093_SB1101ham001

 










                                     LRB093 07190 SJM 15372 a

 1                    AMENDMENT TO SENATE BILL 1101

 2        AMENDMENT NO.     .  Amend Senate Bill 1101 on page 1, by
 3    replacing lines 4 and 5 with the following:

 4        "Section 5.  The Telecommunications  Excise  Tax  Act  is
 5    amended by changing Section 2 as follows:

 6        (35 ILCS 630/2) (from Ch. 120, par. 2002)
 7        (Text of Section before amendment by P.A. 92-878)
 8        Sec.  2.   As  used  in  this Article, unless the context
 9    clearly requires otherwise:
10        (a)  "Gross charge" means the amount paid for the act  or
11    privilege  of  originating or receiving telecommunications in
12    this State and for all services  and  equipment  provided  in
13    connection  therewith  by a retailer, valued in money whether
14    paid in money or otherwise, including cash, credits, services
15    and property of every kind or nature, and shall be determined
16    without  any  deduction  on  account  of  the  cost  of  such
17    telecommunications, the cost  of  materials  used,  labor  or
18    service  costs  or  any  other  expense  whatsoever.  In case
19    credit is extended, the amount thereof shall be included only
20    as and when paid. "Gross charges" for  private  line  service
21    shall  include  charges  imposed at each channel point within
22    this State, charges for  the  channel  mileage  between  each
 
                            -2-      LRB093 07190 SJM 15372 a
 1    channel point within this State, and charges for that portion
 2    of   the  interstate  inter-office  channel  provided  within
 3    Illinois. However, "gross charges" shall not include:
 4             (1)  any amounts added to a purchaser's bill because
 5        of a charge made pursuant to (i) the tax imposed by  this
 6        Article;  (ii) charges added to customers' bills pursuant
 7        to the provisions of  Sections  9-221  or  9-222  of  the
 8        Public  Utilities Act, as amended, or any similar charges
 9        added to  customers'  bills  by  retailers  who  are  not
10        subject  to  rate  regulation  by  the  Illinois Commerce
11        Commission for the purpose of recovering any of  the  tax
12        liabilities or other amounts specified in such provisions
13        of such Act; (iii) the tax imposed by Section 4251 of the
14        Internal  Revenue  Code;  (iv) 911 surcharges; or (v) the
15        tax    imposed    by     the     Simplified     Municipal
16        Telecommunications Tax Act;
17             (2)  charges  for  a  sent collect telecommunication
18        received outside of the State;
19             (3)  charges for leased time on equipment or charges
20        for the storage of data  or  information  for  subsequent
21        retrieval  or  the  processing  of  data  or  information
22        intended  to  change its form or content.  Such equipment
23        includes, but is not limited to, the use of  calculators,
24        computers,    data   processing   equipment,   tabulating
25        equipment or accounting equipment and also  includes  the
26        usage of computers under a time-sharing agreement;
27             (4)  charges  for customer equipment, including such
28        equipment that is leased or rented by the  customer  from
29        any  source,  wherein  such charges are disaggregated and
30        separately identified from other charges;
31             (5)  charges to business enterprises certified under
32        Section 9-222.1 of the Public Utilities Act, as  amended,
33        to  the extent of such exemption and during the period of
34        time  specified  by  the  Department  of   Commerce   and
 
                            -3-      LRB093 07190 SJM 15372 a
 1        Community Affairs;
 2             (6)  charges for telecommunications and all services
 3        and  equipment provided in connection therewith between a
 4        parent corporation and its wholly owned  subsidiaries  or
 5        between  wholly  owned  subsidiaries when the tax imposed
 6        under this Article has already been paid  to  a  retailer
 7        and  only  to  the  extent  that  the charges between the
 8        parent  corporation  and  wholly  owned  subsidiaries  or
 9        between  wholly  owned  subsidiaries  represent   expense
10        allocation   between   the   corporations   and  not  the
11        generation of profit for the corporation  rendering  such
12        service;
13             (7)  bad debts. Bad debt means any portion of a debt
14        that  is  related  to  a  sale  at retail for which gross
15        charges are not otherwise deductible or  excludable  that
16        has  become  worthless  or  uncollectable,  as determined
17        under applicable federal income tax  standards.   If  the
18        portion  of  the  debt  deemed  to be bad is subsequently
19        paid, the retailer shall report and pay the tax  on  that
20        portion  during the reporting period in which the payment
21        is made;
22             (8)  charges   paid   by    inserting    coins    in
23        coin-operated telecommunication devices;
24             (9)  amounts  paid  by  telecommunications retailers
25        under  the  Telecommunications  Municipal  Infrastructure
26        Maintenance Fee Act.
27        (b)  "Amount  paid"  means  the  amount  charged  to  the
28    taxpayer's service address in this State regardless of  where
29    such amount is billed or paid.
30        (c)  "Telecommunications",  in  addition  to  the meaning
31    ordinarily and popularly ascribed to  it,  includes,  without
32    limitation,  messages  or information transmitted through use
33    of local, toll and wide area telephone service; private  line
34    services;     channel     services;    telegraph    services;
 
                            -4-      LRB093 07190 SJM 15372 a
 1    teletypewriter; computer exchange services;  cellular  mobile
 2    telecommunications   service;   specialized   mobile   radio;
 3    stationary  two  way radio; paging service; or any other form
 4    of mobile and portable one-way or two-way communications;  or
 5    any   other   transmission  of  messages  or  information  by
 6    electronic or similar means, between or among points by wire,
 7    cable, fiber-optics, laser, microwave,  radio,  satellite  or
 8    similar  facilities.   As  used  in  this Act, "private line"
 9    means a dedicated non-traffic sensitive service for a  single
10    customer, that entitles the customer to exclusive or priority
11    use  of  a  communications channel or group of channels, from
12    one  or  more  specified  locations  to  one  or  more  other
13    specified locations.  The definition of  "telecommunications"
14    shall  not  include  value  added  services in which computer
15    processing applications are used to act on the form, content,
16    code and protocol of the information for purposes other  than
17    transmission.    "Telecommunications"   shall   not   include
18    purchases   of  telecommunications  by  a  telecommunications
19    service provider for use as a component part of  the  service
20    provided   by   him  to  the  ultimate  retail  consumer  who
21    originates   or    terminates    the    taxable    end-to-end
22    communications.   Carrier  access  charges,  right  of access
23    charges, charges for use of inter-company facilities, and all
24    telecommunications resold in  the  subsequent  provision  of,
25    used  as  a  component  of,  or  integrated  into  end-to-end
26    telecommunications  service shall be non-taxable as sales for
27    resale.
28        (d)  "Interstate    telecommunications"     means     all
29    telecommunications that either originate or terminate outside
30    this State.
31        (e)  "Intrastate     telecommunications"     means    all
32    telecommunications that originate and terminate  within  this
33    State.
34        (f)  "Department"  means the Department of Revenue of the
 
                            -5-      LRB093 07190 SJM 15372 a
 1    State of Illinois.
 2        (g)  "Director" means the Director  of  Revenue  for  the
 3    Department of Revenue of the State of Illinois.
 4        (h)  "Taxpayer"   means  a  person  who  individually  or
 5    through his agents, employees or permittees  engages  in  the
 6    act    or    privilege    of    originating    or   receiving
 7    telecommunications  in  this  State  and  who  incurs  a  tax
 8    liability under this Article.
 9        (i)  "Person" means any natural individual, firm,  trust,
10    estate,  partnership, association, joint stock company, joint
11    venture,  corporation,  limited  liability  company,   or   a
12    receiver, trustee, guardian or other representative appointed
13    by  order  of  any  court, the Federal and State governments,
14    including State universities created by statute or any  city,
15    town, county or other political subdivision of this State.
16        (j)  "Purchase   at   retail"   means   the  acquisition,
17    consumption or use of telecommunication  through  a  sale  at
18    retail.
19        (k)  "Sale  at  retail" means the transmitting, supplying
20    or furnishing of  telecommunications  and  all  services  and
21    equipment    provided   in   connection   therewith   for   a
22    consideration to persons other than  the  Federal  and  State
23    governments,  and  State  universities created by statute and
24    other than between a parent corporation and its wholly  owned
25    subsidiaries  or  between wholly owned subsidiaries for their
26    use or consumption and not for resale.
27        (l)  "Retailer" means and includes every  person  engaged
28    in  the business of making sales at retail as defined in this
29    Article.   The  Department  may,  in  its  discretion,   upon
30    application,  authorize  the  collection  of  the  tax hereby
31    imposed by any retailer not maintaining a place  of  business
32    within   this   State,   who,  to  the  satisfaction  of  the
33    Department, furnishes adequate security to insure  collection
34    and  payment  of  the  tax.   Such  retailer shall be issued,
 
