, but are not limited to,
4music and dramatic arts organizations such as symphony
5orchestras and theatrical groups, arts and cultural service
6organizations, local arts councils, visual arts organizations,
7and media arts organizations. On and after the effective date
8of this amendatory Act of the 92nd General Assembly, however,
9an entity otherwise eligible for this exemption shall not make
10tax-free purchases unless it has an active identification
11number issued by the Department.
12    (4) Legal tender, currency, medallions, or gold or silver
13coinage issued by the State of Illinois, the government of the
14United States of America, or the government of any foreign
15country, and bullion.
16    (5) Until July 1, 2003 and beginning again on September 1,
172004 through August 30, 2014, graphic arts machinery and
18equipment, including repair and replacement parts, both new and
19used, and including that manufactured on special order or
20purchased for lease, certified by the purchaser to be used
21primarily for graphic arts production. Equipment includes
22chemicals or chemicals acting as catalysts but only if the
23chemicals or chemicals acting as catalysts effect a direct and
24immediate change upon a graphic arts product. Beginning on July
251, 2017, graphic arts machinery and equipment is included in
26the manufacturing and assembling machinery and equipment

 

 

HB5316- 35 -LRB100 16845 HLH 31986 b

1exemption under Section 2 of this Act.
2    (6) Personal property sold by a teacher-sponsored student
3organization affiliated with an elementary or secondary school
4located in Illinois.
5    (7) Farm machinery and equipment, both new and used,
6including that manufactured on special order, certified by the
7purchaser to be used primarily for production agriculture or
8State or federal agricultural programs, including individual
9replacement parts for the machinery and equipment, including
10machinery and equipment purchased for lease, and including
11implements of husbandry defined in Section 1-130 of the
12Illinois Vehicle Code, farm machinery and agricultural
13chemical and fertilizer spreaders, and nurse wagons required to
14be registered under Section 3-809 of the Illinois Vehicle Code,
15but excluding other motor vehicles required to be registered
16under the Illinois Vehicle Code. Horticultural polyhouses or
17hoop houses used for propagating, growing, or overwintering
18plants shall be considered farm machinery and equipment under
19this item (7). Agricultural chemical tender tanks and dry boxes
20shall include units sold separately from a motor vehicle
21required to be licensed and units sold mounted on a motor
22vehicle required to be licensed if the selling price of the
23tender is separately stated.
24    Farm machinery and equipment shall include precision
25farming equipment that is installed or purchased to be
26installed on farm machinery and equipment including, but not

 

 

HB5316- 36 -LRB100 16845 HLH 31986 b

1limited to, tractors, harvesters, sprayers, planters, seeders,
2or spreaders. Precision farming equipment includes, but is not
3limited to, soil testing sensors, computers, monitors,
4software, global positioning and mapping systems, and other
5such equipment.
6    Farm machinery and equipment also includes computers,
7sensors, software, and related equipment used primarily in the
8computer-assisted operation of production agriculture
9facilities, equipment, and activities such as, but not limited
10to, the collection, monitoring, and correlation of animal and
11crop data for the purpose of formulating animal diets and
12agricultural chemicals. This item (7) is exempt from the
13provisions of Section 3-55.
14    (8) Until June 30, 2013, fuel and petroleum products sold
15to or used by an air common carrier, certified by the carrier
16to be used for consumption, shipment, or storage in the conduct
17of its business as an air common carrier, for a flight destined
18for or returning from a location or locations outside the
19United States without regard to previous or subsequent domestic
20stopovers.
21    Beginning July 1, 2013, fuel and petroleum products sold to
22or used by an air carrier, certified by the carrier to be used
23for consumption, shipment, or storage in the conduct of its
24business as an air common carrier, for a flight that (i) is
25engaged in foreign trade or is engaged in trade between the
26United States and any of its possessions and (ii) transports at

 

 

HB5316- 37 -LRB100 16845 HLH 31986 b

1least one individual or package for hire from the city of
2origination to the city of final destination on the same
3aircraft, without regard to a change in the flight number of
4that aircraft.
5    (9) Proceeds of mandatory service charges separately
6stated on customers' bills for the purchase and consumption of
7food and beverages, to the extent that the proceeds of the
8service charge are in fact turned over as tips or as a
9substitute for tips to the employees who participate directly
10in preparing, serving, hosting or cleaning up the food or
11beverage function with respect to which the service charge is
12imposed.
13    (10) Until July 1, 2003, oil field exploration, drilling,
14and production equipment, including (i) rigs and parts of rigs,
15rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
16tubular goods, including casing and drill strings, (iii) pumps
17and pump-jack units, (iv) storage tanks and flow lines, (v) any
18individual replacement part for oil field exploration,
19drilling, and production equipment, and (vi) machinery and
20equipment purchased for lease; but excluding motor vehicles
21required to be registered under the Illinois Vehicle Code.
22    (11) Photoprocessing machinery and equipment, including
23repair and replacement parts, both new and used, including that
24manufactured on special order, certified by the purchaser to be
25used primarily for photoprocessing, and including
26photoprocessing machinery and equipment purchased for lease.

