State of Illinois
92nd General Assembly
Legislation

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92_HB2950

 
                                               LRB9204480SMdv

 1        AN ACT regarding taxes.

 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
 5    Section 3-5 as follows:

 6        (35 ILCS 105/3-5) (from Ch. 120, par. 439.3-5)
 7        Sec.  3-5.   Exemptions.   Use  of the following tangible
 8    personal property is exempt from the tax imposed by this Act:
 9        (1)  Personal  property  purchased  from  a  corporation,
10    society,    association,    foundation,    institution,    or
11    organization, other than a limited liability company, that is
12    organized and operated as a not-for-profit service enterprise
13    for the benefit of persons 65 years of age or  older  if  the
14    personal property was not purchased by the enterprise for the
15    purpose of resale by the enterprise.
16        (2)  Personal  property  purchased  by  a  not-for-profit
17    Illinois  county  fair  association  for  use  in conducting,
18    operating, or promoting the county fair.
19        (3)  Personal property purchased by a not-for-profit arts
20    or cultural organization that establishes, by proof  required
21    by  the Department by rule, that it has received an exemption
22    under Section 501(c)(3) of the Internal Revenue Code and that
23    is organized and operated for the presentation or support  of
24    arts or cultural programming, activities, or services.  These
25    organizations  include,  but  are  not  limited to, music and
26    dramatic arts organizations such as symphony  orchestras  and
27    theatrical  groups,  arts and cultural service organizations,
28    local arts councils, visual  arts  organizations,  and  media
29    arts organizations.
30        (4)  Personal  property purchased by a governmental body,
31    by  a  corporation,  society,  association,  foundation,   or
 
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 1    institution    organized   and   operated   exclusively   for
 2    charitable, religious,  or  educational  purposes,  or  by  a
 3    not-for-profit corporation, society, association, foundation,
 4    institution, or organization that has no compensated officers
 5    or employees and that is organized and operated primarily for
 6    the recreation of persons 55 years of age or older. A limited
 7    liability  company  may  qualify for the exemption under this
 8    paragraph only if the limited liability company is  organized
 9    and  operated  exclusively  for  educational purposes. On and
10    after July 1, 1987, however, no entity otherwise eligible for
11    this exemption shall make tax-free purchases unless it has an
12    active  exemption  identification  number   issued   by   the
13    Department.
14        (5)  A passenger car that is a replacement vehicle to the
15    extent  that  the purchase price of the car is subject to the
16    Replacement Vehicle Tax.
17        (6)  Graphic  arts  machinery  and  equipment,  including
18    repair  and  replacement  parts,  both  new  and  used,   and
19    including  that  manufactured  on special order, certified by
20    the  purchaser  to  be  used  primarily  for   graphic   arts
21    production,  and  including machinery and equipment purchased
22    for lease.
23        (7)  Farm chemicals.
24        (8)  Legal  tender,  currency,  medallions,  or  gold  or
25    silver  coinage  issued  by  the  State  of   Illinois,   the
26    government of the United States of America, or the government
27    of any foreign country, and bullion.
28        (9)  Personal property purchased from a teacher-sponsored
29    student   organization   affiliated  with  an  elementary  or
30    secondary school located in Illinois.
31        (10)  A motor vehicle of  the  first  division,  a  motor
32    vehicle of the second division that is a self-contained motor
33    vehicle  designed  or permanently converted to provide living
34    quarters for  recreational,  camping,  or  travel  use,  with
 
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 1    direct  walk through to the living quarters from the driver's
 2    seat, or a motor vehicle of the second division  that  is  of
 3    the  van configuration designed for the transportation of not
 4    less than 7 nor  more  than  16  passengers,  as  defined  in
 5    Section  1-146 of the Illinois Vehicle Code, that is used for
 6    automobile renting, as  defined  in  the  Automobile  Renting
 7    Occupation and Use Tax Act.
 8        (11)  Farm  machinery  and  equipment, both new and used,
 9    including that manufactured on special  order,  certified  by
10    the purchaser to be used primarily for production agriculture
11    or   State   or   federal  agricultural  programs,  including
12    individual replacement parts for the machinery and equipment,
13    including machinery and equipment purchased  for  lease,  and
14    including implements of husbandry defined in Section 1-130 of
15    the  Illinois  Vehicle  Code, farm machinery and agricultural
16    chemical and fertilizer spreaders, and nurse wagons  required
17    to  be registered under Section 3-809 of the Illinois Vehicle
18    Code, but excluding  other  motor  vehicles  required  to  be
19    registered  under  the  Illinois  Vehicle Code. Horticultural
20    polyhouses or hoop houses used for propagating,  growing,  or
21    overwintering  plants  shall be considered farm machinery and
22    equipment under this item (11). Agricultural chemical  tender
23    tanks  and dry boxes shall include units sold separately from
24    a motor vehicle  required  to  be  licensed  and  units  sold
25    mounted  on  a  motor  vehicle required to be licensed if the
26    selling price of the tender is separately stated.
27        Farm machinery  and  equipment  shall  include  precision
28    farming  equipment  that  is  installed  or  purchased  to be
29    installed on farm machinery and equipment including, but  not
30    limited   to,   tractors,   harvesters,  sprayers,  planters,
31    seeders, or spreaders. Precision farming equipment  includes,
32    but  is  not  limited  to,  soil  testing sensors, computers,
33    monitors, software, global positioning and  mapping  systems,
34    and other such equipment.
 
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 1        Farm  machinery  and  equipment  also includes computers,
 2    sensors, software, and related equipment  used  primarily  in
 3    the  computer-assisted  operation  of  production agriculture
 4    facilities,  equipment,  and  activities  such  as,  but  not
 5    limited to, the collection, monitoring,  and  correlation  of
 6    animal  and  crop  data for the purpose of formulating animal
 7    diets and agricultural chemicals.  This item (11)  is  exempt
 8    from the provisions of Section 3-90.
 9        (12)  Fuel  and  petroleum products sold to or used by an
10    air common carrier, certified by the carrier to be  used  for
11    consumption,  shipment,  or  storage  in  the  conduct of its
12    business as an air common carrier, for a flight destined  for
13    or  returning from a location or locations outside the United
14    States without regard  to  previous  or  subsequent  domestic
15    stopovers.
16        (13)  Proceeds  of  mandatory  service charges separately
17    stated on customers' bills for the purchase  and  consumption
18    of food and beverages purchased at retail from a retailer, to
19    the  extent  that  the  proceeds of the service charge are in
20    fact turned over as tips or as a substitute for tips  to  the
21    employees  who  participate  directly  in preparing, serving,
22    hosting or cleaning up the food  or  beverage  function  with
23    respect to which the service charge is imposed.
24        (14)  Oil  field  exploration,  drilling,  and production
25    equipment, including (i) rigs and parts of rigs, rotary rigs,
26    cable tool rigs, and workover rigs,  (ii)  pipe  and  tubular
27    goods,  including  casing  and drill strings, (iii) pumps and
28    pump-jack units, (iv) storage tanks and flow lines,  (v)  any
29    individual   replacement  part  for  oil  field  exploration,
30    drilling, and production equipment, and  (vi)  machinery  and
31    equipment  purchased  for lease; but excluding motor vehicles
32    required to be registered under the Illinois Vehicle Code.
33        (15)  Photoprocessing machinery and equipment,  including
34    repair  and  replacement  parts, both new and used, including
 
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 1    that  manufactured  on  special  order,  certified   by   the
 2    purchaser  to  be  used  primarily  for  photoprocessing, and
 3    including photoprocessing machinery and  equipment  purchased
 4    for lease.
 5        (16)  Coal   exploration,   mining,  offhighway  hauling,
 6    processing, maintenance, and reclamation equipment, including
 7    replacement parts  and  equipment,  and  including  equipment
 8    purchased for lease, but excluding motor vehicles required to
 9    be registered under the Illinois Vehicle Code.
10        (17)  Distillation  machinery  and  equipment,  sold as a
11    unit  or  kit,  assembled  or  installed  by  the   retailer,
12    certified  by  the user to be used only for the production of
13    ethyl alcohol that will be used for consumption as motor fuel
14    or as a component of motor fuel for the personal use  of  the
15    user, and not subject to sale or resale.
16        (18)  Manufacturing    and   assembling   machinery   and
17    equipment used primarily in the process of  manufacturing  or
18    assembling tangible personal property for wholesale or retail
19    sale or lease, whether that sale or lease is made directly by
20    the  manufacturer  or  by  some  other  person,  whether  the
21    materials  used  in the process are owned by the manufacturer
22    or some other person, or whether that sale or lease  is  made
23    apart  from or as an incident to the seller's engaging in the
24    service occupation of producing machines, tools, dies,  jigs,
25    patterns,  gauges,  or  other  similar items of no commercial
26    value on special order for a particular purchaser.
27        (19)  Personal  property  delivered  to  a  purchaser  or
28    purchaser's donee inside Illinois when the purchase order for
29    that personal property was  received  by  a  florist  located
30    outside  Illinois  who  has a florist located inside Illinois
31    deliver the personal property.
32        (20)  Semen used for artificial insemination of livestock
33    for direct agricultural production.
34        (21)  Horses, or interests in horses, registered with and
 
