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| | 99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016 HB3694 Introduced , by Rep. Katherine Cloonen SYNOPSIS AS INTRODUCED: |
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35 ILCS 105/2 | from Ch. 120, par. 439.2 |
35 ILCS 110/2 | from Ch. 120, par. 439.32 |
35 ILCS 120/1 | from Ch. 120, par. 440 |
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Amends the Use Tax Act, the Service Use Tax Act, and the Retailers' Occupation Tax Act. Provides that the term "selling price" does not include any fee charged by the retailer for the disposal of tires if that fee is a separately stated charge on the customer's invoice.
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| | | FISCAL NOTE ACT MAY APPLY | |
| | A BILL FOR |
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1 | | AN ACT concerning revenue.
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2 | | Be it enacted by the People of the State of Illinois,
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3 | | represented in the General Assembly:
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4 | | Section 5. The Use Tax Act is amended by changing Section 2 |
5 | | as follows:
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6 | | (35 ILCS 105/2) (from Ch. 120, par. 439.2)
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7 | | Sec. 2. Definitions. |
8 | | "Use" means the exercise by any person of any right or |
9 | | power over
tangible personal property incident to the ownership |
10 | | of that property,
except that it does not include the sale of |
11 | | such property in any form as
tangible personal property in the |
12 | | regular course of business to the extent
that such property is |
13 | | not first subjected to a use for which it was
purchased, and |
14 | | does not include the use of such property by its owner for
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15 | | demonstration purposes: Provided that the property purchased |
16 | | is deemed to
be purchased for the purpose of resale, despite |
17 | | first being used, to the
extent to which it is resold as an |
18 | | ingredient of an intentionally produced
product or by-product |
19 | | of manufacturing. "Use" does not mean the demonstration
use or |
20 | | interim use of tangible personal property by a retailer before |
21 | | he sells
that tangible personal property. For watercraft or |
22 | | aircraft, if the period of
demonstration use or interim use by |
23 | | the retailer exceeds 18 months,
the retailer
shall pay on the |
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1 | | retailers' original cost price the tax imposed by this Act,
and |
2 | | no credit for that tax is permitted if the watercraft or |
3 | | aircraft is
subsequently sold by the retailer. "Use" does not |
4 | | mean the physical
incorporation of tangible personal property, |
5 | | to the extent not first subjected
to a use for which it was |
6 | | purchased, as an ingredient or constituent, into
other tangible |
7 | | personal property (a) which is sold in the regular course of
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8 | | business or (b) which the person incorporating such ingredient |
9 | | or constituent
therein has undertaken at the time of such |
10 | | purchase to cause to be transported
in interstate commerce to |
11 | | destinations outside the State of Illinois: Provided
that the |
12 | | property purchased is deemed to be purchased for the purpose of
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13 | | resale, despite first being used, to the extent to which it is |
14 | | resold as an
ingredient of an intentionally produced product or |
15 | | by-product of manufacturing.
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16 | | "Watercraft" means a Class 2, Class 3, or Class 4 |
17 | | watercraft as defined in
Section 3-2 of the Boat Registration |
18 | | and Safety Act, a personal watercraft, or
any boat equipped |
19 | | with an inboard motor.
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20 | | "Purchase at retail" means the acquisition of the ownership |
21 | | of or title
to tangible personal property through a sale at |
22 | | retail.
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23 | | "Purchaser" means anyone who, through a sale at retail, |
24 | | acquires the
ownership of tangible personal property for a |
25 | | valuable consideration.
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26 | | "Sale at retail" means any transfer of the ownership of or |
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1 | | title to
tangible personal property to a purchaser, for the |
2 | | purpose of use, and not
for the purpose of resale in any form |
3 | | as tangible personal property to the
extent not first subjected |
4 | | to a use for which it was purchased, for a
valuable |
5 | | consideration: Provided that the property purchased is deemed |
6 | | to
be purchased for the purpose of resale, despite first being |
7 | | used, to the
extent to which it is resold as an ingredient of |
8 | | an intentionally produced
product or by-product of |
9 | | manufacturing. For this purpose, slag produced as
an incident |
10 | | to manufacturing pig iron or steel and sold is considered to be
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11 | | an intentionally produced by-product of manufacturing. "Sale |
12 | | at retail"
includes any such transfer made for resale unless |
13 | | made in compliance with
Section 2c of the Retailers' Occupation |
14 | | Tax Act, as incorporated by
reference into Section 12 of this |
15 | | Act. Transactions whereby the possession
of the property is |
16 | | transferred but the seller retains the title as security
for |
17 | | payment of the selling price are sales.
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18 | | "Sale at retail" shall also be construed to include any |
19 | | Illinois
florist's sales transaction in which the purchase |
20 | | order is received in
Illinois by a florist and the sale is for |
21 | | use or consumption, but the
Illinois florist has a florist in |
22 | | another state deliver the property to the
purchaser or the |
23 | | purchaser's donee in such other state.
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24 | | Nonreusable tangible personal property that is used by |
25 | | persons engaged in
the business of operating a restaurant, |
26 | | cafeteria, or drive-in is a sale for
resale when it is |
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1 | | transferred to customers in the ordinary course of business
as |
2 | | part of the sale of food or beverages and is used to deliver, |
3 | | package, or
consume food or beverages, regardless of where |
4 | | consumption of the food or
beverages occurs. Examples of those |
5 | | items include, but are not limited to
nonreusable, paper and |
6 | | plastic cups, plates, baskets, boxes, sleeves, buckets
or other |
7 | | containers, utensils, straws, placemats, napkins, doggie bags, |
8 | | and
wrapping or packaging
materials that are transferred to |
9 | | customers as part of the sale of food or
beverages in the |
10 | | ordinary course of business.
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11 | | The purchase, employment and transfer of such tangible |
12 | | personal property
as newsprint and ink for the primary purpose |
13 | | of conveying news (with or
without other information) is not a |
14 | | purchase, use or sale of tangible
personal property.
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15 | | "Selling price" means the consideration for a sale valued |
16 | | in money
whether received in money or otherwise, including |
17 | | cash, credits, property
other than as hereinafter provided, and |
18 | | services, but not including the
value of or credit given for |
19 | | traded-in tangible personal property where the
item that is |
20 | | traded-in is of like kind and character as that which is being
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21 | | sold, and shall be determined without any deduction on account |
22 | | of the cost
of the property sold, the cost of materials used, |
23 | | labor or service cost or
any other expense whatsoever, but does |
24 | | not include interest or finance
charges which appear as |
25 | | separate items on the bill of sale or sales
contract nor |
26 | | charges that are added to prices by sellers on account of the
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1 | | seller's tax liability under the "Retailers' Occupation Tax |
2 | | Act", or on
account of the seller's duty to collect, from the |
3 | | purchaser, the tax that
is imposed by this Act, or, except as |
4 | | otherwise provided with respect to any cigarette tax imposed by |
5 | | a home rule unit, on account of the seller's tax liability |
6 | | under any local occupation tax administered by the Department, |
7 | | or, except as otherwise provided with respect to any cigarette |
8 | | tax imposed by a home rule unit on account of the seller's duty |
9 | | to collect, from the purchasers, the tax that is imposed under |
10 | | any local use tax administered by the Department. Effective |
11 | | December 1, 1985, "selling price"
shall include charges that |
12 | | are added to prices by sellers on account of the
seller's tax |
13 | | liability under the Cigarette Tax Act, on account of the |
14 | | seller's
duty to collect, from the purchaser, the tax imposed |
15 | | under the Cigarette Use
Tax Act, and on account of the seller's |
16 | | duty to collect, from the purchaser,
any cigarette tax imposed |
17 | | by a home rule unit.