 

 

HB5316- 38 -LRB100 16845 HLH 31986 b

1    (12) Coal and aggregate exploration, mining, off-highway
2hauling, processing, maintenance, and reclamation equipment,
3including replacement parts and equipment, and including
4equipment purchased for lease, but excluding motor vehicles
5required to be registered under the Illinois Vehicle Code. The
6changes made to this Section by Public Act 97-767 apply on and
7after July 1, 2003, but no claim for credit or refund is
8allowed on or after August 16, 2013 (the effective date of
9Public Act 98-456) for such taxes paid during the period
10beginning July 1, 2003 and ending on August 16, 2013 (the
11effective date of Public Act 98-456). This item (12) is exempt
12from the provisions of Section 3-55.
13    (13) Beginning January 1, 1992 and through June 30, 2016,
14food for human consumption that is to be consumed off the
15premises where it is sold (other than alcoholic beverages, soft
16drinks and food that has been prepared for immediate
17consumption) and prescription and non-prescription medicines,
18drugs, medical appliances, and insulin, urine testing
19materials, syringes, and needles used by diabetics, for human
20use, when purchased for use by a person receiving medical
21assistance under Article V of the Illinois Public Aid Code who
22resides in a licensed long-term care facility, as defined in
23the Nursing Home Care Act, or in a licensed facility as defined
24in the ID/DD Community Care Act, the MC/DD Act, or the
25Specialized Mental Health Rehabilitation Act of 2013.
26    (14) Semen used for artificial insemination of livestock

 

 

HB5316- 39 -LRB100 16845 HLH 31986 b

1for direct agricultural production.
2    (15) Horses, or interests in horses, registered with and
3meeting the requirements of any of the Arabian Horse Club
4Registry of America, Appaloosa Horse Club, American Quarter
5Horse Association, United States Trotting Association, or
6Jockey Club, as appropriate, used for purposes of breeding or
7racing for prizes. This item (15) is exempt from the provisions
8of Section 3-55, and the exemption provided for under this item
9(15) applies for all periods beginning May 30, 1995, but no
10claim for credit or refund is allowed on or after January 1,
112008 (the effective date of Public Act 95-88) for such taxes
12paid during the period beginning May 30, 2000 and ending on
13January 1, 2008 (the effective date of Public Act 95-88).
14    (16) Computers and communications equipment utilized for
15any hospital purpose and equipment used in the diagnosis,
16analysis, or treatment of hospital patients sold to a lessor
17who leases the equipment, under a lease of one year or longer
18executed or in effect at the time of the purchase, to a
19hospital that has been issued an active tax exemption
20identification number by the Department under Section 1g of the
21Retailers' Occupation Tax Act.
22    (17) Personal property sold to a lessor who leases the
23property, under a lease of one year or longer executed or in
24effect at the time of the purchase, to a governmental body that
25has been issued an active tax exemption identification number
26by the Department under Section 1g of the Retailers' Occupation

 

 

HB5316- 40 -LRB100 16845 HLH 31986 b

1Tax Act.
2    (18) Beginning with taxable years ending on or after
3December 31, 1995 and ending with taxable years ending on or
4before December 31, 2004, personal property that is donated for
5disaster relief to be used in a State or federally declared
6disaster area in Illinois or bordering Illinois by a
7manufacturer or retailer that is registered in this State to a
8corporation, society, association, foundation, or institution
9that has been issued a sales tax exemption identification
10number by the Department that assists victims of the disaster
11who reside within the declared disaster area.
12    (19) Beginning with taxable years ending on or after
13December 31, 1995 and ending with taxable years ending on or
14before December 31, 2004, personal property that is used in the
15performance of infrastructure repairs in this State, including
16but not limited to municipal roads and streets, access roads,
17bridges, sidewalks, waste disposal systems, water and sewer
18line extensions, water distribution and purification
19facilities, storm water drainage and retention facilities, and
20sewage treatment facilities, resulting from a State or
21federally declared disaster in Illinois or bordering Illinois
22when such repairs are initiated on facilities located in the
23declared disaster area within 6 months after the disaster.
24    (20) Beginning July 1, 1999, game or game birds sold at a
25"game breeding and hunting preserve area" as that term is used
26in the Wildlife Code. This paragraph is exempt from the

 

 

HB5316- 41 -LRB100 16845 HLH 31986 b

1provisions of Section 3-55.
2    (21) A motor vehicle, as that term is defined in Section
31-146 of the Illinois Vehicle Code, that is donated to a
4corporation, limited liability company, society, association,
5foundation, or institution that is determined by the Department
6to be organized and operated exclusively for educational
7purposes. For purposes of this exemption, "a corporation,
8limited liability company, society, association, foundation,
9or institution organized and operated exclusively for
10educational purposes" means all tax-supported public schools,
11private schools that offer systematic instruction in useful
12branches of learning by methods common to public schools and
13that compare favorably in their scope and intensity with the
14course of study presented in tax-supported schools, and
15vocational or technical schools or institutes organized and
16operated exclusively to provide a course of study of not less
17than 6 weeks duration and designed to prepare individuals to
18follow a trade or to pursue a manual, technical, mechanical,
19industrial, business, or commercial occupation.
20    (22) Beginning January 1, 2000, personal property,
21including food, purchased through fundraising events for the
22benefit of a public or private elementary or secondary school,
23a group of those schools, or one or more school districts if
24the events are sponsored by an entity recognized by the school
25district that consists primarily of volunteers and includes
26parents and teachers of the school children. This paragraph

 

 

