102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB3880

 

Introduced 2/22/2021, by Rep. Anthony DeLuca

 

SYNOPSIS AS INTRODUCED:
 
65 ILCS 5/8-11-1  from Ch. 24, par. 8-11-1
65 ILCS 5/8-11-1.3  from Ch. 24, par. 8-11-1.3
65 ILCS 5/8-11-1.4  from Ch. 24, par. 8-11-1.4
65 ILCS 5/8-11-1.6
65 ILCS 5/8-11-1.7
65 ILCS 5/8-11-5  from Ch. 24, par. 8-11-5
65 ILCS 5/8-11-6  from Ch. 24, par. 8-11-6

    Amends the Illinois Municipal Code. Provides that a municipality may, by ordinance, provide that its use and occupation taxes shall be collected and enforced by the municipality (currently, the Department of Revenue). Provides that, if the tax is collected and enforced by the municipality, none of the proceeds collected from the tax shall be transferred into the Tax Compliance and Administration Fund. Effective immediately.


LRB102 02597 AWJ 12600 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB3880LRB102 02597 AWJ 12600 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Municipal Code is amended by
5changing Sections 8-11-1, 8-11-1.3, 8-11-1.4, 8-11-1.6,
68-11-1.7, 8-11-5, and 8-11-6 as follows:
 
7    (65 ILCS 5/8-11-1)  (from Ch. 24, par. 8-11-1)
8    Sec. 8-11-1. Home Rule Municipal Retailers' Occupation Tax
9Act. The corporate authorities of a home rule municipality may
10impose a tax upon all persons engaged in the business of
11selling tangible personal property, other than an item of
12tangible personal property titled or registered with an agency
13of this State's government, at retail in the municipality on
14the gross receipts from these sales made in the course of such
15business. If imposed, the tax shall only be imposed in 1/4%
16increments. On and after September 1, 1991, this additional
17tax may not be imposed on tangible personal property taxed at
18the 1% rate under the Retailers' Occupation Tax Act. Beginning
19December 1, 2019, this tax is not imposed on sales of aviation
20fuel unless the tax revenue is expended for airport-related
21purposes. If a municipality does not have an airport-related
22purpose to which it dedicates aviation fuel tax revenue, then
23aviation fuel is excluded from the tax. Each municipality must

 

 

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1comply with the certification requirements for airport-related
2purposes under Section 2-22 of the Retailers' Occupation Tax
3Act. For purposes of this Section, "airport-related purposes"
4has the meaning ascribed in Section 6z-20.2 of the State
5Finance Act. This exclusion for aviation fuel only applies for
6so long as the revenue use requirements of 49 U.S.C. 47107(b)
7and 49 U.S.C. 47133 are binding on the municipality. The
8changes made to this Section by this amendatory Act of the
9101st General Assembly are a denial and limitation of home
10rule powers and functions under subsection (g) of Section 6 of
11Article VII of the Illinois Constitution. The tax imposed by a
12home rule municipality under this Section and all civil
13penalties that may be assessed as an incident of the tax shall
14be collected and enforced by the State Department of Revenue,
15except that a municipality may, by ordinance, provide that the
16tax shall be collected and enforced by the municipality. If
17the tax is collected and enforced by the municipality, none of
18the proceeds collected from the tax shall be transferred into
19the Tax Compliance and Administration Fund. The certificate of
20registration that is issued by the Department to a retailer
21under the Retailers' Occupation Tax Act shall permit the
22retailer to engage in a business that is taxable under any
23ordinance or resolution enacted pursuant to this Section
24without registering separately with the Department under such
25ordinance or resolution or under this Section. The Department
26shall have full power to administer and enforce this Section;

 

 

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1to collect all taxes and penalties due hereunder; to dispose
2of taxes and penalties so collected in the manner hereinafter
3provided; and to determine all rights to credit memoranda
4arising on account of the erroneous payment of tax or penalty
5hereunder. In the administration of, and compliance with, this
6Section the Department and persons who are subject to this
7Section shall have the same rights, remedies, privileges,
8immunities, powers and duties, and be subject to the same
9conditions, restrictions, limitations, penalties and
10definitions of terms, and employ the same modes of procedure,
11as are prescribed in Sections 1, 1a, 1d, 1e, 1f, 1i, 1j, 1k,
121m, 1n, 2 through 2-65 (in respect to all provisions therein
13other than the State rate of tax), 2c, 3 (except as to the
14disposition of taxes and penalties collected, and except that
15the retailer's discount is not allowed for taxes paid on
16aviation fuel that are subject to the revenue use requirements
17of 49 U.S.C. 47107(b) and 49 U.S.C. 47133), 4, 5, 5a, 5b, 5c,
185d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 6d, 7, 8, 9,
1910, 11, 12 and 13 of the Retailers' Occupation Tax Act and
20Section 3-7 of the Uniform Penalty and Interest Act, as fully
21as if those provisions were set forth herein.
22    No tax may be imposed by a home rule municipality under
23this Section unless the municipality also imposes a tax at the
24same rate under Section 8-11-5 of this Act.
25    Persons subject to any tax imposed under the authority
26granted in this Section may reimburse themselves for their

 

 

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1seller's tax liability hereunder by separately stating that
2tax as an additional charge, which charge may be stated in
3combination, in a single amount, with State tax which sellers
4are required to collect under the Use Tax Act, pursuant to such
5bracket schedules as the Department may prescribe.
6    Whenever the Department determines that a refund should be
7made under this Section to a claimant instead of issuing a
8credit memorandum, the Department shall notify the State
9Comptroller, who shall cause the order to be drawn for the
10amount specified and to the person named in the notification
11from the Department. The refund shall be paid by the State
12Treasurer out of the home rule municipal retailers' occupation
13tax fund or the Local Government Aviation Trust Fund, as
14appropriate.
15    Except as otherwise provided in this paragraph, the
16Department shall immediately pay over to the State Treasurer,
17ex officio, as trustee, all taxes and penalties collected
18hereunder for deposit into the Home Rule Municipal Retailers'
19Occupation Tax Fund. Taxes and penalties collected on aviation
20fuel sold on or after December 1, 2019, shall be immediately
21paid over by the Department to the State Treasurer, ex
22officio, as trustee, for deposit into the Local Government
23Aviation Trust Fund. The Department shall only pay moneys into
24the Local Government Aviation Trust Fund under this Section
25for so long as the revenue use requirements of 49 U.S.C.
2647107(b) and 49 U.S.C. 47133 are binding on the State.

 

 

HB3880- 5 -LRB102 02597 AWJ 12600 b

1    As soon as possible after the first day of each month,
2beginning January 1, 2011, upon certification of the
3Department of Revenue, the Comptroller shall order
4transferred, and the Treasurer shall transfer, to the STAR
5Bonds Revenue Fund the local sales tax increment, as defined
6in the Innovation Development and Economy Act, collected under
7this Section during the second preceding calendar month for
8sales within a STAR bond district.
9    After the monthly transfer to the STAR Bonds Revenue Fund,
10on or before the 25th day of each calendar month, the
11Department shall prepare and certify to the Comptroller the
12disbursement of stated sums of money to named municipalities,
13the municipalities to be those from which retailers have paid
14taxes or penalties hereunder to the Department during the
15second preceding calendar month. The amount to be paid to each
16municipality shall be the amount (not including credit
17memoranda and not including taxes and penalties collected on
18aviation fuel sold on or after December 1, 2019) collected
19hereunder during the second preceding calendar month by the
20Department plus an amount the Department determines is
21necessary to offset any amounts that were erroneously paid to
22a different taxing body, and not including an amount equal to
23the amount of refunds made during the second preceding
24calendar month by the Department on behalf of such
25municipality, and not including any amount that the Department
26determines is necessary to offset any amounts that were

 

 

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1payable to a different taxing body but were erroneously paid
2to the municipality, and not including any amounts that are
3transferred to the STAR Bonds Revenue Fund, less 1.5% of the
4remainder, which the Department shall transfer into the Tax
5Compliance and Administration Fund. The Department, at the
6time of each monthly disbursement to the municipalities, shall
7prepare and certify to the State Comptroller the amount to be
8transferred into the Tax Compliance and Administration Fund
9under this Section. Within 10 days after receipt by the
10Comptroller of the disbursement certification to the
11municipalities and the Tax Compliance and Administration Fund
12provided for in this Section to be given to the Comptroller by
13the Department, the Comptroller shall cause the orders to be
14drawn for the respective amounts in accordance with the
15directions contained in the certification.
16    In addition to the disbursement required by the preceding
17paragraph and in order to mitigate delays caused by
18distribution procedures, an allocation shall, if requested, be
19made within 10 days after January 14, 1991, and in November of
201991 and each year thereafter, to each municipality that
21received more than $500,000 during the preceding fiscal year,
22(July 1 through June 30) whether collected by the municipality
23or disbursed by the Department as required by this Section.
24Within 10 days after January 14, 1991, participating
25municipalities shall notify the Department in writing of their
26intent to participate. In addition, for the initial