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18 | | Notwithstanding any other provision of law, "selling |
19 | | price" does not include any fee charged by the retailer for the |
20 | | disposal of tires if that fee is a separately stated charge on |
21 | | the customer's invoice. |
22 | | Notwithstanding any law to the contrary, for any motor |
23 | | vehicle, as defined in Section 1-146 of the Vehicle Code, that |
24 | | is sold on or after January 1, 2015 for the purpose of leasing |
25 | | the vehicle for a defined period that is longer than one year |
26 | | and (1) is a motor vehicle of the second division that: (A) is |
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1 | | a self-contained motor vehicle designed or permanently |
2 | | converted to provide living quarters for recreational, |
3 | | camping, or travel use, with direct walk through access to the |
4 | | living quarters from the driver's seat; (B) is of the van |
5 | | configuration designed for the transportation of not less than |
6 | | 7 nor more than 16 passengers; or (C) has a gross vehicle |
7 | | weight rating of 8,000 pounds or less or (2) is a motor vehicle |
8 | | of the first division, "selling price" or "amount of sale" |
9 | | means the consideration received by the lessor pursuant to the |
10 | | lease contract, including amounts due at lease signing and all |
11 | | monthly or other regular payments charged over the term of the |
12 | | lease. Also included in the selling price is any amount |
13 | | received by the lessor from the lessee for the leased vehicle |
14 | | that is not calculated at the time the lease is executed, |
15 | | including, but not limited to, excess mileage charges and |
16 | | charges for excess wear and tear. For sales that occur in |
17 | | Illinois, with respect to any amount received by the lessor |
18 | | from the lessee for the leased vehicle that is not calculated |
19 | | at the time the lease is executed, the lessor who purchased the |
20 | | motor vehicle does not incur the tax imposed by the Use Tax Act |
21 | | on those amounts, and the retailer who makes the retail sale of |
22 | | the motor vehicle to the lessor is not required to collect the |
23 | | tax imposed by this Act or to pay the tax imposed by the |
24 | | Retailers' Occupation Tax Act on those amounts. However, the |
25 | | lessor who purchased the motor vehicle assumes the liability |
26 | | for reporting and paying the tax on those amounts directly to |
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1 | | the Department in the same form (Illinois Retailers' Occupation |
2 | | Tax, and local retailers' occupation taxes, if applicable) in |
3 | | which the retailer would have reported and paid such tax if the |
4 | | retailer had accounted for the tax to the Department. For |
5 | | amounts received by the lessor from the lessee that are not |
6 | | calculated at the time the lease is executed, the lessor must |
7 | | file the return and pay the tax to the Department by the due |
8 | | date otherwise required by this Act for returns other than |
9 | | transaction returns. If the retailer is entitled under this Act |
10 | | to a discount for collecting and remitting the tax imposed |
11 | | under this Act to the Department with respect to the sale of |
12 | | the motor vehicle to the lessor, then the right to the discount |
13 | | provided in this Act shall be transferred to the lessor with |
14 | | respect to the tax paid by the lessor for any amount received |
15 | | by the lessor from the lessee for the leased vehicle that is |
16 | | not calculated at the time the lease is executed; provided that |
17 | | the discount is only allowed if the return is timely filed and |
18 | | for amounts timely paid. The "selling price" of a motor vehicle |
19 | | that is sold on or after January 1, 2015 for the purpose of |
20 | | leasing for a defined period of longer than one year shall not |
21 | | be reduced by the value of or credit given for traded-in |
22 | | tangible personal property owned by the lessor, nor shall it be |
23 | | reduced by the value of or credit given for traded-in tangible |
24 | | personal property owned by the lessee, regardless of whether |
25 | | the trade-in value thereof is assigned by the lessee to the |
26 | | lessor. In the case of a motor vehicle that is sold for the |
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1 | | purpose of leasing for a defined period of longer than one |
2 | | year, the sale occurs at the time of the delivery of the |
3 | | vehicle, regardless of the due date of any lease payments. A |
4 | | lessor who incurs a Retailers' Occupation Tax liability on the |
5 | | sale of a motor vehicle coming off lease may not take a credit |
6 | | against that liability for the Use Tax the lessor paid upon the |
7 | | purchase of the motor vehicle (or for any tax the lessor paid |
8 | | with respect to any amount received by the lessor from the |
9 | | lessee for the leased vehicle that was not calculated at the |
10 | | time the lease was executed) if the selling price of the motor |
11 | | vehicle at the time of purchase was calculated using the |
12 | | definition of "selling price" as defined in this paragraph. |
13 | | Notwithstanding any other provision of this Act to the |
14 | | contrary, lessors shall file all returns and make all payments |
15 | | required under this paragraph to the Department by electronic |
16 | | means in the manner and form as required by the Department. |
17 | | This paragraph does not apply to leases of motor vehicles for |
18 | | which, at the time the lease is entered into, the term of the |
19 | | lease is not a defined period, including leases with a defined |
20 | | initial period with the option to continue the lease on a |
21 | | month-to-month or other basis beyond the initial defined |
22 | | period. |
23 | | The phrase "like kind and character" shall be liberally |
24 | | construed
(including but not limited to any form of motor |
25 | | vehicle for any form of
motor vehicle, or any kind of farm or |
26 | | agricultural implement for any other
kind of farm or |
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1 | | agricultural implement), while not including a kind of item
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2 | | which, if sold at retail by that retailer, would be exempt from |
3 | | retailers'
occupation tax and use tax as an isolated or |
4 | | occasional sale.
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5 | | "Department" means the Department of Revenue.
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6 | | "Person" means any natural individual, firm, partnership, |
7 | | association,
joint stock company, joint adventure, public or |
8 | | private corporation, limited
liability company, or a
receiver, |
9 | | executor, trustee, guardian or other representative appointed
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10 | | by order of any court.
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11 | | "Retailer" means and includes every person engaged in the |
12 | | business of
making sales at retail as defined in this Section.
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13 | | A person who holds himself or herself out as being engaged |
14 | | (or who habitually
engages) in selling tangible personal |
15 | | property at retail is a retailer
hereunder with respect to such |
16 | | sales (and not primarily in a service
occupation) |
17 | | notwithstanding the fact that such person designs and produces
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18 | | such tangible personal property on special order for the |
19 | | purchaser and in
such a way as to render the property of value |
20 | | only to such purchaser, if
such tangible personal property so |
21 | | produced on special order serves
substantially the same |
22 | | function as stock or standard items of tangible
personal |
23 | | property that are sold at retail.
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24 | | A person whose activities are organized and conducted |
25 | | primarily as a
not-for-profit service enterprise, and who |
26 | | engages in selling tangible
personal property at retail |
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1 | | (whether to the public or merely to members and
their guests) |
2 | | is a retailer with respect to such transactions, excepting
only |
3 | | a person organized and operated exclusively for charitable, |
4 | | religious
or educational purposes either (1), to the extent of |
5 | | sales by such person
to its members, students, patients or |
6 | | inmates of tangible personal property
to be used primarily for |
7 | | the purposes of such person, or (2), to the extent
of sales by |
8 | | such person of tangible personal property which is not sold or
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9 | | offered for sale by persons organized for profit. The selling |
10 | | of school
books and school supplies by schools at retail to |
11 | | students is not
"primarily for the purposes of" the school |
12 | | which does such selling. This
paragraph does not apply to nor |
13 | | subject to taxation occasional dinners,
social or similar |
14 | | activities of a person organized and operated exclusively
for |
15 | | charitable, religious or educational purposes, whether or not |
16 | | such
activities are open to the public.
