Full Text of SB1970 100th General Assembly
SB1970 100TH GENERAL ASSEMBLY |
| | 100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018 SB1970 Introduced 2/10/2017, by Sen. Omar Aquino SYNOPSIS AS INTRODUCED: |
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Creates the Financial Transaction Tax Act. Imposes a tax on the privilege of engaging in a financial transaction that occurs, is effectuated, consummated, executed, or cleared at a facility located in the State. Provides that the tax is imposed at a rate of $1 per contract for all transactions for which the underlying asset is an agricultural product and $2 per contract for all other contracts. Effective immediately.
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| | | FISCAL NOTE ACT MAY APPLY | |
| | A BILL FOR |
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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 1. Short title. This Act may be cited as the | 5 | | Financial Transaction Tax Act. | 6 | | Section 5. Tax imposed; definitions. | 7 | | (a) Beginning September 1, 2017, a tax is imposed on the | 8 | | privilege of engaging in a financial transaction that occurs, | 9 | | is effectuated, consummated, executed, or cleared at a facility | 10 | | located in the State of Illinois. The tax is imposed at a rate | 11 | | of $1 per contract for all transactions for which the | 12 | | underlying asset is an agricultural product and $2 per contract | 13 | | for all other contracts. The tax shall be paid by both the | 14 | | seller of each such contract and the purchaser of each such | 15 | | contract. | 16 | | (b) A tax imposed under this Act, and all civil penalties | 17 | | that may be assessed as an incident thereof, shall be | 18 | | administered, collected, and enforced by the Department of | 19 | | Revenue, in the same manner as required under the Retailers' | 20 | | Occupation Tax Act insofar as may be applicable. The Department | 21 | | of Revenue has full power to administer and enforce this Act, | 22 | | to collect all taxes and penalties due under this Act, to | 23 | | dispose of taxes and penalties so collected as provided in this |
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| 1 | | Act, and to determine all rights to credit memoranda arising on | 2 | | account of the erroneous payment of tax or under this Act. The | 3 | | Department of Revenue shall pay over to the State Treasurer all | 4 | | taxes and penalties collected under this Act for deposit into | 5 | | the General Revenue Fund. | 6 | | (c) For the purpose of this Act, "financial transaction" | 7 | | means a transaction involving the purchase or sale of: | 8 | | (1) a "futures contract", defined as a contractual | 9 | | agreement to buy or sell a particular commodity or | 10 | | financial instrument at a pre-determined price in the | 11 | | future; | 12 | | (2) a "swap contract", defined as a contractual | 13 | | agreement to exchange the cash flows of one party's | 14 | | financial instrument for those of the other party's | 15 | | financial instrument; | 16 | | (3) a "credit default swap", defined as a swap designed | 17 | | to transfer the credit exposure of fixed income products | 18 | | between parties, including credit derivative contracts, | 19 | | where the purchaser of the swap makes payments up until the | 20 | | maturity date of a contract, and the seller agrees to pay | 21 | | off a third-party debt if this party defaults on the loan; | 22 | | (4) an "options contract", defined as a contract that | 23 | | allows the holder to buy or sell an underlying security or | 24 | | other financial instrument at a given price, including | 25 | | options on futures contracts and stock index options, but | 26 | | excluding options on individual stocks; |
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| 1 | | (5) an "option on a futures contract", or "futures | 2 | | option contract", defined as a contract that gives the | 3 | | holder the right to enter into a specified futures | 4 | | contract; | 5 | | (6) a "stock index option", defined as a contract that | 6 | | gives the holder the right, but not the obligation, to buy | 7 | | or sell a basket of stocks at an agreed-upon price and | 8 | | before a certain date; and | 9 | | (7) any other "derivatives", defined as a security or | 10 | | financial instrument the price which is dependent upon or | 11 | | derived from one or more underlying assets, that is not | 12 | | otherwise exempted by this Act. | 13 | | (d) For the purpose of this Act, "financial transaction" | 14 | | does not include a transaction involving securities held in a | 15 | | retirement account or a transaction involving a mutual fund. An | 16 | | exchange of securities or financial instruments identified in | 17 | | this Section shall be treated as a purchase of the securities | 18 | | or financial instruments received by each party to the | 19 | | exchange. | 20 | | Section 10. Rules. The Department shall adopt | 21 | | administrative rules to implement and administer this Act. | 22 | | Initial rules may be adopted as emergency rules.
| 23 | | Section 99. Effective date. This Act takes effect upon | 24 | | becoming law.
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