State of Illinois
92nd General Assembly
Legislation

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92_SB0854eng

 
SB854 Engrossed                                LRB9204999SMdv

 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 primarily for the  presentation  or
24    support  of  arts  or  cultural  programming,  activities, or
25    services.  These organizations include, but are  not  limited
26    to,  music  and  dramatic arts organizations such as symphony
27    orchestras and theatrical groups, arts and  cultural  service
28    organizations,    local    arts    councils,    visual   arts
29    organizations, and media arts organizations. On and after the
30    effective date of this amendatory Act  of  the  92nd  General
31    Assembly,  however,  an  entity  otherwise  eligible for this
 
SB854 Engrossed             -2-                LRB9204999SMdv
 1    exemption shall not make tax-free purchases unless it has  an
 2    active identification number issued by the Department.
 3        (4)  Personal  property purchased by a governmental body,
 4    by  a  corporation,  society,  association,  foundation,   or
 5    institution    organized   and   operated   exclusively   for
 6    charitable, religious,  or  educational  purposes,  or  by  a
 7    not-for-profit corporation, society, association, foundation,
 8    institution, or organization that has no compensated officers
 9    or employees and that is organized and operated primarily for
10    the recreation of persons 55 years of age or older. A limited
11    liability  company  may  qualify for the exemption under this
12    paragraph only if the limited liability company is  organized
13    and  operated  exclusively  for  educational purposes. On and
14    after July 1, 1987, however, no entity otherwise eligible for
15    this exemption shall make tax-free purchases unless it has an
16    active  exemption  identification  number   issued   by   the
17    Department.
18        (5)  A passenger car that is a replacement vehicle to the
19    extent  that  the purchase price of the car is subject to the
20    Replacement Vehicle Tax.
21        (6)  Graphic  arts  machinery  and  equipment,  including
22    repair  and  replacement  parts,  both  new  and  used,   and
23    including  that  manufactured  on special order, certified by
24    the  purchaser  to  be  used  primarily  for   graphic   arts
25    production,  and  including machinery and equipment purchased
26    for lease.
27        (7)  Farm chemicals.
28        (8)  Legal  tender,  currency,  medallions,  or  gold  or
29    silver  coinage  issued  by  the  State  of   Illinois,   the
30    government of the United States of America, or the government
31    of any foreign country, and bullion.
32        (9)  Personal property purchased from a teacher-sponsored
33    student   organization   affiliated  with  an  elementary  or
34    secondary school located in Illinois.
 
SB854 Engrossed             -3-                LRB9204999SMdv
 1        (10)  A motor vehicle of  the  first  division,  a  motor
 2    vehicle of the second division that is a self-contained motor
 3    vehicle  designed  or permanently converted to provide living
 4    quarters for  recreational,  camping,  or  travel  use,  with
 5    direct  walk through to the living quarters from the driver's
 6    seat, or a motor vehicle of the second division  that  is  of
 7    the  van configuration designed for the transportation of not
 8    less than 7 nor  more  than  16  passengers,  as  defined  in
 9    Section  1-146 of the Illinois Vehicle Code, that is used for
10    automobile renting, as  defined  in  the  Automobile  Renting
11    Occupation and Use Tax Act.
12        (11)  Farm  machinery  and  equipment, both new and used,
13    including that manufactured on special  order,  certified  by
14    the purchaser to be used primarily for production agriculture
15    or   State   or   federal  agricultural  programs,  including
16    individual replacement parts for the machinery and equipment,
17    including machinery and equipment purchased  for  lease,  and
18    including implements of husbandry defined in Section 1-130 of
19    the  Illinois  Vehicle  Code, farm machinery and agricultural
20    chemical and fertilizer spreaders, and nurse wagons  required
21    to  be registered under Section 3-809 of the Illinois Vehicle
22    Code, but excluding  other  motor  vehicles  required  to  be
23    registered  under  the  Illinois  Vehicle Code. Horticultural
24    polyhouses or hoop houses used for propagating,  growing,  or
25    overwintering  plants  shall be considered farm machinery and
26    equipment under this item (11). Agricultural chemical  tender
27    tanks  and dry boxes shall include units sold separately from
28    a motor vehicle  required  to  be  licensed  and  units  sold
29    mounted  on  a  motor  vehicle required to be licensed if the
30    selling price of the tender is separately stated.
31        Farm machinery  and  equipment  shall  include  precision
32    farming  equipment  that  is  installed  or  purchased  to be
33    installed on farm machinery and equipment including, but  not
34    limited   to,   tractors,   harvesters,  sprayers,  planters,
 
SB854 Engrossed             -4-                LRB9204999SMdv
 1    seeders, or spreaders. Precision farming equipment  includes,
 2    but  is  not  limited  to,  soil  testing sensors, computers,
 3    monitors, software, global positioning and  mapping  systems,
 4    and other such equipment.
 5        Farm  machinery  and  equipment  also includes computers,
 6    sensors, software, and related equipment  used  primarily  in
 7    the  computer-assisted  operation  of  production agriculture
 8    facilities,  equipment,  and  activities  such  as,  but  not
 9    limited to, the collection, monitoring,  and  correlation  of
10    animal  and  crop  data for the purpose of formulating animal
11    diets and agricultural chemicals.  This item (11)  is  exempt
12    from the provisions of Section 3-90.
13        (12)  Fuel  and  petroleum products sold to or used by an
14    air common carrier, certified by the carrier to be  used  for
15    consumption,  shipment,  or  storage  in  the  conduct of its
16    business as an air common carrier, for a flight destined  for
17    or  returning from a location or locations outside the United
18    States without regard  to  previous  or  subsequent  domestic
19    stopovers.
20        (13)  Proceeds  of  mandatory  service charges separately
21    stated on customers' bills for the purchase  and  consumption
22    of food and beverages purchased at retail from a retailer, to
23    the  extent  that  the  proceeds of the service charge are in
24    fact turned over as tips or as a substitute for tips  to  the
25    employees  who  participate  directly  in preparing, serving,
26    hosting or cleaning up the food  or  beverage  function  with
27    respect to which the service charge is imposed.
28        (14)  Oil  field  exploration,  drilling,  and production
29    equipment, including (i) rigs and parts of rigs, rotary rigs,
30    cable tool rigs, and workover rigs,  (ii)  pipe  and  tubular
31    goods,  including  casing  and drill strings, (iii) pumps and
32    pump-jack units, (iv) storage tanks and flow lines,  (v)  any
33    individual   replacement  part  for  oil  field  exploration,
34    drilling, and production equipment, and  (vi)  machinery  and
 
