102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB5040

 

Introduced 1/27/2022, by Rep. Dave Severin

 

SYNOPSIS AS INTRODUCED:
 
See Index

    Amends the Department of Revenue Law of the Civil Administrative Code of Illinois. Provides that if an in-State retailer or serviceman bids on a purchase order or contract to provide materials, equipment, or supplies to a municipality with a population under 1,000,000, and that purchase order or contract involves an amount in excess of $25,000, then the municipality may apply to the Department of Revenue for a certificate of exemption from the taxes imposed under specified local provisions of the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act for the in-State retailer or serviceman, or a third-party supplier of the retailer or serviceman, with respect to the materials, equipment, or supplies covered by the bid if: at least one other bid is received from an out-of-State retailer or serviceman; the in-State retailer or serviceman demonstrates the necessity of the exemption in order to submit the lowest responsible bid, including substantive proof furnished by the retailer or serviceman to the municipality or the Department of Revenue; and the in-State retailer provides an itemized estimate of cost to the corporate authorities of the municipality. Defines terms. Makes confirming changes in the following Acts and Codes: the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, the Counties Code, the Illinois Municipal Code, the Salem Civic Center Law of 1997 of the Civic Center Code, the Metropolitan Pier and Exposition Authority Act, the Flood Prevention District Act, the Metro-East Park and Recreation District Act, the Local Mass Transit District Act, the Regional Transportation Authority Act, and the Water Commission Act of 1985. Effective immediately.


LRB102 23725 HLH 32914 b

 

 

A BILL FOR

 

HB5040LRB102 23725 HLH 32914 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 Department of Revenue Law of the Civil
5Administrative Code of Illinois is amended by adding Section
62505-805 as follows:
 
7    (20 ILCS 2505/2505-805 new)
8    Sec. 2505-805. Exemption for materials, equipment, or
9supplies of a bid.
10    (a) As used in this Section:
11    "In-State retailer or serviceman" means a retailer or
12serviceman with a principal place of business located in the
13State.
14    "Local provisions of the Use Tax Act, the Service Use Tax
15Act, the Service Occupation Tax Act, and the Retailers'
16Occupation Tax Act" means use taxes or occupation taxes
17imposed under the Counties Code, the Illinois Municipal Code,
18the Salem Civic Center Law of 1997 of the Civic Center Code,
19the Metropolitan Pier and Exposition Authority Act, the Flood
20Prevention District Act, the Metro-East Park and Recreation
21District Act, the Local Mass Transit District Act, the
22Regional Transportation Authority Act, and the Water
23Commission Act of 1985.

 

 

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1    "Out-of-State retailer or serviceman" means a retailer or
2serviceman with a principal place of business located outside
3of the State.
4    (b) If an in-State retailer or serviceman bids on a
5purchase order or contract to provide materials, equipment, or
6supplies to a municipality with a population of less than
71,000,000, and that purchase order or contract involves an
8amount in excess of $25,000, then the municipality may apply
9to the Department of Revenue for a certificate of exemption
10from the taxes imposed under local provisions of the Use Tax
11Act, the Service Use Tax Act, the Service Occupation Tax Act,
12and the Retailers' Occupation Tax Act for the in-State
13retailer or serviceman, or a third-party supplier of the
14in-State retailer or serviceman, with respect to the
15materials, equipment, or supplies covered by the bid if all of
16the following conditions apply:
17        (1) at least one other bid is received from an
18    out-of-State retailer or serviceman;
19        (2) the in-State retailer or serviceman demonstrates
20    the necessity of the exemption in order to submit the
21    lowest responsible bid under the guidelines provided under
22    Division 9 or 10 of Article 8 of the Illinois Municipal
23    Code, including substantive proof furnished by the
24    retailer or serviceman to the municipality or the
25    Department of Revenue; and
26        (3) the in-State retailer provides an itemized

 

 

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1    estimate of cost to the corporate authorities of the
2    municipality.
 
3    Section 10. The Use Tax Act is amended by changing Section
43-5 as follows:
 
5    (35 ILCS 105/3-5)
6    Sec. 3-5. Exemptions. Use of the following tangible
7personal property is exempt from the tax imposed by this Act:
8    (1) Personal property purchased from a corporation,
9society, association, foundation, institution, or
10organization, other than a limited liability company, that is
11organized and operated as a not-for-profit service enterprise
12for the benefit of persons 65 years of age or older if the
13personal property was not purchased by the enterprise for the
14purpose of resale by the enterprise.
15    (2) Personal property purchased by a not-for-profit
16Illinois county fair association for use in conducting,
17operating, or promoting the county fair.
18    (3) Personal property purchased by a not-for-profit arts
19or cultural organization that establishes, by proof required
20by the Department by rule, that it has received an exemption
21under Section 501(c)(3) of the Internal Revenue Code and that
22is organized and operated primarily for the presentation or
23support of arts or cultural programming, activities, or
24services. 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 July 1, 2001 (the
5effective date of Public Act 92-35), however, an entity
6otherwise eligible for this exemption shall not make tax-free
7purchases unless it has an active identification number issued
8by the Department.
9    (4) Personal property purchased by a governmental body, by
10a corporation, society, association, foundation, or
11institution organized and operated exclusively for charitable,
12religious, or educational purposes, or by a not-for-profit
13corporation, society, association, foundation, institution, or
14organization that has no compensated officers or employees and
15that is organized and operated primarily for the recreation of
16persons 55 years of age or older. A limited liability company
17may qualify for the exemption under this paragraph only if the
18limited liability company is organized and operated
19exclusively for educational purposes. On and after July 1,
201987, however, no entity otherwise eligible for this exemption
21shall make tax-free purchases unless it has an active
22exemption identification number issued by the Department.
23    (5) Until July 1, 2003, a passenger car that is a
24replacement vehicle to the extent that the purchase price of
25the car is subject to the Replacement Vehicle Tax.
26    (6) Until July 1, 2003 and beginning again on September 1,

 

 

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12004 through August 30, 2014, graphic arts machinery and
2equipment, including repair and replacement parts, both new
3and used, and including that manufactured on special order,
4certified by the purchaser to be used primarily for graphic
5arts production, and including machinery and equipment
6purchased for lease. Equipment includes chemicals or chemicals
7acting as catalysts but only if the chemicals or chemicals
8acting as catalysts effect a direct and immediate change upon
9a graphic arts product. Beginning on July 1, 2017, graphic
10arts machinery and equipment is included in the manufacturing
11and assembling machinery and equipment exemption under
12paragraph (18).
13    (7) Farm chemicals.
14    (8) Legal tender, currency, medallions, or gold or silver
15coinage issued by the State of Illinois, the government of the
16United States of America, or the government of any foreign
17country, and bullion.
18    (9) Personal property purchased from a teacher-sponsored
19student organization affiliated with an elementary or
20secondary school located in Illinois.
21    (10) A motor vehicle that is used for automobile renting,
22as defined in the Automobile Renting Occupation and Use Tax
23Act.
24    (11) Farm machinery and equipment, both new and used,
25including that manufactured on special order, certified by the
26purchaser to be used primarily for production agriculture or

 

 

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

 

 

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

 

 

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1extent that the proceeds of the service charge are in fact
2turned over as tips or as a substitute for tips to the
3employees who participate directly in preparing, serving,
4hosting or cleaning up the food or beverage function with
5respect to which the service charge is imposed.
6    (14) Until July 1, 2003, oil field exploration, drilling,
7and production equipment, including (i) rigs and parts of
8rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
9pipe and tubular goods, including casing and drill strings,
10(iii) pumps and pump-jack units, (iv) storage tanks and flow
11lines, (v) any individual replacement part for oil field
12exploration, drilling, and production equipment, and (vi)
13machinery and equipment purchased for lease; but excluding
14motor vehicles required to be registered under the Illinois
15Vehicle Code.
16    (15) Photoprocessing machinery and equipment, including
17repair and replacement parts, both new and used, including
18that manufactured on special order, certified by the purchaser
19to be used primarily for photoprocessing, and including
20photoprocessing machinery and equipment purchased for lease.
21    (16) Until July 1, 2023, coal and aggregate exploration,
22mining, off-highway hauling, processing, maintenance, and
23reclamation equipment, including replacement parts and
24equipment, and including equipment purchased for lease, but
25excluding motor vehicles required to be registered under the
26Illinois Vehicle Code. The changes made to this Section by

 

 

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1Public Act 97-767 apply on and after July 1, 2003, but no claim
2for credit or refund is allowed on or after August 16, 2013
3(the effective date of Public Act 98-456) for such taxes paid
4during the period beginning July 1, 2003 and ending on August
516, 2013 (the effective date of Public Act 98-456).
6    (17) Until July 1, 2003, distillation machinery and
7equipment, sold as a unit or kit, assembled or installed by the
8retailer, certified by the user to be used only for the
9production of ethyl alcohol that will be used for consumption
10as motor fuel or as a component of motor fuel for the personal
11use of the user, and not subject to sale or resale.
12    (18) Manufacturing and assembling machinery and equipment
13used primarily in the process of manufacturing or assembling
14tangible personal property for wholesale or retail sale or
15lease, whether that sale or lease is made directly by the
16manufacturer or by some other person, whether the materials
17used in the process are owned by the manufacturer or some other
18person, or whether that sale or lease is made apart from or as
19an incident to the seller's engaging in the service occupation
20of producing machines, tools, dies, jigs, patterns, gauges, or
21other similar items of no commercial value on special order
22for a particular purchaser. The exemption provided by this
23paragraph (18) includes production related tangible personal
24property, as defined in Section 3-50, purchased on or after
25July 1, 2019. The exemption provided by this paragraph (18)
26does not include machinery and equipment used in (i) the

 

 

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1generation of electricity for wholesale or retail sale; (ii)
2the generation or treatment of natural or artificial gas for
3wholesale or retail sale that is delivered to customers
4through pipes, pipelines, or mains; or (iii) the treatment of
5water for wholesale or retail sale that is delivered to
6customers through pipes, pipelines, or mains. The provisions
7of Public Act 98-583 are declaratory of existing law as to the
8meaning and scope of this exemption. Beginning on July 1,
92017, the exemption provided by this paragraph (18) includes,
10but is not limited to, graphic arts machinery and equipment,
11as defined in paragraph (6) of this Section.
12    (19) Personal property delivered to a purchaser or
13purchaser's donee inside Illinois when the purchase order for
14that personal property was received by a florist located
15outside Illinois who has a florist located inside Illinois
16deliver the personal property.
17    (20) Semen used for artificial insemination of livestock
18for direct agricultural production.
19    (21) Horses, or interests in horses, registered with and
20meeting the requirements of any of the Arabian Horse Club
21Registry of America, Appaloosa Horse Club, American Quarter
22Horse Association, United States Trotting Association, or
23Jockey Club, as appropriate, used for purposes of breeding or
24racing for prizes. This item (21) is exempt from the
25provisions of Section 3-90, and the exemption provided for
26under this item (21) applies for all periods beginning May 30,

 

 

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11995, but no claim for credit or refund is allowed on or after
2January 1, 2008 for such taxes paid during the period
3beginning May 30, 2000 and ending on January 1, 2008.
4    (22) Computers and communications equipment utilized for
5any hospital purpose and equipment used in the diagnosis,
6analysis, or treatment of hospital patients purchased by a
7lessor who leases the equipment, under a lease of one year or
8longer executed or in effect at the time the lessor would
9otherwise be subject to the tax imposed by this Act, to a
10hospital that has been issued an active tax exemption
11identification number by the Department under Section 1g of
12the Retailers' Occupation Tax Act. If the equipment is leased
13in a manner that does not qualify for this exemption or is used
14in any other non-exempt manner, the lessor shall be liable for
15the tax imposed under this Act or the Service Use Tax Act, as
16the case may be, based on the fair market value of the property
17at the time the non-qualifying use occurs. No lessor shall
18collect or attempt to collect an amount (however designated)
19that purports to reimburse that lessor for the tax imposed by
20this Act or the Service Use Tax Act, as the case may be, if the
21tax has not been paid by the lessor. If a lessor improperly
22collects any such amount from the lessee, the lessee shall
23have a legal right to claim a refund of that amount from the
24lessor. If, however, that amount is not refunded to the lessee
25for any reason, the lessor is liable to pay that amount to the
26Department.

