Full Text of HB2720 103rd General Assembly
HB2720 103RD GENERAL ASSEMBLY |
| | 103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024 HB2720 Introduced 2/16/2023, by Rep. Aaron M. Ortiz SYNOPSIS AS INTRODUCED: |
| 35 ILCS 105/2 | from Ch. 120, par. 439.2 | 35 ILCS 105/3-10 | | 35 ILCS 120/1 | from Ch. 120, par. 440 | 35 ILCS 120/2-10 | |
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Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides that, with respect to the sale of a manufactured home, if the purchase is the first purchase of the manufactured home for use as a dwelling and the purchaser certifies that the manufactured home will be affixed to a permanent foundation in the State, then the tax imposed by the Acts applies to 50% of the selling price (in the case of the Use Tax Act) or 50% of the gross receipts from the sale (in the case of the Retailers' Occupation Tax Act). Effective immediately.
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| | 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 5. The Use Tax Act is amended by changing Sections | 5 | | 2 and 3-10 as follows:
| 6 | | (35 ILCS 105/2) (from Ch. 120, par. 439.2)
| 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 | 10 | | ownership of that property,
except that it does not include | 11 | | the sale of such property in any form as
tangible personal | 12 | | property in the regular course of business to the extent
that | 13 | | such property is not first subjected to a use for which it was
| 14 | | purchased, and does not include the use of such property by its | 15 | | owner for
demonstration purposes: Provided that the property | 16 | | purchased is deemed to
be purchased for the purpose of resale, | 17 | | despite first being used, to the
extent to which it is resold | 18 | | as an ingredient of an intentionally produced
product or | 19 | | by-product of manufacturing. "Use" does not mean the | 20 | | demonstration
use or interim use of tangible personal property | 21 | | by a retailer before he sells
that tangible personal property. | 22 | | For watercraft or aircraft, if the period of
demonstration use | 23 | | or interim use by the retailer exceeds 18 months,
the retailer
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| 1 | | shall pay on the retailers' original cost price the tax | 2 | | imposed by this Act,
and no credit for that tax is permitted if | 3 | | the watercraft or aircraft is
subsequently sold by the | 4 | | retailer. "Use" does not mean the physical
incorporation of | 5 | | tangible personal property, to the extent not first subjected
| 6 | | to a use for which it was purchased, as an ingredient or | 7 | | constituent, into
other tangible personal property (a) which | 8 | | is sold in the regular course of
business or (b) which the | 9 | | person incorporating such ingredient or constituent
therein | 10 | | has undertaken at the time of such purchase to cause to be | 11 | | transported
in interstate commerce to destinations outside the | 12 | | State of Illinois: Provided
that the property purchased is | 13 | | deemed to be purchased for the purpose of
resale, despite | 14 | | first being used, to the extent to which it is resold as an
| 15 | | ingredient of an intentionally produced product or by-product | 16 | | of manufacturing.
| 17 | | "Watercraft" means a Class 2, Class 3, or Class 4 | 18 | | watercraft as defined in
Section 3-2 of the Boat Registration | 19 | | and Safety Act, a personal watercraft, or
any boat equipped | 20 | | with an inboard motor.
| 21 | | "Purchase at retail" means the acquisition of the | 22 | | ownership of or title
to tangible personal property through a | 23 | | sale at retail.
| 24 | | "Purchaser" means anyone who, through a sale at retail, | 25 | | acquires the
ownership of tangible personal property for a | 26 | | valuable consideration.
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| 1 | | "Sale at retail" means any transfer of the ownership of or | 2 | | title to
tangible personal property to a purchaser, for the | 3 | | purpose of use, and not
for the purpose of resale in any form | 4 | | as tangible personal property to the
extent not first | 5 | | subjected to a use for which it was purchased, for a
valuable | 6 | | consideration: Provided that the property purchased is deemed | 7 | | to
be purchased for the purpose of resale, despite first being | 8 | | used, to the
extent to which it is resold as an ingredient of | 9 | | an intentionally produced
product or by-product of | 10 | | manufacturing. For this purpose, slag produced as
an incident | 11 | | to manufacturing pig iron or steel and sold is considered to be
| 12 | | an intentionally produced by-product of manufacturing. "Sale | 13 | | at retail"
includes any such transfer made for resale unless | 14 | | made in compliance with
Section 2c of the Retailers' | 15 | | Occupation Tax Act, as incorporated by
reference into Section | 16 | | 12 of this Act. Transactions whereby the possession
of the | 17 | | property is transferred but the seller retains the title as | 18 | | security
for payment of the selling price are sales.
| 19 | | "Sale at retail" shall also be construed to include any | 20 | | Illinois
florist's sales transaction in which the purchase | 21 | | order is received in
Illinois by a florist and the sale is for | 22 | | use or consumption, but the
Illinois florist has a florist in | 23 | | another state deliver the property to the
purchaser or the | 24 | | purchaser's donee in such other state.
| 25 | | Nonreusable tangible personal property that is used by | 26 | | persons engaged in
the business of operating a restaurant, |
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| 1 | | cafeteria, or drive-in is a sale for
resale when it is | 2 | | transferred to customers in the ordinary course of business
as | 3 | | part of the sale of food or beverages and is used to deliver, | 4 | | package, or
consume food or beverages, regardless of where | 5 | | consumption of the food or
beverages occurs. Examples of those | 6 | | items include, but are not limited to
nonreusable, paper and | 7 | | plastic cups, plates, baskets, boxes, sleeves, buckets
or | 8 | | other containers, utensils, straws, placemats, napkins, doggie | 9 | | bags, and
wrapping or packaging
materials that are transferred | 10 | | to customers as part of the sale of food or
beverages in the | 11 | | ordinary course of business.
| 12 | | The purchase, employment and transfer of such tangible | 13 | | personal property
as newsprint and ink for the primary purpose | 14 | | of conveying news (with or
without other information) is not a | 15 | | purchase, use or sale of tangible
personal property.
| 16 | | "Selling price" means the consideration for a sale valued | 17 | | in money
whether received in money or otherwise, including | 18 | | cash, credits, property
other than as hereinafter provided, | 19 | | and services, but, prior to January 1, 2020 and beginning | 20 | | again on January 1, 2022, not including the
value of or credit | 21 | | given for traded-in tangible personal property where the
item | 22 | | that is traded-in is of like kind and character as that which | 23 | | is being
sold; beginning January 1, 2020 and until January 1, | 24 | | 2022, "selling price" includes the portion of the value of or | 25 | | credit given for traded-in motor vehicles of the First | 26 | | Division as defined in Section 1-146 of the Illinois Vehicle |
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| 1 | | Code of like kind and character as that which is being sold | 2 | | that exceeds $10,000. "Selling price" shall be determined | 3 | | without any deduction on account of the cost
of the property | 4 | | sold, the cost of materials used, labor or service cost or
any | 5 | | other expense whatsoever, but does not include interest or | 6 | | finance
charges which appear as separate items on the bill of | 7 | | sale or sales
contract nor charges that are added to prices by | 8 | | sellers on account of the
seller's tax liability under the | 9 | | Retailers' Occupation Tax Act, or on
account of the seller's | 10 | | duty to collect, from the purchaser, the tax that
is imposed by | 11 | | this Act, or, except as otherwise provided with respect to any | 12 | | cigarette tax imposed by a home rule unit, on account of the | 13 | | seller's tax liability under any local occupation tax | 14 | | administered by the Department, or, except as otherwise | 15 | | provided with respect to any cigarette tax imposed by a home | 16 | | rule unit on account of the seller's duty to collect, from the | 17 | | purchasers, the tax that is imposed under any local use tax | 18 | | administered by the Department. Effective December 1, 1985, | 19 | | "selling price"
shall include charges that are added to prices | 20 | | by sellers on account of the
seller's tax liability under the | 21 | | Cigarette Tax Act, on account of the seller's
duty to collect, | 22 | | from the purchaser, the tax imposed under the Cigarette Use
| 23 | | Tax Act, and on account of the seller's duty to collect, from | 24 | | the purchaser,
any cigarette tax imposed by a home rule unit.
