State of Illinois
92nd General Assembly
Legislation

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[ Introduced ][ Enrolled ][ House Amendment 001 ]
[ Senate Amendment 001 ]


92_SB0730eng

 
SB730 Engrossed                                LRB9204809SMdv

 1        AN ACT in relation to taxes.

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

 4        Section  5.   The  Use  Tax  Act  is  amended by changing
 5    Section 3-55 as follows:

 6        (35 ILCS 105/3-55) (from Ch. 120, par. 439.3-55)
 7        Sec. 3-55.  Multistate exemption. The tax imposed by this
 8    Act does not apply to the use of tangible  personal  property
 9    in this State under the following circumstances:
10        (a)  The   use,  in  this  State,  of  tangible  personal
11    property  acquired  outside  this  State  by  a   nonresident
12    individual  and brought into this State by the individual for
13    his or her own use while temporarily  within  this  State  or
14    while passing through this State.
15        (b)  The   use,  in  this  State,  of  tangible  personal
16    property by an interstate carrier for hire as  rolling  stock
17    moving  in interstate commerce or by lessors under a lease of
18    one year or longer executed or  in  effect  at  the  time  of
19    purchase of tangible personal property by interstate carriers
20    for-hire  for  use  as  rolling  stock  moving  in interstate
21    commerce as long  as  so  used  by  the  interstate  carriers
22    for-hire,  and  equipment  operated  by  a telecommunications
23    provider,  licensed  as  a  common  carrier  by  the  Federal
24    Communications Commission, which is permanently installed  in
25    or affixed to aircraft moving in interstate commerce.
26        (c)  The  use,  in  this  State,  by  owners, lessors, or
27    shippers of tangible personal property that  is  utilized  by
28    interstate  carriers for hire for use as rolling stock moving
29    in interstate commerce as long as so used by  the  interstate
30    carriers    for   hire,   and   equipment   operated   by   a
31    telecommunications provider, licensed as a common carrier  by
 
SB730 Engrossed             -2-                LRB9204809SMdv
 1    the  Federal  Communications Commission, which is permanently
 2    installed in or affixed  to  aircraft  moving  in  interstate
 3    commerce.
 4        (d)  The   use,  in  this  State,  of  tangible  personal
 5    property that is acquired outside this State and caused to be
 6    brought into this State by a person who has  already  paid  a
 7    tax in another State in respect to the sale, purchase, or use
 8    of  that  property,  to  the  extent of the amount of the tax
 9    properly due and paid in the other State.
10        (e)  The temporary storage, in this  State,  of  tangible
11    personal  property  that  is  acquired outside this State and
12    that, after being brought into this  State  and  stored  here
13    temporarily,   is  used  solely  outside  this  State  or  is
14    physically attached to or incorporated  into  other  tangible
15    personal  property that is used solely outside this State, or
16    is  altered  by   converting,   fabricating,   manufacturing,
17    printing,  processing,  or  shaping, and, as altered, is used
18    solely outside this State.
19        (f)  The temporary storage  in  this  State  of  building
20    materials and fixtures that are acquired either in this State
21    or  outside  this State by an Illinois registered combination
22    retailer and construction contractor, and that the  purchaser
23    thereafter  uses  outside  this  State  by incorporating that
24    property into real estate located outside this State.
25        (g)  The use or purchase of tangible personal property by
26    a common carrier by rail or motor that receives the  physical
27    possession  of  the property in Illinois, and that transports
28    the property, or shares with another common  carrier  in  the
29    transportation of the property, out of Illinois on a standard
30    uniform  bill of lading showing the seller of the property as
31    the shipper or consignor of the  property  to  a  destination
32    outside Illinois, for use outside Illinois.
33        (h)  The  use, in this State, of a motor vehicle that was
34    sold in this State to a nonresident, even  though  the  motor
 
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 1    vehicle is delivered to the nonresident in this State, if the
 2    motor  vehicle  is  not  to be titled in this State, and if a
 3    driveaway decal permit is issued  to  the  motor  vehicle  as
 4    provided  in Section 3-603 of the Illinois Vehicle Code or if
 5    the nonresident purchaser has vehicle registration plates  to
 6    transfer  to  the  motor vehicle upon returning to his or her
 7    home state.  The issuance of the driveaway  decal  permit  or
 8    having the out-of-state registration plates to be transferred
 9    shall be prima facie evidence that the motor vehicle will not
10    be titled in this State.
11        (i)  Beginning  July  1, 1999, the use, in this State, of
12    fuel acquired outside this State and brought into this  State
13    in  the  fuel  supply tanks of locomotives engaged in freight
14    hauling and passenger service for interstate  commerce.  This
15    subsection is exempt from the provisions of Section 3-90.
16        (j)  Beginning  on  January  1, 2002, the use of tangible
17    personal property purchased from an Illinois  retailer  by  a
18    taxpayer  engaged  in  centralized  purchasing  activities in
19    Illinois who will, upon receipt of the property in  Illinois,
20    temporarily  store  the  property  in  Illinois  (i)  for the
21    purpose of subsequently transporting it  outside  this  State
22    for  use  or consumption thereafter solely outside this State
23    or (ii) for the purpose of being  processed,  fabricated,  or
24    manufactured  into,  attached  to, or incorporated into other
25    tangible personal property to  be  transported  outside  this
26    State  and  thereafter  used  or consumed solely outside this
27    State.  The Director of  Revenue  shall,  pursuant  to  rules
28    adopted   in  accordance  with  the  Illinois  Administrative
29    Procedure Act,  issue  a  permit  to  any  taxpayer  in  good
30    standing   with  the  Department  who  is  eligible  for  the
31    exemption under this subsection (j).  The permit issued under
32    this subsection (j) shall authorize the holder, to the extent
33    and in the manner specified in the rules adopted  under  this
34    Act,  to  purchase tangible personal property from a retailer
 