SB854 Engrossed             -5-                LRB9204999SMdv
 1    equipment  purchased  for lease; but excluding motor vehicles
 2    required to be registered under the Illinois Vehicle Code.
 3        (15)  Photoprocessing machinery and equipment,  including
 4    repair  and  replacement  parts, both new and used, including
 5    that  manufactured  on  special  order,  certified   by   the
 6    purchaser  to  be  used  primarily  for  photoprocessing, and
 7    including photoprocessing machinery and  equipment  purchased
 8    for lease.
 9        (16)  Coal   exploration,   mining,  offhighway  hauling,
10    processing, maintenance, and reclamation equipment, including
11    replacement parts  and  equipment,  and  including  equipment
12    purchased for lease, but excluding motor vehicles required to
13    be registered under the Illinois Vehicle Code.
14        (17)  Distillation  machinery  and  equipment,  sold as a
15    unit  or  kit,  assembled  or  installed  by  the   retailer,
16    certified  by  the user to be used only for the production of
17    ethyl alcohol that will be used for consumption as motor fuel
18    or as a component of motor fuel for the personal use  of  the
19    user, and not subject to sale or resale.
20        (18)  Manufacturing    and   assembling   machinery   and
21    equipment used primarily in the process of  manufacturing  or
22    assembling tangible personal property for wholesale or retail
23    sale or lease, whether that sale or lease is made directly by
24    the  manufacturer  or  by  some  other  person,  whether  the
25    materials  used  in the process are owned by the manufacturer
26    or some other person, or whether that sale or lease  is  made
27    apart  from or as an incident to the seller's engaging in the
28    service occupation of producing machines, tools, dies,  jigs,
29    patterns,  gauges,  or  other  similar items of no commercial
30    value on special order for a particular purchaser.
31        (19)  Personal  property  delivered  to  a  purchaser  or
32    purchaser's donee inside Illinois when the purchase order for
33    that personal property was  received  by  a  florist  located
34    outside  Illinois  who  has a florist located inside Illinois
 
SB854 Engrossed             -6-                LRB9204999SMdv
 1    deliver the personal property.
 2        (20)  Semen used for artificial insemination of livestock
 3    for direct agricultural production.
 4        (21)  Horses, or interests in horses, registered with and
 5    meeting the requirements of any of  the  Arabian  Horse  Club
 6    Registry  of  America, Appaloosa Horse Club, American Quarter
 7    Horse Association, United  States  Trotting  Association,  or
 8    Jockey Club, as appropriate, used for purposes of breeding or
 9    racing for prizes.
10        (22)  Computers and communications equipment utilized for
11    any  hospital  purpose  and  equipment used in the diagnosis,
12    analysis, or treatment of hospital patients  purchased  by  a
13    lessor who leases the equipment, under a lease of one year or
14    longer  executed  or  in  effect at the time the lessor would
15    otherwise be subject to the tax imposed by  this  Act,  to  a
16    hospital    that  has  been  issued  an  active tax exemption
17    identification number by the Department under Section  1g  of
18    the  Retailers'  Occupation  Tax  Act.   If  the equipment is
19    leased in a manner that does not qualify for  this  exemption
20    or  is  used in any other non-exempt manner, the lessor shall
21    be liable for the tax imposed under this Act or  the  Service
22    Use  Tax  Act,  as  the case may be, based on the fair market
23    value of the property at  the  time  the  non-qualifying  use
24    occurs.   No  lessor  shall  collect or attempt to collect an
25    amount (however designated) that purports to  reimburse  that
26    lessor for the tax imposed by this Act or the Service Use Tax
27    Act,  as the case may be, if the tax has not been paid by the
28    lessor.  If a lessor improperly collects any such amount from
29    the lessee, the lessee shall have a legal right  to  claim  a
30    refund  of  that  amount  from the lessor.  If, however, that
31    amount is not refunded to the  lessee  for  any  reason,  the
32    lessor is liable to pay that amount to the Department.
33        (23)  Personal  property purchased by a lessor who leases
34    the property, under a lease of  one year or  longer  executed
 
SB854 Engrossed             -7-                LRB9204999SMdv
 1    or  in  effect  at  the  time  the  lessor would otherwise be
 2    subject to the tax imposed by this  Act,  to  a  governmental
 3    body  that  has  been  issued  an  active sales tax exemption
 4    identification number by the Department under Section  1g  of
 5    the  Retailers' Occupation Tax Act. If the property is leased
 6    in a manner that does not qualify for this exemption or  used
 7    in  any  other  non-exempt manner, the lessor shall be liable
 8    for the tax imposed under this Act or  the  Service  Use  Tax
 9    Act,  as  the  case may be, based on the fair market value of
10    the property at the time the non-qualifying use  occurs.   No
11    lessor shall collect or attempt to collect an amount (however
12    designated)  that  purports  to reimburse that lessor for the
13    tax imposed by this Act or the Service Use Tax  Act,  as  the
14    case  may be, if the tax has not been paid by the lessor.  If
15    a lessor improperly collects any such amount from the lessee,
16    the lessee shall have a legal right to claim a refund of that
17    amount from the lessor.  If,  however,  that  amount  is  not
18    refunded  to  the lessee for any reason, the lessor is liable
19    to pay that amount to the Department.
20        (24)  Beginning with taxable years  ending  on  or  after
21    December  31, 1995 and ending with taxable years ending on or
22    before December 31, 2004, personal property that  is  donated
23    for  disaster  relief  to  be  used  in  a State or federally
24    declared disaster area in Illinois or bordering Illinois by a
25    manufacturer or retailer that is registered in this State  to
26    a   corporation,   society,   association,   foundation,   or
27    institution  that  has  been  issued  a  sales  tax exemption
28    identification number by the Department that assists  victims
29    of the disaster who reside within the declared disaster area.
30        (25)  Beginning  with  taxable  years  ending on or after
31    December 31, 1995 and ending with taxable years ending on  or
32    before  December  31, 2004, personal property that is used in
33    the performance of  infrastructure  repairs  in  this  State,
34    including  but  not  limited  to municipal roads and streets,
 
