Senate Sponsors: WATSON-NOLAND-LUECHTEFELD-O'DANIEL-WEAVER,S, BOWLES, PARKER, JONES,W, MYERS,J, BOMKE, HAWKINSON, SIEBEN, GEO-KARIS, DONAHUE, BURZYNSKI, PETERSON, PETKA, LAUZEN, MADIGAN,R, WALSH,L, O'MALLEY, MAHAR, DILLARD, MITCHELL,N, TROTTER, ROSKAM, WALSH,T, HENDON, DUDYCZ, DEMUZIO, CRONIN, PHILIP, RADOGNO, MAITLAND AND RAUSCHENBERGER. House Sponsors: HOLBROOK-STEPHENS-MCGUIRE-WOOLARD-MYERS,RICHARD Short description: SALES TAX-MOTOR FUEL-GASOHOL Synopsis of Bill as introduced: Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that beginning October 1, 2000, the tax imposed by the Acts on the sale of motor fuel and gasohol shall be at the rate of 1.25% (now, imposed at the rate of 6.25% on everything except certain food, medicines, and medical equipment). Provides for the reversion of the rate to 6.25% if a certain tax revenue growth is not attained. Provides that beginning November 1, 2000, and so long as the rate remains at 1.25%, each month the Department of Revenue shall pay into the County and Mass Transit District Fund 20% and into the Local Government Tax Fund 80% of the net revenue realized for the preceding month from the 1.25% rate on the selling price of motor fuel and gasohol. Reduces from $0.04 to 0.8 cents the amount per gallon of motor fuel and from $0.03 to 0.6 cents the amount per gallon of gasohol that a motor fuel retailer shall prepay to a registered distributor, supplier, or other reseller of motor fuel. Amends the Counties Code, the Illinois Municipal Code, the Salem Civic Center Law of 1997 in the Civic Center Code, the Local Mass Transit District Act, the Regional Transportation Authority Act, and the Water Commission Act of 1985 to provide that a taxing authority (including a home rule unit) that has not imposed a motor fuel tax or a use or occupation tax on the sale, selling price, or use of motor fuel or gasohol before the effective date of this Act shall not impose such a tax on or after that date. Provides that taxing authorities (including a home rule unit) that have imposed a tax on the sale, selling price, or use of motor fuel or gasohol before the effective date of this Act shall not increase the rate of the tax on or after that date. Preempts home rule. Provides that the amendatory provisions in the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act take effect October 1, 2000. Provides that the amendatory provisions in the Counties Code, the Illinois Municipal Code, the Salem Civic Center Law of 1997 in the Civic Center Code, the Local Mass Transit District Act, the Regional Transportation Authority Act, and the Water Commission Act of 1985 take effect immediately. SENATE AMENDMENT NO. 1. Deletes reference to: 35 ILCS 105/3-10 from Ch. 120, par. 439.3-10 35 ILCS 105/9 from Ch. 120, par. 439.9 35 ILCS 110/3-10 from Ch. 120, par. 439.33-10 35 ILCS 110/9 from Ch. 120, par. 439.39 35 ILCS 115/3-10 from Ch. 120, par. 439.103-10 35 ILCS 115/9 from Ch. 120, par. 439.109 35 ILCS 120/2-10 from Ch. 120, par. 441-10 35 ILCS 120/2d from Ch. 120, par. 441d 35 ILCS 120/3 from Ch. 120, par. 442 55 ILCS 5/5-1006 from Ch. 34, par. 5-1006 55 ILCS 5/5-1006.5 55 ILCS 5/5-1007 from Ch. 34, par. 5-1007 55 ILCS 5/5-1035.1 from Ch. 34, par. 5-1035.1 65 ILCS 5/8-11-1 from Ch. 24, par. 8-11-1 65 ILCS 5/8-11-1.1 from Ch. 24, par. 8-11-1.1 65 ILCS 5/8-11-5 from Ch. 24, par. 8-11-5 65 ILCS 5/8-11-6 from Ch. 24, par. 8-11-6 65 ILCS 5/8-11-15 from Ch. 24, par. 8-11-15 70 ILCS 200/245-12 70 ILCS 3610/5.01 from Ch. 111 2/3, par. 355.01 70 ILCS 3615/4.03 from Ch. 111 2/3, par. 704.03 70 ILCS 3720/4 from Ch. 111 2/3, par. 254 Adds reference to: 35 ILCS 120/14 from Ch. 120, par. 453 Deletes everything. Amends the Retailers' Occupation Tax Act. Makes technical changes in a Section concerning the short title. SENATE AMENDMENT NO. 2. Deletes reference to: 35 ILCS 120/14 Adds reference to: 35 ILCS 105/3-10 from Ch. 120, par. 439.3-10 35 ILCS 105/9 from Ch. 120, par. 439.9 