 

 

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

 

 

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1manufacturer or retailer that is registered in this State to a
2corporation, society, association, foundation, or institution
3that has been issued a sales tax exemption identification
4number by the Department that assists victims of the disaster
5who reside within the declared disaster area.
6    (25) Beginning with taxable years ending on or after
7December 31, 1995 and ending with taxable years ending on or
8before December 31, 2004, personal property that is used in
9the performance of infrastructure repairs in this State,
10including but not limited to municipal roads and streets,
11access roads, bridges, sidewalks, waste disposal systems,
12water and sewer line extensions, water distribution and
13purification facilities, storm water drainage and retention
14facilities, and sewage treatment facilities, resulting from a
15State or federally declared disaster in Illinois or bordering
16Illinois when such repairs are initiated on facilities located
17in the declared disaster area within 6 months after the
18disaster.
19    (26) Beginning July 1, 1999, game or game birds purchased
20at a "game breeding and hunting preserve area" as that term is
21used in the Wildlife Code. This paragraph is exempt from the
22provisions of Section 3-90.
23    (27) A motor vehicle, as that term is defined in Section
241-146 of the Illinois Vehicle Code, that is donated to a
25corporation, limited liability company, society, association,
26foundation, or institution that is determined by the

 

 

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

 

 

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1purpose of resale by the fundraising entity and that profits
2from the sale to the fundraising entity. This paragraph is
3exempt from the provisions of Section 3-90.
4    (29) Beginning January 1, 2000 and through December 31,
52001, new or used automatic vending machines that prepare and
6serve hot food and beverages, including coffee, soup, and
7other items, and replacement parts for these machines.
8Beginning January 1, 2002 and through June 30, 2003, machines
9and parts for machines used in commercial, coin-operated
10amusement and vending business if a use or occupation tax is
11paid on the gross receipts derived from the use of the
12commercial, coin-operated amusement and vending machines. This
13paragraph is exempt from the provisions of Section 3-90.
14    (30) Beginning January 1, 2001 and through June 30, 2016,
15food for human consumption that is to be consumed off the
16premises where it is sold (other than alcoholic beverages,
17soft drinks, and food that has been prepared for immediate
18consumption) and prescription and nonprescription medicines,
19drugs, medical appliances, and insulin, urine testing
20materials, syringes, and needles used by diabetics, for human
21use, when purchased for use by a person receiving medical
22assistance under Article V of the Illinois Public Aid Code who
23resides in a licensed long-term care facility, as defined in
24the Nursing Home Care Act, or in a licensed facility as defined
25in the ID/DD Community Care Act, the MC/DD Act, or the
26Specialized Mental Health Rehabilitation Act of 2013.

 

 

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1    (31) Beginning on August 2, 2001 (the effective date of
2Public Act 92-227), computers and communications equipment
3utilized for any hospital purpose and equipment used in the
4diagnosis, analysis, or treatment of hospital patients
5purchased by a lessor who leases the equipment, under a lease
6of one year or longer executed or in effect at the time the
7lessor would otherwise be subject to the tax imposed by this
8Act, to a hospital that has been issued an active tax exemption
9identification number by the Department under Section 1g of
10the Retailers' Occupation Tax Act. If the equipment is leased
11in a manner that does not qualify for this exemption or is used
12in any other nonexempt manner, the lessor shall be liable for
13the tax imposed under this Act or the Service Use Tax Act, as
14the case may be, based on the fair market value of the property
15at the time the nonqualifying use occurs. No lessor shall
16collect or attempt to collect an amount (however designated)
17that purports to reimburse that lessor for the tax imposed by
18this Act or the Service Use Tax Act, as the case may be, if the
19tax has not been paid by the lessor. If a lessor improperly
20collects any such amount from the lessee, the lessee shall
21have a legal right to claim a refund of that amount from the
22lessor. If, however, that amount is not refunded to the lessee
23for any reason, the lessor is liable to pay that amount to the
24Department. This paragraph is exempt from the provisions of
25Section 3-90.
26    (32) Beginning on August 2, 2001 (the effective date of

 

 

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1Public Act 92-227), personal property purchased by a lessor
2who leases the property, under a lease of one year or longer
3executed or in effect at the time the lessor would otherwise be
4subject to the tax imposed by this Act, to a governmental body
5that has been issued an active sales tax exemption
6identification number by the Department under Section 1g of
7the Retailers' Occupation Tax Act. If the property is leased
8in a manner that does not qualify for this exemption or used in
9any other nonexempt manner, the lessor shall be liable for the
10tax imposed under this Act or the Service Use Tax Act, as the
11case may be, based on the fair market value of the property at
12the time the nonqualifying use occurs. No lessor shall collect
13or attempt to collect an amount (however designated) that
14purports to reimburse that lessor for the tax imposed by this
15Act or the Service Use Tax Act, as the case may be, if the tax
16has not been paid by the lessor. If a lessor improperly
17collects any such amount from the lessee, the lessee shall
18have a legal right to claim a refund of that amount from the
19lessor. If, however, that amount is not refunded to the lessee
20for any reason, the lessor is liable to pay that amount to the
21Department. This paragraph is exempt from the provisions of
22Section 3-90.
23    (33) On and after July 1, 2003 and through June 30, 2004,
24the use in this State of motor vehicles of the second division
25with a gross vehicle weight in excess of 8,000 pounds and that
26are subject to the commercial distribution fee imposed under

 

 

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1Section 3-815.1 of the Illinois Vehicle Code. Beginning on
2July 1, 2004 and through June 30, 2005, the use in this State
3of motor vehicles of the second division: (i) with a gross
4vehicle weight rating in excess of 8,000 pounds; (ii) that are
5subject to the commercial distribution fee imposed under
6Section 3-815.1 of the Illinois Vehicle Code; and (iii) that
7are primarily used for commercial purposes. Through June 30,
82005, this exemption applies to repair and replacement parts
9added after the initial purchase of such a motor vehicle if
10that motor vehicle is used in a manner that would qualify for
11the rolling stock exemption otherwise provided for in this
12Act. For purposes of this paragraph, the term "used for
13commercial purposes" means the transportation of persons or
14property in furtherance of any commercial or industrial
15enterprise, whether for-hire or not.
16    (34) Beginning January 1, 2008, tangible personal property
17used in the construction or maintenance of a community water
18supply, as defined under Section 3.145 of the Environmental
19Protection Act, that is operated by a not-for-profit
20corporation that holds a valid water supply permit issued
21under Title IV of the Environmental Protection Act. This
22paragraph is exempt from the provisions of Section 3-90.
23    (35) Beginning January 1, 2010 and continuing through
24December 31, 2024, materials, parts, equipment, components,
25and furnishings incorporated into or upon an aircraft as part
26of the modification, refurbishment, completion, replacement,

 

 

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1repair, or maintenance of the aircraft. This exemption
2includes consumable supplies used in the modification,
3refurbishment, completion, replacement, repair, and
4maintenance of aircraft, but excludes any materials, parts,
5equipment, components, and consumable supplies used in the
6modification, replacement, repair, and maintenance of aircraft
7engines or power plants, whether such engines or power plants
8are installed or uninstalled upon any such aircraft.
9"Consumable supplies" include, but are not limited to,
10adhesive, tape, sandpaper, general purpose lubricants,
11cleaning solution, latex gloves, and protective films. This
12exemption applies only to the use of qualifying tangible
13personal property by persons who modify, refurbish, complete,
14repair, replace, or maintain aircraft and who (i) hold an Air
15Agency Certificate and are empowered to operate an approved
16repair station by the Federal Aviation Administration, (ii)
17have a Class IV Rating, and (iii) conduct operations in
18accordance with Part 145 of the Federal Aviation Regulations.
19The exemption does not include aircraft operated by a
20commercial air carrier providing scheduled passenger air
21service pursuant to authority issued under Part 121 or Part
22129 of the Federal Aviation Regulations. The changes made to
23this paragraph (35) by Public Act 98-534 are declarative of
24existing law. It is the intent of the General Assembly that the
25exemption under this paragraph (35) applies continuously from
26January 1, 2010 through December 31, 2024; however, no claim

 

 

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1for credit or refund is allowed for taxes paid as a result of
2the disallowance of this exemption on or after January 1, 2015
3and prior to the effective date of this amendatory Act of the
4101st General Assembly.
5    (36) Tangible personal property purchased by a
6public-facilities corporation, as described in Section
711-65-10 of the Illinois Municipal Code, for purposes of
8constructing or furnishing a municipal convention hall, but
9only if the legal title to the municipal convention hall is
10transferred to the municipality without any further
11consideration by or on behalf of the municipality at the time
12of the completion of the municipal convention hall or upon the
13retirement or redemption of any bonds or other debt
14instruments issued by the public-facilities corporation in
15connection with the development of the municipal convention
16hall. This exemption includes existing public-facilities
17corporations as provided in Section 11-65-25 of the Illinois
18Municipal Code. This paragraph is exempt from the provisions
19of Section 3-90.
20    (37) Beginning January 1, 2017 and through December 31,
212026, menstrual pads, tampons, and menstrual cups.
22    (38) Merchandise that is subject to the Rental Purchase
23Agreement Occupation and Use Tax. The purchaser must certify
24that the item is purchased to be rented subject to a rental
25purchase agreement, as defined in the Rental Purchase
26Agreement Act, and provide proof of registration under the

 

 

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1Rental Purchase Agreement Occupation and Use Tax Act. This
2paragraph is exempt from the provisions of Section 3-90.
3    (39) Tangible personal property purchased by a purchaser
4who is exempt from the tax imposed by this Act by operation of
5federal law. This paragraph is exempt from the provisions of
6Section 3-90.
7    (40) Qualified tangible personal property used in the
8construction or operation of a data center that has been
9granted a certificate of exemption by the Department of
10Commerce and Economic Opportunity, whether that tangible
11personal property is purchased by the owner, operator, or
12tenant of the data center or by a contractor or subcontractor
13of the owner, operator, or tenant. Data centers that would
14have qualified for a certificate of exemption prior to January
151, 2020 had Public Act 101-31 been in effect may apply for and
16obtain an exemption for subsequent purchases of computer
17equipment or enabling software purchased or leased to upgrade,
18supplement, or replace computer equipment or enabling software
19purchased or leased in the original investment that would have
20qualified.
21    The Department of Commerce and Economic Opportunity shall
22grant a certificate of exemption under this item (40) to
23qualified data centers as defined by Section 605-1025 of the
24Department of Commerce and Economic Opportunity Law of the
25Civil Administrative Code of Illinois.
26    For the purposes of this item (40):

 

 

