99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB2413

 

Introduced 2/3/2016, by Sen. Jim Oberweis

 

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 tangible personal property produced by a manufacturer and provided free of charge to consumers as a sample of the manufacturer's product for the purpose of encouraging consumers to purchase the same or similar items produced by the manufacturer is exempt from taxation under the Acts. Excludes the exemption from the Acts' automatic sunset provisions. Effective immediately.


LRB099 18147 HLH 42514 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB2413LRB099 18147 HLH 42514 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 the effective date
7of this amendatory Act of the 92nd General Assembly, however,
8an entity otherwise eligible for this exemption shall not make
9tax-free purchases unless it has an active identification
10number 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.
12    (7) Farm chemicals.
13    (8) Legal tender, currency, medallions, or gold or silver
14coinage issued by the State of Illinois, the government of the
15United States of America, or the government of any foreign
16country, and bullion.
17    (9) Personal property purchased from a teacher-sponsored
18student organization affiliated with an elementary or
19secondary school located in Illinois.
20    (10) A motor vehicle that is used for automobile renting,
21as defined in the Automobile Renting Occupation and Use Tax
22Act.
23    (11) Farm machinery and equipment, both new and used,
24including that manufactured on special order, certified by the
25purchaser to be used primarily for production agriculture or
26State or federal agricultural programs, including individual

 

 

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

 

 

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

 

 

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1turned over as tips or as a substitute for tips to the
2employees who participate directly in preparing, serving,
3hosting or cleaning up the food or beverage function with
4respect to which the service charge is imposed.
5    (14) Until July 1, 2003, oil field exploration, drilling,
6and production equipment, including (i) rigs and parts of rigs,
7rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
8tubular goods, including casing and drill strings, (iii) pumps
9and pump-jack units, (iv) storage tanks and flow lines, (v) any
10individual replacement part for oil field exploration,
11drilling, and production equipment, and (vi) machinery and
12equipment purchased for lease; but excluding motor vehicles
13required to be registered under the Illinois Vehicle Code.
14    (15) Photoprocessing machinery and equipment, including
15repair and replacement parts, both new and used, including that
16manufactured on special order, certified by the purchaser to be
17used primarily for photoprocessing, and including
18photoprocessing machinery and equipment purchased for lease.
19    (16) Coal and aggregate exploration, mining, off-highway
20hauling, processing, maintenance, and reclamation equipment,
21including replacement parts and equipment, and including
22equipment purchased for lease, but excluding motor vehicles
23required to be registered under the Illinois Vehicle Code. The
24changes made to this Section by Public Act 97-767 apply on and
25after July 1, 2003, but no claim for credit or refund is
26allowed on or after August 16, 2013 (the effective date of

 

 

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

 

 

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1customers through pipes, pipelines, or mains. The provisions of
2Public Act 98-583 are declaratory of existing law as to the
3meaning and scope of this exemption.
4    (19) Personal property delivered to a purchaser or
5purchaser's donee inside Illinois when the purchase order for
6that personal property was received by a florist located
7outside Illinois who has a florist located inside Illinois
8deliver the personal property.
9    (20) Semen used for artificial insemination of livestock
10for direct agricultural production.
11    (21) Horses, or interests in horses, registered with and
12meeting the requirements of any of the Arabian Horse Club
13Registry of America, Appaloosa Horse Club, American Quarter
14Horse Association, United States Trotting Association, or
15Jockey Club, as appropriate, used for purposes of breeding or
16racing for prizes. This item (21) is exempt from the provisions
17of Section 3-90, and the exemption provided for under this item
18(21) applies for all periods beginning May 30, 1995, but no
19claim for credit or refund is allowed on or after January 1,
202008 for such taxes paid during the period beginning May 30,
212000 and ending on January 1, 2008.
22    (22) Computers and communications equipment utilized for
23any hospital purpose and equipment used in the diagnosis,
24analysis, or treatment of hospital patients purchased by a
25lessor who leases the equipment, under a lease of one year or
26longer executed or in effect at the time the lessor would

 

 

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

 

 

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

 

 

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1but not limited to municipal roads and streets, access roads,
2bridges, sidewalks, waste disposal systems, water and sewer
3line extensions, water distribution and purification
4facilities, storm water drainage and retention facilities, and
5sewage treatment facilities, resulting from a State or
6federally declared disaster in Illinois or bordering Illinois
7when such repairs are initiated on facilities located in the
8declared disaster area within 6 months after the disaster.
9    (26) Beginning July 1, 1999, game or game birds purchased
10at a "game breeding and hunting preserve area" as that term is
11used in the Wildlife Code. This paragraph is exempt from the
12provisions of Section 3-90.
13    (27) A motor vehicle, as that term is defined in Section
141-146 of the Illinois Vehicle Code, that is donated to a
15corporation, limited liability company, society, association,
16foundation, or institution that is determined by the Department
17to be organized and operated exclusively for educational
18purposes. For purposes of this exemption, "a corporation,
19limited liability company, society, association, foundation,
20or institution organized and operated exclusively for
21educational purposes" means all tax-supported public schools,
22private schools that offer systematic instruction in useful
23branches of learning by methods common to public schools and
24that compare favorably in their scope and intensity with the
25course of study presented in tax-supported schools, and
26vocational or technical schools or institutes organized and

 

 

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1operated exclusively to provide a course of study of not less
2than 6 weeks duration and designed to prepare individuals to
3follow a trade or to pursue a manual, technical, mechanical,
4industrial, business, or commercial occupation.
5    (28) Beginning January 1, 2000, personal property,
6including food, purchased through fundraising events for the
7benefit of a public or private elementary or secondary school,
8a group of those schools, or one or more school districts if
9the events are sponsored by an entity recognized by the school
10district that consists primarily of volunteers and includes
11parents and teachers of the school children. This paragraph
12does not apply to fundraising events (i) for the benefit of
13private home instruction or (ii) for which the fundraising
14entity purchases the personal property sold at the events from
15another individual or entity that sold the property for the
16purpose of resale by the fundraising entity and that profits
17from the sale to the fundraising entity. This paragraph is
18exempt from the provisions of Section 3-90.
19    (29) Beginning January 1, 2000 and through December 31,
202001, new or used automatic vending machines that prepare and
21serve hot food and beverages, including coffee, soup, and other
22items, and replacement parts for these machines. Beginning
23January 1, 2002 and through June 30, 2003, machines and parts
24for machines used in commercial, coin-operated amusement and
25vending business if a use or occupation tax is paid on the
26gross receipts derived from the use of the commercial,

 

 

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1coin-operated amusement and vending machines. This paragraph
2is exempt from the provisions of Section 3-90.
3    (30) Beginning January 1, 2001 and through June 30, 2016,
4food for human consumption that is to be consumed off the
5premises where it is sold (other than alcoholic beverages, soft
6drinks, and food that has been prepared for immediate
7consumption) and prescription and nonprescription medicines,
8drugs, medical appliances, and insulin, urine testing
9materials, syringes, and needles used by diabetics, for human
10use, when purchased for use by a person receiving medical
11assistance under Article V of the Illinois Public Aid Code who
12resides in a licensed long-term care facility, as defined in
13the Nursing Home Care Act, or in a licensed facility as defined
14in the ID/DD Community Care Act, the MC/DD Act, or the
15Specialized Mental Health Rehabilitation Act of 2013.
16    (31) Beginning on the effective date of this amendatory Act
17of the 92nd General Assembly, computers and communications
18equipment utilized for any hospital purpose and equipment used
19in the diagnosis, analysis, or treatment of hospital patients
20purchased by a lessor who leases the equipment, under a lease
21of one year or longer executed or in effect at the time the
22lessor would otherwise be subject to the tax imposed by this
23Act, to a hospital that has been issued an active tax exemption
24identification number by the Department under Section 1g of the
25Retailers' Occupation Tax Act. If the equipment is leased in a
26manner that does not qualify for this exemption or is used in