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17 | | A person who is the recipient of a grant or contract under |
18 | | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and |
19 | | serves meals to
participants in the federal Nutrition Program |
20 | | for the Elderly in return for
contributions established in |
21 | | amount by the individual participant pursuant
to a schedule of |
22 | | suggested fees as provided for in the federal Act is not a
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23 | | retailer under this Act with respect to such transactions.
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24 | | Persons who engage in the business of transferring tangible |
25 | | personal
property upon the redemption of trading stamps are |
26 | | retailers hereunder when
engaged in such business.
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1 | | The isolated or occasional sale of tangible personal |
2 | | property at retail
by a person who does not hold himself out as |
3 | | being engaged (or who does not
habitually engage) in selling |
4 | | such tangible personal property at retail or
a sale through a |
5 | | bulk vending machine does not make such person a retailer
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6 | | hereunder. However, any person who is engaged in a business |
7 | | which is not
subject to the tax imposed by the "Retailers' |
8 | | Occupation Tax Act" because
of involving the sale of or a |
9 | | contract to sell real estate or a
construction contract to |
10 | | improve real estate, but who, in the course of
conducting such |
11 | | business, transfers tangible personal property to users or
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12 | | consumers in the finished form in which it was purchased, and |
13 | | which does
not become real estate, under any provision of a |
14 | | construction contract or
real estate sale or real estate sales |
15 | | agreement entered into with some
other person arising out of or |
16 | | because of such nontaxable business, is a
retailer to the |
17 | | extent of the value of the tangible personal property so
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18 | | transferred. If, in such transaction, a separate charge is made |
19 | | for the
tangible personal property so transferred, the value of |
20 | | such property, for
the purposes of this Act, is the amount so |
21 | | separately charged, but not less
than the cost of such property |
22 | | to the transferor; if no separate charge is
made, the value of |
23 | | such property, for the purposes of this Act, is the cost
to the |
24 | | transferor of such tangible personal property.
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25 | | "Retailer maintaining a place of business in this State", |
26 | | or any like
term, means and includes any of the following |
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1 | | retailers:
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2 | | 1. A retailer having or maintaining within this State, |
3 | | directly or by
a subsidiary, an office, distribution house, |
4 | | sales house, warehouse or other
place of business, or any |
5 | | agent or other representative operating within this
State |
6 | | under the authority of the retailer or its subsidiary, |
7 | | irrespective of
whether such place of business or agent or |
8 | | other representative is located here
permanently or |
9 | | temporarily, or whether such retailer or subsidiary is |
10 | | licensed
to do business in this State. However, the |
11 | | ownership of property that is
located at the premises of a |
12 | | printer with which the retailer has contracted for
printing |
13 | | and that consists of the final printed product, property |
14 | | that becomes
a part of the final printed product, or copy |
15 | | from which the printed product is
produced shall not result |
16 | | in the retailer being deemed to have or maintain an
office, |
17 | | distribution house, sales house, warehouse, or other place |
18 | | of business
within this State. |
19 | | 1.1. A retailer having a contract with a person located |
20 | | in this State under which the person, for a commission or |
21 | | other consideration based upon the sale of tangible |
22 | | personal property by the retailer, directly or indirectly |
23 | | refers potential customers to the retailer by providing to |
24 | | the potential customers a promotional code or other |
25 | | mechanism that allows the retailer to track purchases |
26 | | referred by such persons. Examples of mechanisms that allow |
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1 | | the retailer to track purchases referred by such persons |
2 | | include but are not limited to the use of a link on the |
3 | | person's Internet website, promotional codes distributed |
4 | | through the person's hand-delivered or mailed material, |
5 | | and promotional codes distributed by the person through |
6 | | radio or other broadcast media. The provisions of this |
7 | | paragraph 1.1 shall apply only if the cumulative gross |
8 | | receipts from sales of tangible personal property by the |
9 | | retailer to customers who are referred to the retailer by |
10 | | all persons in this State under such contracts exceed |
11 | | $10,000 during the preceding 4 quarterly periods ending on |
12 | | the last day of March, June, September, and December. A |
13 | | retailer meeting the requirements of this paragraph 1.1 |
14 | | shall be presumed to be maintaining a place of business in |
15 | | this State but may rebut this presumption by submitting |
16 | | proof that the referrals or other activities pursued within |
17 | | this State by such persons were not sufficient to meet the |
18 | | nexus standards of the United States Constitution during |
19 | | the preceding 4 quarterly periods. |
20 | | 1.2. Beginning July 1, 2011, a retailer having a |
21 | | contract with a person located in this State under which: |
22 | | A. the retailer sells the same or substantially |
23 | | similar line of products as the person located in this |
24 | | State and does so using an identical or substantially |
25 | | similar name, trade name, or trademark as the person |
26 | | located in this State; and |
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1 | | B. the retailer provides a commission or other |
2 | | consideration to the person located in this State based |
3 | | upon the sale of tangible personal property by the |
4 | | retailer. |
5 | | The provisions of this paragraph 1.2 shall apply only if |
6 | | the cumulative gross receipts from sales of tangible |
7 | | personal property by the retailer to customers in this |
8 | | State under all such contracts exceed $10,000 during the |
9 | | preceding 4 quarterly periods ending on the last day of |
10 | | March, June, September, and December.
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11 | | 2. A retailer soliciting orders for tangible personal |
12 | | property by
means of a telecommunication or television |
13 | | shopping system (which utilizes toll
free numbers) which is |
14 | | intended by the retailer to be broadcast by cable
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15 | | television or other means of broadcasting, to consumers |
16 | | located in this State.
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17 | | 3. A retailer, pursuant to a contract with a |
18 | | broadcaster or publisher
located in this State, soliciting |
19 | | orders for tangible personal property by
means of |
20 | | advertising which is disseminated primarily to consumers |
21 | | located in
this State and only secondarily to bordering |
22 | | jurisdictions.
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23 | | 4. A retailer soliciting orders for tangible personal |
24 | | property by mail
if the solicitations are substantial and |
25 | | recurring and if the retailer benefits
from any banking, |
26 | | financing, debt collection, telecommunication, or |
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1 | | marketing
activities occurring in this State or benefits |
2 | | from the location in this State
of authorized installation, |
3 | | servicing, or repair facilities.
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4 | | 5. A retailer that is owned or controlled by the same |
5 | | interests that own
or control any retailer engaging in |
6 | | business in the same or similar line of
business in this |
7 | | State.
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8 | | 6. A retailer having a franchisee or licensee operating |
9 | | under its trade
name if the franchisee or licensee is |
10 | | required to collect the tax under this
Section.
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11 | | 7. A retailer, pursuant to a contract with a cable |
12 | | television operator
located in this State, soliciting |
13 | | orders for tangible personal property by
means of |
14 | | advertising which is transmitted or distributed over a |
15 | | cable
television system in this State.
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16 | | 8. A retailer engaging in activities in Illinois, which |
17 | | activities in
the state in which the retail business |
18 | | engaging in such activities is located
would constitute |
19 | | maintaining a place of business in that state.
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20 | | "Bulk vending machine" means a vending machine,
containing |
21 | | unsorted confections, nuts, toys, or other items designed
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22 | | primarily to be used or played with by children
which, when a |
23 | | coin or coins of a denomination not larger than $0.50 are |
24 | | inserted, are dispensed in equal portions, at random and
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25 | | without selection by the customer.
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26 | | (Source: P.A. 98-628, eff. 1-1-15; 98-1080, eff. 8-26-14; |
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1 | | 98-1089, eff. 1-1-15; revised 10-1-14.)
