Full Text of SB2668 100th General Assembly
SB2668eng 100TH GENERAL ASSEMBLY |
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| 1 | | AN ACT concerning revenue.
| 2 | | Be it enacted by the People of the State of Illinois, | 3 | | represented in the General Assembly:
| 4 | | Section 5. The Retailers' Occupation Tax Act is amended by | 5 | | changing Section 1 as follows:
| 6 | | (35 ILCS 120/1) (from Ch. 120, par. 440)
| 7 | | Sec. 1. Definitions. "Sale at retail" means any transfer of | 8 | | the
ownership of or title to
tangible personal property to a | 9 | | purchaser, for the purpose of use or
consumption, and not for | 10 | | the purpose of resale in any form as tangible
personal property | 11 | | to the extent not first subjected to a use for which it
was | 12 | | purchased, for a valuable consideration: Provided that the | 13 | | property
purchased is deemed to be purchased for the purpose of | 14 | | resale, despite
first being used, to the extent to which it is | 15 | | resold as an ingredient of
an intentionally produced product or | 16 | | byproduct of manufacturing. For this
purpose, slag produced as | 17 | | an incident to manufacturing pig iron or steel
and sold is | 18 | | considered to be an intentionally produced byproduct of
| 19 | | manufacturing. Transactions whereby the possession of the | 20 | | property is
transferred but the seller retains the title as | 21 | | security for payment of the
selling price shall be deemed to be | 22 | | sales.
| 23 | | "Sale at retail" shall be construed to include any transfer |
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| 1 | | of the
ownership of or title to tangible personal property to a | 2 | | purchaser, for use
or consumption by any other person to whom | 3 | | such purchaser may transfer the
tangible personal property | 4 | | without a valuable consideration, and to include
any transfer, | 5 | | whether made for or without a valuable consideration, for
| 6 | | resale in any form as tangible personal property unless made in | 7 | | compliance
with Section 2c of this Act.
| 8 | | Sales of tangible personal property, which property, to the | 9 | | extent not
first subjected to a use for which it was purchased, | 10 | | as an ingredient or
constituent, goes into and forms a part of | 11 | | tangible personal property
subsequently the subject of a "Sale | 12 | | at retail", are not sales at retail as
defined in this Act: | 13 | | Provided that the property purchased is deemed to be
purchased | 14 | | for the purpose of resale, despite first being used, to the
| 15 | | extent to which it is resold as an ingredient of an | 16 | | intentionally produced
product or byproduct of manufacturing.
| 17 | | "Sale at retail" shall be construed to include any Illinois | 18 | | florist's
sales transaction in which the purchase order is | 19 | | received in Illinois by a
florist and the sale is for use or | 20 | | consumption, but the Illinois florist
has a florist in another | 21 | | state deliver the property to the purchaser or the
purchaser's | 22 | | donee in such other state.
| 23 | | Nonreusable tangible personal property that is used by | 24 | | persons engaged in
the business of operating a restaurant, | 25 | | cafeteria, or drive-in is a sale for
resale when it is | 26 | | transferred to customers in the ordinary course of business
as |
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| 1 | | part of the sale of food or beverages and is used to deliver, | 2 | | package, or
consume food or beverages, regardless of where | 3 | | consumption of the food or
beverages occurs. Examples of those | 4 | | items include, but are not limited to
nonreusable, paper and | 5 | | plastic cups, plates, baskets, boxes, sleeves, buckets
or other | 6 | | containers, utensils, straws, placemats, napkins, doggie bags, | 7 | | and
wrapping or packaging
materials that are transferred to | 8 | | customers as part of the sale of food or
beverages in the | 9 | | ordinary course of business. | 10 | | "Sale at retail" does not include the selling of food at | 11 | | retail to students, teachers, or staff at a school serving some | 12 | | or all of grades kindergarten through 12.
| 13 | | The purchase, employment and transfer of such tangible | 14 | | personal property
as newsprint and ink for the primary purpose | 15 | | of conveying news (with or
without other information) is not a | 16 | | purchase, use or sale of tangible
personal property.