 

 

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1distribution, participating municipalities shall certify to
2the Department the amounts collected by the municipality for
3each month under its home rule occupation and service
4occupation tax during the period July 1, 1989 through June 30,
51990. The allocation within 10 days after January 14, 1991,
6shall be in an amount equal to the monthly average of these
7amounts, excluding the 2 months of highest receipts. The
8monthly average for the period of July 1, 1990 through June 30,
91991 will be determined as follows: the amounts collected by
10the municipality under its home rule occupation and service
11occupation tax during the period of July 1, 1990 through
12September 30, 1990, plus amounts collected by the Department
13and paid to such municipality through June 30, 1991, excluding
14the 2 months of highest receipts. The monthly average for each
15subsequent period of July 1 through June 30 shall be an amount
16equal to the monthly distribution made to each such
17municipality under the preceding paragraph during this period,
18excluding the 2 months of highest receipts. The distribution
19made in November 1991 and each year thereafter under this
20paragraph and the preceding paragraph shall be reduced by the
21amount allocated and disbursed under this paragraph in the
22preceding period of July 1 through June 30. The Department
23shall prepare and certify to the Comptroller for disbursement
24the allocations made in accordance with this paragraph.
25    For the purpose of determining the local governmental unit
26whose tax is applicable, a retail sale by a producer of coal or

 

 

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1other mineral mined in Illinois is a sale at retail at the
2place where the coal or other mineral mined in Illinois is
3extracted from the earth. This paragraph does not apply to
4coal or other mineral when it is delivered or shipped by the
5seller to the purchaser at a point outside Illinois so that the
6sale is exempt under the United States Constitution as a sale
7in interstate or foreign commerce.
8    Nothing in this Section shall be construed to authorize a
9municipality to impose a tax upon the privilege of engaging in
10any business which under the Constitution of the United States
11may not be made the subject of taxation by this State.
12    An ordinance or resolution imposing or discontinuing a tax
13hereunder or effecting a change in the rate thereof shall be
14adopted and a certified copy thereof filed with the Department
15on or before the first day of June, whereupon the Department
16shall proceed to administer and enforce this Section as of the
17first day of September next following the adoption and filing.
18Beginning January 1, 1992, an ordinance or resolution imposing
19or discontinuing the tax hereunder or effecting a change in
20the rate thereof shall be adopted and a certified copy thereof
21filed with the Department on or before the first day of July,
22whereupon the Department shall proceed to administer and
23enforce this Section as of the first day of October next
24following such adoption and filing. Beginning January 1, 1993,
25an ordinance or resolution imposing or discontinuing the tax
26hereunder or effecting a change in the rate thereof shall be

 

 

HB3880- 9 -LRB102 02597 AWJ 12600 b

1adopted and a certified copy thereof filed with the Department
2on or before the first day of October, whereupon the
3Department shall proceed to administer and enforce this
4Section as of the first day of January next following the
5adoption and filing. However, a municipality located in a
6county with a population in excess of 3,000,000 that elected
7to become a home rule unit at the general primary election in
81994 may adopt an ordinance or resolution imposing the tax
9under this Section and file a certified copy of the ordinance
10or resolution with the Department on or before July 1, 1994.
11The Department shall then proceed to administer and enforce
12this Section as of October 1, 1994. Beginning April 1, 1998, an
13ordinance or resolution imposing or discontinuing the tax
14hereunder or effecting a change in the rate thereof shall
15either (i) be adopted and a certified copy thereof filed with
16the Department on or before the first day of April, whereupon
17the Department shall proceed to administer and enforce this
18Section as of the first day of July next following the adoption
19and filing; or (ii) be adopted and a certified copy thereof
20filed with the Department on or before the first day of
21October, whereupon the Department shall proceed to administer
22and enforce this Section as of the first day of January next
23following the adoption and filing.
24    When certifying the amount of a monthly disbursement to a
25municipality under this Section, the Department shall increase
26or decrease the amount by an amount necessary to offset any

 

 

HB3880- 10 -LRB102 02597 AWJ 12600 b

1misallocation of previous disbursements. The offset amount
2shall be the amount erroneously disbursed within the previous
36 months from the time a misallocation is discovered.
4    Any unobligated balance remaining in the Municipal
5Retailers' Occupation Tax Fund on December 31, 1989, which
6fund was abolished by Public Act 85-1135, and all receipts of
7municipal tax as a result of audits of liability periods prior
8to January 1, 1990, shall be paid into the Local Government Tax
9Fund for distribution as provided by this Section prior to the
10enactment of Public Act 85-1135. All receipts of municipal tax
11as a result of an assessment not arising from an audit, for
12liability periods prior to January 1, 1990, shall be paid into
13the Local Government Tax Fund for distribution before July 1,
141990, as provided by this Section prior to the enactment of
15Public Act 85-1135; and on and after July 1, 1990, all such
16receipts shall be distributed as provided in Section 6z-18 of
17the State Finance Act.
18    As used in this Section, "municipal" and "municipality"
19means a city, village or incorporated town, including an
20incorporated town that has superseded a civil township.
21    This Section shall be known and may be cited as the Home
22Rule Municipal Retailers' Occupation Tax Act.
23(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
24100-1171, eff. 1-4-19; 101-10, eff. 6-5-19; 101-81, eff.
257-12-19; 101-604, eff. 12-13-19.)
 

 

 

HB3880- 11 -LRB102 02597 AWJ 12600 b

1    (65 ILCS 5/8-11-1.3)  (from Ch. 24, par. 8-11-1.3)
2    Sec. 8-11-1.3. Non-Home Rule Municipal Retailers'
3Occupation Tax Act. The corporate authorities of a non-home
4rule municipality may impose a tax upon all persons engaged in
5the business of selling tangible personal property, other than
6on an item of tangible personal property which is titled and
7registered by an agency of this State's Government, at retail
8in the municipality for expenditure on public infrastructure
9or for property tax relief or both as defined in Section
108-11-1.2 if approved by referendum as provided in Section
118-11-1.1, of the gross receipts from such sales made in the
12course of such business. If the tax is approved by referendum
13on or after July 14, 2010 (the effective date of Public Act
1496-1057), the corporate authorities of a non-home rule
15municipality may, until July 1, 2030, use the proceeds of the
16tax for expenditure on municipal operations, in addition to or
17in lieu of any expenditure on public infrastructure or for
18property tax relief. The tax imposed may not be more than 1%
19and may be imposed only in 1/4% increments. The tax may not be
20imposed on tangible personal property taxed at the 1% rate
21under the Retailers' Occupation Tax Act. Beginning December 1,
222019, this tax is not imposed on sales of aviation fuel unless
23the tax revenue is expended for airport-related purposes. If a
24municipality does not have an airport-related purpose to which
25it dedicates aviation fuel tax revenue, then aviation fuel is
26excluded from the tax. Each municipality must comply with the

 

 

HB3880- 12 -LRB102 02597 AWJ 12600 b

1certification requirements for airport-related purposes under
2Section 2-22 of the Retailers' Occupation Tax Act. For
3purposes of this Section, "airport-related purposes" has the
4meaning ascribed in Section 6z-20.2 of the State Finance Act.
5This exclusion for aviation fuel only applies for so long as
6the revenue use requirements of 49 U.S.C. 47107(b) and 49
7U.S.C. 47133 are binding on the municipality. The tax imposed
8by a municipality pursuant to this Section and all civil
9penalties that may be assessed as an incident thereof shall be
10collected and enforced by the State Department of Revenue,
11except that a municipality may, by ordinance, provide that the
12tax shall be collected and enforced by the municipality. If
13the tax is collected and enforced by the municipality, none of
14the proceeds collected from the tax shall be transferred into
15the Tax Compliance and Administration Fund. The certificate of
16registration which is issued by the Department to a retailer
17under the Retailers' Occupation Tax Act shall permit such
18retailer to engage in a business which is taxable under any
19ordinance or resolution enacted pursuant to this Section
20without registering separately with the Department under such
21ordinance or resolution or under this Section. The Department
22shall have full power to administer and enforce this Section;
23to collect all taxes and penalties due hereunder; to dispose
24of taxes and penalties so collected in the manner hereinafter
25provided, and to determine all rights to credit memoranda,
26arising on account of the erroneous payment of tax or penalty

 

 