| 25 | | Notwithstanding any law to the contrary, for any motor | 26 | | vehicle, as defined in Section 1-146 of the Vehicle Code, that |
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| 1 | | is sold on or after January 1, 2015 for the purpose of leasing | 2 | | the vehicle for a defined period that is longer than one year | 3 | | and (1) is a motor vehicle of the second division that: (A) is | 4 | | a self-contained motor vehicle designed or permanently | 5 | | converted to provide living quarters for recreational, | 6 | | camping, or travel use, with direct walk through access to the | 7 | | living quarters from the driver's seat; (B) is of the van | 8 | | configuration designed for the transportation of not less than | 9 | | 7 nor more than 16 passengers; or (C) has a gross vehicle | 10 | | weight rating of 8,000 pounds or less or (2) is a motor vehicle | 11 | | of the first division, "selling price" or "amount of sale" | 12 | | means the consideration received by the lessor pursuant to the | 13 | | lease contract, including amounts due at lease signing and all | 14 | | monthly or other regular payments charged over the term of the | 15 | | lease. Also included in the selling price is any amount | 16 | | received by the lessor from the lessee for the leased vehicle | 17 | | that is not calculated at the time the lease is executed, | 18 | | including, but not limited to, excess mileage charges and | 19 | | charges for excess wear and tear. For sales that occur in | 20 | | Illinois, with respect to any amount received by the lessor | 21 | | from the lessee for the leased vehicle that is not calculated | 22 | | at the time the lease is executed, the lessor who purchased the | 23 | | motor vehicle does not incur the tax imposed by the Use Tax Act | 24 | | on those amounts, and the retailer who makes the retail sale of | 25 | | the motor vehicle to the lessor is not required to collect the | 26 | | tax imposed by this Act or to pay the tax imposed by the |
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| 1 | | Retailers' Occupation Tax Act on those amounts. However, the | 2 | | lessor who purchased the motor vehicle assumes the liability | 3 | | for reporting and paying the tax on those amounts directly to | 4 | | the Department in the same form (Illinois Retailers' | 5 | | Occupation Tax, and local retailers' occupation taxes, if | 6 | | applicable) in which the retailer would have reported and paid | 7 | | such tax if the retailer had accounted for the tax to the | 8 | | Department. For amounts received by the lessor from the lessee | 9 | | that are not calculated at the time the lease is executed, the | 10 | | lessor must file the return and pay the tax to the Department | 11 | | by the due date otherwise required by this Act for returns | 12 | | other than transaction returns. If the retailer is entitled | 13 | | under this Act to a discount for collecting and remitting the | 14 | | tax imposed under this Act to the Department with respect to | 15 | | the sale of the motor vehicle to the lessor, then the right to | 16 | | the discount provided in this Act shall be transferred to the | 17 | | lessor with respect to the tax paid by the lessor for any | 18 | | amount received by the lessor from the lessee for the leased | 19 | | vehicle that is not calculated at the time the lease is | 20 | | executed; provided that the discount is only allowed if the | 21 | | return is timely filed and for amounts timely paid. The | 22 | | "selling price" of a motor vehicle that is sold on or after | 23 | | January 1, 2015 for the purpose of leasing for a defined period | 24 | | of longer than one year shall not be reduced by the value of or | 25 | | credit given for traded-in tangible personal property owned by | 26 | | the lessor, nor shall it be reduced by the value of or credit |
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| 1 | | given for traded-in tangible personal property owned by the | 2 | | lessee, regardless of whether the trade-in value thereof is | 3 | | assigned by the lessee to the lessor. In the case of a motor | 4 | | vehicle that is sold for the purpose of leasing for a defined | 5 | | period of longer than one year, the sale occurs at the time of | 6 | | the delivery of the vehicle, regardless of the due date of any | 7 | | lease payments. A lessor who incurs a Retailers' Occupation | 8 | | Tax liability on the sale of a motor vehicle coming off lease | 9 | | may not take a credit against that liability for the Use Tax | 10 | | the lessor paid upon the purchase of the motor vehicle (or for | 11 | | any tax the lessor paid with respect to any amount received by | 12 | | the lessor from the lessee for the leased vehicle that was not | 13 | | calculated at the time the lease was executed) if the selling | 14 | | price of the motor vehicle at the time of purchase was | 15 | | calculated using the definition of "selling price" as defined | 16 | | in this paragraph. Notwithstanding any other provision of this | 17 | | Act to the contrary, lessors shall file all returns and make | 18 | | all payments required under this paragraph to the Department | 19 | | by electronic means in the manner and form as required by the | 20 | | Department. This paragraph does not apply to leases of motor | 21 | | vehicles for which, at the time the lease is entered into, the | 22 | | term of the lease is not a defined period, including leases | 23 | | with a defined initial period with the option to continue the | 24 | | lease on a month-to-month or other basis beyond the initial | 25 | | defined period. | 26 | | The phrase "like kind and character" shall be liberally |
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| 1 | | construed
(including but not limited to any form of motor | 2 | | vehicle for any form of
motor vehicle, or any kind of farm or | 3 | | agricultural implement for any other
kind of farm or | 4 | | agricultural implement), while not including a kind of item
| 5 | | which, if sold at retail by that retailer, would be exempt from | 6 | | retailers'
occupation tax and use tax as an isolated or | 7 | | occasional sale.
| 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 | | "Retailer" means and includes every person engaged in the | 15 | | business of
making sales at retail as defined in this Section.
| 16 | | A person who holds himself or herself out as being engaged | 17 | | (or who habitually
engages) in selling tangible personal | 18 | | property at retail is a retailer
hereunder with respect to | 19 | | such sales (and not primarily in a service
occupation) | 20 | | notwithstanding the fact that such person designs and produces
| 21 | | such tangible personal property on special order for the | 22 | | purchaser and in
such a way as to render the property of value | 23 | | only to such purchaser, if
such tangible personal property so | 24 | | produced on special order serves
substantially the same | 25 | | function as stock or standard items of tangible
personal | 26 | | property that are sold at retail.
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| 1 | | A person whose activities are organized and conducted | 2 | | primarily as a
not-for-profit service enterprise, and who | 3 | | engages in selling tangible
personal property at retail | 4 | | (whether to the public or merely to members and
their guests) | 5 | | is a retailer 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. This
| 16 | | paragraph does not apply to nor subject to taxation occasional | 17 | | dinners,
social or similar activities of a person organized | 18 | | and operated exclusively
for charitable, religious or | 19 | | educational purposes, whether or not such
activities are open | 20 | | 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 a
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| 1 | | retailer under this Act with respect to such transactions.
| 2 | | Persons who engage in the business of transferring | 3 | | tangible personal
property upon the redemption of trading | 4 | | stamps are retailers hereunder when
engaged in such business.
| 5 | | The isolated or occasional sale of tangible personal | 6 | | property at retail
by a person who does not hold himself out as | 7 | | being engaged (or who does not
habitually engage) in selling | 8 | | such tangible personal property at retail or
a sale through a | 9 | | bulk vending machine does not make such person a retailer
| 10 | | hereunder. However, any person who is engaged in a business | 11 | | which is not
subject to the tax imposed by the Retailers' | 12 | | Occupation Tax Act because
of involving the sale of or a | 13 | | contract to sell real estate or a
construction contract to | 14 | | improve real estate, but who, in the course of
conducting such | 15 | | business, transfers tangible personal property to users or
| 16 | | consumers in the finished form in which it was purchased, and | 17 | | which does
not become real estate, under any provision of a | 18 | | construction contract or
real estate sale or real estate sales | 19 | | agreement entered into with some
other person arising out of | 20 | | or because of such nontaxable business, is a
retailer to the | 21 | | extent of the value of the tangible personal property so
| 22 | | transferred. If, in such transaction, a separate charge is | 23 | | made for the
tangible personal property so transferred, the | 24 | | value of such property, for
the purposes of this Act, is the | 25 | | amount so separately charged, but not less
than the cost of | 26 | | such property to the transferor; if no separate charge is
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| 1 | | made, the value of such property, for the purposes of this Act, | 2 | | is the cost
to the transferor of such tangible personal | 3 | | property.