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 1    meeting the requirements of any of  the  Arabian  Horse  Club
 2    Registry  of  America, Appaloosa Horse Club, American Quarter
 3    Horse Association, United  States  Trotting  Association,  or
 4    Jockey Club, as appropriate, used for purposes of breeding or
 5    racing for prizes.
 6        (22)  Computers and communications equipment utilized for
 7    any  hospital  purpose  and  equipment used in the diagnosis,
 8    analysis, or treatment of hospital patients  purchased  by  a
 9    lessor who leases the equipment, under a lease of one year or
10    longer  executed  or  in  effect at the time the lessor would
11    otherwise be subject to the tax imposed by  this  Act,  to  a
12    hospital    that  has  been  issued  an  active tax exemption
13    identification number by the Department under Section  1g  of
14    the  Retailers'  Occupation  Tax  Act.   If  the equipment is
15    leased in a manner that does not qualify for  this  exemption
16    or  is  used in any other non-exempt manner, the lessor shall
17    be liable for the tax imposed under this Act or  the  Service
18    Use  Tax  Act,  as  the case may be, based on the fair market
19    value of the property at  the  time  the  non-qualifying  use
20    occurs.   No  lessor  shall  collect or attempt to collect an
21    amount (however designated) that purports to  reimburse  that
22    lessor for the tax imposed by this Act or the Service Use Tax
23    Act,  as the case may be, if the tax has not been paid by the
24    lessor.  If a lessor improperly collects any such amount from
25    the lessee, the lessee shall have a legal right  to  claim  a
26    refund  of  that  amount  from the lessor.  If, however, that
27    amount is not refunded to the  lessee  for  any  reason,  the
28    lessor is liable to pay that amount to the Department.
29        (23)  Personal  property purchased by a lessor who leases
30    the property, under a lease of  one year or  longer  executed
31    or  in  effect  at  the  time  the  lessor would otherwise be
32    subject to the tax imposed by this  Act,  to  a  governmental
33    body  that  has  been  issued  an  active sales tax exemption
34    identification number by the Department under Section  1g  of
 
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 1    the  Retailers' Occupation Tax Act. If the property is leased
 2    in a manner that does not qualify for this exemption or  used
 3    in  any  other  non-exempt manner, the lessor shall be liable
 4    for the tax imposed under this Act or  the  Service  Use  Tax
 5    Act,  as  the  case may be, based on the fair market value of
 6    the property at the time the non-qualifying use  occurs.   No
 7    lessor shall collect or attempt to collect an amount (however
 8    designated)  that  purports  to reimburse that lessor for the
 9    tax imposed by this Act or the Service Use Tax  Act,  as  the
10    case  may be, if the tax has not been paid by the lessor.  If
11    a lessor improperly collects any such amount from the lessee,
12    the lessee shall have a legal right to claim a refund of that
13    amount from the lessor.  If,  however,  that  amount  is  not
14    refunded  to  the lessee for any reason, the lessor is liable
15    to pay that amount to the Department.
16        (24)  Beginning with taxable years  ending  on  or  after
17    December  31, 1995 and ending with taxable years ending on or
18    before December 31, 2004, personal property that  is  donated
19    for  disaster  relief  to  be  used  in  a State or federally
20    declared disaster area in Illinois or bordering Illinois by a
21    manufacturer or retailer that is registered in this State  to
22    a   corporation,   society,   association,   foundation,   or
23    institution  that  has  been  issued  a  sales  tax exemption
24    identification number by the Department that assists  victims
25    of the disaster who reside within the declared disaster area.
26        (25)  Beginning  with  taxable  years  ending on or after
27    December 31, 1995 and ending with taxable years ending on  or
28    before  December  31, 2004, personal property that is used in
29    the performance of  infrastructure  repairs  in  this  State,
30    including  but  not  limited  to municipal roads and streets,
31    access roads, bridges,  sidewalks,  waste  disposal  systems,
32    water  and  sewer  line  extensions,  water  distribution and
33    purification facilities, storm water drainage  and  retention
34    facilities, and sewage treatment facilities, resulting from a
 
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 1    State or federally declared disaster in Illinois or bordering
 2    Illinois  when  such  repairs  are  initiated  on  facilities
 3    located  in  the declared disaster area within 6 months after
 4    the disaster.
 5        (26)  Beginning  July  1,  1999,  game  or   game   birds
 6    purchased  at  a "game breeding and hunting preserve area" or
 7    an "exotic game hunting area" as those terms are used in  the
 8    Wildlife  Code  or  at  a  hunting enclosure approved through
 9    rules adopted by the Department of Natural  Resources.   This
10    paragraph is exempt from the provisions of Section 3-90.
11        (27)  A motor vehicle, as that term is defined in Section
12    1-146  of  the  Illinois  Vehicle  Code, that is donated to a
13    corporation, limited liability company, society, association,
14    foundation,  or  institution  that  is  determined   by   the
15    Department  to  be  organized  and  operated  exclusively for
16    educational purposes.  For purposes  of  this  exemption,  "a
17    corporation, limited liability company, society, association,
18    foundation, or institution organized and operated exclusively
19    for  educational  purposes"  means  all  tax-supported public
20    schools, private schools that offer systematic instruction in
21    useful branches of  learning  by  methods  common  to  public
22    schools  and  that  compare  favorably  in  their  scope  and
23    intensity with the course of study presented in tax-supported
24    schools,  and  vocational  or technical schools or institutes
25    organized and operated exclusively to  provide  a  course  of
26    study  of  not  less  than  6  weeks duration and designed to
27    prepare individuals to follow a trade or to pursue a  manual,
28    technical,  mechanical,  industrial,  business, or commercial
29    occupation.
30        (28)  Beginning  January  1,  2000,   personal  property,
31    including food, purchased through fundraising events for  the
32    benefit  of  a  public  or  private  elementary  or secondary
33    school, a group of those  schools,  or  one  or  more  school
34    districts if the events are sponsored by an entity recognized
 
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 1    by  the school district that consists primarily of volunteers
 2    and includes parents and teachers  of  the  school  children.
 3    This  paragraph  does not apply to fundraising events (i) for
 4    the benefit of private home instruction or (ii) for which the
 5    fundraising entity purchases the personal  property  sold  at
 6    the  events  from  another individual or entity that sold the
 7    property for the purpose of resale by the fundraising  entity
 8    and  that  profits  from  the sale to the fundraising entity.
 9    This paragraph is exempt from the provisions of Section 3-90.
10        (29)  Beginning January 1, 2000, new  or  used  automatic
11    vending   machines  that  prepare  and  serve  hot  food  and
12    beverages, including  coffee,  soup,  and  other  items,  and
13    replacement  parts  for  these  machines.   This paragraph is
14    exempt from the provisions of Section 3-90.
15        (30)  Food for human consumption that is to  be  consumed
16    off  the  premises  where  it  is  sold (other than alcoholic
17    beverages, soft drinks, and food that has been  prepared  for
18    immediate  consumption)  and prescription and nonprescription
19    medicines, drugs,  medical  appliances,  and  insulin,  urine
20    testing  materials,  syringes, and needles used by diabetics,
21    for human use, when purchased for use by a  person  receiving
22    medical assistance under Article 5 of the Illinois Public Aid
23    Code  who  resides  in a licensed long-term care facility, as
24    defined in the Nursing Home Care Act.
25        (31)  Beginning January 1, 2002, gasohol, as  defined  in
26    Section   3-40.  This  paragraph  (31)  is  exempt  from  the
27    provisions of Section 3-90.
28    (Source: P.A. 90-14,  eff.  7-1-97;  90-552,  eff.  12-12-97;
29    90-605,  eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200, eff.
30    7-20-99; 91-439, eff. 8-6-99; 91-637, eff.  8-20-99;  91-644,
31    eff. 8-20-99; 91-901, eff. 1-1-01.)

32        (35 ILCS 105/3-10) (from Ch. 120, par. 439.3-10)
33        Sec.  3-10.   Rate  of tax.  Unless otherwise provided in
 
                            -10-               LRB9204480SMdv
 1    this Section, the tax imposed by this Act is at the  rate  of
 2    6.25%  of  either the selling price or the fair market value,
 3    if any, of the tangible  personal  property.   In  all  cases
 4    where  property  functionally used or consumed is the same as
 5    the property that was purchased at retail, then  the  tax  is
 6    imposed  on  the selling price of the property.  In all cases
 7    where property functionally used or consumed is a  by-product
 8    or  waste  product  that  has  been refined, manufactured, or
 9    produced from property purchased at retail, then the  tax  is
10    imposed on the lower of the fair market value, if any, of the
11    specific  property  so  used  in this State or on the selling
12    price of the property purchased at retail.  For  purposes  of
13    this  Section  "fair  market  value" means the price at which
14    property would change hands between a  willing  buyer  and  a
15    willing  seller, neither being under any compulsion to buy or
16    sell and both having reasonable  knowledge  of  the  relevant
17    facts. The fair market value shall be established by Illinois
18    sales   by   the  taxpayer  of  the  same  property  as  that
19    functionally used or consumed, or if there are no such  sales
20    by  the  taxpayer,  then  comparable  sales  or  purchases of
21    property of like kind and character in Illinois.
22        Beginning on July 1, 2000 and through December 31,  2000,
23    with  respect to motor fuel, as defined in Section 1.1 of the
24    Motor Fuel Tax Law, and gasohol, as defined in  Section  3-40
25    of the Use Tax Act, the tax is imposed at the rate of 1.25%.
26        With  respect  to  gasohol,  the  tax imposed by this Act
27    applies to 70% of the proceeds of  sales  made  on  or  after
28    January 1, 1990, and before January 1, 2002 July 1, 2003, and
29    to 100% of the proceeds of sales made thereafter.
30        With  respect to food for human consumption that is to be
31    consumed off the  premises  where  it  is  sold  (other  than
32    alcoholic  beverages,  soft  drinks,  and  food that has been
33    prepared for  immediate  consumption)  and  prescription  and
34    nonprescription   medicines,   drugs,   medical   appliances,
 