35 ILCS 110/3-10 from Ch. 120, par. 439.33-10 35 ILCS 110/9 from Ch. 120, par. 439.39 35 ILCS 115/3-10 from Ch. 120, par. 439.103-10 35 ILCS 115/9 from Ch. 120, par. 439.109 35 ILCS 120/2-10 from Ch. 120, par. 441-10 35 ILCS 120/2d from Ch. 120, par. 441d 35 ILCS 120/3 from Ch. 120, par. 442 35 ILCS 505/13a from Ch. 120, par. 429a 55 ILCS 5/5-1006 from Ch. 34, par. 5-1006 55 ILCS 5/5-1006.5 55 ILCS 5/5-1007 from Ch. 34, par. 5-1007 55 ILCS 5/5-1035.1 from Ch. 34, par. 5-1035.1 65 ILCS 5/8-11-1 from Ch. 24, par. 8-11-1 65 ILCS 5/8-11-1.1 from Ch. 24, par. 8-11-1.1 65 ILCS 5/8-11-5 from Ch. 24, par. 8-11-5 65 ILCS 5/8-11-6 from Ch. 24, par. 8-11-6 65 ILCS 5/8-11-15 from Ch. 24, par. 8-11-15 70 ILCS 200/245-12 70 ILCS 3610/5.01 from Ch. 111 2/3, par. 355.01 70 ILCS 3615/4.03 from Ch. 111 2/3, par. 704.03 70 ILCS 3720/4 from Ch. 111 2/3, par. 254 Deletes everything. Reinserts the provisions of the bill as introduced but makes the following changes: (i) provides that, if the aggregate tax revenues from motor fuel and gasohol under the Motor Fuel Tax Law (now, the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act) during the period from October 1, 2002 (now, 2003) through September 30, 2003 (now, 2004) are not at least 15% more than the aggregate tax revenues from motor fuel and gasohol under that Law (now, those Acts) during the period from October 1, 1999 (now, 2000) through September 30, 2000 (now, 2001), then beginning January 1, 2004 (now, 2005) the tax is imposed on motor fuel and gasohol at the 6.25% general rate, (ii) amends the Motor Fuel Tax Law to provide that the part (b) rate of the tax imposed upon the use of motor fuel upon highways of this State by commercial motor vehicles shall be determined using a 1.25% rate rather than a 6.25% rate and (iii) provides that if, as a result of the provisions of this amendatory Act of the 91st General Assembly, the rate of tax imposed on the sale of motor fuel and gasohol by the Retailers' Occupation Tax Act returns to 6.25%, then the amount of prepayment of the tax required of retailers of motor fuel shall return to the amount under the 6.25% rate, the rate of the tax imposed upon the use of motor fuel upon highways of this State by commercial motor vehicles shall return to 6.25%, and the prohibitions concerning imposing a tax or increasing a tax placed upon local taxing units are no longer in effect. Provides that the Act takes effect immediately, except that the amendatory changes to the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act take effect on October 1, 2000. HOUSE AMENDMENT NO. 1. (Tabled June 28, 2000) Adds reference to: 20 ILCS 105/4.12 new 35 ILCS 5/204 from Ch. 120, par. 2-204 35 ILCS 5/212 new 305 ILCS 5/5-2 from Ch. 23, par. 5-2) 320 ILCS 25/2.5 new 320 ILCS 25/3.02 from Ch. 67 1/2, par. 403.02 320 ILCS 25/3.03 from Ch. 67 1/2, par. 403.03 320 ILCS 25/3.15 from Ch. 67 1/2, par. 403.15 320 ILCS 25/4 from Ch. 67 1/2, par. 404 320 ILCS 25/5 from Ch. 67 1/2, par. 405 320 ILCS 25/13 from Ch. 67 1/2, par. 413 Deletes everything. Amends the Illinois Act on the Aging and the Senior Citizens and Disabled Persons Property Tax Relief and Pharmaceutical Assistance Act. Provides that, beginning on July 1, 2000, the Department on Aging shall be the primary administrator of the Aid to the Aged, Blind and Disabled program and the Circuit Breaker program created by the Senior Citizens and Disabled Persons Property Tax Relief and Pharmaceutical Assistance Act. Provides that the Department on Aging shall determine all policies, promulgate all rules, and perform all intake and case management for these programs. Provides that the Department on Aging may enter into any intergovernmental agreements necessary in the administration of the programs and shall report to the General Assembly with respect to the passage of federal legislation concerning assistance with prescription drugs for senior citizens. Amends the Illinois