| 4 | | "Retailer maintaining a place of business in this State", | 5 | | or any like
term, means and includes any of the following | 6 | | retailers:
| 7 | | (1) A retailer having or maintaining within this | 8 | | State, directly or by
a subsidiary, an office, | 9 | | distribution house, sales house, warehouse or other
place | 10 | | of business, or any agent or other representative | 11 | | operating within this
State under the authority of the | 12 | | retailer or its subsidiary, irrespective of
whether such | 13 | | place of business or agent or other representative is | 14 | | located here
permanently or temporarily, or whether such | 15 | | retailer or subsidiary is licensed
to do business in this | 16 | | State. However, the ownership of property that is
located | 17 | | at the premises of a printer with which the retailer has | 18 | | contracted for
printing and that consists of the final | 19 | | printed product, property that becomes
a part of the final | 20 | | printed product, or copy from which the printed product is
| 21 | | produced shall not result in the retailer being deemed to | 22 | | have or maintain an
office, distribution house, sales | 23 | | house, warehouse, or other place of business
within this | 24 | | State. | 25 | | (1.1) A retailer having a contract with a person | 26 | | located in this State under which the person, for a |
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| 1 | | commission or other consideration based upon the sale of | 2 | | tangible personal property by the retailer, directly or | 3 | | indirectly refers potential customers to the retailer by | 4 | | providing to the potential customers a promotional code or | 5 | | other mechanism that allows the retailer to track | 6 | | purchases referred by such persons. Examples of mechanisms | 7 | | that allow the retailer to track purchases referred by | 8 | | such persons include but are not limited to the use of a | 9 | | link on the person's Internet website, promotional codes | 10 | | distributed through the person's hand-delivered or mailed | 11 | | material, and promotional codes distributed by the person | 12 | | through radio or other broadcast media. The provisions of | 13 | | this paragraph (1.1) shall apply only if the cumulative | 14 | | gross receipts from sales of tangible personal property by | 15 | | the retailer to customers who are referred to the retailer | 16 | | by all persons in this State under such contracts exceed | 17 | | $10,000 during the preceding 4 quarterly periods ending on | 18 | | the last day of March, June, September, and December. A | 19 | | retailer meeting the requirements of this paragraph (1.1) | 20 | | shall be presumed to be maintaining a place of business in | 21 | | this State but may rebut this presumption by submitting | 22 | | proof that the referrals or other activities pursued | 23 | | within this State by such persons were not sufficient to | 24 | | meet the nexus standards of the United States Constitution | 25 | | during the preceding 4 quarterly periods. | 26 | | (1.2) Beginning July 1, 2011, a retailer having a |
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| 1 | | contract with a person located in this State under which: | 2 | | (A) the retailer sells the same or substantially | 3 | | similar line of products as the person located in this | 4 | | State and does so using an identical or substantially | 5 | | similar name, trade name, or trademark as the person | 6 | | located in this State; and | 7 | | (B) the retailer provides a commission or other | 8 | | consideration to the person located in this State | 9 | | based upon the sale of tangible personal property by | 10 | | the retailer. | 11 | | The provisions of this paragraph (1.2) shall apply | 12 | | only if the cumulative gross receipts from sales of | 13 | | tangible personal property by the retailer to customers in | 14 | | this State under all such contracts exceed $10,000 during | 15 | | the preceding 4 quarterly periods ending on the last day | 16 | | of March, June, September, and December.
| 17 | | (2) (Blank).
| 18 | | (3) (Blank).
| 19 | | (4) (Blank).
| 20 | | (5) (Blank).
| 21 | | (6) (Blank).
| 22 | | (7) (Blank).
| 23 | | (8) (Blank).
| 24 | | (9) Beginning October 1, 2018, a retailer making sales | 25 | | of tangible personal property to purchasers in Illinois | 26 | | from outside of Illinois if: |
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| 1 | | (A) the cumulative gross receipts from sales of | 2 | | tangible personal property to purchasers in Illinois | 3 | | are $100,000 or more; or | 4 | | (B) the retailer enters into 200 or more separate | 5 | | transactions for the sale of tangible personal | 6 | | property to purchasers in Illinois. | 7 | | The retailer shall determine on a quarterly basis, | 8 | | ending on the last day of March, June, September, and | 9 | | December, whether he or she meets the criteria of either | 10 | | subparagraph (A) or (B) of this paragraph (9) for the | 11 | | preceding 12-month period. If the retailer meets the | 12 | | threshold of either subparagraph (A) or (B) for a 12-month | 13 | | period, he or she is considered a retailer maintaining a | 14 | | place of business in this State and is required to collect | 15 | | and remit the tax imposed under this Act and file returns | 16 | | for one year. At the end of that one-year period, the | 17 | | retailer shall determine whether he or she met the | 18 | | threshold of either subparagraph (A) or (B) during the | 19 | | preceding 12-month period. If the retailer met the | 20 | | criteria in either subparagraph (A) or (B) for the | 21 | | preceding 12-month period, he or she is considered a | 22 | | retailer maintaining a place of business in this State and | 23 | | is required to collect and remit the tax imposed under | 24 | | this Act and file returns for the subsequent year. If at | 25 | | the end of a one-year period a retailer that was required | 26 | | to collect and remit the tax imposed under this Act |
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| 1 | | determines that he or she did not meet the threshold in | 2 | | either subparagraph (A) or (B) during the preceding | 3 | | 12-month period, the retailer shall subsequently determine | 4 | | on a quarterly basis, ending on the last day of March, | 5 | | June, September, and December, whether he or she meets the | 6 | | threshold of either subparagraph (A) or (B) for the | 7 | | preceding 12-month period. | 8 | | Beginning January 1, 2020, neither the gross receipts | 9 | | from nor the number of separate transactions for sales of | 10 | | tangible personal property to purchasers in Illinois that | 11 | | a retailer makes through a marketplace facilitator and for | 12 | | which the retailer has received a certification from the | 13 | | marketplace facilitator pursuant to Section 2d of this Act | 14 | | shall be included for purposes of determining whether he | 15 | | or she has met the thresholds of this paragraph (9). | 16 | | (10) Beginning January 1, 2020, a marketplace | 17 | | facilitator that meets a threshold set forth in subsection | 18 | | (b) of Section 2d of this Act. | 19 | | "Bulk vending machine" means a vending machine,
containing | 20 | | unsorted confections, nuts, toys, or other items designed
| 21 | | primarily to be used or played with by children
which, when a | 22 | | coin or coins of a denomination not larger than $0.50 are | 23 | | inserted, are dispensed in equal portions, at random and
| 24 | | without selection by the customer.
| 25 | | As used in Section 3-10, "manufactured home" means a | 26 | | factory-assembled, completely integrated structure designed |
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| 1 | | for permanent habitation that: | 2 | | (1) is designed to be used as a single-family dwelling | 3 | | which complies with the standards established under 42 | 4 | | U.S.C. 70; | 5 | | (2) is transportable in one or more sections; | 6 | | (3) is installed according to the manufacturer's | 7 | | instructions and connected to residential utilities for | 8 | | year-round occupancy; and | 9 | | (4) contains an area of at least 320 square feet. | 10 | | (Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 1-1-20; | 11 | | 101-604, eff. 1-1-20; 102-353, eff. 1-1-22 .)
| 12 | | (35 ILCS 105/3-10)
| 13 | | Sec. 3-10. Rate of tax. Unless otherwise provided in this | 14 | | Section, the tax
imposed by this Act is at the rate of 6.25% of | 15 | | either the selling price or the
fair market value, if any, of | 16 | | the tangible personal property. In all cases
where property | 17 | | functionally used or consumed is the same as the property that
| 18 | | was purchased at retail, then the tax is imposed on the selling | 19 | | price of the
property. In all cases where property | 20 | | functionally used or consumed is a
by-product or waste product | 21 | | that has been refined, manufactured, or produced
from property | 22 | | purchased at retail, then the tax is imposed on the lower of | 23 | | the
fair market value, if any, of the specific property so used | 24 | | in this State or on
the selling price of the property purchased | 25 | | at retail. For purposes of this
Section "fair market value" |
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| 1 | | means the price at which property would change
hands between a | 2 | | willing buyer and a willing seller, neither being under any
| 3 | | compulsion to buy or sell and both having reasonable knowledge | 4 | | of the
relevant facts. The fair market value shall be | 5 | | established by Illinois sales by
the taxpayer of the same | 6 | | property as that functionally used or consumed, or if
there | 7 | | are no such sales by the taxpayer, then comparable sales or | 8 | | purchases of
property of like kind and character in Illinois.
| 9 | | Beginning on July 1, 2000 and through December 31, 2000, | 10 | | with respect to
motor fuel, as defined in Section 1.1 of the | 11 | | Motor Fuel Tax
Law, and gasohol, as defined in Section 3-40 of | 12 | | the Use Tax Act, the tax is
imposed at the rate of 1.25%.
| 13 | | Beginning on August 6, 2010 through August 15, 2010, and | 14 | | beginning again on August 5, 2022 through August 14, 2022, | 15 | | with respect to sales tax holiday items as defined in Section | 16 | | 3-6 of this Act, the
tax is imposed at the rate of 1.25%. | 17 | | With respect to gasohol, the tax imposed by this Act | 18 | | applies to (i) 70%
of the proceeds of sales made on or after | 19 | | January 1, 1990, and before
July 1, 2003, (ii) 80% of the | 20 | | proceeds of sales made
on or after July 1, 2003 and on or | 21 | | before July 1, 2017, and (iii) 100% of the proceeds of sales | 22 | | made
thereafter.