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2 | | Section 10. The Service Use Tax Act is amended by changing |
3 | | Section 2 as follows:
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4 | | (35 ILCS 110/2) (from Ch. 120, par. 439.32)
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5 | | Sec. 2. Definitions. |
6 | | "Use" means the exercise by any person of any right or |
7 | | power
over tangible personal property incident to the ownership |
8 | | of that
property, but does not include the sale or use for |
9 | | demonstration by him
of that property in any form as tangible |
10 | | personal property in the
regular course of business.
"Use" does |
11 | | not mean the interim
use of
tangible personal property nor the |
12 | | physical incorporation of tangible
personal property, as an |
13 | | ingredient or constituent, into other tangible
personal |
14 | | property, (a) which is sold in the regular course of business
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15 | | or (b) which the person incorporating such ingredient or |
16 | | constituent
therein has undertaken at the time of such purchase |
17 | | to cause to be
transported in interstate commerce to |
18 | | destinations outside the State of
Illinois.
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19 | | "Purchased from a serviceman" means the acquisition of the |
20 | | ownership
of, or title to, tangible personal property through a |
21 | | sale of service.
|
22 | | "Purchaser" means any person who, through a sale of |
23 | | service, acquires
the ownership of, or title to, any tangible |
24 | | personal property.
|
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1 | | "Cost price" means the consideration paid by the serviceman |
2 | | for a
purchase valued in money, whether paid in money or |
3 | | otherwise, including
cash, credits and services, and shall be |
4 | | determined without any
deduction on account of the supplier's |
5 | | cost of the property sold or on
account of any other expense |
6 | | incurred by the supplier. When a serviceman
contracts out part |
7 | | or all of the services required in his sale of service,
it |
8 | | shall be presumed that the cost price to the serviceman of the |
9 | | property
transferred to him or her by his or her subcontractor |
10 | | is equal to 50% of
the subcontractor's charges to the |
11 | | serviceman in the absence of proof of
the consideration paid by |
12 | | the subcontractor for the purchase of such property.
|
13 | | "Selling price" means the consideration for a sale valued |
14 | | in money
whether received in money or otherwise, including |
15 | | cash, credits and
service, and shall be determined without any |
16 | | deduction on account of the
serviceman's cost of the property |
17 | | sold, the cost of materials used,
labor or service cost or any |
18 | | other expense whatsoever, but does not
include interest or |
19 | | finance charges which appear as separate items on
the bill of |
20 | | sale or sales contract nor charges that are added to prices
by |
21 | | sellers on account of the seller's duty to collect, from the
|
22 | | purchaser, the tax that is imposed by this Act.
|
23 | | Notwithstanding any other provision of law, "selling |
24 | | price" does not include any fee charged by the retailer for the |
25 | | disposal of tires if that fee is a separately stated charge on |
26 | | the customer's invoice. |
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1 | | "Department" means the Department of Revenue.
|
2 | | "Person" means any natural individual, firm, partnership,
|
3 | | association, joint stock company, joint venture, public or |
4 | | private
corporation, limited liability company, and any |
5 | | receiver, executor, trustee,
guardian or other representative |
6 | | appointed by order of any court.
|
7 | | "Sale of service" means any transaction except:
|
8 | | (1) a retail sale of tangible personal property taxable |
9 | | under the
Retailers' Occupation Tax Act or under the Use |
10 | | Tax Act.
|
11 | | (2) a sale of tangible personal property for the |
12 | | purpose of resale
made in compliance with Section 2c of the |
13 | | Retailers' Occupation Tax Act.
|
14 | | (3) except as hereinafter provided, a sale or transfer |
15 | | of tangible
personal property as an incident to the |
16 | | rendering of service for or by
any governmental body, or |
17 | | for or by any corporation, society,
association, |
18 | | foundation or institution organized and operated
|
19 | | exclusively for charitable, religious or educational |
20 | | purposes or any
not-for-profit corporation, society, |
21 | | association, foundation,
institution or organization which |
22 | | has no compensated officers or
employees and which is |
23 | | organized and operated primarily for the
recreation of |
24 | | persons 55 years of age or older. A limited liability |
25 | | company
may qualify for the exemption under this paragraph |
26 | | only if the limited
liability company is organized and |
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1 | | operated exclusively for educational
purposes.
|
2 | | (4) a sale or transfer of tangible personal
property as |
3 | | an incident to the
rendering of service for interstate |
4 | | carriers for hire for use as rolling stock
moving in |
5 | | interstate commerce or by lessors under a lease of one year |
6 | | or
longer, executed or in effect at the time of purchase of |
7 | | personal property, to
interstate carriers for hire for use |
8 | | as rolling stock moving in interstate
commerce so long as |
9 | | so used by such interstate carriers for hire, and equipment
|
10 | | operated by a telecommunications provider, licensed as a |
11 | | common carrier by the
Federal Communications Commission, |
12 | | which is permanently installed in or affixed
to aircraft |
13 | | moving in interstate commerce.
|
14 | | (4a) a sale or transfer of tangible personal
property |
15 | | as an incident
to the rendering of service for owners, |
16 | | lessors, or shippers of tangible
personal property which is |
17 | | utilized by interstate carriers for hire for
use as rolling |
18 | | stock moving in interstate commerce so long as so used by
|
19 | | interstate carriers for hire, and equipment operated by a
|
20 | | telecommunications provider, licensed as a common carrier |
21 | | by the Federal
Communications Commission, which is |
22 | | permanently installed in or affixed to
aircraft moving in |
23 | | interstate commerce.
|
24 | | (4a-5) on and after July 1, 2003 and through June 30, |
25 | | 2004, a sale or transfer of a motor vehicle
of
the
second |
26 | | division with a gross vehicle weight in excess of 8,000 |
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1 | | pounds as an
incident to the rendering of service if that |
2 | | motor
vehicle is subject
to the commercial distribution fee |
3 | | imposed under Section 3-815.1 of the
Illinois Vehicle
Code. |
4 | | Beginning on July 1, 2004 and through June 30, 2005, the |
5 | | use in this State of motor vehicles of the second division: |
6 | | (i) with a gross vehicle weight rating in excess of 8,000 |
7 | | pounds; (ii) that are subject to the commercial |
8 | | distribution fee imposed under Section 3-815.1 of the |
9 | | Illinois Vehicle Code; and (iii) that are primarily used |
10 | | for commercial purposes. Through June 30, 2005, this
|
11 | | exemption applies to repair and replacement parts added |
12 | | after the
initial
purchase of such a motor vehicle if that |
13 | | motor vehicle is used in a manner that
would
qualify for |
14 | | the rolling stock exemption otherwise provided for in this |
15 | | Act. For purposes of this paragraph, "used for commercial |
16 | | purposes" means the transportation of persons or property |
17 | | in furtherance of any commercial or industrial enterprise |
18 | | whether for-hire or not.
|
19 | | (5) a sale or transfer of machinery and equipment used |
20 | | primarily in the
process of the manufacturing or |
21 | | assembling, either in an existing, an expanded
or a new |
22 | | manufacturing facility, of tangible personal property for |
23 | | wholesale or
retail sale or lease, whether such sale or |
24 | | lease is made directly by the
manufacturer or by some other |
25 | | person, whether the materials used in the process
are owned |
26 | | by the manufacturer or some other person, or whether such |
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1 | | sale or
lease is made apart from or as an incident to the |
2 | | seller's engaging in a
service occupation and the |
3 | | applicable tax is a Service Use Tax or Service
Occupation |
4 | | Tax, rather than Use Tax or Retailers' Occupation Tax. The |
5 | | exemption provided by this paragraph (5) does not include |
6 | | machinery and equipment used in (i) the generation of |
7 | | electricity for wholesale or retail sale; (ii) the |
8 | | generation or treatment of natural or artificial gas for |
9 | | wholesale or retail sale that is delivered to customers |
10 | | through pipes, pipelines, or mains; or (iii) the treatment |
11 | | of water for wholesale or retail sale that is delivered to |
12 | | customers through pipes, pipelines, or mains. The |
13 | | provisions of this amendatory Act of the 98th General |
14 | | Assembly are declaratory of existing law as to the meaning |
15 | | and scope of this exemption.
|
16 | | (5a) the repairing, reconditioning or remodeling, for |
17 | | a
common carrier by rail, of tangible personal property |
18 | | which belongs to such
carrier for hire, and as to which |
19 | | such carrier receives the physical possession
of the |
20 | | repaired, reconditioned or remodeled item of tangible |
21 | | personal property
in Illinois, and which such carrier |
22 | | transports, or shares with another common
carrier in the |
23 | | transportation of such property, out of Illinois on a |
24 | | standard
uniform bill of lading showing the person who |
25 | | repaired, reconditioned or
remodeled the property to a |
26 | | destination outside Illinois, for use outside
Illinois.
