97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB5326

 

Introduced 2/8/2012, by Rep. Jerry L. Mitchell

 

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

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that, from August 15th through November 15th of each year beginning in 2012, propane used for agricultural purposes is exempt from taxation under the Acts. Effective immediately.


LRB097 14491 HLH 59346 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB5326LRB097 14491 HLH 59346 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) From August 15th through November 15th of each year
8beginning in 2012, propane used for agricultural purposes. This
9paragraph is exempt from the provisions of Section 3-90.
10(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
1196-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
127-2-10; 97-38, eff. 6-28-11; 97-227, eff. 1-1-12; 97-431, eff.
138-16-11; revised 9-12-11.)
 
14    Section 10. The Service Use Tax Act is amended by changing
15Section 3-5 as follows:
 
16    (35 ILCS 110/3-5)
17    Sec. 3-5. Exemptions. Use of the following tangible
18personal property is exempt from the tax imposed by this Act:
19    (1) Personal property purchased from a corporation,
20society, association, foundation, institution, or
21organization, other than a limited liability company, that is
22organized and operated as a not-for-profit service enterprise
23for the benefit of persons 65 years of age or older if the
24personal property was not purchased by the enterprise for the

 

 

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1purpose of resale by the enterprise.
2    (2) Personal property purchased by a non-profit Illinois
3county fair association for use in conducting, operating, or
4promoting the county fair.
5    (3) Personal property purchased by a not-for-profit arts or
6cultural organization that establishes, by proof required by
7the Department by rule, that it has received an exemption under
8Section 501(c)(3) of the Internal Revenue Code and that is
9organized and operated primarily for the presentation or
10support of arts or cultural programming, activities, or
11services. These organizations include, but are not limited to,
12music and dramatic arts organizations such as symphony
13orchestras and theatrical groups, arts and cultural service
14organizations, local arts councils, visual arts organizations,
15and media arts organizations. On and after the effective date
16of this amendatory Act of the 92nd General Assembly, however,
17an entity otherwise eligible for this exemption shall not make
18tax-free purchases unless it has an active identification
19number issued by the Department.
20    (4) Legal tender, currency, medallions, or gold or silver
21coinage issued by the State of Illinois, the government of the
22United States of America, or the government of any foreign
23country, and bullion.
24    (5) Until July 1, 2003 and beginning again on September 1,
252004 through August 30, 2014, graphic arts machinery and
26equipment, including repair and replacement parts, both new and

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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1to collect an amount (however designated) that purports to
2reimburse 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.
9    (17) Beginning with taxable years ending on or after
10December 31, 1995 and ending with taxable years ending on or
11before December 31, 2004, personal property that is donated for
12disaster relief to be used in a State or federally declared
13disaster area in Illinois or bordering Illinois by a
14manufacturer or retailer that is registered in this State to a
15corporation, society, association, foundation, or institution
16that has been issued a sales tax exemption identification
17number by the Department that assists victims of the disaster
18who reside within the declared disaster area.
19    (18) Beginning with taxable years ending on or after
20December 31, 1995 and ending with taxable years ending on or
21before December 31, 2004, personal property that is used in the
22performance of infrastructure repairs in this State, including
23but not limited to municipal roads and streets, access roads,
24bridges, sidewalks, waste disposal systems, water and sewer
25line extensions, water distribution and purification
26facilities, storm water drainage and retention facilities, and

 

 

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1sewage treatment facilities, resulting from a State or
2federally declared disaster in Illinois or bordering Illinois
3when such repairs are initiated on facilities located in the
4declared disaster area within 6 months after the disaster.
5    (19) Beginning July 1, 1999, game or game birds purchased
6at a "game breeding and hunting preserve area" as that term is
7used in the Wildlife Code. This paragraph is exempt from the
8provisions of Section 3-75.
9    (20) A motor vehicle, as that term is defined in Section
101-146 of the Illinois Vehicle Code, that is donated to a
11corporation, limited liability company, society, association,
12foundation, or institution that is determined by the Department
13to be organized and operated exclusively for educational
14purposes. For purposes of this exemption, "a corporation,
15limited liability company, society, association, foundation,
16or institution organized and operated exclusively for
17educational purposes" means all tax-supported public schools,
18private schools that offer systematic instruction in useful
19branches of learning by methods common to public schools and
20that compare favorably in their scope and intensity with the
21course of study presented in tax-supported schools, and
22vocational or technical schools or institutes organized and
23operated exclusively to provide a course of study of not less
24than 6 weeks duration and designed to prepare individuals to
25follow a trade or to pursue a manual, technical, mechanical,
26industrial, business, or commercial occupation.