If, at any time, however, the tax under this | 23 | | Act on sales of gasohol is
imposed at the
rate of 1.25%, then | 24 | | the tax imposed by this Act applies to 100% of the proceeds
of | 25 | | sales of gasohol made during that time.
| 26 | | With respect to majority blended ethanol fuel, the tax |
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| 1 | | imposed by this Act
does
not apply
to the proceeds of sales | 2 | | made on or after July 1, 2003 and on or before
December 31, | 3 | | 2023 but applies to 100% of the proceeds of sales made | 4 | | thereafter.
| 5 | | With respect to biodiesel blends with no less than 1% and | 6 | | no more than 10%
biodiesel, the tax imposed by this Act applies | 7 | | to (i) 80% of the
proceeds of sales made on or after July 1, | 8 | | 2003 and on or before December 31, 2018
and (ii) 100% of the | 9 | | proceeds of sales made
after December 31, 2018 and before | 10 | | January 1, 2024. On and after January 1, 2024 and on or before | 11 | | December 31, 2030, the taxation of biodiesel, renewable | 12 | | diesel, and biodiesel blends shall be as provided in Section | 13 | | 3-5.1.
If, at any time, however, the tax under this Act on | 14 | | sales of biodiesel blends
with no less than 1% and no more than | 15 | | 10% biodiesel
is imposed at the rate of
1.25%, then the
tax | 16 | | imposed by this Act applies to 100% of the proceeds of sales of | 17 | | biodiesel
blends with no less than 1% and no more than 10% | 18 | | biodiesel
made
during that time.
| 19 | | With respect to biodiesel and biodiesel blends with more | 20 | | than 10%
but no more than 99% biodiesel, the tax imposed by | 21 | | this Act does not apply to
the
proceeds of sales made on or | 22 | | after July 1, 2003 and on or before
December 31, 2023. On and | 23 | | after January 1, 2024 and on or before December 31, 2030, the | 24 | | taxation of biodiesel, renewable diesel, and biodiesel blends | 25 | | shall be as provided in Section 3-5.1.
| 26 | | On and after January 1, 2024, with respect to the sale of a |
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| 1 | | manufactured home, as defined in Section 2, if the purchase is | 2 | | the first purchase of the manufactured home for use as a | 3 | | dwelling and the purchaser who will use the home as a dwelling | 4 | | certifies that the manufactured home will be affixed to a | 5 | | permanent foundation in the State so that the manufactured | 6 | | home is deemed to be real property under the Conveyance and | 7 | | Encumbrance of Manufactured Homes as Real Property and | 8 | | Severance Act, then the tax imposed by this Act applies to 50% | 9 | | of the selling price of the manufactured home. The seller, | 10 | | whether acting as a construction contractor or not, must | 11 | | retain the purchaser's certification in his or her books and | 12 | | records for a period of 7 years after the date of the sale. | 13 | | This paragraph is exempt from the provisions of Section 3-90. | 14 | | Until July 1, 2022 and beginning again on July 1, 2023, | 15 | | with respect to food for human consumption that is to be | 16 | | consumed off the
premises where it is sold (other than | 17 | | alcoholic beverages, food consisting of or infused with adult | 18 | | use cannabis, soft drinks, and
food that has been prepared for | 19 | | immediate consumption), the tax is imposed at the rate of 1%. | 20 | | Beginning on July 1, 2022 and until July 1, 2023, with respect | 21 | | to food for human consumption that is to be consumed off the | 22 | | premises where it is sold (other than alcoholic beverages, | 23 | | food consisting of or infused with adult use cannabis, soft | 24 | | drinks, and food that has been prepared for immediate | 25 | | consumption), the tax is imposed at the rate of 0%. | 26 | | With respect to prescription and
nonprescription |
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| 1 | | medicines, drugs, medical appliances, products classified as | 2 | | Class III medical devices by the United States Food and Drug | 3 | | Administration that are used for cancer treatment pursuant to | 4 | | a prescription, as well as any accessories and components | 5 | | related to those devices, modifications to a motor
vehicle for | 6 | | the purpose of rendering it usable by a person with a | 7 | | disability, and
insulin, blood sugar testing materials, | 8 | | syringes, and needles used by human diabetics, the tax is | 9 | | imposed at the rate of 1%. For the purposes of this
Section, | 10 | | until September 1, 2009: the term "soft drinks" means any | 11 | | complete, finished, ready-to-use,
non-alcoholic drink, whether | 12 | | carbonated or not, including , but not limited to ,
soda water, | 13 | | cola, fruit juice, vegetable juice, carbonated water, and all | 14 | | other
preparations commonly known as soft drinks of whatever | 15 | | kind or description that
are contained in any closed or sealed | 16 | | bottle, can, carton, or container,
regardless of size; but | 17 | | "soft drinks" does not include coffee, tea, non-carbonated
| 18 | | water, infant formula, milk or milk products as defined in the | 19 | | Grade A
Pasteurized Milk and Milk Products Act, or drinks | 20 | | containing 50% or more
natural fruit or vegetable juice.
| 21 | | Notwithstanding any other provisions of this
Act, | 22 | | beginning September 1, 2009, "soft drinks" means non-alcoholic | 23 | | beverages that contain natural or artificial sweeteners. "Soft | 24 | | drinks" does do not include beverages that contain milk or | 25 | | milk products, soy, rice or similar milk substitutes, or | 26 | | greater than 50% of vegetable or fruit juice by volume. |
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| 1 | | Until August 1, 2009, and notwithstanding any other | 2 | | provisions of this
Act, "food for human consumption that is to | 3 | | be consumed off the premises where
it is sold" includes all | 4 | | food sold through a vending machine, except soft
drinks and | 5 | | food products that are dispensed hot from a vending machine,
| 6 | | regardless of the location of the vending machine. Beginning | 7 | | August 1, 2009, and notwithstanding any other provisions of | 8 | | this Act, "food for human consumption that is to be consumed | 9 | | off the premises where it is sold" includes all food sold | 10 | | through a vending machine, except soft drinks, candy, and food | 11 | | products that are dispensed hot from a vending machine, | 12 | | regardless of the location of the vending machine.