HB5316- 42 -LRB100 16845 HLH 31986 b

1does not apply to fundraising events (i) for the benefit of
2private home instruction or (ii) for which the fundraising
3entity purchases the personal property sold at the events from
4another individual or entity that sold the property for the
5purpose of resale by the fundraising entity and that profits
6from the sale to the fundraising entity. This paragraph is
7exempt from the provisions of Section 3-55.
8    (23) Beginning January 1, 2000 and through December 31,
92001, new or used automatic vending machines that prepare and
10serve hot food and beverages, including coffee, soup, and other
11items, and replacement parts for these machines. Beginning
12January 1, 2002 and through June 30, 2003, machines and parts
13for machines used in commercial, coin-operated amusement and
14vending business if a use or occupation tax is paid on the
15gross receipts derived from the use of the commercial,
16coin-operated amusement and vending machines. This paragraph
17is exempt from the provisions of Section 3-55.
18    (24) Beginning on the effective date of this amendatory Act
19of the 92nd General Assembly, computers and communications
20equipment utilized for any hospital purpose and equipment used
21in the diagnosis, analysis, or treatment of hospital patients
22sold to a lessor who leases the equipment, under a lease of one
23year or longer executed or in effect at the time of the
24purchase, to a hospital that has been issued an active tax
25exemption identification number by the Department under
26Section 1g of the Retailers' Occupation Tax Act. This paragraph

 

 

HB5316- 43 -LRB100 16845 HLH 31986 b

1is exempt from the provisions of Section 3-55.
2    (25) Beginning on the effective date of this amendatory Act
3of the 92nd General Assembly, personal property sold to a
4lessor who leases the property, under a lease of one year or
5longer executed or in effect at the time of the purchase, to a
6governmental body that has been issued an active tax exemption
7identification number by the Department under Section 1g of the
8Retailers' Occupation Tax Act. This paragraph is exempt from
9the provisions of Section 3-55.
10    (26) Beginning on January 1, 2002 and through June 30,
112016, tangible personal property purchased from an Illinois
12retailer by a taxpayer engaged in centralized purchasing
13activities in Illinois who will, upon receipt of the property
14in Illinois, temporarily store the property in Illinois (i) for
15the purpose of subsequently transporting it outside this State
16for use or consumption thereafter solely outside this State or
17(ii) for the purpose of being processed, fabricated, or
18manufactured into, attached to, or incorporated into other
19tangible personal property to be transported outside this State
20and thereafter used or consumed solely outside this State. The
21Director of Revenue shall, pursuant to rules adopted in
22accordance with the Illinois Administrative Procedure Act,
23issue a permit to any taxpayer in good standing with the
24Department who is eligible for the exemption under this
25paragraph (26). The permit issued under this paragraph (26)
26shall authorize the holder, to the extent and in the manner

 

 

HB5316- 44 -LRB100 16845 HLH 31986 b

1specified in the rules adopted under this Act, to purchase
2tangible personal property from a retailer exempt from the
3taxes imposed by this Act. Taxpayers shall maintain all
4necessary books and records to substantiate the use and
5consumption of all such tangible personal property outside of
6the State of Illinois.
7    (27) Beginning January 1, 2008, tangible personal property
8used in the construction or maintenance of a community water
9supply, as defined under Section 3.145 of the Environmental
10Protection Act, that is operated by a not-for-profit
11corporation that holds a valid water supply permit issued under
12Title IV of the Environmental Protection Act. This paragraph is
13exempt from the provisions of Section 3-55.
14    (28) Tangible personal property sold to a
15public-facilities corporation, as described in Section
1611-65-10 of the Illinois Municipal Code, for purposes of
17constructing or furnishing a municipal convention hall, but
18only if the legal title to the municipal convention hall is
19transferred to the municipality without any further
20consideration by or on behalf of the municipality at the time
21of the completion of the municipal convention hall or upon the
22retirement or redemption of any bonds or other debt instruments
23issued by the public-facilities corporation in connection with
24the development of the municipal convention hall. This
25exemption includes existing public-facilities corporations as
26provided in Section 11-65-25 of the Illinois Municipal Code.

 

 

HB5316- 45 -LRB100 16845 HLH 31986 b

1This paragraph is exempt from the provisions of Section 3-55.
2    (29) Beginning January 1, 2010, materials, parts,
3equipment, components, and furnishings incorporated into or
4upon an aircraft as part of the modification, refurbishment,
5completion, replacement, repair, or maintenance of the
6aircraft. This exemption includes consumable supplies used in
7the modification, refurbishment, completion, replacement,
8repair, and maintenance of aircraft, but excludes any
9materials, parts, equipment, components, and consumable
10supplies used in the modification, replacement, repair, and
11maintenance of aircraft engines or power plants, whether such
12engines or power plants are installed or uninstalled upon any
13such aircraft. "Consumable supplies" include, but are not
14limited to, adhesive, tape, sandpaper, general purpose
15lubricants, cleaning solution, latex gloves, and protective
16films. This exemption applies only to the transfer of
17qualifying tangible personal property incident to the
18modification, refurbishment, completion, replacement, repair,
19or maintenance of an aircraft by persons who (i) hold an Air
20Agency Certificate and are empowered to operate an approved
21repair station by the Federal Aviation Administration, (ii)
22have a Class IV Rating, and (iii) conduct operations in
23accordance with Part 145 of the Federal Aviation Regulations.
24The exemption does not include aircraft operated by a
25commercial air carrier providing scheduled passenger air
26service pursuant to authority issued under Part 121 or Part 129

 

 

HB5316- 46 -LRB100 16845 HLH 31986 b

1of the Federal Aviation Regulations. The changes made to this
2paragraph (29) by Public Act 98-534 are declarative of existing
3law.
4    (30) Beginning January 1, 2017, menstrual pads, tampons,
5and menstrual cups.
6(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
7100-22, eff. 7-6-17.)
 