Income Tax Act. Provides that for taxable years ending on or after December 31, 2000, each taxpayer shall be allowed a basic exemption amount of $3,000 (now, $2,000). Exempts this amendatory change from the sunset require- ments. Creates an earned income tax credit. Provides that each indi- vidual taxpayer is entitled to a credit against the tax imposed by the Act in amount equal to 20% of the federal earned income tax credit allowed. Provides that if the amount of the credit exceeds the tax liability for the year, then the excess credit shall be refunded to the taxpayer. Provides that the Department of Revenue shall calculate the amount of the earned income credit upon the request of a taxpayer. Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, the Motor Fuel Tax Law, the Counties Code, the Illinois Municipal Code, the Civic Center Code, the Local Mass Transit District Act, the Regional Transportation Authority Act, and the Water Commission Act of 1985. Provides that, if the aggregate tax revenues from motor fuel and gasohol under the Motor Fuel Tax Law during the period from October 1, 2002 through September 30, 2003 are not at least 15% more than the aggregate tax revenues from motor fuel and gasohol under that Law during the period from October 1, 1999 through September 30, 2000, then beginning January 1, 2004, the tax is imposed on motor fuel and gasohol at the 6.25% general rate. Amends the Motor Fuel Tax Law to provide that the part (b) rate of the tax imposed upon the use of motor fuel upon highways of this State by commercial motor vehicles shall be determined using a 1.25% rate rather than a 6.25% rate. Provides that if, as a result of the provisions of this amendatory Act of the 91st General Assembly, the rate of tax imposed on the sale of motor fuel and gasohol by the Retailers' Occupation Tax Act returns to 6.25%, then the amount of prepayment of the tax required of retailers of motor fuel shall return to the amount under the 6.25% rate, the rate of the tax imposed upon the use of motor fuel upon highways of this State by commercial motor vehicles shall return to 6.25%, and the prohibitions concerning imposing a tax or increasing a tax placed upon local taxing units are no longer in effect. Makes other changes concerning motor fuel taxes. Amends the Medicaid Article of the Illinois Public Aid Code. Provides for Medicaid eligibility for persons otherwise eligible for Aid to the Aged, Blind, or Disabled program but who fail to qualify for that aid on the basis of need and who meet either of the following requirements: (1) their income is equal to or less than 100% of the federal nonfarm income official poverty line or (ii) their income, after the deduction of costs incurred for medical care and for other types of remedial care, is equal to or less than 100% of the federal nonfarm income offical poverty line. Amends the Senior Citizens and Disabled Persons Property Tax Relief and Pharmaceutical Assistance Act. Provides that, beginning January 1, 2001, cancer, Alzheimer's disease, Parkinson's disease, glaucoma, lung disease, and smoking-related illnesses will be covered under the Act. Authorizes the coverage of brand name drugs in certain cases. Increases the income limitation, beginning with the 2000 grant year, from $16,000 per year to (i) $21,218 for a household containing one person, (ii) $28,480 for a household containing 2 persons, and (iii) $35,740 for a household containing 3 or more persons. Provides that after a beneficiary of the pharmaceutical assistance program receives $2,000 (now, $800) in benefits during a State fiscal year, that beneficiary shall also be charged 20% of the cost of each prescription for which payments are made by the program during the remainder of the fiscal year. Reduces the fee charged for an identification card under the pharmaceutical assistance program and provides that beneficiaries who are below the poverty level shall pay