 

 

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

 

 

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1market value of the property at the time the nonqualifying use
2occurs. No lessor shall collect or attempt to collect an amount
3(however designated) that purports to reimburse that lessor for
4the tax imposed by this Act or the Service Use Tax Act, as the
5case may be, if the tax has not been paid by the lessor. If a
6lessor improperly collects any such amount from the lessee, the
7lessee shall have a legal right to claim a refund of that
8amount from the lessor. If, however, that amount is not
9refunded to the lessee for any reason, the lessor is liable to
10pay that amount to the Department. This paragraph is exempt
11from the provisions of Section 3-90.
12    (33) On and after July 1, 2003 and through June 30, 2004,
13the use in this State of motor vehicles of the second division
14with a gross vehicle weight in excess of 8,000 pounds and that
15are subject to the commercial distribution fee imposed under
16Section 3-815.1 of the Illinois Vehicle Code. Beginning on July
171, 2004 and through June 30, 2005, the use in this State of
18motor vehicles of the second division: (i) with a gross vehicle
19weight rating in excess of 8,000 pounds; (ii) that are subject
20to the commercial distribution fee imposed under Section
213-815.1 of the Illinois Vehicle Code; and (iii) that are
22primarily used for commercial purposes. Through June 30, 2005,
23this exemption applies to repair and replacement parts added
24after the initial purchase of such a motor vehicle if that
25motor vehicle is used in a manner that would qualify for the
26rolling stock exemption otherwise provided for in this Act. For

 

 

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1purposes of this paragraph, the term "used for commercial
2purposes" means the transportation of persons or property in
3furtherance of any commercial or industrial enterprise,
4whether for-hire or not.
5    (34) 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 3-90.
12    (35) 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

 

 

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1tangible personal property by persons who modify, refurbish,
2complete, repair, replace, or maintain aircraft and who (i)
3hold an Air Agency Certificate and are empowered to operate an
4approved repair station by the Federal Aviation
5Administration, (ii) have a Class IV Rating, and (iii) conduct
6operations in accordance with Part 145 of the Federal Aviation
7Regulations. The exemption does not include aircraft operated
8by a commercial air carrier providing scheduled passenger air
9service pursuant to authority issued under Part 121 or Part 129
10of the Federal Aviation Regulations. The changes made to this
11paragraph (35) by Public Act 98-534 are declarative of existing
12law.
13    (36) Tangible personal property purchased by a
14public-facilities corporation, as described in Section
1511-65-10 of the Illinois Municipal Code, for purposes of
16constructing or furnishing a municipal convention hall, but
17only if the legal title to the municipal convention hall is
18transferred to the municipality without any further
19consideration by or on behalf of the municipality at the time
20of the completion of the municipal convention hall or upon the
21retirement or redemption of any bonds or other debt instruments
22issued by the public-facilities corporation in connection with
23the development of the municipal convention hall. This
24exemption includes existing public-facilities corporations as
25provided in Section 11-65-25 of the Illinois Municipal Code.
26This paragraph is exempt from the provisions of Section 3-90.

 

 

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1    (37) Tangible personal property produced by a manufacturer
2and provided free of charge to consumers as a sample of the
3manufacturer's product for the purpose of encouraging
4consumers to purchase the same or similar items produced by the
5manufacturer. This paragraph is exempt from the provisions of
6Section 3-90.
7(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
898-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-574, eff.
91-1-14; 98-583, eff. 1-1-14; 98-756, eff. 7-16-14; 99-180, eff.
107-29-15.)
 
11    Section 10. The Service Use Tax Act is amended by changing
12Section 3-5 as follows:
 
13    (35 ILCS 110/3-5)
14    Sec. 3-5. Exemptions. Use of the following tangible
15personal property is exempt from the tax imposed by this Act:
16    (1) Personal property purchased from a corporation,
17society, association, foundation, institution, or
18organization, other than a limited liability company, that is
19organized and operated as a not-for-profit service enterprise
20for the benefit of persons 65 years of age or older if the
21personal property was not purchased by the enterprise for the
22purpose of resale by the enterprise.
23    (2) Personal property purchased by a non-profit Illinois
24county fair association for use in conducting, operating, or

 

 

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1promoting the county fair.
2    (3) Personal property purchased by a not-for-profit arts or
3cultural organization that establishes, by proof required by
4the Department by rule, that it has received an exemption under
5Section 501(c)(3) of the Internal Revenue Code and that is
6organized and operated primarily for the presentation or
7support of arts or cultural programming, activities, or
8services. These organizations include, but are not limited to,
9music and dramatic arts organizations such as symphony
10orchestras and theatrical groups, arts and cultural service
11organizations, local arts councils, visual arts organizations,
12and media arts organizations. On and after the effective date
13of this amendatory Act of the 92nd General Assembly, however,
14an entity otherwise eligible for this exemption shall not make
15tax-free purchases unless it has an active identification
16number issued by the Department.
17    (4) Legal tender, currency, medallions, or gold or silver
18coinage issued by the State of Illinois, the government of the
19United States of America, or the government of any foreign
20country, and bullion.
21    (5) Until July 1, 2003 and beginning again on September 1,
222004 through August 30, 2014, graphic arts machinery and
23equipment, including repair and replacement parts, both new and
24used, and including that manufactured on special order or
25purchased for lease, certified by the purchaser to be used
26primarily for graphic arts production. Equipment includes

 

 

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1chemicals or chemicals acting as catalysts but only if the
2chemicals or chemicals acting as catalysts effect a direct and
3immediate change upon a graphic arts product.
4    (6) Personal property purchased from a teacher-sponsored
5student organization affiliated with an elementary or
6secondary school located in Illinois.
7    (7) Farm machinery and equipment, both new and used,
8including that manufactured on special order, certified by the
9purchaser to be used primarily for production agriculture or
10State or federal agricultural programs, including individual
11replacement parts for the machinery and equipment, including
12machinery and equipment purchased for lease, and including
13implements of husbandry defined in Section 1-130 of the
14Illinois Vehicle Code, farm machinery and agricultural
15chemical and fertilizer spreaders, and nurse wagons required to
16be registered under Section 3-809 of the Illinois Vehicle Code,
17but excluding other motor vehicles required to be registered
18under the Illinois Vehicle Code. Horticultural polyhouses or
19hoop houses used for propagating, growing, or overwintering
20plants shall be considered farm machinery and equipment under
21this item (7). Agricultural chemical tender tanks and dry boxes
22shall include units sold separately from a motor vehicle
23required to be licensed and units sold mounted on a motor
24vehicle required to be licensed if the selling price of the
25tender is separately stated.
26    Farm machinery and equipment shall include precision

 

 

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1farming equipment that is installed or purchased to be
2installed on farm machinery and equipment including, but not
3limited to, tractors, harvesters, sprayers, planters, seeders,
4or spreaders. Precision farming equipment includes, but is not
5limited to, soil testing sensors, computers, monitors,
6software, global positioning and mapping systems, and other
7such equipment.
8    Farm machinery and equipment also includes computers,
9sensors, software, and related equipment used primarily in the
10computer-assisted operation of production agriculture
11facilities, equipment, and activities such as, but not limited
12to, the collection, monitoring, and correlation of animal and
13crop data for the purpose of formulating animal diets and
14agricultural chemicals. This item (7) is exempt from the
15provisions of Section 3-75.
16    (8) Until June 30, 2013, fuel and petroleum products sold
17to or used by an air common carrier, certified by the carrier
18to be used for consumption, shipment, or storage in the conduct
19of its business as an air common carrier, for a flight destined
20for or returning from a location or locations outside the
21United States without regard to previous or subsequent domestic
22stopovers.
23    Beginning July 1, 2013, fuel and petroleum products sold to
24or used by an air carrier, certified by the carrier to be used
25for consumption, shipment, or storage in the conduct of its
26business as an air common carrier, for a flight that (i) is

