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92_HB3709 LRB9209999SMdvA 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 3-10 as follows: 6 (35 ILCS 105/3-10) (from Ch. 120, par. 439.3-10) 7 Sec. 3-10. Rate of tax. Unless otherwise provided in 8 this Section, the tax imposed by this Act is at the rate of 9 6.25% of either the selling price or the fair market value, 10 if any, of the tangible personal property. In all cases 11 where property functionally used or consumed is the same as 12 the property that was purchased at retail, then the tax is 13 imposed on the selling price of the property. In all cases 14 where property functionally used or consumed is a by-product 15 or waste product that has been refined, manufactured, or 16 produced from property purchased at retail, then the tax is 17 imposed on the lower of the fair market value, if any, of the 18 specific property so used in this State or on the selling 19 price of the property purchased at retail. For purposes of 20 this Section "fair market value" means the price at which 21 property would change hands between a willing buyer and a 22 willing seller, neither being under any compulsion to buy or 23 sell and both having reasonable knowledge of the relevant 24 facts. The fair market value shall be established by Illinois 25 sales by the taxpayer of the same property as that 26 functionally used or consumed, or if there are no such sales 27 by the taxpayer, then comparable sales or purchases of 28 property of like kind and character in Illinois. 29 Beginning on July 1, 2000 and through December 31, 2000, 30 with respect to motor fuel, as defined in Section 1.1 of the 31 Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 -2- LRB9209999SMdvA 1 of the Use Tax Act, the tax is imposed at the rate of 1.25%. 2 With respect to gasohol, the tax imposed by this Act 3 applies to 70% of the proceeds of sales made on or after 4 January 1, 1990, and before January 1, 2008July 1, 2003, and 5 to 100% of the proceeds of sales made thereafter. 6 With respect to food for human consumption that is to be 7 consumed off the premises where it is sold (other than 8 alcoholic beverages, soft drinks, and food that has been 9 prepared for immediate consumption) and prescription and 10 nonprescription medicines, drugs, medical appliances, 11 modifications to a motor vehicle for the purpose of rendering 12 it usable by a disabled person, and insulin, urine testing 13 materials, syringes, and needles used by diabetics, for human 14 use, the tax is imposed at the rate of 1%. For the purposes 15 of this Section, the term "soft drinks" means any complete, 16 finished, ready-to-use, non-alcoholic drink, whether 17 carbonated or not, including but not limited to soda water, 18 cola, fruit juice, vegetable juice, carbonated water, and all 19 other preparations commonly known as soft drinks of whatever 20 kind or description that are contained in any closed or 21 sealed bottle, can, carton, or container, regardless of size. 22 "Soft drinks" does not include coffee, tea, non-carbonated 23 water, infant formula, milk or milk products as defined in 24 the Grade A Pasteurized Milk and Milk Products Act, or drinks 25 containing 50% or more natural fruit or vegetable juice. 26 Notwithstanding any other provisions of this Act, "food 27 for human consumption that is to be consumed off the premises 28 where it is sold" includes all food sold through a vending 29 machine, except soft drinks and food products that are 30 dispensed hot from a vending machine, regardless of the 31 location of the vending machine. 32 If the property that is purchased at retail from a 33 retailer is acquired outside Illinois and used outside 34 Illinois before being brought to Illinois for use here and is -3- LRB9209999SMdvA 1 taxable under this Act, the "selling price" on which the tax 2 is computed shall be reduced by an amount that represents a 3 reasonable allowance for depreciation for the period of prior 4 out-of-state use. 5 (Source: P.A. 90-605, eff. 6-30-98; 90-606, eff. 6-30-98; 6 91-51, eff. 6-30-99; 91-872, eff. 7-1-00.) 7 Section 10. The Service Use Tax Act is amended by 8 changing Section 3-10 as follows: 9 (35 ILCS 110/3-10) (from Ch. 120, par. 439.33-10) 10 Sec. 3-10. Rate of tax. Unless otherwise provided in 11 this Section, the tax imposed by this Act is at the rate of 12 6.25% of the selling price of tangible personal property 13 transferred as an incident to the sale of service, but, for 14 the purpose of computing this tax, in no event shall the 15 selling price be less than the cost price of the property to 16 the serviceman. 17 Beginning on July 1, 2000 and through December 31, 2000, 18 with respect to motor fuel, as defined in Section 1.1 of the 19 Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 20 of the Use Tax Act, the tax is imposed at the rate of 1.25%. 21 With respect to gasohol, as defined in the Use Tax Act, 22 the tax imposed by this Act applies to 70% of the selling 23 price of property transferred as an incident to the sale of 24 service on or after January 1, 1990, and before January 1, 25 2008July 1, 2003, and to 100% of the selling price 26 thereafter. 