State of Illinois
92nd General Assembly
Legislation

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92_HB3160

 
                                               LRB9204401SMdv

 1        AN ACT in relation to 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
 
                            -2-                LRB9204401SMdv
 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
 
                            -3-                LRB9204401SMdv
 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.
 
                            -4-                LRB9204401SMdv
 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
 
                            -5-                LRB9204401SMdv
 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
 
                            -6-                LRB9204401SMdv
 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
 
                            -7-                LRB9204401SMdv
 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
 
                            -8-                LRB9204401SMdv
 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
 
                            -9-                LRB9204401SMdv
 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 on January  1,  2002,  rental  containers
26    used  for  shipping  purposes.  This paragraph (31) is exempt
27    from the 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        Section  10.   The  Service  Use  Tax  Act  is amended by
33    changing Section 3-5 as follows:
 
                            -10-               LRB9204401SMdv
 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
 
                            -11-               LRB9204401SMdv
 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
 
                            -12-               LRB9204401SMdv
 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.
 
                            -13-               LRB9204401SMdv
 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
 
                            -14-               LRB9204401SMdv
 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
 
                            -15-               LRB9204401SMdv
 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
 
                            -16-               LRB9204401SMdv
 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 on January  1,  2002,  rental  containers
24    used  for  shipping  purposes.  This paragraph (23) is exempt
25    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        Section 15.  The Service Occupation Tax Act is amended by
31    changing Section 3-5 as follows:

32        (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
 
                            -17-               LRB9204401SMdv
 1        Sec.  3-5.   Exemptions.  The following tangible personal
 2    property is exempt from the tax imposed by this Act:
 3        (1)  Personal property sold by  a  corporation,  society,
 4    association,  foundation, institution, or organization, other
 5    than a limited  liability  company,  that  is  organized  and
 6    operated  as  a  not-for-profit  service  enterprise  for the
 7    benefit of persons 65 years of age or older if  the  personal
 8    property  was not purchased by the enterprise for the purpose
 9    of resale by the enterprise.
10        (2)  Personal  property  purchased  by  a  not-for-profit
11    Illinois county  fair  association  for  use  in  conducting,
12    operating, or promoting the county fair.
13        (3)  Personal  property  purchased  by any not-for-profit
14    arts or cultural  organization  that  establishes,  by  proof
15    required  by  the Department by rule, that it has received an
16    exemption  under Section 501(c)(3) of  the  Internal  Revenue
17    Code  and that is organized and operated for the presentation
18    or support of arts or cultural  programming,  activities,  or
19    services.   These  organizations include, but are not limited
20    to, music and dramatic arts organizations  such  as  symphony
21    orchestras  and  theatrical groups, arts and cultural service
22    organizations,   local    arts    councils,    visual    arts
23    organizations, and media arts organizations.
24        (4)  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        (5)  Graphic  arts  machinery  and  equipment,  including
29    repair  and  replacement  parts,  both  new  and  used,   and
30    including that manufactured on special order or purchased for
31    lease,  certified  by  the purchaser to be used primarily for
32    graphic arts production.
33        (6)  Personal  property  sold  by   a   teacher-sponsored
34    student   organization   affiliated  with  an  elementary  or
 
                            -18-               LRB9204401SMdv
 1    secondary school located in Illinois.
 2        (7)  Farm machinery and equipment,  both  new  and  used,
 3    including  that  manufactured  on special order, certified by
 4    the purchaser to be used primarily for production agriculture
 5    or  State  or  federal   agricultural   programs,   including
 6    individual replacement parts for the machinery and equipment,
 7    including  machinery  and  equipment purchased for lease, and
 8    including implements of husbandry defined in Section 1-130 of
 9    the Illinois Vehicle Code, farm  machinery  and  agricultural
10    chemical  and fertilizer spreaders, and nurse wagons required
11    to be registered under Section 3-809 of the Illinois  Vehicle
12    Code,  but  excluding  other  motor  vehicles  required to be
13    registered under the  Illinois  Vehicle  Code.  Horticultural
14    polyhouses  or  hoop houses used for propagating, growing, or
15    overwintering plants shall be considered farm  machinery  and
16    equipment  under  this item (7). Agricultural chemical tender
17    tanks and dry boxes shall include units sold separately  from
18    a  motor  vehicle  required  to  be  licensed  and units sold
19    mounted on a motor vehicle required to  be  licensed  if  the
20    selling price of the tender is separately stated.
21        Farm  machinery  and  equipment  shall  include precision
22    farming equipment  that  is  installed  or  purchased  to  be
23    installed  on farm machinery and equipment including, but not
24    limited  to,  tractors,   harvesters,   sprayers,   planters,
25    seeders,  or spreaders. Precision farming equipment includes,
26    but is not  limited  to,  soil  testing  sensors,  computers,
27    monitors,  software,  global positioning and mapping systems,
28    and other such equipment.
29        Farm machinery and  equipment  also  includes  computers,
30    sensors,  software,  and  related equipment used primarily in
31    the computer-assisted  operation  of  production  agriculture
32    facilities,  equipment,  and  activities  such  as,  but  not
33    limited  to,  the  collection, monitoring, and correlation of
34    animal and crop data for the purpose  of  formulating  animal
 