 

 

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

 

 

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1and used, including that manufactured on special order,
2certified by the purchaser to be used primarily for
3photoprocessing, and including photoprocessing machinery and
4equipment purchased for lease.
5    (12) Coal and aggregate exploration, mining, off-highway
6hauling, processing, maintenance, and reclamation equipment,
7including replacement parts and equipment, and including
8equipment purchased for lease, but excluding motor vehicles
9required to be registered under the Illinois Vehicle Code. The
10changes made to this Section by Public Act 97-767 apply on and
11after July 1, 2003, but no claim for credit or refund is
12allowed on or after August 16, 2013 (the effective date of
13Public Act 98-456) for such taxes paid during the period
14beginning July 1, 2003 and ending on August 16, 2013 (the
15effective date of Public Act 98-456).
16    (13) Semen used for artificial insemination of livestock
17for direct agricultural production.
18    (14) 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 (14) is exempt from the provisions
24of Section 3-75, and the exemption provided for under this item
25(14) applies for all periods beginning May 30, 1995, but no
26claim for credit or refund is allowed on or after the effective

 

 

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1date of this amendatory Act of the 95th General Assembly for
2such taxes paid during the period beginning May 30, 2000 and
3ending on the effective date of this amendatory Act of the 95th
4General Assembly.
5    (15) Computers and communications equipment utilized for
6any hospital purpose and equipment used in the diagnosis,
7analysis, or treatment of hospital patients purchased by a
8lessor who leases the equipment, under a lease of one year or
9longer executed or in effect at the time the lessor would
10otherwise be subject to the tax imposed by this Act, to a
11hospital that has been issued an active tax exemption
12identification number by the Department under Section 1g of the
13Retailers' Occupation Tax Act. If the equipment is leased in a
14manner that does not qualify for this exemption or is used in
15any other non-exempt manner, the lessor shall be liable for the
16tax imposed under this Act or the Use Tax Act, as the case may
17be, based on the fair market value of the property at the time
18the non-qualifying use occurs. No lessor shall collect or
19attempt to collect an amount (however designated) that purports
20to reimburse that lessor for the tax imposed by this Act or the
21Use Tax Act, as the case may be, if the tax has not been paid by
22the lessor. If a lessor improperly collects any such amount
23from the lessee, the lessee shall have a legal right to claim a
24refund of that amount from the lessor. If, however, that amount
25is not refunded to the lessee for any reason, the lessor is
26liable to pay that amount to the Department.

 

 

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

 

 

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1corporation, society, association, foundation, or institution
2that has been issued a sales tax exemption identification
3number by the Department that assists victims of the disaster
4who reside within the declared disaster area.
5    (18) Beginning with taxable years ending on or after
6December 31, 1995 and ending with taxable years ending on or
7before December 31, 2004, personal property that is used in the
8performance of infrastructure repairs in this State, including
9but not limited to municipal roads and streets, access roads,
10bridges, sidewalks, waste disposal systems, water and sewer
11line extensions, water distribution and purification
12facilities, storm water drainage and retention facilities, and
13sewage treatment facilities, resulting from a State or
14federally declared disaster in Illinois or bordering Illinois
15when such repairs are initiated on facilities located in the
16declared disaster area within 6 months after the disaster.
17    (19) Beginning July 1, 1999, game or game birds purchased
18at a "game breeding and hunting preserve area" as that term is
19used in the Wildlife Code. This paragraph is exempt from the
20provisions of Section 3-75.
21    (20) A motor vehicle, as that term is defined in Section
221-146 of the Illinois Vehicle Code, that is donated to a
23corporation, limited liability company, society, association,
24foundation, or institution that is determined by the Department
25to be organized and operated exclusively for educational
26purposes. For purposes of this exemption, "a corporation,

 

 

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1limited liability company, society, association, foundation,
2or institution organized and operated exclusively for
3educational purposes" means all tax-supported public schools,
4private schools that offer systematic instruction in useful
5branches of learning by methods common to public schools and
6that compare favorably in their scope and intensity with the
7course of study presented in tax-supported schools, and
8vocational or technical schools or institutes organized and
9operated exclusively to provide a course of study of not less
10than 6 weeks duration and designed to prepare individuals to
11follow a trade or to pursue a manual, technical, mechanical,
12industrial, business, or commercial occupation.
13    (21) Beginning January 1, 2000, personal property,
14including food, purchased through fundraising events for the
15benefit of a public or private elementary or secondary school,
16a group of those schools, or one or more school districts if
17the events are sponsored by an entity recognized by the school
18district that consists primarily of volunteers and includes
19parents and teachers of the school children. This paragraph
20does not apply to fundraising events (i) for the benefit of
21private home instruction or (ii) for which the fundraising
22entity purchases the personal property sold at the events from
23another individual or entity that sold the property for the
24purpose of resale by the fundraising entity and that profits
25from the sale to the fundraising entity. This paragraph is
26exempt from the provisions of Section 3-75.

 

 

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1    (22) Beginning January 1, 2000 and through December 31,
22001, new or used automatic vending machines that prepare and
3serve hot food and beverages, including coffee, soup, and other
4items, and replacement parts for these machines. Beginning
5January 1, 2002 and through June 30, 2003, machines and parts
6for machines used in commercial, coin-operated amusement and
7vending business if a use or occupation tax is paid on the
8gross receipts derived from the use of the commercial,
9coin-operated amusement and vending machines. This paragraph
10is exempt from the provisions of Section 3-75.
11    (23) Beginning August 23, 2001 and through June 30, 2016,
12food for human consumption that is to be consumed off the
13premises where it is sold (other than alcoholic beverages, soft
14drinks, and food that has been prepared for immediate
15consumption) and prescription and nonprescription medicines,
16drugs, medical appliances, and insulin, urine testing
17materials, syringes, and needles used by diabetics, for human
18use, when purchased for use by a person receiving medical
19assistance under Article V of the Illinois Public Aid Code who
20resides in a licensed long-term care facility, as defined in
21the Nursing Home Care Act, or in a licensed facility as defined
22in the ID/DD Community Care Act, the MC/DD Act, or the
23Specialized Mental Health Rehabilitation Act of 2013.
24    (24) Beginning on the effective date of this amendatory Act
25of the 92nd General Assembly, computers and communications
26equipment utilized for any hospital purpose and equipment used

 

 

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

 

 

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1governmental body that has been issued an active tax exemption
2identification number by the Department under Section 1g of the
3Retailers' Occupation Tax Act. If the property is leased in a
4manner that does not qualify for this exemption or is used in
5any other nonexempt manner, the lessor shall be liable for the
6tax imposed under this Act or the Use Tax Act, as the case may
7be, based on the fair market value of the property at the time
8the nonqualifying use occurs. No lessor shall collect or
9attempt to collect an amount (however designated) that purports
10to reimburse that lessor for the tax imposed by this Act or the
11Use Tax Act, as the case may be, if the tax has not been paid by
12the lessor. If a lessor improperly collects any such amount
13from the lessee, the lessee shall have a legal right to claim a
14refund of that amount from the lessor. If, however, that amount
15is not refunded to the lessee for any reason, the lessor is
16liable to pay that amount to the Department. This paragraph is
17exempt from the provisions of Section 3-75.
18    (26) Beginning January 1, 2008, tangible personal property
19used in the construction or maintenance of a community water
20supply, as defined under Section 3.145 of the Environmental
21Protection Act, that is operated by a not-for-profit
22corporation that holds a valid water supply permit issued under
23Title IV of the Environmental Protection Act. This paragraph is
24exempt from the provisions of Section 3-75.
25    (27) Beginning January 1, 2010, materials, parts,
26equipment, components, and furnishings incorporated into or