                            -11-               LRB9204480SMdv
 1    modifications to a motor vehicle for the purpose of rendering
 2    it  usable  by  a disabled person, and insulin, urine testing
 3    materials, syringes, and needles used by diabetics, for human
 4    use, the tax is imposed at the rate of 1%. For  the  purposes
 5    of  this  Section, the term "soft drinks" means any complete,
 6    finished,   ready-to-use,   non-alcoholic   drink,    whether
 7    carbonated  or  not, including but not limited to soda water,
 8    cola, fruit juice, vegetable juice, carbonated water, and all
 9    other preparations commonly known as soft drinks of  whatever
10    kind  or  description  that  are  contained  in any closed or
11    sealed bottle, can, carton, or container, regardless of size.
12    "Soft drinks" does not include  coffee,  tea,  non-carbonated
13    water,  infant  formula,  milk or milk products as defined in
14    the Grade A Pasteurized Milk and Milk Products Act, or drinks
15    containing 50% or more natural fruit or vegetable juice.
16        Notwithstanding any other provisions of this  Act,  "food
17    for human consumption that is to be consumed off the premises
18    where  it  is  sold" includes all food sold through a vending
19    machine, except  soft  drinks  and  food  products  that  are
20    dispensed  hot  from  a  vending  machine,  regardless of the
21    location of the vending machine.
22        If the property  that  is  purchased  at  retail  from  a
23    retailer  is  acquired  outside  Illinois  and  used  outside
24    Illinois before being brought to Illinois for use here and is
25    taxable  under this Act, the "selling price" on which the tax
26    is computed shall be reduced by an amount that  represents  a
27    reasonable allowance for depreciation for the period of prior
28    out-of-state use.
29    (Source:  P.A.  90-605,  eff.  6-30-98; 90-606, eff. 6-30-98;
30    91-51, eff. 6-30-99; 91-872, eff. 7-1-00.)

31        Section 10.  The  Service  Use  Tax  Act  is  amended  by
32    changing Sections 3-5 and 3-10 as follows;
 
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 1        (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
 2        Sec.  3-5.   Exemptions.   Use  of the following tangible
 3    personal property is exempt from the tax imposed by this Act:
 4        (1)  Personal  property  purchased  from  a  corporation,
 5    society,    association,    foundation,    institution,    or
 6    organization, other than a limited liability company, that is
 7    organized and operated as a not-for-profit service enterprise
 8    for the benefit of persons 65 years of age or  older  if  the
 9    personal property was not purchased by the enterprise for the
10    purpose of resale by the enterprise.
11        (2)  Personal property purchased by a non-profit Illinois
12    county  fair association for use in conducting, operating, or
13    promoting the county fair.
14        (3)  Personal property purchased by a not-for-profit arts
15    or cultural organization that establishes, by proof  required
16    by  the Department by rule, that it has received an exemption
17    under Section 501(c)(3) of the Internal Revenue Code and that
18    is organized and operated for the presentation or support  of
19    arts or cultural programming, activities, or services.  These
20    organizations  include,  but  are  not  limited to, music and
21    dramatic arts organizations such as symphony  orchestras  and
22    theatrical  groups,  arts and cultural service organizations,
23    local arts councils, visual  arts  organizations,  and  media
24    arts organizations.
25        (4)  Legal  tender,  currency,  medallions,  or  gold  or
26    silver   coinage   issued  by  the  State  of  Illinois,  the
27    government of the United States of America, or the government
28    of any foreign country, and bullion.
29        (5)  Graphic  arts  machinery  and  equipment,  including
30    repair  and  replacement  parts,  both  new  and  used,   and
31    including that manufactured on special order or purchased for
32    lease,  certified  by  the purchaser to be used primarily for
33    graphic arts production.
34        (6)  Personal property purchased from a teacher-sponsored
 
                            -13-               LRB9204480SMdv
 1    student  organization  affiliated  with  an   elementary   or
 2    secondary school located in Illinois.
 3        (7)  Farm  machinery  and  equipment,  both new and used,
 4    including that manufactured on special  order,  certified  by
 5    the purchaser to be used primarily for production agriculture
 6    or   State   or   federal  agricultural  programs,  including
 7    individual replacement parts for the machinery and equipment,
 8    including machinery and equipment purchased  for  lease,  and
 9    including implements of husbandry defined in Section 1-130 of
10    the  Illinois  Vehicle  Code, farm machinery and agricultural
11    chemical and fertilizer spreaders, and nurse wagons  required
12    to  be registered under Section 3-809 of the Illinois Vehicle
13    Code, but excluding  other  motor  vehicles  required  to  be
14    registered  under  the  Illinois  Vehicle Code. Horticultural
15    polyhouses or hoop houses used for propagating,  growing,  or
16    overwintering  plants  shall be considered farm machinery and
17    equipment under this item (7). Agricultural  chemical  tender
18    tanks  and dry boxes shall include units sold separately from
19    a motor vehicle  required  to  be  licensed  and  units  sold
20    mounted  on  a  motor  vehicle required to be licensed if the
21    selling price of the tender is separately stated.
22        Farm machinery  and  equipment  shall  include  precision
23    farming  equipment  that  is  installed  or  purchased  to be
24    installed on farm machinery and equipment including, but  not
25    limited   to,   tractors,   harvesters,  sprayers,  planters,
26    seeders, or spreaders. Precision farming equipment  includes,
27    but  is  not  limited  to,  soil  testing sensors, computers,
28    monitors, software, global positioning and  mapping  systems,
29    and other such equipment.
30        Farm  machinery  and  equipment  also includes computers,
31    sensors, software, and related equipment  used  primarily  in
32    the  computer-assisted  operation  of  production agriculture
33    facilities,  equipment,  and  activities  such  as,  but  not
34    limited to, the collection, monitoring,  and  correlation  of
 
                            -14-               LRB9204480SMdv
 1    animal  and  crop  data for the purpose of formulating animal
 2    diets and agricultural chemicals.  This item  (7)  is  exempt
 3    from the provisions of Section 3-75.
 4        (8)  Fuel  and  petroleum  products sold to or used by an
 5    air common carrier, certified by the carrier to be  used  for
 6    consumption,  shipment,  or  storage  in  the  conduct of its
 7    business as an air common carrier, for a flight destined  for
 8    or  returning from a location or locations outside the United
 9    States without regard  to  previous  or  subsequent  domestic
10    stopovers.
11        (9)  Proceeds  of  mandatory  service  charges separately
12    stated on customers' bills for the purchase  and  consumption
13    of food and beverages acquired as an incident to the purchase
14    of  a  service  from  a  serviceman,  to  the extent that the
15    proceeds of the service charge are in  fact  turned  over  as
16    tips  or  as  a  substitute  for  tips  to  the employees who
17    participate  directly  in  preparing,  serving,  hosting   or
18    cleaning  up  the  food  or beverage function with respect to
19    which the service charge is imposed.
20        (10)  Oil field  exploration,  drilling,  and  production
21    equipment, including (i) rigs and parts of rigs, rotary rigs,
22    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
23    goods, including casing and drill strings,  (iii)  pumps  and
24    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
25    individual  replacement  part  for  oil  field   exploration,
26    drilling,  and  production  equipment, and (vi) machinery and
27    equipment purchased for lease; but excluding  motor  vehicles
28    required to be registered under the Illinois Vehicle Code.
29        (11)  Proceeds from the sale of photoprocessing machinery
30    and  equipment,  including repair and replacement parts, both
31    new and used, including that manufactured on  special  order,
32    certified   by   the  purchaser  to  be  used  primarily  for
33    photoprocessing, and including photoprocessing machinery  and
34    equipment purchased for lease.
 
                            -15-               LRB9204480SMdv
 1        (12)  Coal   exploration,   mining,  offhighway  hauling,
 2    processing, maintenance, and reclamation equipment, including
 3    replacement parts  and  equipment,  and  including  equipment
 4    purchased for lease, but excluding motor vehicles required to
 5    be registered under the Illinois Vehicle Code.
 6        (13)  Semen used for artificial insemination of livestock
 7    for direct agricultural production.
 8        (14)  Horses, or interests in horses, registered with and
 9    meeting  the  requirements  of  any of the Arabian Horse Club
10    Registry of America, Appaloosa Horse Club,  American  Quarter
11    Horse  Association,  United  States  Trotting Association, or
12    Jockey Club, as appropriate, used for purposes of breeding or
13    racing for prizes.
14        (15)  Computers and communications equipment utilized for
15    any hospital purpose and equipment  used  in  the  diagnosis,
16    analysis,  or  treatment  of hospital patients purchased by a
17    lessor who leases the equipment, under a lease of one year or
18    longer executed or in effect at the  time  the  lessor  would
19    otherwise  be  subject  to  the tax imposed by this Act, to a
20    hospital  that  has  been  issued  an  active  tax  exemption
21    identification number by the Department under Section  1g  of
22    the Retailers' Occupation Tax Act. If the equipment is leased
23    in  a  manner  that does not qualify for this exemption or is
24    used in any other non-exempt  manner,  the  lessor  shall  be
25    liable for the tax imposed under this Act or the Use Tax Act,
26    as  the  case  may  be, based on the fair market value of the
27    property at the  time  the  non-qualifying  use  occurs.   No
28    lessor shall collect or attempt to collect an amount (however
29    designated)  that  purports  to reimburse that lessor for the
30    tax imposed by this Act or the Use Tax Act, as the  case  may
31    be,  if the tax has not been paid by the lessor.  If a lessor
32    improperly collects any such  amount  from  the  lessee,  the
33    lessee  shall  have  a  legal right to claim a refund of that
34    amount from the lessor.  If,  however,  that  amount  is  not
 