8    Section 20. The Retailers' Occupation Tax Act is amended by
9changing Section 2-5 as follows:
 
10    (35 ILCS 120/2-5)
11    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
12sale of the following tangible personal property are exempt
13from the tax imposed by this Act:
14        (1) Farm chemicals.
15        (2) Farm machinery and equipment, both new and used,
16    including that manufactured on special order, certified by
17    the purchaser to be used primarily for production
18    agriculture or State or federal agricultural programs,
19    including individual replacement parts for the machinery
20    and equipment, including machinery and equipment purchased
21    for lease, and including implements of husbandry defined in
22    Section 1-130 of the Illinois Vehicle Code, farm machinery
23    and agricultural chemical and fertilizer spreaders, and
24    nurse wagons required to be registered under Section 3-809

 

 

HB5316- 47 -LRB100 16845 HLH 31986 b

1    of the Illinois Vehicle Code, but excluding other motor
2    vehicles required to be registered under the Illinois
3    Vehicle Code. Horticultural polyhouses or hoop houses used
4    for propagating, growing, or overwintering plants shall be
5    considered farm machinery and equipment under this item
6    (2). Agricultural chemical tender tanks and dry boxes shall
7    include units sold separately from a motor vehicle required
8    to be licensed and units sold mounted on a motor vehicle
9    required to be licensed, if the selling price of the tender
10    is separately stated.
11        Farm machinery and equipment shall include precision
12    farming equipment that is installed or purchased to be
13    installed on farm machinery and equipment including, but
14    not limited to, tractors, harvesters, sprayers, planters,
15    seeders, or spreaders. Precision farming equipment
16    includes, but is not limited to, soil testing sensors,
17    computers, monitors, software, global positioning and
18    mapping systems, and other such equipment.
19        Farm machinery and equipment also includes computers,
20    sensors, software, and related equipment used primarily in
21    the computer-assisted operation of production agriculture
22    facilities, equipment, and activities such as, but not
23    limited to, the collection, monitoring, and correlation of
24    animal and crop data for the purpose of formulating animal
25    diets and agricultural chemicals. This item (2) is exempt
26    from the provisions of Section 2-70.

 

 

HB5316- 48 -LRB100 16845 HLH 31986 b

1        (3) Until July 1, 2003, distillation machinery and
2    equipment, sold as a unit or kit, assembled or installed by
3    the retailer, certified by the user to be used only for the
4    production of ethyl alcohol that will be used for
5    consumption as motor fuel or as a component of motor fuel
6    for the personal use of the user, and not subject to sale
7    or resale.
8        (4) Until July 1, 2003 and beginning again September 1,
9    2004 through August 30, 2014, graphic arts machinery and
10    equipment, including repair and replacement parts, both
11    new and used, and including that manufactured on special
12    order or purchased for lease, certified by the purchaser to
13    be used primarily for graphic arts production. Equipment
14    includes chemicals or chemicals acting as catalysts but
15    only if the chemicals or chemicals acting as catalysts
16    effect a direct and immediate change upon a graphic arts
17    product. Beginning on July 1, 2017, graphic arts machinery
18    and equipment is included in the manufacturing and
19    assembling machinery and equipment exemption under
20    paragraph (14).
21        (5) A motor vehicle that is used for automobile
22    renting, as defined in the Automobile Renting Occupation
23    and Use Tax Act. This paragraph is exempt from the
24    provisions of Section 2-70.
25        (6) Personal property sold by a teacher-sponsored
26    student organization affiliated with an elementary or

 

 

HB5316- 49 -LRB100 16845 HLH 31986 b

1    secondary school located in Illinois.
2        (7) Until July 1, 2003, proceeds of that portion of the
3    selling price of a passenger car the sale of which is
4    subject to the Replacement Vehicle Tax.
5        (8) Personal property sold to an Illinois county fair
6    association for use in conducting, operating, or promoting
7    the county fair.
8        (9) Personal property sold to a not-for-profit arts or
9    cultural organization that establishes, by proof required
10    by the Department by rule, that it has received an
11    exemption under Section 501(c)(3) of the Internal Revenue
12    Code and that is organized and operated primarily for the
13    presentation or support of arts or cultural programming,
14    activities, or services. These organizations include, but
15    are not limited to, music and dramatic arts organizations
16    such as symphony orchestras and theatrical groups, arts and
17    cultural service organizations, local arts councils,
18    visual arts organizations, and media arts organizations.
19    On and after July 1, 2001 (the effective date of Public Act
20    92-35) this amendatory Act of the 92nd General Assembly,
21    however, an entity otherwise eligible for this exemption
22    shall not make tax-free purchases unless it has an active
23    identification number issued by the Department.
24        (10) Personal property sold by a corporation, society,
25    association, foundation, institution, or organization,
26    other than a limited liability company, that is organized

 

 

HB5316- 50 -LRB100 16845 HLH 31986 b

1    and operated as a not-for-profit service enterprise for the
2    benefit of persons 65 years of age or older if the personal
3    property was not purchased by the enterprise for the
4    purpose of resale by the enterprise.
5        (11) Personal property sold to a governmental body, to
6    a corporation, society, association, foundation, or
7    institution organized and operated exclusively for
8    charitable, religious, or educational purposes, or to a
9    not-for-profit corporation, society, association,
10    foundation, institution, or organization that has no
11    compensated officers or employees and that is organized and
12    operated primarily for the recreation of persons 55 years
13    of age or older. A limited liability company may qualify
14    for the exemption under this paragraph only if the limited
15    liability company is organized and operated exclusively
16    for educational purposes. On and after July 1, 1987,
17    however, no entity otherwise eligible for this exemption
18    shall make tax-free purchases unless it has an active
19    identification number issued by the Department.
20        (12) (Blank).
21        (12-5) On and after July 1, 2003 and through June 30,
22    2004, motor vehicles of the second division with a gross
23    vehicle weight in excess of 8,000 pounds that are subject
24    to the commercial distribution fee imposed under Section
25    3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
26    2004 and through June 30, 2005, the use in this State of