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 1    exempt from the taxes imposed by this Act.   Taxpayers  shall
 2    maintain  all necessary books and records to substantiate the
 3    use and consumption of all such  tangible  personal  property
 4    outside of the State of Illinois.
 5    (Source: P.A.  90-519,  eff.  6-1-98;  90-552, eff. 12-12-97;
 6    91-51, eff.  6-30-99;  91-313,  eff.  7-29-99;  91-587,  eff.
 7    8-14-99; revised 9-29-99.)

 8        Section  10.   The  Service  Use  Tax  Act  is amended by
 9    changing Section 3-45 as follows:

10        (35 ILCS 110/3-45) (from Ch. 120, par. 439.33-45)
11        Sec. 3-45.  Multistate exemption. The tax imposed by this
12    Act does not apply to the use of tangible  personal  property
13    in this State under the following circumstances:
14        (a)  The use, in this State, of property acquired outside
15    this  State by a nonresident individual and brought into this
16    State by  the  individual  for  his  or  her  own  use  while
17    temporarily  within  this State or while passing through this
18    State.
19        (b)  The use, in this State, of property that is acquired
20    outside this State and that is moved into this State for  use
21    as rolling stock moving in interstate commerce.
22        (c)  The use, in this State, of property that is acquired
23    outside  this  State and caused to be brought into this State
24    by a person who has already paid a tax in  another  state  in
25    respect  to  the  sale, purchase, or use of that property, to
26    the extent of the amount of the tax properly due and paid  in
27    the other state.
28        (d)  The  temporary  storage,  in this State, of property
29    that is acquired outside this  State  and  that  after  being
30    brought  into this State and stored here temporarily, is used
31    solely outside this State or is  physically  attached  to  or
32    incorporated  into other property that is used solely outside
 
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 1    this  State,  or  is  altered  by  converting,   fabricating,
 2    manufacturing,  printing,  processing,  or  shaping,  and, as
 3    altered, is used solely outside this State.
 4        (e)  Beginning July 1, 1999, the use, in this  State,  of
 5    fuel  acquired outside this State and brought into this State
 6    in the fuel supply tanks of locomotives  engaged  in  freight
 7    hauling  and  passenger service for interstate commerce. This
 8    subsection is exempt from the provisions of Section 3-75.
 9        (f)  Beginning on January 1, 2002, the  use  of  tangible
10    personal  property  purchased  from an Illinois retailer by a
11    taxpayer engaged  in  centralized  purchasing  activities  in
12    Illinois  who will, upon receipt of the property in Illinois,
13    temporarily store  the  property  in  Illinois  (i)  for  the
14    purpose  of  subsequently  transporting it outside this State
15    for use or consumption thereafter solely outside  this  State
16    or  (ii)  for  the purpose of being processed, fabricated, or
17    manufactured into, attached to, or  incorporated  into  other
18    tangible  personal  property  to  be transported outside this
19    State and thereafter used or  consumed  solely  outside  this
20    State.   The  Director  of  Revenue  shall, pursuant to rules
21    adopted  in  accordance  with  the  Illinois   Administrative
22    Procedure  Act,  issue  a  permit  to  any  taxpayer  in good
23    standing  with  the  Department  who  is  eligible  for   the
24    exemption under this subsection (f).  The permit issued under
25    this subsection (f) shall authorize the holder, to the extent
26    and  in  the manner specified in the rules adopted under this
27    Act, to purchase tangible personal property from  a  retailer
28    exempt  from  the taxes imposed by this Act.  Taxpayers shall
29    maintain all necessary books and records to substantiate  the
30    use  and  consumption  of all such tangible personal property
31    outside of the State of Illinois.
32    (Source: P.A. 91-51,  eff.  6-30-99;  91-313,  eff.  7-29-99;
33    91-587, eff. 8-14-99; revised 9-29-99.)
 