                            -6-      LRB093 07190 SJM 15372 a
 1    without charge, a  permit  to  collect  such  tax.   When  so
 2    authorized,  it shall be the duty of such retailer to collect
 3    the tax upon all of the gross charges for  telecommunications
 4    in  this  State  in  the  same manner and subject to the same
 5    requirements as a retailer maintaining a  place  of  business
 6    within  this  State.   The  permit  may  be  revoked  by  the
 7    Department at its discretion.
 8        (m)  "Retailer  maintaining  a  place of business in this
 9    State", or any like term, means  and  includes  any  retailer
10    having  or  maintaining  within  this State, directly or by a
11    subsidiary, an office, distribution facilities,  transmission
12    facilities,   sales  office,  warehouse  or  other  place  of
13    business, or any  agent  or  other  representative  operating
14    within  this State under the authority of the retailer or its
15    subsidiary, irrespective of whether such place of business or
16    agent or other representative is located here permanently  or
17    temporarily,  or  whether  such  retailer  or  subsidiary  is
18    licensed to do business in this State.
19        (n)  "Service    address"    means    the   location   of
20    telecommunications      equipment     from     which      the
21    telecommunications   services  are  originated  or  at  which
22    telecommunications services are received by a  taxpayer.   In
23    the  event this may not be a defined location, as in the case
24    of mobile phones, paging systems, maritime  systems,  service
25    address  means the customer's place of primary use as defined
26    in the Mobile  Telecommunications  Sourcing  Conformity  Act.
27    For air-to-ground systems and the like, service address shall
28    mean  the  location  of  a  taxpayer's  primary  use  of  the
29    telecommunications  equipment as defined by telephone number,
30    authorization code, or location in Illinois where  bills  are
31    sent.
32        (o)  "Prepaid  telephone  calling  arrangements" mean the
33    right to exclusively purchase telephone or telecommunications
34    services that must be paid for  in  advance  and  enable  the
 
                            -7-      LRB093 07190 SJM 15372 a
 1    origination   of  one  or  more  intrastate,  interstate,  or
 2    international telephone  calls  or  other  telecommunications
 3    using  an  access  number,  an  authorization  code, or both,
 4    whether manually or electronically dialed, for which  payment
 5    to  a retailer must be made in advance, provided that, unless
 6    recharged, no further service is provided once  that  prepaid
 7    amount  of  service  has  been  consumed.   Prepaid telephone
 8    calling  arrangements  include  the  recharge  of  a  prepaid
 9    calling  arrangement.   For  purposes  of  this   subsection,
10    "recharge" means the purchase of additional prepaid telephone
11    or  telecommunications  services whether or not the purchaser
12    acquires a different access  number  or  authorization  code.
13    "Prepaid  telephone  calling arrangement" does not include an
14    arrangement whereby a customer purchases a payment  card  and
15    pursuant to which the service provider reflects the amount of
16    such  purchase  as  a  credit  on  an  invoice issued to that
17    customer under an existing subscription plan.
18    (Source: P.A. 91-870,  eff.  6-22-00;  92-474,  eff.  8-1-02;
19    92-526, eff. 1-1-03.)

20        (Text of Section after amendment by P.A. 92-878)
21        Sec.  2.   As  used  in  this Article, unless the context
22    clearly requires otherwise:
23        (a)  "Gross charge" means the amount paid for the act  or
24    privilege  of  originating or receiving telecommunications in
25    this State and for all services  and  equipment  provided  in
26    connection  therewith  by a retailer, valued in money whether
27    paid in money or otherwise, including cash, credits, services
28    and property of every kind or nature, and shall be determined
29    without  any  deduction  on  account  of  the  cost  of  such
30    telecommunications, the cost  of  materials  used,  labor  or
31    service  costs  or  any  other  expense  whatsoever.  In case
32    credit is extended, the amount thereof shall be included only
33    as and when paid. "Gross charges" for  private  line  service
34    shall  include  charges  imposed  at each channel termination
 
                            -8-      LRB093 07190 SJM 15372 a
 1    point within this State,  charges  for  the  channel  mileage
 2    between each channel termination point within this State, and
 3    charges  for  that  portion  of  the  interstate inter-office
 4    channel provided within Illinois. Charges for that portion of
 5    the interstate  inter-office  channel  provided  in  Illinois
 6    shall  be  determined  by  the  retailer as follows:  (i) for
 7    interstate inter-office channels having 2 channel termination
 8    points, only one of which is in Illinois, 50%  of  the  total
 9    charge  imposed; or (ii) for interstate inter-office channels
10    having more than 2 channel termination points, one or more of
11    which are in Illinois, an amount equal to  the  total  charge
12    multiplied  by  a  fraction,  the  numerator  of which is the
13    number of channel termination points within Illinois and  the
14    denominator   of   which  is  the  total  number  of  channel
15    termination points; or (iii) any other method that reasonably
16    apportions the  total  charges  for  interstate  inter-office
17    channels among the states in which channel termination points
18    are  located.  Prior  to  January  1,  2004 June 1, 2003, any
19    apportionment method consistent with this paragraph or  other
20    method  that  reasonably  apportions  the  total  charges for
21    interstate inter-office channels among the  states  in  which
22    channel  terminations points are located shall be accepted as
23    a reasonable method to determine the charges for that portion
24    of  the  interstate  inter-office  channel  provided   within
25    Illinois for that period.  However, "gross charges" shall not
26    include any of the following:
27             (1)  Any amounts added to a purchaser's bill because
28        of  a charge made pursuant to (i) the tax imposed by this
29        Article; (ii) charges added to customers' bills  pursuant
30        to  the  provisions  of  Sections  9-221  or 9-222 of the
31        Public Utilities Act, as amended, or any similar  charges
32        added  to  customers'  bills  by  retailers  who  are not
33        subject to  rate  regulation  by  the  Illinois  Commerce
34        Commission  for  the purpose of recovering any of the tax
 
                            -9-      LRB093 07190 SJM 15372 a
 1        liabilities or other amounts specified in such provisions
 2        of such Act; (iii) the tax imposed by Section 4251 of the
 3        Internal Revenue Code; (iv) 911 surcharges;  or  (v)  the
 4        tax     imposed     by     the    Simplified    Municipal
 5        Telecommunications Tax Act.
 6             (2)  Charges for a  sent  collect  telecommunication
 7        received outside of the State.
 8             (3)  Charges for leased time on equipment or charges
 9        for  the  storage  of  data or information for subsequent
10        retrieval  or  the  processing  of  data  or  information
11        intended to change its form or content.   Such  equipment
12        includes,  but is not limited to, the use of calculators,
13        computers,   data   processing   equipment,    tabulating
14        equipment  or  accounting equipment and also includes the
15        usage of computers under a time-sharing agreement.
16             (4)  Charges for customer equipment, including  such
17        equipment  that  is leased or rented by the customer from
18        any source, wherein such charges  are  disaggregated  and
19        separately identified from other charges.
20             (5)  Charges to business enterprises certified under
21        Section  9-222.1 of the Public Utilities Act, as amended,
22        to the extent of such exemption and during the period  of
23        time   specified   by  the  Department  of  Commerce  and
24        Community Affairs.
25             (6)  Charges for telecommunications and all services
26        and equipment provided in connection therewith between  a
27        parent  corporation  and its wholly owned subsidiaries or
28        between wholly owned subsidiaries when  the  tax  imposed
29        under  this  Article  has already been paid to a retailer
30        and only to the  extent  that  the  charges  between  the
31        parent  corporation  and  wholly  owned  subsidiaries  or
32        between   wholly  owned  subsidiaries  represent  expense
33        allocation  between  the   corporations   and   not   the
34        generation  of  profit for the corporation rendering such
 
                            -10-     LRB093 07190 SJM 15372 a
 1        service.
 2             (7)  Bad debts. Bad debt means any portion of a debt
 3        that is related to a  sale  at  retail  for  which  gross
 4        charges  are  not otherwise deductible or excludable that
 5        has become  worthless  or  uncollectable,  as  determined
 6        under  applicable  federal  income tax standards.  If the
 7        portion of the debt deemed  to  be  bad  is  subsequently
 8        paid,  the  retailer shall report and pay the tax on that
 9        portion during the reporting period in which the  payment
10        is made.
11             (8)  Charges    paid    by    inserting   coins   in
12        coin-operated telecommunication devices.
13             (9)  Amounts paid  by  telecommunications  retailers
14        under  the  Telecommunications  Municipal  Infrastructure
15        Maintenance Fee Act.
16             (10)  Charges    for    nontaxable    services    or
17        telecommunications  if  (i)  those charges are aggregated
18        with  other  charges  for  telecommunications  that   are
19        taxable,  (ii) those charges are not separately stated on
20        the customer bill or invoice, and (iii) the retailer  can
21        reasonably   identify   the  nontaxable  charges  on  the
22        retailer's books and records kept in the  regular  course
23        of  business. If the nontaxable charges cannot reasonably
24        be identified, the gross charge from  the  sale  of  both
25        taxable  and  nontaxable  services  or telecommunications
26        billed on a combined basis shall  be  attributed  to  the
27        taxable  services  or  telecommunications.  The burden of
28        proving nontaxable charges shall be on  the  retailer  of
29        the telecommunications.
30        (b)  "Amount  paid"  means  the  amount  charged  to  the
31    taxpayer's  service address in this State regardless of where
32    such amount is billed or paid.
33        (c)  "Telecommunications", in  addition  to  the  meaning
34    ordinarily  and  popularly  ascribed to it, includes, without
 