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1 | | (5b) a sale or transfer of tangible personal property |
2 | | which is produced by
the seller thereof on special order in |
3 | | such a way as to have made the
applicable tax the Service |
4 | | Occupation Tax or the Service Use Tax, rather than
the |
5 | | Retailers' Occupation Tax or the Use Tax, for an interstate |
6 | | carrier by rail
which receives the physical possession of |
7 | | such property in Illinois, and which
transports such |
8 | | property, or shares with another common carrier in the
|
9 | | transportation of such property, out of Illinois on a |
10 | | standard uniform bill of
lading showing the seller of the |
11 | | property as the shipper or consignor of such
property to a |
12 | | destination outside Illinois, for use outside Illinois.
|
13 | | (6) until July 1, 2003, a sale or transfer of |
14 | | distillation machinery
and equipment, sold
as a unit or kit |
15 | | and assembled or installed by the retailer, which
machinery |
16 | | and equipment is certified by the user to be used only for |
17 | | the
production of ethyl alcohol that will be used for |
18 | | consumption as motor fuel
or as a component of motor fuel |
19 | | for the personal use of such user and not
subject to sale |
20 | | or resale.
|
21 | | (7) at the election of any serviceman not required to |
22 | | be
otherwise registered as a retailer under Section 2a of |
23 | | the Retailers'
Occupation Tax Act, made for each fiscal |
24 | | year sales
of service in which the aggregate annual cost |
25 | | price of tangible
personal property transferred as an |
26 | | incident to the sales of service is
less than 35%, or 75% |
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1 | | in the case of servicemen transferring prescription
drugs |
2 | | or servicemen engaged in graphic arts production, of the |
3 | | aggregate
annual total gross receipts from all sales of |
4 | | service. The purchase of
such tangible personal property by |
5 | | the serviceman shall be subject to tax
under the Retailers' |
6 | | Occupation Tax Act and the Use Tax Act.
However, if a
|
7 | | primary serviceman who has made the election described in |
8 | | this paragraph
subcontracts service work to a secondary |
9 | | serviceman who has also made the
election described in this |
10 | | paragraph, the primary serviceman does not
incur a Use Tax |
11 | | liability if the secondary serviceman (i) has paid or will |
12 | | pay
Use
Tax on his or her cost price of any tangible |
13 | | personal property transferred
to the primary serviceman |
14 | | and (ii) certifies that fact in writing to the
primary
|
15 | | serviceman.
|
16 | | Tangible personal property transferred incident to the |
17 | | completion of a
maintenance agreement is exempt from the tax |
18 | | imposed pursuant to this Act.
|
19 | | Exemption (5) also includes machinery and equipment used in |
20 | | the general
maintenance or repair of such exempt machinery and |
21 | | equipment or for in-house
manufacture of exempt machinery and |
22 | | equipment. The machinery and equipment exemption does not |
23 | | include machinery and equipment used in (i) the generation of |
24 | | electricity for wholesale or retail sale; (ii) the generation |
25 | | or treatment of natural or artificial gas for wholesale or |
26 | | retail sale that is delivered to customers through pipes, |
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1 | | pipelines, or mains; or (iii) the treatment of water for |
2 | | wholesale or retail sale that is delivered to customers through |
3 | | pipes, pipelines, or mains. The provisions of this amendatory |
4 | | Act of the 98th General Assembly are declaratory of existing |
5 | | law as to the meaning and scope of this exemption. For the |
6 | | purposes of exemption
(5), each of these terms shall have the |
7 | | following meanings: (1) "manufacturing
process" shall mean the |
8 | | production of any article of tangible personal
property, |
9 | | whether such article is a finished product or an article for |
10 | | use in
the process of manufacturing or assembling a different |
11 | | article of tangible
personal property, by procedures commonly |
12 | | regarded as manufacturing,
processing, fabricating, or |
13 | | refining which changes some existing
material or materials into |
14 | | a material with a different form, use or
name. In relation to a |
15 | | recognized integrated business composed of a
series of |
16 | | operations which collectively constitute manufacturing, or
|
17 | | individually constitute manufacturing operations, the |
18 | | manufacturing
process shall be deemed to commence with the |
19 | | first operation or stage of
production in the series, and shall |
20 | | not be deemed to end until the
completion of the final product |
21 | | in the last operation or stage of
production in the series; and |
22 | | further, for purposes of exemption (5),
photoprocessing is |
23 | | deemed to be a manufacturing process of tangible
personal |
24 | | property for wholesale or retail sale; (2) "assembling process" |
25 | | shall
mean the production of any article of tangible personal |
26 | | property, whether such
article is a finished product or an |
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1 | | article for use in the process of
manufacturing or assembling a |
2 | | different article of tangible personal
property, by the |
3 | | combination of existing materials in a manner commonly
regarded |
4 | | as assembling which results in a material of a different form,
|
5 | | use or name; (3) "machinery" shall mean major mechanical |
6 | | machines or
major components of such machines contributing to a |
7 | | manufacturing or
assembling process; and (4) "equipment" shall |
8 | | include any independent
device or tool separate from any |
9 | | machinery but essential to an
integrated manufacturing or |
10 | | assembly process; including computers
used primarily in a |
11 | | manufacturer's computer
assisted design, computer assisted |
12 | | manufacturing (CAD/CAM) system;
or any subunit or assembly |
13 | | comprising a component of any machinery or
auxiliary, adjunct |
14 | | or attachment parts of machinery, such as tools, dies,
jigs, |
15 | | fixtures, patterns and molds; or any parts which require |
16 | | periodic
replacement in the course of normal operation; but |
17 | | shall not include hand
tools.
Equipment includes chemicals or |
18 | | chemicals acting as catalysts but only if the
chemicals or |
19 | | chemicals acting as catalysts effect a direct and immediate |
20 | | change
upon a
product being manufactured or assembled for |
21 | | wholesale or retail sale or
lease.