 

 

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1upon an aircraft as part of the modification, refurbishment,
2completion, replacement, repair, or maintenance of the
3aircraft. This exemption includes consumable supplies used in
4the modification, refurbishment, completion, replacement,
5repair, and maintenance of aircraft, but excludes any
6materials, parts, equipment, components, and consumable
7supplies used in the modification, replacement, repair, and
8maintenance of aircraft engines or power plants, whether such
9engines or power plants are installed or uninstalled upon any
10such aircraft. "Consumable supplies" include, but are not
11limited to, adhesive, tape, sandpaper, general purpose
12lubricants, cleaning solution, latex gloves, and protective
13films. This exemption applies only to the use of qualifying
14tangible personal property transferred incident to the
15modification, refurbishment, completion, replacement, repair,
16or maintenance of aircraft by persons who (i) hold an Air
17Agency Certificate and are empowered to operate an approved
18repair station by the Federal Aviation Administration, (ii)
19have a Class IV Rating, and (iii) conduct operations in
20accordance with Part 145 of the Federal Aviation Regulations.
21The exemption does not include aircraft operated by a
22commercial air carrier providing scheduled passenger air
23service pursuant to authority issued under Part 121 or Part 129
24of the Federal Aviation Regulations. The changes made to this
25paragraph (27) by Public Act 98-534 are declarative of existing
26law.

 

 

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1    (28) Tangible personal property purchased by a
2public-facilities corporation, as described in Section
311-65-10 of the Illinois Municipal Code, for purposes of
4constructing or furnishing a municipal convention hall, but
5only if the legal title to the municipal convention hall is
6transferred to the municipality without any further
7consideration by or on behalf of the municipality at the time
8of the completion of the municipal convention hall or upon the
9retirement or redemption of any bonds or other debt instruments
10issued by the public-facilities corporation in connection with
11the development of the municipal convention hall. This
12exemption includes existing public-facilities corporations as
13provided in Section 11-65-25 of the Illinois Municipal Code.
14This paragraph is exempt from the provisions of Section 3-75.
15    (29) Tangible personal property produced by a manufacturer
16and provided free of charge to consumers as a sample of the
17manufacturer's product for the purpose of encouraging
18consumers to purchase the same or similar items produced by the
19manufacturer. This paragraph is exempt from the provisions of
20Section 3-75.
21(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
2298-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-756, eff.
237-16-14; 99-180, eff. 7-29-15.)
 
24    Section 15. The Service Occupation Tax Act is amended by
25changing Section 3-5 as follows:
 

 

 

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1    (35 ILCS 115/3-5)
2    Sec. 3-5. Exemptions. The following tangible personal
3property is exempt from the tax imposed by this Act:
4    (1) Personal property sold by a corporation, society,
5association, foundation, institution, or organization, other
6than a limited liability company, that is organized and
7operated as a not-for-profit service enterprise for the benefit
8of persons 65 years of age or older if the personal property
9was not purchased by the enterprise for the purpose of resale
10by the enterprise.
11    (2) Personal property purchased by a not-for-profit
12Illinois county fair association for use in conducting,
13operating, or promoting the county fair.
14    (3) Personal property purchased by any not-for-profit arts
15or cultural organization that establishes, by proof required by
16the Department by rule, that it has received an exemption under
17Section 501(c)(3) of the Internal Revenue Code and that is
18organized and operated primarily for the presentation or
19support of arts or cultural programming, activities, or
20services. These organizations include, but are not limited to,
21music and dramatic arts organizations such as symphony
22orchestras and theatrical groups, arts and cultural service
23organizations, local arts councils, visual arts organizations,
24and media arts organizations. On and after the effective date
25of this amendatory Act of the 92nd General Assembly, however,

 

 

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1an entity otherwise eligible for this exemption shall not make
2tax-free purchases unless it has an active identification
3number issued by the Department.
4    (4) Legal tender, currency, medallions, or gold or silver
5coinage issued by the State of Illinois, the government of the
6United States of America, or the government of any foreign
7country, and bullion.
8    (5) Until July 1, 2003 and beginning again on September 1,
92004 through August 30, 2014, graphic arts machinery and
10equipment, including repair and replacement parts, both new and
11used, and including that manufactured on special order or
12purchased for lease, certified by the purchaser to be used
13primarily for graphic arts production. Equipment includes
14chemicals or chemicals acting as catalysts but only if the
15chemicals or chemicals acting as catalysts effect a direct and
16immediate change upon a graphic arts product.
17    (6) Personal property sold by a teacher-sponsored student
18organization affiliated with an elementary or secondary school
19located in Illinois.
20    (7) Farm machinery and equipment, both new and used,
21including that manufactured on special order, certified by the
22purchaser to be used primarily for production agriculture or
23State or federal agricultural programs, including individual
24replacement parts for the machinery and equipment, including
25machinery and equipment purchased for lease, and including
26implements of husbandry defined in Section 1-130 of the

 

 

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

 

 

SB2413- 36 -LRB099 18147 HLH 42514 b

1agricultural chemicals. This item (7) is exempt from the
2provisions of Section 3-55.
3    (8) Until June 30, 2013, fuel and petroleum products sold
4to or used by an air common carrier, certified by the carrier
5to be used for consumption, shipment, or storage in the conduct
6of its business as an air common carrier, for a flight destined
7for or returning from a location or locations outside the
8United States without regard to previous or subsequent domestic
9stopovers.
10    Beginning July 1, 2013, fuel and petroleum products sold to
11or used by an air carrier, certified by the carrier to be used
12for consumption, shipment, or storage in the conduct of its
13business as an air common carrier, for a flight that (i) is
14engaged in foreign trade or is engaged in trade between the
15United States and any of its possessions and (ii) transports at
16least one individual or package for hire from the city of
17origination to the city of final destination on the same
18aircraft, without regard to a change in the flight number of
19that aircraft.
20    (9) Proceeds of mandatory service charges separately
21stated on customers' bills for the purchase and consumption of
22food and beverages, to the extent that the proceeds of the
23service 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

 

 

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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) Photoprocessing machinery and equipment, including
12repair and replacement parts, both new and used, including that
13manufactured on special order, certified by the purchaser to be
14used primarily for photoprocessing, and including
15photoprocessing machinery and equipment purchased for lease.
16    (12) Coal and aggregate exploration, mining, off-highway
17hauling, processing, maintenance, and reclamation equipment,
18including replacement parts and equipment, and including
19equipment purchased for lease, but excluding motor vehicles
20required to be registered under the Illinois Vehicle Code. The
21changes made to this Section by Public Act 97-767 apply on and
22after July 1, 2003, but no claim for credit or refund is
23allowed on or after August 16, 2013 (the effective date of
24Public Act 98-456) for such taxes paid during the period
25beginning July 1, 2003 and ending on August 16, 2013 (the
26effective date of Public Act 98-456).