SB854 Engrossed             -8-                LRB9204999SMdv
 1    access roads, bridges,  sidewalks,  waste  disposal  systems,
 2    water  and  sewer  line  extensions,  water  distribution and
 3    purification facilities, storm water drainage  and  retention
 4    facilities, and sewage treatment facilities, resulting from a
 5    State or federally declared disaster in Illinois or bordering
 6    Illinois  when  such  repairs  are  initiated  on  facilities
 7    located  in  the declared disaster area within 6 months after
 8    the disaster.
 9        (26)  Beginning  July  1,  1999,  game  or   game   birds
10    purchased  at  a "game breeding and hunting preserve area" or
11    an "exotic game hunting area" as those terms are used in  the
12    Wildlife  Code  or  at  a  hunting enclosure approved through
13    rules adopted by the Department of Natural  Resources.   This
14    paragraph is exempt from the provisions of Section 3-90.
15        (27)  A motor vehicle, as that term is defined in Section
16    1-146  of  the  Illinois  Vehicle  Code, that is donated to a
17    corporation, limited liability company, society, association,
18    foundation,  or  institution  that  is  determined   by   the
19    Department  to  be  organized  and  operated  exclusively for
20    educational purposes.  For purposes  of  this  exemption,  "a
21    corporation, limited liability company, society, association,
22    foundation, or institution organized and operated exclusively
23    for  educational  purposes"  means  all  tax-supported public
24    schools, private schools that offer systematic instruction in
25    useful branches of  learning  by  methods  common  to  public
26    schools  and  that  compare  favorably  in  their  scope  and
27    intensity with the course of study presented in tax-supported
28    schools,  and  vocational  or technical schools or institutes
29    organized and operated exclusively to  provide  a  course  of
30    study  of  not  less  than  6  weeks duration and designed to
31    prepare individuals to follow a trade or to pursue a  manual,
32    technical,  mechanical,  industrial,  business, or commercial
33    occupation.
34        (28)  Beginning  January  1,  2000,   personal  property,
 
SB854 Engrossed             -9-                LRB9204999SMdv
 1    including food, purchased through fundraising events for  the
 2    benefit  of  a  public  or  private  elementary  or secondary
 3    school, a group of those  schools,  or  one  or  more  school
 4    districts if the events are sponsored by an entity recognized
 5    by  the school district that consists primarily of volunteers
 6    and includes parents and teachers  of  the  school  children.
 7    This  paragraph  does not apply to fundraising events (i) for
 8    the benefit of private home instruction or (ii) for which the
 9    fundraising entity purchases the personal  property  sold  at
10    the  events  from  another individual or entity that sold the
11    property for the purpose of resale by the fundraising  entity
12    and  that  profits  from  the sale to the fundraising entity.
13    This paragraph is exempt from the provisions of Section 3-90.
14        (29)  Beginning January 1, 2000, new  or  used  automatic
15    vending   machines  that  prepare  and  serve  hot  food  and
16    beverages, including  coffee,  soup,  and  other  items,  and
17    replacement  parts  for  these  machines.   This paragraph is
18    exempt from the provisions of Section 3-90.
19        (30)  Food for human consumption that is to  be  consumed
20    off  the  premises  where  it  is  sold (other than alcoholic
21    beverages, soft drinks, and food that has been  prepared  for
22    immediate  consumption)  and prescription and nonprescription
23    medicines, drugs,  medical  appliances,  and  insulin,  urine
24    testing  materials,  syringes, and needles used by diabetics,
25    for human use, when purchased for use by a  person  receiving
26    medical assistance under Article 5 of the Illinois Public Aid
27    Code  who  resides  in a licensed long-term care facility, as
28    defined in the Nursing Home Care Act.
29    (Source: P.A. 90-14,  eff.  7-1-97;  90-552,  eff.  12-12-97;
30    90-605,  eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200, eff.
31    7-20-99; 91-439, eff. 8-6-99; 91-637, eff.  8-20-99;  91-644,
32    eff. 8-20-99; 91-901, eff. 1-1-01.)

33        Section  10.   The  Service  Use  Tax  Act  is amended by
 
SB854 Engrossed             -10-               LRB9204999SMdv
 1    changing Section 3-5 as follows:

 2        (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
 3        Sec. 3-5.  Exemptions.  Use  of  the  following  tangible
 4    personal property is exempt from the tax imposed by this Act:
 5        (1)  Personal  property  purchased  from  a  corporation,
 6    society,    association,    foundation,    institution,    or
 7    organization, other than a limited liability company, that is
 8    organized and operated as a not-for-profit service enterprise
 9    for  the  benefit  of persons 65 years of age or older if the
10    personal property was not purchased by the enterprise for the
11    purpose of resale by the enterprise.
12        (2)  Personal property purchased by a non-profit Illinois
13    county fair association for use in conducting, operating,  or
14    promoting the county fair.
15        (3)  Personal property purchased by a not-for-profit arts
16    or  cultural organization that establishes, by proof required
17    by 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 primarily for the presentation or
20    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. On and after the
26    effective  date  of  this  amendatory Act of the 92nd General
27    Assembly, however, an  entity  otherwise  eligible  for  this
28    exemption  shall not make tax-free purchases unless it has an
29    active identification number issued by the Department.
30        (4)  Legal  tender,  currency,  medallions,  or  gold  or
31    silver  coinage  issued  by  the  State  of   Illinois,   the
32    government of the United States of America, or the government
33    of any foreign country, and bullion.
 