HB3880- 13 -LRB102 02597 AWJ 12600 b

1hereunder. In the administration of, and compliance with, this
2Section, the Department and persons who are subject to this
3Section shall have the same rights, remedies, privileges,
4immunities, powers and duties, and be subject to the same
5conditions, restrictions, limitations, penalties and
6definitions of terms, and employ the same modes of procedure,
7as are prescribed in Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j,
82 through 2-65 (in respect to all provisions therein other
9than the State rate of tax), 2c, 3 (except as to the
10disposition of taxes and penalties collected, and except that
11the retailer's discount is not allowed for taxes paid on
12aviation fuel that are subject to the revenue use requirements
13of 49 U.S.C. 47107(b) and 49 U.S.C. 47133), 4, 5, 5a, 5b, 5c,
145d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 6d, 7, 8, 9,
1510, 11, 12 and 13 of the Retailers' Occupation Tax Act and
16Section 3-7 of the Uniform Penalty and Interest Act as fully as
17if those provisions were set forth herein.
18    No municipality may impose a tax under this Section unless
19the municipality also imposes a tax at the same rate under
20Section 8-11-1.4 of this Code.
21    Persons subject to any tax imposed pursuant to the
22authority granted in this Section may reimburse themselves for
23their seller's tax liability hereunder by separately stating
24such tax as an additional charge, which charge may be stated in
25combination, in a single amount, with State tax which sellers
26are required to collect under the Use Tax Act, pursuant to such

 

 

HB3880- 14 -LRB102 02597 AWJ 12600 b

1bracket schedules as the Department may prescribe.
2    Whenever the Department determines that a refund should be
3made under this Section to a claimant instead of issuing a
4credit memorandum, the Department shall notify the State
5Comptroller, who shall cause the order to be drawn for the
6amount specified, and to the person named, in such
7notification from the Department. Such refund shall be paid by
8the State Treasurer out of the non-home rule municipal
9retailers' occupation tax fund or the Local Government
10Aviation Trust Fund, as appropriate.
11    Except as otherwise provided, the Department shall
12forthwith pay over to the State Treasurer, ex officio, as
13trustee, all taxes and penalties collected hereunder for
14deposit into the Non-Home Rule Municipal Retailers' Occupation
15Tax Fund. Taxes and penalties collected on aviation fuel sold
16on or after December 1, 2019, shall be immediately paid over by
17the Department to the State Treasurer, ex officio, as trustee,
18for deposit into the Local Government Aviation Trust Fund. The
19Department shall only pay moneys into the Local Government
20Aviation Trust Fund under this Section for so long as the
21revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C.
2247133 are binding on the municipality.
23    As soon as possible after the first day of each month,
24beginning January 1, 2011, upon certification of the
25Department of Revenue, the Comptroller shall order
26transferred, and the Treasurer shall transfer, to the STAR

 

 

HB3880- 15 -LRB102 02597 AWJ 12600 b

1Bonds Revenue Fund the local sales tax increment, as defined
2in the Innovation Development and Economy Act, collected under
3this Section during the second preceding calendar month for
4sales within a STAR bond district.
5    After the monthly transfer to the STAR Bonds Revenue Fund,
6on or before the 25th day of each calendar month, the
7Department shall prepare and certify to the Comptroller the
8disbursement of stated sums of money to named municipalities,
9the municipalities to be those from which retailers have paid
10taxes or penalties hereunder to the Department during the
11second preceding calendar month. The amount to be paid to each
12municipality shall be the amount (not including credit
13memoranda and not including taxes and penalties collected on
14aviation fuel sold on or after December 1, 2019) collected
15hereunder during the second preceding calendar month by the
16Department plus an amount the Department determines is
17necessary to offset any amounts which were erroneously paid to
18a different taxing body, and not including an amount equal to
19the amount of refunds made during the second preceding
20calendar month by the Department on behalf of such
21municipality, and not including any amount which the
22Department determines is necessary to offset any amounts which
23were payable to a different taxing body but were erroneously
24paid to the municipality, and not including any amounts that
25are transferred to the STAR Bonds Revenue Fund, less 1.5% of
26the remainder, which the Department shall transfer into the

 

 

HB3880- 16 -LRB102 02597 AWJ 12600 b

1Tax Compliance and Administration Fund. The Department, at the
2time of each monthly disbursement to the municipalities, shall
3prepare and certify to the State Comptroller the amount to be
4transferred into the Tax Compliance and Administration Fund
5under this Section. Within 10 days after receipt, by the
6Comptroller, of the disbursement certification to the
7municipalities and the Tax Compliance and Administration Fund
8provided for in this Section to be given to the Comptroller by
9the Department, the Comptroller shall cause the orders to be
10drawn for the respective amounts in accordance with the
11directions contained in such certification.
12    For the purpose of determining the local governmental unit
13whose tax is applicable, a retail sale, by a producer of coal
14or other mineral mined in Illinois, is a sale at retail at the
15place where the coal or other mineral mined in Illinois is
16extracted from the earth. This paragraph does not apply to
17coal or other mineral when it is delivered or shipped by the
18seller to the purchaser at a point outside Illinois so that the
19sale is exempt under the Federal Constitution as a sale in
20interstate or foreign commerce.
21    Nothing in this Section shall be construed to authorize a
22municipality to impose a tax upon the privilege of engaging in
23any business which under the constitution of the United States
24may not be made the subject of taxation by this State.
25    When certifying the amount of a monthly disbursement to a
26municipality under this Section, the Department shall increase

 

 

HB3880- 17 -LRB102 02597 AWJ 12600 b

1or decrease such amount by an amount necessary to offset any
2misallocation of previous disbursements. The offset amount
3shall be the amount erroneously disbursed within the previous
46 months from the time a misallocation is discovered.
5    The Department of Revenue shall implement Public Act
691-649 so as to collect the tax on and after January 1, 2002.
7    As used in this Section, "municipal" and "municipality"
8mean a city, village, or incorporated town, including an
9incorporated town which has superseded a civil township.
10    This Section shall be known and may be cited as the
11Non-Home Rule Municipal Retailers' Occupation Tax Act.
12(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
13100-1171, eff. 1-4-19; 101-10, eff. 6-5-19; 101-47, eff.
141-1-20; 101-81, eff. 7-12-19; 101-604, eff. 12-13-19.)
 
15    (65 ILCS 5/8-11-1.4)  (from Ch. 24, par. 8-11-1.4)
16    Sec. 8-11-1.4. Non-Home Rule Municipal Service Occupation
17Tax Act. The corporate authorities of a non-home rule
18municipality may impose a tax upon all persons engaged, in
19such municipality, in the business of making sales of service
20for expenditure on public infrastructure or for property tax
21relief or both as defined in Section 8-11-1.2 if approved by
22referendum as provided in Section 8-11-1.1, of the selling
23price of all tangible personal property transferred by such
24servicemen either in the form of tangible personal property or
25in the form of real estate as an incident to a sale of service.

 

 

HB3880- 18 -LRB102 02597 AWJ 12600 b

1If the tax is approved by referendum on or after July 14, 2010
2(the effective date of Public Act 96-1057), the corporate
3authorities of a non-home rule municipality may, until
4December 31, 2020, use the proceeds of the tax for expenditure
5on municipal operations, in addition to or in lieu of any
6expenditure on public infrastructure or for property tax
7relief. The tax imposed may not be more than 1% and may be
8imposed only in 1/4% increments. The tax may not be imposed on
9tangible personal property taxed at the 1% rate under the
10Service Occupation Tax Act. Beginning December 1, 2019, this
11tax is not imposed on sales of aviation fuel unless the tax
12revenue is expended for airport-related purposes. If a
13municipality does not have an airport-related purpose to which
14it dedicates aviation fuel tax revenue, then aviation fuel is
15excluded from the tax. Each municipality must comply with the
16certification requirements for airport-related purposes under
17Section 2-22 of the Retailers' Occupation Tax Act. For
18purposes of this Section, "airport-related purposes" has the
19meaning ascribed in Section 6z-20.2 of the State Finance Act.
20This exclusion for aviation fuel only applies for so long as
21the revenue use requirements of 49 U.S.C. 47107(b) and 49
22U.S.C. 47133 are binding on the municipality. The tax imposed
23by a municipality pursuant to this Section and all civil
24penalties that may be assessed as an incident thereof shall be
25collected and enforced by the State Department of Revenue,
26except that a municipality may, by ordinance, provide that the

 

 

HB3880- 19 -LRB102 02597 AWJ 12600 b

1tax shall be collected and enforced by the municipality. If
2the tax is collected and enforced by the municipality, none of
3the proceeds collected from the tax shall be transferred into
4the Tax Compliance and Administration Fund. The certificate of
5registration which is issued by the Department to a retailer
6under the Retailers' Occupation Tax Act or under the Service
7Occupation Tax Act shall permit such registrant to engage in a
8business which is taxable under any ordinance or resolution
9enacted pursuant to this Section without registering
10separately with the Department under such ordinance or
11resolution or under this Section. The Department shall have
12full power to administer and enforce this Section; to collect
13all taxes and penalties due hereunder; to dispose of taxes and
14penalties so collected in the manner hereinafter provided, and
15to determine all rights to credit memoranda arising on account
16of the erroneous payment of tax or penalty hereunder. In the
17administration of, and compliance with, this Section the
18Department and persons who are subject to this Section shall
19have the same rights, remedies, privileges, immunities, powers
20and duties, and be subject to the same conditions,
21restrictions, limitations, penalties and definitions of terms,
22and employ the same modes of procedure, as are prescribed in
23Sections 1a-1, 2, 2a, 3 through 3-50 (in respect to all
24provisions therein other than the State rate of tax), 4
25(except that the reference to the State shall be to the taxing
26municipality), 5, 7, 8 (except that the jurisdiction to which