                            -16-               LRB9204480SMdv
 1    refunded  to  the lessee for any reason, the lessor is liable
 2    to pay that amount to the Department.
 3        (16)  Personal property purchased by a lessor who  leases
 4    the property, under a lease of one year or longer executed or
 5    in  effect  at the time the lessor would otherwise be subject
 6    to the tax imposed by this Act, to a governmental  body  that
 7    has been issued an active tax exemption identification number
 8    by   the  Department  under  Section  1g  of  the  Retailers'
 9    Occupation Tax Act.  If the property is leased  in  a  manner
10    that  does  not  qualify for this exemption or is used in any
11    other non-exempt manner, the lessor shall be liable  for  the
12    tax  imposed  under  this Act or the Use Tax Act, as the case
13    may be, based on the fair market value of the property at the
14    time the non-qualifying use occurs.  No lessor shall  collect
15    or  attempt  to  collect  an amount (however designated) that
16    purports to reimburse that lessor for the tax imposed by this
17    Act or the Use Tax Act, as the case may be, if  the  tax  has
18    not been paid by the lessor.  If a lessor improperly collects
19    any  such  amount  from  the  lessee, the lessee shall have a
20    legal right to claim a refund of that amount from the lessor.
21    If, however, that amount is not refunded to  the  lessee  for
22    any  reason,  the  lessor is liable to pay that amount to the
23    Department.
24        (17)  Beginning with taxable years  ending  on  or  after
25    December  31, 1995 and ending with taxable years ending on or
26    before December 31, 2004, personal property that  is  donated
27    for  disaster  relief  to  be  used  in  a State or federally
28    declared disaster area in Illinois or bordering Illinois by a
29    manufacturer or retailer that is registered in this State  to
30    a   corporation,   society,   association,   foundation,   or
31    institution  that  has  been  issued  a  sales  tax exemption
32    identification number by the Department that assists  victims
33    of the disaster who reside within the declared disaster area.
34        (18)  Beginning  with  taxable  years  ending on or after
 
                            -17-               LRB9204480SMdv
 1    December 31, 1995 and ending with taxable years ending on  or
 2    before  December  31, 2004, personal property that is used in
 3    the performance of  infrastructure  repairs  in  this  State,
 4    including  but  not  limited  to municipal roads and streets,
 5    access roads, bridges,  sidewalks,  waste  disposal  systems,
 6    water  and  sewer  line  extensions,  water  distribution and
 7    purification facilities, storm water drainage  and  retention
 8    facilities, and sewage treatment facilities, resulting from a
 9    State or federally declared disaster in Illinois or bordering
10    Illinois  when  such  repairs  are  initiated  on  facilities
11    located  in  the declared disaster area within 6 months after
12    the disaster.
13        (19)  Beginning  July  1,  1999,  game  or   game   birds
14    purchased  at  a "game breeding and hunting preserve area" or
15    an "exotic game hunting area" as those terms are used in  the
16    Wildlife  Code  or  at  a  hunting enclosure approved through
17    rules adopted by the Department of Natural  Resources.   This
18    paragraph is exempt from the provisions of Section 3-75.
19        (20)  (19)  A  motor  vehicle, as that term is defined in
20    Section 1-146 of the Illinois Vehicle Code, that  is  donated
21    to   a   corporation,  limited  liability  company,  society,
22    association, foundation, or institution that is determined by
23    the Department to be organized and operated  exclusively  for
24    educational  purposes.   For  purposes  of this exemption, "a
25    corporation, limited liability company, society, association,
26    foundation, or institution organized and operated exclusively
27    for educational  purposes"  means  all  tax-supported  public
28    schools, private schools that offer systematic instruction in
29    useful  branches  of  learning  by  methods  common to public
30    schools  and  that  compare  favorably  in  their  scope  and
31    intensity with the course of study presented in tax-supported
32    schools, and vocational or technical  schools  or  institutes
33    organized  and  operated  exclusively  to provide a course of
34    study of not less than  6  weeks  duration  and  designed  to
 
                            -18-               LRB9204480SMdv
 1    prepare  individuals to follow a trade or to pursue a manual,
 2    technical, mechanical, industrial,  business,  or  commercial
 3    occupation.
 4        (21) (20)  Beginning January 1, 2000,  personal property,
 5    including  food, purchased through fundraising events for the
 6    benefit of  a  public  or  private  elementary  or  secondary
 7    school,  a  group  of  those  schools,  or one or more school
 8    districts if the events are sponsored by an entity recognized
 9    by the school district that consists primarily of  volunteers
10    and  includes  parents  and  teachers of the school children.
11    This paragraph does not apply to fundraising events  (i)  for
12    the benefit of private home instruction or (ii) for which the
13    fundraising  entity  purchases  the personal property sold at
14    the events from another individual or entity  that  sold  the
15    property  for the purpose of resale by the fundraising entity
16    and that profits from the sale  to  the  fundraising  entity.
17    This paragraph is exempt from the provisions of Section 3-75.
18        (22)   (19)  Beginning  January  1,  2000,  new  or  used
19    automatic vending machines that prepare and  serve  hot  food
20    and  beverages,  including coffee, soup, and other items, and
21    replacement parts for these  machines.    This  paragraph  is
22    exempt from the provisions of Section 3-75.
23        (23)  Beginning  January  1, 2002, gasohol, as defined in
24    Section 3-40 of the Use Tax Act.    This  paragraph  (23)  is
25    exempt from the provisions of Section 3-75.
26    (Source:  P.A.  90-14,  eff.  7-1-97;  90-552, eff. 12-12-97;
27    90-605, eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200,  eff.
28    7-20-99;  91-439,  eff. 8-6-99; 91-637, eff. 8-20-99; 91-644,
29    eff. 8-20-99; revised 9-29-99.)

30        (35 ILCS 110/3-10) (from Ch. 120, par. 439.33-10)
31        Sec. 3-10.  Rate of tax.  Unless  otherwise  provided  in
32    this  Section,  the tax imposed by this Act is at the rate of
33    6.25% of the selling  price  of  tangible  personal  property
 
                            -19-               LRB9204480SMdv
 1    transferred  as  an incident to the sale of service, but, for
 2    the purpose of computing this tax,  in  no  event  shall  the
 3    selling  price be less than the cost price of the property to
 4    the serviceman.
 5        Beginning on July 1, 2000 and through December 31,  2000,
 6    with  respect to motor fuel, as defined in Section 1.1 of the
 7    Motor Fuel Tax Law, and gasohol, as defined in  Section  3-40
 8    of the Use Tax Act, the tax is imposed at the rate of 1.25%.
 9        With  respect  to gasohol, as defined in the Use Tax Act,
10    the tax imposed by this Act applies to  70%  of  the  selling
11    price  of  property transferred as an incident to the sale of
12    service on or after January 1, 1990, and  before  January  1,
13    2002  July  1,  2003,  and  to  100%  of  the  selling  price
14    thereafter.
15        At  the  election  of  any registered serviceman made for
16    each fiscal year, sales of service  in  which  the  aggregate
17    annual  cost  price of tangible personal property transferred
18    as an incident to the sales of service is less than  35%,  or
19    75% in the case of servicemen transferring prescription drugs
20    or  servicemen  engaged  in  graphic  arts production, of the
21    aggregate annual total  gross  receipts  from  all  sales  of
22    service,  the  tax  imposed by this Act shall be based on the
23    serviceman's cost price of  the  tangible  personal  property
24    transferred as an incident to the sale of those services.
25        The  tax  shall  be  imposed  at  the  rate of 1% on food
26    prepared for immediate consumption and  transferred  incident
27    to  a  sale  of  service  subject  to this Act or the Service
28    Occupation Tax Act by an entity licensed under  the  Hospital
29    Licensing  Act,  the Nursing Home Care Act, or the Child Care
30    Act of 1969.  The tax shall also be imposed at the rate of 1%
31    on food for human consumption that is to be consumed off  the
32    premises  where  it  is sold (other than alcoholic beverages,
33    soft drinks, and food that has been  prepared  for  immediate
34    consumption  and is not otherwise included in this paragraph)
 
                            -20-               LRB9204480SMdv
 1    and  prescription  and  nonprescription   medicines,   drugs,
 2    medical  appliances, modifications to a motor vehicle for the
 3    purpose of rendering it usable  by  a  disabled  person,  and
 4    insulin,  urine testing materials, syringes, and needles used
 5    by diabetics,  for  human  use.  For  the  purposes  of  this
 6    Section, the term "soft drinks" means any complete, finished,
 7    ready-to-use, non-alcoholic drink, whether carbonated or not,
 8    including  but  not limited to soda water, cola, fruit juice,
 9    vegetable juice, carbonated water, and all other preparations
10    commonly known as soft drinks of whatever kind or description
11    that are contained in  any  closed  or  sealed  bottle,  can,
12    carton, or container, regardless of size.  "Soft drinks" does
13    not   include   coffee,  tea,  non-carbonated  water,  infant
14    formula, milk or milk products as  defined  in  the  Grade  A
15    Pasteurized  Milk and Milk Products Act, or drinks containing
16    50% or more natural fruit or vegetable juice.
17        Notwithstanding any other provisions of this  Act,  "food
18    for human consumption that is to be consumed off the premises
19    where  it  is  sold" includes all food sold through a vending
20    machine, except  soft  drinks  and  food  products  that  are
21    dispensed  hot  from  a  vending  machine,  regardless of the
22    location of the vending machine.
23        If the property that is acquired  from  a  serviceman  is
24    acquired  outside  Illinois  and used outside Illinois before
25    being brought to Illinois for use here and is  taxable  under
26    this  Act,  the  "selling price" on which the tax is computed
27    shall be reduced by an amount that  represents  a  reasonable
28    allowance   for   depreciation   for   the  period  of  prior
29    out-of-state use.
30    (Source: P.A. 90-605, eff.  6-30-98;  90-606,  eff.  6-30-98;
31    91-51,  eff.  6-30-99;  91-541,  eff.  8-13-99;  91-872, eff.
32    7-1-00.)