                            -11-     LRB093 07190 SJM 15372 a
 1    limitation, messages or information transmitted  through  use
 2    of  local, toll and wide area telephone service; private line
 3    services;    channel    services;     telegraph     services;
 4    teletypewriter;  computer  exchange services; cellular mobile
 5    telecommunications   service;   specialized   mobile   radio;
 6    stationary two way radio; paging service; or any  other  form
 7    of  mobile and portable one-way or two-way communications; or
 8    any  other  transmission  of  messages  or   information   by
 9    electronic or similar means, between or among points by wire,
10    cable,  fiber-optics,  laser,  microwave, radio, satellite or
11    similar facilities.  As used  in  this  Act,  "private  line"
12    means  a dedicated non-traffic sensitive service for a single
13    customer, that entitles the customer to exclusive or priority
14    use of a communications channel or group  of  channels,  from
15    one  or  more  specified  locations  to  one  or  more  other
16    specified  locations.  The definition of "telecommunications"
17    shall not include value  added  services  in  which  computer
18    processing applications are used to act on the form, content,
19    code  and protocol of the information for purposes other than
20    transmission.    "Telecommunications"   shall   not   include
21    purchases  of  telecommunications  by  a   telecommunications
22    service  provider  for use as a component part of the service
23    provided  by  him  to  the  ultimate  retail   consumer   who
24    originates    or    terminates    the    taxable   end-to-end
25    communications.  Carrier  access  charges,  right  of  access
26    charges, charges for use of inter-company facilities, and all
27    telecommunications  resold  in  the  subsequent provision of,
28    used  as  a  component  of,  or  integrated  into  end-to-end
29    telecommunications service shall be non-taxable as sales  for
30    resale.
31        (d)  "Interstate     telecommunications"     means    all
32    telecommunications that either originate or terminate outside
33    this State.
34        (e)  "Intrastate    telecommunications"     means     all
 
                            -12-     LRB093 07190 SJM 15372 a
 1    telecommunications  that  originate and terminate within this
 2    State.
 3        (f)  "Department" means the Department of Revenue of  the
 4    State of Illinois.
 5        (g)  "Director"  means  the  Director  of Revenue for the
 6    Department of Revenue of the State of Illinois.
 7        (h)  "Taxpayer"  means  a  person  who  individually   or
 8    through  his  agents,  employees or permittees engages in the
 9    act   or    privilege    of    originating    or    receiving
10    telecommunications  in  this  State  and  who  incurs  a  tax
11    liability under this Article.
12        (i)  "Person"  means any natural individual, firm, trust,
13    estate, partnership, association, joint stock company,  joint
14    venture,   corporation,   limited  liability  company,  or  a
15    receiver, trustee, guardian or other representative appointed
16    by order of any court, the  Federal  and  State  governments,
17    including  State universities created by statute or any city,
18    town, county or other political subdivision of this State.
19        (j)  "Purchase  at   retail"   means   the   acquisition,
20    consumption  or  use  of  telecommunication through a sale at
21    retail.
22        (k)  "Sale at retail" means the  transmitting,  supplying
23    or  furnishing  of  telecommunications  and  all services and
24    equipment   provided   in   connection   therewith   for    a
25    consideration  to  persons  other  than the Federal and State
26    governments, and State universities created  by  statute  and
27    other  than between a parent corporation and its wholly owned
28    subsidiaries or between wholly owned subsidiaries  for  their
29    use or consumption and not for resale.
30        (l)  "Retailer"  means  and includes every person engaged
31    in the business of making sales at retail as defined in  this
32    Article.    The  Department  may,  in  its  discretion,  upon
33    application, authorize  the  collection  of  the  tax  hereby
34    imposed  by  any retailer not maintaining a place of business
 
                            -13-     LRB093 07190 SJM 15372 a
 1    within  this  State,  who,  to  the   satisfaction   of   the
 2    Department,  furnishes adequate security to insure collection
 3    and payment of the  tax.   Such  retailer  shall  be  issued,
 4    without  charge,  a  permit  to  collect  such  tax.  When so
 5    authorized, it shall be the duty of such retailer to  collect
 6    the  tax upon all of the gross charges for telecommunications
 7    in this State in the same manner  and  subject  to  the  same
 8    requirements  as  a  retailer maintaining a place of business
 9    within  this  State.   The  permit  may  be  revoked  by  the
10    Department at its discretion.
11        (m)  "Retailer maintaining a place of  business  in  this
12    State",  or  any  like  term, means and includes any retailer
13    having or maintaining within this State,  directly  or  by  a
14    subsidiary,  an office, distribution facilities, transmission
15    facilities,  sales  office,  warehouse  or  other  place   of
16    business,  or  any  agent  or  other representative operating
17    within this State under the authority of the retailer or  its
18    subsidiary, irrespective of whether such place of business or
19    agent  or other representative is located here permanently or
20    temporarily,  or  whether  such  retailer  or  subsidiary  is
21    licensed to do business in this State.
22        (n)  "Service   address"   means    the    location    of
23    telecommunications       equipment     from     which     the
24    telecommunications  services  are  originated  or  at   which
25    telecommunications  services  are received by a taxpayer.  In
26    the event this may not be a defined location, as in the  case
27    of  mobile  phones, paging systems, maritime systems, service
28    address means the customer's place of primary use as  defined
29    in  the  Mobile  Telecommunications  Sourcing Conformity Act.
30    For air-to-ground systems and the like, service address shall
31    mean  the  location  of  a  taxpayer's  primary  use  of  the
32    telecommunications equipment as defined by telephone  number,
33    authorization  code,  or location in Illinois where bills are
34    sent.
 
                            -14-     LRB093 07190 SJM 15372 a
 1        (o)  "Prepaid telephone calling  arrangements"  mean  the
 2    right to exclusively purchase telephone or telecommunications
 3    services  that  must  be  paid  for in advance and enable the
 4    origination  of  one  or  more  intrastate,  interstate,   or
 5    international  telephone  calls  or  other telecommunications
 6    using an access  number,  an  authorization  code,  or  both,
 7    whether  manually or electronically dialed, for which payment
 8    to a retailer must be made in advance, provided that,  unless
 9    recharged,  no  further service is provided once that prepaid
10    amount of  service  has  been  consumed.   Prepaid  telephone
11    calling  arrangements  include  the  recharge  of  a  prepaid
12    calling   arrangement.   For  purposes  of  this  subsection,
13    "recharge" means the purchase of additional prepaid telephone
14    or telecommunications services whether or not  the  purchaser
15    acquires  a  different  access  number or authorization code.
16    "Prepaid telephone calling arrangement" does not  include  an
17    arrangement  whereby  a customer purchases a payment card and
18    pursuant to which the service provider reflects the amount of
19    such purchase as a  credit  on  an  invoice  issued  to  that
20    customer under an existing subscription plan.
21    (Source:  P.A.  91-870,  eff.  6-22-00;  92-474, eff. 8-1-02;
22    92-526, eff. 1-1-03; 92-878, eff. 1-1-04.)

23        Section  10.    The   Telecommunications   Infrastructure
24    Maintenance  Fee  Act  is  amended  by changing Section 10 as
25    follows:

26        (35 ILCS 635/10)
27        (Text of Section before amendment by P.A. 92-878)
28        Sec. 10.  Definitions.
29        (a)  "Gross  charges"  means  the  amount   paid   to   a
30    telecommunications  retailer  for  the  act  or  privilege of
31    originating or receiving telecommunications in this State and
32    for all services rendered in connection therewith, valued  in
 
                            -15-     LRB093 07190 SJM 15372 a
 1    money  whether  paid  in  money or otherwise, including cash,
 2    credits, services, and property of every kind or nature,  and
 3    shall  be  determined without any deduction on account of the
 4    cost of such telecommunications, the cost  of  the  materials
 5    used,   labor   or   service  costs,  or  any  other  expense
 6    whatsoever.  In case credit is extended, the  amount  thereof
 7    shall  be included only as and when paid. "Gross charges" for
 8    private line service shall include charges  imposed  at  each
 9    channel  point  within  this  State,  charges for the channel
10    mileage between each channel point  within  this  State,  and
11    charges  for  that  portion  of  the  interstate inter-office
12    channel provided within Illinois.  However,  "gross  charges"
13    shall not include:
14             (1)  any amounts added to a purchaser's bill because
15        of  a  charge  made  under:  (i)  the fee imposed by this
16        Section, (ii) additional charges added to  a  purchaser's
17        bill under Section 9-221 or 9-222 of the Public Utilities
18        Act,  (iii)  the  tax  imposed  by the Telecommunications
19        Excise Tax Act, (iv) 911 surcharges, (v) the tax  imposed
20        by Section 4251 of the Internal Revenue Code, or (vi) the
21        tax     imposed     by     the    Simplified    Municipal
22        Telecommunications Tax Act;
23             (2)  charges for a  sent  collect  telecommunication
24        received outside of this State;
25             (3)  charges for leased time on equipment or charges
26        for  the  storage  of  data  or information or subsequent
27        retrieval  or  the  processing  of  data  or  information
28        intended to change its form or content.   Such  equipment
29        includes,  but is not limited to, the use of calculators,
30        computers,   data   processing   equipment,    tabulating
31        equipment,  or accounting equipment and also includes the
32        usage of computers under a time-sharing agreement;
33             (4)  charges for customer equipment, including  such
34        equipment  that  is leased or rented by the customer from
 