SB854 Engrossed             -11-               LRB9204999SMdv
 1        (5)  Graphic  arts  machinery  and  equipment,  including
 2    repair   and  replacement  parts,  both  new  and  used,  and
 3    including that manufactured on special order or purchased for
 4    lease, certified by the purchaser to be  used  primarily  for
 5    graphic arts production.
 6        (6)  Personal property purchased from a teacher-sponsored
 7    student   organization   affiliated  with  an  elementary  or
 8    secondary school located in Illinois.
 9        (7)  Farm machinery and equipment,  both  new  and  used,
10    including  that  manufactured  on special order, certified by
11    the purchaser to be used primarily for production agriculture
12    or  State  or  federal   agricultural   programs,   including
13    individual replacement parts for the machinery and equipment,
14    including  machinery  and  equipment purchased for lease, and
15    including implements of husbandry defined in Section 1-130 of
16    the Illinois Vehicle Code, farm  machinery  and  agricultural
17    chemical  and fertilizer spreaders, and nurse wagons required
18    to be registered under Section 3-809 of the Illinois  Vehicle
19    Code,  but  excluding  other  motor  vehicles  required to be
20    registered under the  Illinois  Vehicle  Code.  Horticultural
21    polyhouses  or  hoop houses used for propagating, growing, or
22    overwintering plants shall be considered farm  machinery  and
23    equipment  under  this item (7). Agricultural chemical tender
24    tanks and dry boxes shall include units sold separately  from
25    a  motor  vehicle  required  to  be  licensed  and units sold
26    mounted on a motor vehicle required to  be  licensed  if  the
27    selling price of the tender is separately stated.
28        Farm  machinery  and  equipment  shall  include precision
29    farming equipment  that  is  installed  or  purchased  to  be
30    installed  on farm machinery and equipment including, but not
31    limited  to,  tractors,   harvesters,   sprayers,   planters,
32    seeders,  or spreaders. Precision farming equipment includes,
33    but is not  limited  to,  soil  testing  sensors,  computers,
34    monitors,  software,  global positioning and mapping systems,
 
SB854 Engrossed             -12-               LRB9204999SMdv
 1    and other such equipment.
 2        Farm machinery and  equipment  also  includes  computers,
 3    sensors,  software,  and  related equipment used primarily in
 4    the computer-assisted  operation  of  production  agriculture
 5    facilities,  equipment,  and  activities  such  as,  but  not
 6    limited  to,  the  collection, monitoring, and correlation of
 7    animal and crop data for the purpose  of  formulating  animal
 8    diets  and  agricultural  chemicals.  This item (7) is exempt
 9    from the provisions of Section 3-75.
10        (8)  Fuel and petroleum products sold to or  used  by  an
11    air  common  carrier, certified by the carrier to be used for
12    consumption, shipment, or  storage  in  the  conduct  of  its
13    business  as an air common carrier, for a flight destined for
14    or returning from a location or locations outside the  United
15    States  without  regard  to  previous  or subsequent domestic
16    stopovers.
17        (9)  Proceeds of  mandatory  service  charges  separately
18    stated  on  customers' bills for the purchase and consumption
19    of food and beverages acquired as an incident to the purchase
20    of a service from  a  serviceman,  to  the  extent  that  the
21    proceeds  of  the  service  charge are in fact turned over as
22    tips or as  a  substitute  for  tips  to  the  employees  who
23    participate   directly  in  preparing,  serving,  hosting  or
24    cleaning up the food or beverage  function  with  respect  to
25    which the service charge is imposed.
26        (10)  Oil  field  exploration,  drilling,  and production
27    equipment, including (i) rigs and parts of rigs, rotary rigs,
28    cable tool rigs, and workover rigs,  (ii)  pipe  and  tubular
29    goods,  including  casing  and drill strings, (iii) pumps and
30    pump-jack units, (iv) storage tanks and flow lines,  (v)  any
31    individual   replacement  part  for  oil  field  exploration,
32    drilling, and production equipment, and  (vi)  machinery  and
33    equipment  purchased  for lease; but excluding motor vehicles
34    required to be registered under the Illinois Vehicle Code.
 
SB854 Engrossed             -13-               LRB9204999SMdv
 1        (11)  Proceeds from the sale of photoprocessing machinery
 2    and equipment, including repair and replacement  parts,  both
 3    new  and  used, including that manufactured on special order,
 4    certified  by  the  purchaser  to  be  used   primarily   for
 5    photoprocessing,  and including photoprocessing machinery and
 6    equipment purchased for lease.
 7        (12)  Coal  exploration,  mining,   offhighway   hauling,
 8    processing, maintenance, and reclamation equipment, including
 9    replacement  parts  and  equipment,  and  including equipment
10    purchased for lease, but excluding motor vehicles required to
11    be registered under the Illinois Vehicle Code.
12        (13)  Semen used for artificial insemination of livestock
13    for direct agricultural production.
14        (14)  Horses, or interests in horses, registered with and
15    meeting the requirements of any of  the  Arabian  Horse  Club
16    Registry  of  America, Appaloosa Horse Club, American Quarter
17    Horse Association, United  States  Trotting  Association,  or
18    Jockey Club, as appropriate, used for purposes of breeding or
19    racing for prizes.
20        (15)  Computers and communications equipment utilized for
21    any  hospital  purpose  and  equipment used in the diagnosis,
22    analysis, or treatment of hospital patients  purchased  by  a
23    lessor who leases the equipment, under a lease of one year or
24    longer  executed  or  in  effect at the time the lessor would
25    otherwise be subject to the tax imposed by  this  Act,  to  a
26    hospital  that  has  been  issued  an  active  tax  exemption
27    identification  number  by the Department under Section 1g of
28    the Retailers' Occupation Tax Act. If the equipment is leased
29    in a manner that does not qualify for this  exemption  or  is
30    used  in  any  other  non-exempt  manner, the lessor shall be
31    liable for the tax imposed under this Act or the Use Tax Act,
32    as the case may be, based on the fair  market  value  of  the
33    property  at  the  time  the  non-qualifying  use occurs.  No
34    lessor shall collect or attempt to collect an amount (however
 