33        Section 15.  The Service Occupation Tax Act is amended by
 
                            -21-               LRB9204480SMdv
 1    changing Section 3-5 and 3-10 as follows:

 2        (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
 3        Sec. 3-5.  Exemptions.  The following  tangible  personal
 4    property is exempt from the tax imposed by this Act:
 5        (1)  Personal  property  sold  by a corporation, society,
 6    association, foundation, institution, or organization,  other
 7    than  a  limited  liability  company,  that  is organized and
 8    operated as  a  not-for-profit  service  enterprise  for  the
 9    benefit  of  persons 65 years of age or older if the personal
10    property was not purchased by the enterprise for the  purpose
11    of resale by the enterprise.
12        (2)  Personal  property  purchased  by  a  not-for-profit
13    Illinois  county  fair  association  for  use  in conducting,
14    operating, or promoting the county fair.
15        (3)  Personal property purchased  by  any  not-for-profit
16    arts  or  cultural  organization  that  establishes, by proof
17    required by the Department by rule, that it has  received  an
18    exemption   under  Section  501(c)(3) of the Internal Revenue
19    Code and that is organized and operated for the  presentation
20    or  support  of  arts or cultural programming, activities, or
21    services.  These organizations include, but are  not  limited
22    to,  music  and  dramatic arts organizations such as symphony
23    orchestras and theatrical groups, arts and  cultural  service
24    organizations,    local    arts    councils,    visual   arts
25    organizations, and media arts organizations.
26        (4)  Legal  tender,  currency,  medallions,  or  gold  or
27    silver  coinage  issued  by  the  State  of   Illinois,   the
28    government of the United States of America, or the government
29    of any foreign country, and bullion.
30        (5)  Graphic  arts  machinery  and  equipment,  including
31    repair   and  replacement  parts,  both  new  and  used,  and
32    including that manufactured on special order or purchased for
33    lease, certified by the purchaser to be  used  primarily  for
 
                            -22-               LRB9204480SMdv
 1    graphic arts production.
 2        (6)  Personal   property   sold  by  a  teacher-sponsored
 3    student  organization  affiliated  with  an   elementary   or
 4    secondary school located in Illinois.
 5        (7)  Farm  machinery  and  equipment,  both new and used,
 6    including that manufactured on special  order,  certified  by
 7    the purchaser to be used primarily for production agriculture
 8    or   State   or   federal  agricultural  programs,  including
 9    individual replacement parts for the machinery and equipment,
10    including machinery and equipment purchased  for  lease,  and
11    including implements of husbandry defined in Section 1-130 of
12    the  Illinois  Vehicle  Code, farm machinery and agricultural
13    chemical and fertilizer spreaders, and nurse wagons  required
14    to  be registered under Section 3-809 of the Illinois Vehicle
15    Code, but excluding  other  motor  vehicles  required  to  be
16    registered  under  the  Illinois  Vehicle Code. Horticultural
17    polyhouses or hoop houses used for propagating,  growing,  or
18    overwintering  plants  shall be considered farm machinery and
19    equipment under this item (7). Agricultural  chemical  tender
20    tanks  and dry boxes shall include units sold separately from
21    a motor vehicle  required  to  be  licensed  and  units  sold
22    mounted  on  a  motor  vehicle required to be licensed if the
23    selling price of the tender is separately stated.
24        Farm machinery  and  equipment  shall  include  precision
25    farming  equipment  that  is  installed  or  purchased  to be
26    installed on farm machinery and equipment including, but  not
27    limited   to,   tractors,   harvesters,  sprayers,  planters,
28    seeders, or spreaders. Precision farming equipment  includes,
29    but  is  not  limited  to,  soil  testing sensors, computers,
30    monitors, software, global positioning and  mapping  systems,
31    and other such equipment.
32        Farm  machinery  and  equipment  also includes computers,
33    sensors, software, and related equipment  used  primarily  in
34    the  computer-assisted  operation  of  production agriculture
 
                            -23-               LRB9204480SMdv
 1    facilities,  equipment,  and  activities  such  as,  but  not
 2    limited to, the collection, monitoring,  and  correlation  of
 3    animal  and  crop  data for the purpose of formulating animal
 4    diets and agricultural chemicals.  This item  (7)  is  exempt
 5    from the provisions of Section 3-55.
 6        (8)  Fuel  and  petroleum  products sold to or used by an
 7    air common carrier, certified by the carrier to be  used  for
 8    consumption,  shipment,  or  storage  in  the  conduct of its
 9    business as an air common carrier, for a flight destined  for
10    or  returning from a location or locations outside the United
11    States without regard  to  previous  or  subsequent  domestic
12    stopovers.
13        (9)  Proceeds  of  mandatory  service  charges separately
14    stated on customers' bills for the purchase  and  consumption
15    of food and beverages, to the extent that the proceeds of the
16    service  charge  are  in  fact  turned  over  as tips or as a
17    substitute for tips to the employees who participate directly
18    in preparing, serving, hosting or cleaning  up  the  food  or
19    beverage function with respect to which the service charge is
20    imposed.
21        (10)  Oil  field  exploration,  drilling,  and production
22    equipment, including (i) rigs and parts of rigs, rotary rigs,
23    cable tool rigs, and workover rigs,  (ii)  pipe  and  tubular
24    goods,  including  casing  and drill strings, (iii) pumps and
25    pump-jack units, (iv) storage tanks and flow lines,  (v)  any
26    individual   replacement  part  for  oil  field  exploration,
27    drilling, and production equipment, and  (vi)  machinery  and
28    equipment  purchased  for lease; but excluding motor vehicles
29    required to be registered under the Illinois Vehicle Code.
30        (11)  Photoprocessing machinery and equipment,  including
31    repair  and  replacement  parts, both new and used, including
32    that  manufactured  on  special  order,  certified   by   the
33    purchaser  to  be  used  primarily  for  photoprocessing, and
34    including photoprocessing machinery and  equipment  purchased
 
                            -24-               LRB9204480SMdv
 1    for lease.
 2        (12)  Coal   exploration,   mining,  offhighway  hauling,
 3    processing, maintenance, and reclamation equipment, including
 4    replacement parts  and  equipment,  and  including  equipment
 5    purchased for lease, but excluding motor vehicles required to
 6    be registered under the Illinois Vehicle Code.
 7        (13)  Food  for  human consumption that is to be consumed
 8    off the premises where  it  is  sold  (other  than  alcoholic
 9    beverages,  soft  drinks  and food that has been prepared for
10    immediate consumption) and prescription and  non-prescription
11    medicines,  drugs,  medical  appliances,  and  insulin, urine
12    testing materials, syringes, and needles used  by  diabetics,
13    for  human  use, when purchased for use by a person receiving
14    medical assistance under Article 5 of the Illinois Public Aid
15    Code who resides in a licensed long-term  care  facility,  as
16    defined in the Nursing Home Care Act.
17        (14)  Semen used for artificial insemination of livestock
18    for direct agricultural production.
19        (15)  Horses, or interests in horses, registered with and
20    meeting  the  requirements  of  any of the Arabian Horse Club
21    Registry of America, Appaloosa Horse Club,  American  Quarter
22    Horse  Association,  United  States  Trotting Association, or
23    Jockey Club, as appropriate, used for purposes of breeding or
24    racing for prizes.
25        (16)  Computers and communications equipment utilized for
26    any hospital purpose and equipment  used  in  the  diagnosis,
27    analysis,  or treatment of hospital patients sold to a lessor
28    who leases the equipment, under a lease of one year or longer
29    executed or in effect at the  time  of  the  purchase,  to  a
30    hospital  that  has  been  issued  an  active  tax  exemption
31    identification  number  by the Department under Section 1g of
32    the Retailers' Occupation Tax Act.
33        (17)  Personal property sold to a lessor who  leases  the
34    property,  under a lease of one year or longer executed or in
 
                            -25-               LRB9204480SMdv
 1    effect at the time of the purchase, to  a  governmental  body
 2    that  has  been issued an active tax exemption identification
 3    number by the Department under Section 1g of  the  Retailers'
 4    Occupation Tax Act.
 5        (18)  Beginning  with  taxable  years  ending on or after
 6    December 31, 1995 and ending with taxable years ending on  or
 7    before  December  31, 2004, personal property that is donated
 8    for disaster relief to  be  used  in  a  State  or  federally
 9    declared disaster area in Illinois or bordering Illinois by a
10    manufacturer  or retailer that is registered in this State to
11    a   corporation,   society,   association,   foundation,   or
12    institution that  has  been  issued  a  sales  tax  exemption
13    identification  number by the Department that assists victims
14    of the disaster who reside within the declared disaster area.
15        (19)  Beginning with taxable years  ending  on  or  after
16    December  31, 1995 and ending with taxable years ending on or
17    before December 31, 2004, personal property that is  used  in
18    the  performance  of  infrastructure  repairs  in this State,
19    including but not limited to  municipal  roads  and  streets,
20    access  roads,  bridges,  sidewalks,  waste disposal systems,
21    water and  sewer  line  extensions,  water  distribution  and
22    purification  facilities,  storm water drainage and retention
23    facilities, and sewage treatment facilities, resulting from a
24    State or federally declared disaster in Illinois or bordering
25    Illinois  when  such  repairs  are  initiated  on  facilities
26    located in the declared disaster area within 6  months  after
27    the disaster.
28        (20)  Beginning  July 1, 1999, game or game birds sold at
29    a "game breeding and hunting preserve  area"  or  an  "exotic
30    game  hunting  area"  as those terms are used in the Wildlife
31    Code or at a hunting enclosure approved through rules adopted
32    by the Department of Natural Resources.   This  paragraph  is
33    exempt from the provisions of Section 3-55.
34        (21)  (20)  A  motor  vehicle, as that term is defined in
 