 

 

HB5316- 51 -LRB100 16845 HLH 31986 b

1    motor vehicles of the second division: (i) with a gross
2    vehicle weight rating in excess of 8,000 pounds; (ii) that
3    are subject to the commercial distribution fee imposed
4    under Section 3-815.1 of the Illinois Vehicle Code; and
5    (iii) that are primarily used for commercial purposes.
6    Through June 30, 2005, this exemption applies to repair and
7    replacement parts added after the initial purchase of such
8    a motor vehicle if that motor vehicle is used in a manner
9    that would qualify for the rolling stock exemption
10    otherwise provided for in this Act. For purposes of this
11    paragraph, "used for commercial purposes" means the
12    transportation of persons or property in furtherance of any
13    commercial or industrial enterprise whether for-hire or
14    not.
15        (13) Proceeds from sales to owners, lessors, or
16    shippers of tangible personal property that is utilized by
17    interstate carriers for hire for use as rolling stock
18    moving in interstate commerce and equipment operated by a
19    telecommunications provider, licensed as a common carrier
20    by the Federal Communications Commission, which is
21    permanently installed in or affixed to aircraft moving in
22    interstate commerce.
23        (14) Machinery and equipment that will be used by the
24    purchaser, or a lessee of the purchaser, primarily in the
25    process of manufacturing or assembling tangible personal
26    property for wholesale or retail sale or lease, whether the

 

 

HB5316- 52 -LRB100 16845 HLH 31986 b

1    sale or lease is made directly by the manufacturer or by
2    some other person, whether the materials used in the
3    process are owned by the manufacturer or some other person,
4    or whether the sale or lease is made apart from or as an
5    incident to the seller's engaging in the service occupation
6    of producing machines, tools, dies, jigs, patterns,
7    gauges, or other similar items of no commercial value on
8    special order for a particular purchaser. The exemption
9    provided by this paragraph (14) does not include machinery
10    and equipment used in (i) the generation of electricity for
11    wholesale or retail sale; (ii) the generation or treatment
12    of natural or artificial gas for wholesale or retail sale
13    that is delivered to customers through pipes, pipelines, or
14    mains; or (iii) the treatment of water for wholesale or
15    retail sale that is delivered to customers through pipes,
16    pipelines, or mains. The provisions of Public Act 98-583
17    are declaratory of existing law as to the meaning and scope
18    of this exemption. Beginning on July 1, 2017, the exemption
19    provided by this paragraph (14) includes, but is not
20    limited to, graphic arts machinery and equipment, as
21    defined in paragraph (4) of this Section.
22        (15) Proceeds of mandatory service charges separately
23    stated on customers' bills for purchase and consumption of
24    food and beverages, to the extent that the proceeds of the
25    service charge are in fact turned over as tips or as a
26    substitute for tips to the employees who participate

 

 

HB5316- 53 -LRB100 16845 HLH 31986 b

1    directly in preparing, serving, hosting or cleaning up the
2    food or beverage function with respect to which the service
3    charge is imposed.
4        (16) Petroleum products sold to a purchaser if the
5    seller is prohibited by federal law from charging tax to
6    the purchaser.
7        (17) Tangible personal property sold to a common
8    carrier by rail or motor that receives the physical
9    possession of the property in Illinois and that transports
10    the property, or shares with another common carrier in the
11    transportation of the property, out of Illinois on a
12    standard uniform bill of lading showing the seller of the
13    property as the shipper or consignor of the property to a
14    destination outside Illinois, for use outside Illinois.
15        (18) Legal tender, currency, medallions, or gold or
16    silver coinage issued by the State of Illinois, the
17    government of the United States of America, or the
18    government of any foreign country, and bullion.
19        (19) Until July 1, 2003, oil field exploration,
20    drilling, and production equipment, including (i) rigs and
21    parts of rigs, rotary rigs, cable tool rigs, and workover
22    rigs, (ii) pipe and tubular goods, including casing and
23    drill strings, (iii) pumps and pump-jack units, (iv)
24    storage tanks and flow lines, (v) any individual
25    replacement part for oil field exploration, drilling, and
26    production equipment, and (vi) machinery and equipment

 

 

HB5316- 54 -LRB100 16845 HLH 31986 b

1    purchased for lease; but excluding motor vehicles required
2    to be registered under the Illinois Vehicle Code.
3        (20) Photoprocessing machinery and equipment,
4    including repair and replacement parts, both new and used,
5    including that manufactured on special order, certified by
6    the purchaser to be used primarily for photoprocessing, and
7    including photoprocessing machinery and equipment
8    purchased for lease.
9        (21) Coal and aggregate exploration, mining,
10    off-highway hauling, processing, maintenance, and
11    reclamation equipment, including replacement parts and
12    equipment, and including equipment purchased for lease,
13    but excluding motor vehicles required to be registered
14    under the Illinois Vehicle Code. The changes made to this
15    Section by Public Act 97-767 apply on and after July 1,
16    2003, but no claim for credit or refund is allowed on or
17    after August 16, 2013 (the effective date of Public Act
18    98-456) for such taxes paid during the period beginning
19    July 1, 2003 and ending on August 16, 2013 (the effective
20    date of Public Act 98-456). This item (21) is exempt from
21    the provisions of Section 2-70.
22        (22) Until June 30, 2013, fuel and petroleum products
23    sold to or used by an air carrier, certified by the carrier
24    to be used for consumption, shipment, or storage in the
25    conduct of its business as an air common carrier, for a
26    flight destined for or returning from a location or