 

 

HB3880- 20 -LRB102 02597 AWJ 12600 b

1the tax shall be a debt to the extent indicated in that Section
28 shall be the taxing municipality), 9 (except as to the
3disposition of taxes and penalties collected, and except that
4the returned merchandise credit for this municipal tax may not
5be taken against any State tax, and except that the retailer's
6discount is not allowed for taxes paid on aviation fuel that
7are subject to the revenue use requirements of 49 U.S.C.
847107(b) and 49 U.S.C. 47133), 10, 11, 12 (except the
9reference therein to Section 2b of the Retailers' Occupation
10Tax Act), 13 (except that any reference to the State shall mean
11the taxing municipality), the first paragraph of Section 15,
1216, 17, 18, 19 and 20 of the Service Occupation Tax Act and
13Section 3-7 of the Uniform Penalty and Interest Act, as fully
14as if those provisions were set forth herein.
15    No municipality may impose a tax under this Section unless
16the municipality also imposes a tax at the same rate under
17Section 8-11-1.3 of this Code.
18    Persons subject to any tax imposed pursuant to the
19authority granted in this Section may reimburse themselves for
20their serviceman's tax liability hereunder by separately
21stating such tax as an additional charge, which charge may be
22stated in combination, in a single amount, with State tax
23which servicemen are authorized to collect under the Service
24Use Tax Act, pursuant to such bracket schedules as the
25Department may prescribe.
26    Whenever the Department determines that a refund should be

 

 

HB3880- 21 -LRB102 02597 AWJ 12600 b

1made under this Section to a claimant instead of issuing
2credit memorandum, the Department shall notify the State
3Comptroller, who shall cause the order to be drawn for the
4amount specified, and to the person named, in such
5notification from the Department. Such refund shall be paid by
6the State Treasurer out of the municipal retailers' occupation
7tax fund or the Local Government Aviation Trust Fund, as
8appropriate.
9    Except as otherwise provided in this paragraph, the
10Department shall forthwith pay over to the State Treasurer, ex
11officio, as trustee, all taxes and penalties collected
12hereunder for deposit into the municipal retailers' occupation
13tax fund. Taxes and penalties collected on aviation fuel sold
14on or after December 1, 2019, shall be immediately paid over by
15the Department to the State Treasurer, ex officio, as trustee,
16for deposit into the Local Government Aviation Trust Fund. The
17Department shall only pay moneys into the Local Government
18Aviation Trust Fund under this Section for so long as the
19revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C.
2047133 are binding on the municipality.
21    As soon as possible after the first day of each month,
22beginning January 1, 2011, upon certification of the
23Department of Revenue, the Comptroller shall order
24transferred, and the Treasurer shall transfer, to the STAR
25Bonds Revenue Fund the local sales tax increment, as defined
26in the Innovation Development and Economy Act, collected under

 

 

HB3880- 22 -LRB102 02597 AWJ 12600 b

1this Section during the second preceding calendar month for
2sales within a STAR bond district.
3    After the monthly transfer to the STAR Bonds Revenue Fund,
4on or before the 25th day of each calendar month, the
5Department shall prepare and certify to the Comptroller the
6disbursement of stated sums of money to named municipalities,
7the municipalities to be those from which suppliers and
8servicemen have paid taxes or penalties hereunder to the
9Department during the second preceding calendar month. The
10amount to be paid to each municipality shall be the amount (not
11including credit memoranda and not including taxes and
12penalties collected on aviation fuel sold on or after December
131, 2019) collected hereunder during the second preceding
14calendar month by the Department, and not including an amount
15equal to the amount of refunds made during the second
16preceding calendar month by the Department on behalf of such
17municipality, and not including any amounts that are
18transferred to the STAR Bonds Revenue Fund, less 1.5% of the
19remainder, which the Department shall transfer into the Tax
20Compliance and Administration Fund. The Department, at the
21time of each monthly disbursement to the municipalities, shall
22prepare and certify to the State Comptroller the amount to be
23transferred into the Tax Compliance and Administration Fund
24under this Section. Within 10 days after receipt, by the
25Comptroller, of the disbursement certification to the
26municipalities, the General Revenue Fund, and the Tax

 

 

HB3880- 23 -LRB102 02597 AWJ 12600 b

1Compliance and Administration Fund provided for in this
2Section to be given to the Comptroller by the Department, the
3Comptroller shall cause the orders to be drawn for the
4respective amounts in accordance with the directions contained
5in such certification.
6    The Department of Revenue shall implement Public Act
791-649 so as to collect the tax on and after January 1, 2002.
8    Nothing in this Section shall be construed to authorize a
9municipality to impose a tax upon the privilege of engaging in
10any business which under the constitution of the United States
11may not be made the subject of taxation by this State.
12    As used in this Section, "municipal" or "municipality"
13means or refers to a city, village or incorporated town,
14including an incorporated town which has superseded a civil
15township.
16    This Section shall be known and may be cited as the
17"Non-Home Rule Municipal Service Occupation Tax Act".
18(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
19100-1171, eff. 1-4-19; 101-10, eff. 6-5-19; 101-81, eff.
207-12-19; 101-604, eff. 12-13-19.)
 
21    (65 ILCS 5/8-11-1.6)
22    Sec. 8-11-1.6. Non-home rule municipal retailers'
23occupation tax; municipalities between 20,000 and 25,000. The
24corporate authorities of a non-home rule municipality with a
25population of more than 20,000 but less than 25,000 that has,

 

 

HB3880- 24 -LRB102 02597 AWJ 12600 b

1prior to January 1, 1987, established a Redevelopment Project
2Area that has been certified as a State Sales Tax Boundary and
3has issued bonds or otherwise incurred indebtedness to pay for
4costs in excess of $5,000,000, which is secured in part by a
5tax increment allocation fund, in accordance with the
6provisions of Division 11-74.4 of this Code may, by passage of
7an ordinance, impose a tax upon all persons engaged in the
8business of selling tangible personal property, other than on
9an item of tangible personal property that is titled and
10registered by an agency of this State's Government, at retail
11in the municipality. This tax may not be imposed on tangible
12personal property taxed at the 1% rate under the Retailers'
13Occupation Tax Act. Beginning December 1, 2019, this tax is
14not imposed on sales of aviation fuel unless the tax revenue is
15expended for airport-related purposes. If a municipality does
16not have an airport-related purpose to which it dedicates
17aviation fuel tax revenue, then aviation fuel is excluded from
18the tax. Each municipality must comply with the certification
19requirements for airport-related purposes under Section 2-22
20of the Retailers' Occupation Tax Act. For purposes of this
21Section, "airport-related purposes" has the meaning ascribed
22in Section 6z-20.2 of the State Finance Act. This exclusion
23for aviation fuel only applies for so long as the revenue use
24requirements of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are
25binding on the municipality. If imposed, the tax shall only be
26imposed in .25% increments of the gross receipts from such

 

 

HB3880- 25 -LRB102 02597 AWJ 12600 b

1sales made in the course of business. Any tax imposed by a
2municipality under this Section and all civil penalties that
3may be assessed as an incident thereof shall be collected and
4enforced by the State Department of Revenue, except that a
5municipality may, by ordinance, provide that the tax shall be
6collected and enforced by the municipality. If the tax is
7collected and enforced by the municipality, none of the
8proceeds collected from the tax shall be transferred into the
9Tax Compliance and Administration Fund. An ordinance imposing
10a tax hereunder or effecting a change in the rate thereof shall
11be adopted and a certified copy thereof filed with the
12Department on or before the first day of October, whereupon
13the Department shall proceed to administer and enforce this
14Section as of the first day of January next following such
15adoption and filing. The certificate of registration that is
16issued by the Department to a retailer under the Retailers'
17Occupation Tax Act shall permit the retailer to engage in a
18business that is taxable under any ordinance or resolution
19enacted under this Section without registering separately with
20the Department under the ordinance or resolution or under this
21Section. The Department shall have full power to administer
22and enforce this Section, to collect all taxes and penalties
23due hereunder, to dispose of taxes and penalties so collected
24in the manner hereinafter provided, and to determine all
25rights to credit memoranda, arising on account of the
26erroneous payment of tax or penalty hereunder. In the

 

 