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1        "Data center" means a building or a series of
2    buildings rehabilitated or constructed to house working
3    servers in one physical location or multiple sites within
4    the State of Illinois.
5        "Qualified tangible personal property" means:
6    electrical systems and equipment; climate control and
7    chilling equipment and systems; mechanical systems and
8    equipment; monitoring and secure systems; emergency
9    generators; hardware; computers; servers; data storage
10    devices; network connectivity equipment; racks; cabinets;
11    telecommunications cabling infrastructure; raised floor
12    systems; peripheral components or systems; software;
13    mechanical, electrical, or plumbing systems; battery
14    systems; cooling systems and towers; temperature control
15    systems; other cabling; and other data center
16    infrastructure equipment and systems necessary to operate
17    qualified tangible personal property, including fixtures;
18    and component parts of any of the foregoing, including
19    installation, maintenance, repair, refurbishment, and
20    replacement of qualified tangible personal property to
21    generate, transform, transmit, distribute, or manage
22    electricity necessary to operate qualified tangible
23    personal property; and all other tangible personal
24    property that is essential to the operations of a computer
25    data center. The term "qualified tangible personal
26    property" also includes building materials physically

 

 

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1    incorporated in to the qualifying data center. To document
2    the exemption allowed under this Section, the retailer
3    must obtain from the purchaser a copy of the certificate
4    of eligibility issued by the Department of Commerce and
5    Economic Opportunity.
6    This item (40) is exempt from the provisions of Section
73-90.
8    (41) Tangible personal property for which a certificate of
9exemption has been issued under Section 2505-805 of the
10Department of Revenue Law of the Civil Administrative Code of
11Illinois. This paragraph is exempt from the provisions of
12Section 3-90.
13(Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 6-28-19;
14101-81, eff. 7-12-19; 101-629, eff. 2-5-20; 102-16, eff.
156-17-21.)
 
16    Section 15. The Service Use Tax Act is amended by changing
17Section 3-5 as follows:
 
18    (35 ILCS 110/3-5)
19    Sec. 3-5. Exemptions. Use of the following tangible
20personal property is exempt from the tax imposed by this Act:
21    (1) Personal property purchased from a corporation,
22society, association, foundation, institution, or
23organization, other than a limited liability company, that is
24organized and operated as a not-for-profit service enterprise

 

 

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1for the benefit of persons 65 years of age or older if the
2personal property was not purchased by the enterprise for the
3purpose of resale by the enterprise.
4    (2) Personal property purchased by a non-profit Illinois
5county fair association for use in conducting, operating, or
6promoting the county fair.
7    (3) Personal property purchased by a not-for-profit arts
8or cultural organization that establishes, by proof required
9by the Department by rule, that it has received an exemption
10under Section 501(c)(3) of the Internal Revenue Code and that
11is organized and operated primarily for the presentation or
12support of arts or cultural programming, activities, or
13services. These organizations include, but are not limited to,
14music and dramatic arts organizations such as symphony
15orchestras and theatrical groups, arts and cultural service
16organizations, local arts councils, visual arts organizations,
17and media arts organizations. On and after July 1, 2001 (the
18effective date of Public Act 92-35), however, an entity
19otherwise eligible for this exemption shall not make tax-free
20purchases unless it has an active identification number issued
21by the Department.
22    (4) Legal tender, currency, medallions, or gold or silver
23coinage issued by the State of Illinois, the government of the
24United States of America, or the government of any foreign
25country, and bullion.
26    (5) Until July 1, 2003 and beginning again on September 1,

 

 

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12004 through August 30, 2014, graphic arts machinery and
2equipment, including repair and replacement parts, both new
3and used, and including that manufactured on special order or
4purchased for lease, certified by the purchaser to be used
5primarily for graphic arts production. Equipment includes
6chemicals or chemicals acting as catalysts but only if the
7chemicals or chemicals acting as catalysts effect a direct and
8immediate change upon a graphic arts product. Beginning on
9July 1, 2017, graphic arts machinery and equipment is included
10in the manufacturing and assembling machinery and equipment
11exemption under Section 2 of this Act.
12    (6) Personal property purchased from a teacher-sponsored
13student organization affiliated with an elementary or
14secondary school located in Illinois.
15    (7) Farm machinery and equipment, both new and used,
16including that manufactured on special order, certified by the
17purchaser to be used primarily for production agriculture or
18State or federal agricultural programs, including individual
19replacement parts for the machinery and equipment, including
20machinery and equipment purchased for lease, and including
21implements of husbandry defined in Section 1-130 of the
22Illinois Vehicle Code, farm machinery and agricultural
23chemical and fertilizer spreaders, and nurse wagons required
24to be registered under Section 3-809 of the Illinois Vehicle
25Code, but excluding other motor vehicles required to be
26registered under the Illinois Vehicle Code. Horticultural

 

 

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1polyhouses or hoop houses used for propagating, growing, or
2overwintering plants shall be considered farm machinery and
3equipment under this item (7). Agricultural chemical tender
4tanks and dry boxes shall include units sold separately from a
5motor vehicle required to be licensed and units sold mounted
6on a motor vehicle required to be licensed if the selling price
7of the tender is separately stated.
8    Farm machinery and equipment shall include precision
9farming equipment that is installed or purchased to be
10installed on farm machinery and equipment including, but not
11limited to, tractors, harvesters, sprayers, planters, seeders,
12or spreaders. Precision farming equipment includes, but is not
13limited to, soil testing sensors, computers, monitors,
14software, global positioning and mapping systems, and other
15such equipment.
16    Farm machinery and equipment also includes computers,
17sensors, software, and related equipment used primarily in the
18computer-assisted operation of production agriculture
19facilities, equipment, and activities such as, but not limited
20to, the collection, monitoring, and correlation of animal and
21crop data for the purpose of formulating animal diets and
22agricultural chemicals. This item (7) is exempt from the
23provisions of Section 3-75.
24    (8) Until June 30, 2013, fuel and petroleum products sold
25to or used by an air common carrier, certified by the carrier
26to be used for consumption, shipment, or storage in the

 

 

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1conduct of its business as an air common carrier, for a flight
2destined for or returning from a location or locations outside
3the United States without regard to previous or subsequent
4domestic stopovers.
5    Beginning July 1, 2013, fuel and petroleum products sold
6to or used by an air carrier, certified by the carrier to be
7used for consumption, shipment, or storage in the conduct of
8its business as an air common carrier, for a flight that (i) is
9engaged in foreign trade or is engaged in trade between the
10United States and any of its possessions and (ii) transports
11at least one individual or package for hire from the city of
12origination to the city of final destination on the same
13aircraft, without regard to a change in the flight number of
14that aircraft.
15    (9) Proceeds of mandatory service charges separately
16stated on customers' bills for the purchase and consumption of
17food and beverages acquired as an incident to the purchase of a
18service from a serviceman, to the extent that the proceeds of
19the service charge are in fact turned over as tips or as a
20substitute for tips to the employees who participate directly
21in preparing, serving, hosting or cleaning up the food or
22beverage function with respect to which the service charge is
23imposed.
24    (10) Until July 1, 2003, oil field exploration, drilling,
25and production equipment, including (i) rigs and parts of
26rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)

 

 

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1pipe and tubular goods, including casing and drill strings,
2(iii) pumps and pump-jack units, (iv) storage tanks and flow
3lines, (v) any individual replacement part for oil field
4exploration, drilling, and production equipment, and (vi)
5machinery and equipment purchased for lease; but excluding
6motor vehicles required to be registered under the Illinois
7Vehicle Code.
8    (11) Proceeds from the sale of photoprocessing machinery
9and equipment, including repair and replacement parts, both
10new and used, including that manufactured on special order,
11certified by the purchaser to be used primarily for
12photoprocessing, and including photoprocessing machinery and
13equipment purchased for lease.
14    (12) Until July 1, 2023, coal and aggregate exploration,
15mining, off-highway hauling, processing, maintenance, and
16reclamation equipment, including replacement parts and
17equipment, and including equipment purchased for lease, but
18excluding motor vehicles required to be registered under the
19Illinois Vehicle Code. The changes made to this Section by
20Public Act 97-767 apply on and after July 1, 2003, but no claim
21for credit or refund is allowed on or after August 16, 2013
22(the effective date of Public Act 98-456) for such taxes paid
23during the period beginning July 1, 2003 and ending on August
2416, 2013 (the effective date of Public Act 98-456).
25    (13) Semen used for artificial insemination of livestock
26for direct agricultural production.

 

 

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1    (14) Horses, or interests in horses, registered with and
2meeting the requirements of any of the Arabian Horse Club
3Registry of America, Appaloosa Horse Club, American Quarter
4Horse Association, United States Trotting Association, or
5Jockey Club, as appropriate, used for purposes of breeding or
6racing for prizes. This item (14) is exempt from the
7provisions of Section 3-75, and the exemption provided for
8under this item (14) applies for all periods beginning May 30,
91995, but no claim for credit or refund is allowed on or after
10January 1, 2008 (the effective date of Public Act 95-88) for
11such taxes paid during the period beginning May 30, 2000 and
12ending on January 1, 2008 (the effective date of Public Act
1395-88).
14    (15) Computers and communications equipment utilized for
15any hospital purpose and equipment used in the diagnosis,
16analysis, or treatment of hospital patients purchased by a
17lessor who leases the equipment, 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
20hospital that has been issued an active tax exemption
21identification number by the Department under Section 1g of
22the Retailers' Occupation Tax Act. If the equipment is leased
23in a manner that does not qualify for this exemption or is used
24in any other non-exempt manner, the lessor shall be liable for
25the tax imposed under this Act or the Use Tax Act, as the case
26may be, based on the fair market value of the property at the

 

 

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

 

 

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1from the lessee, the lessee shall have a legal right to claim a
2refund of that amount from the lessor. If, however, that
3amount is not refunded to the lessee for any reason, the lessor
4is liable to pay that amount to the Department.
5    (17) 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 donated
8for disaster relief to be used in a State or federally declared
9disaster area in Illinois or bordering Illinois by a
10manufacturer or retailer that is registered in this State to a
11corporation, society, association, foundation, or institution
12that has been issued a sales tax exemption identification
13number by the Department that assists victims of the disaster
14who reside within the declared disaster area.
15    (18) Beginning with taxable years ending on or after
16December 31, 1995 and ending with taxable years ending on or
17before December 31, 2004, personal property that is used in
18the performance of infrastructure repairs in this State,
19including but not limited to municipal roads and streets,
20access roads, bridges, sidewalks, waste disposal systems,
21water and sewer line extensions, water distribution and
22purification facilities, storm water drainage and retention
23facilities, and sewage treatment facilities, resulting from a
24State or federally declared disaster in Illinois or bordering
25Illinois when such repairs are initiated on facilities located
26in the declared disaster area within 6 months after the

 

 

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1disaster.
2    (19) Beginning July 1, 1999, game or game birds purchased
3at a "game breeding and hunting preserve area" as that term is
4used in the Wildlife Code. This paragraph is exempt from the
5provisions of Section 3-75.
6    (20) A motor vehicle, as that term is defined in Section
71-146 of the Illinois Vehicle Code, that is donated to a
8corporation, limited liability company, society, association,
9foundation, or institution that is determined by the
10Department to be organized and operated exclusively for
11educational purposes. For purposes of this exemption, "a
12corporation, limited liability company, society, association,
13foundation, or institution organized and operated exclusively
14for educational purposes" means all tax-supported public
15schools, private schools that offer systematic instruction in
16useful branches of learning by methods common to public
17schools and that compare favorably in their scope and
18intensity with the course of study presented in tax-supported
19schools, and vocational or technical schools or institutes
20organized and operated exclusively to provide a course of
21study of not less than 6 weeks duration and designed to prepare
22individuals to follow a trade or to pursue a manual,
23technical, mechanical, industrial, business, or commercial
24occupation.
25    (21) Beginning January 1, 2000, personal property,
26including food, purchased through fundraising events for the