| 13 | | Notwithstanding any other provisions of this
Act, | 14 | | beginning September 1, 2009, "food for human consumption that | 15 | | is to be consumed off the premises where
it is sold" does not | 16 | | include candy. For purposes of this Section, "candy" means a | 17 | | preparation of sugar, honey, or other natural or artificial | 18 | | sweeteners in combination with chocolate, fruits, nuts or | 19 | | other ingredients or flavorings in the form of bars, drops, or | 20 | | pieces. "Candy" does not include any preparation that contains | 21 | | flour or requires refrigeration. | 22 | | Notwithstanding any other provisions of this
Act, | 23 | | beginning September 1, 2009, "nonprescription medicines and | 24 | | drugs" does not include grooming and hygiene products. For | 25 | | purposes of this Section, "grooming and hygiene products" | 26 | | includes, but is not limited to, soaps and cleaning solutions, |
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| 1 | | shampoo, toothpaste, mouthwash, antiperspirants, and sun tan | 2 | | lotions and screens, unless those products are available by | 3 | | prescription only, regardless of whether the products meet the | 4 | | definition of "over-the-counter-drugs". For the purposes of | 5 | | this paragraph, "over-the-counter-drug" means a drug for human | 6 | | use that contains a label that identifies the product as a drug | 7 | | as required by 21 CFR C.F.R. § 201.66. The | 8 | | "over-the-counter-drug" label includes: | 9 | | (A) a A "Drug Facts" panel; or | 10 | | (B) a A statement of the "active ingredient(s)" with a | 11 | | list of those ingredients contained in the compound, | 12 | | substance or preparation. | 13 | | Beginning on January 1, 2014 ( the effective date of Public | 14 | | Act 98-122) this amendatory Act of the 98th General Assembly , | 15 | | "prescription and nonprescription medicines and drugs" | 16 | | includes medical cannabis purchased from a registered | 17 | | dispensing organization under the Compassionate Use of Medical | 18 | | Cannabis Program Act. | 19 | | As used in this Section, "adult use cannabis" means | 20 | | cannabis subject to tax under the Cannabis Cultivation | 21 | | Privilege Tax Law and the Cannabis Purchaser Excise Tax Law | 22 | | and does not include cannabis subject to tax under the | 23 | | Compassionate Use of Medical Cannabis Program Act. | 24 | | If the property that is purchased at retail from a | 25 | | retailer is acquired
outside Illinois and used outside | 26 | | Illinois before being brought to Illinois
for use here and is |
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| 1 | | taxable under this Act, the "selling price" on which
the tax is | 2 | | computed shall be reduced by an amount that represents a
| 3 | | reasonable allowance for depreciation for the period of prior | 4 | | out-of-state use.
| 5 | | (Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19; | 6 | | 102-4, eff. 4-27-21; 102-700, Article 20, Section 20-5, eff. | 7 | | 4-19-22; 102-700, Article 60, Section 60-15, eff. 4-19-22; | 8 | | 102-700, Article 65, Section 65-5, eff. 4-19-22; revised | 9 | | 5-27-22.)
| 10 | | Section 10. The Retailers' Occupation Tax Act is amended | 11 | | by changing Sections 1 and 2-10 as follows:
| 12 | | (35 ILCS 120/1) (from Ch. 120, par. 440)
| 13 | | Sec. 1. Definitions. "Sale at retail" means any transfer | 14 | | of the
ownership of or title to
tangible personal property to a | 15 | | purchaser, for the purpose of use or
consumption, and not for | 16 | | the purpose of resale in any form as tangible
personal | 17 | | property to the extent not first subjected to a use for which | 18 | | it
was purchased, for a valuable consideration: Provided that | 19 | | the property
purchased is deemed to be purchased for the | 20 | | purpose of resale, despite
first being used, to the extent to | 21 | | which it is resold as an ingredient of
an intentionally | 22 | | produced product or byproduct of manufacturing. For this
| 23 | | purpose, slag produced as an incident to manufacturing pig | 24 | | iron or steel
and sold is considered to be an intentionally |
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| 1 | | produced byproduct of
manufacturing. Transactions whereby the | 2 | | possession of the property is
transferred but the seller | 3 | | retains the title as security for payment of the
selling price | 4 | | shall be deemed to be sales.
| 5 | | "Sale at retail" shall be construed to include any | 6 | | transfer of the
ownership of or title to tangible personal | 7 | | property to a purchaser, for use
or consumption by any other | 8 | | person to whom such purchaser may transfer the
tangible | 9 | | personal property without a valuable consideration, and to | 10 | | include
any transfer, whether made for or without a valuable | 11 | | consideration, for
resale in any form as tangible personal | 12 | | property unless made in compliance
with Section 2c of this | 13 | | Act.
| 14 | | Sales of tangible personal property, which property, to | 15 | | the extent not
first subjected to a use for which it was | 16 | | purchased, as an ingredient or
constituent, goes into and | 17 | | forms a part of tangible personal property
subsequently the | 18 | | subject of a "Sale at retail", are not sales at retail as
| 19 | | defined in this Act: Provided that the property purchased is | 20 | | deemed to be
purchased for the purpose of resale, despite | 21 | | first being used, to the
extent to which it is resold as an | 22 | | ingredient of an intentionally produced
product or byproduct | 23 | | of manufacturing.
| 24 | | "Sale at retail" shall be construed to include any | 25 | | Illinois florist's
sales transaction in which the purchase | 26 | | order is received in Illinois by a
florist and the sale is for |
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| 1 | | use or consumption, but the Illinois florist
has a florist in | 2 | | another state deliver the property to the purchaser or the
| 3 | | purchaser's donee in such other state.
| 4 | | Nonreusable tangible personal property that is used by | 5 | | persons engaged in
the business of operating a restaurant, | 6 | | cafeteria, or drive-in is a sale for
resale when it is | 7 | | transferred to customers in the ordinary course of business
as | 8 | | part of the sale of food or beverages and is used to deliver, | 9 | | package, or
consume food or beverages, regardless of where | 10 | | consumption of the food or
beverages occurs. Examples of those | 11 | | items include, but are not limited to
nonreusable, paper and | 12 | | plastic cups, plates, baskets, boxes, sleeves, buckets
or | 13 | | other containers, utensils, straws, placemats, napkins, doggie | 14 | | bags, and
wrapping or packaging
materials that are transferred | 15 | | to customers as part of the sale of food or
beverages in the | 16 | | ordinary course of business.
| 17 | | The purchase, employment and transfer of such tangible | 18 | | personal property
as newsprint and ink for the primary purpose | 19 | | of conveying news (with or
without other information) is not a | 20 | | purchase, use or sale of tangible
personal property.
| 21 | | A person whose activities are organized and conducted | 22 | | primarily as a
not-for-profit service enterprise, and who | 23 | | engages in selling tangible
personal property at retail | 24 | | (whether to the public or merely to members and
their guests) | 25 | | is engaged in the business of selling tangible personal
| 26 | | property at retail with respect to such transactions, |
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| 1 | | excepting only a
person organized and operated exclusively for | 2 | | charitable, religious or
educational purposes either (1), to | 3 | | the extent of sales by such person to
its members, students, | 4 | | patients or inmates of tangible personal property to
be used | 5 | | primarily for the purposes of such person, or (2), to the | 6 | | extent of
sales by such person of tangible personal property | 7 | | which is not sold or
offered for sale by persons organized for | 8 | | profit. The selling of school
books and school supplies by | 9 | | schools at retail to students is not
"primarily for the | 10 | | purposes of" the school which does such selling. The
| 11 | | provisions of this paragraph shall not apply to nor subject to | 12 | | taxation
occasional dinners, socials or similar activities of | 13 | | a person organized and
operated exclusively for charitable, | 14 | | religious or educational purposes,
whether or not such | 15 | | activities are open to the public.
| 16 | | A person who is the recipient of a grant or contract under | 17 | | Title VII of
the Older Americans Act of 1965 (P.L. 92-258) and | 18 | | serves meals to
participants in the federal Nutrition Program | 19 | | for the Elderly in return for
contributions established in | 20 | | amount by the individual participant pursuant
to a schedule of | 21 | | suggested fees as provided for in the federal Act is not
| 22 | | engaged in the business of selling tangible personal property | 23 | | at retail
with respect to such transactions.
| 24 | | "Purchaser" means anyone who, through a sale at retail, | 25 | | acquires the
ownership of or title to tangible personal | 26 | | property for a valuable
consideration.
|
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| 1 | | "Reseller of motor fuel" means any person engaged in the | 2 | | business of selling
or delivering or transferring title of | 3 | | motor fuel to another person
other than for use or | 4 | | consumption.