| 17 | | A person whose activities are organized and conducted | 18 | | primarily as a
not-for-profit service enterprise, and who | 19 | | engages in selling tangible
personal property at retail | 20 | | (whether to the public or merely to members and
their guests) | 21 | | is engaged in the business of selling tangible personal
| 22 | | property at retail with respect to such transactions, excepting | 23 | | only a
person organized and operated exclusively for | 24 | | charitable, religious or
educational purposes either (1), to | 25 | | the extent of sales by such person to
its members, students, | 26 | | patients or inmates of tangible personal property to
be used |
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| 1 | | primarily for the purposes of such person, or (2), to the | 2 | | extent of
sales by such person of tangible personal property | 3 | | which is not sold or
offered for sale by persons organized for | 4 | | profit. The selling of school
books and school supplies by | 5 | | schools at retail to students is not
"primarily for the | 6 | | purposes of" the school which does such selling. The
provisions | 7 | | of this paragraph shall not apply to nor subject to taxation
| 8 | | occasional dinners, socials or similar activities of a person | 9 | | organized and
operated exclusively for charitable, religious | 10 | | or educational purposes,
whether or not such activities are | 11 | | open to the public.
| 12 | | A person who is the recipient of a grant or contract under | 13 | | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | 14 | | serves meals to
participants in the federal Nutrition Program | 15 | | for the Elderly in return for
contributions established in | 16 | | amount by the individual participant pursuant
to a schedule of | 17 | | suggested fees as provided for in the federal Act is not
| 18 | | engaged in the business of selling tangible personal property | 19 | | at retail
with respect to such transactions.
| 20 | | "Purchaser" means anyone who, through a sale at retail, | 21 | | acquires the
ownership of or title to tangible personal | 22 | | property for a valuable
consideration.
| 23 | | "Reseller of motor fuel" means any person engaged in the | 24 | | business of selling
or delivering or transferring title of | 25 | | motor fuel to another person
other than for use or consumption.
| 26 | | No person shall act as a reseller of motor fuel within this |
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| 1 | | State without
first being registered as a reseller pursuant to | 2 | | Section 2c or a retailer
pursuant to Section 2a.
| 3 | | "Selling price" or the "amount of sale" means the | 4 | | consideration for a
sale valued in money whether received in | 5 | | money or otherwise, including
cash, credits, property, other | 6 | | than as hereinafter provided, and services,
but not including | 7 | | the value of or credit given for traded-in tangible
personal | 8 | | property where the item that is traded-in is of like kind and
| 9 | | character as that which is being sold, and shall be determined | 10 | | without any
deduction on account of the cost of the property | 11 | | sold, the cost of
materials used, labor or service cost or any | 12 | | other expense whatsoever, but
does not include charges that are | 13 | | added to prices by sellers on account of
the seller's tax | 14 | | liability under this Act, or on account of the seller's
duty to | 15 | | collect, from the purchaser, the tax that is imposed by the Use | 16 | | Tax
Act, or, except as otherwise provided with respect to any | 17 | | cigarette tax imposed by a home rule unit, on account of the | 18 | | seller's tax liability under any local occupation tax | 19 | | administered by the Department, or, except as otherwise | 20 | | provided with respect to any cigarette tax imposed by a home | 21 | | rule unit on account of the seller's duty to collect, from the | 22 | | purchasers, the tax that is imposed under any local use tax | 23 | | administered by the Department.
Effective December 1, 1985, | 24 | | "selling price" shall include charges that
are added to prices | 25 | | by sellers on account of the seller's
tax liability under the | 26 | | Cigarette Tax Act, on account of the sellers'
duty to collect, |
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| 1 | | from the purchaser, the tax imposed under the Cigarette
Use Tax | 2 | | Act, and on account of the seller's duty to collect, from the
| 3 | | purchaser, any cigarette tax imposed by a home rule unit.