                            -19-               LRB9204401SMdv
 1    diets  and  agricultural  chemicals.  This item (7) is exempt
 2    from the provisions of Section 3-55.
 3        (8)  Fuel and petroleum products sold to or  used  by  an
 4    air  common  carrier, certified by the carrier to be used for
 5    consumption, shipment, or  storage  in  the  conduct  of  its
 6    business  as an air common carrier, for a flight destined for
 7    or returning from a location or locations outside the  United
 8    States  without  regard  to  previous  or subsequent domestic
 9    stopovers.
10        (9)  Proceeds of  mandatory  service  charges  separately
11    stated  on  customers' bills for the purchase and consumption
12    of food and beverages, to the extent that the proceeds of the
13    service charge are in fact  turned  over  as  tips  or  as  a
14    substitute for tips to the employees who participate directly
15    in  preparing,  serving,  hosting  or cleaning up the food or
16    beverage function with respect to which the service charge is
17    imposed.
18        (10)  Oil field  exploration,  drilling,  and  production
19    equipment, including (i) rigs and parts of rigs, rotary rigs,
20    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
21    goods, including casing and drill strings,  (iii)  pumps  and
22    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
23    individual  replacement  part  for  oil  field   exploration,
24    drilling,  and  production  equipment, and (vi) machinery and
25    equipment purchased for lease; but excluding  motor  vehicles
26    required to be registered under the Illinois Vehicle Code.
27        (11)  Photoprocessing  machinery and equipment, including
28    repair and replacement parts, both new  and  used,  including
29    that   manufactured   on  special  order,  certified  by  the
30    purchaser to  be  used  primarily  for  photoprocessing,  and
31    including  photoprocessing  machinery and equipment purchased
32    for lease.
33        (12)  Coal  exploration,  mining,   offhighway   hauling,
34    processing, maintenance, and reclamation equipment, including
 
                            -20-               LRB9204401SMdv
 1    replacement  parts  and  equipment,  and  including equipment
 2    purchased for lease, but excluding motor vehicles required to
 3    be registered under the Illinois Vehicle Code.
 4        (13)  Food for human consumption that is to  be  consumed
 5    off  the  premises  where  it  is  sold (other than alcoholic
 6    beverages, soft drinks and food that has  been  prepared  for
 7    immediate  consumption) and prescription and non-prescription
 8    medicines, drugs,  medical  appliances,  and  insulin,  urine
 9    testing  materials,  syringes, and needles used by diabetics,
10    for human use, when purchased for use by a  person  receiving
11    medical assistance under Article 5 of the Illinois Public Aid
12    Code  who  resides  in a licensed long-term care facility, as
13    defined in the Nursing Home Care Act.
14        (14)  Semen used for artificial insemination of livestock
15    for direct agricultural production.
16        (15)  Horses, or interests in horses, registered with and
17    meeting the requirements of any of  the  Arabian  Horse  Club
18    Registry  of  America, Appaloosa Horse Club, American Quarter
19    Horse Association, United  States  Trotting  Association,  or
20    Jockey Club, as appropriate, used for purposes of breeding or
21    racing for prizes.
22        (16)  Computers and communications equipment utilized for
23    any  hospital  purpose  and  equipment used in the diagnosis,
24    analysis, or treatment of hospital patients sold to a  lessor
25    who leases the equipment, under a lease of one year or longer
26    executed  or  in  effect  at  the  time of the purchase, to a
27    hospital  that  has  been  issued  an  active  tax  exemption
28    identification number by the Department under Section  1g  of
29    the Retailers' Occupation Tax Act.
30        (17)  Personal  property  sold to a lessor who leases the
31    property, under a lease of one year or longer executed or  in
32    effect  at  the  time of the purchase, to a governmental body
33    that has been issued an active tax  exemption  identification
34    number  by  the Department under Section 1g of the Retailers'
 