                            -26-               LRB9204480SMdv
 1    Section 1-146 of the Illinois Vehicle Code, that  is  donated
 2    to   a   corporation,  limited  liability  company,  society,
 3    association, foundation, or institution that is determined by
 4    the Department to be organized and operated  exclusively  for
 5    educational  purposes.   For  purposes  of this exemption, "a
 6    corporation, limited liability company, society, association,
 7    foundation, or institution organized and operated exclusively
 8    for educational  purposes"  means  all  tax-supported  public
 9    schools, private schools that offer systematic instruction in
10    useful  branches  of  learning  by  methods  common to public
11    schools  and  that  compare  favorably  in  their  scope  and
12    intensity with the course of study presented in tax-supported
13    schools, and vocational or technical  schools  or  institutes
14    organized  and  operated  exclusively  to provide a course of
15    study of not less than  6  weeks  duration  and  designed  to
16    prepare  individuals to follow a trade or to pursue a manual,
17    technical, mechanical, industrial,  business,  or  commercial
18    occupation.
19        (22) (21)  Beginning January 1, 2000,  personal property,
20    including  food, purchased through fundraising events for the
21    benefit of  a  public  or  private  elementary  or  secondary
22    school,  a  group  of  those  schools,  or one or more school
23    districts if the events are sponsored by an entity recognized
24    by the school district that consists primarily of  volunteers
25    and  includes  parents  and  teachers of the school children.
26    This paragraph does not apply to fundraising events  (i)  for
27    the benefit of private home instruction or (ii) for which the
28    fundraising  entity  purchases  the personal property sold at
29    the events from another individual or entity  that  sold  the
30    property  for the purpose of resale by the fundraising entity
31    and that profits from the sale  to  the  fundraising  entity.
32    This paragraph is exempt from the provisions of Section 3-55.
33        (23)   (20)  Beginning  January  1,  2000,  new  or  used
34    automatic vending machines that prepare and  serve  hot  food
 
                            -27-               LRB9204480SMdv
 1    and  beverages,  including coffee, soup, and other items, and
 2    replacement parts for these  machines.    This  paragraph  is
 3    exempt from the provisions of Section 3-55.
 4        (24)  Beginning  January  1, 2002, gasohol, as defined in
 5    Section 3-40 of the Use Tax Act.    This  paragraph  (24)  is
 6    exempt from the provisions of Section 3-55.
 7    (Source: P.A.  90-14,  eff.  7-1-97;  90-552,  eff. 12-12-97;
 8    90-605, eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200,  eff.
 9    7-20-99;  91-439,  eff. 8-6-99; 91-533, eff. 8-13-99; 91-637,
10    eff. 8-20-99; 91-644, eff. 8-20-99; revised 9-29-99.)

11        (35 ILCS 115/3-10) (from Ch. 120, par. 439.103-10)
12        Sec. 3-10. Rate of tax.   Unless  otherwise  provided  in
13    this  Section,  the tax imposed by this Act is at the rate of
14    6.25% of the "selling price", as defined in Section 2 of  the
15    Service  Use Tax Act, of the tangible personal property.  For
16    the purpose of computing this tax,  in  no  event  shall  the
17    "selling price" be less than the cost price to the serviceman
18    of  the  tangible personal property transferred.  The selling
19    price of each item of tangible personal property  transferred
20    as  an  incident  of  a  sale  of  service  may be shown as a
21    distinct and separate item on the serviceman's billing to the
22    service customer. If the selling price is not so  shown,  the
23    selling  price of the tangible personal property is deemed to
24    be 50% of the serviceman's  entire  billing  to  the  service
25    customer.   When,  however, a serviceman contracts to design,
26    develop, and produce special order  machinery  or  equipment,
27    the   tax   imposed  by  this  Act  shall  be  based  on  the
28    serviceman's cost price of  the  tangible  personal  property
29    transferred incident to the completion of the contract.
30        Beginning  on July 1, 2000 and through December 31, 2000,
31    with respect to motor fuel, as defined in Section 1.1 of  the
32    Motor  Fuel  Tax Law, and gasohol, as defined in Section 3-40
33    of the Use Tax Act, the tax is imposed at the rate of 1.25%.
 
                            -28-               LRB9204480SMdv
 1        With respect to gasohol, as defined in the Use  Tax  Act,
 2    the  tax  imposed  by this Act shall apply to 70% of the cost
 3    price of property transferred as an incident to the  sale  of
 4    service  on  or  after January 1, 1990, and before January 1,
 5    2002 July 1, 2003, and to 100% of the cost price thereafter.
 6        At the election of any  registered  serviceman  made  for
 7    each  fiscal  year,  sales  of service in which the aggregate
 8    annual cost price of tangible personal  property  transferred
 9    as  an  incident to the sales of service is less than 35%, or
10    75% in the case of servicemen transferring prescription drugs
11    or servicemen engaged in  graphic  arts  production,  of  the
12    aggregate  annual  total  gross  receipts  from  all sales of
13    service, the tax imposed by this Act shall be  based  on  the
14    serviceman's  cost  price  of  the tangible personal property
15    transferred incident to the sale of those services.
16        The tax shall be imposed  at  the  rate  of  1%  on  food
17    prepared  for  immediate consumption and transferred incident
18    to a sale of service subject  to  this  Act  or  the  Service
19    Occupation  Tax  Act by an entity licensed under the Hospital
20    Licensing Act, the Nursing Home Care Act, or the  Child  Care
21    Act of 1969.  The tax shall also be imposed at the rate of 1%
22    on  food for human consumption that is to be consumed off the
23    premises where it is sold (other  than  alcoholic  beverages,
24    soft  drinks,  and  food that has been prepared for immediate
25    consumption and is not otherwise included in this  paragraph)
26    and   prescription   and  nonprescription  medicines,  drugs,
27    medical appliances, modifications to a motor vehicle for  the
28    purpose  of  rendering  it  usable  by a disabled person, and
29    insulin, urine testing materials, syringes, and needles  used
30    by  diabetics,  for  human  use.   For  the  purposes of this
31    Section, the term "soft drinks" means any complete, finished,
32    ready-to-use, non-alcoholic drink, whether carbonated or not,
33    including but not limited to soda water, cola,  fruit  juice,
34    vegetable juice, carbonated water, and all other preparations
 
                            -29-               LRB9204480SMdv
 1    commonly known as soft drinks of whatever kind or description
 2    that  are  contained  in any closed or sealed can, carton, or
 3    container,  regardless  of  size.   "Soft  drinks"  does  not
 4    include coffee, tea, non-carbonated  water,  infant  formula,
 5    milk  or  milk products as defined in the Grade A Pasteurized
 6    Milk and Milk Products Act, or drinks containing 50% or  more
 7    natural fruit or vegetable juice.
 8        Notwithstanding  any  other provisions of this Act, "food
 9    for human consumption that is to be consumed off the premises
10    where it is sold" includes all food sold  through  a  vending
11    machine,  except  soft  drinks  and  food  products  that are
12    dispensed hot from  a  vending  machine,  regardless  of  the
13    location of the vending machine.
14    (Source:  P.A.  90-605,  eff.  6-30-98; 90-606, eff. 6-30-98;
15    91-51, 6-30-99; 91-541, eff. 8-13-99; 91-872, eff. 7-1-00.)

16        Section 20.  The Retailers' Occupation Tax Act is amended
17    by changing Sections 2-5 and 2-20 as follows:

18        (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
19        Sec. 2-5.  Exemptions.  Gross receipts from proceeds from
20    the sale of the  following  tangible  personal  property  are
21    exempt from the tax imposed by this Act:
22        (1)  Farm chemicals.
23        (2)  Farm  machinery  and  equipment,  both new and used,
24    including that manufactured on special  order,  certified  by
25    the purchaser to be used primarily for production agriculture
26    or   State   or   federal  agricultural  programs,  including
27    individual replacement parts for the machinery and equipment,
28    including machinery and equipment purchased  for  lease,  and
29    including implements of husbandry defined in Section 1-130 of
30    the  Illinois  Vehicle  Code, farm machinery and agricultural
31    chemical and fertilizer spreaders, and nurse wagons  required
32    to  be registered under Section 3-809 of the Illinois Vehicle
 