HB3880- 26 -LRB102 02597 AWJ 12600 b

1administration of, and compliance with this Section, the
2Department and persons who are subject to this Section shall
3have the same rights, remedies, privileges, immunities,
4powers, and duties, and be subject to the same conditions,
5restrictions, limitations, penalties, and definitions of
6terms, and employ the same modes of procedure, as are
7prescribed in Sections 1, 1a, 1a-1, 1d, 1e, 1f, 1i, 1j, 2
8through 2-65 (in respect to all provisions therein other than
9the State rate of tax), 2c, 3 (except as to the disposition of
10taxes and penalties collected, and except that the retailer's
11discount is not allowed for taxes paid on aviation fuel that
12are subject to the revenue use requirements of 49 U.S.C.
1347107(b) and 49 U.S.C. 47133), 4, 5, 5a, 5b, 5c, 5d, 5e, 5f,
145g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 6d, 7, 8, 9, 10, 11, 12
15and 13 of the Retailers' Occupation Tax Act and Section 3-7 of
16the Uniform Penalty and Interest Act as fully as if those
17provisions were set forth herein.
18    A tax may not be imposed by a municipality under this
19Section unless the municipality also imposes a tax at the same
20rate under Section 8-11-1.7 of this Act.
21    Persons subject to any tax imposed under the authority
22granted in this Section may reimburse themselves for their
23seller's tax liability hereunder by separately stating the tax
24as an additional charge, which charge may be stated in
25combination, in a single amount, with State tax which sellers
26are required to collect under the Use Tax Act, pursuant to such

 

 

HB3880- 27 -LRB102 02597 AWJ 12600 b

1bracket schedules as the Department may prescribe.
2    Whenever the Department determines that a refund should be
3made under this Section to a claimant, instead of issuing a
4credit memorandum, the Department shall notify the State
5Comptroller, who shall cause the order to be drawn for the
6amount specified, and to the person named in the notification
7from the Department. The refund shall be paid by the State
8Treasurer out of the Non-Home Rule Municipal Retailers'
9Occupation Tax Fund, which is hereby created or the Local
10Government Aviation Trust Fund, as appropriate.
11    Except as otherwise provided in this paragraph, the
12Department shall forthwith pay over to the State Treasurer, ex
13officio, as trustee, all taxes and penalties collected
14hereunder for deposit into the Non-Home Rule Municipal
15Retailers' Occupation Tax Fund. Taxes and penalties collected
16on aviation fuel sold on or after December 1, 2019, shall be
17immediately paid over by the Department to the State
18Treasurer, ex officio, as trustee, for deposit into the Local
19Government Aviation Trust Fund. The Department shall only pay
20moneys into the Local Government Aviation Trust Fund under
21this Section for so long as the revenue use requirements of 49
22U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the
23municipality.
24    As soon as possible after the first day of each month,
25beginning January 1, 2011, upon certification of the
26Department of Revenue, the Comptroller shall order

 

 

HB3880- 28 -LRB102 02597 AWJ 12600 b

1transferred, and the Treasurer shall transfer, to the STAR
2Bonds Revenue Fund the local sales tax increment, as defined
3in the Innovation Development and Economy Act, collected under
4this Section during the second preceding calendar month for
5sales within a STAR bond district.
6    After the monthly transfer to the STAR Bonds Revenue Fund,
7on or before the 25th day of each calendar month, the
8Department shall prepare and certify to the Comptroller the
9disbursement of stated sums of money to named municipalities,
10the municipalities to be those from which retailers have paid
11taxes or penalties hereunder to the Department during the
12second preceding calendar month. The amount to be paid to each
13municipality shall be the amount (not including credit
14memoranda and not including taxes and penalties collected on
15aviation fuel sold on or after December 1, 2019) collected
16hereunder during the second preceding calendar month by the
17Department plus an amount the Department determines is
18necessary to offset any amounts that were erroneously paid to
19a different taxing body, and not including an amount equal to
20the amount of refunds made during the second preceding
21calendar month by the Department on behalf of the
22municipality, and not including any amount that the Department
23determines is necessary to offset any amounts that were
24payable to a different taxing body but were erroneously paid
25to the municipality, and not including any amounts that are
26transferred to the STAR Bonds Revenue Fund, less 1.5% of the

 

 

HB3880- 29 -LRB102 02597 AWJ 12600 b

1remainder, which the Department shall transfer into the Tax
2Compliance and Administration Fund. The Department, at the
3time of each monthly disbursement to the municipalities, shall
4prepare and certify to the State Comptroller the amount to be
5transferred into the Tax Compliance and Administration Fund
6under this Section. Within 10 days after receipt by the
7Comptroller of the disbursement certification to the
8municipalities and the Tax Compliance and Administration Fund
9provided for in this Section to be given to the Comptroller by
10the Department, the Comptroller shall cause the orders to be
11drawn for the respective amounts in accordance with the
12directions contained in the certification.
13    For the purpose of determining the local governmental unit
14whose tax is applicable, a retail sale by a producer of coal or
15other mineral mined in Illinois is a sale at retail at the
16place where the coal or other mineral mined in Illinois is
17extracted from the earth. This paragraph does not apply to
18coal or other mineral when it is delivered or shipped by the
19seller to the purchaser at a point outside Illinois so that the
20sale is exempt under the federal Constitution as a sale in
21interstate or foreign commerce.
22    Nothing in this Section shall be construed to authorize a
23municipality to impose a tax upon the privilege of engaging in
24any business which under the constitution of the United States
25may not be made the subject of taxation by this State.
26    When certifying the amount of a monthly disbursement to a

 

 

HB3880- 30 -LRB102 02597 AWJ 12600 b

1municipality under this Section, the Department shall increase
2or decrease the amount by an amount necessary to offset any
3misallocation of previous disbursements. The offset amount
4shall be the amount erroneously disbursed within the previous
56 months from the time a misallocation is discovered.
6    As used in this Section, "municipal" and "municipality"
7means a city, village, or incorporated town, including an
8incorporated town that has superseded a civil township.
9(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
10100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; 101-10, eff.
116-5-19; 101-81, eff. 7-12-19; 101-604, eff. 12-13-19.)
 
12    (65 ILCS 5/8-11-1.7)
13    Sec. 8-11-1.7. Non-home rule municipal service occupation
14tax; municipalities between 20,000 and 25,000. The corporate
15authorities of a non-home rule municipality with a population
16of more than 20,000 but less than 25,000 as determined by the
17last preceding decennial census that has, prior to January 1,
181987, established a Redevelopment Project Area that has been
19certified as a State Sales Tax Boundary and has issued bonds or
20otherwise incurred indebtedness to pay for costs in excess of
21$5,000,000, which is secured in part by a tax increment
22allocation fund, in accordance with the provisions of Division
2311-74.4 of this Code may, by passage of an ordinance, impose a
24tax upon all persons engaged in the municipality in the
25business of making sales of service. If imposed, the tax shall

 

 

HB3880- 31 -LRB102 02597 AWJ 12600 b

1only be imposed in .25% increments of the selling price of all
2tangible personal property transferred by such servicemen
3either in the form of tangible personal property or in the form
4of real estate as an incident to a sale of service. This tax
5may not be imposed on tangible personal property taxed at the
61% rate under the Service Occupation Tax Act. Beginning
7December 1, 2019, this tax is not imposed on sales of aviation
8fuel unless the tax revenue is expended for airport-related
9purposes. If a municipality does not have an airport-related
10purpose to which it dedicates aviation fuel tax revenue, then
11aviation fuel is excluded from the tax. Each municipality must
12comply with the certification requirements for airport-related
13purposes under Section 2-22 of the Retailers' Occupation Tax
14Act. For purposes of this Section, "airport-related purposes"
15has the meaning ascribed in Section 6z-20.2 of the State
16Finance Act. This exclusion for aviation fuel only applies for
17so long as the revenue use requirements of 49 U.S.C. 47107(b)
18and 49 U.S.C. 47133 are binding on the municipality. The tax
19imposed by a municipality under this Section and all civil
20penalties that may be assessed as an incident thereof shall be
21collected and enforced by the State Department of Revenue,
22except that a municipality may, by ordinance, provide that the
23tax shall be collected and enforced by the municipality. If
24the tax is collected and enforced by the municipality, none of
25the proceeds collected from the tax shall be transferred into
26the Tax Compliance and Administration Fund. An ordinance

 

 