 

 

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1    (21) Beginning January 1, 2000, personal property,
2including food, purchased through fundraising events for the
3benefit of a public or private elementary or secondary school,
4a group of those schools, or one or more school districts if
5the events are sponsored by an entity recognized by the school
6district that consists primarily of volunteers and includes
7parents and teachers of the school children. This paragraph
8does not apply to fundraising events (i) for the benefit of
9private home instruction or (ii) for which the fundraising
10entity purchases the personal property sold at the events from
11another individual or entity that sold the property for the
12purpose of resale by the fundraising entity and that profits
13from the sale to the fundraising entity. This paragraph is
14exempt from the provisions of Section 3-75.
15    (22) Beginning January 1, 2000 and through December 31,
162001, new or used automatic vending machines that prepare and
17serve hot food and beverages, including coffee, soup, and other
18items, and replacement parts for these machines. Beginning
19January 1, 2002 and through June 30, 2003, machines and parts
20for machines used in commercial, coin-operated amusement and
21vending business if a use or occupation tax is paid on the
22gross receipts derived from the use of the commercial,
23coin-operated amusement and vending machines. This paragraph
24is exempt from the provisions of Section 3-75.
25    (23) Beginning August 23, 2001 and through June 30, 2011,
26food for human consumption that is to be consumed off the

 

 

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1premises where it is sold (other than alcoholic beverages, soft
2drinks, and food that has been prepared for immediate
3consumption) and prescription and nonprescription medicines,
4drugs, medical appliances, and insulin, urine testing
5materials, syringes, and needles used by diabetics, for human
6use, when purchased for use by a person receiving medical
7assistance under Article V of the Illinois Public Aid Code who
8resides in a licensed long-term care facility, as defined in
9the Nursing Home Care Act, or in a licensed facility as defined
10in the ID/DD Community Care Act or the Specialized Mental
11Health Rehabilitation Act.
12    (24) Beginning on the effective date of this amendatory Act
13of the 92nd General Assembly, computers and communications
14equipment utilized for any hospital purpose and equipment used
15in the diagnosis, analysis, or treatment of hospital patients
16purchased by a lessor who leases the equipment, under a lease
17of one year or longer executed or in effect at the time the
18lessor would otherwise be subject to the tax imposed by this
19Act, to a hospital that has been issued an active tax exemption
20identification number by the Department under Section 1g of the
21Retailers' Occupation Tax Act. If the equipment 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

 

 

HB5326- 28 -LRB097 14491 HLH 59346 b

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

 

 

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1from the lessee, the lessee shall have a legal right to claim a
2refund of that amount from the lessor. If, however, that amount
3is not refunded to the lessee for any reason, the lessor is
4liable to pay that amount to the Department. This paragraph is
5exempt from the provisions of Section 3-75.
6    (26) Beginning January 1, 2008, tangible personal property
7used in the construction or maintenance of a community water
8supply, as defined under Section 3.145 of the Environmental
9Protection Act, that is operated by a not-for-profit
10corporation that holds a valid water supply permit issued under
11Title IV of the Environmental Protection Act. This paragraph is
12exempt from the provisions of Section 3-75.
13    (27) Beginning January 1, 2010, materials, parts,
14equipment, components, and furnishings incorporated into or
15upon an aircraft as part of the modification, refurbishment,
16completion, replacement, repair, or maintenance of the
17aircraft. This exemption includes consumable supplies used in
18the modification, refurbishment, completion, replacement,
19repair, and maintenance of aircraft, but excludes any
20materials, parts, equipment, components, and consumable
21supplies used in the modification, replacement, repair, and
22maintenance of aircraft engines or power plants, whether such
23engines or power plants are installed or uninstalled upon any
24such aircraft. "Consumable supplies" include, but are not
25limited to, adhesive, tape, sandpaper, general purpose
26lubricants, cleaning solution, latex gloves, and protective

 

 

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1films. This exemption applies only to those organizations that
2(i) hold an Air Agency Certificate and are empowered to operate
3an approved repair station by the Federal Aviation
4Administration, (ii) have a Class IV Rating, and (iii) conduct
5operations in accordance with Part 145 of the Federal Aviation
6Regulations. The exemption does not include aircraft operated
7by a commercial air carrier providing scheduled passenger air
8service pursuant to authority issued under Part 121 or Part 129
9of the Federal Aviation Regulations.
10    (28) Tangible personal property purchased by a
11public-facilities corporation, as described in Section
1211-65-10 of the Illinois Municipal Code, for purposes of
13constructing or furnishing a municipal convention hall, but
14only if the legal title to the municipal convention hall is
15transferred to the municipality without any further
16consideration by or on behalf of the municipality at the time
17of the completion of the municipal convention hall or upon the
18retirement or redemption of any bonds or other debt instruments
19issued by the public-facilities corporation in connection with
20the development of the municipal convention hall. This
21exemption includes existing public-facilities corporations as
22provided in Section 11-65-25 of the Illinois Municipal Code.
23This paragraph is exempt from the provisions of Section 3-75.
24    (29) From August 15th through November 15th of each year
25beginning in 2012, propane used for agricultural purposes. This
26paragraph is exempt from the provisions of Section 3-75.

 

 

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1(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
296-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
37-2-10; 97-38, eff. 6-28-11; 97-227, eff. 1-1-12; 97-431, eff.
48-16-11; revised 9-12-11.)
 
5    Section 15. The Service Occupation Tax Act is amended by
6changing Section 3-5 as follows:
 
7    (35 ILCS 115/3-5)
8    Sec. 3-5. Exemptions. The following tangible personal
9property is exempt from the tax imposed by this Act:
10    (1) Personal property sold by a corporation, society,
11association, foundation, institution, or organization, other
12than a limited liability company, that is organized and
13operated as a not-for-profit service enterprise for the benefit
14of persons 65 years of age or older if the personal property
15was not purchased by the enterprise for the purpose of resale
16by the enterprise.
17    (2) Personal property purchased by a not-for-profit
18Illinois county fair association for use in conducting,
19operating, or promoting the county fair.
20    (3) Personal property purchased by any not-for-profit arts
21or cultural organization that establishes, by proof required by
22the Department by rule, that it has received an exemption under
23Section 501(c)(3) of the Internal Revenue Code and that is
24organized and operated primarily for the presentation or