                            -21-               LRB9204401SMdv
 1    Occupation Tax Act.
 2        (18)  Beginning with taxable years  ending  on  or  after
 3    December  31, 1995 and ending with taxable years ending on or
 4    before December 31, 2004, personal property that  is  donated
 5    for  disaster  relief  to  be  used  in  a State or federally
 6    declared disaster area in Illinois or bordering Illinois by a
 7    manufacturer or retailer that is registered in this State  to
 8    a   corporation,   society,   association,   foundation,   or
 9    institution  that  has  been  issued  a  sales  tax exemption
10    identification number by the Department that assists  victims
11    of the disaster who reside within the declared disaster area.
12        (19)  Beginning  with  taxable  years  ending on or after
13    December 31, 1995 and ending with taxable years ending on  or
14    before  December  31, 2004, personal property that is used in
15    the performance of  infrastructure  repairs  in  this  State,
16    including  but  not  limited  to municipal roads and streets,
17    access roads, bridges,  sidewalks,  waste  disposal  systems,
18    water  and  sewer  line  extensions,  water  distribution and
19    purification facilities, storm water drainage  and  retention
20    facilities, and sewage treatment facilities, resulting from a
21    State or federally declared disaster in Illinois or bordering
22    Illinois  when  such  repairs  are  initiated  on  facilities
23    located  in  the declared disaster area within 6 months after
24    the disaster.
25        (20)  Beginning July 1, 1999, game or game birds sold  at
26    a  "game  breeding  and  hunting preserve area" or an "exotic
27    game hunting area" as those terms are used  in  the  Wildlife
28    Code or at a hunting enclosure approved through rules adopted
29    by  the  Department  of Natural Resources.  This paragraph is
30    exempt from the provisions of Section 3-55.
31        (21) (20)  A motor vehicle, as that term  is  defined  in
32    Section  1-146  of the Illinois Vehicle Code, that is donated
33    to  a  corporation,  limited  liability   company,   society,
34    association, foundation, or institution that is determined by
 
                            -22-               LRB9204401SMdv
 1    the  Department  to be organized and operated exclusively for
 2    educational purposes.  For purposes  of  this  exemption,  "a
 3    corporation, limited liability company, society, association,
 4    foundation, or institution organized and operated exclusively
 5    for  educational  purposes"  means  all  tax-supported public
 6    schools, private schools that offer systematic instruction in
 7    useful branches of  learning  by  methods  common  to  public
 8    schools  and  that  compare  favorably  in  their  scope  and
 9    intensity with the course of study presented in tax-supported
10    schools,  and  vocational  or technical schools or institutes
11    organized and operated exclusively to  provide  a  course  of
12    study  of  not  less  than  6  weeks duration and designed to
13    prepare individuals to follow a trade or to pursue a  manual,
14    technical,  mechanical,  industrial,  business, or commercial
15    occupation.
16        (22) (21)  Beginning January 1, 2000,  personal property,
17    including food, purchased through fundraising events for  the
18    benefit  of  a  public  or  private  elementary  or secondary
19    school, a group of those  schools,  or  one  or  more  school
20    districts if the events are sponsored by an entity recognized
21    by  the school district that consists primarily of volunteers
22    and includes parents and teachers  of  the  school  children.
23    This  paragraph  does not apply to fundraising events (i) for
24    the benefit of private home instruction or (ii) for which the
25    fundraising entity purchases the personal  property  sold  at
26    the  events  from  another individual or entity that sold the
27    property for the purpose of resale by the fundraising  entity
28    and  that  profits  from  the sale to the fundraising entity.
29    This paragraph is exempt from the provisions of Section 3-55.
30        (23)  (20)  Beginning  January  1,  2000,  new  or   used
31    automatic  vending  machines  that prepare and serve hot food
32    and beverages, including coffee, soup, and other  items,  and
33    replacement  parts  for  these  machines.   This paragraph is
34    exempt from the provisions of Section 3-55.
 