SB730 Engrossed             -6-                LRB9204809SMdv
 1        Section 15.  The Service Occupation Tax Act is amended by
 2    changing Section 3-5 as follows:

 3        (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
 4        Sec.  3-5.   Exemptions.  The following tangible personal
 5    property is exempt from the tax imposed by this Act:
 6        (1)  Personal property sold by  a  corporation,  society,
 7    association,  foundation, institution, or organization, other
 8    than a limited  liability  company,  that  is  organized  and
 9    operated  as  a  not-for-profit  service  enterprise  for the
10    benefit of persons 65 years of age or older if  the  personal
11    property  was not purchased by the enterprise for the purpose
12    of resale by the enterprise.
13        (2)  Personal  property  purchased  by  a  not-for-profit
14    Illinois county  fair  association  for  use  in  conducting,
15    operating, or promoting the county fair.
16        (3)  Personal  property  purchased  by any not-for-profit
17    arts or cultural  organization  that  establishes,  by  proof
18    required  by  the Department by rule, that it has received an
19    exemption  under Section 501(c)(3) of  the  Internal  Revenue
20    Code  and that is organized and operated for the presentation
21    or support of arts or cultural  programming,  activities,  or
22    services.   These  organizations include, but are not limited
23    to, music and dramatic arts organizations  such  as  symphony
24    orchestras  and  theatrical groups, arts and cultural service
25    organizations,   local    arts    councils,    visual    arts
26    organizations, and media arts organizations.
27        (4)  Legal  tender,  currency,  medallions,  or  gold  or
28    silver   coinage   issued  by  the  State  of  Illinois,  the
29    government of the United States of America, or the government
30    of any foreign country, and bullion.
31        (5)  Graphic  arts  machinery  and  equipment,  including
32    repair  and  replacement  parts,  both  new  and  used,   and
33    including that manufactured on special order or purchased for
 
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 1    lease,  certified  by  the purchaser to be used primarily for
 2    graphic arts production.
 3        (6)  Personal  property  sold  by   a   teacher-sponsored
 4    student   organization   affiliated  with  an  elementary  or
 5    secondary school located in Illinois.
 6        (7)  Farm machinery and equipment,  both  new  and  used,
 7    including  that  manufactured  on special order, certified by
 8    the purchaser to be used primarily for production agriculture
 9    or  State  or  federal   agricultural   programs,   including
10    individual replacement parts for the machinery and equipment,
11    including  machinery  and  equipment purchased for lease, and
12    including implements of husbandry defined in Section 1-130 of
13    the Illinois Vehicle Code, farm  machinery  and  agricultural
14    chemical  and fertilizer spreaders, and nurse wagons required
15    to be registered under Section 3-809 of the Illinois  Vehicle
16    Code,  but  excluding  other  motor  vehicles  required to be
17    registered under the  Illinois  Vehicle  Code.  Horticultural
18    polyhouses  or  hoop houses used for propagating, growing, or
19    overwintering plants shall be considered farm  machinery  and
20    equipment  under  this item (7). Agricultural chemical tender
21    tanks and dry boxes shall include units sold separately  from
22    a  motor  vehicle  required  to  be  licensed  and units sold
23    mounted on a motor vehicle required to  be  licensed  if  the
24    selling price of the tender is separately stated.
25        Farm  machinery  and  equipment  shall  include precision
26    farming equipment  that  is  installed  or  purchased  to  be
27    installed  on farm machinery and equipment including, but not
28    limited  to,  tractors,   harvesters,   sprayers,   planters,
29    seeders,  or spreaders. Precision farming equipment includes,
30    but is not  limited  to,  soil  testing  sensors,  computers,
31    monitors,  software,  global positioning and mapping systems,
32    and other such equipment.
33        Farm machinery and  equipment  also  includes  computers,
34    sensors,  software,  and  related equipment used primarily in
 
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 1    the computer-assisted  operation  of  production  agriculture
 2    facilities,  equipment,  and  activities  such  as,  but  not
 3    limited  to,  the  collection, monitoring, and correlation of
 4    animal and crop data for the purpose  of  formulating  animal
 5    diets  and  agricultural  chemicals.  This item (7) is exempt
 6    from the provisions of Section 3-55.
 7        (8)  Fuel and petroleum products sold to or  used  by  an
 8    air  common  carrier, certified by the carrier to be used for
 9    consumption, shipment, or  storage  in  the  conduct  of  its
10    business  as an air common carrier, for a flight destined for
11    or returning from a location or locations outside the  United
12    States  without  regard  to  previous  or subsequent domestic
13    stopovers.
14        (9)  Proceeds of  mandatory  service  charges  separately
15    stated  on  customers' bills for the purchase and consumption
16    of food and beverages, to the extent that the proceeds of the
17    service charge are in fact  turned  over  as  tips  or  as  a
18    substitute for tips to the employees who participate directly
19    in  preparing,  serving,  hosting  or cleaning up the food or
20    beverage function with respect to which the service charge is
21    imposed.
22        (10)  Oil field  exploration,  drilling,  and  production
23    equipment, including (i) rigs and parts of rigs, rotary rigs,
24    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
25    goods, including casing and drill strings,  (iii)  pumps  and
26    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
27    individual  replacement  part  for  oil  field   exploration,
28    drilling,  and  production  equipment, and (vi) machinery and
29    equipment purchased for lease; but excluding  motor  vehicles
30    required to be registered under the Illinois Vehicle Code.
31        (11)  Photoprocessing  machinery and equipment, including
32    repair and replacement parts, both new  and  used,  including
33    that   manufactured   on  special  order,  certified  by  the
34    purchaser to  be  used  primarily  for  photoprocessing,  and
 