 

 

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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) Legal tender, currency, medallions, or gold or silver
12coinage issued by the State of Illinois, the government of the
13United States of America, or the government of any foreign
14country, and bullion.
15    (5) Until July 1, 2003 and beginning again on September 1,
162004 through August 30, 2014, graphic arts machinery and
17equipment, including repair and replacement parts, both new and
18used, and including that manufactured on special order or
19purchased for lease, certified by the purchaser to be used
20primarily for graphic arts production. Equipment includes
21chemicals or chemicals acting as catalysts but only if the
22chemicals or chemicals acting as catalysts effect a direct and
23immediate change upon a graphic arts product.
24    (6) Personal property sold by a teacher-sponsored student
25organization affiliated with an elementary or secondary school
26located in Illinois.

 

 

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

 

 

HB5326- 34 -LRB097 14491 HLH 59346 b

1such equipment.
2    Farm machinery and equipment also includes computers,
3sensors, software, and related equipment used primarily in the
4computer-assisted operation of production agriculture
5facilities, equipment, and activities such as, but not limited
6to, the collection, monitoring, and correlation of animal and
7crop data for the purpose of formulating animal diets and
8agricultural chemicals. This item (7) is exempt from the
9provisions of Section 3-55.
10    (8) Fuel and petroleum products sold to or used by an air
11common carrier, certified by the carrier to be used for
12consumption, shipment, or storage in the conduct of its
13business as an air common carrier, for a flight destined for or
14returning from a location or locations outside the United
15States without regard to previous or subsequent domestic
16stopovers.
17    (9) Proceeds of mandatory service charges separately
18stated on customers' bills for the purchase and consumption of
19food and beverages, to the extent that the proceeds of the
20service charge are in fact turned over as tips or as a
21substitute for tips to the employees who participate directly
22in preparing, serving, hosting or cleaning up the food or
23beverage function with respect to which the service charge is
24imposed.
25    (10) Until July 1, 2003, oil field exploration, drilling,
26and production equipment, including (i) rigs and parts of rigs,

 

 

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1rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
2tubular goods, including casing and drill strings, (iii) pumps
3and pump-jack units, (iv) storage tanks and flow lines, (v) any
4individual replacement part for oil field exploration,
5drilling, and production equipment, and (vi) machinery and
6equipment purchased for lease; but excluding motor vehicles
7required to be registered under the Illinois Vehicle Code.
8    (11) Photoprocessing machinery and equipment, including
9repair and replacement parts, both new and used, including that
10manufactured on special order, certified by the purchaser to be
11used primarily for photoprocessing, and including
12photoprocessing machinery and equipment purchased for lease.
13    (12) Until July 1, 2003, coal exploration, mining,
14offhighway hauling, processing, maintenance, and reclamation
15equipment, including replacement parts and equipment, and
16including equipment purchased for lease, but excluding motor
17vehicles required to be registered under the Illinois Vehicle
18Code.
19    (13) Beginning January 1, 1992 and through June 30, 2011,
20food for human consumption that is to be consumed off the
21premises where it is sold (other than alcoholic beverages, soft
22drinks and food that has been prepared for immediate
23consumption) and prescription and non-prescription medicines,
24drugs, medical appliances, and insulin, urine testing
25materials, syringes, and needles used by diabetics, for human
26use, when purchased for use by a person receiving medical

 

 

HB5326- 36 -LRB097 14491 HLH 59346 b

1assistance under Article V of the Illinois Public Aid Code who
2resides in a licensed long-term care facility, as defined in
3the Nursing Home Care Act, or in a licensed facility as defined
4in the ID/DD Community Care Act or the Specialized Mental
5Health Rehabilitation Act.
6    (14) Semen used for artificial insemination of livestock
7for direct agricultural production.
8    (15) Horses, or interests in horses, registered with and
9meeting the requirements of any of the Arabian Horse Club
10Registry of America, Appaloosa Horse Club, American Quarter
11Horse Association, United States Trotting Association, or
12Jockey Club, as appropriate, used for purposes of breeding or
13racing for prizes. This item (15) is exempt from the provisions
14of Section 3-55, and the exemption provided for under this item
15(15) applies for all periods beginning May 30, 1995, but no
16claim for credit or refund is allowed on or after January 1,
172008 (the effective date of Public Act 95-88) for such taxes
18paid during the period beginning May 30, 2000 and ending on
19January 1, 2008 (the effective date of Public Act 95-88).
20    (16) Computers and communications equipment utilized for
21any hospital purpose and equipment used in the diagnosis,
22analysis, or treatment of hospital patients sold to a lessor
23who leases the equipment, under a lease of one year or longer
24executed or in effect at the time of the purchase, to a
25hospital that has been issued an active tax exemption
26identification number by the Department under Section 1g of the

 

 

