97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB3818

 

Introduced 10/5/2011, by Rep. Richard Morthland - Paul Evans

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-5
35 ILCS 110/3-5
35 ILCS 115/3-5
35 ILCS 120/2-5

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Beginning on July 1, 2012, exempts from the taxes imposed by these Acts (i) baling twine and baling wire and (ii) plastic bags, plastic sleeves, and plastic sheeting used to store or cover hay or silage, but only if it is certified by the purchaser that items (i) and (ii) will be used primarily for production agriculture or State or federal agricultural programs. Exempts those purchases from the sunset provisions of the Acts. Effective immediately.


LRB097 13626 HLH 58162 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB3818LRB097 13626 HLH 58162 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Section
53-5 as follows:
 
6    (35 ILCS 105/3-5)
7    Sec. 3-5. Exemptions. Use of the following tangible
8personal property is exempt from the tax imposed by this Act:
9    (1) Personal property purchased from a corporation,
10society, association, foundation, institution, or
11organization, other than a limited liability company, that is
12organized and operated as a not-for-profit service enterprise
13for the benefit of persons 65 years of age or older if the
14personal property was not purchased by the enterprise for the
15purpose of resale by the enterprise.
16    (2) Personal property purchased by a not-for-profit
17Illinois county fair association for use in conducting,
18operating, or promoting the county fair.
19    (3) Personal property purchased by a not-for-profit arts or
20cultural organization that establishes, by proof required by
21the Department by rule, that it has received an exemption under
22Section 501(c)(3) of the Internal Revenue Code and that is
23organized and operated primarily for the presentation or

 

 

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1support of arts or cultural programming, activities, or
2services. These organizations include, but are not limited to,
3music and dramatic arts organizations such as symphony
4orchestras and theatrical groups, arts and cultural service
5organizations, local arts councils, visual arts organizations,
6and media arts organizations. On and after the effective date
7of this amendatory Act of the 92nd General Assembly, however,
8an entity otherwise eligible for this exemption shall not make
9tax-free purchases unless it has an active identification
10number issued by the Department.
11    (4) Personal property purchased by a governmental body, by
12a corporation, society, association, foundation, or
13institution organized and operated exclusively for charitable,
14religious, or educational purposes, or by a not-for-profit
15corporation, society, association, foundation, institution, or
16organization that has no compensated officers or employees and
17that is organized and operated primarily for the recreation of
18persons 55 years of age or older. A limited liability company
19may qualify for the exemption under this paragraph only if the
20limited liability company is organized and operated
21exclusively for educational purposes. On and after July 1,
221987, however, no entity otherwise eligible for this exemption
23shall make tax-free purchases unless it has an active exemption
24identification number issued by the Department.
25    (5) Until July 1, 2003, a passenger car that is a
26replacement vehicle to the extent that the purchase price of

 

 

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1the car is subject to the Replacement Vehicle Tax.
2    (6) Until July 1, 2003 and beginning again on September 1,
32004 through August 30, 2014, graphic arts machinery and
4equipment, including repair and replacement parts, both new and
5used, and including that manufactured on special order,
6certified by the purchaser to be used primarily for graphic
7arts production, and including machinery and equipment
8purchased for lease. Equipment includes chemicals or chemicals
9acting as catalysts but only if the chemicals or chemicals
10acting as catalysts effect a direct and immediate change upon a
11graphic arts product.
12    (7) Farm chemicals.
13    (8) Legal tender, currency, medallions, or gold or silver
14coinage issued by the State of Illinois, the government of the
15United States of America, or the government of any foreign
16country, and bullion.
17    (9) Personal property purchased from a teacher-sponsored
18student organization affiliated with an elementary or
19secondary school located in Illinois.
20    (10) A motor vehicle of the first division, a motor vehicle
21of the second division that is a self-contained motor vehicle
22designed or permanently converted to provide living quarters
23for recreational, camping, or travel use, with direct walk
24through to the living quarters from the driver's seat, or a
25motor vehicle of the second division that is of the van
26configuration designed for the transportation of not less than

 

 

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17 nor more than 16 passengers, as defined in Section 1-146 of
2the Illinois Vehicle Code, that is used for automobile renting,
3as defined in the Automobile Renting Occupation and Use Tax
4Act.
5    (11) Farm machinery and equipment, both new and used,
6including that manufactured on special order, certified by the
7purchaser to be used primarily for production agriculture or
8State or federal agricultural programs, including individual
9replacement parts for the machinery and equipment, including
10machinery and equipment purchased for lease, and including
11implements of husbandry defined in Section 1-130 of the
12Illinois Vehicle Code, farm machinery and agricultural
13chemical and fertilizer spreaders, and nurse wagons required to
14be registered under Section 3-809 of the Illinois Vehicle Code,
15but excluding other motor vehicles required to be registered
16under the Illinois Vehicle Code. Horticultural polyhouses or
17hoop houses used for propagating, growing, or overwintering
18plants shall be considered farm machinery and equipment under
19this item (11). Agricultural chemical tender tanks and dry
20boxes shall include units sold separately from a motor vehicle
21required to be licensed and units sold mounted on a motor
22vehicle required to be licensed if the selling price of the
23tender is separately stated.
24    Farm machinery and equipment shall include precision
25farming equipment that is installed or purchased to be
26installed on farm machinery and equipment including, but not

 

 

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1limited to, tractors, harvesters, sprayers, planters, seeders,
2or spreaders. Precision farming equipment includes, but is not
3limited to, soil testing sensors, computers, monitors,
4software, global positioning and mapping systems, and other
5such equipment.
6    Farm machinery and equipment also includes computers,
7sensors, software, and related equipment used primarily in the
8computer-assisted operation of production agriculture
9facilities, equipment, and activities such as, but not limited
10to, the collection, monitoring, and correlation of animal and
11crop data for the purpose of formulating animal diets and
12agricultural chemicals. This item (11) is exempt from the
13provisions of Section 3-90.
14    (12) Fuel and petroleum products sold to or used by an air
15common carrier, certified by the carrier to be used for
16consumption, shipment, or storage in the conduct of its
17business as an air common carrier, for a flight destined for or
18returning from a location or locations outside the United
19States without regard to previous or subsequent domestic
20stopovers.
21    (13) Proceeds of mandatory service charges separately
22stated on customers' bills for the purchase and consumption of
23food and beverages purchased at retail from a retailer, to the
24extent that the proceeds of the service charge are in fact
25turned over as tips or as a substitute for tips to the
26employees who participate directly in preparing, serving,

 

 