 

 

HB5316- 55 -LRB100 16845 HLH 31986 b

1    locations outside the United States without regard to
2    previous or subsequent domestic stopovers.
3        Beginning July 1, 2013, fuel and petroleum products
4    sold to or used by an air carrier, certified by the carrier
5    to be used for consumption, shipment, or storage in the
6    conduct of its business as an air common carrier, for a
7    flight that (i) is engaged in foreign trade or is engaged
8    in trade between the United States and any of its
9    possessions and (ii) transports at least one individual or
10    package for hire from the city of origination to the city
11    of final destination on the same aircraft, without regard
12    to a change in the flight number of that aircraft.
13        (23) A transaction in which the purchase order is
14    received by a florist who is located outside Illinois, but
15    who has a florist located in Illinois deliver the property
16    to the purchaser or the purchaser's donee in Illinois.
17        (24) Fuel consumed or used in the operation of ships,
18    barges, or vessels that are used primarily in or for the
19    transportation of property or the conveyance of persons for
20    hire on rivers bordering on this State if the fuel is
21    delivered by the seller to the purchaser's barge, ship, or
22    vessel while it is afloat upon that bordering river.
23        (25) Except as provided in item (25-5) of this Section,
24    a motor vehicle sold in this State to a nonresident even
25    though the motor vehicle is delivered to the nonresident in
26    this State, if the motor vehicle is not to be titled in

 

 

HB5316- 56 -LRB100 16845 HLH 31986 b

1    this State, and if a drive-away permit is issued to the
2    motor vehicle as provided in Section 3-603 of the Illinois
3    Vehicle Code or if the nonresident purchaser has vehicle
4    registration plates to transfer to the motor vehicle upon
5    returning to his or her home state. The issuance of the
6    drive-away permit or having the out-of-state registration
7    plates to be transferred is prima facie evidence that the
8    motor vehicle will not be titled in this State.
9        (25-5) The exemption under item (25) does not apply if
10    the state in which the motor vehicle will be titled does
11    not allow a reciprocal exemption for a motor vehicle sold
12    and delivered in that state to an Illinois resident but
13    titled in Illinois. The tax collected under this Act on the
14    sale of a motor vehicle in this State to a resident of
15    another state that does not allow a reciprocal exemption
16    shall be imposed at a rate equal to the state's rate of tax
17    on taxable property in the state in which the purchaser is
18    a resident, except that the tax shall not exceed the tax
19    that would otherwise be imposed under this Act. At the time
20    of the sale, the purchaser shall execute a statement,
21    signed under penalty of perjury, of his or her intent to
22    title the vehicle in the state in which the purchaser is a
23    resident within 30 days after the sale and of the fact of
24    the payment to the State of Illinois of tax in an amount
25    equivalent to the state's rate of tax on taxable property
26    in his or her state of residence and shall submit the

 

 

HB5316- 57 -LRB100 16845 HLH 31986 b

1    statement to the appropriate tax collection agency in his
2    or her state of residence. In addition, the retailer must
3    retain a signed copy of the statement in his or her
4    records. Nothing in this item shall be construed to require
5    the removal of the vehicle from this state following the
6    filing of an intent to title the vehicle in the purchaser's
7    state of residence if the purchaser titles the vehicle in
8    his or her state of residence within 30 days after the date
9    of sale. The tax collected under this Act in accordance
10    with this item (25-5) shall be proportionately distributed
11    as if the tax were collected at the 6.25% general rate
12    imposed under this Act.
13        (25-7) Beginning on July 1, 2007, no tax is imposed
14    under this Act on the sale of an aircraft, as defined in
15    Section 3 of the Illinois Aeronautics Act, if all of the
16    following conditions are met:
17            (1) the aircraft leaves this State within 15 days
18        after the later of either the issuance of the final
19        billing for the sale of the aircraft, or the authorized
20        approval for return to service, completion of the
21        maintenance record entry, and completion of the test
22        flight and ground test for inspection, as required by
23        14 C.F.R. 91.407;
24            (2) the aircraft is not based or registered in this
25        State after the sale of the aircraft; and
26            (3) the seller retains in his or her books and

 

 

HB5316- 58 -LRB100 16845 HLH 31986 b

1        records and provides to the Department a signed and
2        dated certification from the purchaser, on a form
3        prescribed by the Department, certifying that the
4        requirements of this item (25-7) are met. The
5        certificate must also include the name and address of
6        the purchaser, the address of the location where the
7        aircraft is to be titled or registered, the address of
8        the primary physical location of the aircraft, and
9        other information that the Department may reasonably
10        require.
11        For purposes of this item (25-7):
12        "Based in this State" means hangared, stored, or
13    otherwise used, excluding post-sale customizations as
14    defined in this Section, for 10 or more days in each
15    12-month period immediately following the date of the sale
16    of the aircraft.
17        "Registered in this State" means an aircraft
18    registered with the Department of Transportation,
19    Aeronautics Division, or titled or registered with the
20    Federal Aviation Administration to an address located in
21    this State.
22        This paragraph (25-7) is exempt from the provisions of
23    Section 2-70.
24        (26) Semen used for artificial insemination of
25    livestock for direct agricultural production.
26        (27) Horses, or interests in horses, registered with