SB854 Engrossed             -14-               LRB9204999SMdv
 1    designated) that purports to reimburse that  lessor  for  the
 2    tax  imposed  by this Act or the Use Tax Act, as the case may
 3    be, if the tax has not been paid by the lessor.  If a  lessor
 4    improperly  collects  any  such  amount  from the lessee, the
 5    lessee shall have a legal right to claim  a  refund  of  that
 6    amount  from  the  lessor.   If,  however, that amount is not
 7    refunded to the lessee for any reason, the lessor  is  liable
 8    to pay that amount to the Department.
 9        (16)  Personal  property purchased by a lessor who leases
10    the property, under a lease of one year or longer executed or
11    in effect at the time the lessor would otherwise  be  subject
12    to  the  tax imposed by this Act, to a governmental body that
13    has been issued an active tax exemption identification number
14    by  the  Department  under  Section  1g  of  the   Retailers'
15    Occupation  Tax  Act.   If the property is leased in a manner
16    that does not qualify for this exemption or is  used  in  any
17    other  non-exempt  manner, the lessor shall be liable for the
18    tax imposed under this Act or the Use Tax Act,  as  the  case
19    may be, based on the fair market value of the property at the
20    time  the non-qualifying use occurs.  No lessor shall collect
21    or attempt to collect an  amount  (however  designated)  that
22    purports to reimburse that lessor for the tax imposed by this
23    Act  or  the  Use Tax Act, as the case may be, if the tax has
24    not been paid by the lessor.  If a lessor improperly collects
25    any such amount from the lessee,  the  lessee  shall  have  a
26    legal right to claim a refund of that amount from the lessor.
27    If,  however,  that  amount is not refunded to the lessee for
28    any reason, the lessor is liable to pay that  amount  to  the
29    Department.
30        (17)  Beginning  with  taxable  years  ending on or after
31    December 31, 1995 and ending with taxable years ending on  or
32    before  December  31, 2004, personal property that is donated
33    for disaster relief to  be  used  in  a  State  or  federally
34    declared disaster area in Illinois or bordering Illinois by a
 
SB854 Engrossed             -15-               LRB9204999SMdv
 1    manufacturer  or retailer that is registered in this State to
 2    a   corporation,   society,   association,   foundation,   or
 3    institution that  has  been  issued  a  sales  tax  exemption
 4    identification  number by the Department that assists victims
 5    of the disaster who reside within the declared disaster area.
 6        (18)  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  used  in
 9    the  performance  of  infrastructure  repairs  in this State,
10    including but not limited to  municipal  roads  and  streets,
11    access  roads,  bridges,  sidewalks,  waste disposal systems,
12    water and  sewer  line  extensions,  water  distribution  and
13    purification  facilities,  storm water drainage and retention
14    facilities, and sewage treatment facilities, resulting from a
15    State or federally declared disaster in Illinois or bordering
16    Illinois  when  such  repairs  are  initiated  on  facilities
17    located in the declared disaster area within 6  months  after
18    the disaster.
19        (19)  Beginning   July   1,  1999,  game  or  game  birds
20    purchased at a "game breeding and hunting preserve  area"  or
21    an  "exotic game hunting area" as those terms are used in the
22    Wildlife Code or at  a  hunting  enclosure  approved  through
23    rules  adopted  by the Department of Natural Resources.  This
24    paragraph is exempt from the provisions of Section 3-75.
25        (20) (19)  A motor vehicle, as that term  is  defined  in
26    Section  1-146  of the Illinois Vehicle Code, that is donated
27    to  a  corporation,  limited  liability   company,   society,
28    association, foundation, or institution that is determined by
29    the  Department  to be organized and operated exclusively for
30    educational purposes.  For purposes  of  this  exemption,  "a
31    corporation, limited liability company, society, association,
32    foundation, or institution organized and operated exclusively
33    for  educational  purposes"  means  all  tax-supported public
34    schools, private schools that offer systematic instruction in
 
SB854 Engrossed             -16-               LRB9204999SMdv
 1    useful branches of  learning  by  methods  common  to  public
 2    schools  and  that  compare  favorably  in  their  scope  and
 3    intensity with the course of study presented in tax-supported
 4    schools,  and  vocational  or technical schools or institutes
 5    organized and operated exclusively to  provide  a  course  of
 6    study  of  not  less  than  6  weeks duration and designed to
 7    prepare individuals to follow a trade or to pursue a  manual,
 8    technical,  mechanical,  industrial,  business, or commercial
 9    occupation.
10        (21) (20)  Beginning January 1, 2000,  personal property,
11    including food, purchased through fundraising events for  the
12    benefit  of  a  public  or  private  elementary  or secondary
13    school, a group of those  schools,  or  one  or  more  school
14    districts if the events are sponsored by an entity recognized
15    by  the school district that consists primarily of volunteers
16    and includes parents and teachers  of  the  school  children.
17    This  paragraph  does not apply to fundraising events (i) for
18    the benefit of private home instruction or (ii) for which the
19    fundraising entity purchases the personal  property  sold  at
20    the  events  from  another individual or entity that sold the
21    property for the purpose of resale by the fundraising  entity
22    and  that  profits  from  the sale to the fundraising entity.
23    This paragraph is exempt from the provisions of Section 3-75.
24        (22)  (19)  Beginning  January  1,  2000,  new  or   used
25    automatic  vending  machines  that prepare and serve hot food
26    and beverages, including coffee, soup, and other  items,  and
27    replacement  parts  for  these  machines.   This paragraph is
28    exempt from the provisions of Section 3-75.
29    (Source: P.A. 90-14,  eff.  7-1-97;  90-552,  eff.  12-12-97;
30    90-605,  eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200, eff.
31    7-20-99; 91-439, eff. 8-6-99; 91-637, eff.  8-20-99;  91-644,
32    eff. 8-20-99; revised 9-29-99.)