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1hosting or cleaning up the food or beverage function with
2respect to which the service charge is imposed.
3    (14) Until July 1, 2003, oil field exploration, drilling,
4and production equipment, including (i) rigs and parts of rigs,
5rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
6tubular goods, including casing and drill strings, (iii) pumps
7and pump-jack units, (iv) storage tanks and flow lines, (v) any
8individual replacement part for oil field exploration,
9drilling, and production equipment, and (vi) machinery and
10equipment purchased for lease; but excluding motor vehicles
11required to be registered under the Illinois Vehicle Code.
12    (15) Photoprocessing machinery and equipment, including
13repair and replacement parts, both new and used, including that
14manufactured on special order, certified by the purchaser to be
15used primarily for photoprocessing, and including
16photoprocessing machinery and equipment purchased for lease.
17    (16) Until July 1, 2003, coal exploration, mining,
18offhighway hauling, processing, maintenance, and reclamation
19equipment, including replacement parts and equipment, and
20including equipment purchased for lease, but excluding motor
21vehicles required to be registered under the Illinois Vehicle
22Code.
23    (17) Until July 1, 2003, distillation machinery and
24equipment, sold as a unit or kit, assembled or installed by the
25retailer, certified by the user to be used only for the
26production of ethyl alcohol that will be used for consumption

 

 

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1as motor fuel or as a component of motor fuel for the personal
2use of the user, and not subject to sale or resale.
3    (18) Manufacturing and assembling machinery and equipment
4used primarily in the process of manufacturing or assembling
5tangible personal property for wholesale or retail sale or
6lease, whether that sale or lease is made directly by the
7manufacturer or by some other person, whether the materials
8used in the process are owned by the manufacturer or some other
9person, or whether that sale or lease is made apart from or as
10an incident to the seller's engaging in the service occupation
11of producing machines, tools, dies, jigs, patterns, gauges, or
12other similar items of no commercial value on special order for
13a particular purchaser.
14    (19) Personal property delivered to a purchaser or
15purchaser's donee inside Illinois when the purchase order for
16that personal property was received by a florist located
17outside Illinois who has a florist located inside Illinois
18deliver the personal property.
19    (20) Semen used for artificial insemination of livestock
20for direct agricultural production.
21    (21) Horses, or interests in horses, registered with and
22meeting the requirements of any of the Arabian Horse Club
23Registry of America, Appaloosa Horse Club, American Quarter
24Horse Association, United States Trotting Association, or
25Jockey Club, as appropriate, used for purposes of breeding or
26racing for prizes. This item (21) is exempt from the provisions

 

 

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1of Section 3-90, and the exemption provided for under this item
2(21) applies for all periods beginning May 30, 1995, but no
3claim for credit or refund is allowed on or after January 1,
42008 for such taxes paid during the period beginning May 30,
52000 and ending on January 1, 2008.
6    (22) Computers and communications equipment utilized for
7any hospital purpose and equipment used in the diagnosis,
8analysis, or treatment of hospital patients purchased by a
9lessor who leases the equipment, under a lease of one year or
10longer executed or in effect at the time the lessor would
11otherwise be subject to the tax imposed by this Act, to a
12hospital that has been issued an active tax exemption
13identification number by the Department under Section 1g of the
14Retailers' Occupation Tax Act. If the equipment is leased in a
15manner that does not qualify for this exemption or is used in
16any other non-exempt manner, the lessor shall be liable for the
17tax imposed under this Act or the Service Use Tax Act, as the
18case may be, based on the fair market value of the property at
19the time the non-qualifying use occurs. No lessor shall collect
20or attempt to collect an amount (however designated) that
21purports to reimburse that lessor for the tax imposed by this
22Act or the Service Use Tax Act, as the case may be, if the tax
23has not been paid by the lessor. If a lessor improperly
24collects any such amount from the lessee, the lessee shall have
25a legal right to claim a refund of that amount from the lessor.
26If, however, that amount is not refunded to the lessee for any

 

 

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

 

 

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

 

 

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1to be organized and operated exclusively for educational
2purposes. For purposes of this exemption, "a corporation,
3limited liability company, society, association, foundation,
4or institution organized and operated exclusively for
5educational purposes" means all tax-supported public schools,
6private schools that offer systematic instruction in useful
7branches of learning by methods common to public schools and
8that compare favorably in their scope and intensity with the
9course of study presented in tax-supported schools, and
10vocational or technical schools or institutes organized and
11operated exclusively to provide a course of study of not less
12than 6 weeks duration and designed to prepare individuals to
13follow a trade or to pursue a manual, technical, mechanical,
14industrial, business, or commercial occupation.
15    (28) 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 3-90.
3    (29) 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 other
6items, and replacement parts for these machines. Beginning
7January 1, 2002 and through June 30, 2003, machines and parts
8for machines used in commercial, coin-operated amusement and
9vending business if a use or occupation tax is paid on the
10gross receipts derived from the use of the commercial,
11coin-operated amusement and vending machines. This paragraph
12is exempt from the provisions of Section 3-90.
13    (30) Beginning January 1, 2001 and through June 30, 2011,
14food for human consumption that is to be consumed off the
15premises where it is sold (other than alcoholic beverages, soft
16drinks, and food that has been prepared for immediate
17consumption) and prescription and nonprescription medicines,
18drugs, medical appliances, and insulin, urine testing
19materials, syringes, and needles used by diabetics, for human
20use, when purchased for use by a person receiving medical
21assistance under Article V of the Illinois Public Aid Code who
22resides in a licensed long-term care facility, as defined in
23the Nursing Home Care Act, or in a licensed facility as defined
24in the ID/DD Community Care Act or the Specialized Mental
25Health Rehabilitation Act.
26    (31) Beginning on the effective date of this amendatory Act

 

 

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

 

 

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1lessor who leases the property, under a lease of one year or
2longer executed or in effect at the time the lessor would
3otherwise be subject to the tax imposed by this Act, to a
4governmental body that has been issued an active sales tax
5exemption identification number by the Department under
6Section 1g of the Retailers' Occupation Tax Act. If the
7property is leased in a manner that does not qualify for this
8exemption or used in any other nonexempt manner, the lessor
9shall be liable for the tax imposed under this Act or the
10Service Use Tax Act, as the case may be, based on the fair
11market value of the property at the time the nonqualifying use
12occurs. No lessor shall collect or attempt to collect an amount
13(however designated) that purports to reimburse that lessor for
14the tax imposed by this Act or the Service Use Tax Act, as the
15case may be, if the tax has not been paid by the lessor. If a
16lessor improperly collects any such amount from the lessee, the
17lessee shall have a legal right to claim a refund of that
18amount from the lessor. If, however, that amount is not
19refunded to the lessee for any reason, the lessor is liable to
20pay that amount to the Department. This paragraph is exempt
21from the provisions of Section 3-90.
22    (33) On and after July 1, 2003 and through June 30, 2004,
23the use in this State of motor vehicles of the second division
24with a gross vehicle weight in excess of 8,000 pounds and that
25are subject to the commercial distribution fee imposed under
26Section 3-815.1 of the Illinois Vehicle Code. Beginning on July