27 At the election of any registered serviceman made for 28 each fiscal year, sales of service in which the aggregate 29 annual cost price of tangible personal property transferred 30 as an incident to the sales of service is less than 35%, or 31 75% in the case of servicemen transferring prescription drugs 32 or servicemen engaged in graphic arts production, of the -4- LRB9209999SMdvA 1 aggregate annual total gross receipts from all sales of 2 service, the tax imposed by this Act shall be based on the 3 serviceman's cost price of the tangible personal property 4 transferred as an incident to the sale of those services. 5 The tax shall be imposed at the rate of 1% on food 6 prepared for immediate consumption and transferred incident 7 to a sale of service subject to this Act or the Service 8 Occupation Tax Act by an entity licensed under the Hospital 9 Licensing Act, the Nursing Home Care Act, or the Child Care 10 Act of 1969. The tax shall also be imposed at the rate of 1% 11 on food for human consumption that is to be consumed off the 12 premises where it is sold (other than alcoholic beverages, 13 soft drinks, and food that has been prepared for immediate 14 consumption and is not otherwise included in this paragraph) 15 and prescription and nonprescription medicines, drugs, 16 medical appliances, modifications to a motor vehicle for the 17 purpose of rendering it usable by a disabled person, and 18 insulin, urine testing materials, syringes, and needles used 19 by diabetics, for human use. For the purposes of this 20 Section, the term "soft drinks" means any complete, finished, 21 ready-to-use, non-alcoholic drink, whether carbonated or not, 22 including but not limited to soda water, cola, fruit juice, 23 vegetable juice, carbonated water, and all other preparations 24 commonly known as soft drinks of whatever kind or description 25 that are contained in any closed or sealed bottle, can, 26 carton, or container, regardless of size. "Soft drinks" does 27 not include coffee, tea, non-carbonated water, infant 28 formula, milk or milk products as defined in the Grade A 29 Pasteurized Milk and Milk Products Act, or drinks containing 30 50% or more natural fruit or vegetable juice. 31 Notwithstanding any other provisions of this Act, "food 32 for human consumption that is to be consumed off the premises 33 where it is sold" includes all food sold through a vending 34 machine, except soft drinks and food products that are -5- LRB9209999SMdvA 1 dispensed hot from a vending machine, regardless of the 2 location of the vending machine. 3 If the property that is acquired from a serviceman is 4 acquired outside Illinois and used outside Illinois before 5 being brought to Illinois for use here and is taxable under 6 this Act, the "selling price" on which the tax is computed 7 shall be reduced by an amount that represents a reasonable 8 allowance for depreciation for the period of prior 9 out-of-state use. 10 (Source: P.A. 90-605, eff. 6-30-98; 90-606, eff. 6-30-98; 11 91-51, eff. 6-30-99; 91-541, eff. 8-13-99; 91-872, eff. 12 7-1-00.) 13 Section 15. The Service Occupation Tax Act is amended by 14 changing Section 3-10 as follows: 15 (35 ILCS 115/3-10) (from Ch. 120, par. 439.103-10) 16 Sec. 3-10. Rate of tax. Unless otherwise provided in 17 this Section, the tax imposed by this Act is at the rate of 18 6.25% of the "selling price", as defined in Section 2 of the 19 Service Use Tax Act, of the tangible personal property. For 20 the purpose of computing this tax, in no event shall the 21 "selling price" be less than the cost price to the serviceman 22 of the tangible personal property transferred. The selling 23 price of each item of tangible personal property transferred 24 as an incident of a sale of service may be shown as a 25 distinct and separate item on the serviceman's billing to the 26 service customer. If the selling price is not so shown, the 27 selling price of the tangible personal property is deemed to 28 be 50% of the serviceman's entire billing to the service 29 customer. When, however, a serviceman contracts to design, 30 develop, and produce special order machinery or equipment, 31 the tax imposed by this Act shall be based on the 32 serviceman's cost price of the tangible personal property -6- LRB9209999SMdvA 1 transferred incident to the completion of the contract. 2 Beginning on July 1, 2000 and through December 31, 2000, 3 with respect to motor fuel, as defined in Section 1.1 of the 4 Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 5 of the Use Tax Act, the tax is imposed at the rate of 1.25%. 6 With respect to gasohol, as defined in the Use Tax Act, 7 the tax imposed by this Act shall apply to 70% of the cost 8 price of property transferred as an incident to the sale of 9 service on or after January 1, 1990, and before January 1, 10 2008July 1, 2003, and to 100% of the cost price thereafter. 11 At the election of any registered serviceman made for 12 each fiscal year, sales of service in which the aggregate 13 annual cost price of tangible personal property transferred 14 as an incident to the sales of service is less than 35%, or 15 75% in the case of servicemen transferring prescription drugs 16 or servicemen engaged in graphic arts production, of the 17 aggregate annual total gross receipts from all sales of 18 service, the tax imposed by this Act shall be based on the 19 serviceman's cost price of the tangible personal property 20 transferred incident to the sale of those services. 