 

 

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1benefit of a public or private elementary or secondary school,
2a group of those schools, or one or more school districts if
3the events are sponsored by an entity recognized by the school
4district that consists primarily of volunteers and includes
5parents and teachers of the school children. This paragraph
6does not apply to fundraising events (i) for the benefit of
7private home instruction or (ii) for which the fundraising
8entity purchases the personal property sold at the events from
9another individual or entity that sold the property for the
10purpose of resale by the fundraising entity and that profits
11from the sale to the fundraising entity. This paragraph is
12exempt from the provisions of Section 3-75.
13    (22) Beginning January 1, 2000 and through December 31,
142001, new or used automatic vending machines that prepare and
15serve hot food and beverages, including coffee, soup, and
16other items, and replacement parts for these machines.
17Beginning January 1, 2002 and through June 30, 2003, machines
18and parts for machines used in commercial, coin-operated
19amusement and vending business if a use or occupation tax is
20paid on the gross receipts derived from the use of the
21commercial, coin-operated amusement and vending machines. This
22paragraph is exempt from the provisions of Section 3-75.
23    (23) Beginning August 23, 2001 and through June 30, 2016,
24food for human consumption that is to be consumed off the
25premises where it is sold (other than alcoholic beverages,
26soft drinks, and food that has been prepared for immediate

 

 

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1consumption) and prescription and nonprescription medicines,
2drugs, medical appliances, and insulin, urine testing
3materials, syringes, and needles used by diabetics, for human
4use, when purchased for use by a person receiving medical
5assistance under Article V of the Illinois Public Aid Code who
6resides in a licensed long-term care facility, as defined in
7the Nursing Home Care Act, or in a licensed facility as defined
8in the ID/DD Community Care Act, the MC/DD Act, or the
9Specialized Mental Health Rehabilitation Act of 2013.
10    (24) Beginning on August 2, 2001 (the effective date of
11Public Act 92-227), computers and communications equipment
12utilized for any hospital purpose and equipment used in the
13diagnosis, analysis, or treatment of hospital patients
14purchased by a lessor who leases the equipment, under a lease
15of one year or longer executed or in effect at the time the
16lessor would otherwise be subject to the tax imposed by this
17Act, to a hospital that has been issued an active tax exemption
18identification number by the Department under Section 1g of
19the Retailers' Occupation Tax Act. If the equipment is leased
20in a manner that does not qualify for this exemption or is used
21in any other nonexempt manner, the lessor shall be liable for
22the tax imposed under this Act or the Use Tax Act, as the case
23may be, based on the fair market value of the property at the
24time the nonqualifying use occurs. No lessor shall collect or
25attempt to collect an amount (however designated) that
26purports to reimburse that lessor for the tax imposed by this

 

 

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1Act or the Use Tax Act, as the case may be, if the tax has not
2been paid by the lessor. If a lessor improperly collects any
3such amount from the lessee, the lessee shall have a legal
4right to claim a refund of that amount from the lessor. If,
5however, that amount is not refunded to the lessee for any
6reason, the lessor is liable to pay that amount to the
7Department. This paragraph is exempt from the provisions of
8Section 3-75.
9    (25) Beginning on August 2, 2001 (the effective date of
10Public Act 92-227), personal property purchased by a lessor
11who leases the property, under a lease of one year or longer
12executed or in effect at the time the lessor would otherwise be
13subject to the tax imposed by this Act, to a governmental body
14that has been issued an active tax exemption identification
15number by the Department under Section 1g of the Retailers'
16Occupation Tax Act. If the property is leased in a manner that
17does not qualify for this exemption or is used in any other
18nonexempt manner, the lessor shall be liable for the tax
19imposed under this Act or the Use Tax Act, as the case may be,
20based on the fair market value of the property at the time the
21nonqualifying use occurs. No lessor shall collect or attempt
22to collect an amount (however designated) that purports to
23reimburse that lessor for the tax imposed by this Act or the
24Use Tax Act, as the case may be, if the tax has not been paid
25by the lessor. If a lessor improperly collects any such amount
26from the lessee, the lessee shall have a legal right to claim a

 

 

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1refund of that amount from the lessor. If, however, that
2amount is not refunded to the lessee for any reason, the lessor
3is liable to pay that amount to the Department. This paragraph
4is exempt from the provisions of Section 3-75.
5    (26) 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
10under Title IV of the Environmental Protection Act. This
11paragraph is exempt from the provisions of Section 3-75.
12    (27) Beginning January 1, 2010 and continuing through
13December 31, 2024, materials, parts, equipment, components,
14and furnishings incorporated into or upon an aircraft as part
15of the modification, refurbishment, completion, replacement,
16repair, or maintenance of the aircraft. This exemption
17includes consumable supplies used in the modification,
18refurbishment, completion, replacement, repair, and
19maintenance of aircraft, but excludes any materials, parts,
20equipment, components, and consumable supplies used in the
21modification, replacement, repair, and maintenance of aircraft
22engines or power plants, whether such engines or power plants
23are installed or uninstalled upon any such aircraft.
24"Consumable supplies" include, but are not limited to,
25adhesive, tape, sandpaper, general purpose lubricants,
26cleaning solution, latex gloves, and protective films. This

 

 

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1exemption applies only to the use of qualifying tangible
2personal property transferred incident to the modification,
3refurbishment, completion, replacement, repair, or maintenance
4of aircraft by persons who (i) hold an Air Agency Certificate
5and are empowered to operate an approved repair station by the
6Federal Aviation Administration, (ii) have a Class IV Rating,
7and (iii) conduct operations in accordance with Part 145 of
8the Federal Aviation Regulations. The exemption does not
9include aircraft operated by a commercial air carrier
10providing scheduled passenger air service pursuant to
11authority issued under Part 121 or Part 129 of the Federal
12Aviation Regulations. The changes made to this paragraph (27)
13by Public Act 98-534 are declarative of existing law. It is the
14intent of the General Assembly that the exemption under this
15paragraph (27) applies continuously from January 1, 2010
16through December 31, 2024; however, no claim for credit or
17refund is allowed for taxes paid as a result of the
18disallowance of this exemption on or after January 1, 2015 and
19prior to the effective date of this amendatory Act of the 101st
20General Assembly.
21    (28) Tangible personal property purchased by a
22public-facilities corporation, as described in Section
2311-65-10 of the Illinois Municipal Code, for purposes of
24constructing or furnishing a municipal convention hall, but
25only if the legal title to the municipal convention hall is
26transferred to the municipality without any further

 

 

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1consideration by or on behalf of the municipality at the time
2of the completion of the municipal convention hall or upon the
3retirement or redemption of any bonds or other debt
4instruments issued by the public-facilities corporation in
5connection with the development of the municipal convention
6hall. This exemption includes existing public-facilities
7corporations as provided in Section 11-65-25 of the Illinois
8Municipal Code. This paragraph is exempt from the provisions
9of Section 3-75.
10    (29) Beginning January 1, 2017 and through December 31,
112026, menstrual pads, tampons, and menstrual cups.
12    (30) Tangible personal property transferred to a purchaser
13who is exempt from the tax imposed by this Act by operation of
14federal law. This paragraph is exempt from the provisions of
15Section 3-75.
16    (31) Qualified tangible personal property used in the
17construction or operation of a data center that has been
18granted a certificate of exemption by the Department of
19Commerce and Economic Opportunity, whether that tangible
20personal property is purchased by the owner, operator, or
21tenant of the data center or by a contractor or subcontractor
22of the owner, operator, or tenant. Data centers that would
23have qualified for a certificate of exemption prior to January
241, 2020 had this amendatory Act of the 101st General Assembly
25been in effect, may apply for and obtain an exemption for
26subsequent purchases of computer equipment or enabling

 

 

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1software purchased or leased to upgrade, supplement, or
2replace computer equipment or enabling software purchased or
3leased in the original investment that would have qualified.
4    The Department of Commerce and Economic Opportunity shall
5grant a certificate of exemption under this item (31) to
6qualified data centers as defined by Section 605-1025 of the
7Department of Commerce and Economic Opportunity Law of the
8Civil Administrative Code of Illinois.
9    For the purposes of this item (31):
10        "Data center" means a building or a series of
11    buildings rehabilitated or constructed to house working
12    servers in one physical location or multiple sites within
13    the State of Illinois.
14        "Qualified tangible personal property" means:
15    electrical systems and equipment; climate control and
16    chilling equipment and systems; mechanical systems and
17    equipment; monitoring and secure systems; emergency
18    generators; hardware; computers; servers; data storage
19    devices; network connectivity equipment; racks; cabinets;
20    telecommunications cabling infrastructure; raised floor
21    systems; peripheral components or systems; software;
22    mechanical, electrical, or plumbing systems; battery
23    systems; cooling systems and towers; temperature control
24    systems; other cabling; and other data center
25    infrastructure equipment and systems necessary to operate
26    qualified tangible personal property, including fixtures;

 

 

HB5040- 40 -LRB102 23725 HLH 32914 b

1    and component parts of any of the foregoing, including
2    installation, maintenance, repair, refurbishment, and
3    replacement of qualified tangible personal property to
4    generate, transform, transmit, distribute, or manage
5    electricity necessary to operate qualified tangible
6    personal property; and all other tangible personal
7    property that is essential to the operations of a computer
8    data center. The term "qualified tangible personal
9    property" also includes building materials physically
10    incorporated in to the qualifying data center. To document
11    the exemption allowed under this Section, the retailer
12    must obtain from the purchaser a copy of the certificate
13    of eligibility issued by the Department of Commerce and
14    Economic Opportunity.
15    This item (31) is exempt from the provisions of Section
163-75.
17    (32) Tangible personal property for which a certificate of
18exemption has been issued under Section 2505-805 of the
19Department of Revenue Law of the Civil Administrative Code of
20Illinois. This paragraph is exempt from the provisions of
21Section 3-75.
22(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
23101-629, eff. 2-5-20; 102-16, eff. 6-17-21.)
 