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1Retailers' Occupation Tax Act.
2    (17) Personal property sold to a lessor who leases the
3property, under a lease of one year or longer executed or in
4effect at the time of the purchase, to a governmental body that
5has been issued an active tax exemption identification number
6by the Department under Section 1g of the Retailers' Occupation
7Tax Act.
8    (18) Beginning with taxable years ending on or after
9December 31, 1995 and ending with taxable years ending on or
10before December 31, 2004, personal property that is donated for
11disaster relief to be used in a State or federally declared
12disaster area in Illinois or bordering Illinois by a
13manufacturer or retailer that is registered in this State to a
14corporation, society, association, foundation, or institution
15that has been issued a sales tax exemption identification
16number by the Department that assists victims of the disaster
17who reside within the declared disaster area.
18    (19) Beginning with taxable years ending on or after
19December 31, 1995 and ending with taxable years ending on or
20before December 31, 2004, personal property that is used in the
21performance of infrastructure repairs in this State, including
22but not limited to municipal roads and streets, access roads,
23bridges, sidewalks, waste disposal systems, water and sewer
24line extensions, water distribution and purification
25facilities, storm water drainage and retention facilities, and
26sewage treatment facilities, resulting from a State or

 

 

HB5326- 38 -LRB097 14491 HLH 59346 b

1federally declared disaster in Illinois or bordering Illinois
2when such repairs are initiated on facilities located in the
3declared disaster area within 6 months after the disaster.
4    (20) Beginning July 1, 1999, game or game birds sold at a
5"game breeding and hunting preserve area" as that term is used
6in the Wildlife Code. This paragraph is exempt from the
7provisions of Section 3-55.
8    (21) A motor vehicle, as that term is defined in Section
91-146 of the Illinois Vehicle Code, that is donated to a
10corporation, limited liability company, society, association,
11foundation, or institution that is determined by the Department
12to be organized and operated exclusively for educational
13purposes. For purposes of this exemption, "a corporation,
14limited liability company, society, association, foundation,
15or institution organized and operated exclusively for
16educational purposes" means all tax-supported public schools,
17private schools that offer systematic instruction in useful
18branches of learning by methods common to public schools and
19that compare favorably in their scope and intensity with the
20course of study presented in tax-supported schools, and
21vocational or technical schools or institutes organized and
22operated exclusively to provide a course of study of not less
23than 6 weeks duration and designed to prepare individuals to
24follow a trade or to pursue a manual, technical, mechanical,
25industrial, business, or commercial occupation.
26    (22) Beginning January 1, 2000, personal property,

 

 

HB5326- 39 -LRB097 14491 HLH 59346 b

1including food, purchased through fundraising events for the
2benefit of a public or private elementary or secondary school,
3a group of those schools, or one or more school districts if
4the events are sponsored by an entity recognized by the school
5district that consists primarily of volunteers and includes
6parents and teachers of the school children. This paragraph
7does not apply to fundraising events (i) for the benefit of
8private home instruction or (ii) for which the fundraising
9entity purchases the personal property sold at the events from
10another individual or entity that sold the property for the
11purpose of resale by the fundraising entity and that profits
12from the sale to the fundraising entity. This paragraph is
13exempt from the provisions of Section 3-55.
14    (23) Beginning January 1, 2000 and through December 31,
152001, new or used automatic vending machines that prepare and
16serve hot food and beverages, including coffee, soup, and other
17items, and replacement parts for these machines. Beginning
18January 1, 2002 and through June 30, 2003, machines and parts
19for machines used in commercial, coin-operated amusement and
20vending business if a use or occupation tax is paid on the
21gross receipts derived from the use of the commercial,
22coin-operated amusement and vending machines. This paragraph
23is exempt from the provisions of Section 3-55.
24    (24) Beginning on the effective date of this amendatory Act
25of the 92nd General Assembly, computers and communications
26equipment utilized for any hospital purpose and equipment used

 

 

HB5326- 40 -LRB097 14491 HLH 59346 b

1in the diagnosis, analysis, or treatment of hospital patients
2sold to a lessor who leases the equipment, under a lease of one
3year or longer executed or in effect at the time of the
4purchase, to a hospital that has been issued an active tax
5exemption identification number by the Department under
6Section 1g of the Retailers' Occupation Tax Act. This paragraph
7is exempt from the provisions of Section 3-55.
8    (25) Beginning on the effective date of this amendatory Act
9of the 92nd General Assembly, personal property sold to a
10lessor who leases the property, under a lease of one year or
11longer executed or in effect at the time of the purchase, to a
12governmental body that has been issued an active tax exemption
13identification number by the Department under Section 1g of the
14Retailers' Occupation Tax Act. This paragraph is exempt from
15the provisions of Section 3-55.
16    (26) Beginning on January 1, 2002 and through June 30,
172016, tangible personal property purchased from an Illinois
18retailer by a taxpayer engaged in centralized purchasing
19activities in Illinois who will, upon receipt of the property
20in Illinois, temporarily store the property in Illinois (i) for
21the purpose of subsequently transporting it outside this State
22for use or consumption thereafter solely outside this State or
23(ii) for the purpose of being processed, fabricated, or
24manufactured into, attached to, or incorporated into other
25tangible personal property to be transported outside this State
26and thereafter used or consumed solely outside this State. The

 

 

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1Director of Revenue shall, pursuant to rules adopted in
2accordance with the Illinois Administrative Procedure Act,
3issue a permit to any taxpayer in good standing with the
4Department who is eligible for the exemption under this
5paragraph (26). The permit issued under this paragraph (26)
6shall authorize the holder, to the extent and in the manner
7specified in the rules adopted under this Act, to purchase
8tangible personal property from a retailer exempt from the
9taxes imposed by this Act. Taxpayers shall maintain all
10necessary books and records to substantiate the use and
11consumption of all such tangible personal property outside of
12the State of Illinois.
13    (27) Beginning January 1, 2008, tangible personal property
14used in the construction or maintenance of a community water
15supply, as defined under Section 3.145 of the Environmental
16Protection Act, that is operated by a not-for-profit
17corporation that holds a valid water supply permit issued under
18Title IV of the Environmental Protection Act. This paragraph is
19exempt from the provisions of Section 3-55.
20    (28) Tangible personal property sold to a
21public-facilities corporation, as described in Section
2211-65-10 of the Illinois Municipal Code, for purposes of
23constructing or furnishing a municipal convention hall, but
24only if the legal title to the municipal convention hall is
25transferred to the municipality without any further
26consideration by or on behalf of the municipality at the time