 

 

HB5316- 59 -LRB100 16845 HLH 31986 b

1    and meeting the requirements of any of the Arabian Horse
2    Club Registry of America, Appaloosa Horse Club, American
3    Quarter Horse Association, United States Trotting
4    Association, or Jockey Club, as appropriate, used for
5    purposes of breeding or racing for prizes. This item (27)
6    is exempt from the provisions of Section 2-70, and the
7    exemption provided for under this item (27) applies for all
8    periods beginning May 30, 1995, but no claim for credit or
9    refund is allowed on or after January 1, 2008 (the
10    effective date of Public Act 95-88) for such taxes paid
11    during the period beginning May 30, 2000 and ending on
12    January 1, 2008 (the effective date of Public Act 95-88).
13        (28) Computers and communications equipment utilized
14    for any hospital purpose and equipment used in the
15    diagnosis, analysis, or treatment of hospital patients
16    sold to a lessor who leases the equipment, under a lease of
17    one year or longer executed or in effect at the time of the
18    purchase, to a hospital that has been issued an active tax
19    exemption identification number by the Department under
20    Section 1g of this Act.
21        (29) Personal property sold to a lessor who leases the
22    property, under a lease of one year or longer executed or
23    in effect at the time of the purchase, to a governmental
24    body that has been issued an active tax exemption
25    identification number by the Department under Section 1g of
26    this Act.

 

 

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1        (30) Beginning with taxable years ending on or after
2    December 31, 1995 and ending with taxable years ending on
3    or before December 31, 2004, personal property that is
4    donated for disaster relief to be used in a State or
5    federally declared disaster area in Illinois or bordering
6    Illinois by a manufacturer or retailer that is registered
7    in this State to a corporation, society, association,
8    foundation, or institution that has been issued a sales tax
9    exemption identification number by the Department that
10    assists victims of the disaster who reside within the
11    declared disaster area.
12        (31) Beginning with taxable years ending on or after
13    December 31, 1995 and ending with taxable years ending on
14    or before December 31, 2004, personal property that is used
15    in the performance of infrastructure repairs in this State,
16    including but not limited to municipal roads and streets,
17    access roads, bridges, sidewalks, waste disposal systems,
18    water and sewer line extensions, water distribution and
19    purification facilities, storm water drainage and
20    retention facilities, and sewage treatment facilities,
21    resulting from a State or federally declared disaster in
22    Illinois or bordering Illinois when such repairs are
23    initiated on facilities located in the declared disaster
24    area within 6 months after the disaster.
25        (32) Beginning July 1, 1999, game or game birds sold at
26    a "game breeding and hunting preserve area" as that term is

 

 

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1    used in the Wildlife Code. This paragraph is exempt from
2    the provisions of Section 2-70.
3        (33) A motor vehicle, as that term is defined in
4    Section 1-146 of the Illinois Vehicle Code, that is donated
5    to a corporation, limited liability company, society,
6    association, foundation, or institution that is determined
7    by the Department to be organized and operated exclusively
8    for educational purposes. For purposes of this exemption,
9    "a corporation, limited liability company, society,
10    association, foundation, or institution organized and
11    operated exclusively for educational purposes" means all
12    tax-supported public schools, private schools that offer
13    systematic instruction in useful branches of learning by
14    methods common to public schools and that compare favorably
15    in their scope and intensity with the course of study
16    presented in tax-supported schools, and vocational or
17    technical schools or institutes organized and operated
18    exclusively to provide a course of study of not less than 6
19    weeks duration and designed to prepare individuals to
20    follow a trade or to pursue a manual, technical,
21    mechanical, industrial, business, or commercial
22    occupation.
23        (34) Beginning January 1, 2000, personal property,
24    including food, purchased through fundraising events for
25    the benefit of a public or private elementary or secondary
26    school, a group of those schools, or one or more school

 

 

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1    districts if the events are sponsored by an entity
2    recognized by the school district that consists primarily
3    of volunteers and includes parents and teachers of the
4    school children. This paragraph does not apply to
5    fundraising events (i) for the benefit of private home
6    instruction or (ii) for which the fundraising entity
7    purchases the personal property sold at the events from
8    another individual or entity that sold the property for the
9    purpose of resale by the fundraising entity and that
10    profits from the sale to the fundraising entity. This
11    paragraph is exempt from the provisions of Section 2-70.
12        (35) Beginning January 1, 2000 and through December 31,
13    2001, new or used automatic vending machines that prepare
14    and serve hot food and beverages, including coffee, soup,
15    and other items, and replacement parts for these machines.
16    Beginning January 1, 2002 and through June 30, 2003,
17    machines and parts for machines used in commercial,
18    coin-operated amusement and vending business if a use or
19    occupation tax is paid on the gross receipts derived from
20    the use of the commercial, coin-operated amusement and
21    vending machines. This paragraph is exempt from the
22    provisions of Section 2-70.
23        (35-5) Beginning August 23, 2001 and through June 30,
24    2016, food for human consumption that is to be consumed off
25    the premises where it is sold (other than alcoholic
26    beverages, soft drinks, and food that has been prepared for

 

 