                            -23-               LRB9204401SMdv
 1        (24)  Beginning on January  1,  2002,  rental  containers
 2    used  for  shipping  purposes.  This paragraph (24) is exempt
 3    from the provisions of Section 3-55.
 4    (Source: P.A. 90-14,  eff.  7-1-97;  90-552,  eff.  12-12-97;
 5    90-605,  eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200, eff.
 6    7-20-99; 91-439, eff. 8-6-99; 91-533, eff.  8-13-99;  91-637,
 7    eff. 8-20-99; 91-644, eff. 8-20-99; revised 9-29-99.)

 8        Section 20.  The Retailers' Occupation Tax Act is amended
 9    by changing Section 2-5 as follows:

10        (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
11        Sec. 2-5.  Exemptions.  Gross receipts from proceeds from
12    the  sale  of  the  following  tangible personal property are
13    exempt from the tax imposed by this Act:
14        (1)  Farm chemicals.
15        (2)  Farm machinery and equipment,  both  new  and  used,
16    including  that  manufactured  on special order, certified by
17    the purchaser to be used primarily for production agriculture
18    or  State  or  federal   agricultural   programs,   including
19    individual replacement parts for the machinery and equipment,
20    including  machinery  and  equipment purchased for lease, and
21    including implements of husbandry defined in Section 1-130 of
22    the Illinois Vehicle Code, farm  machinery  and  agricultural
23    chemical  and fertilizer spreaders, and nurse wagons required
24    to be registered under Section 3-809 of the Illinois  Vehicle
25    Code,  but  excluding  other  motor  vehicles  required to be
26    registered under the  Illinois  Vehicle  Code.  Horticultural
27    polyhouses  or  hoop houses used for propagating, growing, or
28    overwintering plants shall be considered farm  machinery  and
29    equipment  under  this item (2). Agricultural chemical tender
30    tanks and dry boxes shall include units sold separately  from
31    a  motor  vehicle  required  to  be  licensed  and units sold
32    mounted on a motor vehicle required to be  licensed,  if  the
 
                            -24-               LRB9204401SMdv
 1    selling price of the tender is separately stated.
 2        Farm  machinery  and  equipment  shall  include precision
 3    farming equipment  that  is  installed  or  purchased  to  be
 4    installed  on farm machinery and equipment including, but not
 5    limited  to,  tractors,   harvesters,   sprayers,   planters,
 6    seeders,  or spreaders. Precision farming equipment includes,
 7    but is not  limited  to,  soil  testing  sensors,  computers,
 8    monitors,  software,  global positioning and mapping systems,
 9    and other such equipment.
10        Farm machinery and  equipment  also  includes  computers,
11    sensors,  software,  and  related equipment used primarily in
12    the computer-assisted  operation  of  production  agriculture
13    facilities,  equipment,  and  activities  such  as,  but  not
14    limited  to,  the  collection, monitoring, and correlation of
15    animal and crop data for the purpose  of  formulating  animal
16    diets  and  agricultural  chemicals.  This item (7) is exempt
17    from the provisions of Section 2-70.
18        (3)  Distillation machinery and equipment, sold as a unit
19    or kit, assembled or installed by the retailer, certified  by
20    the  user to be used only for the production of ethyl alcohol
21    that will be used for consumption  as  motor  fuel  or  as  a
22    component of motor fuel for the personal use of the user, and
23    not subject to sale or resale.
24        (4)  Graphic  arts  machinery  and  equipment,  including
25    repair   and  replacement  parts,  both  new  and  used,  and
26    including that manufactured on special order or purchased for
27    lease, certified by the purchaser to be  used  primarily  for
28    graphic arts production.
29        (5)  A  motor  vehicle  of  the  first  division, a motor
30    vehicle of the second division that is a self-contained motor
31    vehicle designed or permanently converted to  provide  living
32    quarters  for  recreational,  camping,  or  travel  use, with
33    direct walk through access to the living  quarters  from  the
34    driver's seat, or a motor vehicle of the second division that
 