No person shall act as a reseller of motor fuel | 5 | | within this State without
first being registered as a reseller | 6 | | pursuant to Section 2c or a retailer
pursuant to Section 2a.
| 7 | | "Selling price" or the "amount of sale" means the | 8 | | consideration for a
sale valued in money whether received in | 9 | | money or otherwise, including
cash, credits, property, other | 10 | | than as hereinafter provided, and services,
but, prior to | 11 | | January 1, 2020 and beginning again on January 1, 2022, not | 12 | | including the value of or credit given for traded-in tangible
| 13 | | personal property where the item that is traded-in is of like | 14 | | kind and
character as that which is being sold; beginning | 15 | | January 1, 2020 and until January 1, 2022, "selling price" | 16 | | includes the portion of the value of or credit given for | 17 | | traded-in motor vehicles of the First Division as defined in | 18 | | Section 1-146 of the Illinois Vehicle Code of like kind and | 19 | | character as that which is being sold that exceeds $10,000. | 20 | | "Selling price" shall be determined without any
deduction on | 21 | | account of the cost of the property sold, the cost of
materials | 22 | | used, labor or service cost or any other expense whatsoever, | 23 | | but
does not include charges that are added to prices by | 24 | | sellers on account of
the seller's tax liability under this | 25 | | Act, or on account of the seller's
duty to collect, from the | 26 | | purchaser, the tax that is imposed by the Use Tax
Act, or, |
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| 1 | | except as otherwise provided with respect to any cigarette tax | 2 | | imposed by a home rule unit, on account of the seller's tax | 3 | | liability under any local occupation tax administered by the | 4 | | Department, or, except as otherwise provided with respect to | 5 | | any cigarette tax imposed by a home rule unit on account of the | 6 | | seller's duty to collect, from the purchasers, the tax that is | 7 | | imposed under any local use tax administered by the | 8 | | Department.
Effective December 1, 1985, "selling price" shall | 9 | | include charges that
are added to prices by sellers on account | 10 | | of the seller's
tax liability under the Cigarette Tax Act, on | 11 | | account of the sellers'
duty to collect, from the purchaser, | 12 | | the tax imposed under the Cigarette
Use Tax Act, and on account | 13 | | of the seller's duty to collect, from the
purchaser, any | 14 | | cigarette tax imposed by a home rule unit.
| 15 | | Notwithstanding any law to the contrary, for any motor | 16 | | vehicle, as defined in Section 1-146 of the Vehicle Code, that | 17 | | is sold on or after January 1, 2015 for the purpose of leasing | 18 | | the vehicle for a defined period that is longer than one year | 19 | | and (1) is a motor vehicle of the second division that: (A) is | 20 | | a self-contained motor vehicle designed or permanently | 21 | | converted to provide living quarters for recreational, | 22 | | camping, or travel use, with direct walk through access to the | 23 | | living quarters from the driver's seat; (B) is of the van | 24 | | configuration designed for the transportation of not less than | 25 | | 7 nor more than 16 passengers; or (C) has a gross vehicle | 26 | | weight rating of 8,000 pounds or less or (2) is a motor vehicle |
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| 1 | | of the first division, "selling price" or "amount of sale" | 2 | | means the consideration received by the lessor pursuant to the | 3 | | lease contract, including amounts due at lease signing and all | 4 | | monthly or other regular payments charged over the term of the | 5 | | lease. Also included in the selling price is any amount | 6 | | received by the lessor from the lessee for the leased vehicle | 7 | | that is not calculated at the time the lease is executed, | 8 | | including, but not limited to, excess mileage charges and | 9 | | charges for excess wear and tear. For sales that occur in | 10 | | Illinois, with respect to any amount received by the lessor | 11 | | from the lessee for the leased vehicle that is not calculated | 12 | | at the time the lease is executed, the lessor who purchased the | 13 | | motor vehicle does not incur the tax imposed by the Use Tax Act | 14 | | on those amounts, and the retailer who makes the retail sale of | 15 | | the motor vehicle to the lessor is not required to collect the | 16 | | tax imposed by the Use Tax Act or to pay the tax imposed by | 17 | | this Act on those amounts. However, the lessor who purchased | 18 | | the motor vehicle assumes the liability for reporting and | 19 | | paying the tax on those amounts directly to the Department in | 20 | | the same form (Illinois Retailers' Occupation Tax, and local | 21 | | retailers' occupation taxes, if applicable) in which the | 22 | | retailer would have reported and paid such tax if the retailer | 23 | | had accounted for the tax to the Department. For amounts | 24 | | received by the lessor from the lessee that are not calculated | 25 | | at the time the lease is executed, the lessor must file the | 26 | | return and pay the tax to the Department by the due date |
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| 1 | | otherwise required by this Act for returns other than | 2 | | transaction returns. If the retailer is entitled under this | 3 | | Act to a discount for collecting and remitting the tax imposed | 4 | | under this Act to the Department with respect to the sale of | 5 | | the motor vehicle to the lessor, then the right to the discount | 6 | | provided in this Act shall be transferred to the lessor with | 7 | | respect to the tax paid by the lessor for any amount received | 8 | | by the lessor from the lessee for the leased vehicle that is | 9 | | not calculated at the time the lease is executed; provided | 10 | | that the discount is only allowed if the return is timely filed | 11 | | and for amounts timely paid. The "selling price" of a motor | 12 | | vehicle that is sold on or after January 1, 2015 for the | 13 | | purpose of leasing for a defined period of longer than one year | 14 | | shall not be reduced by the value of or credit given for | 15 | | traded-in tangible personal property owned by the lessor, nor | 16 | | shall it be reduced by the value of or credit given for | 17 | | traded-in tangible personal property owned by the lessee, | 18 | | regardless of whether the trade-in value thereof is assigned | 19 | | by the lessee to the lessor. In the case of a motor vehicle | 20 | | that is sold for the purpose of leasing for a defined period of | 21 | | longer than one year, the sale occurs at the time of the | 22 | | delivery of the vehicle, regardless of the due date of any | 23 | | lease payments. A lessor who incurs a Retailers' Occupation | 24 | | Tax liability on the sale of a motor vehicle coming off lease | 25 | | may not take a credit against that liability for the Use Tax | 26 | | the lessor paid upon the purchase of the motor vehicle (or for |
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| 1 | | any tax the lessor paid with respect to any amount received by | 2 | | the lessor from the lessee for the leased vehicle that was not | 3 | | calculated at the time the lease was executed) if the selling | 4 | | price of the motor vehicle at the time of purchase was | 5 | | calculated using the definition of "selling price" as defined | 6 | | in this paragraph.
Notwithstanding any other provision of this | 7 | | Act to the contrary, lessors shall file all returns and make | 8 | | all payments required under this paragraph to the Department | 9 | | by electronic means in the manner and form as required by the | 10 | | Department. This paragraph does not apply to leases of motor | 11 | | vehicles for which, at the time the lease is entered into, the | 12 | | term of the lease is not a defined period, including leases | 13 | | with a defined initial period with the option to continue the | 14 | | lease on a month-to-month or other basis beyond the initial | 15 | | defined period. | 16 | | The phrase "like kind and character" shall be liberally | 17 | | construed
(including but not limited to any form of motor | 18 | | vehicle for any form of
motor vehicle, or any kind of farm or | 19 | | agricultural implement for any other
kind of farm or | 20 | | agricultural implement), while not including a kind of item
| 21 | | which, if sold at retail by that retailer, would be exempt from | 22 | | retailers'
occupation tax and use tax as an isolated or | 23 | | occasional sale.
| 24 | | "Gross receipts" from the sales of tangible personal | 25 | | property at retail
means the total selling price or the amount | 26 | | of such sales, as hereinbefore
defined. In the case of charge |
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| 1 | | and time sales, the amount thereof shall be
included only as | 2 | | and when payments are received by the seller.