 

 

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1    (13) Beginning January 1, 1992 and through June 30, 2016,
2food for human consumption that is to be consumed off the
3premises where it is sold (other than alcoholic beverages, soft
4drinks and food that has been prepared for immediate
5consumption) and prescription and non-prescription medicines,
6drugs, medical appliances, and insulin, urine testing
7materials, syringes, and needles used by diabetics, for human
8use, when purchased for use by a person receiving medical
9assistance under Article V of the Illinois Public Aid Code who
10resides in a licensed long-term care facility, as defined in
11the Nursing Home Care Act, or in a licensed facility as defined
12in the ID/DD Community Care Act, the MC/DD Act, or the
13Specialized Mental Health Rehabilitation Act of 2013.
14    (14) Semen used for artificial insemination of livestock
15for direct agricultural production.
16    (15) Horses, or interests in horses, registered with and
17meeting the requirements of any of the Arabian Horse Club
18Registry of America, Appaloosa Horse Club, American Quarter
19Horse Association, United States Trotting Association, or
20Jockey Club, as appropriate, used for purposes of breeding or
21racing for prizes. This item (15) is exempt from the provisions
22of Section 3-55, and the exemption provided for under this item
23(15) applies for all periods beginning May 30, 1995, but no
24claim for credit or refund is allowed on or after January 1,
252008 (the effective date of Public Act 95-88) for such taxes
26paid during the period beginning May 30, 2000 and ending on

 

 

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1January 1, 2008 (the effective date of Public Act 95-88).
2    (16) Computers and communications equipment utilized for
3any hospital purpose and equipment used in the diagnosis,
4analysis, or treatment of hospital patients sold to a lessor
5who leases the equipment, under a lease of one year or longer
6executed or in effect at the time of the purchase, to a
7hospital that has been issued an active tax exemption
8identification number by the Department under Section 1g of the
9Retailers' Occupation Tax Act.
10    (17) Personal property sold to a lessor who leases the
11property, under a lease of one year or longer executed or in
12effect at the time of the purchase, to a governmental body that
13has been issued an active tax exemption identification number
14by the Department under Section 1g of the Retailers' Occupation
15Tax Act.
16    (18) Beginning with taxable years ending on or after
17December 31, 1995 and ending with taxable years ending on or
18before December 31, 2004, personal property that is donated for
19disaster relief to be used in a State or federally declared
20disaster area in Illinois or bordering Illinois by a
21manufacturer or retailer that is registered in this State to a
22corporation, society, association, foundation, or institution
23that has been issued a sales tax exemption identification
24number by the Department that assists victims of the disaster
25who reside within the declared disaster area.
26    (19) Beginning with taxable years ending on or after

 

 

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1December 31, 1995 and ending with taxable years ending on or
2before December 31, 2004, personal property that is used in the
3performance of infrastructure repairs in this State, including
4but not limited to municipal roads and streets, access roads,
5bridges, sidewalks, waste disposal systems, water and sewer
6line extensions, water distribution and purification
7facilities, storm water drainage and retention facilities, and
8sewage treatment facilities, resulting from a State or
9federally declared disaster in Illinois or bordering Illinois
10when such repairs are initiated on facilities located in the
11declared disaster area within 6 months after the disaster.
12    (20) Beginning July 1, 1999, game or game birds sold at a
13"game breeding and hunting preserve area" as that term is used
14in the Wildlife Code. This paragraph is exempt from the
15provisions of Section 3-55.
16    (21) A motor vehicle, as that term is defined in Section
171-146 of the Illinois Vehicle Code, that is donated to a
18corporation, limited liability company, society, association,
19foundation, or institution that is determined by the Department
20to be organized and operated exclusively for educational
21purposes. For purposes of this exemption, "a corporation,
22limited liability company, society, association, foundation,
23or institution organized and operated exclusively for
24educational purposes" means all tax-supported public schools,
25private schools that offer systematic instruction in useful
26branches of learning by methods common to public schools and

 

 

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1that compare favorably in their scope and intensity with the
2course of study presented in tax-supported schools, and
3vocational or technical schools or institutes organized and
4operated exclusively to provide a course of study of not less
5than 6 weeks duration and designed to prepare individuals to
6follow a trade or to pursue a manual, technical, mechanical,
7industrial, business, or commercial occupation.
8    (22) Beginning January 1, 2000, personal property,
9including food, purchased through fundraising events for the
10benefit of a public or private elementary or secondary school,
11a group of those schools, or one or more school districts if
12the events are sponsored by an entity recognized by the school
13district that consists primarily of volunteers and includes
14parents and teachers of the school children. This paragraph
15does not apply to fundraising events (i) for the benefit of
16private home instruction or (ii) for which the fundraising
17entity purchases the personal property sold at the events from
18another individual or entity that sold the property for the
19purpose of resale by the fundraising entity and that profits
20from the sale to the fundraising entity. This paragraph is
21exempt from the provisions of Section 3-55.
22    (23) Beginning January 1, 2000 and through December 31,
232001, new or used automatic vending machines that prepare and
24serve hot food and beverages, including coffee, soup, and other
25items, and replacement parts for these machines. Beginning
26January 1, 2002 and through June 30, 2003, machines and parts

 

 

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1for machines used in commercial, coin-operated amusement and
2vending business if a use or occupation tax is paid on the
3gross receipts derived from the use of the commercial,
4coin-operated amusement and vending machines. This paragraph
5is exempt from the provisions of Section 3-55.
6    (24) Beginning on the effective date of this amendatory Act
7of the 92nd General Assembly, computers and communications
8equipment utilized for any hospital purpose and equipment used
9in the diagnosis, analysis, or treatment of hospital patients
10sold to a lessor who leases the equipment, under a lease of one
11year or longer executed or in effect at the time of the
12purchase, to a hospital that has been issued an active tax
13exemption identification number by the Department under
14Section 1g of the Retailers' Occupation Tax Act. This paragraph
15is exempt from the provisions of Section 3-55.
16    (25) Beginning on the effective date of this amendatory Act
17of the 92nd General Assembly, personal property sold to a
18lessor who leases the property, under a lease of one year or
19longer executed or in effect at the time of the purchase, to a
20governmental body that has been issued an active tax exemption
21identification number by the Department under Section 1g of the
22Retailers' Occupation Tax Act. This paragraph is exempt from
23the provisions of Section 3-55.
24    (26) Beginning on January 1, 2002 and through June 30,
252016, tangible personal property purchased from an Illinois
26retailer by a taxpayer engaged in centralized purchasing

 

 

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1activities in Illinois who will, upon receipt of the property
2in Illinois, temporarily store the property in Illinois (i) for
3the purpose of subsequently transporting it outside this State
4for use or consumption thereafter solely outside this State or
5(ii) for the purpose of being processed, fabricated, or
6manufactured into, attached to, or incorporated into other
7tangible personal property to be transported outside this State
8and thereafter used or consumed solely outside this State. The
9Director of Revenue shall, pursuant to rules adopted in
10accordance with the Illinois Administrative Procedure Act,
11issue a permit to any taxpayer in good standing with the
12Department who is eligible for the exemption under this
13paragraph (26). The permit issued under this paragraph (26)
14shall authorize the holder, to the extent and in the manner
15specified in the rules adopted under this Act, to purchase
16tangible personal property from a retailer exempt from the
17taxes imposed by this Act. Taxpayers shall maintain all
18necessary books and records to substantiate the use and
19consumption of all such tangible personal property outside of
20the State of Illinois.
21    (27) Beginning January 1, 2008, tangible personal property
22used in the construction or maintenance of a community water
23supply, as defined under Section 3.145 of the Environmental
24Protection Act, that is operated by a not-for-profit
25corporation that holds a valid water supply permit issued under
26Title IV of the Environmental Protection Act. This paragraph is

 

 

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1exempt from the provisions of Section 3-55.
2    (28) Tangible personal property sold to a
3public-facilities corporation, as described in Section
411-65-10 of the Illinois Municipal Code, for purposes of
5constructing or furnishing a municipal convention hall, but
6only if the legal title to the municipal convention hall is
7transferred to the municipality without any further
8consideration by or on behalf of the municipality at the time
9of the completion of the municipal convention hall or upon the
10retirement or redemption of any bonds or other debt instruments
11issued by the public-facilities corporation in connection with
12the development of the municipal convention hall. This
13exemption includes existing public-facilities corporations as
14provided in Section 11-65-25 of the Illinois Municipal Code.
15This paragraph is exempt from the provisions of Section 3-55.
16    (29) Beginning January 1, 2010, materials, parts,
17equipment, components, and furnishings incorporated into or
18upon an aircraft as part of the modification, refurbishment,
19completion, replacement, repair, or maintenance of the
20aircraft. This exemption includes consumable supplies used in
21the modification, refurbishment, completion, replacement,
22repair, and maintenance of aircraft, but excludes any
23materials, parts, equipment, components, and consumable
24supplies used in the modification, replacement, repair, and
25maintenance of aircraft engines or power plants, whether such
26engines or power plants are installed or uninstalled upon any