                            -30-               LRB9204480SMdv
 1    Code, but excluding  other  motor  vehicles  required  to  be
 2    registered  under  the  Illinois  Vehicle Code. Horticultural
 3    polyhouses or hoop houses used for propagating,  growing,  or
 4    overwintering  plants  shall be considered farm machinery and
 5    equipment under this item (2). Agricultural  chemical  tender
 6    tanks  and dry boxes shall include units sold separately from
 7    a motor vehicle  required  to  be  licensed  and  units  sold
 8    mounted  on  a  motor vehicle required to be licensed, if the
 9    selling price of the tender is separately stated.
10        Farm machinery  and  equipment  shall  include  precision
11    farming  equipment  that  is  installed  or  purchased  to be
12    installed on farm machinery and equipment including, but  not
13    limited   to,   tractors,   harvesters,  sprayers,  planters,
14    seeders, or spreaders. Precision farming equipment  includes,
15    but  is  not  limited  to,  soil  testing sensors, computers,
16    monitors, software, global positioning and  mapping  systems,
17    and other such equipment.
18        Farm  machinery  and  equipment  also includes computers,
19    sensors, software, and related equipment  used  primarily  in
20    the  computer-assisted  operation  of  production agriculture
21    facilities,  equipment,  and  activities  such  as,  but  not
22    limited to, the collection, monitoring,  and  correlation  of
23    animal  and  crop  data for the purpose of formulating animal
24    diets and agricultural chemicals.  This item  (7)  is  exempt
25    from the provisions of Section 2-70.
26        (3)  Distillation machinery and equipment, sold as a unit
27    or  kit, assembled or installed by the retailer, certified by
28    the user to be used only for the production of ethyl  alcohol
29    that  will  be  used  for  consumption  as motor fuel or as a
30    component of motor fuel for the personal use of the user, and
31    not subject to sale or resale.
32        (4)  Graphic  arts  machinery  and  equipment,  including
33    repair  and  replacement  parts,  both  new  and  used,   and
34    including that manufactured on special order or purchased for
 
                            -31-               LRB9204480SMdv
 1    lease,  certified  by  the purchaser to be used primarily for
 2    graphic arts production.
 3        (5)  A motor vehicle  of  the  first  division,  a  motor
 4    vehicle of the second division that is a self-contained motor
 5    vehicle  designed  or permanently converted to provide living
 6    quarters for  recreational,  camping,  or  travel  use,  with
 7    direct  walk  through  access to the living quarters from the
 8    driver's seat, or a motor vehicle of the second division that
 9    is of the van configuration designed for  the  transportation
10    of not less than 7 nor more than 16 passengers, as defined in
11    Section  1-146 of the Illinois Vehicle Code, that is used for
12    automobile renting, as  defined  in  the  Automobile  Renting
13    Occupation and Use Tax Act.
14        (6)  Personal   property   sold  by  a  teacher-sponsored
15    student  organization  affiliated  with  an   elementary   or
16    secondary school located in Illinois.
17        (7)  Proceeds  of  that portion of the selling price of a
18    passenger car the sale of which is subject to the Replacement
19    Vehicle Tax.
20        (8)  Personal property sold to an  Illinois  county  fair
21    association  for  use  in conducting, operating, or promoting
22    the county fair.
23        (9)  Personal property sold to a not-for-profit  arts  or
24    cultural  organization that establishes, by proof required by
25    the Department by rule, that it  has  received  an  exemption
26    under Section 501(c)(3) of the Internal Revenue Code and that
27    is  organized and operated for the presentation or support of
28    arts or cultural programming, activities, or services.  These
29    organizations include, but are  not  limited  to,  music  and
30    dramatic  arts  organizations such as symphony orchestras and
31    theatrical groups, arts and cultural  service  organizations,
32    local  arts  councils,  visual  arts organizations, and media
33    arts organizations.
34        (10)  Personal property sold by a  corporation,  society,
 
                            -32-               LRB9204480SMdv
 1    association,  foundation, institution, or organization, other
 2    than a limited  liability  company,  that  is  organized  and
 3    operated  as  a  not-for-profit  service  enterprise  for the
 4    benefit of persons 65 years of age or older if  the  personal
 5    property  was not purchased by the enterprise for the purpose
 6    of resale by the enterprise.
 7        (11)  Personal property sold to a governmental body, to a
 8    corporation, society, association, foundation, or institution
 9    organized and operated exclusively for charitable, religious,
10    or educational purposes, or to a not-for-profit  corporation,
11    society,    association,    foundation,    institution,    or
12    organization  that  has  no compensated officers or employees
13    and  that  is  organized  and  operated  primarily  for   the
14    recreation  of  persons  55  years of age or older. A limited
15    liability company may qualify for the  exemption  under  this
16    paragraph  only if the limited liability company is organized
17    and operated exclusively for  educational  purposes.  On  and
18    after July 1, 1987, however, no entity otherwise eligible for
19    this exemption shall make tax-free purchases unless it has an
20    active identification number issued by the Department.
21        (12)  Personal  property  sold to interstate carriers for
22    hire for use as rolling stock moving in  interstate  commerce
23    or  to lessors under leases of one year or longer executed or
24    in effect at the time of purchase by interstate carriers  for
25    hire  for  use as rolling stock moving in interstate commerce
26    and equipment  operated  by  a  telecommunications  provider,
27    licensed  as  a  common carrier by the Federal Communications
28    Commission, which is permanently installed in or  affixed  to
29    aircraft moving in interstate commerce.
30        (13)  Proceeds from sales to owners, lessors, or shippers
31    of  tangible personal property that is utilized by interstate
32    carriers  for  hire  for  use  as  rolling  stock  moving  in
33    interstate   commerce   and   equipment   operated    by    a
34    telecommunications  provider, licensed as a common carrier by
 
                            -33-               LRB9204480SMdv
 1    the Federal Communications Commission, which  is  permanently
 2    installed  in  or  affixed  to  aircraft moving in interstate
 3    commerce.
 4        (14)  Machinery and equipment that will be  used  by  the
 5    purchaser,  or  a  lessee  of the purchaser, primarily in the
 6    process of  manufacturing  or  assembling  tangible  personal
 7    property  for  wholesale or retail sale or lease, whether the
 8    sale or lease is made directly by the manufacturer or by some
 9    other person, whether the materials used in the  process  are
10    owned  by  the  manufacturer or some other person, or whether
11    the sale or lease is made apart from or as an incident to the
12    seller's engaging in  the  service  occupation  of  producing
13    machines,  tools,  dies,  jigs,  patterns,  gauges,  or other
14    similar items of no commercial value on special order  for  a
15    particular purchaser.
16        (15)  Proceeds  of  mandatory  service charges separately
17    stated on customers' bills for purchase  and  consumption  of
18    food  and  beverages,  to the extent that the proceeds of the
19    service charge are in fact  turned  over  as  tips  or  as  a
20    substitute for tips to the employees who participate directly
21    in  preparing,  serving,  hosting  or cleaning up the food or
22    beverage function with respect to which the service charge is
23    imposed.
24        (16)  Petroleum products  sold  to  a  purchaser  if  the
25    seller  is prohibited by federal law from charging tax to the
26    purchaser.
27        (17)  Tangible personal property sold to a common carrier
28    by rail or motor that receives the physical possession of the
29    property in Illinois and that  transports  the  property,  or
30    shares  with  another common carrier in the transportation of
31    the property, out of Illinois on a standard uniform  bill  of
32    lading  showing  the seller of the property as the shipper or
33    consignor of the property to a destination outside  Illinois,
34    for use outside Illinois.
 
                            -34-               LRB9204480SMdv
 1        (18)  Legal  tender,  currency,  medallions,  or  gold or
 2    silver  coinage  issued  by  the  State  of   Illinois,   the
 3    government of the United States of America, or the government
 4    of any foreign country, and bullion.
 5        (19)  Oil  field  exploration,  drilling,  and production
 6    equipment, including (i) rigs and parts of rigs, rotary rigs,
 7    cable tool rigs, and workover rigs,  (ii)  pipe  and  tubular
 8    goods,  including  casing  and drill strings, (iii) pumps and
 9    pump-jack units, (iv) storage tanks and flow lines,  (v)  any
10    individual   replacement  part  for  oil  field  exploration,
11    drilling, and production equipment, and  (vi)  machinery  and
12    equipment  purchased  for lease; but excluding motor vehicles
13    required to be registered under the Illinois Vehicle Code.
14        (20)  Photoprocessing machinery and equipment,  including
15    repair  and  replacement  parts, both new and used, including
16    that  manufactured  on  special  order,  certified   by   the
17    purchaser  to  be  used  primarily  for  photoprocessing, and
18    including photoprocessing machinery and  equipment  purchased
19    for lease.
20        (21)  Coal   exploration,   mining,  offhighway  hauling,
21    processing, maintenance, and reclamation equipment, including
22    replacement parts  and  equipment,  and  including  equipment
23    purchased for lease, but excluding motor vehicles required to
24    be registered under the Illinois Vehicle Code.
25        (22)  Fuel  and  petroleum products sold to or used by an
26    air  carrier,  certified  by  the  carrier  to  be  used  for
27    consumption, shipment, or  storage  in  the  conduct  of  its
28    business  as an air common carrier, for a flight destined for
29    or returning from a location or locations outside the  United
30    States  without  regard  to  previous  or subsequent domestic
31    stopovers.
32        (23)  A  transaction  in  which  the  purchase  order  is
33    received by a florist who is located  outside  Illinois,  but
34    who has a florist located in Illinois deliver the property to
 
                            -35-               LRB9204480SMdv
 1    the purchaser or the purchaser's donee in Illinois.
 2        (24)  Fuel  consumed  or  used in the operation of ships,
 3    barges, or vessels that are used  primarily  in  or  for  the
 4    transportation  of  property or the conveyance of persons for
 5    hire on rivers  bordering  on  this  State  if  the  fuel  is
 6    delivered  by  the  seller to the purchaser's barge, ship, or
 7    vessel while it is afloat upon that bordering river.
 8        (25)  A motor vehicle sold in this State to a nonresident
 9    even though the motor vehicle is delivered to the nonresident
10    in this State, if the motor vehicle is not to  be  titled  in
11    this  State, and if a driveaway decal permit is issued to the
12    motor vehicle as provided in Section 3-603  of  the  Illinois
13    Vehicle  Code  or  if  the  nonresident purchaser has vehicle
14    registration plates to transfer to  the  motor  vehicle  upon
15    returning  to  his  or  her  home state.  The issuance of the
16    driveaway   decal   permit   or   having   the   out-of-state
17    registration plates to be transferred is prima facie evidence
18    that the motor vehicle will not be titled in this State.
19        (26)  Semen used for artificial insemination of livestock
20    for direct agricultural production.
21        (27)  Horses, or interests in horses, registered with and
22    meeting the requirements of any of  the  Arabian  Horse  Club
23    Registry  of  America, Appaloosa Horse Club, American Quarter
24    Horse Association, United  States  Trotting  Association,  or
25    Jockey Club, as appropriate, used for purposes of breeding or
26    racing for prizes.
27        (28)  Computers and communications equipment utilized for
28    any  hospital  purpose  and  equipment used in the diagnosis,
29    analysis, or treatment of hospital patients sold to a  lessor
30    who leases the equipment, under a lease of one year or longer
31    executed  or  in  effect  at  the  time of the purchase, to a
32    hospital  that  has  been  issued  an  active  tax  exemption
33    identification number by the Department under Section  1g  of
34    this Act.
 