                            -16-     LRB093 07190 SJM 15372 a
 1        any source, wherein such charges  are  disaggregated  and
 2        separately identified from other charges;
 3             (5)  charges to business enterprises certified under
 4        Section 9-222.1 of the Public Utilities Act to the extent
 5        of such exemption and during the period of time specified
 6        by the Department of Commerce and Community Affairs;
 7             (6)  charges for telecommunications and all services
 8        and  equipment provided in connection therewith between a
 9        parent corporation and its wholly owned  subsidiaries  or
10        between wholly owned subsidiaries, and only to the extent
11        that  the  charges  between  the  parent  corporation and
12        wholly  owned  subsidiaries  or  between   wholly   owned
13        subsidiaries  represent  expense  allocation  between the
14        corporations and not the generation of profit other  than
15        a   regulatory   required   profit  for  the  corporation
16        rendering such services;
17             (7)  bad debts ("bad debt" means any  portion  of  a
18        debt  that is related to a sale at retail for which gross
19        charges are not otherwise deductible or  excludable  that
20        has  become  worthless  or  uncollectible,  as determined
21        under applicable federal income  tax  standards;  if  the
22        portion  of  the  debt  deemed  to be bad is subsequently
23        paid, the retailer shall report and pay the tax  on  that
24        portion  during the reporting period in which the payment
25        is made); or
26             (8)  charges   paid   by    inserting    coins    in
27        coin-operated telecommunication devices.
28        (a-5)  "Department"  means  the  Illinois  Department  of
29    Revenue.
30        (b)  "Telecommunications"  includes,  but  is not limited
31    to, messages or information transmitted through use of local,
32    toll, and wide  area  telephone  service,  channel  services,
33    telegraph services, teletypewriter service, computer exchange
34    services,  private  line  services,  specialized mobile radio
 
                            -17-     LRB093 07190 SJM 15372 a
 1    services,  or  any  other   transmission   of   messages   or
 2    information  by electronic or similar means, between or among
 3    points by wire, cable, fiber optics, laser, microwave, radio,
 4    satellite, or similar facilities.  Unless the context clearly
 5    requires otherwise, "telecommunications" shall  also  include
 6    wireless    telecommunications    as   hereinafter   defined.
 7    "Telecommunications" shall not include value  added  services
 8    in  which computer processing applications are used to act on
 9    the form, content, code, and protocol of the information  for
10    purposes other than transmission.  "Telecommunications" shall
11    not    include    purchase   of   telecommunications   by   a
12    telecommunications service provider for use  as  a  component
13    part  of  the  service provided by him or her to the ultimate
14    retail consumer who originates or terminates  the  end-to-end
15    communications.   Retailer  access  charges,  right of access
16    charges, charges for use of intercompany facilities, and  all
17    telecommunications  resold  in  the  subsequent provision and
18    used as  a  component  of,  or  integrated  into,  end-to-end
19    telecommunications  service  shall  not  be included in gross
20    charges as sales for resale.  "Telecommunications" shall  not
21    include  the  provision  of  cable  services  through a cable
22    system as defined in the Cable Communications Act of 1984 (47
23    U.S.C. Sections  521  and  following)  as  now  or  hereafter
24    amended  or  through  an  open video system as defined in the
25    Rules of the Federal  Communications  Commission  (47  C.D.F.
26    76.1550   and   following)   as  now  or  hereafter  amended.
27    Beginning  January  1,  2001,   prepaid   telephone   calling
28    arrangements  shall  not  be  considered "telecommunications"
29    subject to the tax imposed under this Act.  For  purposes  of
30    this  Section, "prepaid telephone calling arrangements" means
31    that term as  defined  in  Section  2-27  of  the  Retailers'
32    Occupation Tax Act.
33        (c)  "Wireless   telecommunications"   includes  cellular
34    mobile telephone  services,  personal  wireless  services  as
 
                            -18-     LRB093 07190 SJM 15372 a
 1    defined  in  Section  704(C) of the Telecommunications Act of
 2    1996 (Public Law No. 104-104) as now  or  hereafter  amended,
 3    including  all  commercial  mobile radio services, and paging
 4    services.
 5        (d)  "Telecommunications  retailer"  or   "retailer"   or
 6    "carrier"  means  and  includes  every  person engaged in the
 7    business of making sales of telecommunications at  retail  as
 8    defined   in  this  Section.   The  Department  may,  in  its
 9    discretion, upon applications, authorize  the  collection  of
10    the  fee  hereby  imposed  by  any retailer not maintaining a
11    place of business within this State, who, to the satisfaction
12    of the Department,  furnishes  adequate  security  to  insure
13    collection  and  payment  of the fee.  When so authorized, it
14    shall be the duty of such retailer to pay the fee upon all of
15    the gross charges for telecommunications in the  same  manner
16    and   subject   to   the  same  requirements  as  a  retailer
17    maintaining a place of business within this State.
18        (e)  "Retailer maintaining a place of  business  in  this
19    State",  or  any  like  term, means and includes any retailer
20    having or maintaining within this State,  directly  or  by  a
21    subsidiary,  an office, distribution facilities, transmission
22    facilities,  sales  office,  warehouse,  or  other  place  of
23    business, or any  agent  or  other  representative  operating
24    within  this State under the authority of the retailer or its
25    subsidiary, irrespective of whether such place of business or
26    agent or other representative is located here permanently  or
27    temporarily,  or  whether  such  retailer  or  subsidiary  is
28    licensed to do business in this State.
29        (f)  "Sale  of  telecommunications  at  retail" means the
30    transmitting, supplying, or furnishing of  telecommunications
31    and  all  services  rendered  in  connection  therewith for a
32    consideration, other than between a  parent  corporation  and
33    its   wholly  owned  subsidiaries  or  between  wholly  owned
34    subsidiaries,  when  the  gross  charge  made  by  one   such
 
                            -19-     LRB093 07190 SJM 15372 a
 1    corporation  to  another such corporation is not greater than
 2    the gross charge paid  to  the  retailer  for  their  use  or
 3    consumption and not for sale.
 4        (g)  "Service    address"    means    the   location   of
 5    telecommunications equipment  from  which  telecommunications
 6    services   are  originated  or  at  which  telecommunications
 7    services are received.  If this is not a defined location, as
 8    in the case of wireless telecommunications,  paging  systems,
 9    maritime  systems, service address means the customer's place
10    of primary use as defined in  the  Mobile  Telecommunications
11    Sourcing  Conformity Act.  For air-to-ground systems, and the
12    like, "service  address"  shall  mean  the  location  of  the
13    customer's primary use of the telecommunications equipment as
14    defined by the location in Illinois where bills are sent.
15    (Source:  P.A.  91-870,  eff.  6-22-00;  92-474, eff. 8-1-02;
16    92-526, eff. 1-1-03.)