 

 

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1such aircraft. "Consumable supplies" include, but are not
2limited to, adhesive, tape, sandpaper, general purpose
3lubricants, cleaning solution, latex gloves, and protective
4films. This exemption applies only to the transfer of
5qualifying tangible personal property incident to the
6modification, refurbishment, completion, replacement, repair,
7or maintenance of an aircraft by persons who (i) hold an Air
8Agency Certificate and are empowered to operate an approved
9repair station by the Federal Aviation Administration, (ii)
10have a Class IV Rating, and (iii) conduct operations in
11accordance with Part 145 of the Federal Aviation Regulations.
12The exemption does not include aircraft operated by a
13commercial air carrier providing scheduled passenger air
14service pursuant to authority issued under Part 121 or Part 129
15of the Federal Aviation Regulations. The changes made to this
16paragraph (29) by Public Act 98-534 are declarative of existing
17law.
18    (30) Tangible personal property produced by a manufacturer
19and provided free of charge to consumers as a sample of the
20manufacturer's product for the purpose of encouraging
21consumers to purchase the same or similar items produced by the
22manufacturer. This paragraph is exempt from the provisions of
23Section 3-55.
24(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
2598-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-756, eff.
267-16-14; 99-180, eff. 7-29-15.)
 

 

 

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1    Section 20. The Retailers' Occupation Tax Act is amended by
2changing Section 2-5 as follows:
 
3    (35 ILCS 120/2-5)
4    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
5sale of the following tangible personal property are exempt
6from the tax imposed by this Act:
7    (1) Farm chemicals.
8    (2) Farm machinery and equipment, both new and used,
9including that manufactured on special order, certified by the
10purchaser to be used primarily for production agriculture or
11State or federal agricultural programs, including individual
12replacement parts for the machinery and equipment, including
13machinery and equipment purchased for lease, and including
14implements of husbandry defined in Section 1-130 of the
15Illinois Vehicle Code, farm machinery and agricultural
16chemical and fertilizer spreaders, and nurse wagons required to
17be registered under Section 3-809 of the Illinois Vehicle Code,
18but excluding other motor vehicles required to be registered
19under the Illinois Vehicle Code. Horticultural polyhouses or
20hoop houses used for propagating, growing, or overwintering
21plants shall be considered farm machinery and equipment under
22this item (2). Agricultural chemical tender tanks and dry boxes
23shall include units sold separately from a motor vehicle
24required to be licensed and units sold mounted on a motor

 

 

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1vehicle required to be licensed, if the selling price of the
2tender is separately stated.
3    Farm machinery and equipment shall include precision
4farming equipment that is installed or purchased to be
5installed on farm machinery and equipment including, but not
6limited to, tractors, harvesters, sprayers, planters, seeders,
7or spreaders. Precision farming equipment includes, but is not
8limited to, soil testing sensors, computers, monitors,
9software, global positioning and mapping systems, and other
10such equipment.
11    Farm machinery and equipment also includes computers,
12sensors, software, and related equipment used primarily in the
13computer-assisted operation of production agriculture
14facilities, equipment, and activities such as, but not limited
15to, the collection, monitoring, and correlation of animal and
16crop data for the purpose of formulating animal diets and
17agricultural chemicals. This item (2) is exempt from the
18provisions of Section 2-70.
19    (3) Until July 1, 2003, distillation machinery and
20equipment, sold as a unit or kit, assembled or installed by the
21retailer, certified by the user to be used only for the
22production of ethyl alcohol that will be used for consumption
23as motor fuel or as a component of motor fuel for the personal
24use of the user, and not subject to sale or resale.
25    (4) Until July 1, 2003 and beginning again September 1,
262004 through August 30, 2014, graphic arts machinery and

 

 

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1equipment, including repair and replacement parts, both new and
2used, and including that manufactured on special order or
3purchased for lease, certified by the purchaser to be used
4primarily for graphic arts production. Equipment includes
5chemicals or chemicals acting as catalysts but only if the
6chemicals or chemicals acting as catalysts effect a direct and
7immediate change upon a graphic arts product.
8    (5) A motor vehicle that is used for automobile renting, as
9defined in the Automobile Renting Occupation and Use Tax Act.
10This paragraph is exempt from the provisions of Section 2-70.
11    (6) Personal property sold by a teacher-sponsored student
12organization affiliated with an elementary or secondary school
13located in Illinois.
14    (7) Until July 1, 2003, proceeds of that portion of the
15selling price of a passenger car the sale of which is subject
16to the Replacement Vehicle Tax.
17    (8) Personal property sold to an Illinois county fair
18association for use in conducting, operating, or promoting the
19county fair.
20    (9) Personal property sold to a not-for-profit arts or
21cultural organization that establishes, by proof required by
22the Department by rule, that it has received an exemption under
23Section 501(c)(3) of the Internal Revenue Code and that is
24organized and operated primarily for the presentation or
25support of arts or cultural programming, activities, or
26services. These organizations include, but are not limited to,

 

 

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1music and dramatic arts organizations such as symphony
2orchestras and theatrical groups, arts and cultural service
3organizations, local arts councils, visual arts organizations,
4and media arts organizations. On and after the effective date
5of this amendatory Act of the 92nd General Assembly, however,
6an entity otherwise eligible for this exemption shall not make
7tax-free purchases unless it has an active identification
8number issued by the Department.
9    (10) Personal property sold by a corporation, society,
10association, foundation, institution, or organization, other
11than a limited liability company, that is organized and
12operated as a not-for-profit service enterprise for the benefit
13of persons 65 years of age or older if the personal property
14was not purchased by the enterprise for the purpose of resale
15by the enterprise.
16    (11) Personal property sold to a governmental body, to a
17corporation, society, association, foundation, or institution
18organized and operated exclusively for charitable, religious,
19or educational purposes, or to a not-for-profit corporation,
20society, association, foundation, institution, or organization
21that has no compensated officers or employees and that is
22organized and operated primarily for the recreation of persons
2355 years of age or older. A limited liability company may
24qualify for the exemption under this paragraph only if the
25limited liability company is organized and operated
26exclusively for educational purposes. On and after July 1,

 

 

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11987, however, no entity otherwise eligible for this exemption
2shall make tax-free purchases unless it has an active
3identification number issued by the Department.
4    (12) Tangible personal property sold to interstate
5carriers for hire for use as rolling stock moving in interstate
6commerce or to lessors under leases of one year or longer
7executed or in effect at the time of purchase by interstate
8carriers for hire for use as rolling stock moving in interstate
9commerce and equipment operated by a telecommunications
10provider, licensed as a common carrier by the Federal
11Communications Commission, which is permanently installed in
12or affixed to aircraft moving in interstate commerce.
13    (12-5) On and after July 1, 2003 and through June 30, 2004,
14motor vehicles of the second division with a gross vehicle
15weight in excess of 8,000 pounds that are subject to the
16commercial distribution fee imposed under Section 3-815.1 of
17the Illinois Vehicle Code. Beginning on July 1, 2004 and
18through June 30, 2005, the use in this State of motor vehicles
19of the second division: (i) with a gross vehicle weight rating
20in excess of 8,000 pounds; (ii) that are subject to the
21commercial distribution fee imposed under Section 3-815.1 of
22the Illinois Vehicle Code; and (iii) that are primarily used
23for commercial purposes. Through June 30, 2005, this exemption
24applies to repair and replacement parts added after the initial
25purchase of such a motor vehicle if that motor vehicle is used
26in a manner that would qualify for the rolling stock exemption

