SB0044ham004 96TH GENERAL ASSEMBLY

Rep. Arthur L. Turner

Filed: 5/4/2010

09600SB0044ham004 LRB096 03720 HLH 40487 a

AMENDMENT TO SENATE BILL 44

AMENDMENT NO. ______. Amend Senate Bill 44 on page 22, immediately below line 11, by inserting the following:

"Section 20. The Tobacco Products Tax Act of 1995 is amended by changing Sections 10-5 and 10-10 as follows:

(35 ILCS 143/10-5)

Sec. 10-5. Definitions. For purposes of this Act:

"Business" means any trade, occupation, activity, or enterprise engaged in, at any location whatsoever, for the purpose of selling tobacco products.

"Cigarette" has the meaning ascribed to the term in Section 1 of the Cigarette Tax Act.

"Correctional Industries program" means a program run by a State penal institution in which residents of the penal institution produce tobacco products for sale to persons incarcerated in penal institutions or resident patients of a State operated mental health facility.

"Department" means the Illinois Department of Revenue.

"Distributor" means any of the following:

(1) Any manufacturer or wholesaler in this State engaged in the business of selling tobacco products who sells, exchanges, or distributes tobacco products to retailers or consumers in this State.

(2) Any manufacturer or wholesaler engaged in the business of selling tobacco products from without this State who sells, exchanges, distributes, ships, or transports tobacco products to retailers or consumers located in this State, so long as that manufacturer or wholesaler has or maintains within this State, directly or by subsidiary, an office, sales house, or other place of business, or any agent or other representative operating within this State under the authority of the person or subsidiary, irrespective of whether the place of business or agent or other representative is located here permanently or temporarily.

(3) Any retailer who receives tobacco products on which the tax has not been or will not be paid by another distributor.

"Distributor" does not include any person, wherever resident or located, who makes, manufactures, or fabricates tobacco products as part of a Correctional Industries program for sale to residents incarcerated in penal institutions or resident patients of a State operated mental health facility.

"Manufacturer" means any person, wherever resident or located, who manufactures and sells tobacco products, except a person who makes, manufactures, or fabricates tobacco products as a part of a Correctional Industries program for sale to persons incarcerated in penal institutions or resident patients of a State operated mental health facility.

"Moist snuff" means finely cut, ground, or powdered tobacco that has a moisture content of no less than 45% and is not offered in individual single-dose tablets or other discrete single-use units.

"Person" means any natural individual, firm, partnership, association, joint stock company, joint venture, limited liability company, or public or private corporation, however formed, or a receiver, executor, administrator, trustee, conservator, or other representative appointed by order of any court.

"Place of business" means and includes any place where tobacco products are sold or where tobacco products are manufactured, stored, or kept for the purpose of sale or consumption, including any vessel, vehicle, airplane, train, or vending machine.

"Retailer" means any person in this State engaged in the business of selling tobacco products to consumers in this State, regardless of quantity or number of sales.

"Sale" means any transfer, exchange, or barter in any manner or by any means whatsoever for a consideration and includes all sales made by persons.

"Tobacco products" means any cigars; cheroots; stogies; periques; granulated, plug cut, crimp cut, ready rubbed, and other smoking tobacco; snuff or snuff flour; cavendish; plug and twist tobacco; fine-cut and other chewing tobaccos; shorts; refuse scraps, clippings, cuttings, and sweeping of tobacco; and other kinds and forms of tobacco, prepared in such manner as to be suitable for chewing or smoking in a pipe or otherwise, or both for chewing and smoking; but does not include cigarettes or tobacco purchased for the manufacture of cigarettes by cigarette distributors and manufacturers defined in the Cigarette Tax Act and persons who make, manufacture, or fabricate cigarettes as a part of a Correctional Industries program for sale to residents incarcerated in penal institutions or resident patients of a State operated mental health facility.

"Wholesale price" means the established list price for which a manufacturer sells tobacco products to a distributor, before the allowance of any discount, trade allowance, rebate, or other reduction. In the absence of such an established list price, the manufacturer's invoice price at which the manufacturer sells the tobacco product to unaffiliated distributors, before any discounts, trade allowances, rebates, or other reductions, shall be presumed to be the wholesale price.

"Wholesaler" means any person, wherever resident or located, engaged in the business of selling tobacco products to others for the purpose of resale.

(Source: P.A. 92-231, eff. 8-2-01.)

(35 ILCS 143/10-10)

Sec. 10-10. Tax imposed. On the first day of the third month after the month in which this Act becomes law and through first day of the first month to occur not less than 60 days after the effective date of this amendatory Act of the 96th General Assembly, a tax is imposed on any person engaged in business as a distributor of tobacco products, as defined in Section 10-5, at the rate of 18% of the wholesale price of tobacco products sold or otherwise disposed of to retailers or consumers located in this State. Beginning on the first day of the first month to occur not less than 60 days after the effective date of this amendatory Act of the 96th General Assembly, the tax shall be imposed at the rate of 30% of the wholesale price of tobacco products, other than moist snuff, sold or otherwise disposed of to retailers or consumers located in this State. Beginning on the first day of the first month to occur not less than 60 days after the effective date of this amendatory Act of the 96th General Assembly, the tax shall be imposed on moist snuff at the rate of $0.60 per ounce. The taxes imposed by this Section shall be applied to the wholesale price of tobacco products before any other applicable tax imposed by the State, by the federal government, or by a unit of local government. The tax is in addition to all other occupation or privilege taxes imposed by the State of Illinois, by any political subdivision thereof, or by any municipal corporation. However, the tax is not imposed upon any activity in that business in interstate commerce or otherwise, to the extent to which that activity may not, under the Constitution and Statutes of the United States, be made the subject of taxation by this State. The tax is also not imposed on sales made to the United States or any entity thereof.

For returns due prior to the effective date of the tax increase imposed by this amendatory Act of the 96th General Assembly, all All moneys received by the Department under this Act shall be paid into the Long-Term Care Provider Fund of the State Treasury. For returns due on or after the effective date of the tax increase imposed by this amendatory Act of the 96th General Assembly, 78.92% of the moneys received by the Department under this Act shall be paid into the Long-Term Care Provider Fund; 10.54% of the moneys received by the Department under this Act shall be paid into the Healthcare Provider Relief Fund; and 10.54% of the moneys received under this Act shall be remitted to the Illinois Department of Public Health for support of tobacco prevention, cessation, and control programs in accordance with the Centers for Disease Control and Prevention's 2007 Best Practices for Comprehensive Tobacco Control Programs.

(Source: P.A. 92-231, eff. 8-2-01.)".