                            -25-               LRB9204401SMdv
 1    is  of  the van configuration designed for the transportation
 2    of not less than 7 nor more than 16 passengers, as defined in
 3    Section 1-146 of the Illinois Vehicle Code, that is used  for
 4    automobile  renting,  as  defined  in  the Automobile Renting
 5    Occupation and Use Tax Act.
 6        (6)  Personal  property  sold  by   a   teacher-sponsored
 7    student   organization   affiliated  with  an  elementary  or
 8    secondary school located in Illinois.
 9        (7)  Proceeds of that portion of the selling price  of  a
10    passenger car the sale of which is subject to the Replacement
11    Vehicle Tax.
12        (8)  Personal  property  sold  to an Illinois county fair
13    association for use in conducting,  operating,  or  promoting
14    the county fair.
15        (9)  Personal  property  sold to a not-for-profit arts or
16    cultural organization that establishes, by proof required  by
17    the  Department  by  rule,  that it has received an exemption
18    under Section 501(c)(3) of the Internal Revenue Code and that
19    is organized and operated for the presentation or support  of
20    arts or cultural programming, activities, or services.  These
21    organizations  include,  but  are  not  limited to, music and
22    dramatic arts organizations such as symphony  orchestras  and
23    theatrical  groups,  arts and cultural service organizations,
24    local arts councils, visual  arts  organizations,  and  media
25    arts organizations.
26        (10)  Personal  property  sold by a corporation, society,
27    association, foundation, institution, or organization,  other
28    than  a  limited  liability  company,  that  is organized and
29    operated as  a  not-for-profit  service  enterprise  for  the
30    benefit  of  persons 65 years of age or older if the personal
31    property was not purchased by the enterprise for the  purpose
32    of resale by the enterprise.
33        (11)  Personal property sold to a governmental body, to a
34    corporation, society, association, foundation, or institution
 
                            -26-               LRB9204401SMdv
 1    organized and operated exclusively for charitable, religious,
 2    or  educational purposes, or to a not-for-profit corporation,
 3    society,    association,    foundation,    institution,    or
 4    organization that has no compensated  officers  or  employees
 5    and   that  is  organized  and  operated  primarily  for  the
 6    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 identification number issued by the Department.
13        (12)  Personal property sold to interstate  carriers  for
14    hire  for  use as rolling stock moving in interstate commerce
15    or to lessors under leases of one year or longer executed  or
16    in  effect at the time of purchase by interstate carriers for
17    hire for use as rolling stock moving in  interstate  commerce
18    and  equipment  operated  by  a  telecommunications provider,
19    licensed as a common carrier by  the  Federal  Communications
20    Commission,  which  is permanently installed in or affixed to
21    aircraft moving in interstate commerce.
22        (13)  Proceeds from sales to owners, lessors, or shippers
23    of tangible personal property that is utilized by  interstate
24    carriers  for  hire  for  use  as  rolling  stock  moving  in
25    interstate    commerce    and   equipment   operated   by   a
26    telecommunications provider, licensed as a common carrier  by
27    the  Federal  Communications Commission, which is permanently
28    installed in or affixed  to  aircraft  moving  in  interstate
29    commerce.
30        (14)  Machinery  and  equipment  that will be used by the
31    purchaser, or a lessee of the  purchaser,  primarily  in  the
32    process  of  manufacturing  or  assembling  tangible personal
33    property for wholesale or retail sale or lease,  whether  the
34    sale or lease is made directly by the manufacturer or by some
 
                            -27-               LRB9204401SMdv
 1    other  person,  whether the materials used in the process are
 2    owned by the manufacturer or some other  person,  or  whether
 3    the sale or lease is made apart from or as an incident to the
 4    seller's  engaging  in  the  service  occupation of producing
 5    machines, tools,  dies,  jigs,  patterns,  gauges,  or  other
 6    similar  items  of no commercial value on special order for a
 7    particular purchaser.
 8        (15)  Proceeds of mandatory  service  charges  separately
 9    stated  on  customers'  bills for purchase and consumption of
10    food and beverages, to the extent that the  proceeds  of  the
11    service  charge  are  in  fact  turned  over  as tips or as a
12    substitute for tips to the employees who participate directly
13    in preparing, serving, hosting or cleaning  up  the  food  or
14    beverage function with respect to which the service charge is
15    imposed.
16        (16)  Petroleum  products  sold  to  a  purchaser  if the
17    seller is prohibited by federal law from charging tax to  the
18    purchaser.
19        (17)  Tangible personal property sold to a common carrier
20    by rail or motor that receives the physical possession of the
21    property  in  Illinois  and  that transports the property, or
22    shares with another common carrier in the  transportation  of
23    the  property,  out of Illinois on a standard uniform bill of
24    lading showing the seller of the property as the  shipper  or
25    consignor  of the property to a destination outside Illinois,
26    for use outside Illinois.
27        (18)  Legal tender,  currency,  medallions,  or  gold  or
28    silver   coinage   issued  by  the  State  of  Illinois,  the
29    government of the United States of America, or the government
30    of any foreign country, and bullion.
31        (19)  Oil field  exploration,  drilling,  and  production
32    equipment, including (i) rigs and parts of rigs, rotary rigs,
33    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
34    goods, including casing and drill strings,  (iii)  pumps  and
 