24    Section 20. 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
8benefit of persons 65 years of age or older if the personal
9property was not purchased by the enterprise for the purpose
10of resale by 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
16by the Department by rule, that it has received an exemption
17under Section 501(c)(3) of the Internal Revenue Code and that
18is organized 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 July 1, 2001 (the
25effective date of Public Act 92-35), however, an entity

 

 

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1otherwise eligible for this exemption shall not make tax-free
2purchases unless it has an active identification number issued
3by 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
11and used, 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. Beginning on
17July 1, 2017, graphic arts machinery and equipment is included
18in the manufacturing and assembling machinery and equipment
19exemption under Section 2 of this Act.
20    (6) Personal property sold by a teacher-sponsored student
21organization affiliated with an elementary or secondary school
22located in Illinois.
23    (7) 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
6to be registered under Section 3-809 of the Illinois Vehicle
7Code, but excluding other motor vehicles required to be
8registered under the Illinois Vehicle Code. Horticultural
9polyhouses or hoop houses used for propagating, growing, or
10overwintering plants shall be considered farm machinery and
11equipment under this item (7). Agricultural chemical tender
12tanks and dry boxes shall include units sold separately from a
13motor vehicle required to be licensed and units sold mounted
14on a motor vehicle required to be licensed if the selling price
15of the tender 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 (7) is exempt from the
5provisions of Section 3-55.
6    (8) 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
9conduct of its business as an air common carrier, for a flight
10destined for or returning from a location or locations outside
11the United States without regard to previous or subsequent
12domestic stopovers.
13    Beginning July 1, 2013, fuel and petroleum products sold
14to or used by an air carrier, certified by the carrier to be
15used for consumption, shipment, or storage in the conduct of
16its business 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
19at least 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    (9) Proceeds of mandatory service charges separately
24stated on customers' bills for the purchase and consumption of
25food and beverages, to the extent that the proceeds of the
26service charge are in fact turned over as tips or as a

 

 

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1substitute for tips to the employees who participate directly
2in preparing, serving, hosting or cleaning up the food or
3beverage function with respect to which the service charge is
4imposed.
5    (10) Until July 1, 2003, oil field exploration, drilling,
6and production equipment, including (i) rigs and parts of
7rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
8pipe and tubular goods, including casing and drill strings,
9(iii) pumps and pump-jack units, (iv) storage tanks and flow
10lines, (v) any individual replacement part for oil field
11exploration, drilling, and production equipment, and (vi)
12machinery and equipment purchased for lease; but excluding
13motor vehicles required to be registered under the Illinois
14Vehicle Code.
15    (11) Photoprocessing machinery and equipment, including
16repair and replacement parts, both new and used, including
17that manufactured on special order, certified by the purchaser
18to be used primarily for photoprocessing, and including
19photoprocessing machinery and equipment purchased for lease.
20    (12) Until July 1, 2023, coal and aggregate exploration,
21mining, off-highway hauling, processing, maintenance, and
22reclamation equipment, including replacement parts and
23equipment, and including equipment purchased for lease, but
24excluding motor vehicles required to be registered under the
25Illinois Vehicle Code. The changes made to this Section by
26Public Act 97-767 apply on and after July 1, 2003, but no claim

 

 

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1for credit or refund is allowed on or after August 16, 2013
2(the effective date of Public Act 98-456) for such taxes paid
3during the period beginning July 1, 2003 and ending on August
416, 2013 (the effective date of Public Act 98-456).
5    (13) Beginning January 1, 1992 and through June 30, 2016,
6food for human consumption that is to be consumed off the
7premises where it is sold (other than alcoholic beverages,
8soft drinks and food that has been prepared for immediate
9consumption) and prescription and non-prescription medicines,
10drugs, medical appliances, and insulin, urine testing
11materials, syringes, and needles used by diabetics, for human
12use, when purchased for use by a person receiving medical
13assistance under Article V of the Illinois Public Aid Code who
14resides in a licensed long-term care facility, as defined in
15the Nursing Home Care Act, or in a licensed facility as defined
16in the ID/DD Community Care Act, the MC/DD Act, or the
17Specialized Mental Health Rehabilitation Act of 2013.
18    (14) Semen used for artificial insemination of livestock
19for direct agricultural production.
20    (15) Horses, or interests in horses, registered with and
21meeting the requirements of any of the Arabian Horse Club
22Registry of America, Appaloosa Horse Club, American Quarter
23Horse Association, United States Trotting Association, or
24Jockey Club, as appropriate, used for purposes of breeding or
25racing for prizes. This item (15) is exempt from the
26provisions of Section 3-55, and the exemption provided for

 

 

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1under this item (15) applies for all periods beginning May 30,
21995, but no claim for credit or refund is allowed on or after
3January 1, 2008 (the effective date of Public Act 95-88) for
4such taxes paid during the period beginning May 30, 2000 and
5ending on January 1, 2008 (the effective date of Public Act
695-88).
7    (16) Computers and communications equipment utilized for
8any hospital purpose and equipment used in the diagnosis,
9analysis, or treatment of hospital patients sold to a lessor
10who leases the equipment, under a lease of one year or longer
11executed or in effect at the time of the purchase, to a
12hospital that has been issued an active tax exemption
13identification number by the Department under Section 1g of
14the Retailers' Occupation Tax Act.
15    (17) Personal property sold to a lessor who leases the
16property, under a lease of one year or longer executed or in
17effect at the time of the purchase, to a governmental body that
18has been issued an active tax exemption identification number
19by the Department under Section 1g of the Retailers'
20Occupation Tax Act.
21    (18) 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
24for disaster 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    (19) 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
8the performance of infrastructure repairs in this State,
9including but not limited to municipal roads and streets,
10access roads, bridges, sidewalks, waste disposal systems,
11water and sewer line extensions, water distribution and
12purification facilities, storm water drainage and retention
13facilities, and sewage treatment facilities, resulting from a
14State or federally declared disaster in Illinois or bordering
15Illinois when such repairs are initiated on facilities located
16in the declared disaster area within 6 months after the
17disaster.
18    (20) Beginning July 1, 1999, game or game birds sold at a
19"game breeding and hunting preserve area" as that term is used
20in the Wildlife Code. This paragraph is exempt from the
21provisions of Section 3-55.
22    (21) A motor vehicle, as that term is defined in Section
231-146 of the Illinois Vehicle Code, that is donated to a
24corporation, limited liability company, society, association,
25foundation, or institution that is determined by the
26Department to be organized and operated exclusively for

 

 

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

 

 

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1from the sale to the fundraising entity. This paragraph is
2exempt from the provisions of Section 3-55.
3    (23) Beginning January 1, 2000 and through December 31,
42001, new or used automatic vending machines that prepare and
5serve hot food and beverages, including coffee, soup, and
6other items, and replacement parts for these machines.
7Beginning January 1, 2002 and through June 30, 2003, machines
8and parts for machines used in commercial, coin-operated
9amusement and vending business if a use or occupation tax is
10paid on the gross receipts derived from the use of the
11commercial, coin-operated amusement and vending machines. This
12paragraph is exempt from the provisions of Section 3-55.
13    (24) Beginning on August 2, 2001 (the effective date of
14Public Act 92-227), computers and communications equipment
15utilized for any hospital purpose and equipment used in the
16diagnosis, analysis, or treatment of hospital patients sold to
17a lessor who leases the equipment, under a lease of one year or
18longer executed or in effect at the time of the purchase, to a
19hospital that has been issued an active tax exemption
20identification number by the Department under Section 1g of
21the Retailers' Occupation Tax Act. This paragraph is exempt
22from the provisions of Section 3-55.
23    (25) Beginning on August 2, 2001 (the effective date of
24Public Act 92-227), personal property sold to a lessor who
25leases the property, under a lease of one year or longer
26executed or in effect at the time of the purchase, 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
3the Retailers' Occupation Tax Act. This paragraph is exempt
4from the provisions of Section 3-55.
5    (26) Beginning on January 1, 2002 and through June 30,
62016, tangible personal property purchased from an Illinois
7retailer by a taxpayer engaged in centralized purchasing
8activities in Illinois who will, upon receipt of the property
9in Illinois, temporarily store the property in Illinois (i)
10for the purpose of subsequently transporting it outside this
11State for use or consumption thereafter solely outside this
12State or (ii) for the purpose of being processed, fabricated,
13or manufactured into, attached to, or incorporated into other
14tangible personal property to be transported outside this
15State and thereafter used or consumed solely outside this
16State. The Director of Revenue shall, pursuant to rules
17adopted in accordance with the Illinois Administrative
18Procedure Act, issue a permit to any taxpayer in good standing
19with the Department who is eligible for the exemption under
20this paragraph (26). The permit issued under this paragraph
21(26) shall authorize the holder, to the extent and in the
22manner specified in the rules adopted under this Act, to
23purchase tangible personal property from a retailer exempt
24from the taxes imposed by this Act. Taxpayers shall maintain
25all necessary books and records to substantiate the use and
26consumption of all such tangible personal property outside of

 

 

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1the State of Illinois.
2    (27) Beginning January 1, 2008, tangible personal property
3used in the construction or maintenance of a community water
4supply, as defined under Section 3.145 of the Environmental
5Protection Act, that is operated by a not-for-profit
6corporation that holds a valid water supply permit issued
7under Title IV of the Environmental Protection Act. This
8paragraph is exempt from the provisions of Section 3-55.
9    (28) Tangible personal property sold to a
10public-facilities corporation, as described in Section
1111-65-10 of the Illinois Municipal Code, for purposes of
12constructing or furnishing a municipal convention hall, but
13only if the legal title to the municipal convention hall is
14transferred to the municipality without any further
15consideration by or on behalf of the municipality at the time
16of the completion of the municipal convention hall or upon the
17retirement or redemption of any bonds or other debt
18instruments issued by the public-facilities corporation in
19connection with the development of the municipal convention
20hall. This exemption includes existing public-facilities
21corporations as provided in Section 11-65-25 of the Illinois
22Municipal Code. This paragraph is exempt from the provisions
23of Section 3-55.
24    (29) Beginning January 1, 2010 and continuing through
25December 31, 2024, materials, parts, equipment, components,
26and furnishings incorporated into or upon an aircraft as part

 

 

HB5040- 53 -LRB102 23725 HLH 32914 b

1of the modification, refurbishment, completion, replacement,
2repair, or maintenance of the aircraft. This exemption
3includes consumable supplies used in the modification,
4refurbishment, completion, replacement, repair, and
5maintenance of aircraft, but excludes any materials, parts,
6equipment, components, and consumable supplies used in the
7modification, replacement, repair, and maintenance of aircraft
8engines or power plants, whether such engines or power plants
9are installed or uninstalled upon any such aircraft.
10"Consumable supplies" include, but are not limited to,
11adhesive, tape, sandpaper, general purpose lubricants,
12cleaning solution, latex gloves, and protective films. This
13exemption applies only to the transfer of qualifying tangible
14personal property incident to the modification, refurbishment,
15completion, replacement, repair, or maintenance of an aircraft
16by persons who (i) hold an Air Agency Certificate and are
17empowered to operate an approved repair station by the Federal
18Aviation Administration, (ii) have a Class IV Rating, and
19(iii) conduct operations in accordance with Part 145 of the
20Federal Aviation Regulations. The exemption does not include
21aircraft operated by a commercial air carrier providing
22scheduled passenger air service pursuant to authority issued
23under Part 121 or Part 129 of the Federal Aviation
24Regulations. The changes made to this paragraph (29) by Public
25Act 98-534 are declarative of existing law. It is the intent of
26the General Assembly that the exemption under this paragraph

 

 

HB5040- 54 -LRB102 23725 HLH 32914 b

1(29) applies continuously from January 1, 2010 through
2December 31, 2024; however, no claim for credit or refund is
3allowed for taxes paid as a result of the disallowance of this
4exemption on or after January 1, 2015 and prior to the
5effective date of this amendatory Act of the 101st General
6Assembly.
7    (30) Beginning January 1, 2017 and through December 31,
82026, menstrual pads, tampons, and menstrual cups.
9    (31) Tangible personal property transferred to a purchaser
10who is exempt from tax by operation of federal law. This
11paragraph is exempt from the provisions of Section 3-55.
12    (32) Qualified tangible personal property used in the
13construction or operation of a data center that has been
14granted a certificate of exemption by the Department of
15Commerce and Economic Opportunity, whether that tangible
16personal property is purchased by the owner, operator, or
17tenant of the data center or by a contractor or subcontractor
18of the owner, operator, or tenant. Data centers that would
19have qualified for a certificate of exemption prior to January
201, 2020 had this amendatory Act of the 101st General Assembly
21been in effect, may apply for and obtain an exemption for
22subsequent purchases of computer equipment or enabling
23software purchased or leased to upgrade, supplement, or
24replace computer equipment or enabling software purchased or
25leased in the original investment that would have qualified.
26    The Department of Commerce and Economic Opportunity shall