HB3880- 32 -LRB102 02597 AWJ 12600 b

1imposing a tax hereunder or effecting a change in the rate
2thereof shall be adopted and a certified copy thereof filed
3with the Department on or before the first day of October,
4whereupon the Department shall proceed to administer and
5enforce this Section as of the first day of January next
6following such adoption and filing. The certificate of
7registration that is issued by the Department to a retailer
8under the Retailers' Occupation Tax Act or under the Service
9Occupation Tax Act shall permit the registrant to engage in a
10business that is taxable under any ordinance or resolution
11enacted under this Section without registering separately with
12the Department under the ordinance or resolution or under this
13Section. The Department shall have full power to administer
14and enforce this Section, to collect all taxes and penalties
15due hereunder, to dispose of taxes and penalties so collected
16in a manner hereinafter provided, and to determine all rights
17to credit memoranda arising on account of the erroneous
18payment of tax or penalty hereunder. In the administration of
19and compliance with this Section, the Department and persons
20who are subject to this Section shall have the same rights,
21remedies, privileges, immunities, powers, and duties, and be
22subject to the same conditions, restrictions, limitations,
23penalties and definitions of terms, and employ the same modes
24of procedure, as are prescribed in Sections 1a-1, 2, 2a, 3
25through 3-50 (in respect to all provisions therein other than
26the State rate of tax), 4 (except that the reference to the

 

 

HB3880- 33 -LRB102 02597 AWJ 12600 b

1State shall be to the taxing municipality), 5, 7, 8 (except
2that the jurisdiction to which the tax shall be a debt to the
3extent indicated in that Section 8 shall be the taxing
4municipality), 9 (except as to the disposition of taxes and
5penalties collected, and except that the returned merchandise
6credit for this municipal tax may not be taken against any
7State tax, and except that the retailer's discount is not
8allowed for taxes paid on aviation fuel that are subject to the
9revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C.
1047133), 10, 11, 12, (except the reference therein to Section
112b of the Retailers' Occupation Tax Act), 13 (except that any
12reference to the State shall mean the taxing municipality),
13the first paragraph of Sections 15, 16, 17, 18, 19, and 20 of
14the Service Occupation Tax Act and Section 3-7 of the Uniform
15Penalty and Interest Act, as fully as if those provisions were
16set forth herein.
17    A tax may not be imposed by a municipality under this
18Section unless the municipality also imposes a tax at the same
19rate under Section 8-11-1.6 of this Act.
20    Person subject to any tax imposed under the authority
21granted in this Section may reimburse themselves for their
22servicemen's tax liability hereunder by separately stating the
23tax as an additional charge, which charge may be stated in
24combination, in a single amount, with State tax that
25servicemen are authorized to collect under the Service Use Tax
26Act, under such bracket schedules as the Department may

 

 

HB3880- 34 -LRB102 02597 AWJ 12600 b

1prescribe.
2    Whenever the Department determines that a refund should be
3made under this Section to a claimant instead of issuing
4credit memorandum, the Department shall notify the State
5Comptroller, who shall cause the order to be drawn for the
6amount specified, and to the person named, in such
7notification from the Department. The refund shall be paid by
8the State Treasurer out of the Non-Home Rule Municipal
9Retailers' Occupation Tax Fund or the Local Government
10Aviation Trust Fund, as appropriate.
11    Except as otherwise provided in this paragraph, the
12Department shall forthwith pay over to the State Treasurer, ex
13officio, as trustee, all taxes and penalties collected
14hereunder for deposit into the Non-Home Rule Municipal
15Retailers' Occupation Tax Fund. Taxes and penalties collected
16on aviation fuel sold on or after December 1, 2019, shall be
17immediately paid over by the Department to the State
18Treasurer, ex officio, as trustee, for deposit into the Local
19Government Aviation Trust Fund. The Department shall only pay
20moneys into the Local Government Aviation Trust Fund under
21this Section for so long as the revenue use requirements of 49
22U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the
23Municipality.
24    As soon as possible after the first day of each month,
25beginning January 1, 2011, upon certification of the
26Department of Revenue, the Comptroller shall order

 

 

HB3880- 35 -LRB102 02597 AWJ 12600 b

1transferred, and the Treasurer shall transfer, to the STAR
2Bonds Revenue Fund the local sales tax increment, as defined
3in the Innovation Development and Economy Act, collected under
4this Section during the second preceding calendar month for
5sales within a STAR bond district.
6    After the monthly transfer to the STAR Bonds Revenue Fund,
7on or before the 25th day of each calendar month, the
8Department shall prepare and certify to the Comptroller the
9disbursement of stated sums of money to named municipalities,
10the municipalities to be those from which suppliers and
11servicemen have paid taxes or penalties hereunder to the
12Department during the second preceding calendar month. The
13amount to be paid to each municipality shall be the amount (not
14including credit memoranda and not including taxes and
15penalties collected on aviation fuel sold on or after December
161, 2019) collected hereunder during the second preceding
17calendar month by the Department, and not including an amount
18equal to the amount of refunds made during the second
19preceding calendar month by the Department on behalf of such
20municipality, and not including any amounts that are
21transferred to the STAR Bonds Revenue Fund, less 1.5% of the
22remainder, which the Department shall transfer into the Tax
23Compliance and Administration Fund. The Department, at the
24time of each monthly disbursement to the municipalities, shall
25prepare and certify to the State Comptroller the amount to be
26transferred into the Tax Compliance and Administration Fund

 

 

HB3880- 36 -LRB102 02597 AWJ 12600 b

1under this Section. Within 10 days after receipt by the
2Comptroller of the disbursement certification to the
3municipalities, the Tax Compliance and Administration Fund,
4and the General Revenue Fund, provided for in this Section to
5be given to the Comptroller by the Department, the Comptroller
6shall cause the orders to be drawn for the respective amounts
7in accordance with the directions contained in the
8certification.
9    When certifying the amount of a monthly disbursement to a
10municipality under this Section, the Department shall increase
11or decrease the amount by an amount necessary to offset any
12misallocation of previous disbursements. The offset amount
13shall be the amount erroneously disbursed within the previous
146 months from the time a misallocation is discovered.
15    Nothing in this Section shall be construed to authorize a
16municipality to impose a tax upon the privilege of engaging in
17any business which under the constitution of the United States
18may not be made the subject of taxation by this State.
19(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
20100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; 101-10, eff.
216-5-19; 101-81, eff. 7-12-19; 101-604, eff. 12-13-19.)
 
22    (65 ILCS 5/8-11-5)  (from Ch. 24, par. 8-11-5)
23    Sec. 8-11-5. Home Rule Municipal Service Occupation Tax
24Act. The corporate authorities of a home rule municipality may
25impose a tax upon all persons engaged, in such municipality,

 

 

HB3880- 37 -LRB102 02597 AWJ 12600 b

1in the business of making sales of service at the same rate of
2tax imposed pursuant to Section 8-11-1, of the selling price
3of all tangible personal property transferred by such
4servicemen either in the form of tangible personal property or
5in the form of real estate as an incident to a sale of service.
6If imposed, such tax shall only be imposed in 1/4% increments.
7On and after September 1, 1991, this additional tax may not be
8imposed on tangible personal property taxed at the 1% rate
9under the Retailers' Occupation Tax Act. Beginning December 1,
102019, this tax may not be imposed on sales of aviation fuel
11unless the tax revenue is expended for airport-related
12purposes. If a municipality does not have an airport-related
13purpose to which it dedicates aviation fuel tax revenue, then
14aviation fuel shall be excluded from tax. Each municipality
15must comply with the certification requirements for
16airport-related purposes under Section 2-22 of the Retailers'
17Occupation Tax Act. For purposes of this Section,
18"airport-related purposes" has the meaning ascribed in Section
196z-20.2 of the State Finance Act. This exception for aviation
20fuel only applies for so long as the revenue use requirements
21of 49 U.S.C. 47107(b) and 49 U.S.C. 47133 are binding on the
22State. The changes made to this Section by this amendatory Act
23of the 101st General Assembly are a denial and limitation of
24home rule powers and functions under subsection (g) of Section
256 of Article VII of the Illinois Constitution. The tax imposed
26by a home rule municipality pursuant to this Section and all

 

 

HB3880- 38 -LRB102 02597 AWJ 12600 b

1civil penalties that may be assessed as an incident thereof
2shall be collected and enforced by the State Department of
3Revenue, except that a municipality may, by ordinance, provide
4that the tax shall be collected and enforced by the
5municipality. If the tax is collected and enforced by the
6municipality, none of the proceeds collected from the tax
7shall be transferred into the Tax Compliance and
8Administration Fund. The certificate of registration which is
9issued by the Department to a retailer under the Retailers'
10Occupation Tax Act or under the Service Occupation Tax Act
11shall permit such registrant to engage in a business which is
12taxable under any ordinance or resolution enacted pursuant to
13this Section without registering separately with the
14Department under such ordinance or resolution or under this
15Section. The Department shall have full power to administer
16and enforce this Section; to collect all taxes and penalties
17due hereunder; to dispose of taxes and penalties so collected
18in the manner hereinafter provided, and to determine all
19rights to credit memoranda arising on account of the erroneous
20payment of tax or penalty hereunder. In the administration of,
21and compliance with, this Section the Department and persons
22who are subject to this Section shall have the same rights,
23remedies, privileges, immunities, powers and duties, and be
24subject to the same conditions, restrictions, limitations,
25penalties and definitions of terms, and employ the same modes
26of procedure, as are prescribed in Sections 1a-1, 2, 2a, 3