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 1    including  photoprocessing  machinery and equipment purchased
 2    for lease.
 3        (12)  Coal  exploration,  mining,   offhighway   hauling,
 4    processing, maintenance, and reclamation equipment, including
 5    replacement  parts  and  equipment,  and  including equipment
 6    purchased for lease, but excluding motor vehicles required to
 7    be registered under the Illinois Vehicle Code.
 8        (13)  Food for human consumption that is to  be  consumed
 9    off  the  premises  where  it  is  sold (other than alcoholic
10    beverages, soft drinks and food that has  been  prepared  for
11    immediate  consumption) and prescription and non-prescription
12    medicines, drugs,  medical  appliances,  and  insulin,  urine
13    testing  materials,  syringes, and needles used by diabetics,
14    for human use, when purchased for use by a  person  receiving
15    medical assistance under Article 5 of the Illinois Public Aid
16    Code  who  resides  in a licensed long-term care facility, as
17    defined in the Nursing Home Care Act.
18        (14)  Semen used for artificial insemination of livestock
19    for direct agricultural production.
20        (15)  Horses, or interests in horses, registered with and
21    meeting the requirements of any of  the  Arabian  Horse  Club
22    Registry  of  America, Appaloosa Horse Club, American Quarter
23    Horse Association, United  States  Trotting  Association,  or
24    Jockey Club, as appropriate, used for purposes of breeding or
25    racing for prizes.
26        (16)  Computers and communications equipment utilized for
27    any  hospital  purpose  and  equipment used in the diagnosis,
28    analysis, or treatment of hospital patients sold to a  lessor
29    who leases the equipment, under a lease of one year or longer
30    executed  or  in  effect  at  the  time of the purchase, to a
31    hospital  that  has  been  issued  an  active  tax  exemption
32    identification number by the Department under Section  1g  of
33    the Retailers' Occupation Tax Act.
34        (17)  Personal  property  sold to a lessor who leases the
 
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 1    property, under a lease of one year or longer executed or  in
 2    effect  at  the  time of the purchase, to a governmental body
 3    that has been issued an active tax  exemption  identification
 4    number  by  the Department under Section 1g of the Retailers'
 5    Occupation Tax Act.
 6        (18)  Beginning with taxable years  ending  on  or  after
 7    December  31, 1995 and ending with taxable years ending on or
 8    before December 31, 2004, personal property that  is  donated
 9    for  disaster  relief  to  be  used  in  a State or federally
10    declared disaster area in Illinois or bordering Illinois by a
11    manufacturer or retailer that is registered in this State  to
12    a   corporation,   society,   association,   foundation,   or
13    institution  that  has  been  issued  a  sales  tax exemption
14    identification number by the Department that assists  victims
15    of the disaster who reside within the declared disaster area.
16        (19)  Beginning  with  taxable  years  ending on or after
17    December 31, 1995 and ending with taxable years ending on  or
18    before  December  31, 2004, personal property that is used in
19    the performance of  infrastructure  repairs  in  this  State,
20    including  but  not  limited  to municipal roads and streets,
21    access roads, bridges,  sidewalks,  waste  disposal  systems,
22    water  and  sewer  line  extensions,  water  distribution and
23    purification facilities, storm water drainage  and  retention
24    facilities, and sewage treatment facilities, resulting from a
25    State or federally declared disaster in Illinois or bordering
26    Illinois  when  such  repairs  are  initiated  on  facilities
27    located  in  the declared disaster area within 6 months after
28    the disaster.
29        (20)  Beginning July 1, 1999, game or game birds sold  at
30    a  "game  breeding  and  hunting preserve area" or an "exotic
31    game hunting area" as those terms are used  in  the  Wildlife
32    Code or at a hunting enclosure approved through rules adopted
33    by  the  Department  of Natural Resources.  This paragraph is
34    exempt from the provisions of Section 3-55.
 
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 1        (21) (20)  A motor vehicle, as that term  is  defined  in
 2    Section  1-146  of the Illinois Vehicle Code, that is donated
 3    to  a  corporation,  limited  liability   company,   society,
 4    association, foundation, or institution that is determined by
 5    the  Department  to be organized and operated exclusively for
 6    educational purposes.  For purposes  of  this  exemption,  "a
 7    corporation, limited liability company, society, association,
 8    foundation, or institution organized and operated exclusively
 9    for  educational  purposes"  means  all  tax-supported public
10    schools, private schools that offer systematic instruction in
11    useful branches of  learning  by  methods  common  to  public
12    schools  and  that  compare  favorably  in  their  scope  and
13    intensity with the course of study presented in tax-supported
14    schools,  and  vocational  or technical schools or institutes
15    organized and operated exclusively to  provide  a  course  of
16    study  of  not  less  than  6  weeks duration and designed to
17    prepare individuals to follow a trade or to pursue a  manual,
18    technical,  mechanical,  industrial,  business, or commercial
19    occupation.
20        (22) (21)  Beginning January 1, 2000,  personal property,
21    including food, purchased through fundraising events for  the
22    benefit  of  a  public  or  private  elementary  or secondary
23    school, a group of those  schools,  or  one  or  more  school
24    districts if the events are sponsored by an entity recognized
25    by  the school district that consists primarily of volunteers
26    and includes parents and teachers  of  the  school  children.
27    This  paragraph  does not apply to fundraising events (i) for
28    the benefit of private home instruction or (ii) for which the
29    fundraising entity purchases the personal  property  sold  at
30    the  events  from  another individual or entity that sold the
31    property for the purpose of resale by the fundraising  entity
32    and  that  profits  from  the sale to the fundraising entity.
33    This paragraph is exempt from the provisions of Section 3-55.
34        (23)  (20)  Beginning  January  1,  2000,  new  or   used
 