Receipts or | 3 | | other consideration derived by a seller from
the sale, | 4 | | transfer or assignment of accounts receivable to a wholly | 5 | | owned
subsidiary will not be deemed payments prior to the time | 6 | | the purchaser
makes payment on such accounts.
| 7 | | "Department" means the Department of Revenue.
| 8 | | "Person" means any natural individual, firm, partnership, | 9 | | association,
joint stock company, joint adventure, public or | 10 | | private corporation, limited
liability company, or a receiver, | 11 | | executor, trustee, guardian or other
representative appointed | 12 | | by order of any court.
| 13 | | The isolated or occasional sale of tangible personal | 14 | | property at retail
by a person who does not hold himself out as | 15 | | being engaged (or who does not
habitually engage) in selling | 16 | | such tangible personal property at retail, or
a sale through a | 17 | | bulk vending machine, does not constitute engaging in a
| 18 | | business of selling such tangible personal property at retail | 19 | | within the
meaning of this Act; provided that any person who is | 20 | | engaged in a business
which is not subject to the tax imposed | 21 | | by this Act because of involving
the sale of or a contract to | 22 | | sell real estate or a construction contract to
improve real | 23 | | estate or a construction contract to engineer, install, and
| 24 | | maintain an integrated system of products, but who, in the | 25 | | course of
conducting such business,
transfers tangible | 26 | | personal property to users or consumers in the finished
form |
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| 1 | | in which it was purchased, and which does not become real | 2 | | estate or was
not engineered and installed, under any | 3 | | provision of a construction contract or
real estate sale or | 4 | | real estate sales agreement entered into with some other
| 5 | | person arising out of or because of such nontaxable business, | 6 | | is engaged in the
business of selling tangible personal | 7 | | property at retail to the extent of the
value of the tangible | 8 | | personal property so transferred. If, in such a
transaction, a | 9 | | separate charge is made for the tangible personal property so
| 10 | | transferred, the value of such property, for the purpose of | 11 | | this Act, shall be
the amount so separately charged, but not | 12 | | less than the cost of such property
to the transferor; if no | 13 | | separate charge is made, the value of such property,
for the | 14 | | purposes of this Act, is the cost to the transferor of such | 15 | | tangible
personal property. Construction contracts for the | 16 | | improvement of real estate
consisting of engineering, | 17 | | installation, and maintenance of voice, data, video,
security, | 18 | | and all telecommunication systems do not constitute engaging | 19 | | in a
business of selling tangible personal property at retail | 20 | | within the meaning of
this Act if they are sold at one | 21 | | 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 | 9 | | tangible personal
property upon the redemption of trading | 10 | | stamps are engaged in the business
of selling such property at | 11 | | retail and shall be liable for and shall pay
the tax imposed by | 12 | | this Act on the basis of the retail value of the
property | 13 | | transferred 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 | | "Remote retailer" means a retailer that does not maintain | 21 | | within this State, directly or by a subsidiary, an office, | 22 | | distribution house, sales house, warehouse or other place of | 23 | | business, or any agent or other representative operating | 24 | | within this State under the authority of the retailer or its | 25 | | subsidiary, irrespective of whether such place of business or | 26 | | agent is located here permanently or temporarily or whether |
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| 1 | | such retailer or subsidiary is licensed to do business in this | 2 | | State. | 3 | | "Marketplace" means a physical or electronic place, forum, | 4 | | platform, application, or other method by which a marketplace | 5 | | seller sells or offers to sell items. | 6 | | "Marketplace facilitator" means a person who, pursuant to | 7 | | an agreement with an unrelated third-party marketplace seller, | 8 | | directly or indirectly through one or more affiliates | 9 | | facilitates a retail sale by an unrelated third party | 10 | | marketplace seller by: | 11 | | (1) listing or advertising for sale by the marketplace | 12 | | seller in a marketplace, tangible personal property that | 13 | | is subject to tax under this Act; and | 14 | | (2) either directly or indirectly, through agreements | 15 | | or arrangements with third parties, collecting payment | 16 | | from the customer and transmitting that payment to the | 17 | | marketplace seller regardless of whether the marketplace | 18 | | facilitator receives compensation or other consideration | 19 | | in exchange for its services. | 20 | | A person who provides advertising services, including | 21 | | listing products for sale, is not considered a marketplace | 22 | | facilitator, so long as the advertising service platform or | 23 | | forum does not engage, directly or indirectly through one or | 24 | | more affiliated persons, in the activities described in | 25 | | paragraph (2) of this definition of "marketplace facilitator". | 26 | | "Marketplace facilitator" does not include any person |
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| 1 | | licensed under the Auction License Act. This exemption does | 2 | | not apply to any person who is an Internet auction listing | 3 | | service, as defined by the Auction License Act. | 4 | | "Marketplace seller" means a person that makes sales | 5 | | through a marketplace operated by an unrelated third party | 6 | | marketplace facilitator. | 7 | | As used in Section 2-10, "manufactured home" means a | 8 | | factory-assembled, completely integrated structure designed | 9 | | for permanent habitation that: | 10 | | (1) is designed to be used as a single-family dwelling | 11 | | which complies with the standards established under 42 | 12 | | U.S.C. 70; | 13 | | (2) is transportable in one or more sections; | 14 | | (3) is installed according to the manufacturer's | 15 | | instructions and connected to residential utilities for | 16 | | year-round occupancy; and | 17 | | (4) contains an area of at least 320 square feet. | 18 | | (Source: P.A. 101-31, eff. 6-28-19; 101-604, eff. 1-1-20; | 19 | | 102-353, eff. 1-1-22; 102-634, eff. 8-27-21; 102-813, eff. | 20 | | 5-13-22.)
| 21 | | (35 ILCS 120/2-10)
| 22 | | Sec. 2-10. Rate of tax. Unless otherwise provided in this | 23 | | Section,
the tax imposed by this Act is at the rate of 6.25% of | 24 | | gross receipts
from sales of tangible personal property made | 25 | | in the course of business.
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| 1 | | Beginning on July 1, 2000 and through December 31, 2000, | 2 | | with respect to
motor fuel, as defined in Section 1.1 of the | 3 | | Motor Fuel Tax
Law, and gasohol, as defined in Section 3-40 of | 4 | | the Use Tax Act, the tax is
imposed at the rate of 1.25%.
| 5 | | Beginning on August 6, 2010 through August 15, 2010, and | 6 | | beginning again on August 5, 2022 through August 14, 2022, | 7 | | with respect to sales tax holiday items as defined in Section | 8 | | 2-8 of this Act, the
tax is imposed at the rate of 1.25%. | 9 | | Within 14 days after July 1, 2000 ( the effective date of | 10 | | Public Act 91-872) this amendatory Act of the 91st
General | 11 | | Assembly , each retailer of motor fuel and gasohol shall cause | 12 | | the
following notice to be posted in a prominently visible | 13 | | place on each retail
dispensing device that is used to | 14 | | dispense motor
fuel or gasohol in the State of Illinois: "As of | 15 | | July 1, 2000, the State of
Illinois has eliminated the State's | 16 | | share of sales tax on motor fuel and
gasohol through December | 17 | | 31, 2000. The price on this pump should reflect the
| 18 | | elimination of the tax." The notice shall be printed in bold | 19 | | print on a sign
that is no smaller than 4 inches by 8 inches. | 20 | | The sign shall be clearly
visible to customers. Any retailer | 21 | | who fails to post or maintain a required
sign through December | 22 | | 31, 2000 is guilty of a petty offense for which the fine
shall | 23 | | be $500 per day per each retail premises where a violation | 24 | | occurs.
| 25 | | With respect to gasohol, as defined in the Use Tax Act, the | 26 | | tax imposed
by this Act applies to (i) 70% of the proceeds of |
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| 1 | | sales made on or after
January 1, 1990, and before July 1, | 2 | | 2003, (ii) 80% of the proceeds of
sales made on or after July | 3 | | 1, 2003 and on or before July 1, 2017, and (iii) 100% of the | 4 | | proceeds of sales
made thereafter.
If, at any time, however, | 5 | | the tax under this Act on sales of gasohol, as
defined in
the | 6 | | Use Tax Act, is imposed at the rate of 1.25%, then the
tax | 7 | | imposed by this Act applies to 100% of the proceeds of sales of | 8 | | gasohol
made during that time.
| 9 | | With respect to majority blended ethanol fuel, as defined | 10 | | in the Use Tax Act,
the
tax
imposed by this Act does not apply | 11 | | to the proceeds of sales made on or after
July 1, 2003 and on | 12 | | or before December 31, 2023 but applies to 100% of the
proceeds | 13 | | of sales made thereafter.
| 14 | | With respect to biodiesel blends, as defined in the Use | 15 | | Tax Act, with no less
than 1% and no
more than 10% biodiesel, | 16 | | the tax imposed by this Act
applies to (i) 80% of the proceeds | 17 | | of sales made on or after July 1, 2003
and on or before | 18 | | December 31, 2018 and (ii) 100% of the
proceeds of sales made | 19 | | after December 31, 2018 and before January 1, 2024. On and | 20 | | after January 1, 2024 and on or before December 31, 2030, the | 21 | | taxation of biodiesel, renewable diesel, and biodiesel blends | 22 | | shall be as provided in Section 3-5.1 of the Use Tax Act.