 

 

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1of the completion of the municipal convention hall or upon the
2retirement or redemption of any bonds or other debt instruments
3issued by the public-facilities corporation in connection with
4the development of the municipal convention hall. This
5exemption includes existing public-facilities corporations as
6provided in Section 11-65-25 of the Illinois Municipal Code.
7This paragraph is exempt from the provisions of Section 3-55.
8    (29) Beginning January 1, 2010, materials, parts,
9equipment, components, and furnishings incorporated into or
10upon an aircraft as part of the modification, refurbishment,
11completion, replacement, repair, or maintenance of the
12aircraft. This exemption includes consumable supplies used in
13the modification, refurbishment, completion, replacement,
14repair, and maintenance of aircraft, but excludes any
15materials, parts, equipment, components, and consumable
16supplies used in the modification, replacement, repair, and
17maintenance of aircraft engines or power plants, whether such
18engines or power plants are installed or uninstalled upon any
19such aircraft. "Consumable supplies" include, but are not
20limited to, adhesive, tape, sandpaper, general purpose
21lubricants, cleaning solution, latex gloves, and protective
22films. This exemption applies only to those organizations that
23(i) hold an Air Agency Certificate and are empowered to operate
24an approved repair station by the Federal Aviation
25Administration, (ii) have a Class IV Rating, and (iii) conduct
26operations in accordance with Part 145 of the Federal Aviation

 

 

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1Regulations. The exemption does not include aircraft operated
2by a commercial air carrier providing scheduled passenger air
3service pursuant to authority issued under Part 121 or Part 129
4of the Federal Aviation Regulations.
5    (30) From August 15th through November 15th of each year
6beginning in 2012, propane used for agricultural purposes. This
7paragraph is exempt from the provisions of Section 3-55.
8(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
996-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
107-2-10; 97-38, eff. 6-28-11; 97-73, eff. 6-30-11; 97-227, eff.
111-1-12; 97-431, eff. 8-16-11; revised 9-12-11.)
 
12    Section 20. The Retailers' Occupation Tax Act is amended by
13changing Section 2-5 as follows:
 
14    (35 ILCS 120/2-5)
15    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
16sale of the following tangible personal property are exempt
17from the tax imposed by this Act:
18    (1) Farm chemicals.
19    (2) Farm machinery and equipment, both new and used,
20including that manufactured on special order, certified by the
21purchaser to be used primarily for production agriculture or
22State or federal agricultural programs, including individual
23replacement parts for the machinery and equipment, including
24machinery and equipment purchased for lease, and including

 

 

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

 

 

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1crop data for the purpose of formulating animal diets and
2agricultural chemicals. This item (2) (7) is exempt from the
3provisions of Section 2-70.
4    (3) Until July 1, 2003, distillation machinery and
5equipment, sold as a unit or kit, assembled or installed by the
6retailer, certified by the user to be used only for the
7production of ethyl alcohol that will be used for consumption
8as motor fuel or as a component of motor fuel for the personal
9use of the user, and not subject to sale or resale.
10    (4) Until July 1, 2003 and beginning again September 1,
112004 through August 30, 2014, graphic arts machinery and
12equipment, including repair and replacement parts, both new and
13used, and including that manufactured on special order or
14purchased for lease, certified by the purchaser to be used
15primarily for graphic arts production. Equipment includes
16chemicals or chemicals acting as catalysts but only if the
17chemicals or chemicals acting as catalysts effect a direct and
18immediate change upon a graphic arts product.
19    (5) A motor vehicle of the first division, a motor vehicle
20of the second division that is a self contained motor vehicle
21designed or permanently converted to provide living quarters
22for recreational, camping, or travel use, with direct walk
23through access to the living quarters from the driver's seat,
24or a motor vehicle of the second division that is of the van
25configuration designed for the transportation of not less than
267 nor more than 16 passengers, as defined in Section 1-146 of

 

 

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1the Illinois Vehicle Code, that is used for automobile renting,
2as defined in the Automobile Renting Occupation and Use Tax
3Act. This paragraph is exempt from the provisions of Section
42-70.
5    (6) Personal property sold by a teacher-sponsored student
6organization affiliated with an elementary or secondary school
7located in Illinois.
8    (7) Until July 1, 2003, proceeds of that portion of the
9selling price of a passenger car the sale of which is subject
10to the Replacement Vehicle Tax.
11    (8) Personal property sold to an Illinois county fair
12association for use in conducting, operating, or promoting the
13county fair.
14    (9) Personal property sold to a not-for-profit arts or
15cultural organization that establishes, by proof required by
16the Department by rule, that it has received an exemption under
17Section 501(c)(3) of the Internal Revenue Code and that is
18organized and operated primarily for the presentation or
19support of arts or cultural programming, activities, or
20services. These organizations include, but are not limited to,
21music and dramatic arts organizations such as symphony
22orchestras and theatrical groups, arts and cultural service
23organizations, local arts councils, visual arts organizations,
24and media arts organizations. On and after the effective date
25of this amendatory Act of the 92nd General Assembly, however,
26an entity otherwise eligible for this exemption shall not make