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 1    automatic  vending  machines  that prepare and serve hot food
 2    and beverages, including coffee, soup, and other  items,  and
 3    replacement  parts  for  these  machines.   This paragraph is
 4    exempt from the provisions of Section 3-55.
 5        (24)  Beginning on January  1,  2002,  tangible  personal
 6    property  purchased  from  an Illinois retailer by a taxpayer
 7    engaged in centralized purchasing activities in Illinois  who
 8    will,  upon  receipt of the property in Illinois, temporarily
 9    store the  property  in  Illinois  (i)  for  the  purpose  of
10    subsequently  transporting  it  outside this State for use or
11    consumption thereafter solely outside this State or (ii)  for
12    the  purpose  of being processed, fabricated, or manufactured
13    into,  attached  to,  or  incorporated  into  other  tangible
14    personal property to be transported outside  this  State  and
15    thereafter  used  or consumed solely outside this State.  The
16    Director of Revenue  shall,  pursuant  to  rules  adopted  in
17    accordance  with  the  Illinois Administrative Procedure Act,
18    issue a permit to any taxpayer  in  good  standing  with  the
19    Department  who  is  eligible  for  the  exemption under this
20    paragraph (24).  The permit issued under this paragraph  (24)
21    shall  authorize  the holder, to the extent and in the manner
22    specified in the rules adopted under this  Act,  to  purchase
23    tangible  personal  property  from a retailer exempt from the
24    taxes imposed by this  Act.   Taxpayers  shall  maintain  all
25    necessary  books  and  records  to  substantiate  the use and
26    consumption of all such tangible personal property outside of
27    the State of Illinois.
28    (Source: P.A. 90-14,  eff.  7-1-97;  90-552,  eff.  12-12-97;
29    90-605,  eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200, eff.
30    7-20-99; 91-439, eff. 8-6-99; 91-533, eff.  8-13-99;  91-637,
31    eff. 8-20-99; 91-644, eff. 8-20-99; revised 9-29-99.)

32        Section 20.  The Retailers' Occupation Tax Act is amended
33    by changing Section 2-5 as follows:
 
SB730 Engrossed             -13-               LRB9204809SMdv
 1        (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
 2        Sec. 2-5.  Exemptions.  Gross receipts from proceeds from
 3    the  sale  of  the  following  tangible personal property are
 4    exempt from the tax imposed by this Act:
 5        (1)  Farm chemicals.
 6        (2)  Farm machinery and equipment,  both  new  and  used,
 7    including  that  manufactured  on special order, certified by
 8    the purchaser to be used primarily for production agriculture
 9    or  State  or  federal   agricultural   programs,   including
10    individual replacement parts for the machinery and equipment,
11    including  machinery  and  equipment purchased for lease, and
12    including implements of husbandry defined in Section 1-130 of
13    the Illinois Vehicle Code, farm  machinery  and  agricultural
14    chemical  and fertilizer spreaders, and nurse wagons required
15    to be registered under Section 3-809 of the Illinois  Vehicle
16    Code,  but  excluding  other  motor  vehicles  required to be
17    registered under the  Illinois  Vehicle  Code.  Horticultural
18    polyhouses  or  hoop houses used for propagating, growing, or
19    overwintering plants shall be considered farm  machinery  and
20    equipment  under  this item (2). Agricultural chemical tender
21    tanks and dry boxes shall include units sold separately  from
22    a  motor  vehicle  required  to  be  licensed  and units sold
23    mounted on a motor vehicle required to be  licensed,  if  the
24    selling price of the tender is separately stated.
25        Farm  machinery  and  equipment  shall  include precision
26    farming equipment  that  is  installed  or  purchased  to  be
27    installed  on farm machinery and equipment including, but not
28    limited  to,  tractors,   harvesters,   sprayers,   planters,
29    seeders,  or spreaders. Precision farming equipment includes,
30    but is not  limited  to,  soil  testing  sensors,  computers,
31    monitors,  software,  global positioning and mapping systems,
32    and other such equipment.
33        Farm machinery and  equipment  also  includes  computers,
34    sensors,  software,  and  related equipment used primarily in
 