33        Section 15.  The Service Occupation Tax Act is amended by
 
SB854 Engrossed             -17-               LRB9204999SMdv
 1    changing Section 3-5 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 primarily for the
20    presentation or support  of  arts  or  cultural  programming,
21    activities,  or  services.   These organizations include, but
22    are not limited to, music  and  dramatic  arts  organizations
23    such  as  symphony orchestras and theatrical groups, arts and
24    cultural service organizations, local arts  councils,  visual
25    arts  organizations,  and  media  arts  organizations. On and
26    after the effective date of this amendatory Act of  the  92nd
27    General  Assembly,  however, an entity otherwise eligible for
28    this exemption shall not make tax-free  purchases  unless  it
29    has an active identification number issued by the Department.
30        (4)  Legal  tender,  currency,  medallions,  or  gold  or
31    silver   coinage   issued  by  the  State  of  Illinois,  the
32    government of the United States of America, or the government
33    of any foreign country, and bullion.
 
SB854 Engrossed             -18-               LRB9204999SMdv
 1        (5)  Graphic  arts  machinery  and  equipment,  including
 2    repair  and  replacement  parts,  both  new  and  used,   and
 3    including that manufactured on special order or purchased for
 4    lease,  certified  by  the purchaser to be used primarily for
 5    graphic arts production.
 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)  Farm machinery and equipment,  both  new  and  used,
10    including  that  manufactured  on special order, certified by
11    the purchaser to be used primarily for production agriculture
12    or  State  or  federal   agricultural   programs,   including
13    individual replacement parts for the machinery and equipment,
14    including  machinery  and  equipment purchased for lease, and
15    including implements of husbandry defined in Section 1-130 of
16    the Illinois Vehicle Code, farm  machinery  and  agricultural
17    chemical  and fertilizer spreaders, and nurse wagons required
18    to be registered under Section 3-809 of the Illinois  Vehicle
19    Code,  but  excluding  other  motor  vehicles  required to be
20    registered under the  Illinois  Vehicle  Code.  Horticultural
21    polyhouses  or  hoop houses used for propagating, growing, or
22    overwintering plants shall be considered farm  machinery  and
23    equipment  under  this item (7). Agricultural chemical tender
24    tanks and dry boxes shall include units sold separately  from
25    a  motor  vehicle  required  to  be  licensed  and units sold
26    mounted on a motor vehicle required to  be  licensed  if  the
27    selling price of the tender is separately stated.
28        Farm  machinery  and  equipment  shall  include precision
29    farming equipment  that  is  installed  or  purchased  to  be
30    installed  on farm machinery and equipment including, but not
31    limited  to,  tractors,   harvesters,   sprayers,   planters,
32    seeders,  or spreaders. Precision farming equipment includes,
33    but is not  limited  to,  soil  testing  sensors,  computers,
34    monitors,  software,  global positioning and mapping systems,
 
SB854 Engrossed             -19-               LRB9204999SMdv
 1    and other such equipment.
 2        Farm machinery and  equipment  also  includes  computers,
 3    sensors,  software,  and  related equipment used primarily in
 4    the computer-assisted  operation  of  production  agriculture
 5    facilities,  equipment,  and  activities  such  as,  but  not
 6    limited  to,  the  collection, monitoring, and correlation of
 7    animal and crop data for the purpose  of  formulating  animal
 8    diets  and  agricultural  chemicals.  This item (7) is exempt
 9    from the provisions of Section 3-55.
10        (8)  Fuel and petroleum products sold to or  used  by  an
11    air  common  carrier, certified by the carrier to be used for
12    consumption, shipment, or  storage  in  the  conduct  of  its
13    business  as an air common carrier, for a flight destined for
14    or returning from a location or locations outside the  United
15    States  without  regard  to  previous  or subsequent domestic
16    stopovers.
17        (9)  Proceeds of  mandatory  service  charges  separately
18    stated  on  customers' bills for the purchase and consumption
19    of food and beverages, to the extent that the proceeds of the
20    service charge are in fact  turned  over  as  tips  or  as  a
21    substitute for tips to the employees who participate directly
22    in  preparing,  serving,  hosting  or cleaning up the food or
23    beverage function with respect to which the service charge is
24    imposed.
25        (10)  Oil field  exploration,  drilling,  and  production
26    equipment, including (i) rigs and parts of rigs, rotary rigs,
27    cable  tool  rigs,  and  workover rigs, (ii) pipe and tubular
28    goods, including casing and drill strings,  (iii)  pumps  and
29    pump-jack  units,  (iv) storage tanks and flow lines, (v) any
30    individual  replacement  part  for  oil  field   exploration,
31    drilling,  and  production  equipment, and (vi) machinery and
32    equipment purchased for lease; but excluding  motor  vehicles
33    required to be registered under the Illinois Vehicle Code.
34        (11)  Photoprocessing  machinery and equipment, including
 