                            -28-               LRB9204401SMdv
 1    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
 2    individual  replacement  part  for  oil  field   exploration,
 3    drilling,  and  production  equipment, and (vi) machinery and
 4    equipment purchased for lease; but excluding  motor  vehicles
 5    required to be registered under the Illinois Vehicle Code.
 6        (20)  Photoprocessing  machinery and equipment, including
 7    repair and replacement parts, both new  and  used,  including
 8    that   manufactured   on  special  order,  certified  by  the
 9    purchaser to  be  used  primarily  for  photoprocessing,  and
10    including  photoprocessing  machinery and equipment purchased
11    for lease.
12        (21)  Coal  exploration,  mining,   offhighway   hauling,
13    processing, maintenance, and reclamation equipment, including
14    replacement  parts  and  equipment,  and  including equipment
15    purchased for lease, but excluding motor vehicles required to
16    be registered under the Illinois Vehicle Code.
17        (22)  Fuel and petroleum products sold to or used  by  an
18    air  carrier,  certified  by  the  carrier  to  be  used  for
19    consumption,  shipment,  or  storage  in  the  conduct of its
20    business as an air common carrier, for a flight destined  for
21    or  returning from a location or locations outside the United
22    States without regard  to  previous  or  subsequent  domestic
23    stopovers.
24        (23)  A  transaction  in  which  the  purchase  order  is
25    received  by  a  florist who is located outside Illinois, but
26    who has a florist located in Illinois deliver the property to
27    the purchaser or the purchaser's donee in Illinois.
28        (24)  Fuel consumed or used in the  operation  of  ships,
29    barges,  or  vessels  that  are  used primarily in or for the
30    transportation of property or the conveyance of  persons  for
31    hire  on  rivers  bordering  on  this  State  if  the fuel is
32    delivered by the seller to the purchaser's  barge,  ship,  or
33    vessel while it is afloat upon that bordering river.
34        (25)  A motor vehicle sold in this State to a nonresident
 
                            -29-               LRB9204401SMdv
 1    even though the motor vehicle is delivered to the nonresident
 2    in  this  State,  if the motor vehicle is not to be titled in
 3    this State, and if a driveaway decal permit is issued to  the
 4    motor  vehicle  as  provided in Section 3-603 of the Illinois
 5    Vehicle Code or if  the  nonresident  purchaser  has  vehicle
 6    registration  plates  to  transfer  to the motor vehicle upon
 7    returning to his or her home  state.   The  issuance  of  the
 8    driveaway   decal   permit   or   having   the   out-of-state
 9    registration plates to be transferred is prima facie evidence
10    that the motor vehicle will not be titled in this State.
11        (26)  Semen used for artificial insemination of livestock
12    for direct agricultural production.
13        (27)  Horses, or interests in horses, registered with and
14    meeting  the  requirements  of  any of the Arabian Horse Club
15    Registry of America, Appaloosa Horse Club,  American  Quarter
16    Horse  Association,  United  States  Trotting Association, or
17    Jockey Club, as appropriate, used for purposes of breeding or
18    racing for prizes.
19        (28)  Computers and communications equipment utilized for
20    any hospital purpose and equipment  used  in  the  diagnosis,
21    analysis,  or treatment of hospital patients sold to a lessor
22    who leases the equipment, under a lease of one year or longer
23    executed or in effect at the  time  of  the  purchase,  to  a
24    hospital  that  has  been  issued  an  active  tax  exemption
25    identification  number  by the Department under Section 1g of
26    this Act.
27        (29)  Personal property sold to a lessor who  leases  the
28    property,  under a lease of one year or longer executed or in
29    effect at the time of the purchase, to  a  governmental  body
30    that  has  been issued an active tax exemption identification
31    number by the Department under Section 1g of this Act.
32        (30)  Beginning with taxable years  ending  on  or  after
33    December  31, 1995 and ending with taxable years ending on or
34    before December 31, 2004, personal property that  is  donated
 