no additional prescription costs per month and those at or above the poverty level shall pay $3 per prescription thereafter (rather than $15 or $25 per month, respectively). Removes a provision that a person is not eligible for pharmaceutical assistance in the calendar year in which he or she turns 65. Provides that eligibility for pharmaceutical assistance shall be determined using the applicant's current income. Makes other changes. Provides that the Act takes effect immediately, except that the amendatory changes to the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act take effect on October 1, 2000. STATE DEBT NOTE, H-AM 1 (Economic and Fiscal Commission) This legislation would not affect the bonding authorization of the State, and therefore, has no direct impact on the level of State indebtedness. BALANCED BUDGET NOTE (Bureau of the Budget) Since SB 1310 is not a supplemental appropriation bill, the Balanced Budget Note Act is inapplicable. STATE MANDATES NOTE, H-AM 1 (Department of Commerce and Community Affairs) This legislation creates a tax exemption mandate for which State reimbursement of the revenue loss to units of local government is required. Due to the nature of the bill, no estimate of the amount of reimbursement required is available. HOME RULE NOTE, H-AM 1 (Department of Commerce and Community Affairs) This legislation amends specific provisions of the statutes to state that the amendments are a denial and a limitation of home rule powers to tax. Home rule units affected are: home rule counties imposing sales taxes; home rule counties imposing the public safety sales tax; home rule municipalities imposing sales taxes; and home rule municipalities, if any, which have imposed motor fuel taxes specifically under the Section of the Municipal Code relating to motor fuel taxes. FISCAL NOTE, H-AM 1 (Department of Revenue) An earned income tax credit will cost the State an estimated $261 million per year. Reducing the sales tax rate on motor fuel to 1.25% will cost approximately $335 million per year, using average pump prices for 1999. Increasing the basic exemp- tion to $3000 will cost the State an estimated $322 million per year. The total fiscal impact related to the taxes and programs administered by the Department of Revenue is estimated to be almost $1 billion. The cost of the proposed changes to the Circuit Breaker and Pharmaceutical Assistance Program are in- determinable by the Department. HOUSE AMENDMENT NO. 2. Adds reference to: 30 ILCS 105/6z-18 from Ch. 127, par. 142z-18 30 ILCS 105/6z-20 from Ch. 127, par. 142z-20 Deletes everything. Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that beginning July 1, 2000 and through December 31, 2000, the tax with respect to motor fuel and gasohol is imposed under these Acts at the rate of 1.25% (eliminating the State's portion of the tax). Requires retailers to post a notice on pumps that the State's share of tax has been eliminated through December 31, 2000 and imposes a fine of $500 per day per each retail premises where a violation occurs. Reduces for the same period from $0.04 to $0.01 the amount per gallon of motor fuel and from $0.03 to $0.01 the amount per gallon of gasohol that a motor fuel retailer shall prepay in taxes to a registered distributor, supplier, or other reseller of motor fuel. Amends the State Finance Act to provide for the distribution of the 1.25% tax on motor fuel and gasohol. Amends the Motor Fuel Tax Law to provide that the part (b) rate of the tax imposed upon the use of motor fuel upon highways of this State by commercial motor vehicles shall be determined using a 1.25% rate rather than a 6.25% rate from July 1, 2000 through December 31, 2000. Effective July 1, 2000. Last action on Bill: PUBLIC ACT.............................. 91-0872 Last action date: 00-06-29 Location: Senate Amendments to Bill: AMENDMENTS ADOPTED: HOUSE - 1 SENATE - 2 END OF INQUIRY Full Text Bill Status