 

 

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1otherwise provided for in this Act. For purposes of this
2paragraph, "used for commercial purposes" means the
3transportation of persons or property in furtherance of any
4commercial or industrial enterprise whether for-hire or not.
5    (13) Proceeds from sales to owners, lessors, or shippers of
6tangible personal property that is utilized by interstate
7carriers for hire for use as rolling stock moving in interstate
8commerce and equipment operated by a telecommunications
9provider, licensed as a common carrier by the Federal
10Communications Commission, which is permanently installed in
11or affixed to aircraft moving in interstate commerce.
12    (14) Machinery and equipment that will be used by the
13purchaser, or a lessee of the purchaser, primarily in the
14process of manufacturing or assembling tangible personal
15property for wholesale or retail sale or lease, whether the
16sale or lease is made directly by the manufacturer or by some
17other person, whether the materials used in the process are
18owned by the manufacturer or some other person, or whether the
19sale or lease is made apart from or as an incident to the
20seller's engaging in the service occupation of producing
21machines, tools, dies, jigs, patterns, gauges, or other similar
22items of no commercial value on special order for a particular
23purchaser. The exemption provided by this paragraph (14) does
24not include machinery and equipment used in (i) the generation
25of electricity for wholesale or retail sale; (ii) the
26generation or treatment of natural or artificial gas for

 

 

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1wholesale or retail sale that is delivered to customers through
2pipes, pipelines, or mains; or (iii) the treatment of water for
3wholesale or retail sale that is delivered to customers through
4pipes, pipelines, or mains. The provisions of Public Act 98-583
5are declaratory of existing law as to the meaning and scope of
6this exemption.
7    (15) Proceeds of mandatory service charges separately
8stated on customers' bills for purchase and consumption of food
9and beverages, to the extent that the proceeds of the service
10charge are in fact turned over as tips or as a substitute for
11tips to the employees who participate directly in preparing,
12serving, hosting or cleaning up the food or beverage function
13with respect to which the service charge is imposed.
14    (16) Petroleum products sold to a purchaser if the seller
15is prohibited by federal law from charging tax to the
16purchaser.
17    (17) Tangible personal property sold to a common carrier by
18rail or motor that receives the physical possession of the
19property in Illinois and that transports the property, or
20shares with another common carrier in the transportation of the
21property, out of Illinois on a standard uniform bill of lading
22showing the seller of the property as the shipper or consignor
23of the property to a destination outside Illinois, for use
24outside Illinois.
25    (18) Legal tender, currency, medallions, or gold or silver
26coinage issued by the State of Illinois, the government of the

 

 

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1United States of America, or the government of any foreign
2country, and bullion.
3    (19) Until July 1 2003, oil field exploration, drilling,
4and production equipment, including (i) rigs and parts of rigs,
5rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
6tubular goods, including casing and drill strings, (iii) pumps
7and pump-jack units, (iv) storage tanks and flow lines, (v) any
8individual replacement part for oil field exploration,
9drilling, and production equipment, and (vi) machinery and
10equipment purchased for lease; but excluding motor vehicles
11required to be registered under the Illinois Vehicle Code.
12    (20) Photoprocessing machinery and equipment, including
13repair and replacement parts, both new and used, including that
14manufactured on special order, certified by the purchaser to be
15used primarily for photoprocessing, and including
16photoprocessing machinery and equipment purchased for lease.
17    (21) 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

 

 

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1effective date of Public Act 98-456).
2    (22) Until June 30, 2013, fuel and petroleum products sold
3to or used by an air carrier, certified by the carrier to be
4used for consumption, shipment, or storage in the conduct of
5its 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    (23) A transaction in which the purchase order is received
20by a florist who is located outside Illinois, but who has a
21florist located in Illinois deliver the property to the
22purchaser or the purchaser's donee in Illinois.
23    (24) Fuel consumed or used in the operation of ships,
24barges, or vessels that are used primarily in or for the
25transportation of property or the conveyance of persons for
26hire on rivers bordering on this State if the fuel is delivered

 

 

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

 

 

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1intent to title the vehicle in the state in which the purchaser
2is a resident within 30 days after the sale and of the fact of
3the payment to the State of Illinois of tax in an amount
4equivalent to the state's rate of tax on taxable property in
5his or her state of residence and shall submit the statement to
6the appropriate tax collection agency in his or her state of
7residence. In addition, the retailer must retain a signed copy
8of the statement in his or her records. Nothing in this item
9shall be construed to require the removal of the vehicle from
10this state following the filing of an intent to title the
11vehicle in the purchaser's state of residence if the purchaser
12titles the vehicle in his or her state of residence within 30
13days after the date of sale. The tax collected under this Act
14in accordance with this item (25-5) shall be proportionately
15distributed as if the tax were collected at the 6.25% general
16rate imposed under this Act.
17    (25-7) Beginning on July 1, 2007, no tax is imposed under
18this Act on the sale of an aircraft, as defined in Section 3 of
19the Illinois Aeronautics Act, if all of the following
20conditions are met:
21        (1) the aircraft leaves this State within 15 days after
22    the later of either the issuance of the final billing for
23    the sale of the aircraft, or the authorized approval for
24    return to service, completion of the maintenance record
25    entry, and completion of the test flight and ground test
26    for inspection, as required by 14 C.F.R. 91.407;

 

 

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1        (2) the aircraft is not based or registered in this
2    State after the sale of the aircraft; and
3        (3) the seller retains in his or her books and records
4    and provides to the Department a signed and dated
5    certification from the purchaser, on a form prescribed by
6    the Department, certifying that the requirements of this
7    item (25-7) are met. The certificate must also include the
8    name and address of the purchaser, the address of the
9    location where the aircraft is to be titled or registered,
10    the address of the primary physical location of the
11    aircraft, and other information that the Department may
12    reasonably require.
13    For purposes of this item (25-7):
14    "Based in this State" means hangared, stored, or otherwise
15used, excluding post-sale customizations as defined in this
16Section, for 10 or more days in each 12-month period
17immediately following the date of the sale of the aircraft.
18    "Registered in this State" means an aircraft registered
19with the Department of Transportation, Aeronautics Division,
20or titled or registered with the Federal Aviation
21Administration to an address located in this State.
22    This paragraph (25-7) is exempt from the provisions of
23Section 2-70.
24    (26) Semen used for artificial insemination of livestock
25for direct agricultural production.
26    (27) Horses, or interests in horses, registered with and

 

 

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1meeting the requirements of any of the Arabian Horse Club
2Registry of America, Appaloosa Horse Club, American Quarter
3Horse Association, United States Trotting Association, or
4Jockey Club, as appropriate, used for purposes of breeding or
5racing for prizes. This item (27) is exempt from the provisions
6of Section 2-70, and the exemption provided for under this item
7(27) applies for all periods beginning May 30, 1995, but no
8claim for credit or refund is allowed on or after January 1,
92008 (the effective date of Public Act 95-88) for such taxes
10paid during the period beginning May 30, 2000 and ending on
11January 1, 2008 (the effective date of Public Act 95-88).
12    (28) Computers and communications equipment utilized for
13any hospital purpose and equipment used in the diagnosis,
14analysis, or treatment of hospital patients sold to a lessor
15who leases the equipment, under a lease of one year or longer
16executed or in effect at the time of the purchase, to a
17hospital that has been issued an active tax exemption
18identification number by the Department under Section 1g of
19this Act.
20    (29) Personal property sold to a lessor who leases the
21property, under a lease of one year or longer executed or in
22effect at the time of the purchase, to a governmental body that
23has been issued an active tax exemption identification number
24by the Department under Section 1g of this Act.
25    (30) Beginning with taxable years ending on or after
26December 31, 1995 and ending with taxable years ending on or