| 4 | | Notwithstanding any law to the contrary, for any motor | 5 | | vehicle, as defined in Section 1-146 of the Vehicle Code, that | 6 | | is sold on or after January 1, 2015 for the purpose of leasing | 7 | | the vehicle for a defined period that is longer than one year | 8 | | and (1) is a motor vehicle of the second division that: (A) is | 9 | | a self-contained motor vehicle designed or permanently | 10 | | converted to provide living quarters for recreational, | 11 | | camping, or travel use, with direct walk through access to the | 12 | | living quarters from the driver's seat; (B) is of the van | 13 | | configuration designed for the transportation of not less than | 14 | | 7 nor more than 16 passengers; or (C) has a gross vehicle | 15 | | weight rating of 8,000 pounds or less or (2) is a motor vehicle | 16 | | of the first division, "selling price" or "amount of sale" | 17 | | means the consideration received by the lessor pursuant to the | 18 | | lease contract, including amounts due at lease signing and all | 19 | | monthly or other regular payments charged over the term of the | 20 | | lease. Also included in the selling price is any amount | 21 | | received by the lessor from the lessee for the leased vehicle | 22 | | that is not calculated at the time the lease is executed, | 23 | | including, but not limited to, excess mileage charges and | 24 | | charges for excess wear and tear. For sales that occur in | 25 | | Illinois, with respect to any amount received by the lessor | 26 | | from the lessee for the leased vehicle that is not calculated |
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| 1 | | at the time the lease is executed, the lessor who purchased the | 2 | | motor vehicle does not incur the tax imposed by the Use Tax Act | 3 | | on those amounts, and the retailer who makes the retail sale of | 4 | | the motor vehicle to the lessor is not required to collect the | 5 | | tax imposed by the Use Tax Act or to pay the tax imposed by this | 6 | | Act on those amounts. However, the lessor who purchased the | 7 | | motor vehicle assumes the liability for reporting and paying | 8 | | the tax on those amounts directly to the Department in the same | 9 | | form (Illinois Retailers' Occupation Tax, and local retailers' | 10 | | occupation taxes, if applicable) in which the retailer would | 11 | | have reported and paid such tax if the retailer had accounted | 12 | | for the tax to the Department. For amounts received by the | 13 | | lessor from the lessee that are not calculated at the time the | 14 | | lease is executed, the lessor must file the return and pay the | 15 | | tax to the Department by the due date otherwise required by | 16 | | this Act for returns other than transaction returns. If the | 17 | | retailer is entitled under this Act to a discount for | 18 | | collecting and remitting the tax imposed under this Act to the | 19 | | Department with respect to the sale of the motor vehicle to the | 20 | | lessor, then the right to the discount provided in this Act | 21 | | shall be transferred to the lessor with respect to the tax paid | 22 | | by the lessor for any amount received by the lessor from the | 23 | | lessee for the leased vehicle that is not calculated at the | 24 | | time the lease is executed; provided that the discount is only | 25 | | allowed if the return is timely filed and for amounts timely | 26 | | paid. The "selling price" of a motor vehicle that is sold on or |
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| 1 | | after January 1, 2015 for the purpose of leasing for a defined | 2 | | period of longer than one year shall not be reduced by the | 3 | | value of or credit given for traded-in tangible personal | 4 | | property owned by the lessor, nor shall it be reduced by the | 5 | | value of or credit given for traded-in tangible personal | 6 | | property owned by the lessee, regardless of whether the | 7 | | trade-in value thereof is assigned by the lessee to the lessor. | 8 | | In the case of a motor vehicle that is sold for the purpose of | 9 | | leasing for a defined period of longer than one year, the sale | 10 | | occurs at the time of the delivery of the vehicle, regardless | 11 | | of the due date of any lease payments. A lessor who incurs a | 12 | | Retailers' Occupation Tax liability on the sale of a motor | 13 | | vehicle coming off lease may not take a credit against that | 14 | | liability for the Use Tax the lessor paid upon the purchase of | 15 | | the motor vehicle (or for any tax the lessor paid with respect | 16 | | to any amount received by the lessor from the lessee for the | 17 | | leased vehicle that was not calculated at the time the lease | 18 | | was executed) if the selling price of the motor vehicle at the | 19 | | time of purchase was calculated using the definition of | 20 | | "selling price" as defined in this paragraph.
Notwithstanding | 21 | | any other provision of this Act to the contrary, lessors shall | 22 | | file all returns and make all payments required under this | 23 | | paragraph to the Department by electronic means in the manner | 24 | | and form as required by the Department. This paragraph does not | 25 | | apply to leases of motor vehicles for which, at the time the | 26 | | lease is entered into, the term of the lease is not a defined |
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| 1 | | period, including leases with a defined initial period with the | 2 | | option to continue the lease on a month-to-month or other basis | 3 | | beyond the initial defined period. | 4 | | The phrase "like kind and character" shall be liberally | 5 | | construed
(including but not limited to any form of motor | 6 | | vehicle for any form of
motor vehicle, or any kind of farm or | 7 | | agricultural implement for any other
kind of farm or | 8 | | agricultural implement), while not including a kind of item
| 9 | | which, if sold at retail by that retailer, would be exempt from | 10 | | retailers'
occupation tax and use tax as an isolated or | 11 | | occasional sale.
| 12 | | "Gross receipts" from the sales of tangible personal | 13 | | property at retail
means the total selling price or the amount | 14 | | of such sales, as hereinbefore
defined. In the case of charge | 15 | | and time sales, the amount thereof shall be
included only as | 16 | | and when payments are received by the seller.