 

 

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11, 2004 and through June 30, 2005, the use in this State of
2motor vehicles of the second division: (i) with a gross vehicle
3weight rating in excess of 8,000 pounds; (ii) that are subject
4to the commercial distribution fee imposed under Section
53-815.1 of the Illinois Vehicle Code; and (iii) that are
6primarily used for commercial purposes. Through June 30, 2005,
7this exemption applies to repair and replacement parts added
8after the initial purchase of such a motor vehicle if that
9motor vehicle is used in a manner that would qualify for the
10rolling stock exemption otherwise provided for in this Act. For
11purposes of this paragraph, the term "used for commercial
12purposes" means the transportation of persons or property in
13furtherance of any commercial or industrial enterprise,
14whether for-hire or not.
15    (34) Beginning January 1, 2008, tangible personal property
16used in the construction or maintenance of a community water
17supply, as defined under Section 3.145 of the Environmental
18Protection Act, that is operated by a not-for-profit
19corporation that holds a valid water supply permit issued under
20Title IV of the Environmental Protection Act. This paragraph is
21exempt from the provisions of Section 3-90.
22    (35) Beginning January 1, 2010, materials, parts,
23equipment, components, and furnishings incorporated into or
24upon an aircraft as part of the modification, refurbishment,
25completion, replacement, repair, or maintenance of the
26aircraft. This exemption includes consumable supplies used in

 

 

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1the modification, refurbishment, completion, replacement,
2repair, and maintenance of aircraft, but excludes any
3materials, parts, equipment, components, and consumable
4supplies used in the modification, replacement, repair, and
5maintenance of aircraft engines or power plants, whether such
6engines or power plants are installed or uninstalled upon any
7such aircraft. "Consumable supplies" include, but are not
8limited to, adhesive, tape, sandpaper, general purpose
9lubricants, cleaning solution, latex gloves, and protective
10films. This exemption applies only to those organizations that
11(i) hold an Air Agency Certificate and are empowered to operate
12an approved repair station by the Federal Aviation
13Administration, (ii) have a Class IV Rating, and (iii) conduct
14operations in accordance with Part 145 of the Federal Aviation
15Regulations. The exemption does not include aircraft operated
16by a commercial air carrier providing scheduled passenger air
17service pursuant to authority issued under Part 121 or Part 129
18of the Federal Aviation Regulations.
19    (36) Tangible personal property purchased by a
20public-facilities corporation, as described in Section
2111-65-10 of the Illinois Municipal Code, for purposes of
22constructing or furnishing a municipal convention hall, but
23only if the legal title to the municipal convention hall is
24transferred to the municipality without any further
25consideration by or on behalf of the municipality at the time
26of the completion of the municipal convention hall or upon the

 

 

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1retirement or redemption of any bonds or other debt instruments
2issued by the public-facilities corporation in connection with
3the development of the municipal convention hall. This
4exemption includes existing public-facilities corporations as
5provided in Section 11-65-25 of the Illinois Municipal Code.
6This paragraph is exempt from the provisions of Section 3-90.
7    (37) Beginning on July 1, 2012, (i) baling twine and baling
8wire and (ii) plastic bags, plastic sleeves, and plastic
9sheeting used to store or cover hay or silage, but only if it
10is certified by the purchaser that items (i) and (ii) will be
11used primarily for production agriculture or State or federal
12agricultural programs. This paragraph is exempt from the
13provisions of Section 3-90.
14(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
1596-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
167-2-10; 97-38, eff. 6-28-11; 97-227, eff. 1-1-12; 97-431, eff.
178-16-11; revised 9-12-11.)
 
18    Section 10. The Service Use Tax Act is amended by changing
19Section 3-5 as follows:
 
20    (35 ILCS 110/3-5)
21    Sec. 3-5. Exemptions. Use of the following tangible
22personal property is exempt from the tax imposed by this Act:
23    (1) Personal property purchased from a corporation,
24society, association, foundation, institution, or

 

 

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

 

 

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1country, and bullion.
2    (5) Until July 1, 2003 and beginning again on September 1,
32004 through August 30, 2014, graphic arts machinery and
4equipment, including repair and replacement parts, both new and
5used, and including that manufactured on special order or
6purchased for lease, certified by the purchaser to be used
7primarily for graphic arts production. Equipment includes
8chemicals or chemicals acting as catalysts but only if the
9chemicals or chemicals acting as catalysts effect a direct and
10immediate change upon a graphic arts product.
11    (6) Personal property purchased from a teacher-sponsored
12student organization affiliated with an elementary or
13secondary school located in Illinois.
14    (7) Farm machinery and equipment, both new and used,
15including that manufactured on special order, certified by the
16purchaser to be used primarily for production agriculture or
17State or federal agricultural programs, including individual
18replacement parts for the machinery and equipment, including
19machinery and equipment purchased for lease, and including
20implements of husbandry defined in Section 1-130 of the
21Illinois Vehicle Code, farm machinery and agricultural
22chemical and fertilizer spreaders, and nurse wagons required to
23be registered under Section 3-809 of the Illinois Vehicle Code,
24but excluding other motor vehicles required to be registered
25under the Illinois Vehicle Code. Horticultural polyhouses or
26hoop houses used for propagating, growing, or overwintering

 

 

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

 

 

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

 

 

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1equipment purchased for lease.
2    (12) Until July 1, 2003, coal exploration, mining,
3offhighway hauling, processing, maintenance, and reclamation
4equipment, including replacement parts and equipment, and
5including equipment purchased for lease, but excluding motor
6vehicles required to be registered under the Illinois Vehicle
7Code.
8    (13) Semen used for artificial insemination of livestock
9for direct agricultural production.
10    (14) Horses, or interests in horses, registered with and
11meeting the requirements of any of the Arabian Horse Club
12Registry of America, Appaloosa Horse Club, American Quarter
13Horse Association, United States Trotting Association, or
14Jockey Club, as appropriate, used for purposes of breeding or
15racing for prizes. This item (14) is exempt from the provisions
16of Section 3-75, and the exemption provided for under this item
17(14) applies for all periods beginning May 30, 1995, but no
18claim for credit or refund is allowed on or after the effective
19date of this amendatory Act of the 95th General Assembly for
20such taxes paid during the period beginning May 30, 2000 and
21ending on the effective date of this amendatory Act of the 95th
22General Assembly.
23    (15) Computers and communications equipment utilized for
24any hospital purpose and equipment used in the diagnosis,
25analysis, or treatment of hospital patients purchased by a
26lessor who leases the equipment, under a lease of one year or

 

 

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

 

 

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

 

 