SB730 Engrossed             -14-               LRB9204809SMdv
 1    the computer-assisted  operation  of  production  agriculture
 2    facilities,  equipment,  and  activities  such  as,  but  not
 3    limited  to,  the  collection, monitoring, and correlation of
 4    animal and crop data for the purpose  of  formulating  animal
 5    diets  and  agricultural  chemicals.  This item (7) is exempt
 6    from the provisions of Section 2-70.
 7        (3)  Distillation machinery and equipment, sold as a unit
 8    or kit, assembled or installed by the retailer, certified  by
 9    the  user to be used only for the production of ethyl alcohol
10    that will be used for consumption  as  motor  fuel  or  as  a
11    component of motor fuel for the personal use of the user, and
12    not subject to sale or resale.
13        (4)  Graphic  arts  machinery  and  equipment,  including
14    repair   and  replacement  parts,  both  new  and  used,  and
15    including that manufactured on special order or purchased for
16    lease, certified by the purchaser to be  used  primarily  for
17    graphic arts production.
18        (5)  A  motor  vehicle  of  the  first  division, a motor
19    vehicle of the second division that is a self-contained motor
20    vehicle designed or permanently converted to  provide  living
21    quarters  for  recreational,  camping,  or  travel  use, with
22    direct walk through access to the living  quarters  from  the
23    driver's seat, or a motor vehicle of the second division that
24    is  of  the van configuration designed for the transportation
25    of not less than 7 nor more than 16 passengers, as defined in
26    Section 1-146 of the Illinois Vehicle Code, that is used  for
27    automobile  renting,  as  defined  in  the Automobile Renting
28    Occupation and Use Tax Act.
29        (6)  Personal  property  sold  by   a   teacher-sponsored
30    student   organization   affiliated  with  an  elementary  or
31    secondary school located in Illinois.
32        (7)  Proceeds of that portion of the selling price  of  a
33    passenger car the sale of which is subject to the Replacement
34    Vehicle Tax.
 
SB730 Engrossed             -15-               LRB9204809SMdv
 1        (8)  Personal  property  sold  to an Illinois county fair
 2    association for use in conducting,  operating,  or  promoting
 3    the county fair.
 4        (9)  Personal  property  sold to a not-for-profit arts or
 5    cultural organization that establishes, by proof required  by
 6    the  Department  by  rule,  that it has received an exemption
 7    under Section 501(c)(3) of the Internal Revenue Code and that
 8    is organized and operated for the presentation or support  of
 9    arts or cultural programming, activities, or services.  These
10    organizations  include,  but  are  not  limited to, music and
11    dramatic arts organizations such as symphony  orchestras  and
12    theatrical  groups,  arts and cultural service organizations,
13    local arts councils, visual  arts  organizations,  and  media
14    arts organizations.
15        (10)  Personal  property  sold by a corporation, society,
16    association, foundation, institution, or organization,  other
17    than  a  limited  liability  company,  that  is organized and
18    operated as  a  not-for-profit  service  enterprise  for  the
19    benefit  of  persons 65 years of age or older if the personal
20    property was not purchased by the enterprise for the  purpose
21    of resale by the enterprise.
22        (11)  Personal property sold to a governmental body, to a
23    corporation, society, association, foundation, or institution
24    organized and operated exclusively for charitable, religious,
25    or  educational purposes, or to a not-for-profit corporation,
26    society,    association,    foundation,    institution,    or
27    organization that has no compensated  officers  or  employees
28    and   that  is  organized  and  operated  primarily  for  the
29    recreation of persons 55 years of age  or  older.  A  limited
30    liability  company  may  qualify for the exemption under this
31    paragraph only if the limited liability company is  organized
32    and  operated  exclusively  for  educational purposes. On and
33    after July 1, 1987, however, no entity otherwise eligible for
34    this exemption shall make tax-free purchases unless it has an
 
SB730 Engrossed             -16-               LRB9204809SMdv
 1    active identification number issued by the Department.
 2        (12)  Personal property sold to interstate  carriers  for
 3    hire  for  use as rolling stock moving in interstate commerce
 4    or to lessors under leases of one year or longer executed  or
 5    in  effect at the time of purchase by interstate carriers for
 6    hire for use as rolling stock moving in  interstate  commerce
 7    and  equipment  operated  by  a  telecommunications provider,
 8    licensed as a common carrier by  the  Federal  Communications
 9    Commission,  which  is permanently installed in or affixed to
10    aircraft moving in interstate commerce.
11        (13)  Proceeds from sales to owners, lessors, or shippers
12    of tangible personal property that is utilized by  interstate
13    carriers  for  hire  for  use  as  rolling  stock  moving  in
14    interstate    commerce    and   equipment   operated   by   a
15    telecommunications provider, licensed as a common carrier  by
16    the  Federal  Communications Commission, which is permanently
17    installed in or affixed  to  aircraft  moving  in  interstate
18    commerce.
19        (14)  Machinery  and  equipment  that will be used by the
20    purchaser, or a lessee of the  purchaser,  primarily  in  the
21    process  of  manufacturing  or  assembling  tangible personal
22    property for wholesale or retail sale or lease,  whether  the
23    sale or lease is made directly by the manufacturer or by some
24    other  person,  whether the materials used in the process are
25    owned by the manufacturer or some other  person,  or  whether
26    the sale or lease is made apart from or as an incident to the
27    seller's  engaging  in  the  service  occupation of producing
28    machines, tools,  dies,  jigs,  patterns,  gauges,  or  other
29    similar  items  of no commercial value on special order for a
30    particular purchaser.
31        (15)  Proceeds of mandatory  service  charges  separately
32    stated  on  customers'  bills for purchase and consumption of
33    food and beverages, to the extent that the  proceeds  of  the
34    service  charge  are  in  fact  turned  over  as tips or as a
 