 

 

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1before December 31, 2004, personal property that is donated for
2disaster relief to be used in a State or federally declared
3disaster area in Illinois or bordering Illinois by a
4manufacturer or retailer that is registered in this State to a
5corporation, society, association, foundation, or institution
6that has been issued a sales tax exemption identification
7number by the Department that assists victims of the disaster
8who reside within the declared disaster area.
9    (31) Beginning with taxable years ending on or after
10December 31, 1995 and ending with taxable years ending on or
11before December 31, 2004, personal property that is used in the
12performance of infrastructure repairs in this State, including
13but not limited to municipal roads and streets, access roads,
14bridges, sidewalks, waste disposal systems, water and sewer
15line extensions, water distribution and purification
16facilities, storm water drainage and retention facilities, and
17sewage treatment facilities, resulting from a State or
18federally declared disaster in Illinois or bordering Illinois
19when such repairs are initiated on facilities located in the
20declared disaster area within 6 months after the disaster.
21    (32) Beginning July 1, 1999, game or game birds sold at a
22"game breeding and hunting preserve area" as that term is used
23in the Wildlife Code. This paragraph is exempt from the
24provisions of Section 2-70.
25    (33) A motor vehicle, as that term is defined in Section
261-146 of the Illinois Vehicle Code, that is donated to a

 

 

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

 

 

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1another individual or entity that sold the property for the
2purpose of resale by the fundraising entity and that profits
3from the sale to the fundraising entity. This paragraph is
4exempt from the provisions of Section 2-70.
5    (35) Beginning January 1, 2000 and through December 31,
62001, new or used automatic vending machines that prepare and
7serve hot food and beverages, including coffee, soup, and other
8items, and replacement parts for these machines. Beginning
9January 1, 2002 and through June 30, 2003, machines and parts
10for machines used in commercial, coin-operated amusement and
11vending business if a use or occupation tax is paid on the
12gross receipts derived from the use of the commercial,
13coin-operated amusement and vending machines. This paragraph
14is exempt from the provisions of Section 2-70.
15    (35-5) Beginning August 23, 2001 and through June 30, 2016,
16food for human consumption that is to be consumed off the
17premises where it is sold (other than alcoholic beverages, soft
18drinks, and food that has been prepared for immediate
19consumption) and prescription and nonprescription medicines,
20drugs, medical appliances, and insulin, urine testing
21materials, syringes, and needles used by diabetics, for human
22use, when purchased for use by a person receiving medical
23assistance under Article V of the Illinois Public Aid Code who
24resides in a licensed long-term care facility, as defined in
25the Nursing Home Care Act, or a licensed facility as defined in
26the ID/DD Community Care Act, the MC/DD Act, or the Specialized

 

 

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1Mental Health Rehabilitation Act of 2013.
2    (36) Beginning August 2, 2001, computers and
3communications equipment utilized for any hospital purpose and
4equipment used in the diagnosis, analysis, or treatment of
5hospital patients sold to a lessor who leases the equipment,
6under a lease of one year or longer executed or in effect at
7the time of the purchase, to a hospital that has been issued an
8active tax exemption identification number by the Department
9under Section 1g of this Act. This paragraph is exempt from the
10provisions of Section 2-70.
11    (37) Beginning August 2, 2001, personal property sold to a
12lessor who leases the property, under a lease of one year or
13longer executed or in effect at the time of the purchase, to a
14governmental body that has been issued an active tax exemption
15identification number by the Department under Section 1g of
16this Act. This paragraph is exempt from the provisions of
17Section 2-70.
18    (38) Beginning on January 1, 2002 and through June 30,
192016, tangible personal property purchased from an Illinois
20retailer by a taxpayer engaged in centralized purchasing
21activities in Illinois who will, upon receipt of the property
22in Illinois, temporarily store the property in Illinois (i) for
23the purpose of subsequently transporting it outside this State
24for use or consumption thereafter solely outside this State or
25(ii) for the purpose of being processed, fabricated, or
26manufactured into, attached to, or incorporated into other

 

 

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1tangible personal property to be transported outside this State
2and thereafter used or consumed solely outside this State. The
3Director of Revenue shall, pursuant to rules adopted in
4accordance with the Illinois Administrative Procedure Act,
5issue a permit to any taxpayer in good standing with the
6Department who is eligible for the exemption under this
7paragraph (38). The permit issued under this paragraph (38)
8shall authorize the holder, to the extent and in the manner
9specified in the rules adopted under this Act, to purchase
10tangible personal property from a retailer exempt from the
11taxes imposed by this Act. Taxpayers shall maintain all
12necessary books and records to substantiate the use and
13consumption of all such tangible personal property outside of
14the State of Illinois.
15    (39) Beginning January 1, 2008, tangible personal property
16used in the construction or maintenance of a community water
17supply, as defined under Section 3.145 of the Environmental
18Protection Act, that is operated by a not-for-profit
19corporation that holds a valid water supply permit issued under
20Title IV of the Environmental Protection Act. This paragraph is
21exempt from the provisions of Section 2-70.
22    (40) Beginning January 1, 2010, materials, parts,
23equipment, components, and furnishings incorporated into or
24upon an aircraft as part of the modification, refurbishment,
25completion, replacement, repair, or maintenance of the
26aircraft. This exemption includes consumable supplies used in

 

 

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1the modification, refurbishment, completion, replacement,
2repair, and maintenance of aircraft, but excludes any
3materials, parts, equipment, components, and consumable
4supplies used in the modification, replacement, repair, and
5maintenance of aircraft engines or power plants, whether such
6engines or power plants are installed or uninstalled upon any
7such aircraft. "Consumable supplies" include, but are not
8limited to, adhesive, tape, sandpaper, general purpose
9lubricants, cleaning solution, latex gloves, and protective
10films. This exemption applies only to the sale of qualifying
11tangible personal property to persons who modify, refurbish,
12complete, replace, or maintain an aircraft and who (i) hold an
13Air Agency Certificate and are empowered to operate an approved
14repair station by the Federal Aviation Administration, (ii)
15have a Class IV Rating, and (iii) conduct operations in
16accordance with Part 145 of the Federal Aviation Regulations.
17The exemption does not include aircraft operated by a
18commercial air carrier providing scheduled passenger air
19service pursuant to authority issued under Part 121 or Part 129
20of the Federal Aviation Regulations. The changes made to this
21paragraph (40) by Public Act 98-534 are declarative of existing
22law.
23    (41) Tangible personal property sold to a
24public-facilities corporation, as described in Section
2511-65-10 of the Illinois Municipal Code, for purposes of
26constructing or furnishing a municipal convention hall, but

 

 

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1only if the legal title to the municipal convention hall is
2transferred to the municipality without any further
3consideration by or on behalf of the municipality at the time
4of the completion of the municipal convention hall or upon the
5retirement or redemption of any bonds or other debt instruments
6issued by the public-facilities corporation in connection with
7the development of the municipal convention hall. This
8exemption includes existing public-facilities corporations as
9provided in Section 11-65-25 of the Illinois Municipal Code.
10This paragraph is exempt from the provisions of Section 2-70.
11    (42) Tangible personal property produced by a manufacturer
12and provided free of charge to consumers as a sample of the
13manufacturer's product for the purpose of encouraging
14consumers to purchase the same or similar items produced by the
15manufacturer. This paragraph is exempt from the provisions of
16Section 2-70.
17(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
1898-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-574, eff.
191-1-14; 98-583, eff. 1-1-14; 98-756, eff. 7-16-14; 99-180, eff.
207-29-15.)
 
21    Section 99. Effective date. This Act takes effect upon
22becoming law.