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1but not limited to municipal roads and streets, access roads,
2bridges, sidewalks, waste disposal systems, water and sewer
3line extensions, water distribution and purification
4facilities, storm water drainage and retention facilities, and
5sewage treatment facilities, resulting from a State or
6federally declared disaster in Illinois or bordering Illinois
7when such repairs are initiated on facilities located in the
8declared disaster area within 6 months after the disaster.
9    (19) Beginning July 1, 1999, game or game birds purchased
10at a "game breeding and hunting preserve area" as that term is
11used in the Wildlife Code. This paragraph is exempt from the
12provisions of Section 3-75.
13    (20) A motor vehicle, as that term is defined in Section
141-146 of the Illinois Vehicle Code, that is donated to a
15corporation, limited liability company, society, association,
16foundation, or institution that is determined by the Department
17to be organized and operated exclusively for educational
18purposes. For purposes of this exemption, "a corporation,
19limited liability company, society, association, foundation,
20or institution organized and operated exclusively for
21educational purposes" means all tax-supported public schools,
22private schools that offer systematic instruction in useful
23branches of learning by methods common to public schools and
24that compare favorably in their scope and intensity with the
25course of study presented in tax-supported schools, and
26vocational or technical schools or institutes organized and

 

 

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1operated exclusively to provide a course of study of not less
2than 6 weeks duration and designed to prepare individuals to
3follow a trade or to pursue a manual, technical, mechanical,
4industrial, business, or commercial occupation.
5    (21) Beginning January 1, 2000, personal property,
6including food, purchased through fundraising events for the
7benefit of a public or private elementary or secondary school,
8a group of those schools, or one or more school districts if
9the events are sponsored by an entity recognized by the school
10district that consists primarily of volunteers and includes
11parents and teachers of the school children. This paragraph
12does not apply to fundraising events (i) for the benefit of
13private home instruction or (ii) for which the fundraising
14entity purchases the personal property sold at the events from
15another individual or entity that sold the property for the
16purpose of resale by the fundraising entity and that profits
17from the sale to the fundraising entity. This paragraph is
18exempt from the provisions of Section 3-75.
19    (22) Beginning January 1, 2000 and through December 31,
202001, new or used automatic vending machines that prepare and
21serve hot food and beverages, including coffee, soup, and other
22items, and replacement parts for these machines. Beginning
23January 1, 2002 and through June 30, 2003, machines and parts
24for machines used in commercial, coin-operated amusement and
25vending business if a use or occupation tax is paid on the
26gross receipts derived from the use of the commercial,

 

 

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1coin-operated amusement and vending machines. This paragraph
2is exempt from the provisions of Section 3-75.
3    (23) Beginning August 23, 2001 and through June 30, 2011,
4food for human consumption that is to be consumed off the
5premises where it is sold (other than alcoholic beverages, soft
6drinks, and food that has been prepared for immediate
7consumption) and prescription and nonprescription medicines,
8drugs, medical appliances, and insulin, urine testing
9materials, syringes, and needles used by diabetics, for human
10use, when purchased for use by a person receiving medical
11assistance under Article V of the Illinois Public Aid Code who
12resides in a licensed long-term care facility, as defined in
13the Nursing Home Care Act, or in a licensed facility as defined
14in the ID/DD Community Care Act or the Specialized Mental
15Health Rehabilitation Act.
16    (24) Beginning on the effective date of this amendatory Act
17of the 92nd General Assembly, computers and communications
18equipment utilized for any hospital purpose and equipment used
19in the diagnosis, analysis, or treatment of hospital patients
20purchased by a lessor who leases the equipment, under a lease
21of one year or longer executed or in effect at the time the
22lessor would otherwise be subject to the tax imposed by this
23Act, to a hospital that has been issued an active tax exemption
24identification number by the Department under Section 1g of the
25Retailers' Occupation Tax Act. If the equipment is leased in a
26manner that does not qualify for this exemption or is used in

 

 

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

 

 

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1attempt to collect an amount (however designated) that purports
2to reimburse that lessor for the tax imposed by this Act or the
3Use Tax Act, as the case may be, if the tax has not been paid by
4the lessor. If a lessor improperly collects any such amount
5from the lessee, the lessee shall have a legal right to claim a
6refund of that amount from the lessor. If, however, that amount
7is not refunded to the lessee for any reason, the lessor is
8liable to pay that amount to the Department. This paragraph is
9exempt from the provisions of Section 3-75.
10    (26) Beginning January 1, 2008, tangible personal property
11used in the construction or maintenance of a community water
12supply, as defined under Section 3.145 of the Environmental
13Protection Act, that is operated by a not-for-profit
14corporation that holds a valid water supply permit issued under
15Title IV of the Environmental Protection Act. This paragraph is
16exempt from the provisions of Section 3-75.
17    (27) Beginning January 1, 2010, materials, parts,
18equipment, components, and furnishings incorporated into or
19upon an aircraft as part of the modification, refurbishment,
20completion, replacement, repair, or maintenance of the
21aircraft. This exemption includes consumable supplies used in
22the modification, refurbishment, completion, replacement,
23repair, and maintenance of aircraft, but excludes any
24materials, parts, equipment, components, and consumable
25supplies used in the modification, replacement, repair, and
26maintenance of aircraft engines or power plants, whether such

 

 

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1engines or power plants are installed or uninstalled upon any
2such aircraft. "Consumable supplies" include, but are not
3limited to, adhesive, tape, sandpaper, general purpose
4lubricants, cleaning solution, latex gloves, and protective
5films. This exemption applies only to those organizations that
6(i) hold an Air Agency Certificate and are empowered to operate
7an approved repair station by the Federal Aviation
8Administration, (ii) have a Class IV Rating, and (iii) conduct
9operations in accordance with Part 145 of the Federal Aviation
10Regulations. The exemption does not include aircraft operated
11by a commercial air carrier providing scheduled passenger air
12service pursuant to authority issued under Part 121 or Part 129
13of the Federal Aviation Regulations.
14    (28) Tangible personal property purchased by a
15public-facilities corporation, as described in Section
1611-65-10 of the Illinois Municipal Code, for purposes of
17constructing or furnishing a municipal convention hall, but
18only if the legal title to the municipal convention hall is
19transferred to the municipality without any further
20consideration by or on behalf of the municipality at the time
21of the completion of the municipal convention hall or upon the
22retirement or redemption of any bonds or other debt instruments
23issued by the public-facilities corporation in connection with
24the development of the municipal convention hall. This
25exemption includes existing public-facilities corporations as
26provided in Section 11-65-25 of the Illinois Municipal Code.

 

 

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1This paragraph is exempt from the provisions of Section 3-75.
2    (29) Beginning on July 1, 2012, (i) baling twine and baling
3wire and (ii) plastic bags, plastic sleeves, and plastic
4sheeting used to store or cover hay or silage, but only if it
5is certified by the purchaser that items (i) and (ii) will be
6used primarily for production agriculture or State or federal
7agricultural programs. This paragraph is exempt from the
8provisions of Section 3-75.
9(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
1096-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
117-2-10; 97-38, eff. 6-28-11; 97-227, eff. 1-1-12; 97-431, eff.
128-16-11; revised 9-12-11.)
 