                            -30-               LRB9204401SMdv
 1    for  disaster  relief  to  be  used  in  a State or federally
 2    declared disaster area in Illinois or bordering Illinois by a
 3    manufacturer or retailer that is registered in this State  to
 4    a   corporation,   society,   association,   foundation,   or
 5    institution  that  has  been  issued  a  sales  tax exemption
 6    identification number by the Department that assists  victims
 7    of the disaster who reside within the declared disaster area.
 8        (31)  Beginning  with  taxable  years  ending on or after
 9    December 31, 1995 and ending with taxable years ending on  or
10    before  December  31, 2004, personal property that is used in
11    the performance of  infrastructure  repairs  in  this  State,
12    including  but  not  limited  to municipal roads and streets,
13    access roads, bridges,  sidewalks,  waste  disposal  systems,
14    water  and  sewer  line  extensions,  water  distribution and
15    purification facilities, storm water drainage  and  retention
16    facilities, and sewage treatment facilities, resulting from a
17    State or federally declared disaster in Illinois or bordering
18    Illinois  when  such  repairs  are  initiated  on  facilities
19    located  in  the declared disaster area within 6 months after
20    the disaster.
21        (32)  Beginning July 1, 1999, game or game birds sold  at
22    a  "game  breeding  and  hunting preserve area" or an "exotic
23    game hunting area" as those terms are used  in  the  Wildlife
24    Code or at a hunting enclosure approved through rules adopted
25    by  the  Department  of Natural Resources.  This paragraph is
26    exempt from the provisions of Section 2-70.
27        (33) (32)  A motor vehicle, as that term  is  defined  in
28    Section  1-146  of the Illinois Vehicle Code, that is donated
29    to  a  corporation,  limited  liability   company,   society,
30    association, foundation, or institution that is determined by
31    the  Department  to be organized and operated exclusively for
32    educational purposes.  For purposes  of  this  exemption,  "a
33    corporation, limited liability company, society, association,
34    foundation, or institution organized and operated exclusively
 
                            -31-               LRB9204401SMdv
 1    for  educational  purposes"  means  all  tax-supported public
 2    schools, private schools that offer systematic instruction in
 3    useful branches of  learning  by  methods  common  to  public
 4    schools  and  that  compare  favorably  in  their  scope  and
 5    intensity with the course of study presented in tax-supported
 6    schools,  and  vocational  or technical schools or institutes
 7    organized and operated exclusively to  provide  a  course  of
 8    study  of  not  less  than  6  weeks duration and designed to
 9    prepare individuals to follow a trade or to pursue a  manual,
10    technical,  mechanical,  industrial,  business, or commercial
11    occupation.
12        (34) (33)  Beginning January 1, 2000,  personal property,
13    including food, purchased through fundraising events for  the
14    benefit  of  a  public  or  private  elementary  or secondary
15    school, a group of those  schools,  or  one  or  more  school
16    districts if the events are sponsored by an entity recognized
17    by  the school district that consists primarily of volunteers
18    and includes parents and teachers  of  the  school  children.
19    This  paragraph  does not apply to fundraising events (i) for
20    the benefit of private home instruction or (ii) for which the
21    fundraising entity purchases the personal  property  sold  at
22    the  events  from  another individual or entity that sold the
23    property for the purpose of resale by the fundraising  entity
24    and  that  profits  from  the sale to the fundraising entity.
25    This paragraph is exempt from the provisions of Section 2-70.
26        (35)  (32)  Beginning  January  1,  2000,  new  or   used
27    automatic  vending  machines  that prepare and serve hot food
28    and beverages, including coffee, soup, and other  items,  and
29    replacement  parts  for  these  machines.   This paragraph is
30    exempt from the provisions of Section 2-70.
31        (36)  Beginning on January  1,  2002,  rental  containers
32    used  for  shipping  purposes.  This paragraph (36) is exempt
33    from the provisions of Section 2-70.
34    (Source: P.A.  90-14,  eff.  7-1-97;  90-519,  eff.   6-1-98;
 
                            -32-               LRB9204401SMdv
 1    90-552,  eff.  12-12-97;  90-605,  eff.  6-30-98; 91-51, eff.
 2    6-30-99; 91-200, eff. 7-20-99; 91-439, eff.  8-6-99;  91-533,
 3    eff.  8-13-99;  91-637,  eff.  8-20-99; 91-644, eff. 8-20-99;
 4    revised 9-28-99.)

 5        Section 99.  Effective date.  This Act takes effect  upon
 6    becoming law.

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