The purchaser of such |
22 | | machinery and equipment who has an active
resale registration |
23 | | number shall furnish such number to the seller at the
time of |
24 | | purchase. The user of such machinery and equipment and tools
|
25 | | without an active resale registration number shall prepare a |
26 | | certificate of
exemption for each transaction stating facts |
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1 | | establishing the exemption for
that transaction, which |
2 | | certificate shall be available to the Department
for inspection |
3 | | or audit. The Department shall prescribe the form of the
|
4 | | certificate.
|
5 | | Any informal rulings, opinions or letters issued by the |
6 | | Department in
response to an inquiry or request for any opinion |
7 | | from any person
regarding the coverage and applicability of |
8 | | exemption (5) to specific
devices shall be published, |
9 | | maintained as a public record, and made
available for public |
10 | | inspection and copying. If the informal ruling,
opinion or |
11 | | letter contains trade secrets or other confidential
|
12 | | information, where possible the Department shall delete such |
13 | | information
prior to publication. Whenever such informal |
14 | | rulings, opinions, or
letters contain any policy of general |
15 | | applicability, the Department
shall formulate and adopt such |
16 | | policy as a rule in accordance with the
provisions of the |
17 | | Illinois Administrative Procedure Act.
|
18 | | On and after July 1, 1987, no entity otherwise eligible |
19 | | under exemption
(3) of this Section shall make tax free |
20 | | purchases unless it has an active
exemption identification |
21 | | number issued by the Department.
|
22 | | The purchase, employment and transfer of such tangible |
23 | | personal
property as newsprint and ink for the primary purpose |
24 | | of conveying news
(with or without other information) is not a |
25 | | purchase, use or sale of
service or of tangible personal |
26 | | property within the meaning of this Act.
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1 | | "Serviceman" means any person who is engaged in the |
2 | | occupation of
making sales of service.
|
3 | | "Sale at retail" means "sale at retail" as defined in the |
4 | | Retailers'
Occupation Tax Act.
|
5 | | "Supplier" means any person who makes sales of tangible |
6 | | personal
property to servicemen for the purpose of resale as an |
7 | | incident to a
sale of service.
|
8 | | "Serviceman maintaining a place of business in this State", |
9 | | or any
like term, means and includes any serviceman:
|
10 | | 1. having or maintaining within this State, directly or |
11 | | by a
subsidiary, an office, distribution house, sales |
12 | | house, warehouse or
other place of business, or any agent |
13 | | or other representative operating
within this State under |
14 | | the authority of the serviceman or its
subsidiary, |
15 | | irrespective of whether such place of business or agent or
|
16 | | other representative is located here permanently or |
17 | | temporarily, or
whether such serviceman or subsidiary is |
18 | | licensed to do business in this
State; |
19 | | 1.1. having a contract with a person located in this |
20 | | State under which the person, for a commission or other |
21 | | consideration based on the sale of service by the |
22 | | serviceman, directly or indirectly refers potential |
23 | | customers to the serviceman by providing to the potential |
24 | | customers a promotional code or other mechanism that allows |
25 | | the serviceman to track purchases referred by such persons. |
26 | | Examples of mechanisms that allow the serviceman to track |
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1 | | purchases referred by such persons include but are not |
2 | | limited to the use of a link on the person's Internet |
3 | | website, promotional codes distributed through the |
4 | | person's hand-delivered or mailed material, and |
5 | | promotional codes distributed by the person through radio |
6 | | or other broadcast media. The provisions of this paragraph |
7 | | 1.1 shall apply only if the cumulative gross receipts from |
8 | | sales of service by the serviceman to customers who are |
9 | | referred to the serviceman by all persons in this State |
10 | | under such contracts exceed $10,000 during the preceding 4 |
11 | | quarterly periods ending on the last day of March, June, |
12 | | September, and December; a serviceman meeting the |
13 | | requirements of this paragraph 1.1 shall be presumed to be |
14 | | maintaining a place of business in this State but may rebut |
15 | | this presumption by submitting proof that the referrals or |
16 | | other activities pursued within this State by such persons |
17 | | were not sufficient to meet the nexus standards of the |
18 | | United States Constitution during the preceding 4 |
19 | | quarterly periods; |
20 | | 1.2. beginning July 1, 2011, having a contract with a |
21 | | person located in this State under which: |
22 | | A. the serviceman sells the same or substantially |
23 | | similar line of services as the person located in this |
24 | | State and does so using an identical or substantially |
25 | | similar name, trade name, or trademark as the person |
26 | | located in this State; and |
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1 | | B. the serviceman provides a commission or other |
2 | | consideration to the person located in this State based |
3 | | upon the sale of services by the serviceman. |
4 | | The provisions of this paragraph 1.2 shall apply only if |
5 | | the cumulative gross receipts from sales of service by the |
6 | | serviceman to customers in this State under all such |
7 | | contracts exceed $10,000 during the preceding 4 quarterly |
8 | | periods ending on the last day of March, June, September, |
9 | | and December;
|
10 | | 2. soliciting orders for tangible personal property by |
11 | | means of a
telecommunication or television shopping system |
12 | | (which utilizes toll free
numbers) which is intended by the |
13 | | retailer to be broadcast by cable
television or other means |
14 | | of broadcasting, to consumers located in this State;
|
15 | | 3. pursuant to a contract with a broadcaster or |
16 | | publisher located in this
State, soliciting orders for |
17 | | tangible personal property by means of advertising
which is |
18 | | disseminated primarily to consumers located in this State |
19 | | and only
secondarily to bordering jurisdictions;
|
20 | | 4. soliciting orders for tangible personal property by |
21 | | mail if the
solicitations are substantial and recurring and |
22 | | if the retailer benefits
from any banking, financing, debt |
23 | | collection, telecommunication, or
marketing activities |
24 | | occurring in this State or benefits from the location
in |
25 | | this State of authorized installation, servicing, or |
26 | | repair facilities;
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1 | | 5. being owned or controlled by the same interests |
2 | | which own or
control any retailer engaging in business in |
3 | | the same or similar line of
business in this State;
|
4 | | 6. having a franchisee or licensee operating under its |
5 | | trade name if
the franchisee or licensee is required to |
6 | | collect the tax under this Section;
|
7 | | 7. pursuant to a contract with a cable television |
8 | | operator located in
this State, soliciting orders for |
9 | | tangible personal property by means of
advertising which is |
10 | | transmitted or distributed over a cable television
system |
11 | | in this State; or
|
12 | | 8. engaging in activities in Illinois, which |
13 | | activities in the
state in which the supply business |
14 | | engaging in such activities is located
would constitute |
15 | | maintaining a place of business in that state.
|
16 | | (Source: P.A. 98-583, eff. 1-1-14; 98-1089, eff. 1-1-15.)
|
17 | | Section 15. The Retailers' Occupation Tax Act is amended by |
18 | | changing Section 1 as follows:
|
19 | | (35 ILCS 120/1) (from Ch. 120, par. 440)
|
20 | | Sec. 1. Definitions. "Sale at retail" means any transfer of |
21 | | the
ownership of or title to
tangible personal property to a |
22 | | purchaser, for the purpose of use or
consumption, and not for |
23 | | the purpose of resale in any form as tangible
personal property |
24 | | to the extent not first subjected to a use for which it
was |
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1 | | purchased, for a valuable consideration: Provided that the |
2 | | property
purchased is deemed to be purchased for the purpose of |
3 | | resale, despite
first being used, to the extent to which it is |
4 | | resold as an ingredient of
an intentionally produced product or |
5 | | byproduct of manufacturing. For this
purpose, slag produced as |
6 | | an incident to manufacturing pig iron or steel
and sold is |
7 | | considered to be an intentionally produced byproduct of
|
8 | | manufacturing. Transactions whereby the possession of the |
9 | | property is
transferred but the seller retains the title as |
10 | | security for payment of the
selling price shall be deemed to be |
11 | | sales.
|
12 | | "Sale at retail" shall be construed to include any transfer |
13 | | of the
ownership of or title to tangible personal property to a |
14 | | purchaser, for use
or consumption by any other person to whom |
15 | | such purchaser may transfer the
tangible personal property |
16 | | without a valuable consideration, and to include
any transfer, |
17 | | whether made for or without a valuable consideration, for
|
18 | | resale in any form as tangible personal property unless made in |
19 | | compliance
with Section 2c of this Act.