SB854 Engrossed             -20-               LRB9204999SMdv
 1    repair and replacement parts, both new  and  used,  including
 2    that   manufactured   on  special  order,  certified  by  the
 3    purchaser to  be  used  primarily  for  photoprocessing,  and
 4    including  photoprocessing  machinery and equipment purchased
 5    for lease.
 6        (12)  Coal  exploration,  mining,   offhighway   hauling,
 7    processing, maintenance, and reclamation equipment, including
 8    replacement  parts  and  equipment,  and  including equipment
 9    purchased for lease, but excluding motor vehicles required to
10    be registered under the Illinois Vehicle Code.
11        (13)  Food for human consumption that is to  be  consumed
12    off  the  premises  where  it  is  sold (other than alcoholic
13    beverages, soft drinks and food that has  been  prepared  for
14    immediate  consumption) and prescription and non-prescription
15    medicines, drugs,  medical  appliances,  and  insulin,  urine
16    testing  materials,  syringes, and needles used by diabetics,
17    for human use, when purchased for use by a  person  receiving
18    medical assistance under Article 5 of the Illinois Public Aid
19    Code  who  resides  in a licensed long-term care facility, as
20    defined in the Nursing Home Care Act.
21        (14)  Semen used for artificial insemination of livestock
22    for direct agricultural production.
23        (15)  Horses, or interests in horses, registered with and
24    meeting the requirements of any of  the  Arabian  Horse  Club
25    Registry  of  America, Appaloosa Horse Club, American Quarter
26    Horse Association, United  States  Trotting  Association,  or
27    Jockey Club, as appropriate, used for purposes of breeding or
28    racing for prizes.
29        (16)  Computers and communications equipment utilized for
30    any  hospital  purpose  and  equipment used in the diagnosis,
31    analysis, or treatment of hospital patients sold to a  lessor
32    who leases the equipment, under a lease of one year or longer
33    executed  or  in  effect  at  the  time of the purchase, to a
34    hospital  that  has  been  issued  an  active  tax  exemption
 
SB854 Engrossed             -21-               LRB9204999SMdv
 1    identification number by the Department under Section  1g  of
 2    the Retailers' Occupation Tax Act.
 3        (17)  Personal  property  sold to a lessor who leases the
 4    property, under a lease of one year or longer executed or  in
 5    effect  at  the  time of the purchase, to a governmental body
 6    that has been issued an active tax  exemption  identification
 7    number  by  the Department under Section 1g of the Retailers'
 8    Occupation Tax Act.
 9        (18)  Beginning with taxable years  ending  on  or  after
10    December  31, 1995 and ending with taxable years ending on or
11    before December 31, 2004, personal property that  is  donated
12    for  disaster  relief  to  be  used  in  a State or federally
13    declared disaster area in Illinois or bordering Illinois by a
14    manufacturer or retailer that is registered in this State  to
15    a   corporation,   society,   association,   foundation,   or
16    institution  that  has  been  issued  a  sales  tax exemption
17    identification number by the Department that assists  victims
18    of the disaster who reside within the declared disaster area.
19        (19)  Beginning  with  taxable  years  ending on or after
20    December 31, 1995 and ending with taxable years ending on  or
21    before  December  31, 2004, personal property that is used in
22    the performance of  infrastructure  repairs  in  this  State,
23    including  but  not  limited  to municipal roads and streets,
24    access roads, bridges,  sidewalks,  waste  disposal  systems,
25    water  and  sewer  line  extensions,  water  distribution and
26    purification facilities, storm water drainage  and  retention
27    facilities, and sewage treatment facilities, resulting from a
28    State or federally declared disaster in Illinois or bordering
29    Illinois  when  such  repairs  are  initiated  on  facilities
30    located  in  the declared disaster area within 6 months after
31    the disaster.
32        (20)  Beginning July 1, 1999, game or game birds sold  at
33    a  "game  breeding  and  hunting preserve area" or an "exotic
34    game hunting area" as those terms are used  in  the  Wildlife
 
SB854 Engrossed             -22-               LRB9204999SMdv
 1    Code or at a hunting enclosure approved through rules adopted
 2    by  the  Department  of Natural Resources.  This paragraph is
 3    exempt from the provisions of Section 3-55.
 4        (21) (20)  A motor vehicle, as that term  is  defined  in
 5    Section  1-146  of the Illinois Vehicle Code, that is donated
 6    to  a  corporation,  limited  liability   company,   society,
 7    association, foundation, or institution that is determined by
 8    the  Department  to be organized and operated exclusively for
 9    educational purposes.  For purposes  of  this  exemption,  "a
10    corporation, limited liability company, society, association,
11    foundation, or institution organized and operated exclusively
12    for  educational  purposes"  means  all  tax-supported public
13    schools, private schools that offer systematic instruction in
14    useful branches of  learning  by  methods  common  to  public
15    schools  and  that  compare  favorably  in  their  scope  and
16    intensity with the course of study presented in tax-supported
17    schools,  and  vocational  or technical schools or institutes
18    organized and operated exclusively to  provide  a  course  of
19    study  of  not  less  than  6  weeks duration and designed to
20    prepare individuals to follow a trade or to pursue a  manual,
21    technical,  mechanical,  industrial,  business, or commercial
22    occupation.
23        (22) (21)  Beginning January 1, 2000,  personal property,
24    including food, purchased through fundraising events for  the
25    benefit  of  a  public  or  private  elementary  or secondary
26    school, a group of those  schools,  or  one  or  more  school
27    districts if the events are sponsored by an entity recognized
28    by  the school district that consists primarily of volunteers
29    and includes parents and teachers  of  the  school  children.
30    This  paragraph  does not apply to fundraising events (i) for
31    the benefit of private home instruction or (ii) for which the
32    fundraising entity purchases the personal  property  sold  at
33    the  events  from  another individual or entity that sold the
34    property for the purpose of resale by the fundraising  entity
 
SB854 Engrossed             -23-               LRB9204999SMdv
 1    and  that  profits  from  the sale to the fundraising entity.
 2    This paragraph is exempt from the provisions of Section 3-55.
 3        (23)  (20)  Beginning  January  1,  2000,  new  or   used
 4    automatic  vending  machines  that prepare and serve hot food
 5    and beverages, including coffee, soup, and other  items,  and
 6    replacement  parts  for  these  machines.   This paragraph is
 7    exempt from the provisions of Section 3-55.
 8    (Source: P.A. 90-14,  eff.  7-1-97;  90-552,  eff.  12-12-97;
 9    90-605,  eff.  6-30-98;  91-51,  eff.  6-30-99;  91-200, eff.
10    7-20-99; 91-439, eff. 8-6-99; 91-533, eff.  8-13-99;  91-637,
11    eff. 8-20-99; 91-644, eff. 8-20-99; revised 9-29-99.)