 

 

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1through 3-50 (in respect to all provisions therein other than
2the State rate of tax), 4 (except that the reference to the
3State shall be to the taxing municipality), 5, 7, 8 (except
4that the jurisdiction to which the tax shall be a debt to the
5extent indicated in that Section 8 shall be the taxing
6municipality), 9 (except as to the disposition of taxes and
7penalties collected, and except that the returned merchandise
8credit for this municipal tax may not be taken against any
9State tax, and except that the retailer's discount is not
10allowed for taxes paid on aviation fuel that are subject to the
11revenue use requirements of 49 U.S.C. 47107(b) and 49 U.S.C.
1247133), 10, 11, 12 (except the reference therein to Section 2b
13of the Retailers' Occupation Tax Act), 13 (except that any
14reference to the State shall mean the taxing municipality),
15the first paragraph of Section 15, 16, 17 (except that credit
16memoranda issued hereunder may not be used to discharge any
17State tax liability), 18, 19 and 20 of the Service Occupation
18Tax Act and Section 3-7 of the Uniform Penalty and Interest
19Act, as fully as if those provisions were set forth herein.
20    No tax may be imposed by a home rule municipality pursuant
21to this Section unless such municipality also imposes a tax at
22the same rate pursuant to Section 8-11-1 of this Act.
23    Persons subject to any tax imposed pursuant to the
24authority granted in this Section may reimburse themselves for
25their serviceman's tax liability hereunder by separately
26stating such tax as an additional charge, which charge may be

 

 

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1stated in combination, in a single amount, with State tax
2which servicemen are authorized to collect under the Service
3Use Tax Act, pursuant to such bracket schedules as the
4Department may prescribe.
5    Whenever the Department determines that a refund should be
6made under this Section to a claimant instead of issuing
7credit memorandum, the Department shall notify the State
8Comptroller, who shall cause the order to be drawn for the
9amount specified, and to the person named, in such
10notification from the Department. Such refund shall be paid by
11the State Treasurer out of the home rule municipal retailers'
12occupation tax fund or the Local Government Aviation Trust
13Fund, as appropriate.
14    Except as otherwise provided in this paragraph, the
15Department shall forthwith pay over to the State Treasurer, ex
16officio, as trustee, all taxes and penalties collected
17hereunder for deposit into the Home Rule Municipal Retailers'
18Occupation Tax Fund. Taxes and penalties collected on aviation
19fuel sold on or after December 1, 2019, shall be immediately
20paid over by the Department to the State Treasurer, ex
21officio, as trustee, for deposit into the Local Government
22Aviation Trust Fund. The Department shall only pay moneys into
23the Local Government Aviation Trust Fund under this Section
24for so long as the revenue use requirements of 49 U.S.C.
2547107(b) and 49 U.S.C. 47133 are binding on the municipality.
26    As soon as possible after the first day of each month,

 

 

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1beginning January 1, 2011, upon certification of the
2Department of Revenue, the Comptroller shall order
3transferred, and the Treasurer shall transfer, to the STAR
4Bonds Revenue Fund the local sales tax increment, as defined
5in the Innovation Development and Economy Act, collected under
6this Section during the second preceding calendar month for
7sales within a STAR bond district.
8    After the monthly transfer to the STAR Bonds Revenue Fund,
9on or before the 25th day of each calendar month, the
10Department shall prepare and certify to the Comptroller the
11disbursement of stated sums of money to named municipalities,
12the municipalities to be those from which suppliers and
13servicemen have paid taxes or penalties hereunder to the
14Department during the second preceding calendar month. The
15amount to be paid to each municipality shall be the amount (not
16including credit memoranda and not including taxes and
17penalties collected on aviation fuel sold on or after December
181, 2019) collected hereunder during the second preceding
19calendar month by the Department, and not including an amount
20equal to the amount of refunds made during the second
21preceding calendar month by the Department on behalf of such
22municipality, and not including any amounts that are
23transferred to the STAR Bonds Revenue Fund, less 1.5% of the
24remainder, which the Department shall transfer into the Tax
25Compliance and Administration Fund. The Department, at the
26time of each monthly disbursement to the municipalities, shall

 

 

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1prepare and certify to the State Comptroller the amount to be
2transferred into the Tax Compliance and Administration Fund
3under this Section. Within 10 days after receipt, by the
4Comptroller, of the disbursement certification to the
5municipalities and the Tax Compliance and Administration Fund
6provided for in this Section to be given to the Comptroller by
7the Department, the Comptroller shall cause the orders to be
8drawn for the respective amounts in accordance with the
9directions contained in such certification.
10    In addition to the disbursement required by the preceding
11paragraph and in order to mitigate delays caused by
12distribution procedures, an allocation shall, if requested, be
13made within 10 days after January 14, 1991, and in November of
141991 and each year thereafter, to each municipality that
15received more than $500,000 during the preceding fiscal year,
16(July 1 through June 30) whether collected by the municipality
17or disbursed by the Department as required by this Section.
18Within 10 days after January 14, 1991, participating
19municipalities shall notify the Department in writing of their
20intent to participate. In addition, for the initial
21distribution, participating municipalities shall certify to
22the Department the amounts collected by the municipality for
23each month under its home rule occupation and service
24occupation tax during the period July 1, 1989 through June 30,
251990. The allocation within 10 days after January 14, 1991,
26shall be in an amount equal to the monthly average of these

 

 

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1amounts, excluding the 2 months of highest receipts. Monthly
2average for the period of July 1, 1990 through June 30, 1991
3will be determined as follows: the amounts collected by the
4municipality under its home rule occupation and service
5occupation tax during the period of July 1, 1990 through
6September 30, 1990, plus amounts collected by the Department
7and paid to such municipality through June 30, 1991, excluding
8the 2 months of highest receipts. The monthly average for each
9subsequent period of July 1 through June 30 shall be an amount
10equal to the monthly distribution made to each such
11municipality under the preceding paragraph during this period,
12excluding the 2 months of highest receipts. The distribution
13made in November 1991 and each year thereafter under this
14paragraph and the preceding paragraph shall be reduced by the
15amount allocated and disbursed under this paragraph in the
16preceding period of July 1 through June 30. The Department
17shall prepare and certify to the Comptroller for disbursement
18the allocations made in accordance with this paragraph.
19    Nothing in this Section shall be construed to authorize a
20municipality to impose a tax upon the privilege of engaging in
21any business which under the constitution of the United States
22may not be made the subject of taxation by this State.
23    An ordinance or resolution imposing or discontinuing a tax
24hereunder or effecting a change in the rate thereof shall be
25adopted and a certified copy thereof filed with the Department
26on or before the first day of June, whereupon the Department

 

 

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1shall proceed to administer and enforce this Section as of the
2first day of September next following such adoption and
3filing. Beginning January 1, 1992, an ordinance or resolution
4imposing or discontinuing the tax hereunder or effecting a
5change in the rate thereof shall be adopted and a certified
6copy thereof filed with the Department on or before the first
7day of July, whereupon the Department shall proceed to
8administer and enforce this Section as of the first day of
9October next following such adoption and filing. Beginning
10January 1, 1993, an ordinance or resolution imposing or
11discontinuing the tax hereunder or effecting a change in the
12rate thereof shall be adopted and a certified copy thereof
13filed with the Department on or before the first day of
14October, whereupon the Department shall proceed to administer
15and enforce this Section as of the first day of January next
16following such adoption and filing. However, a municipality
17located in a county with a population in excess of 3,000,000
18that elected to become a home rule unit at the general primary
19election in 1994 may adopt an ordinance or resolution imposing
20the tax under this Section and file a certified copy of the
21ordinance or resolution with the Department on or before July
221, 1994. The Department shall then proceed to administer and
23enforce this Section as of October 1, 1994. Beginning April 1,
241998, an ordinance or resolution imposing or discontinuing the
25tax hereunder or effecting a change in the rate thereof shall
26either (i) be adopted and a certified copy thereof filed with

 

 

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1the Department on or before the first day of April, whereupon
2the Department shall proceed to administer and enforce this
3Section as of the first day of July next following the adoption
4and filing; or (ii) be adopted and a certified copy thereof
5filed with the Department on or before the first day of
6October, whereupon the Department shall proceed to administer
7and enforce this Section as of the first day of January next
8following the adoption and filing.
9    Any unobligated balance remaining in the Municipal
10Retailers' Occupation Tax Fund on December 31, 1989, which
11fund was abolished by Public Act 85-1135, and all receipts of
12municipal tax as a result of audits of liability periods prior
13to January 1, 1990, shall be paid into the Local Government Tax
14Fund, for distribution as provided by this Section prior to
15the enactment of Public Act 85-1135. All receipts of municipal
16tax as a result of an assessment not arising from an audit, for
17liability periods prior to January 1, 1990, shall be paid into
18the Local Government Tax Fund for distribution before July 1,
191990, as provided by this Section prior to the enactment of
20Public Act 85-1135, and on and after July 1, 1990, all such
21receipts shall be distributed as provided in Section 6z-18 of
22the State Finance Act.
23    As used in this Section, "municipal" and "municipality"
24means a city, village or incorporated town, including an
25incorporated town which has superseded a civil township.
26    This Section shall be known and may be cited as the Home

 

 

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1Rule Municipal Service Occupation Tax Act.
2(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
3100-1171, eff. 1-4-19; 101-10, eff. 6-5-19; 101-81, eff.
47-12-19; 101-604, eff. 12-13-19.)
 