 

 

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1tax-free purchases unless it has an active identification
2number issued by the Department.
3    (10) Personal property sold by a corporation, society,
4association, foundation, institution, or organization, other
5than a limited liability company, that is organized and
6operated as a not-for-profit service enterprise for the benefit
7of persons 65 years of age or older if the personal property
8was not purchased by the enterprise for the purpose of resale
9by the enterprise.
10    (11) Personal property sold to a governmental body, to a
11corporation, society, association, foundation, or institution
12organized and operated exclusively for charitable, religious,
13or educational purposes, or to a not-for-profit corporation,
14society, association, foundation, institution, or organization
15that has no compensated officers or employees and that is
16organized and operated primarily for the recreation of persons
1755 years of age or older. A limited liability company may
18qualify for the exemption under this paragraph only if the
19limited liability company is organized and operated
20exclusively for educational purposes. On and after July 1,
211987, however, no entity otherwise eligible for this exemption
22shall make tax-free purchases unless it has an active
23identification number issued by the Department.
24    (12) Tangible personal property sold to interstate
25carriers for hire for use as rolling stock moving in interstate
26commerce or to lessors under leases of one year or longer

 

 

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1executed or in effect at the time of purchase by interstate
2carriers for hire for use as rolling stock moving in interstate
3commerce and equipment operated by a telecommunications
4provider, licensed as a common carrier by the Federal
5Communications Commission, which is permanently installed in
6or affixed to aircraft moving in interstate commerce.
7    (12-5) On and after July 1, 2003 and through June 30, 2004,
8motor vehicles of the second division with a gross vehicle
9weight in excess of 8,000 pounds that are subject to the
10commercial distribution fee imposed under Section 3-815.1 of
11the Illinois Vehicle Code. Beginning on July 1, 2004 and
12through June 30, 2005, the use in this State of motor vehicles
13of the second division: (i) with a gross vehicle weight rating
14in excess of 8,000 pounds; (ii) that are subject to the
15commercial distribution fee imposed under Section 3-815.1 of
16the Illinois Vehicle Code; and (iii) that are primarily used
17for commercial purposes. Through June 30, 2005, this exemption
18applies to repair and replacement parts added after the initial
19purchase of such a motor vehicle if that motor vehicle is used
20in a manner that would qualify for the rolling stock exemption
21otherwise provided for in this Act. For purposes of this
22paragraph, "used for commercial purposes" means the
23transportation of persons or property in furtherance of any
24commercial or industrial enterprise whether for-hire or not.
25    (13) Proceeds from sales to owners, lessors, or shippers of
26tangible personal property that is utilized by interstate

 

 

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1carriers for hire for use as rolling stock moving in interstate
2commerce and equipment operated by a telecommunications
3provider, licensed as a common carrier by the Federal
4Communications Commission, which is permanently installed in
5or affixed to aircraft moving in interstate commerce.
6    (14) Machinery and equipment that will be used by the
7purchaser, or a lessee of the purchaser, primarily in the
8process of manufacturing or assembling tangible personal
9property for wholesale or retail sale or lease, whether the
10sale or lease is made directly by the manufacturer or by some
11other person, whether the materials used in the process are
12owned by the manufacturer or some other person, or whether the
13sale or lease is made apart from or as an incident to the
14seller's engaging in the service occupation of producing
15machines, tools, dies, jigs, patterns, gauges, or other similar
16items of no commercial value on special order for a particular
17purchaser.
18    (15) Proceeds of mandatory service charges separately
19stated on customers' bills for purchase and consumption of food
20and beverages, to the extent that the proceeds of the service
21charge are in fact turned over as tips or as a substitute for
22tips to the employees who participate directly in preparing,
23serving, hosting or cleaning up the food or beverage function
24with respect to which the service charge is imposed.
25    (16) Petroleum products sold to a purchaser if the seller
26is prohibited by federal law from charging tax to the

 

 

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

 

 

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1photoprocessing machinery and equipment purchased for lease.
2    (21) 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    (22) Fuel and petroleum products sold to or used by an air
9carrier, certified by the carrier to be used for consumption,
10shipment, or storage in the conduct of its business as an air
11common carrier, for a flight destined for or returning from a
12location or locations outside the United States without regard
13to previous or subsequent domestic stopovers.
14    (23) A transaction in which the purchase order is received
15by a florist who is located outside Illinois, but who has a
16florist located in Illinois deliver the property to the
17purchaser or the purchaser's donee in Illinois.
18    (24) Fuel consumed or used in the operation of ships,
19barges, or vessels that are used primarily in or for the
20transportation of property or the conveyance of persons for
21hire on rivers bordering on this State if the fuel is delivered
22by the seller to the purchaser's barge, ship, or vessel while
23it is afloat upon that bordering river.
24    (25) Except as provided in item (25-5) of this Section, a
25motor vehicle sold in this State to a nonresident even though
26the motor vehicle is delivered to the nonresident in this

 

 