SB730 Engrossed             -17-               LRB9204809SMdv
 1    substitute for tips to the employees who participate directly
 2    in preparing, serving, hosting or cleaning  up  the  food  or
 3    beverage function with respect to which the service charge is
 4    imposed.
 5        (16)  Petroleum  products  sold  to  a  purchaser  if the
 6    seller is prohibited by federal law from charging tax to  the
 7    purchaser.
 8        (17)  Tangible personal property sold to a common carrier
 9    by rail or motor that receives the physical possession of the
10    property  in  Illinois  and  that transports the property, or
11    shares with another common carrier in the  transportation  of
12    the  property,  out of Illinois on a standard uniform bill of
13    lading showing the seller of the property as the  shipper  or
14    consignor  of the property to a destination outside Illinois,
15    for use outside Illinois.
16        (18)  Legal tender,  currency,  medallions,  or  gold  or
17    silver   coinage   issued  by  the  State  of  Illinois,  the
18    government of the United States of America, or the government
19    of any foreign country, and bullion.
20        (19)  Oil field  exploration,  drilling,  and  production
21    equipment, including (i) rigs and parts of rigs, rotary rigs,
22    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
23    goods, including casing and drill strings,  (iii)  pumps  and
24    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
25    individual  replacement  part  for  oil  field   exploration,
26    drilling,  and  production  equipment, and (vi) machinery and
27    equipment purchased for lease; but excluding  motor  vehicles
28    required to be registered under the Illinois Vehicle Code.
29        (20)  Photoprocessing  machinery and equipment, including
30    repair and replacement parts, both new  and  used,  including
31    that   manufactured   on  special  order,  certified  by  the
32    purchaser to  be  used  primarily  for  photoprocessing,  and
33    including  photoprocessing  machinery and equipment purchased
34    for lease.
 
SB730 Engrossed             -18-               LRB9204809SMdv
 1        (21)  Coal  exploration,  mining,   offhighway   hauling,
 2    processing, maintenance, and reclamation equipment, including
 3    replacement  parts  and  equipment,  and  including equipment
 4    purchased for lease, but excluding motor vehicles required to
 5    be registered under the Illinois Vehicle Code.
 6        (22)  Fuel and petroleum products sold to or used  by  an
 7    air  carrier,  certified  by  the  carrier  to  be  used  for
 8    consumption,  shipment,  or  storage  in  the  conduct of its
 9    business as an air common carrier, for a flight destined  for
10    or  returning from a location or locations outside the United
11    States without regard  to  previous  or  subsequent  domestic
12    stopovers.
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 to
16    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)  A motor vehicle sold in this State to a nonresident
24    even though the motor vehicle is delivered to the nonresident
25    in  this  State,  if the motor vehicle is not to be titled in
26    this State, and if a driveaway decal permit is issued to  the
27    motor  vehicle  as  provided in Section 3-603 of the Illinois
28    Vehicle Code or if  the  nonresident  purchaser  has  vehicle
29    registration  plates  to  transfer  to the motor vehicle upon
30    returning to his or her home  state.   The  issuance  of  the
31    driveaway   decal   permit   or   having   the   out-of-state
32    registration plates to be transferred is prima facie evidence
33    that the motor vehicle will not be titled in this State.
34        (26)  Semen used for artificial insemination of livestock
 
SB730 Engrossed             -19-               LRB9204809SMdv
 1    for direct agricultural production.
 2        (27)  Horses, or interests in horses, registered with and
 3    meeting  the  requirements  of  any of the Arabian Horse Club
 4    Registry of America, Appaloosa Horse Club,  American  Quarter
 5    Horse  Association,  United  States  Trotting Association, or
 6    Jockey Club, as appropriate, used for purposes of breeding or
 7    racing for prizes.
 8        (28)  Computers and communications equipment utilized for
 9    any hospital purpose and equipment  used  in  the  diagnosis,
10    analysis,  or treatment of hospital patients sold to a lessor
11    who leases the equipment, under a lease of one year or longer
12    executed or in effect at the  time  of  the  purchase,  to  a
13    hospital  that  has  been  issued  an  active  tax  exemption
14    identification  number  by the Department under Section 1g of
15    this Act.
16        (29)  Personal property sold to a lessor who  leases  the
17    property,  under a lease of one year or longer executed or in
18    effect at the time of the purchase, to  a  governmental  body
19    that  has  been issued an active tax exemption identification
20    number by the Department under Section 1g of this Act.
21        (30)  Beginning with taxable years  ending  on  or  after
22    December  31, 1995 and ending with taxable years ending on or
23    before December 31, 2004, personal property that  is  donated
24    for  disaster  relief  to  be  used  in  a State or federally
25    declared disaster area in Illinois or bordering Illinois by a
26    manufacturer or retailer that is registered in this State  to
27    a   corporation,   society,   association,   foundation,   or
28    institution  that  has  been  issued  a  sales  tax exemption
29    identification number by the Department that assists  victims
30    of the disaster who reside within the declared disaster area.
31        (31)  Beginning  with  taxable  years  ending on or after
32    December 31, 1995 and ending with taxable years ending on  or
33    before  December  31, 2004, personal property that is used in
34    the performance of  infrastructure  repairs  in  this  State,
 