13    Section 15. The Service Occupation Tax Act is amended by
14changing Section 3-5 as follows:
 
15    (35 ILCS 115/3-5)
16    Sec. 3-5. Exemptions. The following tangible personal
17property is exempt from the tax imposed by this Act:
18    (1) Personal property sold by a corporation, society,
19association, foundation, institution, or organization, other
20than a limited liability company, that is organized and
21operated as a not-for-profit service enterprise for the benefit
22of persons 65 years of age or older if the personal property
23was not purchased by the enterprise for the purpose of resale
24by the enterprise.

 

 

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1    (2) Personal property purchased by a not-for-profit
2Illinois county fair association for use in conducting,
3operating, or promoting the county fair.
4    (3) Personal property purchased by any not-for-profit arts
5or cultural organization that establishes, by proof required by
6the Department by rule, that it has received an exemption under
7Section 501(c)(3) of the Internal Revenue Code and that is
8organized and operated primarily for the presentation or
9support of arts or cultural programming, activities, or
10services. These organizations include, but are not limited to,
11music and dramatic arts organizations such as symphony
12orchestras and theatrical groups, arts and cultural service
13organizations, local arts councils, visual arts organizations,
14and media arts organizations. On and after the effective date
15of this amendatory Act of the 92nd General Assembly, however,
16an entity otherwise eligible for this exemption shall not make
17tax-free purchases unless it has an active identification
18number issued by the Department.
19    (4) Legal tender, currency, medallions, or gold or silver
20coinage issued by the State of Illinois, the government of the
21United States of America, or the government of any foreign
22country, and bullion.
23    (5) Until July 1, 2003 and beginning again on September 1,
242004 through August 30, 2014, graphic arts machinery and
25equipment, including repair and replacement parts, both new and
26used, and including that manufactured on special order or

 

 

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

 

 

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1tender is separately stated.
2    Farm machinery and equipment shall include precision
3farming equipment that is installed or purchased to be
4installed on farm machinery and equipment including, but not
5limited to, tractors, harvesters, sprayers, planters, seeders,
6or spreaders. Precision farming equipment includes, but is not
7limited to, soil testing sensors, computers, monitors,
8software, global positioning and mapping systems, and other
9such equipment.
10    Farm machinery and equipment also includes computers,
11sensors, software, and related equipment used primarily in the
12computer-assisted operation of production agriculture
13facilities, equipment, and activities such as, but not limited
14to, the collection, monitoring, and correlation of animal and
15crop data for the purpose of formulating animal diets and
16agricultural chemicals. This item (7) is exempt from the
17provisions of Section 3-55.
18    (8) Fuel and petroleum products sold to or used by an air
19common carrier, certified by the carrier to be used for
20consumption, shipment, or storage in the conduct of its
21business as an air common carrier, for a flight destined for or
22returning from a location or locations outside the United
23States without regard to previous or subsequent domestic
24stopovers.
25    (9) Proceeds of mandatory service charges separately
26stated on customers' bills for the purchase and consumption of

 

 

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

 

 

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1    (13) Beginning January 1, 1992 and through June 30, 2011,
2food for human consumption that is to be consumed off the
3premises where it is sold (other than alcoholic beverages, soft
4drinks and food that has been prepared for immediate
5consumption) and prescription and non-prescription medicines,
6drugs, medical appliances, and insulin, urine testing
7materials, syringes, and needles used by diabetics, for human
8use, when purchased for use by a person receiving medical
9assistance under Article V of the Illinois Public Aid Code who
10resides in a licensed long-term care facility, as defined in
11the Nursing Home Care Act, or in a licensed facility as defined
12in the ID/DD Community Care Act or the Specialized Mental
13Health Rehabilitation Act.
14    (14) Semen used for artificial insemination of livestock
15for direct agricultural production.
16    (15) Horses, or interests in horses, registered with and
17meeting the requirements of any of the Arabian Horse Club
18Registry of America, Appaloosa Horse Club, American Quarter
19Horse Association, United States Trotting Association, or
20Jockey Club, as appropriate, used for purposes of breeding or
21racing for prizes. This item (15) is exempt from the provisions
22of Section 3-55, and the exemption provided for under this item
23(15) applies for all periods beginning May 30, 1995, but no
24claim for credit or refund is allowed on or after January 1,
252008 (the effective date of Public Act 95-88) for such taxes
26paid during the period beginning May 30, 2000 and ending on

 

 

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

 

 

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

 

 

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

 

 

HB3818- 40 -LRB097 13626 HLH 58162 b

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

 

 

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

 

 

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

 

 

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1such aircraft. "Consumable supplies" include, but are not
2limited to, adhesive, tape, sandpaper, general purpose
3lubricants, cleaning solution, latex gloves, and protective
4films. This exemption applies only to those organizations that
5(i) hold an Air Agency Certificate and are empowered to operate
6an approved repair station by the Federal Aviation
7Administration, (ii) have a Class IV Rating, and (iii) conduct
8operations in accordance with Part 145 of the Federal Aviation
9Regulations. The exemption does not include aircraft operated
10by a commercial air carrier providing scheduled passenger air
11service pursuant to authority issued under Part 121 or Part 129
12of the Federal Aviation Regulations.
13    (30) Beginning on July 1, 2012, (i) baling twine and baling
14wire and (ii) plastic bags, plastic sleeves, and plastic
15sheeting used to store or cover hay or silage, but only if it
16is certified by the purchaser that items (i) and (ii) will be
17used primarily for production agriculture or State or federal
18agricultural programs. This paragraph is exempt from the
19provisions of Section 3-55.
20(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
2196-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
227-2-10; 97-38, eff. 6-28-11; 97-73, eff. 6-30-11; 97-227, eff.
231-1-12; 97-431, eff. 8-16-11; revised 9-12-11.)
 