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1State, if the motor vehicle is not to be titled in this State,
2and if a drive-away permit is issued to the motor vehicle as
3provided in Section 3-603 of the Illinois Vehicle Code or if
4the nonresident purchaser has vehicle registration plates to
5transfer to the motor vehicle upon returning to his or her home
6state. The issuance of the drive-away permit or having the
7out-of-state registration plates to be transferred is prima
8facie evidence that the motor vehicle will not be titled in
9this State.
10    (25-5) The exemption under item (25) does not apply if the
11state in which the motor vehicle will be titled does not allow
12a reciprocal exemption for a motor vehicle sold and delivered
13in that state to an Illinois resident but titled in Illinois.
14The tax collected under this Act on the sale of a motor vehicle
15in this State to a resident of another state that does not
16allow a reciprocal exemption shall be imposed at a rate equal
17to the state's rate of tax on taxable property in the state in
18which the purchaser is a resident, except that the tax shall
19not exceed the tax that would otherwise be imposed under this
20Act. At the time of the sale, the purchaser shall execute a
21statement, signed under penalty of perjury, of his or her
22intent to title the vehicle in the state in which the purchaser
23is a resident within 30 days after the sale and of the fact of
24the payment to the State of Illinois of tax in an amount
25equivalent to the state's rate of tax on taxable property in
26his or her state of residence and shall submit the statement to

 

 

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1the appropriate tax collection agency in his or her state of
2residence. In addition, the retailer must retain a signed copy
3of the statement in his or her records. Nothing in this item
4shall be construed to require the removal of the vehicle from
5this state following the filing of an intent to title the
6vehicle in the purchaser's state of residence if the purchaser
7titles the vehicle in his or her state of residence within 30
8days after the date of sale. The tax collected under this Act
9in accordance with this item (25-5) shall be proportionately
10distributed as if the tax were collected at the 6.25% general
11rate imposed under this Act.
12    (25-7) Beginning on July 1, 2007, no tax is imposed under
13this Act on the sale of an aircraft, as defined in Section 3 of
14the Illinois Aeronautics Act, if all of the following
15conditions are met:
16        (1) the aircraft leaves this State within 15 days after
17    the later of either the issuance of the final billing for
18    the sale of the aircraft, or the authorized approval for
19    return to service, completion of the maintenance record
20    entry, and completion of the test flight and ground test
21    for inspection, as required by 14 C.F.R. 91.407;
22        (2) the aircraft is not based or registered in this
23    State after the sale of the aircraft; and
24        (3) the seller retains in his or her books and records
25    and provides to the Department a signed and dated
26    certification from the purchaser, on a form prescribed by

 

 

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1    the Department, certifying that the requirements of this
2    item (25-7) are met. The certificate must also include the
3    name and address of the purchaser, the address of the
4    location where the aircraft is to be titled or registered,
5    the address of the primary physical location of the
6    aircraft, and other information that the Department may
7    reasonably require.
8    For purposes of this item (25-7):
9    "Based in this State" means hangared, stored, or otherwise
10used, excluding post-sale customizations as defined in this
11Section, for 10 or more days in each 12-month period
12immediately following the date of the sale of the aircraft.
13    "Registered in this State" means an aircraft registered
14with the Department of Transportation, Aeronautics Division,
15or titled or registered with the Federal Aviation
16Administration to an address located in this State.
17    This paragraph (25-7) is exempt from the provisions of
18Section 2-70.
19    (26) Semen used for artificial insemination of livestock
20for direct agricultural production.
21    (27) 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 (27) is exempt from the provisions

 

 

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1of Section 2-70, and the exemption provided for under this item
2(27) applies for all periods beginning May 30, 1995, but no
3claim for credit or refund is allowed on or after January 1,
42008 (the effective date of Public Act 95-88) for such taxes
5paid during the period beginning May 30, 2000 and ending on
6January 1, 2008 (the effective date of Public Act 95-88).
7    (28) Computers and communications equipment utilized for
8any hospital purpose and equipment used in the diagnosis,
9analysis, or treatment of hospital patients sold to a lessor
10who leases the equipment, under a lease of one year or longer
11executed or in effect at the time of the purchase, to a
12hospital that has been issued an active tax exemption
13identification number by the Department under Section 1g of
14this Act.
15    (29) Personal property sold to a lessor who leases the
16property, under a lease of one year or longer executed or in
17effect at the time of the purchase, to a governmental body that
18has been issued an active tax exemption identification number
19by the Department under Section 1g of this Act.
20    (30) Beginning with taxable years ending on or after
21December 31, 1995 and ending with taxable years ending on or
22before December 31, 2004, personal property that is donated for
23disaster relief to be used in a State or federally declared
24disaster area in Illinois or bordering Illinois by a
25manufacturer or retailer that is registered in this State to a
26corporation, society, association, foundation, or institution

 

 

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1that has been issued a sales tax exemption identification
2number by the Department that assists victims of the disaster
3who reside within the declared disaster area.
4    (31) Beginning with taxable years ending on or after
5December 31, 1995 and ending with taxable years ending on or
6before December 31, 2004, personal property that is used in the
7performance of infrastructure repairs in this State, including
8but not limited to municipal roads and streets, access roads,
9bridges, sidewalks, waste disposal systems, water and sewer
10line extensions, water distribution and purification
11facilities, storm water drainage and retention facilities, and
12sewage treatment facilities, resulting from a State or
13federally declared disaster in Illinois or bordering Illinois
14when such repairs are initiated on facilities located in the
15declared disaster area within 6 months after the disaster.
16    (32) Beginning July 1, 1999, game or game birds sold at a
17"game breeding and hunting preserve area" as that term is used
18in the Wildlife Code. This paragraph is exempt from the
19provisions of Section 2-70.
20    (33) A motor vehicle, as that term is defined in Section
211-146 of the Illinois Vehicle Code, that is donated to a
22corporation, limited liability company, society, association,
23foundation, or institution that is determined by the Department
24to be organized and operated exclusively for educational
25purposes. For purposes of this exemption, "a corporation,
26limited liability company, society, association, foundation,