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1    immediate consumption) and prescription and
2    nonprescription medicines, drugs, medical appliances, and
3    insulin, urine testing materials, syringes, and needles
4    used by diabetics, for human use, when purchased for use by
5    a person receiving medical assistance under Article V of
6    the Illinois Public Aid Code who resides in a licensed
7    long-term care facility, as defined in the Nursing Home
8    Care Act, or a licensed facility as defined in the ID/DD
9    Community Care Act, the MC/DD Act, or the Specialized
10    Mental Health Rehabilitation Act of 2013.
11        (36) Beginning August 2, 2001, computers and
12    communications equipment utilized for any hospital purpose
13    and equipment used in the diagnosis, analysis, or treatment
14    of hospital patients sold to a lessor who leases the
15    equipment, under a lease of one year or longer executed or
16    in effect at the time of the purchase, to a hospital that
17    has been issued an active tax exemption identification
18    number by the Department under Section 1g of this Act. This
19    paragraph is exempt from the provisions of Section 2-70.
20        (37) Beginning August 2, 2001, personal property sold
21    to a lessor who leases the property, under a lease of one
22    year or longer executed or in effect at the time of the
23    purchase, to a governmental body that has been issued an
24    active tax exemption identification number by the
25    Department under Section 1g of this Act. This paragraph is
26    exempt from the provisions of Section 2-70.

 

 

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1        (38) Beginning on January 1, 2002 and through June 30,
2    2016, tangible personal property purchased from an
3    Illinois retailer by a taxpayer engaged in centralized
4    purchasing activities in Illinois who will, upon receipt of
5    the property in Illinois, temporarily store the property in
6    Illinois (i) for the purpose of subsequently transporting
7    it outside this State for use or consumption thereafter
8    solely outside this State or (ii) for the purpose of being
9    processed, fabricated, or manufactured into, attached to,
10    or incorporated into other tangible personal property to be
11    transported outside this State and thereafter used or
12    consumed solely outside this State. The Director of Revenue
13    shall, pursuant to rules adopted in accordance with the
14    Illinois Administrative Procedure Act, issue a permit to
15    any taxpayer in good standing with the Department who is
16    eligible for the exemption under this paragraph (38). The
17    permit issued under this paragraph (38) shall authorize the
18    holder, to the extent and in the manner specified in the
19    rules adopted under this Act, to purchase tangible personal
20    property from a retailer exempt from the taxes imposed by
21    this Act. Taxpayers shall maintain all necessary books and
22    records to substantiate the use and consumption of all such
23    tangible personal property outside of the State of
24    Illinois.
25        (39) Beginning January 1, 2008, tangible personal
26    property used in the construction or maintenance of a

 

 

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1    community water supply, as defined under Section 3.145 of
2    the Environmental Protection Act, that is operated by a
3    not-for-profit corporation that holds a valid water supply
4    permit issued under Title IV of the Environmental
5    Protection Act. This paragraph is exempt from the
6    provisions of Section 2-70.
7        (40) Beginning January 1, 2010, materials, parts,
8    equipment, components, and furnishings incorporated into
9    or upon an aircraft as part of the modification,
10    refurbishment, completion, replacement, repair, or
11    maintenance of the aircraft. This exemption includes
12    consumable supplies used in the modification,
13    refurbishment, completion, replacement, repair, and
14    maintenance of aircraft, but excludes any materials,
15    parts, equipment, components, and consumable supplies used
16    in the modification, replacement, repair, and maintenance
17    of aircraft engines or power plants, whether such engines
18    or power plants are installed or uninstalled upon any such
19    aircraft. "Consumable supplies" include, but are not
20    limited to, adhesive, tape, sandpaper, general purpose
21    lubricants, cleaning solution, latex gloves, and
22    protective films. This exemption applies only to the sale
23    of qualifying tangible personal property to persons who
24    modify, refurbish, complete, replace, or maintain an
25    aircraft and who (i) hold an Air Agency Certificate and are
26    empowered to operate an approved repair station by the

 

 

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1    Federal Aviation Administration, (ii) have a Class IV
2    Rating, and (iii) conduct operations in accordance with
3    Part 145 of the Federal Aviation Regulations. The exemption
4    does not include aircraft operated by a commercial air
5    carrier providing scheduled passenger air service pursuant
6    to authority issued under Part 121 or Part 129 of the
7    Federal Aviation Regulations. The changes made to this
8    paragraph (40) by Public Act 98-534 are declarative of
9    existing law.
10        (41) Tangible personal property sold to a
11    public-facilities corporation, as described in Section
12    11-65-10 of the Illinois Municipal Code, for purposes of
13    constructing or furnishing a municipal convention hall,
14    but only if the legal title to the municipal convention
15    hall is transferred to the municipality without any further
16    consideration by or on behalf of the municipality at the
17    time of the completion of the municipal convention hall or
18    upon the retirement or redemption of any bonds or other
19    debt instruments issued by the public-facilities
20    corporation in connection with the development of the
21    municipal convention hall. This exemption includes
22    existing public-facilities corporations as provided in
23    Section 11-65-25 of the Illinois Municipal Code. This
24    paragraph is exempt from the provisions of Section 2-70.
25        (42) Beginning January 1, 2017, menstrual pads,
26    tampons, and menstrual cups.

 

 

HB5316- 67 -LRB100 16845 HLH 31986 b

1        (43) Merchandise that is subject to the Rental Purchase
2    Agreement Occupation and Use Tax. The purchaser must
3    certify that the item is purchased to be rented subject to
4    a rental purchase agreement, as defined in the Rental
5    Purchase Agreement Act, and provide proof of registration
6    under the Rental Purchase Agreement Occupation and Use Tax
7    Act. This paragraph is exempt from the provisions of
8    Section 2-70.
9(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
10100-22, eff. 7-6-17; 100-321, eff. 8-24-17; 100-437, eff.
111-1-18; revised 9-26-17.)
 
12    Section 99. Effective date. This Act takes effect upon
13becoming law.