24    Section 20. The Retailers' Occupation Tax Act is amended by
25changing Section 2-5 as follows:
 

 

 

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

 

 

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1farming equipment that is installed or purchased to be
2installed on farm machinery and equipment including, but not
3limited to, tractors, harvesters, sprayers, planters, seeders,
4or spreaders. Precision farming equipment includes, but is not
5limited to, soil testing sensors, computers, monitors,
6software, global positioning and mapping systems, and other
7such equipment.
8    Farm machinery and equipment also includes computers,
9sensors, software, and related equipment used primarily in the
10computer-assisted operation of production agriculture
11facilities, equipment, and activities such as, but not limited
12to, the collection, monitoring, and correlation of animal and
13crop data for the purpose of formulating animal diets and
14agricultural chemicals. This item (2) (7) is exempt from the
15provisions of Section 2-70.
16    (3) Until July 1, 2003, distillation machinery and
17equipment, sold as a unit or kit, assembled or installed by the
18retailer, certified by the user to be used only for the
19production of ethyl alcohol that will be used for consumption
20as motor fuel or as a component of motor fuel for the personal
21use of the user, and not subject to sale or resale.
22    (4) Until July 1, 2003 and beginning again September 1,
232004 through August 30, 2014, graphic arts machinery and
24equipment, including repair and replacement parts, both new and
25used, and including that manufactured on special order or
26purchased for lease, certified by the purchaser to be used

 

 

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1primarily for graphic arts production. Equipment includes
2chemicals or chemicals acting as catalysts but only if the
3chemicals or chemicals acting as catalysts effect a direct and
4immediate change upon a graphic arts product.
5    (5) A motor vehicle of the first division, a motor vehicle
6of the second division that is a self contained motor vehicle
7designed or permanently converted to provide living quarters
8for recreational, camping, or travel use, with direct walk
9through access to the living quarters from the driver's seat,
10or a motor vehicle of the second division that is of the van
11configuration designed for the transportation of not less than
127 nor more than 16 passengers, as defined in Section 1-146 of
13the Illinois Vehicle Code, that is used for automobile renting,
14as defined in the Automobile Renting Occupation and Use Tax
15Act. This paragraph is exempt from the provisions of Section
162-70.
17    (6) Personal property sold by a teacher-sponsored student
18organization affiliated with an elementary or secondary school
19located in Illinois.
20    (7) Until July 1, 2003, proceeds of that portion of the
21selling price of a passenger car the sale of which is subject
22to the Replacement Vehicle Tax.
23    (8) Personal property sold to an Illinois county fair
24association for use in conducting, operating, or promoting the
25county fair.
26    (9) Personal property sold to a not-for-profit arts or

 

 

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1cultural organization that establishes, by proof required by
2the Department by rule, that it has received an exemption under
3Section 501(c)(3) of the Internal Revenue Code and that is
4organized and operated primarily for the presentation or
5support of arts or cultural programming, activities, or
6services. These organizations include, but are not limited to,
7music and dramatic arts organizations such as symphony
8orchestras and theatrical groups, arts and cultural service
9organizations, local arts councils, visual arts organizations,
10and media arts organizations. On and after the effective date
11of this amendatory Act of the 92nd General Assembly, however,
12an entity otherwise eligible for this exemption shall not make
13tax-free purchases unless it has an active identification
14number issued by the Department.
15    (10) Personal property sold by a corporation, society,
16association, foundation, institution, or organization, other
17than a limited liability company, that is organized and
18operated as a not-for-profit service enterprise for the benefit
19of persons 65 years of age or older if the personal property
20was not purchased by the enterprise for the purpose of resale
21by the enterprise.
22    (11) Personal property sold to a governmental body, to a
23corporation, society, association, foundation, or institution
24organized and operated exclusively for charitable, religious,
25or educational purposes, or to a not-for-profit corporation,
26society, association, foundation, institution, or organization

 

 

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1that has no compensated officers or employees and that is
2organized and operated primarily for the recreation of persons
355 years of age or older. A limited liability company may
4qualify for the exemption under this paragraph only if the
5limited liability company is organized and operated
6exclusively for educational purposes. On and after July 1,
71987, however, no entity otherwise eligible for this exemption
8shall make tax-free purchases unless it has an active
9identification number issued by the Department.
10    (12) Tangible personal property sold to interstate
11carriers for hire for use as rolling stock moving in interstate
12commerce or to lessors under leases of one year or longer
13executed or in effect at the time of purchase by interstate
14carriers for hire for use as rolling stock moving in interstate
15commerce and equipment operated by a telecommunications
16provider, licensed as a common carrier by the Federal
17Communications Commission, which is permanently installed in
18or affixed to aircraft moving in interstate commerce.
19    (12-5) On and after July 1, 2003 and through June 30, 2004,
20motor vehicles of the second division with a gross vehicle
21weight in excess of 8,000 pounds that are subject to the
22commercial distribution fee imposed under Section 3-815.1 of
23the Illinois Vehicle Code. Beginning on July 1, 2004 and
24through June 30, 2005, the use in this State of motor vehicles
25of the second division: (i) with a gross vehicle weight rating
26in excess of 8,000 pounds; (ii) that are subject to the

 

 

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1commercial distribution fee imposed under Section 3-815.1 of
2the Illinois Vehicle Code; and (iii) that are primarily used
3for commercial purposes. Through June 30, 2005, this exemption
4applies to repair and replacement parts added after the initial
5purchase of such a motor vehicle if that motor vehicle is used
6in a manner that would qualify for the rolling stock exemption
7otherwise provided for in this Act. For purposes of this
8paragraph, "used for commercial purposes" means the
9transportation of persons or property in furtherance of any
10commercial or industrial enterprise whether for-hire or not.
11    (13) Proceeds from sales to owners, lessors, or shippers of
12tangible personal property that is utilized by interstate
13carriers for hire for use as rolling stock moving in interstate
14commerce and equipment operated by a telecommunications
15provider, licensed as a common carrier by the Federal
16Communications Commission, which is permanently installed in
17or affixed to aircraft moving in interstate commerce.
18    (14) Machinery and equipment that will be used by the
19purchaser, or a lessee of the purchaser, primarily in the
20process of manufacturing or assembling tangible personal
21property for wholesale or retail sale or lease, whether the
22sale or lease is made directly by the manufacturer or by some
23other person, whether the materials used in the process are
24owned by the manufacturer or some other person, or whether the
25sale or lease is made apart from or as an incident to the
26seller's engaging in the service occupation of producing

 

 

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1machines, tools, dies, jigs, patterns, gauges, or other similar
2items of no commercial value on special order for a particular
3purchaser.
4    (15) Proceeds of mandatory service charges separately
5stated on customers' bills for purchase and consumption of food
6and beverages, to the extent that the proceeds of the service
7charge are in fact turned over as tips or as a substitute for
8tips to the employees who participate directly in preparing,
9serving, hosting or cleaning up the food or beverage function
10with respect to which the service charge is imposed.
11    (16) Petroleum products sold to a purchaser if the seller
12is prohibited by federal law from charging tax to the
13purchaser.
14    (17) Tangible personal property sold to a common carrier by
15rail or motor that receives the physical possession of the
16property in Illinois and that transports the property, or
17shares with another common carrier in the transportation of the
18property, out of Illinois on a standard uniform bill of lading
19showing the seller of the property as the shipper or consignor
20of the property to a destination outside Illinois, for use
21outside Illinois.
22    (18) 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    (19) Until July 1 2003, oil field exploration, drilling,

 

 