 

 

HB5040- 55 -LRB102 23725 HLH 32914 b

1grant a certificate of exemption under this item (32) to
2qualified data centers as defined by Section 605-1025 of the
3Department of Commerce and Economic Opportunity Law of the
4Civil Administrative Code of Illinois.
5    For the purposes of this item (32):
6        "Data center" means a building or a series of
7    buildings rehabilitated or constructed to house working
8    servers in one physical location or multiple sites within
9    the State of Illinois.
10        "Qualified tangible personal property" means:
11    electrical systems and equipment; climate control and
12    chilling equipment and systems; mechanical systems and
13    equipment; monitoring and secure systems; emergency
14    generators; hardware; computers; servers; data storage
15    devices; network connectivity equipment; racks; cabinets;
16    telecommunications cabling infrastructure; raised floor
17    systems; peripheral components or systems; software;
18    mechanical, electrical, or plumbing systems; battery
19    systems; cooling systems and towers; temperature control
20    systems; other cabling; and other data center
21    infrastructure equipment and systems necessary to operate
22    qualified tangible personal property, including fixtures;
23    and component parts of any of the foregoing, including
24    installation, maintenance, repair, refurbishment, and
25    replacement of qualified tangible personal property to
26    generate, transform, transmit, distribute, or manage

 

 

HB5040- 56 -LRB102 23725 HLH 32914 b

1    electricity necessary to operate qualified tangible
2    personal property; and all other tangible personal
3    property that is essential to the operations of a computer
4    data center. The term "qualified tangible personal
5    property" also includes building materials physically
6    incorporated in to the qualifying data center. To document
7    the exemption allowed under this Section, the retailer
8    must obtain from the purchaser a copy of the certificate
9    of eligibility issued by the Department of Commerce and
10    Economic Opportunity.
11    This item (32) is exempt from the provisions of Section
123-55.
13    (33) Tangible personal property for which a certificate of
14exemption has been issued under Section 2505-805 of the
15Department of Revenue Law of the Civil Administrative Code of
16Illinois. This paragraph is exempt from the provisions of
17Section 3-55.
18(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
19101-629, eff. 2-5-20; 102-16, eff. 6-17-21.)
 
20    Section 25. The Retailers' Occupation Tax Act is amended
21by changing Section 2-5 as follows:
 
22    (35 ILCS 120/2-5)
23    Sec. 2-5. Exemptions. Gross receipts from proceeds from
24the sale of the following tangible personal property are

 

 

HB5040- 57 -LRB102 23725 HLH 32914 b

1exempt from the tax imposed by this Act:
2        (1) Farm chemicals.
3        (2) Farm machinery and equipment, both new and used,
4    including that manufactured on special order, certified by
5    the purchaser to be used primarily for production
6    agriculture or State or federal agricultural programs,
7    including individual replacement parts for the machinery
8    and equipment, including machinery and equipment purchased
9    for lease, and including implements of husbandry defined
10    in Section 1-130 of the Illinois Vehicle Code, farm
11    machinery and agricultural chemical and fertilizer
12    spreaders, and nurse wagons required to be registered
13    under Section 3-809 of the Illinois Vehicle Code, but
14    excluding other motor vehicles required to be registered
15    under the Illinois Vehicle Code. Horticultural polyhouses
16    or hoop houses used for propagating, growing, or
17    overwintering plants shall be considered farm machinery
18    and equipment under this item (2). Agricultural chemical
19    tender tanks and dry boxes shall include units sold
20    separately from a motor vehicle required to be licensed
21    and units sold mounted on a motor vehicle required to be
22    licensed, if the selling price of the tender is separately
23    stated.
24        Farm machinery and equipment shall include precision
25    farming equipment that is installed or purchased to be
26    installed on farm machinery and equipment including, but

 

 

HB5040- 58 -LRB102 23725 HLH 32914 b

1    not limited to, tractors, harvesters, sprayers, planters,
2    seeders, or spreaders. Precision farming equipment
3    includes, but is not limited to, soil testing sensors,
4    computers, monitors, software, global positioning and
5    mapping systems, and other such equipment.
6        Farm machinery and equipment also includes computers,
7    sensors, software, and related equipment used primarily in
8    the computer-assisted operation of production agriculture
9    facilities, equipment, and activities such as, but not
10    limited to, the collection, monitoring, and correlation of
11    animal and crop data for the purpose of formulating animal
12    diets and agricultural chemicals. This item (2) is exempt
13    from the provisions of Section 2-70.
14        (3) Until July 1, 2003, distillation machinery and
15    equipment, sold as a unit or kit, assembled or installed
16    by the retailer, certified by the user to be used only for
17    the production of ethyl alcohol that will be used for
18    consumption as motor fuel or as a component of motor fuel
19    for the personal use of the user, and not subject to sale
20    or resale.
21        (4) Until July 1, 2003 and beginning again September
22    1, 2004 through August 30, 2014, graphic arts machinery
23    and equipment, including repair and replacement parts,
24    both new and used, and including that manufactured on
25    special order or purchased for lease, certified by the
26    purchaser to be used primarily for graphic arts

 

 

HB5040- 59 -LRB102 23725 HLH 32914 b

1    production. Equipment includes chemicals or chemicals
2    acting as catalysts but only if the chemicals or chemicals
3    acting as catalysts effect a direct and immediate change
4    upon a graphic arts product. Beginning on July 1, 2017,
5    graphic arts machinery and equipment is included in the
6    manufacturing and assembling machinery and equipment
7    exemption under paragraph (14).
8        (5) A motor vehicle that is used for automobile
9    renting, as defined in the Automobile Renting Occupation
10    and Use Tax Act. This paragraph is exempt from the
11    provisions of Section 2-70.
12        (6) Personal property sold by a teacher-sponsored
13    student organization affiliated with an elementary or
14    secondary school located in Illinois.
15        (7) Until July 1, 2003, proceeds of that portion of
16    the selling price of a passenger car the sale of which is
17    subject to the Replacement Vehicle Tax.
18        (8) Personal property sold to an Illinois county fair
19    association for use in conducting, operating, or promoting
20    the county fair.
21        (9) Personal property sold to a not-for-profit arts or
22    cultural organization that establishes, by proof required
23    by the Department by rule, that it has received an
24    exemption under Section 501(c)(3) of the Internal Revenue
25    Code and that is organized and operated primarily for the
26    presentation or support of arts or cultural programming,

 

 

HB5040- 60 -LRB102 23725 HLH 32914 b

1    activities, or services. These organizations include, but
2    are not limited to, music and dramatic arts organizations
3    such as symphony orchestras and theatrical groups, arts
4    and cultural service organizations, local arts councils,
5    visual arts organizations, and media arts organizations.
6    On and after July 1, 2001 (the effective date of Public Act
7    92-35), however, an entity otherwise eligible for this
8    exemption shall not make tax-free purchases unless it has
9    an active identification number issued by the Department.
10        (10) Personal property sold by a corporation, society,
11    association, foundation, institution, or organization,
12    other than a limited liability company, that is organized
13    and operated as a not-for-profit service enterprise for
14    the benefit of persons 65 years of age or older if the
15    personal property was not purchased by the enterprise for
16    the purpose of resale by the enterprise.
17        (11) Personal property sold to a governmental body, to
18    a corporation, society, association, foundation, or
19    institution organized and operated exclusively for
20    charitable, religious, or educational purposes, or to a
21    not-for-profit corporation, society, association,
22    foundation, institution, or organization that has no
23    compensated officers or employees and that is organized
24    and operated primarily for the recreation of persons 55
25    years of age or older. A limited liability company may
26    qualify for the exemption under this paragraph only if the

 

 

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1    limited liability company is organized and operated
2    exclusively for educational purposes. On and after July 1,
3    1987, however, no entity otherwise eligible for this
4    exemption shall make tax-free purchases unless it has an
5    active identification number issued by the Department.
6        (12) (Blank).
7        (12-5) On and after July 1, 2003 and through June 30,
8    2004, motor vehicles of the second division with a gross
9    vehicle weight in excess of 8,000 pounds that are subject
10    to the commercial distribution fee imposed under Section
11    3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
12    2004 and through June 30, 2005, the use in this State of
13    motor vehicles of the second division: (i) with a gross
14    vehicle weight rating in excess of 8,000 pounds; (ii) that
15    are subject to the commercial distribution fee imposed
16    under Section 3-815.1 of the Illinois Vehicle Code; and
17    (iii) that are primarily used for commercial purposes.
18    Through June 30, 2005, this exemption applies to repair
19    and replacement parts added after the initial purchase of
20    such a motor vehicle if that motor vehicle is used in a
21    manner that would qualify for the rolling stock exemption
22    otherwise provided for in this Act. For purposes of this
23    paragraph, "used for commercial purposes" means the
24    transportation of persons or property in furtherance of
25    any commercial or industrial enterprise whether for-hire
26    or not.

 

 

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

 

 

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1    of water for wholesale or retail sale that is delivered to
2    customers through pipes, pipelines, or mains. The
3    provisions of Public Act 98-583 are declaratory of
4    existing law as to the meaning and scope of this
5    exemption. Beginning on July 1, 2017, the exemption
6    provided by this paragraph (14) includes, but is not
7    limited to, graphic arts machinery and equipment, as
8    defined in paragraph (4) of this Section.
9        (15) Proceeds of mandatory service charges separately
10    stated on customers' bills for purchase and consumption of
11    food and beverages, to the extent that the proceeds of the
12    service charge are in fact turned over as tips or as a
13    substitute for tips to the employees who participate
14    directly in preparing, serving, hosting or cleaning up the
15    food or beverage function with respect to which the
16    service charge is imposed.
17        (16) Tangible personal property sold to a purchaser if
18    the purchaser is exempt from use tax by operation of
19    federal law. This paragraph is exempt from the provisions
20    of Section 2-70.
21        (17) Tangible personal property sold to a common
22    carrier by rail or motor that receives the physical
23    possession of the property in Illinois and that transports
24    the property, or shares with another common carrier in the
25    transportation of the property, out of Illinois on a
26    standard uniform bill of lading showing the seller of the

 

 

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1    property as the shipper or consignor of the property to a
2    destination outside Illinois, for use outside Illinois.
3        (18) Legal tender, currency, medallions, or gold or
4    silver coinage issued by the State of Illinois, the
5    government of the United States of America, or the
6    government of any foreign country, and bullion.
7        (19) Until July 1, 2003, oil field exploration,
8    drilling, and production equipment, including (i) rigs and
9    parts of rigs, rotary rigs, cable tool rigs, and workover
10    rigs, (ii) pipe and tubular goods, including casing and
11    drill strings, (iii) pumps and pump-jack units, (iv)
12    storage tanks and flow lines, (v) any individual
13    replacement part for oil field exploration, drilling, and
14    production equipment, and (vi) machinery and equipment
15    purchased for lease; but excluding motor vehicles required
16    to be registered under the Illinois Vehicle Code.
17        (20) Photoprocessing machinery and equipment,
18    including repair and replacement parts, both new and used,
19    including that manufactured on special order, certified by
20    the purchaser to be used primarily for photoprocessing,
21    and including photoprocessing machinery and equipment
22    purchased for lease.
23        (21) Until July 1, 2023, coal and aggregate
24    exploration, mining, off-highway hauling, processing,
25    maintenance, and reclamation equipment, including
26    replacement parts and equipment, and including equipment