|
20 | | Sales of tangible personal property, which property, to the |
21 | | extent not
first subjected to a use for which it was purchased, |
22 | | as an ingredient or
constituent, goes into and forms a part of |
23 | | tangible personal property
subsequently the subject of a "Sale |
24 | | at retail", are not sales at retail as
defined in this Act: |
25 | | Provided that the property purchased is deemed to be
purchased |
26 | | for the purpose of resale, despite first being used, to the
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1 | | extent to which it is resold as an ingredient of an |
2 | | intentionally produced
product or byproduct of manufacturing.
|
3 | | "Sale at retail" shall be construed to include any Illinois |
4 | | florist's
sales transaction in which the purchase order is |
5 | | received in Illinois by a
florist and the sale is for use or |
6 | | consumption, but the Illinois florist
has a florist in another |
7 | | state deliver the property to the purchaser or the
purchaser's |
8 | | donee in such other state.
|
9 | | Nonreusable tangible personal property that is used by |
10 | | persons engaged in
the business of operating a restaurant, |
11 | | cafeteria, or drive-in is a sale for
resale when it is |
12 | | transferred to customers in the ordinary course of business
as |
13 | | part of the sale of food or beverages and is used to deliver, |
14 | | package, or
consume food or beverages, regardless of where |
15 | | consumption of the food or
beverages occurs. Examples of those |
16 | | items include, but are not limited to
nonreusable, paper and |
17 | | plastic cups, plates, baskets, boxes, sleeves, buckets
or other |
18 | | containers, utensils, straws, placemats, napkins, doggie bags, |
19 | | and
wrapping or packaging
materials that are transferred to |
20 | | customers as part of the sale of food or
beverages in the |
21 | | ordinary course of business.
|
22 | | The purchase, employment and transfer of such tangible |
23 | | personal property
as newsprint and ink for the primary purpose |
24 | | of conveying news (with or
without other information) is not a |
25 | | purchase, use or sale of tangible
personal property.
|
26 | | A person whose activities are organized and conducted |
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1 | | primarily as a
not-for-profit service enterprise, and who |
2 | | engages in selling tangible
personal property at retail |
3 | | (whether to the public or merely to members and
their guests) |
4 | | is engaged in the business of selling tangible personal
|
5 | | property at retail with respect to such transactions, excepting |
6 | | only a
person organized and operated exclusively for |
7 | | charitable, religious or
educational purposes either (1), to |
8 | | the extent of sales by such person to
its members, students, |
9 | | patients or inmates of tangible personal property to
be used |
10 | | primarily for the purposes of such person, or (2), to the |
11 | | extent of
sales by such person of tangible personal property |
12 | | which is not sold or
offered for sale by persons organized for |
13 | | profit. The selling of school
books and school supplies by |
14 | | schools at retail to students is not
"primarily for the |
15 | | purposes of" the school which does such selling. The
provisions |
16 | | of this paragraph shall not apply to nor subject to taxation
|
17 | | occasional dinners, socials or similar activities of a person |
18 | | organized and
operated exclusively for charitable, religious |
19 | | or educational purposes,
whether or not such activities are |
20 | | open to the public.
|
21 | | A person who is the recipient of a grant or contract under |
22 | | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and |
23 | | serves meals to
participants in the federal Nutrition Program |
24 | | for the Elderly in return for
contributions established in |
25 | | amount by the individual participant pursuant
to a schedule of |
26 | | suggested fees as provided for in the federal Act is not
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1 | | engaged in the business of selling tangible personal property |
2 | | at retail
with respect to such transactions.
|
3 | | "Purchaser" means anyone who, through a sale at retail, |
4 | | acquires the
ownership of or title to tangible personal |
5 | | property for a valuable
consideration.
|
6 | | "Reseller of motor fuel" means any person engaged in the |
7 | | business of selling
or delivering or transferring title of |
8 | | motor fuel to another person
other than for use or consumption.
|
9 | | No person shall act as a reseller of motor fuel within this |
10 | | State without
first being registered as a reseller pursuant to |
11 | | Section 2c or a retailer
pursuant to Section 2a.
|
12 | | "Selling price" or the "amount of sale" means the |
13 | | consideration for a
sale valued in money whether received in |
14 | | money or otherwise, including
cash, credits, property, other |
15 | | than as hereinafter provided, and services,
but not including |
16 | | the value of or credit given for traded-in tangible
personal |
17 | | property where the item that is traded-in is of like kind and
|
18 | | character as that which is being sold, and shall be determined |
19 | | without any
deduction on account of the cost of the property |
20 | | sold, the cost of
materials used, labor or service cost or any |
21 | | other expense whatsoever, but
does not include charges that are |
22 | | added to prices by sellers on account of
the seller's tax |
23 | | liability under this Act, or on account of the seller's
duty to |
24 | | collect, from the purchaser, the tax that is imposed by the Use |
25 | | Tax
Act, or, except as otherwise provided with respect to any |
26 | | cigarette tax imposed by a home rule unit, on account of the |
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1 | | seller's tax liability under any local occupation tax |
2 | | administered by the Department, or, except as otherwise |
3 | | provided with respect to any cigarette tax imposed by a home |
4 | | rule unit on account of the seller's duty to collect, from the |
5 | | purchasers, the tax that is imposed under any local use tax |
6 | | administered by the Department.
Effective December 1, 1985, |
7 | | "selling price" shall include charges that
are added to prices |
8 | | by sellers on account of the seller's
tax liability under the |
9 | | Cigarette Tax Act, on account of the sellers'
duty to collect, |
10 | | from the purchaser, the tax imposed under the Cigarette
Use Tax |
11 | | Act, and on account of the seller's duty to collect, from the
|
12 | | purchaser, any cigarette tax imposed by a home rule unit.