 

 

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1or institution organized and operated exclusively for
2educational purposes" means all tax-supported public schools,
3private schools that offer systematic instruction in useful
4branches of learning by methods common to public schools and
5that compare favorably in their scope and intensity with the
6course of study presented in tax-supported schools, and
7vocational or technical schools or institutes organized and
8operated exclusively to provide a course of study of not less
9than 6 weeks duration and designed to prepare individuals to
10follow a trade or to pursue a manual, technical, mechanical,
11industrial, business, or commercial occupation.
12    (34) Beginning January 1, 2000, personal property,
13including food, purchased through fundraising events for the
14benefit of a public or private elementary or secondary school,
15a group of those schools, or one or more school districts if
16the events are sponsored by an entity recognized by the school
17district that consists primarily of volunteers and includes
18parents and teachers of the school children. This paragraph
19does not apply to fundraising events (i) for the benefit of
20private home instruction or (ii) for which the fundraising
21entity purchases the personal property sold at the events from
22another individual or entity that sold the property for the
23purpose of resale by the fundraising entity and that profits
24from the sale to the fundraising entity. This paragraph is
25exempt from the provisions of Section 2-70.
26    (35) Beginning January 1, 2000 and through December 31,

 

 

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12001, new or used automatic vending machines that prepare and
2serve hot food and beverages, including coffee, soup, and other
3items, and replacement parts for these machines. Beginning
4January 1, 2002 and through June 30, 2003, machines and parts
5for machines used in commercial, coin-operated amusement and
6vending business if a use or occupation tax is paid on the
7gross receipts derived from the use of the commercial,
8coin-operated amusement and vending machines. This paragraph
9is exempt from the provisions of Section 2-70.
10    (35-5) Beginning August 23, 2001 and through June 30, 2011,
11food for human consumption that is to be consumed off the
12premises where it is sold (other than alcoholic beverages, soft
13drinks, and food that has been prepared for immediate
14consumption) and prescription and nonprescription medicines,
15drugs, medical appliances, and insulin, urine testing
16materials, syringes, and needles used by diabetics, for human
17use, when purchased for use by a person receiving medical
18assistance under Article V of the Illinois Public Aid Code who
19resides in a licensed long-term care facility, as defined in
20the Nursing Home Care Act, or a licensed facility as defined in
21the ID/DD Community Care Act or the Specialized Mental Health
22Rehabilitation Act.
23    (36) Beginning August 2, 2001, computers and
24communications equipment utilized for any hospital purpose and
25equipment used in the diagnosis, analysis, or treatment of
26hospital patients sold to a lessor who leases the equipment,

 

 

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1under a lease of one year or longer executed or in effect at
2the time of the purchase, to a hospital that has been issued an
3active tax exemption identification number by the Department
4under Section 1g of this Act. This paragraph is exempt from the
5provisions of Section 2-70.
6    (37) Beginning August 2, 2001, personal property sold to a
7lessor who leases the property, under a lease of one year or
8longer executed or in effect at the time of the purchase, to a
9governmental body that has been issued an active tax exemption
10identification number by the Department under Section 1g of
11this Act. This paragraph is exempt from the provisions of
12Section 2-70.
13    (38) Beginning on January 1, 2002 and through June 30,
142016, tangible personal property purchased from an Illinois
15retailer by a taxpayer engaged in centralized purchasing
16activities in Illinois who will, upon receipt of the property
17in Illinois, temporarily store the property in Illinois (i) for
18the purpose of subsequently transporting it outside this State
19for use or consumption thereafter solely outside this State or
20(ii) for the purpose of being processed, fabricated, or
21manufactured into, attached to, or incorporated into other
22tangible personal property to be transported outside this State
23and thereafter used or consumed solely outside this State. The
24Director of Revenue shall, pursuant to rules adopted in
25accordance with the Illinois Administrative Procedure Act,
26issue a permit to any taxpayer in good standing with the

 

 

HB5326- 60 -LRB097 14491 HLH 59346 b

1Department who is eligible for the exemption under this
2paragraph (38). The permit issued under this paragraph (38)
3shall authorize the holder, to the extent and in the manner
4specified in the rules adopted under this Act, to purchase
5tangible personal property from a retailer exempt from the
6taxes imposed by this Act. Taxpayers shall maintain all
7necessary books and records to substantiate the use and
8consumption of all such tangible personal property outside of
9the State of Illinois.
10    (39) 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 2-70.
17    (40) 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    (41) Tangible personal property sold to 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 2-70.
2    (42) From August 15th through November 15th of each year
3beginning in 2012, propane used for agricultural purposes. This
4paragraph is exempt from the provisions of Section 2-70.
5(Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
696-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
77-2-10; 97-38, eff. 6-28-11; 97-73, eff. 6-30-11; 97-227, eff.
81-1-12; 97-431, eff. 8-16-11; revised 9-12-11.)
 
9    Section 99. Effective date. This Act takes effect upon
10becoming law.