Receipts or other | 17 | | consideration derived by a seller from
the sale, transfer or | 18 | | assignment of accounts receivable to a wholly owned
subsidiary | 19 | | will not be deemed payments prior to the time the purchaser
| 20 | | makes payment on such accounts.
| 21 | | "Department" means the Department of Revenue.
| 22 | | "Person" means any natural individual, firm, partnership, | 23 | | association,
joint stock company, joint adventure, public or | 24 | | private corporation, limited
liability company, or a receiver, | 25 | | executor, trustee, guardian or other
representative appointed | 26 | | by order of any court.
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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 constitute engaging in a
| 6 | | business of selling such tangible personal property at retail | 7 | | within the
meaning of this Act; provided that any person who is | 8 | | engaged in a business
which is not subject to the tax imposed | 9 | | by this Act because of involving
the sale of or a contract to | 10 | | sell real estate or a construction contract to
improve real | 11 | | estate or a construction contract to engineer, install, and
| 12 | | maintain an integrated system of products, but who, in the | 13 | | course of
conducting such business,
transfers tangible | 14 | | personal property to users or consumers in the finished
form in | 15 | | which it was purchased, and which does not become real estate | 16 | | or was
not engineered and installed, under any provision of a | 17 | | construction contract or
real estate sale or real estate sales | 18 | | agreement entered into with some other
person arising out of or | 19 | | because of such nontaxable business, is engaged in the
business | 20 | | of selling tangible personal property at retail to the extent | 21 | | of the
value of the tangible personal property so transferred. | 22 | | If, in such a
transaction, a separate charge is made for the | 23 | | tangible personal property so
transferred, the value of such | 24 | | property, for the purpose of this Act, shall be
the amount so | 25 | | separately charged, but not less than the cost of such property
| 26 | | to the transferor; if no separate charge is made, the value of |
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| 1 | | such property,
for the purposes of this Act, is the cost to the | 2 | | transferor of such tangible
personal property. Construction | 3 | | contracts for the improvement of real estate
consisting of | 4 | | engineering, installation, and maintenance of voice, data, | 5 | | video,
security, and all telecommunication systems do not | 6 | | constitute engaging in a
business of selling tangible personal | 7 | | property at retail within the meaning of
this Act if they are | 8 | | sold at one specified contract price.
| 9 | | A person who holds himself or herself out as being engaged | 10 | | (or who habitually
engages) in selling tangible personal | 11 | | property at retail is a person
engaged in the business of | 12 | | selling tangible personal property at retail
hereunder with | 13 | | respect to such sales (and not primarily in a service
| 14 | | occupation) notwithstanding the fact that such person designs | 15 | | and produces
such tangible personal property on special order | 16 | | for the purchaser and in
such a way as to render the property | 17 | | of value only to such purchaser, if
such tangible personal | 18 | | property so produced on special order serves
substantially the | 19 | | same function as stock or standard items of tangible
personal | 20 | | property that are sold at retail.
| 21 | | Persons who engage in the business of transferring tangible | 22 | | personal
property upon the redemption of trading stamps are | 23 | | engaged in the business
of selling such property at retail and | 24 | | shall be liable for and shall pay
the tax imposed by this Act | 25 | | on the basis of the retail value of the
property transferred | 26 | | upon redemption of such stamps.
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| 1 | | "Bulk vending machine" means a vending machine,
containing | 2 | | unsorted confections, nuts, toys, or other items designed
| 3 | | primarily to be used or played with by children
which, when a | 4 | | coin or coins of a denomination not larger than $0.50 are
| 5 | | inserted, are dispensed in equal portions, at random and
| 6 | | without selection by the customer.
| 7 | | (Source: P.A. 98-628, eff. 1-1-15; 98-1080, eff. 8-26-14.)
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