SB730 Engrossed             -20-               LRB9204809SMdv
 1    including  but  not  limited  to municipal roads and streets,
 2    access roads, bridges,  sidewalks,  waste  disposal  systems,
 3    water  and  sewer  line  extensions,  water  distribution and
 4    purification facilities, storm water drainage  and  retention
 5    facilities, and sewage treatment facilities, resulting from a
 6    State or federally declared disaster in Illinois or bordering
 7    Illinois  when  such  repairs  are  initiated  on  facilities
 8    located  in  the declared disaster area within 6 months after
 9    the disaster.
10        (32)  Beginning July 1, 1999, game or game birds sold  at
11    a  "game  breeding  and  hunting preserve area" or an "exotic
12    game hunting area" as those terms are used  in  the  Wildlife
13    Code or at a hunting enclosure approved through rules adopted
14    by  the  Department  of Natural Resources.  This paragraph is
15    exempt from the provisions of Section 2-70.
16        (33) (32)  A motor vehicle, as that term  is  defined  in
17    Section  1-146  of the Illinois Vehicle Code, that is donated
18    to  a  corporation,  limited  liability   company,   society,
19    association, foundation, or institution that is determined by
20    the  Department  to be organized and operated exclusively for
21    educational purposes.  For purposes  of  this  exemption,  "a
22    corporation, limited liability company, society, association,
23    foundation, or institution organized and operated exclusively
24    for  educational  purposes"  means  all  tax-supported public
25    schools, private schools that offer systematic instruction in
26    useful branches of  learning  by  methods  common  to  public
27    schools  and  that  compare  favorably  in  their  scope  and
28    intensity with the course of study presented in tax-supported
29    schools,  and  vocational  or technical schools or institutes
30    organized and operated exclusively to  provide  a  course  of
31    study  of  not  less  than  6  weeks duration and designed to
32    prepare individuals to follow a trade or to pursue a  manual,
33    technical,  mechanical,  industrial,  business, or commercial
34    occupation.
 
SB730 Engrossed             -21-               LRB9204809SMdv
 1        (34) (33)  Beginning January 1, 2000,  personal property,
 2    including food, purchased through fundraising events for  the
 3    benefit  of  a  public  or  private  elementary  or secondary
 4    school, a group of those  schools,  or  one  or  more  school
 5    districts if the events are sponsored by an entity recognized
 6    by  the school district that consists primarily of volunteers
 7    and includes parents and teachers  of  the  school  children.
 8    This  paragraph  does not apply to fundraising events (i) for
 9    the benefit of private home instruction or (ii) for which the
10    fundraising entity purchases the personal  property  sold  at
11    the  events  from  another individual or entity that sold the
12    property for the purpose of resale by the fundraising  entity
13    and  that  profits  from  the sale to the fundraising entity.
14    This paragraph is exempt from the provisions of Section 2-70.
15        (35)  (32)  Beginning  January  1,  2000,  new  or   used
16    automatic  vending  machines  that prepare and serve hot food
17    and beverages, including coffee, soup, and other  items,  and
18    replacement  parts  for  these  machines.   This paragraph is
19    exempt from the provisions of Section 2-70.
20        (36)  Beginning on January  1,  2002,  tangible  personal
21    property  purchased  from  an Illinois retailer by a taxpayer
22    engaged in centralized purchasing activities in Illinois  who
23    will,  upon  receipt of the property in Illinois, temporarily
24    store the  property  in  Illinois  (i)  for  the  purpose  of
25    subsequently  transporting  it  outside this State for use or
26    consumption thereafter solely outside this State or (ii)  for
27    the  purpose  of being processed, fabricated, or manufactured
28    into,  attached  to,  or  incorporated  into  other  tangible
29    personal property to be transported outside  this  State  and
30    thereafter  used  or consumed solely outside this State.  The
31    Director of Revenue  shall,  pursuant  to  rules  adopted  in
32    accordance  with  the  Illinois Administrative Procedure Act,
33    issue a permit to any taxpayer  in  good  standing  with  the
34    Department  who  is  eligible  for  the  exemption under this
 
SB730 Engrossed             -22-               LRB9204809SMdv
 1    paragraph (36).  The permit issued under this paragraph  (36)
 2    shall  authorize  the holder, to the extent and in the manner
 3    specified in the rules adopted under this  Act,  to  purchase
 4    tangible  personal  property  from a retailer exempt from the
 5    taxes imposed by this  Act.   Taxpayers  shall  maintain  all
 6    necessary  books  and  records  to  substantiate  the use and
 7    consumption of all such tangible personal property outside of
 8    the State of Illinois.
 9    (Source: P.A.  90-14,  eff.  7-1-97;  90-519,  eff.   6-1-98;
10    90-552,  eff.  12-12-97;  90-605,  eff.  6-30-98; 91-51, eff.
11    6-30-99; 91-200, eff. 7-20-99; 91-439, eff.  8-6-99;  91-533,
12    eff.  8-13-99;  91-637,  eff.  8-20-99; 91-644, eff. 8-20-99;
13    revised 9-28-99.)

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

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