                            -36-               LRB9204480SMdv
 1        (29)  Personal  property  sold to a lessor who leases the
 2    property, under a lease of one year or longer executed or  in
 3    effect  at  the  time of the purchase, to a governmental body
 4    that has been issued an active tax  exemption  identification
 5    number by the Department under Section 1g of this Act.
 6        (30)  Beginning  with  taxable  years  ending on or after
 7    December 31, 1995 and ending with taxable years ending on  or
 8    before  December  31, 2004, personal property that is donated
 9    for disaster relief to  be  used  in  a  State  or  federally
10    declared disaster area in Illinois or bordering Illinois by a
11    manufacturer  or retailer that is registered in this State to
12    a   corporation,   society,   association,   foundation,   or
13    institution that  has  been  issued  a  sales  tax  exemption
14    identification  number by the Department that assists victims
15    of the disaster who reside within the declared disaster area.
16        (31)  Beginning with taxable years  ending  on  or  after
17    December  31, 1995 and ending with taxable years ending on or
18    before December 31, 2004, personal property that is  used  in
19    the  performance  of  infrastructure  repairs  in this State,
20    including but not limited to  municipal  roads  and  streets,
21    access  roads,  bridges,  sidewalks,  waste disposal systems,
22    water and  sewer  line  extensions,  water  distribution  and
23    purification  facilities,  storm water drainage and retention
24    facilities, and sewage treatment facilities, resulting from a
25    State or federally declared disaster in Illinois or bordering
26    Illinois  when  such  repairs  are  initiated  on  facilities
27    located in the declared disaster area within 6  months  after
28    the disaster.
29        (32)  Beginning  July 1, 1999, game or game birds sold at
30    a "game breeding and hunting preserve  area"  or  an  "exotic
31    game  hunting  area"  as those terms are used in the Wildlife
32    Code or at a hunting enclosure approved through rules adopted
33    by the Department of Natural Resources.   This  paragraph  is
34    exempt from the provisions of Section 2-70.
 
                            -37-               LRB9204480SMdv
 1        (33)  (32)  A  motor  vehicle, as that term is defined in
 2    Section 1-146 of the Illinois Vehicle Code, that  is  donated
 3    to   a   corporation,  limited  liability  company,  society,
 4    association, foundation, or institution that is determined by
 5    the Department to be organized and operated  exclusively  for
 6    educational  purposes.   For  purposes  of this exemption, "a
 7    corporation, limited liability company, society, association,
 8    foundation, or institution organized and operated exclusively
 9    for educational  purposes"  means  all  tax-supported  public
10    schools, private schools that offer systematic instruction in
11    useful  branches  of  learning  by  methods  common to public
12    schools  and  that  compare  favorably  in  their  scope  and
13    intensity with the course of study presented in tax-supported
14    schools, and vocational or technical  schools  or  institutes
15    organized  and  operated  exclusively  to provide a course of
16    study of not less than  6  weeks  duration  and  designed  to
17    prepare  individuals to follow a trade or to pursue a manual,
18    technical, mechanical, industrial,  business,  or  commercial
19    occupation.
20        (34) (33)  Beginning January 1, 2000,  personal property,
21    including  food, purchased through fundraising events for the
22    benefit of  a  public  or  private  elementary  or  secondary
23    school,  a  group  of  those  schools,  or one or more school
24    districts if the events are sponsored by an entity recognized
25    by the school district that consists primarily of  volunteers
26    and  includes  parents  and  teachers of the school children.
27    This paragraph does not apply to fundraising events  (i)  for
28    the benefit of private home instruction or (ii) for which the
29    fundraising  entity  purchases  the personal property sold at
30    the events from another individual or entity  that  sold  the
31    property  for the purpose of resale by the fundraising entity
32    and that profits from the sale  to  the  fundraising  entity.
33    This paragraph is exempt from the provisions of Section 2-70.
34        (35)   (32)  Beginning  January  1,  2000,  new  or  used
 
                            -38-               LRB9204480SMdv
 1    automatic vending machines that prepare and  serve  hot  food
 2    and  beverages,  including coffee, soup, and other items, and
 3    replacement parts for these  machines.    This  paragraph  is
 4    exempt from the provisions of Section 2-70.
 5        (36)  Beginning  January  1, 2002, gasohol, as defined in
 6    Section 3-40 of the Use Tax Act.    This  paragraph  (36)  is
 7    exempt from the provisions of Section 2-70.
 8    (Source: P.A.   90-14,  eff.  7-1-97;  90-519,  eff.  6-1-98;
 9    90-552, eff. 12-12-97;  90-605,  eff.  6-30-98;  91-51,  eff.
10    6-30-99;  91-200,  eff. 7-20-99; 91-439, eff. 8-6-99; 91-533,
11    eff. 8-13-99; 91-637, eff.  8-20-99;  91-644,  eff.  8-20-99;
12    revised 9-28-99.)

13        (35 ILCS 120/2-10) (from Ch. 120, par. 441-10)
14        Sec.  2-10.  Rate  of  tax.  Unless otherwise provided in
15    this Section, the tax imposed by this Act is at the  rate  of
16    6.25%  of  gross  receipts  from  sales  of tangible personal
17    property made in the course of business.
18        Beginning on July 1, 2000 and through December 31,  2000,
19    with  respect to motor fuel, as defined in Section 1.1 of the
20    Motor Fuel Tax Law, and gasohol, as defined in  Section  3-40
21    of the Use Tax Act, the tax is imposed at the rate of 1.25%.
22        Within   14   days  after  the  effective  date  of  this
23    amendatory Act of the 91st General Assembly, each retailer of
24    motor fuel and gasohol shall cause the following notice to be
25    posted  in  a  prominently  visible  place  on  each   retail
26    dispensing  device  that  is  used  to dispense motor fuel or
27    gasohol in the State of Illinois:  "As of July 1,  2000,  the
28    State  of  Illinois has eliminated the State's share of sales
29    tax on motor fuel and gasohol through December 31, 2000.  The
30    price  on  this  pump  should  reflect the elimination of the
31    tax."  The notice shall be printed in bold print  on  a  sign
32    that is no smaller than 4 inches by 8 inches.  The sign shall
33    be  clearly  visible to customers.  Any retailer who fails to
 
                            -39-               LRB9204480SMdv
 1    post or maintain a required sign through December 31, 2000 is
 2    guilty of a petty offense for which the fine  shall  be  $500
 3    per day per each retail premises where a violation occurs.
 4        With  respect  to gasohol, as defined in the Use Tax Act,
 5    the tax imposed by this Act applies to 70% of the proceeds of
 6    sales made on or after January 1, 1990, and before January 1,
 7    2002 July 1, 2003, and to 100% of the proceeds of sales  made
 8    thereafter.
 9        With  respect to food for human consumption that is to be
10    consumed off the  premises  where  it  is  sold  (other  than
11    alcoholic  beverages,  soft  drinks,  and  food that has been
12    prepared for  immediate  consumption)  and  prescription  and
13    nonprescription   medicines,   drugs,   medical   appliances,
14    modifications to a motor vehicle for the purpose of rendering
15    it  usable  by  a disabled person, and insulin, urine testing
16    materials, syringes, and needles used by diabetics, for human
17    use, the tax is imposed at the rate of 1%. For  the  purposes
18    of  this  Section, the term "soft drinks" means any complete,
19    finished,   ready-to-use,   non-alcoholic   drink,    whether
20    carbonated  or  not, including but not limited to soda water,
21    cola, fruit juice, vegetable juice, carbonated water, and all
22    other preparations commonly known as soft drinks of  whatever
23    kind  or  description  that  are  contained  in any closed or
24    sealed bottle, can, carton, or container, regardless of size.
25    "Soft drinks" does not include  coffee,  tea,  non-carbonated
26    water,  infant  formula,  milk or milk products as defined in
27    the Grade A Pasteurized Milk and Milk Products Act, or drinks
28    containing 50% or more natural fruit or vegetable juice.
29        Notwithstanding any other provisions of this  Act,  "food
30    for human consumption that is to be consumed off the premises
31    where  it  is  sold" includes all food sold through a vending
32    machine, except  soft  drinks  and  food  products  that  are
33    dispensed  hot  from  a  vending  machine,  regardless of the
34    location of the vending machine.
 
                            -40-               LRB9204480SMdv
 1    (Source: P.A. 90-605, eff.  6-30-98;  90-606,  eff.  6-30-98;
 2    91-51, eff. 6-30-99; 91-872, eff. 7-1-00.)

 3        Section  99.  Effective date.  This Act takes effect upon
 4    becoming law.

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