5    (65 ILCS 5/8-11-6)  (from Ch. 24, par. 8-11-6)
6    Sec. 8-11-6. Home Rule Municipal Use Tax Act.
7    (a) The corporate authorities of a home rule municipality
8may impose a tax upon the privilege of using, in such
9municipality, any item of tangible personal property which is
10purchased at retail from a retailer, and which is titled or
11registered at a location within the corporate limits of such
12home rule municipality with an agency of this State's
13government, at a rate which is an increment of 1/4% and based
14on the selling price of such tangible personal property, as
15"selling price" is defined in the Use Tax Act. In home rule
16municipalities with less than 2,000,000 inhabitants, the tax
17shall be collected by the municipality imposing the tax from
18persons whose Illinois address for titling or registration
19purposes is given as being in such municipality.
20    (b) In home rule municipalities with 2,000,000 or more
21inhabitants, the corporate authorities of the municipality may
22additionally impose a tax beginning July 1, 1991 upon the
23privilege of using in the municipality, any item of tangible
24personal property, other than tangible personal property
25titled or registered with an agency of the State's government,

 

 

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1that is purchased at retail from a retailer located outside
2the corporate limits of the municipality, at a rate that is an
3increment of 1/4% not to exceed 1% and based on the selling
4price of the tangible personal property, as "selling price" is
5defined in the Use Tax Act. Such tax shall be collected from
6the purchaser either by the municipality imposing such tax or
7by the Department of Revenue pursuant to an agreement between
8the Department and the municipality. If the tax is collected
9and enforced by the municipality, none of the proceeds
10collected from the tax shall be transferred into the Tax
11Compliance and Administration Fund.
12    To prevent multiple home rule taxation, the use in a home
13rule municipality of tangible personal property that is
14acquired outside the municipality and caused to be brought
15into the municipality by a person who has already paid a home
16rule municipal tax in another municipality in respect to the
17sale, purchase, or use of that property, shall be exempt to the
18extent of the amount of the tax properly due and paid in the
19other home rule municipality.
20    (c) If a municipality having 2,000,000 or more inhabitants
21imposes the tax authorized by subsection (a), then the tax
22shall be collected by the Illinois Department of Revenue when
23the property is purchased at retail from a retailer in the
24county in which the home rule municipality imposing the tax is
25located, and in all contiguous counties. The tax shall be
26remitted to the State, or an exemption determination must be

 

 

HB3880- 48 -LRB102 02597 AWJ 12600 b

1obtained from the Department before the title or certificate
2of registration for the property may be issued. The tax or
3proof of exemption may be transmitted to the Department by way
4of the State agency with which, or State officer with whom, the
5tangible personal property must be titled or registered if the
6Department and that agency or State officer determine that
7this procedure will expedite the processing of applications
8for title or registration.
9    The Department shall have full power to administer and
10enforce this Section to collect all taxes, penalties and
11interest due hereunder, to dispose of taxes, penalties and
12interest so collected in the manner hereinafter provided, and
13determine all rights to credit memoranda or refunds arising on
14account of the erroneous payment of tax, penalty or interest
15hereunder. In the administration of and compliance with this
16Section the Department and persons who are subject to this
17Section shall have the same rights, remedies, privileges,
18immunities, powers and duties, and be subject to the same
19conditions, restrictions, limitations, penalties and
20definitions of terms, and employ the same modes of procedure
21as are prescribed in Sections 2 (except the definition of
22"retailer maintaining a place of business in this State"), 3
23(except provisions pertaining to the State rate of tax, and
24except provisions concerning collection or refunding of the
25tax by retailers), 4, 11, 12, 12a, 14, 15, 19, 20, 21 and 22 of
26the Use Tax Act, which are not inconsistent with this Section,

 

 

HB3880- 49 -LRB102 02597 AWJ 12600 b

1as fully as if provisions contained in those Sections of the
2Use Tax Act were set forth herein.
3    Whenever the Department determines that a refund shall be
4made under this Section to a claimant instead of issuing a
5credit memorandum, the Department shall notify the State
6Comptroller, who shall cause the order to be drawn for the
7amount specified, and to the person named, in such
8notification from the Department. Such refund shall be paid by
9the State Treasurer out of the home rule municipal retailers'
10occupation tax fund.
11    The Department shall forthwith pay over to the State
12Treasurer, ex officio, as trustee, all taxes, penalties and
13interest collected hereunder. On or before the 25th day of
14each calendar month, the Department shall prepare and certify
15to the State Comptroller the disbursement of stated sums of
16money to named municipalities, the municipality in each
17instance to be that municipality from which the Department
18during the second preceding calendar month, collected
19municipal use tax from any person whose Illinois address for
20titling or registration purposes is given as being in such
21municipality. The amount to be paid to each municipality shall
22be the amount (not including credit memoranda) collected
23hereunder during the second preceding calendar month by the
24Department, and not including an amount equal to the amount of
25refunds made during the second preceding calendar month by the
26Department on behalf of such municipality, less 2% of the

 

 

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1balance, which sum shall be retained by the State Treasurer to
2cover the costs incurred by the Department in administering
3and enforcing the provisions of this Section. The Department,
4at the time of each monthly disbursement to the
5municipalities, shall prepare and certify to the Comptroller
6the amount so retained by the State Treasurer, which shall be
7transferred into the Tax Compliance and Administration Fund.
8Within 10 days after receipt by the State Comptroller of the
9disbursement certification to the municipalities provided for
10in this Section to be given to the State Comptroller by the
11Department, the State Comptroller shall cause the orders to be
12drawn for the respective amounts in accordance with the
13directions contained in that certification.
14    Any ordinance imposing or discontinuing any tax to be
15collected and enforced by the Department under this Section
16shall be adopted and a certified copy thereof filed with the
17Department on or before October 1, whereupon the Department of
18Revenue shall proceed to administer and enforce this Section
19on behalf of the municipalities as of January 1 next following
20such adoption and filing. Beginning April 1, 1998, any
21ordinance imposing or discontinuing any tax to be collected
22and enforced by the Department under this Section shall either
23(i) be adopted and a certified copy thereof filed with the
24Department on or before April 1, whereupon the Department of
25Revenue shall proceed to administer and enforce this Section
26on behalf of the municipalities as of July 1 next following the

 

 

HB3880- 51 -LRB102 02597 AWJ 12600 b

1adoption and filing; or (ii) be adopted and a certified copy
2thereof filed with the Department on or before October 1,
3whereupon the Department of Revenue shall proceed to
4administer and enforce this Section on behalf of the
5municipalities as of January 1 next following the adoption and
6filing.
7    Nothing in this subsection (c) shall prevent a home rule
8municipality from collecting the tax pursuant to subsection
9(a) in any situation where such tax is not collected by the
10Department of Revenue under this subsection (c).
11    (d) Any unobligated balance remaining in the Municipal
12Retailers' Occupation Tax Fund on December 31, 1989, which
13fund was abolished by Public Act 85-1135, and all receipts of
14municipal tax as a result of audits of liability periods prior
15to January 1, 1990, shall be paid into the Local Government Tax
16Fund, for distribution as provided by this Section prior to
17the enactment of Public Act 85-1135. All receipts of municipal
18tax as a result of an assessment not arising from an audit, for
19liability periods prior to January 1, 1990, shall be paid into
20the Local Government Tax Fund for distribution before July 1,
211990, as provided by this Section prior to the enactment of
22Public Act 85-1135, and on and after July 1, 1990, all such
23receipts shall be distributed as provided in Section 6z-18 of
24the State Finance Act.
25    (e) As used in this Section, "Municipal" and
26"Municipality" means a city, village or incorporated town,

 

 

HB3880- 52 -LRB102 02597 AWJ 12600 b

1including an incorporated town which has superseded a civil
2township.
3    (f) This Section shall be known and may be cited as the
4Home Rule Municipal Use Tax Act.
5(Source: P.A. 98-1049, eff. 8-25-14.)
 
6    Section 99. Effective date. This Act takes effect upon
7becoming law.