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1and production equipment, including (i) rigs and parts of rigs,
2rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
3tubular goods, including casing and drill strings, (iii) pumps
4and pump-jack units, (iv) storage tanks and flow lines, (v) any
5individual replacement part for oil field exploration,
6drilling, and production equipment, and (vi) machinery and
7equipment purchased for lease; but excluding motor vehicles
8required to be registered under the Illinois Vehicle Code.
9    (20) Photoprocessing machinery and equipment, including
10repair and replacement parts, both new and used, including that
11manufactured on special order, certified by the purchaser to be
12used primarily for photoprocessing, and including
13photoprocessing machinery and equipment purchased for lease.
14    (21) Until July 1, 2003, coal exploration, mining,
15offhighway hauling, processing, maintenance, and reclamation
16equipment, including replacement parts and equipment, and
17including equipment purchased for lease, but excluding motor
18vehicles required to be registered under the Illinois Vehicle
19Code.
20    (22) Fuel and petroleum products sold to or used by an air
21carrier, certified by the carrier to be used for consumption,
22shipment, or storage in the conduct of its business as an air
23common carrier, for a flight destined for or returning from a
24location or locations outside the United States without regard
25to previous or subsequent domestic stopovers.
26    (23) A transaction in which the purchase order is received

 

 

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

 

 

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1in this State to a resident of another state that does not
2allow a reciprocal exemption shall be imposed at a rate equal
3to the state's rate of tax on taxable property in the state in
4which the purchaser is a resident, except that the tax shall
5not exceed the tax that would otherwise be imposed under this
6Act. At the time of the sale, the purchaser shall execute a
7statement, signed under penalty of perjury, of his or her
8intent to title the vehicle in the state in which the purchaser
9is a resident within 30 days after the sale and of the fact of
10the payment to the State of Illinois of tax in an amount
11equivalent to the state's rate of tax on taxable property in
12his or her state of residence and shall submit the statement to
13the appropriate tax collection agency in his or her state of
14residence. In addition, the retailer must retain a signed copy
15of the statement in his or her records. Nothing in this item
16shall be construed to require the removal of the vehicle from
17this state following the filing of an intent to title the
18vehicle in the purchaser's state of residence if the purchaser
19titles the vehicle in his or her state of residence within 30
20days after the date of sale. The tax collected under this Act
21in accordance with this item (25-5) shall be proportionately
22distributed as if the tax were collected at the 6.25% general
23rate imposed under this Act.
24    (25-7) Beginning on July 1, 2007, no tax is imposed under
25this Act on the sale of an aircraft, as defined in Section 3 of
26the Illinois Aeronautics Act, if all of the following

 

 

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1conditions are met:
2        (1) the aircraft leaves this State within 15 days after
3    the later of either the issuance of the final billing for
4    the sale of the aircraft, or the authorized approval for
5    return to service, completion of the maintenance record
6    entry, and completion of the test flight and ground test
7    for inspection, as required by 14 C.F.R. 91.407;
8        (2) the aircraft is not based or registered in this
9    State after the sale of the aircraft; and
10        (3) the seller retains in his or her books and records
11    and provides to the Department a signed and dated
12    certification from the purchaser, on a form prescribed by
13    the Department, certifying that the requirements of this
14    item (25-7) are met. The certificate must also include the
15    name and address of the purchaser, the address of the
16    location where the aircraft is to be titled or registered,
17    the address of the primary physical location of the
18    aircraft, and other information that the Department may
19    reasonably require.
20    For purposes of this item (25-7):
21    "Based in this State" means hangared, stored, or otherwise
22used, excluding post-sale customizations as defined in this
23Section, for 10 or more days in each 12-month period
24immediately following the date of the sale of the aircraft.
25    "Registered in this State" means an aircraft registered
26with the Department of Transportation, Aeronautics Division,

 

 

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1or titled or registered with the Federal Aviation
2Administration to an address located in this State.
3    This paragraph (25-7) is exempt from the provisions of
4Section 2-70.
5    (26) Semen used for artificial insemination of livestock
6for direct agricultural production.
7    (27) Horses, or interests in horses, registered with and
8meeting the requirements of any of the Arabian Horse Club
9Registry of America, Appaloosa Horse Club, American Quarter
10Horse Association, United States Trotting Association, or
11Jockey Club, as appropriate, used for purposes of breeding or
12racing for prizes. This item (27) is exempt from the provisions
13of Section 2-70, and the exemption provided for under this item
14(27) applies for all periods beginning May 30, 1995, but no
15claim for credit or refund is allowed on or after January 1,
162008 (the effective date of Public Act 95-88) for such taxes
17paid during the period beginning May 30, 2000 and ending on
18January 1, 2008 (the effective date of Public Act 95-88).
19    (28) Computers and communications equipment utilized for
20any hospital purpose and equipment used in the diagnosis,
21analysis, or treatment of hospital patients sold to a lessor
22who leases the equipment, under a lease of one year or longer
23executed or in effect at the time of the purchase, to a
24hospital that has been issued an active tax exemption
25identification number by the Department under Section 1g of
26this Act.

 

 

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1    (29) Personal property sold to a lessor who leases the
2property, under a lease of one year or longer executed or in
3effect at the time of the purchase, to a governmental body that
4has been issued an active tax exemption identification number
5by the Department under Section 1g of this Act.
6    (30) 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 donated for
9disaster relief to be used in a State or federally declared
10disaster area in Illinois or bordering Illinois by a
11manufacturer or retailer that is registered in this State to a
12corporation, society, association, foundation, or institution
13that has been issued a sales tax exemption identification
14number by the Department that assists victims of the disaster
15who reside within the declared disaster area.
16    (31) Beginning with taxable years ending on or after
17December 31, 1995 and ending with taxable years ending on or
18before December 31, 2004, personal property that is used in the
19performance of infrastructure repairs in this State, including
20but not limited to municipal roads and streets, access roads,
21bridges, sidewalks, waste disposal systems, water and sewer
22line extensions, water distribution and purification
23facilities, storm water drainage and retention facilities, and
24sewage treatment facilities, resulting from a State or
25federally declared disaster in Illinois or bordering Illinois
26when such repairs are initiated on facilities located in the

 

 

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1declared disaster area within 6 months after the disaster.
2    (32) Beginning July 1, 1999, game or game birds sold at a
3"game breeding and hunting preserve area" as that term is used
4in the Wildlife Code. This paragraph is exempt from the
5provisions of Section 2-70.
6    (33) 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 Department
10to be organized and operated exclusively for educational
11purposes. For purposes of this exemption, "a corporation,
12limited liability company, society, association, foundation,
13or institution organized and operated exclusively for
14educational purposes" means all tax-supported public schools,
15private schools that offer systematic instruction in useful
16branches of learning by methods common to public schools and
17that compare favorably in their scope and intensity with the
18course of study presented in tax-supported schools, and
19vocational or technical schools or institutes organized and
20operated exclusively to provide a course of study of not less
21than 6 weeks duration and designed to prepare individuals to
22follow a trade or to pursue a manual, technical, mechanical,
23industrial, business, or commercial occupation.
24    (34) Beginning January 1, 2000, personal property,
25including food, purchased through fundraising events for the
26benefit of a public or private elementary or secondary school,