17        (Text of Section after amendment by P.A. 92-878)
18        Sec. 10.  Definitions.
19        (a)  "Gross  charges"  means  the  amount   paid   to   a
20    telecommunications  retailer  for  the  act  or  privilege of
21    originating or receiving telecommunications in this State and
22    for all services rendered in connection therewith, valued  in
23    money  whether  paid  in  money or otherwise, including cash,
24    credits, services, and property of every kind or nature,  and
25    shall  be  determined without any deduction on account of the
26    cost of such telecommunications, the cost  of  the  materials
27    used,   labor   or   service  costs,  or  any  other  expense
28    whatsoever.  In case credit is extended, the  amount  thereof
29    shall  be included only as and when paid. "Gross charges" for
30    private line service shall include charges  imposed  at  each
31    channel  termination point within this State, charges for the
32    channel mileage between each channel termination point within
33    this State, and charges for that portion  of  the  interstate
34    inter-office  channel  provided  within Illinois. Charges for
 
                            -20-     LRB093 07190 SJM 15372 a
 1    that portion of the interstate inter-office channel  provided
 2    in  Illinois  shall be determined by the retailer as follows:
 3    (i) for interstate inter-office  channels  having  2  channel
 4    termination  points, only one of which is in Illinois, 50% of
 5    the total charge imposed; or (ii) for interstate inter-office
 6    channels having more than 2 channel termination  points,  one
 7    or  more  of  which  are  in Illinois, an amount equal to the
 8    total charge multiplied by a fraction, the numerator of which
 9    is the number of channel termination points  within  Illinois
10    and  the  denominator of which is the total number of channel
11    termination points; or (iii) any other method that reasonably
12    apportions the  total  charges  for  interstate  inter-office
13    channels among the states in which channel termination points
14    are  located.  Prior  to  January  1, 2004, June 1, 2003, any
15    apportionment method consistent with this paragraph or  other
16    method  that  reasonably  apportions  the  total  charges for
17    interstate inter-office channels among the  states  in  which
18    channel  terminations points are located shall be accepted as
19    a reasonable method to determine the charges for that portion
20    of  the  interstate  inter-office  channel  provided   within
21    Illinois  for that period. However, "gross charges" shall not
22    include any of the following:
23             (1)  Any amounts added to a purchaser's bill because
24        of a charge made under:  (i)  the  fee  imposed  by  this
25        Section,  (ii)  additional charges added to a purchaser's
26        bill under Section 9-221 or 9-222 of the Public Utilities
27        Act, (iii) the  tax  imposed  by  the  Telecommunications
28        Excise  Tax Act, (iv) 911 surcharges, (v) the tax imposed
29        by Section 4251 of the Internal Revenue Code, or (vi) the
30        tax    imposed    by     the     Simplified     Municipal
31        Telecommunications Tax Act.
32             (2)  Charges  for  a  sent collect telecommunication
33        received outside of this State.
34             (3)  Charges for leased time on equipment or charges
 
                            -21-     LRB093 07190 SJM 15372 a
 1        for the storage of  data  or  information  or  subsequent
 2        retrieval  or  the  processing  of  data  or  information
 3        intended  to  change its form or content.  Such equipment
 4        includes, but is not limited to, the use of  calculators,
 5        computers,    data   processing   equipment,   tabulating
 6        equipment, or accounting equipment and also includes  the
 7        usage of computers under a time-sharing agreement.
 8             (4)  Charges  for customer equipment, including such
 9        equipment that is leased or rented by the  customer  from
10        any  source,  wherein  such charges are disaggregated and
11        separately identified from other charges.
12             (5)  Charges to business enterprises certified under
13        Section 9-222.1 of the Public Utilities Act to the extent
14        of such exemption and during the period of time specified
15        by the Department of Commerce and Community Affairs.
16             (6)  Charges for telecommunications and all services
17        and equipment provided in connection therewith between  a
18        parent  corporation  and its wholly owned subsidiaries or
19        between wholly owned subsidiaries, and only to the extent
20        that the  charges  between  the  parent  corporation  and
21        wholly   owned   subsidiaries  or  between  wholly  owned
22        subsidiaries represent  expense  allocation  between  the
23        corporations  and not the generation of profit other than
24        a  regulatory  required  profit   for   the   corporation
25        rendering such services.
26             (7)  Bad  debts  ("bad  debt" means any portion of a
27        debt that is related to a sale at retail for which  gross
28        charges  are  not otherwise deductible or excludable that
29        has become  worthless  or  uncollectible,  as  determined
30        under  applicable  federal  income  tax standards; if the
31        portion of the debt deemed  to  be  bad  is  subsequently
32        paid,  the  retailer shall report and pay the tax on that
33        portion during the reporting period in which the  payment
34        is made).
 
                            -22-     LRB093 07190 SJM 15372 a
 1             (8)  Charges    paid    by    inserting   coins   in
 2        coin-operated telecommunication devices.
 3             (9)  Charges    for    nontaxable    services     or
 4        telecommunications  if  (i)  those charges are aggregated
 5        with  other  charges  for  telecommunications  that   are
 6        taxable,  (ii) those charges are not separately stated on
 7        the customer bill or invoice, and (iii) the retailer  can
 8        reasonably   identify   the  nontaxable  charges  on  the
 9        retailer's books and records kept in the  regular  course
10        of business.  If the nontaxable charges cannot reasonably
11        be  identified,  the  gross  charge from the sale of both
12        taxable and  nontaxable  services  or  telecommunications
13        billed  on  a  combined  basis shall be attributed to the
14        taxable services or  telecommunications.  The  burden  of
15        proving  nontaxable  charges  shall be on the retailer of
16        the telecommunications.
17        (a-5)  "Department"  means  the  Illinois  Department  of
18    Revenue.
19        (b)  "Telecommunications" includes, but  is  not  limited
20    to, messages or information transmitted through use of local,
21    toll,  and  wide  area  telephone  service, channel services,
22    telegraph services, teletypewriter service, computer exchange
23    services, private line  services,  specialized  mobile  radio
24    services,   or   any   other   transmission  of  messages  or
25    information by electronic or similar means, between or  among
26    points by wire, cable, fiber optics, laser, microwave, radio,
27    satellite, or similar facilities.  Unless the context clearly
28    requires  otherwise,  "telecommunications" shall also include
29    wireless   telecommunications   as    hereinafter    defined.
30    "Telecommunications"  shall  not include value added services
31    in which computer processing applications are used to act  on
32    the  form, content, code, and protocol of the information for
33    purposes other than transmission.  "Telecommunications" shall
34    not   include   purchase   of   telecommunications    by    a
 
                            -23-     LRB093 07190 SJM 15372 a
 1    telecommunications  service  provider  for use as a component
 2    part of the service provided by him or her  to  the  ultimate
 3    retail  consumer  who originates or terminates the end-to-end
 4    communications.  Retailer access  charges,  right  of  access
 5    charges,  charges for use of intercompany facilities, and all
 6    telecommunications resold in  the  subsequent  provision  and
 7    used  as  a  component  of,  or  integrated  into, end-to-end
 8    telecommunications service shall not  be  included  in  gross
 9    charges  as sales for resale.  "Telecommunications" shall not
10    include the provision  of  cable  services  through  a  cable
11    system as defined in the Cable Communications Act of 1984 (47
12    U.S.C.  Sections  521  and  following)  as  now  or hereafter
13    amended or through an open video system  as  defined  in  the
14    Rules  of  the  Federal  Communications Commission (47 C.D.F.
15    76.1550  and  following)  as  now   or   hereafter   amended.
16    Beginning   January   1,   2001,  prepaid  telephone  calling
17    arrangements shall  not  be  considered  "telecommunications"
18    subject  to  the tax imposed under this Act.  For purposes of
19    this Section, "prepaid telephone calling arrangements"  means
20    that  term  as  defined  in  Section  2-27  of the Retailers'
21    Occupation Tax Act.
22        (c)  "Wireless  telecommunications"   includes   cellular
23    mobile  telephone  services,  personal  wireless  services as
24    defined in Section 704(C) of the  Telecommunications  Act  of
25    1996  (Public  Law  No. 104-104) as now or hereafter amended,
26    including all commercial mobile radio  services,  and  paging
27    services.
28        (d)  "Telecommunications   retailer"   or  "retailer"  or
29    "carrier" means and includes  every  person  engaged  in  the
30    business  of  making sales of telecommunications at retail as
31    defined  in  this  Section.   The  Department  may,  in   its
32    discretion,  upon  applications,  authorize the collection of
33    the fee hereby imposed by  any  retailer  not  maintaining  a
34    place of business within this State, who, to the satisfaction
 
                            -24-     LRB093 07190 SJM 15372 a
 1    of  the  Department,  furnishes  adequate  security to insure
 2    collection and payment of the fee.  When  so  authorized,  it
 3    shall be the duty of such retailer to pay the fee upon all of
 4    the  gross  charges for telecommunications in the same manner
 5    and  subject  to  the  same  requirements   as   a   retailer
 6    maintaining a place of business within this State.
 7        (e)  "Retailer  maintaining  a  place of business in this
 8    State", or any like term, means  and  includes  any  retailer
 9    having  or  maintaining  within  this State, directly or by a
10    subsidiary, an office, distribution facilities,  transmission
11    facilities,  sales  office,  warehouse,  or  other  place  of
12    business,  or  any  agent  or  other representative operating
13    within this State under the authority of the retailer or  its
14    subsidiary, irrespective of whether such place of business or
15    agent  or other representative is located here permanently or
16    temporarily,  or  whether  such  retailer  or  subsidiary  is
17    licensed to do business in this State.
18        (f)  "Sale of telecommunications  at  retail"  means  the
19    transmitting,  supplying, or furnishing of telecommunications
20    and all services  rendered  in  connection  therewith  for  a
21    consideration,  other  than  between a parent corporation and
22    its  wholly  owned  subsidiaries  or  between  wholly   owned
23    subsidiaries,   when  the  gross  charge  made  by  one  such
24    corporation to another such corporation is not  greater  than
25    the  gross  charge  paid  to  the  retailer  for their use or
26    consumption and not for sale.
27        (g)  "Service   address"   means    the    location    of
28    telecommunications  equipment  from  which telecommunications
29    services  are  originated  or  at  which   telecommunications
30    services are received.  If this is not a defined location, as
31    in  the  case of wireless telecommunications, paging systems,
32    maritime systems, service address means the customer's  place
33    of  primary  use  as defined in the Mobile Telecommunications
34    Sourcing Conformity Act.  For air-to-ground systems, and  the
 
                            -25-     LRB093 07190 SJM 15372 a
 1    like,  "service  address"  shall  mean  the  location  of the
 2    customer's primary use of the telecommunications equipment as
 3    defined by the location in Illinois where bills are sent.
 4    (Source: P.A. 91-870,  eff.  6-22-00;  92-474,  eff.  8-1-02;
 5    92-526, eff. 1-1-03; 92-878, eff. 1-1-04.)