 

 

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1    purchased for lease, but excluding motor vehicles required
2    to be registered under the Illinois Vehicle Code. The
3    changes made to this Section by Public Act 97-767 apply on
4    and after July 1, 2003, but no claim for credit or refund
5    is allowed on or after August 16, 2013 (the effective date
6    of Public Act 98-456) for such taxes paid during the
7    period beginning July 1, 2003 and ending on August 16,
8    2013 (the effective date of Public Act 98-456).
9        (22) Until June 30, 2013, fuel and petroleum products
10    sold to or used by an air carrier, certified by the carrier
11    to be used for consumption, shipment, or storage in the
12    conduct of its business as an air common carrier, for a
13    flight destined for or returning from a location or
14    locations outside the United States without regard to
15    previous or subsequent domestic stopovers.
16        Beginning July 1, 2013, fuel and petroleum products
17    sold to or used by an air carrier, certified by the carrier
18    to be used for consumption, shipment, or storage in the
19    conduct of its business as an air common carrier, for a
20    flight that (i) is engaged in foreign trade or is engaged
21    in trade between the United States and any of its
22    possessions and (ii) transports at least one individual or
23    package for hire from the city of origination to the city
24    of final destination on the same aircraft, without regard
25    to a change in the flight number of that aircraft.
26        (23) A transaction in which the purchase order is

 

 

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1    received by a florist who is located outside Illinois, but
2    who has a florist located in Illinois deliver the property
3    to the purchaser or the purchaser's donee in Illinois.
4        (24) Fuel consumed or used in the operation of ships,
5    barges, or vessels that are used primarily in or for the
6    transportation of property or the conveyance of persons
7    for hire on rivers bordering on this State if the fuel is
8    delivered by the seller to the purchaser's barge, ship, or
9    vessel while it is afloat upon that bordering river.
10        (25) Except as provided in item (25-5) of this
11    Section, a motor vehicle sold in this State to a
12    nonresident even though the motor vehicle is delivered to
13    the nonresident in this State, if the motor vehicle is not
14    to be titled in this State, and if a drive-away permit is
15    issued to the motor vehicle as provided in Section 3-603
16    of the Illinois Vehicle Code or if the nonresident
17    purchaser has vehicle registration plates to transfer to
18    the motor vehicle upon returning to his or her home state.
19    The issuance of the drive-away permit or having the
20    out-of-state registration plates to be transferred is
21    prima facie evidence that the motor vehicle will not be
22    titled in this State.
23        (25-5) The exemption under item (25) does not apply if
24    the state in which the motor vehicle will be titled does
25    not allow a reciprocal exemption for a motor vehicle sold
26    and delivered in that state to an Illinois resident but

 

 

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1    titled in Illinois. The tax collected under this Act on
2    the sale of a motor vehicle in this State to a resident of
3    another state that does not allow a reciprocal exemption
4    shall be imposed at a rate equal to the state's rate of tax
5    on taxable property in the state in which the purchaser is
6    a resident, except that the tax shall not exceed the tax
7    that would otherwise be imposed under this Act. At the
8    time of the sale, the purchaser shall execute a statement,
9    signed under penalty of perjury, of his or her intent to
10    title the vehicle in the state in which the purchaser is a
11    resident within 30 days after the sale and of the fact of
12    the payment to the State of Illinois of tax in an amount
13    equivalent to the state's rate of tax on taxable property
14    in his or her state of residence and shall submit the
15    statement to the appropriate tax collection agency in his
16    or her state of residence. In addition, the retailer must
17    retain a signed copy of the statement in his or her
18    records. Nothing in this item shall be construed to
19    require the removal of the vehicle from this state
20    following the filing of an intent to title the vehicle in
21    the purchaser's state of residence if the purchaser titles
22    the vehicle in his or her state of residence within 30 days
23    after the date of sale. The tax collected under this Act in
24    accordance with this item (25-5) shall be proportionately
25    distributed as if the tax were collected at the 6.25%
26    general rate imposed under this Act.

 

 

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1        (25-7) Beginning on July 1, 2007, no tax is imposed
2    under this Act on the sale of an aircraft, as defined in
3    Section 3 of the Illinois Aeronautics Act, if all of the
4    following conditions are met:
5            (1) the aircraft leaves this State within 15 days
6        after the later of either the issuance of the final
7        billing for the sale of the aircraft, or the
8        authorized approval for return to service, completion
9        of the maintenance record entry, and completion of the
10        test flight and ground test for inspection, as
11        required by 14 C.F.R. 91.407;
12            (2) the aircraft is not based or registered in
13        this State after the sale of the aircraft; and
14            (3) the seller retains in his or her books and
15        records and provides to the Department a signed and
16        dated certification from the purchaser, on a form
17        prescribed by the Department, certifying that the
18        requirements of this item (25-7) are met. The
19        certificate must also include the name and address of
20        the purchaser, the address of the location where the
21        aircraft is to be titled or registered, the address of
22        the primary physical location of the aircraft, and
23        other information that the Department may reasonably
24        require.
25        For purposes of this item (25-7):
26        "Based in this State" means hangared, stored, or

 

 

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1    otherwise used, excluding post-sale customizations as
2    defined in this Section, for 10 or more days in each
3    12-month period immediately following the date of the sale
4    of the aircraft.
5        "Registered in this State" means an aircraft
6    registered with the Department of Transportation,
7    Aeronautics Division, or titled or registered with the
8    Federal Aviation Administration to an address located in
9    this State.
10        This paragraph (25-7) is exempt from the provisions of
11    Section 2-70.
12        (26) Semen used for artificial insemination of
13    livestock for direct agricultural production.
14        (27) Horses, or interests in horses, registered with
15    and meeting the requirements of any of the Arabian Horse
16    Club Registry of America, Appaloosa Horse Club, American
17    Quarter Horse Association, United States Trotting
18    Association, or Jockey Club, as appropriate, used for
19    purposes of breeding or racing for prizes. This item (27)
20    is exempt from the provisions of Section 2-70, and the
21    exemption provided for under this item (27) applies for
22    all periods beginning May 30, 1995, but no claim for
23    credit or refund is allowed on or after January 1, 2008
24    (the effective date of Public Act 95-88) for such taxes
25    paid during the period beginning May 30, 2000 and ending
26    on January 1, 2008 (the effective date of Public Act

 

 

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

 

 

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

 

 

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1    all tax-supported public schools, private schools that
2    offer systematic instruction in useful branches of
3    learning by methods common to public schools and that
4    compare favorably in their scope and intensity with the
5    course of study presented in tax-supported schools, and
6    vocational or technical schools or institutes organized
7    and operated exclusively to provide a course of study of
8    not less than 6 weeks duration and designed to prepare
9    individuals to follow a trade or to pursue a manual,
10    technical, mechanical, industrial, business, or commercial
11    occupation.
12        (34) Beginning January 1, 2000, personal property,
13    including food, purchased through fundraising events for
14    the benefit of a public or private elementary or secondary
15    school, a group of those schools, or one or more school
16    districts if the events are sponsored by an entity
17    recognized by the school district that consists primarily
18    of volunteers and includes parents and teachers of the
19    school children. This paragraph does not apply to
20    fundraising events (i) for the benefit of private home
21    instruction or (ii) for which the fundraising entity
22    purchases the personal property sold at the events from
23    another individual or entity that sold the property for
24    the purpose of resale by the fundraising entity and that
25    profits from the sale to the fundraising entity. This
26    paragraph is exempt from the provisions of Section 2-70.

 

 

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1        (35) Beginning January 1, 2000 and through December
2    31, 2001, new or used automatic vending machines that
3    prepare and serve hot food and beverages, including
4    coffee, soup, and other items, and replacement parts for
5    these machines. Beginning January 1, 2002 and through June
6    30, 2003, machines and parts for machines used in
7    commercial, coin-operated amusement and vending business
8    if a use or occupation tax is paid on the gross receipts
9    derived from the use of the commercial, coin-operated
10    amusement and vending machines. This paragraph is exempt
11    from the provisions of Section 2-70.
12        (35-5) Beginning August 23, 2001 and through June 30,
13    2016, food for human consumption that is to be consumed
14    off the premises where it is sold (other than alcoholic
15    beverages, soft drinks, and food that has been prepared
16    for immediate consumption) and prescription and
17    nonprescription medicines, drugs, medical appliances, and
18    insulin, urine testing materials, syringes, and needles
19    used by diabetics, for human use, when purchased for use
20    by a person receiving medical assistance under Article V
21    of the Illinois Public Aid Code who resides in a licensed
22    long-term care facility, as defined in the Nursing Home
23    Care Act, or a licensed facility as defined in the ID/DD
24    Community Care Act, the MC/DD Act, or the Specialized
25    Mental Health Rehabilitation Act of 2013.
26        (36) Beginning August 2, 2001, computers and

 

 

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1    communications equipment utilized for any hospital purpose
2    and equipment used in the diagnosis, analysis, or
3    treatment of hospital patients sold to a lessor who leases
4    the equipment, under a lease of one year or longer
5    executed or in effect at the time of the purchase, to a
6    hospital that has been issued an active tax exemption
7    identification number by the Department under Section 1g
8    of this Act. This paragraph is exempt from the provisions
9    of Section 2-70.
10        (37) Beginning August 2, 2001, personal property sold
11    to a lessor who leases the property, under a lease of one
12    year or longer executed or in effect at the time of the
13    purchase, to a governmental body that has been issued an
14    active tax exemption identification number by the
15    Department under Section 1g of this Act. This paragraph is
16    exempt from the provisions of Section 2-70.
17        (38) Beginning on January 1, 2002 and through June 30,
18    2016, tangible personal property purchased from an
19    Illinois retailer by a taxpayer engaged in centralized
20    purchasing activities in Illinois who will, upon receipt
21    of the property in Illinois, temporarily store the
22    property in Illinois (i) for the purpose of subsequently
23    transporting it outside this State for use or consumption
24    thereafter solely outside this State or (ii) for the
25    purpose of being processed, fabricated, or manufactured
26    into, attached to, or incorporated into other tangible

 

 

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1    personal property to be transported outside this State and
2    thereafter used or consumed solely outside this State. The
3    Director of Revenue shall, pursuant to rules adopted in
4    accordance with the Illinois Administrative Procedure Act,
5    issue a permit to any taxpayer in good standing with the
6    Department who is eligible for the exemption under this
7    paragraph (38). The permit issued under this paragraph
8    (38) shall authorize the holder, to the extent and in the
9    manner specified in the rules adopted under this Act, to
10    purchase tangible personal property from a retailer exempt
11    from the taxes imposed by this Act. Taxpayers shall
12    maintain all necessary books and records to substantiate
13    the use and consumption of all such tangible personal
14    property outside of the State of Illinois.
15        (39) Beginning January 1, 2008, tangible personal
16    property used in the construction or maintenance of a
17    community water supply, as defined under Section 3.145 of
18    the Environmental Protection Act, that is operated by a
19    not-for-profit corporation that holds a valid water supply
20    permit issued under Title IV of the Environmental
21    Protection Act. This paragraph is exempt from the
22    provisions of Section 2-70.
23        (40) Beginning January 1, 2010 and continuing through
24    December 31, 2024, materials, parts, equipment,
25    components, and furnishings incorporated into or upon an
26    aircraft as part of the modification, refurbishment,

