95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
HB3732


 
Introduced 2/28/2007, by Rep. Timothy L. Schmitz
 
SYNOPSIS AS INTRODUCED:
 		













35 ILCS 105/3b new






35 ILCS 120/2-75 new










    Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides that no  tax is imposed under the Acts upon the privilege of using in this State (for the Use Tax Act) or persons engaged in the business of selling at retail (for the Retailers' Occupation Tax Act) qualified school supplies  that are  purchased from 12:01 a.m. on the first Thursday in August through midnight of the Sunday that follows 10 days later. Provides that the Department of Revenue shall define "qualified school supplies" by rule. Sets forth criteria for transactions to qualify for the exemption.  Effective immediately.
















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FISCAL NOTE ACT MAY APPLY
















 


 


A BILL FOR









 











HB3732

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1
    AN ACT concerning revenue.

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


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

 
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    (35 ILCS 105/3b  new)
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    Sec. 3b. Back-To-School Tax Holiday.
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    (a) No tax is imposed under this Act upon the privilege of 
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using, in this State, qualified  school supplies that are  
10
purchased at retail from a retailer if the qualified  school 
11
supplies are  purchased during the holiday period.
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    (b) For the purpose of this Section:
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    "Holiday period" means the period from 12:01 a.m. on the 
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first Thursday in August through
midnight of the Sunday that 
15
follows 10 days later.
16
    "Qualified  school supplies" means those items defined as 
17
qualified school supplies by the Department of Revenue by rule.
18
    (c) For purpose of this Section, a "purchase" occurs
during 
19
the tax holiday if the buyer places an order and pays
the 
20
purchase price by cash or credit during the tax holiday
period 
21
regardless of whether the delivery of the item occurs
after the 
22
tax holiday period.
23
    A qualified school supply  that is placed in a layaway or 
 


 






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similar deferred plan during the holiday period is not eligible 
2
for the exemption unless the item is delivered to the purchaser 
3
during the period. An item that was placed in a layaway or 
4
similar deferred plan before the holiday period and is then 
5
delivered to the purchaser during the holiday period is 
6
eligible for the exemption.
7
    (d) Qualified merchandise that customers purchase during 
8
the holiday period with the use of a rain check qualify for the 
9
holiday regardless of when the rain check was issued. The 
10
issuance of a rain check, however, during the holiday period 
11
does not qualify  merchandise for the exemption if the 
12
merchandise is actually purchased after the holiday period.
13
    (e) If a customer purchases an item of qualified 
14
merchandise during the holiday period but later exchanges the 
15
item for a substantially similar item of a different size, 
16
different color, or other feature, then no additional tax is 
17
due even if the exchange is made after the holiday period.
18
    If a customer purchases an item of qualified merchandise 
19
during the holiday period, but after the holiday period has 
20
ended, the customer returns the item and receives credit on the 
21
purchase of a different item, then the newly purchased item is 
22
subject to the full tax rate.
23
    If a customer purchases an item of qualified merchandise 
24
before the holiday period, but during the holiday period, the 
25
customer returns the item and receives credit on the purchase 
26
of a different item of qualified merchandise, then the newly 
 


 






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purchased item is subject to the exemption.

2
    (f) Each unit of local government that imposes a use tax

3
may, by resolution or ordinance, declare a tax holiday with

4
respect to its use tax for the same items, during the same

5
periods, and under the same conditions and is encouraged to do

6
so.
 
7
    Section 10. The Retailers' Occupation Tax Act is amended  by 
8
adding Section 2-75 as follows:
 
9
    (35 ILCS 120/2-75  new)
10
    Sec. 2-75. Back-To-School Tax Holiday.
11
    (a) No tax is imposed under this Act upon persons engaged 
12
in the business of selling, at retail,  qualified  school 
13
supplies that are  purchased at retail from a retailer if the 
14
qualified  school supplies are  purchased during the holiday 
15
period.
16
    (b) For the purpose of this Section:
17
    "Holiday period" means the period from 12:01 a.m. on the 
18
first Thursday in August through
midnight of the Sunday that 
19
follows 10 days later.
20
    "Qualified  school supplies" means those items defined as 
21
qualified school supplies by the Department of Revenue by rule.
22
    (c) For purpose of this Section, a "purchase" occurs
during 
23
the tax holiday if the buyer places an order and pays
the 
24
purchase price by cash or credit during the tax holiday
period 
 


 






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1
regardless of whether the delivery of the item occurs
after the 
2
tax holiday period.
3
    A qualified school supply  that is placed in a layaway or 
4
similar deferred plan during the holiday period is not eligible 
5
for the exemption unless the item is delivered to the purchaser 
6
during the period. An item that was placed in a layaway or 
7
similar deferred plan before the holiday period and is then 
8
delivered to the purchaser during the holiday period is 
9
eligible for the exemption.
10
    (d) Qualified merchandise that customers purchase during 
11
the holiday period with the use of a rain check qualify for the 
12
holiday regardless of when the rain check was issued. The 
13
issuance of a rain check, however, during the holiday period 
14
does not qualify  merchandise for the exemption if the 
15
merchandise is actually purchased after the holiday period.
16
    (e) If a customer purchases an item of qualified 
17
merchandise during the holiday period but later exchanges the 
18
item for a substantially similar item of a different size, 
19
different color, or other feature, then no additional tax is 
20
due even if the exchange is made after the holiday period.
21
    If a customer purchases an item of qualified merchandise 
22
during the holiday period, but after the holiday period has 
23
ended, the customer returns the item and receives credit on the 
24
purchase of a different item, then the newly purchased item is 
25
subject to the full tax rate.
26
    If a customer purchases an item of qualified merchandise 
 


 






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1
before the holiday period, but during the holiday period, the 
2
customer returns the item and receives credit on the purchase 
3
of a different item of qualified merchandise, then the newly 
4
purchased item is subject to the exemption.

5
    (f) Each unit of local government that imposes a use tax

6
may, by resolution or ordinance, declare a tax holiday with

7
respect to its use tax for the same items, during the same

8
periods, and under the same conditions and is encouraged to do

9
so.
 

10
    Section 99. Effective date. This Act takes effect upon 
11
becoming law.