 6        Section  15.  The Simplified Municipal Telecommunications
 7    Tax Act is amended by changing Sections 5-7, 5-10,  and  5-50
 8    as follows:

 9        (35 ILCS 636/5-7)
10        (Text of Section before amendment by P.A. 92-878)
11        Sec.  5-7.   Definitions.   For  purposes  of  the  taxes
12    authorized by this Act:
13        "Amount  paid" means the amount charged to the taxpayer's
14    service address in such municipality regardless of where such
15    amount is billed or paid.
16        "Department" means the Illinois Department of Revenue.
17        "Gross charge" means the  amount  paid  for  the  act  or
18    privilege  of  originating or receiving telecommunications in
19    such municipality and for all services and equipment provided
20    in connection  therewith  by  a  retailer,  valued  in  money
21    whether  paid in money or otherwise, including cash, credits,
22    services and property of every kind or nature, and  shall  be
23    determined  without  any  deduction on account of the cost of
24    such telecommunications, the  cost  of  the  materials  used,
25    labor  or  service costs or any other expense whatsoever.  In
26    case credit is extended, the amount thereof shall be included
27    only as and when  paid.  "Gross  charges"  for  private  line
28    service  shall  include charges imposed at each channel point
29    within this State, charges for the  channel  mileage  between
30    each  channel  point  within this State, and charges for that
31    portion  of  the  interstate  inter-office  channel  provided
32    within Illinois. However, "gross charge" shall not include:
 
                            -26-     LRB093 07190 SJM 15372 a
 1             (1)  any amounts added to a purchaser's bill because
 2        of a charge made pursuant to: (i) the tax imposed by this
 3        Act, (ii)  the  tax  imposed  by  the  Telecommunications
 4        Excise  Tax Act, (iii) the tax imposed by Section 4251 of
 5        the Internal Revenue Code, (iv) 911  surcharges,  or  (v)
 6        charges   added  to  customers'  bills  pursuant  to  the
 7        provisions of  Section  9-221  or  9-222  of  the  Public
 8        Utilities  Act,  as amended, or any similar charges added
 9        to customers' bills by retailers who are not  subject  to
10        rate  regulation  by the Illinois Commerce Commission for
11        the purpose of recovering any of the tax  liabilities  or
12        other amounts specified in those provisions of the Public
13        Utilities Act;
14             (2)  charges  for  a  sent collect telecommunication
15        received outside of such municipality;
16             (3)  charges for leased time on equipment or charges
17        for the storage of data  or  information  for  subsequent
18        retrieval  or  the  processing  of  data  or  information
19        intended  to  change its form or content.  Such equipment
20        includes, but is not limited to, the use of  calculators,
21        computers,    data   processing   equipment,   tabulating
22        equipment or accounting equipment and also  includes  the
23        usage of computers under a time-sharing agreement;
24             (4)  charges  for customer equipment, including such
25        equipment that is leased or rented by the  customer  from
26        any  source,  wherein  such charges are disaggregated and
27        separately identified from other charges;
28             (5)  charges to business  enterprises  certified  as
29        exempt  under Section 9-222.1 of the Public Utilities Act
30        to the extent of such exemption and during the period  of
31        time   specified   by  the  Department  of  Commerce  and
32        Community Affairs;
33             (6)  charges for telecommunications and all services
34        and equipment provided in connection therewith between  a
 
                            -27-     LRB093 07190 SJM 15372 a
 1        parent  corporation  and its wholly owned subsidiaries or
 2        between wholly owned subsidiaries when  the  tax  imposed
 3        under  this  Act  has already been paid to a retailer and
 4        only to the extent that the charges  between  the  parent
 5        corporation  and  wholly  owned  subsidiaries  or between
 6        wholly owned subsidiaries  represent  expense  allocation
 7        between the corporations and not the generation of profit
 8        for the corporation rendering such service;
 9             (7)  bad  debts  ("bad  debt" means any portion of a
10        debt that is related to a sale at retail for which  gross
11        charges  are  not otherwise deductible or excludable that
12        has become  worthless  or  uncollectible,  as  determined
13        under  applicable  federal  income  tax standards; if the
14        portion of the debt deemed  to  be  bad  is  subsequently
15        paid,  the  retailer shall report and pay the tax on that
16        portion during the reporting period in which the  payment
17        is made);
18             (8)  charges    paid    by    inserting   coins   in
19        coin-operated telecommunication devices; or
20             (9)  amounts paid  by  telecommunications  retailers
21        under  the  Telecommunications Infrastructure Maintenance
22        Fee Act.
23        "Interstate      telecommunications"      means       all
24    telecommunications that either originate or terminate outside
25    this State.
26        "Intrastate       telecommunications"      means      all
27    telecommunications that originate and terminate  within  this
28    State.
29        "Person"  means  any  natural  individual,  firm,  trust,
30    estate,  partnership, association, joint stock company, joint
31    venture,  corporation,  limited  liability  company,   or   a
32    receiver,   trustee,   guardian,   or   other  representative
33    appointed by order  of  any  court,  the  Federal  and  State
34    governments, including State universities created by statute,
 
                            -28-     LRB093 07190 SJM 15372 a
 1    or  any city, town, county, or other political subdivision of
 2    this State.
 3        "Purchase at retail" means the  acquisition,  consumption
 4    or use of telecommunications through a sale at retail.
 5        "Retailer" means and includes every person engaged in the
 6    business  of  making  sales  at  retail  as  defined  in this
 7    Section.  The  Department  may,  in  its   discretion,   upon
 8    application,  authorize  the  collection  of  the  tax hereby
 9    imposed by any retailer not maintaining a place  of  business
10    within   this   State,   who,  to  the  satisfaction  of  the
11    Department, furnishes adequate security to insure  collection
12    and  payment  of  the  tax.   Such  retailer shall be issued,
13    without charge, a  permit  to  collect  such  tax.   When  so
14    authorized,  it shall be the duty of such retailer to collect
15    the tax upon all of the gross charges for  telecommunications
16    in  this  State  in  the  same manner and subject to the same
17    requirements as a retailer maintaining a  place  of  business
18    within  this  State.   The  permit  may  be  revoked  by  the
19    Department at its discretion.
20        "Retailer maintaining a place of business in this State",
21    or  any  like term, means and includes any retailer having or
22    maintaining within this State, directly or by  a  subsidiary,
23    an  office, distribution facilities, transmission facilities,
24    sales office, warehouse or other place of  business,  or  any
25    agent  or  other  representative  operating within this State
26    under the  authority  of  the  retailer  or  its  subsidiary,
27    irrespective  of  whether  such place of business or agent or
28    other  representative  is   located   here   permanently   or
29    temporarily,  or  whether  such  retailer  or  subsidiary  is
30    licensed to do business in this State.
31        "Sale  at  retail"  means  the transmitting, supplying or
32    furnishing  of  telecommunications  and  all   services   and
33    equipment    provided   in   connection   therewith   for   a
34    consideration, to persons other than the  Federal  and  State
 
                            -29-     LRB093 07190 SJM 15372 a
 1    governments,  and  State  universities created by statute and
 2    other than between a parent corporation and its wholly  owned
 3    subsidiaries  or  between wholly owned subsidiaries for their
 4    use or consumption and not for resale.
 5        "Service    address"    means     the     location     of
 6    telecommunications  equipment  from  which telecommunications
 7    services  are  originated  or  at  which   telecommunications
 8    services  are  received by a taxpayer.  In the event this may
 9    not be a defined location, as in the case of  mobile  phones,
10    paging  systems,  and maritime systems, service address means
11    the customer's place of primary use as defined in the  Mobile
12    Telecommunications     Sourcing    Conformity    Act.     For
13    air-to-ground systems and the like, "service  address"  shall
14    mean  the  location  of  a  taxpayer's  primary  use  of  the
15    telecommunications  equipment as defined by telephone number,
16    authorization code, or location in Illinois where  bills  are
17    sent.
18        "Taxpayer" means a person who individually or through his
19    or her agents, employees, or permittees engages in the act or
20    privilege of originating or receiving telecommunications in a
21    municipality  and who incurs a tax liability as authorized by
22    this Act.
23        "Telecommunications",  in   addition   to   the   meaning
24    ordinarily  and  popularly  ascribed to it, includes, without
25    limitation, messages or information transmitted  through  use
26    of local, toll, and wide area telephone service, private line
27    services,     channel     services,    telegraph    services,
28    teletypewriter, computer exchange services,  cellular  mobile
29    telecommunications   service,   specialized   mobile   radio,
30    stationary  two-way  radio, paging service, or any other form
31    of mobile and portable one-way or two-way communications,  or
32    any   other   transmission  of  messages  or  information  by
33    electronic or similar means, between or among points by wire,
34    cable, fiber optics, laser, microwave, radio,  satellite,  or
 