 

 

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1    completion, replacement, repair, or maintenance of the
2    aircraft. This exemption includes consumable supplies used
3    in the modification, refurbishment, completion,
4    replacement, repair, and maintenance of aircraft, but
5    excludes any materials, parts, equipment, components, and
6    consumable supplies used in the modification, replacement,
7    repair, and maintenance of aircraft engines or power
8    plants, whether such engines or power plants are installed
9    or uninstalled upon any such aircraft. "Consumable
10    supplies" include, but are not limited to, adhesive, tape,
11    sandpaper, general purpose lubricants, cleaning solution,
12    latex gloves, and protective films. This exemption applies
13    only to the sale of qualifying tangible personal property
14    to persons who modify, refurbish, complete, replace, or
15    maintain an aircraft and who (i) hold an Air Agency
16    Certificate and are empowered to operate an approved
17    repair station by the Federal Aviation Administration,
18    (ii) have a Class IV Rating, and (iii) conduct operations
19    in accordance with Part 145 of the Federal Aviation
20    Regulations. The exemption does not include aircraft
21    operated by a commercial air carrier providing scheduled
22    passenger air service pursuant to authority issued under
23    Part 121 or Part 129 of the Federal Aviation Regulations.
24    The changes made to this paragraph (40) by Public Act
25    98-534 are declarative of existing law. It is the intent
26    of the General Assembly that the exemption under this

 

 

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1    paragraph (40) applies continuously from January 1, 2010
2    through December 31, 2024; however, no claim for credit or
3    refund is allowed for taxes paid as a result of the
4    disallowance of this exemption on or after January 1, 2015
5    and prior to the effective date of this amendatory Act of
6    the 101st General Assembly.
7        (41) Tangible personal property sold to a
8    public-facilities corporation, as described in Section
9    11-65-10 of the Illinois Municipal Code, for purposes of
10    constructing or furnishing a municipal convention hall,
11    but only if the legal title to the municipal convention
12    hall is transferred to the municipality without any
13    further consideration by or on behalf of the municipality
14    at the time of the completion of the municipal convention
15    hall or upon the retirement or redemption of any bonds or
16    other debt instruments issued by the public-facilities
17    corporation in connection with the development of the
18    municipal convention hall. This exemption includes
19    existing public-facilities corporations as provided in
20    Section 11-65-25 of the Illinois Municipal Code. This
21    paragraph is exempt from the provisions of Section 2-70.
22        (42) Beginning January 1, 2017 and through December
23    31, 2026, menstrual pads, tampons, and menstrual cups.
24        (43) Merchandise that is subject to the Rental
25    Purchase Agreement Occupation and Use Tax. The purchaser
26    must certify that the item is purchased to be rented

 

 

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1    subject to a rental purchase agreement, as defined in the
2    Rental Purchase Agreement Act, and provide proof of
3    registration under the Rental Purchase Agreement
4    Occupation and Use Tax Act. This paragraph is exempt from
5    the provisions of Section 2-70.
6        (44) Qualified tangible personal property used in the
7    construction or operation of a data center that has been
8    granted a certificate of exemption by the Department of
9    Commerce and Economic Opportunity, whether that tangible
10    personal property is purchased by the owner, operator, or
11    tenant of the data center or by a contractor or
12    subcontractor of the owner, operator, or tenant. Data
13    centers that would have qualified for a certificate of
14    exemption prior to January 1, 2020 had this amendatory Act
15    of the 101st General Assembly been in effect, may apply
16    for and obtain an exemption for subsequent purchases of
17    computer equipment or enabling software purchased or
18    leased to upgrade, supplement, or replace computer
19    equipment or enabling software purchased or leased in the
20    original investment that would have qualified.
21        The Department of Commerce and Economic Opportunity
22    shall grant a certificate of exemption under this item
23    (44) to qualified data centers as defined by Section
24    605-1025 of the Department of Commerce and Economic
25    Opportunity Law of the Civil Administrative Code of
26    Illinois.

 

 

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1        For the purposes of this item (44):
2            "Data center" means a building or a series of
3        buildings rehabilitated or constructed to house
4        working servers in one physical location or multiple
5        sites within the State of Illinois.
6            "Qualified tangible personal property" means:
7        electrical systems and equipment; climate control and
8        chilling equipment and systems; mechanical systems and
9        equipment; monitoring and secure systems; emergency
10        generators; hardware; computers; servers; data storage
11        devices; network connectivity equipment; racks;
12        cabinets; telecommunications cabling infrastructure;
13        raised floor systems; peripheral components or
14        systems; software; mechanical, electrical, or plumbing
15        systems; battery systems; cooling systems and towers;
16        temperature control systems; other cabling; and other
17        data center infrastructure equipment and systems
18        necessary to operate qualified tangible personal
19        property, including fixtures; and component parts of
20        any of the foregoing, including installation,
21        maintenance, repair, refurbishment, and replacement of
22        qualified tangible personal property to generate,
23        transform, transmit, distribute, or manage electricity
24        necessary to operate qualified tangible personal
25        property; and all other tangible personal property
26        that is essential to the operations of a computer data

 

 

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1        center. The term "qualified tangible personal
2        property" also includes building materials physically
3        incorporated into in to the qualifying data center. To
4        document the exemption allowed under this Section, the
5        retailer must obtain from the purchaser a copy of the
6        certificate of eligibility issued by the Department of
7        Commerce and Economic Opportunity.
8        This item (44) is exempt from the provisions of
9    Section 2-70.
10        (45) Beginning January 1, 2020 and through December
11    31, 2020, sales of tangible personal property made by a
12    marketplace seller over a marketplace for which tax is due
13    under this Act but for which use tax has been collected and
14    remitted to the Department by a marketplace facilitator
15    under Section 2d of the Use Tax Act are exempt from tax
16    under this Act. A marketplace seller claiming this
17    exemption shall maintain books and records demonstrating
18    that the use tax on such sales has been collected and
19    remitted by a marketplace facilitator. Marketplace sellers
20    that have properly remitted tax under this Act on such
21    sales may file a claim for credit as provided in Section 6
22    of this Act. No claim is allowed, however, for such taxes
23    for which a credit or refund has been issued to the
24    marketplace facilitator under the Use Tax Act, or for
25    which the marketplace facilitator has filed a claim for
26    credit or refund under the Use Tax Act.

 

 

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1        (45) Tangible personal property for which a
2    certificate of exemption has been issued under Section
3    2505-805 of the Department of Revenue Law of the Civil
4    Administrative Code of Illinois. This paragraph is exempt
5    from the provisions of Section 2-70.
6(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
7101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-634, eff.
88-27-21; revised 11-9-21.)
 
9    Section 30. The Counties Code is amended by adding Section
105-1188 as follows:
 
11    (55 ILCS 5/5-1188 new)
12    Sec. 5-1188. Exemption for materials, equipment, or
13supplies of a bid. Tangible personal property for which a
14certificate of exemption has been issued under Section
152505-805 of the Department of Revenue Law of the Civil
16Administrative Code of Illinois is exempt from any use or
17occupation tax imposed by a county under this Code.
 
18    Section 35. The Illinois Municipal Code is amended by
19adding Section 8-1-19 as follows:
 
20    (65 ILCS 5/8-1-19 new)
21    Sec. 8-1-19. Exemption for materials, equipment, or
22supplies of a bid. Tangible personal property for which a

 

 

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1certificate of exemption has been issued under Section
22505-805 of the Department of Revenue Law of the Civil
3Administrative Code of Illinois is exempt from any use or
4occupation tax imposed by a municipality under this Code.
 
5    Section 40. The Civic Center Code is amended by adding
6Section 245-13 as follows:
 
7    (70 ILCS 200/245-13 new)
8    Sec. 245-13. Exemption for materials, equipment, or
9supplies of a bid. Tangible personal property for which a
10certificate of exemption has been issued under Section
112505-805 of the Department of Revenue Law of the Civil
12Administrative Code of Illinois is exempt from any use or
13occupation tax imposed under this Article.
 
14    Section 45. The Metropolitan Pier and Exposition Authority
15Act is amended by adding Section 13.4 as follows:
 
16    (70 ILCS 210/13.4 new)
17    Sec. 13.4. Exemption for materials, equipment, or supplies
18of a bid. Tangible personal property for which a certificate
19of exemption has been issued under Section 2505-805 of the
20Department of Revenue Law of the Civil Administrative Code of
21Illinois is exempt from any use or occupation tax imposed
22under this Act.
 

 

 

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1    Section 50. The Flood Prevention District Act is amended
2by adding Section 27 as follows:
 
3    (70 ILCS 750/27 new)
4    Sec. 27. Exemption for materials, equipment, or supplies
5of a bid. Tangible personal property for which a certificate
6of exemption has been issued under Section 2505-805 of the
7Department of Revenue Law of the Civil Administrative Code of
8Illinois is exempt from any use or occupation tax imposed
9under this Act.
 
10    Section 55. The Metro-East Park and Recreation District
11Act is amended by adding Section 32 as follows:
 
12    (70 ILCS 1605/32 new)
13    Sec. 32. Exemption for materials, equipment, or supplies
14of a bid. Tangible personal property for which a certificate
15of exemption has been issued under Section 2505-805 of the
16Department of Revenue Law of the Civil Administrative Code of
17Illinois is exempt from any use or occupation tax imposed
18under this Act.
 
19    Section 60. The Local Mass Transit District Act is amended
20by adding Section 5.7 as follows:
 

 

 

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1    (70 ILCS 3610/5.7 new)
2    Sec. 5.7. Exemption for materials, equipment, or supplies
3of a bid. Tangible personal property for which a certificate
4of exemption has been issued under Section 2505-805 of the
5Department of Revenue Law of the Civil Administrative Code of
6Illinois is exempt from any use or occupation tax imposed
7under this Act.
 
8    Section 65. The Regional Transportation Authority Act is
9amended by adding Section 4.17 as follows:
 
10    (70 ILCS 3615/4.17 new)
11    Sec. 4.17. Exemption for materials, equipment, or supplies
12of a bid. Tangible personal property for which a certificate
13of exemption has been issued under Section 2505-805 of the
14Department of Revenue Law of the Civil Administrative Code of
15Illinois is exempt from any use or occupation tax imposed
16under this Act.
 
17    Section 70. The Water Commission Act of 1985 is amended by
18adding Section 4.5 as follows:
 
19    (70 ILCS 3720/4.5 new)
20    Sec. 4.5. Exemption for materials, equipment, or supplies
21of a bid. Tangible personal property for which a certificate
22of exemption has been issued under Section 2505-805 of the

 

 

HB5040- 85 -LRB102 23725 HLH 32914 b

1Department of Revenue Law of the Civil Administrative Code of
2Illinois is exempt from any use or occupation tax imposed
3under this Act.
 
4    Section 99. Effective date. This Act takes effect upon
5becoming law.

 

 

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1 INDEX
2 Statutes amended in order of appearance
3    20 ILCS 2505/2505-805 new
4    35 ILCS 105/3-5
5    35 ILCS 110/3-5
6    35 ILCS 115/3-5
7    35 ILCS 120/2-5
8    55 ILCS 5/5-1188 new
9    65 ILCS 5/8-1-19 new
10    70 ILCS 200/245-13 new
11    70 ILCS 210/13.4 new
12    70 ILCS 750/27 new
13    70 ILCS 1605/32 new
14    70 ILCS 3610/5.7 new
15    70 ILCS 3615/4.17 new
16    70 ILCS 3720/4.5 new