|
13 | | Notwithstanding any other provision of law, "selling |
14 | | price" does not include any fee charged by the retailer for the |
15 | | disposal of tires if that fee is a separately stated charge on |
16 | | the customer's invoice. |
17 | | Notwithstanding any law to the contrary, for any motor |
18 | | vehicle, as defined in Section 1-146 of the Vehicle Code, that |
19 | | is sold on or after January 1, 2015 for the purpose of leasing |
20 | | the vehicle for a defined period that is longer than one year |
21 | | and (1) is a motor vehicle of the second division that: (A) is |
22 | | a self-contained motor vehicle designed or permanently |
23 | | converted to provide living quarters for recreational, |
24 | | camping, or travel use, with direct walk through access to the |
25 | | living quarters from the driver's seat; (B) is of the van |
26 | | configuration designed for the transportation of not less than |
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1 | | 7 nor more than 16 passengers; or (C) has a gross vehicle |
2 | | weight rating of 8,000 pounds or less or (2) is a motor vehicle |
3 | | of the first division, "selling price" or "amount of sale" |
4 | | means the consideration received by the lessor pursuant to the |
5 | | lease contract, including amounts due at lease signing and all |
6 | | monthly or other regular payments charged over the term of the |
7 | | lease. Also included in the selling price is any amount |
8 | | received by the lessor from the lessee for the leased vehicle |
9 | | that is not calculated at the time the lease is executed, |
10 | | including, but not limited to, excess mileage charges and |
11 | | charges for excess wear and tear. For sales that occur in |
12 | | Illinois, with respect to any amount received by the lessor |
13 | | from the lessee for the leased vehicle that is not calculated |
14 | | at the time the lease is executed, the lessor who purchased the |
15 | | motor vehicle does not incur the tax imposed by the Use Tax Act |
16 | | on those amounts, and the retailer who makes the retail sale of |
17 | | the motor vehicle to the lessor is not required to collect the |
18 | | tax imposed by the Use Tax Act or to pay the tax imposed by this |
19 | | Act on those amounts. However, the lessor who purchased the |
20 | | motor vehicle assumes the liability for reporting and paying |
21 | | the tax on those amounts directly to the Department in the same |
22 | | form (Illinois Retailers' Occupation Tax, and local retailers' |
23 | | occupation taxes, if applicable) in which the retailer would |
24 | | have reported and paid such tax if the retailer had accounted |
25 | | for the tax to the Department. For amounts received by the |
26 | | lessor from the lessee that are not calculated at the time the |
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1 | | lease is executed, the lessor must file the return and pay the |
2 | | tax to the Department by the due date otherwise required by |
3 | | this Act for returns other than transaction returns. If the |
4 | | retailer is entitled under this Act to a discount for |
5 | | collecting and remitting the tax imposed under this Act to the |
6 | | Department with respect to the sale of the motor vehicle to the |
7 | | lessor, then the right to the discount provided in this Act |
8 | | shall be transferred to the lessor with respect to the tax paid |
9 | | by the lessor for any amount received by the lessor from the |
10 | | lessee for the leased vehicle that is not calculated at the |
11 | | time the lease is executed; provided that the discount is only |
12 | | allowed if the return is timely filed and for amounts timely |
13 | | paid. The "selling price" of a motor vehicle that is sold on or |
14 | | after January 1, 2015 for the purpose of leasing for a defined |
15 | | period of longer than one year shall not be reduced by the |
16 | | value of or credit given for traded-in tangible personal |
17 | | property owned by the lessor, nor shall it be reduced by the |
18 | | value of or credit given for traded-in tangible personal |
19 | | property owned by the lessee, regardless of whether the |
20 | | trade-in value thereof is assigned by the lessee to the lessor. |
21 | | In the case of a motor vehicle that is sold for the purpose of |
22 | | leasing for a defined period of longer than one year, the sale |
23 | | occurs at the time of the delivery of the vehicle, regardless |
24 | | of the due date of any lease payments. A lessor who incurs a |
25 | | Retailers' Occupation Tax liability on the sale of a motor |
26 | | vehicle coming off lease may not take a credit against that |
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1 | | liability for the Use Tax the lessor paid upon the purchase of |
2 | | the motor vehicle (or for any tax the lessor paid with respect |
3 | | to any amount received by the lessor from the lessee for the |
4 | | leased vehicle that was not calculated at the time the lease |
5 | | was executed) if the selling price of the motor vehicle at the |
6 | | time of purchase was calculated using the definition of |
7 | | "selling price" as defined in this paragraph.
Notwithstanding |
8 | | any other provision of this Act to the contrary, lessors shall |
9 | | file all returns and make all payments required under this |
10 | | paragraph to the Department by electronic means in the manner |
11 | | and form as required by the Department. This paragraph does not |
12 | | apply to leases of motor vehicles for which, at the time the |
13 | | lease is entered into, the term of the lease is not a defined |
14 | | period, including leases with a defined initial period with the |
15 | | option to continue the lease on a month-to-month or other basis |
16 | | beyond the initial defined period. |
17 | | The phrase "like kind and character" shall be liberally |
18 | | construed
(including but not limited to any form of motor |
19 | | vehicle for any form of
motor vehicle, or any kind of farm or |
20 | | agricultural implement for any other
kind of farm or |
21 | | agricultural implement), while not including a kind of item
|
22 | | which, if sold at retail by that retailer, would be exempt from |
23 | | retailers'
occupation tax and use tax as an isolated or |
24 | | occasional sale.
|
25 | | "Gross receipts" from the sales of tangible personal |
26 | | property at retail
means the total selling price or the amount |
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1 | | of such sales, as hereinbefore
defined. In the case of charge |
2 | | and time sales, the amount thereof shall be
included only as |
3 | | and when payments are received by the seller.
Receipts or other |
4 | | consideration derived by a seller from
the sale, transfer or |
5 | | assignment of accounts receivable to a wholly owned
subsidiary |
6 | | will not be deemed payments prior to the time the purchaser
|
7 | | makes payment on such accounts.
|
8 | | "Department" means the Department of Revenue.
|
9 | | "Person" means any natural individual, firm, partnership, |
10 | | association,
joint stock company, joint adventure, public or |
11 | | private corporation, limited
liability company, or a receiver, |
12 | | executor, trustee, guardian or other
representative appointed |
13 | | by order of any court.
|
14 | | The isolated or occasional sale of tangible personal |
15 | | property at retail
by a person who does not hold himself out as |
16 | | being engaged (or who does not
habitually engage) in selling |
17 | | such tangible personal property at retail, or
a sale through a |
18 | | bulk vending machine, does not constitute engaging in a
|
19 | | business of selling such tangible personal property at retail |
20 | | within the
meaning of this Act; provided that any person who is |
21 | | engaged in a business
which is not subject to the tax imposed |
22 | | by this Act because of involving
the sale of or a contract to |
23 | | sell real estate or a construction contract to
improve real |
24 | | estate or a construction contract to engineer, install, and
|
25 | | maintain an integrated system of products, but who, in the |
26 | | course of
conducting such business,
transfers tangible |
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1 | | personal property to users or consumers in the finished
form in |
2 | | which it was purchased, and which does not become real estate |
3 | | or was
not engineered and installed, under any provision of a |
4 | | construction contract or
real estate sale or real estate sales |
5 | | agreement entered into with some other
person arising out of or |
6 | | because of such nontaxable business, is engaged in the
business |
7 | | of selling tangible personal property at retail to the extent |
8 | | of the
value of the tangible personal property so transferred. |
9 | | If, in such a
transaction, a separate charge is made for the |
10 | | tangible personal property so
transferred, the value of such |
11 | | property, for the purpose of this Act, shall be
the amount so |
12 | | separately charged, but not less than the cost of such property
|
13 | | to the transferor; if no separate charge is made, the value of |
14 | | such property,
for the purposes of this Act, is the cost to the |
15 | | transferor of such tangible
personal property. Construction |
16 | | contracts for the improvement of real estate
consisting of |
17 | | engineering, installation, and maintenance of voice, data, |
18 | | video,
security, and all telecommunication systems do not |
19 | | constitute engaging in a
business of selling tangible personal |
20 | | property at retail within the meaning of
this Act if they are |
21 | | sold at one specified contract price.
|
22 | | A person who holds himself or herself out as being engaged |
23 | | (or who habitually
engages) in selling tangible personal |
24 | | property at retail is a person
engaged in the business of |
25 | | selling tangible personal property at retail
hereunder with |
26 | | respect to such sales (and not primarily in a service
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1 | | occupation) notwithstanding the fact that such person designs |
2 | | and produces
such tangible personal property on special order |
3 | | for the purchaser and in
such a way as to render the property |
4 | | of value only to such purchaser, if
such tangible personal |
5 | | property so produced on special order serves
substantially the |
6 | | same function as stock or standard items of tangible
personal |
7 | | property that are sold at retail.
|
8 | | Persons who engage in the business of transferring tangible |
9 | | personal
property upon the redemption of trading stamps are |
10 | | engaged in the business
of selling such property at retail and |
11 | | shall be liable for and shall pay
the tax imposed by this Act |
12 | | on the basis of the retail value of the
property transferred |
13 | | upon redemption of such stamps.
|
14 | | "Bulk vending machine" means a vending machine,
containing |
15 | | unsorted confections, nuts, toys, or other items designed
|
16 | | primarily to be used or played with by children
which, when a |
17 | | coin or coins of a denomination not larger than $0.50 are
|
18 | | inserted, are dispensed in equal portions, at random and
|
19 | | without selection by the customer.
|
20 | | (Source: P.A. 98-628, eff. 1-1-15; 98-1080, eff. 8-26-14.)
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