                            -30-     LRB093 07190 SJM 15372 a
 1    similar  facilities.   As  used  in  this Act, "private line"
 2    means a dedicated non-traffic sensitive service for a  single
 3    customer, that entitles the customer to exclusive or priority
 4    use  of  a  communications channel or group of channels, from
 5    one  or  more  specified  locations  to  one  or  more  other
 6    specified locations.  The definition of  "telecommunications"
 7    shall  not  include  value  added  services in which computer
 8    processing applications are used to act on the form, content,
 9    code, and protocol of the information for purposes other than
10    transmission.    "Telecommunications"   shall   not   include
11    purchases  of  telecommunications  by  a   telecommunications
12    service  provider  for use as a component part of the service
13    provided by such provider to the ultimate retail consumer who
14    originates   or    terminates    the    taxable    end-to-end
15    communications.   Carrier  access  charges,  right  of access
16    charges, charges for use of inter-company facilities, and all
17    telecommunications resold in  the  subsequent  provision  of,
18    used  as  a  component  of,  or  integrated  into, end-to-end
19    telecommunications service shall be non-taxable as sales  for
20    resale.   Prepaid telephone calling arrangements shall not be
21    considered "telecommunications" subject to  the  tax  imposed
22    under  this  Act.   For  purposes  of  this Section, "prepaid
23    telephone calling arrangements" means that term as defined in
24    Section 2-27 of the Retailers' Occupations Tax Act.
25    (Source: P.A. 92-526, eff. 7-1-02.)

26        (Text of Section after amendment by P.A. 92-878)
27        Sec.  5-7.   Definitions.   For  purposes  of  the  taxes
28    authorized by this Act:
29        "Amount paid" means the amount charged to the  taxpayer's
30    service address in such municipality regardless of where such
31    amount is billed or paid.
32        "Department" means the Illinois Department of Revenue.
33        "Gross  charge"  means  the  amount  paid  for the act or
34    privilege of originating or receiving  telecommunications  in
 
                            -31-     LRB093 07190 SJM 15372 a
 1    such municipality and for all services and equipment provided
 2    in  connection  therewith  by  a  retailer,  valued  in money
 3    whether paid in money or otherwise, including cash,  credits,
 4    services  and  property of every kind or nature, and shall be
 5    determined without any deduction on account of  the  cost  of
 6    such  telecommunications,  the  cost  of  the materials used,
 7    labor or service costs or any other expense  whatsoever.   In
 8    case credit is extended, the amount thereof shall be included
 9    only  as  and  when  paid.  "Gross  charges" for private line
10    service  shall  include  charges  imposed  at  each   channel
11    termination  point  within  a municipality that has imposed a
12    tax under this  Section  and  this  State,  charges  for  the
13    channel mileage between each channel point within this State,
14    and  charges  for that portion of the interstate inter-office
15    channels channel provided within that municipality  Illinois.
16    Charges  for  that  portion  of  the  interstate inter-office
17    channel connecting 2 or more channel termination points,  one
18    or  more  of  which  is  located  within  the  jurisdictional
19    boundary  of  such  municipality,  shall be determined by the
20    retailer by multiplying an amount equal to the  total  charge
21    for  the inter-office channel by a fraction, the numerator of
22    which is the number of channel termination  points  that  are
23    located   within   the   jurisdictional   boundary   of   the
24    municipality and the denominator of which is the total number
25    of  channel  termination points connected by the inter-office
26    channel. Prior to January 1, 2004, any method consistent with
27    this paragraph or other method that reasonably apportions the
28    total   charges   for   inter-office   channels   among   the
29    municipalities  in  which  channel  termination  points   are
30    located shall be accepted as a reasonable method to determine
31    the  taxable  portion  of  an  inter-office  channel provided
32    within a municipality for that period  provided  in  Illinois
33    shall  be  determined  by  the  retailer as follows:  (i) for
34    interstate inter-office channels having 2 channel termination
 
                            -32-     LRB093 07190 SJM 15372 a
 1    points, only one of which is in Illinois, 50%  of  the  total
 2    charge  imposed;  (ii)  for  interstate inter-office channels
 3    having more than 2 channel termination points, one or more of
 4    which are in Illinois, an amount equal to  the  total  charge
 5    multiplied  by  a  fraction,  the  numerator  of which is the
 6    number of channel termination points within Illinois and  the
 7    denominator   of   which  is  the  total  number  of  channel
 8    termination points; or (iii) any other method that reasonably
 9    apportions the  total  charges  for  interstate  inter-office
10    channels among the states in which channel termination points
11    are  located. Prior to June 1, 2003, any apportionment method
12    consistent  with  this  paragraph  shall  be  accepted  as  a
13    reasonable method to determine the charges for  that  portion
14    of   the  interstate  inter-office  channel  provided  within
15    Illinois for that period. However, "gross charge"  shall  not
16    include any of the following:
17             (1)  Any amounts added to a purchaser's bill because
18        of a charge made pursuant to: (i) the tax imposed by this
19        Act,  (ii)  the  tax  imposed  by  the Telecommunications
20        Excise Tax Act, (iii) the tax imposed by Section 4251  of
21        the  Internal  Revenue  Code, (iv) 911 surcharges, or (v)
22        charges  added  to  customers'  bills  pursuant  to   the
23        provisions  of  Section  9-221  or  9-222  of  the Public
24        Utilities Act, as amended, or any similar  charges  added
25        to  customers'  bills by retailers who are not subject to
26        rate regulation by the Illinois Commerce  Commission  for
27        the  purpose  of recovering any of the tax liabilities or
28        other amounts specified in those provisions of the Public
29        Utilities Act.
30             (2)  Charges for a  sent  collect  telecommunication
31        received outside of such municipality.
32             (3)  Charges for leased time on equipment or charges
33        for  the  storage  of  data or information for subsequent
34        retrieval  or  the  processing  of  data  or  information
 
                            -33-     LRB093 07190 SJM 15372 a
 1        intended to change its form or content.   Such  equipment
 2        includes,  but is not limited to, the use of calculators,
 3        computers,   data   processing   equipment,    tabulating
 4        equipment  or  accounting equipment and also includes the
 5        usage of computers under a time-sharing agreement.
 6             (4)  Charges for customer equipment, including  such
 7        equipment  that  is leased or rented by the customer from
 8        any source, wherein such charges  are  disaggregated  and
 9        separately identified from other charges.
10             (5)  Charges  to  business  enterprises certified as
11        exempt under Section 9-222.1 of the Public Utilities  Act
12        to  the extent of such exemption and during the period of
13        time  specified  by  the  Department  of   Commerce   and
14        Community Affairs.
15             (6)  Charges for telecommunications and all services
16        and  equipment provided in connection therewith between a
17        parent corporation and its wholly owned  subsidiaries  or
18        between  wholly  owned  subsidiaries when the tax imposed
19        under this Act has already been paid to  a  retailer  and
20        only  to  the  extent that the charges between the parent
21        corporation and  wholly  owned  subsidiaries  or  between
22        wholly  owned  subsidiaries  represent expense allocation
23        between the corporations and not the generation of profit
24        for the corporation rendering such service.
25             (7)  Bad debts ("bad debt" means any  portion  of  a
26        debt  that is related to a sale at retail for which gross
27        charges are not otherwise deductible or  excludable  that
28        has  become  worthless  or  uncollectible,  as determined
29        under applicable federal income  tax  standards;  if  the
30        portion  of  the  debt  deemed  to be bad is subsequently
31        paid, the retailer shall report and pay the tax  on  that
32        portion  during the reporting period in which the payment
33        is made).
34             (8)  Charges   paid   by    inserting    coins    in
 
                            -34-     LRB093 07190 SJM 15372 a
 1        coin-operated telecommunication devices.
 2             (9)  Amounts  paid  by  telecommunications retailers
 3        under the Telecommunications  Infrastructure  Maintenance
 4        Fee Act.
 5             (10)  Charges    for    nontaxable    services    or
 6        telecommunications  if  (i)  those charges are aggregated
 7        with  other  charges  for  telecommunications  that   are
 8        taxable,  (ii) those charges are not separately stated on
 9        the customer bill or invoice, and (iii) the retailer  can
10        reasonably   identify   the  nontaxable  charges  on  the
11        retailer's books and records kept in the  regular  course
12        of  business. If the nontaxable charges cannot reasonably
13        be identified, the gross charge from  the  sale  of  both
14        taxable  and  nontaxable  services  or telecommunications
15        billed on a combined basis shall  be  attributed  to  the
16        taxable  services  or  telecommunications.  The burden of
17        proving nontaxable charges shall be on  the  retailer  of
18        the telecommunications.
19        "Interstate       telecommunications"      means      all
20    telecommunications that either originate or terminate outside
21    this State.
22        "Intrastate      telecommunications"      means       all
23    telecommunications  that  originate and terminate within this
24    State.
25        "Person"  means  any  natural  individual,  firm,  trust,
26    estate, partnership, association, joint stock company,  joint
27    venture,   corporation,   limited  liability  company,  or  a
28    receiver,  trustee,   guardian,   or   other   representative
29    appointed  by  order  of  any  court,  the  Federal and State
30    governments, including State universities created by statute,
31    or any city, town, county, or other political subdivision  of
32    this State.
33        "Purchase  at  retail" means the acquisition, consumption
34    or use of telecommunications through a sale at retail.
 