If, | 23 | | at any time, however, the tax under this Act on sales of | 24 | | biodiesel blends,
as
defined in the Use Tax Act, with no less | 25 | | than 1% and no more than 10% biodiesel
is imposed at the rate | 26 | | of 1.25%, then the
tax imposed by this Act applies to 100% of |
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| 1 | | the proceeds of sales of biodiesel
blends with no less than 1% | 2 | | and no more than 10% biodiesel
made
during that time.
| 3 | | With respect to biodiesel, as defined in the Use Tax Act, | 4 | | and biodiesel
blends, as defined in the Use Tax Act, with
more | 5 | | than 10% but no more than 99% biodiesel, the tax imposed by | 6 | | this Act
does not apply to the proceeds of sales made on or | 7 | | after July 1, 2003
and on or before December 31, 2023. On and | 8 | | after January 1, 2024 and on or before December 31, 2030, the | 9 | | taxation of biodiesel, renewable diesel, and biodiesel blends | 10 | | shall be as provided in Section 3-5.1 of the Use Tax Act.
| 11 | | On and after January 1, 2024, with respect to the sale of a | 12 | | manufactured home, as defined in Section 1, if the purchase is | 13 | | the first purchase of the manufactured home for use as a | 14 | | dwelling and the purchaser who will use the home as a dwelling | 15 | | certifies that the manufactured home will be affixed to a | 16 | | permanent foundation in the State so that the manufactured | 17 | | home is deemed to be real property under the Conveyance and | 18 | | Encumbrance of Manufactured Homes as Real Property and | 19 | | Severance Act, then the tax imposed by this Act applies to 50% | 20 | | of the gross receipts from the sale of the manufactured home. | 21 | | The seller, whether acting as a construction contractor or | 22 | | not, must retain the purchaser's certification in his or her | 23 | | books and records for a period of 7 years after the date of the | 24 | | sale. This paragraph is exempt from the provisions of Section | 25 | | 2-70. | 26 | | Until July 1, 2022 and beginning again on July 1, 2023, |
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| 1 | | with respect to food for human consumption that is to be | 2 | | consumed off the
premises where it is sold (other than | 3 | | alcoholic beverages, food consisting of or infused with adult | 4 | | use cannabis, soft drinks, and
food that has been prepared for | 5 | | immediate consumption), the tax is imposed at the rate of 1%. | 6 | | Beginning July 1, 2022 and until July 1, 2023, with respect to | 7 | | food for human consumption that is to be consumed off the | 8 | | premises where it is sold (other than alcoholic beverages, | 9 | | food consisting of or infused with adult use cannabis, soft | 10 | | drinks, and food that has been prepared for immediate | 11 | | consumption), the tax is imposed at the rate of 0%. | 12 | | With respect to prescription and
nonprescription | 13 | | medicines, drugs, medical appliances, products classified as | 14 | | Class III medical devices by the United States Food and Drug | 15 | | Administration that are used for cancer treatment pursuant to | 16 | | a prescription, as well as any accessories and components | 17 | | related to those devices, modifications to a motor
vehicle for | 18 | | the purpose of rendering it usable by a person with a | 19 | | disability, and
insulin, blood sugar testing materials, | 20 | | syringes, and needles used by human diabetics, the tax is | 21 | | imposed at the rate of 1%. For the purposes of this
Section, | 22 | | until September 1, 2009: the term "soft drinks" means any | 23 | | complete, finished, ready-to-use,
non-alcoholic drink, whether | 24 | | carbonated or not, including , but not limited to ,
soda water, | 25 | | cola, fruit juice, vegetable juice, carbonated water, and all | 26 | | other
preparations commonly known as soft drinks of whatever |
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| 1 | | kind or description that
are contained in any closed or sealed | 2 | | bottle, can, carton, or container,
regardless of size; but | 3 | | "soft drinks" does not include coffee, tea, non-carbonated
| 4 | | water, infant formula, milk or milk products as defined in the | 5 | | Grade A
Pasteurized Milk and Milk Products Act, or drinks | 6 | | containing 50% or more
natural fruit or vegetable juice.
| 7 | | Notwithstanding any other provisions of this
Act, | 8 | | beginning September 1, 2009, "soft drinks" means non-alcoholic | 9 | | beverages that contain natural or artificial sweeteners. "Soft | 10 | | drinks" does do not include beverages that contain milk or | 11 | | milk products, soy, rice or similar milk substitutes, or | 12 | | greater than 50% of vegetable or fruit juice by volume. | 13 | | Until August 1, 2009, and notwithstanding any other | 14 | | provisions of this
Act, "food for human consumption that is to | 15 | | be consumed off the premises where
it is sold" includes all | 16 | | food sold through a vending machine, except soft
drinks and | 17 | | food products that are dispensed hot from a vending machine,
| 18 | | regardless of the location of the vending machine. Beginning | 19 | | August 1, 2009, and notwithstanding any other provisions of | 20 | | this Act, "food for human consumption that is to be consumed | 21 | | off the premises where it is sold" includes all food sold | 22 | | through a vending machine, except soft drinks, candy, and food | 23 | | products that are dispensed hot from a vending machine, | 24 | | regardless of the location of the vending machine.
| 25 | | Notwithstanding any other provisions of this
Act, | 26 | | beginning September 1, 2009, "food for human consumption that |
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| 1 | | is to be consumed off the premises where
it is sold" does not | 2 | | include candy. For purposes of this Section, "candy" means a | 3 | | preparation of sugar, honey, or other natural or artificial | 4 | | sweeteners in combination with chocolate, fruits, nuts or | 5 | | other ingredients or flavorings in the form of bars, drops, or | 6 | | pieces. "Candy" does not include any preparation that contains | 7 | | flour or requires refrigeration. | 8 | | Notwithstanding any other provisions of this
Act, | 9 | | beginning September 1, 2009, "nonprescription medicines and | 10 | | drugs" does not include grooming and hygiene products. For | 11 | | purposes of this Section, "grooming and hygiene products" | 12 | | includes, but is not limited to, soaps and cleaning solutions, | 13 | | shampoo, toothpaste, mouthwash, antiperspirants, and sun tan | 14 | | lotions and screens, unless those products are available by | 15 | | prescription only, regardless of whether the products meet the | 16 | | definition of "over-the-counter-drugs". For the purposes of | 17 | | this paragraph, "over-the-counter-drug" means a drug for human | 18 | | use that contains a label that identifies the product as a drug | 19 | | as required by 21 CFR C.F.R. § 201.66. The | 20 | | "over-the-counter-drug" label includes: | 21 | | (A) a A "Drug Facts" panel; or | 22 | | (B) a A statement of the "active ingredient(s)" with a | 23 | | list of those ingredients contained in the compound, | 24 | | substance or preparation.
| 25 | | Beginning on January 1, 2014 ( the effective date of Public | 26 | | Act 98-122) this amendatory Act of the 98th General Assembly , |
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| 1 | | "prescription and nonprescription medicines and drugs" | 2 | | includes medical cannabis purchased from a registered | 3 | | dispensing organization under the Compassionate Use of Medical | 4 | | Cannabis Program Act. | 5 | | As used in this Section, "adult use cannabis" means | 6 | | cannabis subject to tax under the Cannabis Cultivation | 7 | | Privilege Tax Law and the Cannabis Purchaser Excise Tax Law | 8 | | and does not include cannabis subject to tax under the | 9 | | Compassionate Use of Medical Cannabis Program Act. | 10 | | (Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19; | 11 | | 102-4, eff. 4-27-21; 102-700, Article 20, Section 20-20, eff. | 12 | | 4-19-22; 102-700, Article 60, Section 60-30, eff. 4-19-22; | 13 | | 102-700, Article 65, Section 65-10, eff. 4-19-22; revised | 14 | | 6-1-22.)
| 15 | | Section 99. Effective date. This Act takes effect upon | 16 | | becoming law. |
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