 

 

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1a group of those schools, or one or more school districts if
2the events are sponsored by an entity recognized by the school
3district that consists primarily of volunteers and includes
4parents and teachers of the school children. This paragraph
5does not apply to fundraising events (i) for the benefit of
6private home instruction or (ii) for which the fundraising
7entity purchases the personal property sold at the events from
8another individual or entity that sold the property for the
9purpose of resale by the fundraising entity and that profits
10from the sale to the fundraising entity. This paragraph is
11exempt from the provisions of Section 2-70.
12    (35) Beginning January 1, 2000 and through December 31,
132001, new or used automatic vending machines that prepare and
14serve hot food and beverages, including coffee, soup, and other
15items, and replacement parts for these machines. Beginning
16January 1, 2002 and through June 30, 2003, machines and parts
17for machines used in commercial, coin-operated amusement and
18vending business if a use or occupation tax is paid on the
19gross receipts derived from the use of the commercial,
20coin-operated amusement and vending machines. This paragraph
21is exempt from the provisions of Section 2-70.
22    (35-5) Beginning August 23, 2001 and through June 30, 2011,
23food for human consumption that is to be consumed off the
24premises where it is sold (other than alcoholic beverages, soft
25drinks, and food that has been prepared for immediate
26consumption) and prescription and nonprescription medicines,

 

 

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1drugs, medical appliances, and insulin, urine testing
2materials, syringes, and needles used by diabetics, for human
3use, when purchased for use by a person receiving medical
4assistance under Article V of the Illinois Public Aid Code who
5resides in a licensed long-term care facility, as defined in
6the Nursing Home Care Act, or a licensed facility as defined in
7the ID/DD Community Care Act or the Specialized Mental Health
8Rehabilitation Act.
9    (36) Beginning August 2, 2001, computers and
10communications equipment utilized for any hospital purpose and
11equipment used in the diagnosis, analysis, or treatment of
12hospital patients sold to a lessor who leases the equipment,
13under a lease of one year or longer executed or in effect at
14the time of the purchase, to a hospital that has been issued an
15active tax exemption identification number by the Department
16under Section 1g of this Act. This paragraph is exempt from the
17provisions of Section 2-70.
18    (37) Beginning August 2, 2001, personal property sold to a
19lessor who leases the property, under a lease of one year or
20longer executed or in effect at the time of the purchase, to a
21governmental body that has been issued an active tax exemption
22identification number by the Department under Section 1g of
23this Act. This paragraph is exempt from the provisions of
24Section 2-70.
25    (38) Beginning on January 1, 2002 and through June 30,
262016, tangible personal property purchased from an Illinois

 

 

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1retailer by a taxpayer engaged in centralized purchasing
2activities in Illinois who will, upon receipt of the property
3in Illinois, temporarily store the property in Illinois (i) for
4the purpose of subsequently transporting it outside this State
5for use or consumption thereafter solely outside this State or
6(ii) for the purpose of being processed, fabricated, or
7manufactured into, attached to, or incorporated into other
8tangible personal property to be transported outside this State
9and thereafter used or consumed solely outside this State. The
10Director of Revenue shall, pursuant to rules adopted in
11accordance with the Illinois Administrative Procedure Act,
12issue a permit to any taxpayer in good standing with the
13Department who is eligible for the exemption under this
14paragraph (38). The permit issued under this paragraph (38)
15shall authorize the holder, to the extent and in the manner
16specified in the rules adopted under this Act, to purchase
17tangible personal property from a retailer exempt from the
18taxes imposed by this Act. Taxpayers shall maintain all
19necessary books and records to substantiate the use and
20consumption of all such tangible personal property outside of
21the State of Illinois.
22    (39) Beginning January 1, 2008, tangible personal property
23used in the construction or maintenance of a community water
24supply, as defined under Section 3.145 of the Environmental
25Protection Act, that is operated by a not-for-profit
26corporation that holds a valid water supply permit issued under

 

 

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1Title IV of the Environmental Protection Act. This paragraph is
2exempt from the provisions of Section 2-70.
3    (40) Beginning January 1, 2010, materials, parts,
4equipment, components, and furnishings incorporated into or
5upon an aircraft as part of the modification, refurbishment,
6completion, replacement, repair, or maintenance of the
7aircraft. This exemption includes consumable supplies used in
8the modification, refurbishment, completion, replacement,
9repair, and maintenance of aircraft, but excludes any
10materials, parts, equipment, components, and consumable
11supplies used in the modification, replacement, repair, and
12maintenance of aircraft engines or power plants, whether such
13engines or power plants are installed or uninstalled upon any
14such aircraft. "Consumable supplies" include, but are not
15limited to, adhesive, tape, sandpaper, general purpose
16lubricants, cleaning solution, latex gloves, and protective
17films. This exemption applies only to those organizations that
18(i) hold an Air Agency Certificate and are empowered to operate
19an approved repair station by the Federal Aviation
20Administration, (ii) have a Class IV Rating, and (iii) conduct
21operations in accordance with Part 145 of the Federal Aviation
22Regulations. The exemption does not include aircraft operated
23by a commercial air carrier providing scheduled passenger air
24service pursuant to authority issued under Part 121 or Part 129
25of the Federal Aviation Regulations.
26    (41) Tangible personal property sold to a

 

 

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1public-facilities corporation, as described in Section
211-65-10 of the Illinois Municipal Code, for purposes of
3constructing or furnishing a municipal convention hall, but
4only if the legal title to the municipal convention hall is
5transferred to the municipality without any further
6consideration by or on behalf of the municipality at the time
7of the completion of the municipal convention hall or upon the
8retirement or redemption of any bonds or other debt instruments
9issued by the public-facilities corporation in connection with
10the development of the municipal convention hall. This
11exemption includes existing public-facilities corporations as
12provided in Section 11-65-25 of the Illinois Municipal Code.
13This paragraph is exempt from the provisions of Section 2-70.
14    (42) Beginning on July 1, 2012, (i) baling twine and baling
15wire and (ii) plastic bags, plastic sleeves, and plastic
16sheeting used to store or cover hay or silage, but only if it
17is certified by the purchaser that items (i) and (ii) will be
18used primarily for production agriculture or State or federal
19agricultural programs. This paragraph is exempt from the
20provisions of Section 2-70.
21(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
2296-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
237-2-10; 97-38, eff. 6-28-11; 97-73, eff. 6-30-11; 97-227, eff.
241-1-12; 97-431, eff. 8-16-11; revised 9-12-11.)
 
25    Section 99. Effective date. This Act takes effect upon
26becoming law.