21 The tax shall be imposed at the rate of 1% on food 22 prepared for immediate consumption and transferred incident 23 to a sale of service subject to this Act or the Service 24 Occupation Tax Act by an entity licensed under the Hospital 25 Licensing Act, the Nursing Home Care Act, or the Child Care 26 Act of 1969. The tax shall also be imposed at the rate of 1% 27 on food for human consumption that is to be consumed off the 28 premises where it is sold (other than alcoholic beverages, 29 soft drinks, and food that has been prepared for immediate 30 consumption and is not otherwise included in this paragraph) 31 and prescription and nonprescription medicines, drugs, 32 medical appliances, modifications to a motor vehicle for the 33 purpose of rendering it usable by a disabled person, and 34 insulin, urine testing materials, syringes, and needles used -7- LRB9209999SMdvA 1 by diabetics, for human use. For the purposes of this 2 Section, the term "soft drinks" means any complete, finished, 3 ready-to-use, non-alcoholic drink, whether carbonated or not, 4 including but not limited to soda water, cola, fruit juice, 5 vegetable juice, carbonated water, and all other preparations 6 commonly known as soft drinks of whatever kind or description 7 that are contained in any closed or sealed can, carton, or 8 container, regardless of size. "Soft drinks" does not 9 include coffee, tea, non-carbonated water, infant formula, 10 milk or milk products as defined in the Grade A Pasteurized 11 Milk and Milk Products Act, or drinks containing 50% or more 12 natural fruit or vegetable juice. 13 Notwithstanding any other provisions of this Act, "food 14 for human consumption that is to be consumed off the premises 15 where it is sold" includes all food sold through a vending 16 machine, except soft drinks and food products that are 17 dispensed hot from a vending machine, regardless of the 18 location of the vending machine. 19 (Source: P.A. 90-605, eff. 6-30-98; 90-606, eff. 6-30-98; 20 91-51, 6-30-99; 91-541, eff. 8-13-99; 91-872, eff. 7-1-00.) 21 Section 20. The Retailers' Occupation Tax Act is amended 22 by changing Section 2-10 as follows: 23 (35 ILCS 120/2-10) (from Ch. 120, par. 441-10) 24 Sec. 2-10. Rate of tax. Unless otherwise provided in 25 this Section, the tax imposed by this Act is at the rate of 26 6.25% of gross receipts from sales of tangible personal 27 property made in the course of business. 28 Beginning on July 1, 2000 and through December 31, 2000, 29 with respect to motor fuel, as defined in Section 1.1 of the 30 Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 31 of the Use Tax Act, the tax is imposed at the rate of 1.25%. 32 Within 14 days after the effective date of this -8- LRB9209999SMdvA 1 amendatory Act of the 91st General Assembly, each retailer of 2 motor fuel and gasohol shall cause the following notice to be 3 posted in a prominently visible place on each retail 4 dispensing device that is used to dispense motor fuel or 5 gasohol in the State of Illinois: "As of July 1, 2000, the 6 State of Illinois has eliminated the State's share of sales 7 tax on motor fuel and gasohol through December 31, 2000. The 8 price on this pump should reflect the elimination of the 9 tax." The notice shall be printed in bold print on a sign 10 that is no smaller than 4 inches by 8 inches. The sign shall 11 be clearly visible to customers. Any retailer who fails to 12 post or maintain a required sign through December 31, 2000 is 13 guilty of a petty offense for which the fine shall be $500 14 per day per each retail premises where a violation occurs. 15 With respect to gasohol, as defined in the Use Tax Act, 16 the tax imposed by this Act applies to 70% of the proceeds of 17 sales made on or after January 1, 1990, and before January 1, 18 2008July 1, 2003, and to 100% of the proceeds of sales made 19 thereafter. 20 With respect to food for human consumption that is to be 21 consumed off the premises where it is sold (other than 22 alcoholic beverages, soft drinks, and food that has been 23 prepared for immediate consumption) and prescription and 24 nonprescription medicines, drugs, medical appliances, 25 modifications to a motor vehicle for the purpose of rendering 26 it usable by a disabled person, and insulin, urine testing 27 materials, syringes, and needles used by diabetics, for human 28 use, the tax is imposed at the rate of 1%. For the purposes 29 of this Section, the term "soft drinks" means any complete, 30 finished, ready-to-use, non-alcoholic drink, whether 31 carbonated or not, including but not limited to soda water, 32 cola, fruit juice, vegetable juice, carbonated water, and all 33 other preparations commonly known as soft drinks of whatever 34 kind or description that are contained in any closed or -9- LRB9209999SMdvA 1 sealed bottle, can, carton, or container, regardless of size. 2 "Soft drinks" does not include coffee, tea, non-carbonated 3 water, infant formula, milk or milk products as defined in 4 the Grade A Pasteurized Milk and Milk Products Act, or drinks 5 containing 50% or more natural fruit or vegetable juice. 6 Notwithstanding any other provisions of this Act, "food 7 for human consumption that is to be consumed off the premises 8 where it is sold" includes all food sold through a vending 9 machine, except soft drinks and food products that are 10 dispensed hot from a vending machine, regardless of the 11 location of the vending machine. 12 (Source: P.A. 90-605, eff. 6-30-98; 90-606, eff. 6-30-98; 13 91-51, eff. 6-30-99; 91-872, eff. 7-1-00.) 14 Section 99. Effective date. This Act takes effect upon 15 becoming law.