                            -35-     LRB093 07190 SJM 15372 a
 1        "Retailer" means and includes every person engaged in the
 2    business of  making  sales  at  retail  as  defined  in  this
 3    Section.   The   Department  may,  in  its  discretion,  upon
 4    application, authorize  the  collection  of  the  tax  hereby
 5    imposed  by  any retailer not maintaining a place of business
 6    within  this  State,  who,  to  the   satisfaction   of   the
 7    Department,  furnishes adequate security to insure collection
 8    and payment of the  tax.   Such  retailer  shall  be  issued,
 9    without  charge,  a  permit  to  collect  such  tax.  When so
10    authorized, it shall be the duty of such retailer to  collect
11    the  tax upon all of the gross charges for telecommunications
12    in this State in the same manner  and  subject  to  the  same
13    requirements  as  a  retailer maintaining a place of business
14    within  this  State.   The  permit  may  be  revoked  by  the
15    Department at its discretion.
16        "Retailer maintaining a place of business in this State",
17    or any like term, means and includes any retailer  having  or
18    maintaining  within  this State, directly or by a subsidiary,
19    an office, distribution facilities, transmission  facilities,
20    sales  office,  warehouse  or other place of business, or any
21    agent or other representative  operating  within  this  State
22    under  the  authority  of  the  retailer  or  its subsidiary,
23    irrespective of whether such place of business  or  agent  or
24    other   representative   is   located   here  permanently  or
25    temporarily,  or  whether  such  retailer  or  subsidiary  is
26    licensed to do business in this State.
27        "Sale at retail" means  the  transmitting,  supplying  or
28    furnishing   of   telecommunications  and  all  services  and
29    equipment   provided   in   connection   therewith   for    a
30    consideration,  to  persons  other than the Federal and State
31    governments, and State universities created  by  statute  and
32    other  than between a parent corporation and its wholly owned
33    subsidiaries or between wholly owned subsidiaries  for  their
34    use or consumption and not for resale.
 
                            -36-     LRB093 07190 SJM 15372 a
 1        "Service     address"     means     the    location    of
 2    telecommunications equipment  from  which  telecommunications
 3    services   are  originated  or  at  which  telecommunications
 4    services are received by a taxpayer.  In the event  this  may
 5    not  be  a defined location, as in the case of mobile phones,
 6    paging systems, and maritime systems, service  address  means
 7    the  customer's place of primary use as defined in the Mobile
 8    Telecommunications    Sourcing    Conformity    Act.      For
 9    air-to-ground  systems  and the like, "service address" shall
10    mean  the  location  of  a  taxpayer's  primary  use  of  the
11    telecommunications equipment as defined by telephone  number,
12    authorization  code,  or location in Illinois where bills are
13    sent.
14        "Taxpayer" means a person who individually or through his
15    or her agents, employees, or permittees engages in the act or
16    privilege of originating or receiving telecommunications in a
17    municipality and who incurs a tax liability as authorized  by
18    this Act.
19        "Telecommunications",   in   addition   to   the  meaning
20    ordinarily and popularly ascribed to  it,  includes,  without
21    limitation,  messages  or information transmitted through use
22    of local, toll, and wide area telephone service, private line
23    services,    channel    services,     telegraph     services,
24    teletypewriter,  computer  exchange services, cellular mobile
25    telecommunications   service,   specialized   mobile   radio,
26    stationary two-way radio, paging service, or any  other  form
27    of  mobile and portable one-way or two-way communications, or
28    any  other  transmission  of  messages  or   information   by
29    electronic or similar means, between or among points by wire,
30    cable,  fiber  optics, laser, microwave, radio, satellite, or
31    similar facilities.  As used  in  this  Act,  "private  line"
32    means  a dedicated non-traffic sensitive service for a single
33    customer, that entitles the customer to exclusive or priority
34    use of a communications channel or group  of  channels,  from
 
                            -37-     LRB093 07190 SJM 15372 a
 1    one  or  more  specified  locations  to  one  or  more  other
 2    specified  locations.  The definition of "telecommunications"
 3    shall not include value  added  services  in  which  computer
 4    processing applications are used to act on the form, content,
 5    code, and protocol of the information for purposes other than
 6    transmission.    "Telecommunications"   shall   not   include
 7    purchases   of  telecommunications  by  a  telecommunications
 8    service provider for use as a component part of  the  service
 9    provided by such provider to the ultimate retail consumer who
10    originates    or    terminates    the    taxable   end-to-end
11    communications.  Carrier  access  charges,  right  of  access
12    charges, charges for use of inter-company facilities, and all
13    telecommunications  resold  in  the  subsequent provision of,
14    used as  a  component  of,  or  integrated  into,  end-to-end
15    telecommunications  service shall be non-taxable as sales for
16    resale.  Prepaid telephone calling arrangements shall not  be
17    considered  "telecommunications"  subject  to the tax imposed
18    under this Act.   For  purposes  of  this  Section,  "prepaid
19    telephone calling arrangements" means that term as defined in
20    Section 2-27 of the Retailers' Occupation Tax Act.
21    (Source: P.A. 92-526, eff. 7-1-02; 92-878, eff. 1-1-04.)

22        (35 ILCS 636/5-10)
23        Sec.  5-10.  Authority.  The corporate authorities of any
24    municipality in this  State  may  tax  any  and  all  of  the
25    following acts or privileges:
26        (a)  The   act   or  privilege  of  originating  in  such
27    municipality or receiving  in  such  municipality  intrastate
28    telecommunications   by   a   person.   To   prevent   actual
29    multi-municipal  taxation  of  the  act  or privilege that is
30    subject to taxation under this subsection, any taxpayer, upon
31    proof  that  the  taxpayer  has  paid  a   tax   in   another
32    municipality on that event, shall be allowed a credit against
33    any  tax enacted pursuant to or authorized by this Section to
 
                            -38-     LRB093 07190 SJM 15372 a
 1    the extent of the amount of the tax properly due and paid  in
 2    the  municipality that was not previously allowed as a credit
 3    against any other municipal tax. However,  such  tax  is  not
 4    imposed  on  such  act or privilege to the extent such act or
 5    privilege may not, under the Constitution and statutes of the
 6    United  States,  be  made  the   subject   of   taxation   by
 7    municipalities in this State.
 8        (b)  The   act   or  privilege  of  originating  in  such
 9    municipality or receiving  in  such  municipality  interstate
10    telecommunications by a person. To prevent actual multi-state
11    or  multi-municipal  taxation of the act or privilege that is
12    subject to taxation under this subsection, any taxpayer, upon
13    proof that the taxpayer has paid a tax in  another  state  or
14    municipality  in this State on such event, shall be allowed a
15    credit against any tax enacted pursuant to or  authorized  by
16    this Section to the extent of the amount of such tax properly
17    due and paid in such other state or such tax properly due and
18    paid in a municipality in this State which was not previously
19    allowed  as  a credit against any other state or local tax in
20    this State.  However, such tax is not imposed on the  act  or
21    privilege  to the extent such act or privilege may not, under
22    the Constitution and statutes of the United States,  be  made
23    the subject of taxation by municipalities in this State.
24    (Source: P.A. 92-526, eff. 7-1-02.)"; and

25    on page 5, by replacing lines 27 and 28 with the following:

26        "Section  95.   No acceleration or delay.  Where this Act
27    makes changes in a statute that is represented in this Act by
28    text that is not yet or no longer in effect (for  example,  a
29    Section  represented  by  multiple versions), the use of that
30    text does not accelerate or delay the taking  effect  of  (i)
31    the  changes made by this Act or (ii) provisions derived from
32    any other Public Act.
 
                            -39-     LRB093 07190 SJM 15372 a
 1        Section 99.  Effective date.  This Act  takes  effect  on
 2    January  1,  2004,  except  this  Section  and the changes to
 3    Sections  5-10  and  5-50   of   the   Simplified   Municipal
 4    Telecommunications Tax Act take effect upon becoming law.".