12        Section 20.  The Retailers' Occupation Tax Act is amended
13    by changing Sections 1g and 2-5 as follows:

14        (35 ILCS 120/1g) (from Ch. 120, par. 440g)
15        Sec.   1g.    Application  for  exemption  identification
16    number.   On  or  before  December  31,   1986,   except   as
17    hereinafter  provided,  each  entity otherwise eligible under
18    exemption (11) of Section 2-5 of this Act and  on  and  after
19    the effective date of this amendatory Act of the 92nd General
20    Assembly  each  entity otherwise eligible under exemption (9)
21    of Section 2-5 of this Act  shall  make  application  to  the
22    Department  for  an  exemption  identification number. In the
23    case of a corporation, society, association,  foundation,  or
24    institution organized and operated exclusively for charitable
25    purposes  and  that has more than 50 subsidiary organizations
26    in Illinois, the Department,  in  its  sole  discretion,  may
27    issue  one  exemption identification number to be used by the
28    parent organization and each subsidiary organization.
29        Each exemption identification number  or  renewal  number
30    shall  be  valid for 5 years after the first day of the month
31    following the month of  issuance.  Not  less  than  3  months
32    before  the expiration date, an application for renewal shall
 
SB854 Engrossed             -24-               LRB9204999SMdv
 1    be filed.
 2        Each application for an exemption  identification  number
 3    or   a  renewal  number  shall  contain  information  and  be
 4    accompanied by documentation as shall  be  requested  by  the
 5    Department.
 6    (Source: P.A. 86-1475.)

 7        (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
 8        Sec. 2-5.  Exemptions.  Gross receipts from proceeds from
 9    the  sale  of  the  following  tangible personal property are
10    exempt from the tax imposed by this Act:
11        (1)  Farm chemicals.
12        (2)  Farm machinery and equipment,  both  new  and  used,
13    including  that  manufactured  on special order, certified by
14    the purchaser to be used primarily for production agriculture
15    or  State  or  federal   agricultural   programs,   including
16    individual replacement parts for the machinery and equipment,
17    including  machinery  and  equipment purchased for lease, and
18    including implements of husbandry defined in Section 1-130 of
19    the Illinois Vehicle Code, farm  machinery  and  agricultural
20    chemical  and fertilizer spreaders, and nurse wagons required
21    to be registered under Section 3-809 of the Illinois  Vehicle
22    Code,  but  excluding  other  motor  vehicles  required to be
23    registered under the  Illinois  Vehicle  Code.  Horticultural
24    polyhouses  or  hoop houses used for propagating, growing, or
25    overwintering plants shall be considered farm  machinery  and
26    equipment  under  this item (2). Agricultural chemical tender
27    tanks and dry boxes shall include units sold separately  from
28    a  motor  vehicle  required  to  be  licensed  and units sold
29    mounted on a motor vehicle required to be  licensed,  if  the
30    selling price of the tender is separately stated.
31        Farm  machinery  and  equipment  shall  include precision
32    farming equipment  that  is  installed  or  purchased  to  be
33    installed  on farm machinery and equipment including, but not
 
SB854 Engrossed             -25-               LRB9204999SMdv
 1    limited  to,  tractors,   harvesters,   sprayers,   planters,
 2    seeders,  or spreaders. Precision farming equipment includes,
 3    but is not  limited  to,  soil  testing  sensors,  computers,
 4    monitors,  software,  global positioning and mapping systems,
 5    and other such equipment.
 6        Farm machinery and  equipment  also  includes  computers,
 7    sensors,  software,  and  related equipment used primarily in
 8    the computer-assisted  operation  of  production  agriculture
 9    facilities,  equipment,  and  activities  such  as,  but  not
10    limited  to,  the  collection, monitoring, and correlation of
11    animal and crop data for the purpose  of  formulating  animal
12    diets  and  agricultural  chemicals.  This item (7) is exempt
13    from the provisions of Section 2-70.
14        (3)  Distillation machinery and equipment, sold as a unit
15    or kit, assembled or installed by the retailer, certified  by
16    the  user to be used only for the production of ethyl alcohol
17    that will be used for consumption  as  motor  fuel  or  as  a
18    component of motor fuel for the personal use of the user, and
19    not subject to sale or resale.
20        (4)  Graphic  arts  machinery  and  equipment,  including
21    repair   and  replacement  parts,  both  new  and  used,  and
22    including that manufactured on special order or purchased for
23    lease, certified by the purchaser to be  used  primarily  for
24    graphic arts production.
25        (5)  A  motor  vehicle  of  the  first  division, a motor
26    vehicle of the second division that is a self-contained motor
27    vehicle designed or permanently converted to  provide  living
28    quarters  for  recreational,  camping,  or  travel  use, with
29    direct walk through access to the living  quarters  from  the
30    driver's seat, or a motor vehicle of the second division that
31    is  of  the van configuration designed for the transportation
32    of not less than 7 nor more than 16 passengers, as defined in
33    Section 1-146 of the Illinois Vehicle Code, that is used  for
34    automobile  renting,  as  defined  in  the Automobile Renting
 
SB854 Engrossed             -26-               LRB9204999SMdv
 1    Occupation and Use Tax Act.
 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)  Proceeds of that portion of the selling price  of  a
 6    passenger car the sale of which is subject to the Replacement
 7    Vehicle Tax.
 8        (8)  Personal  property  sold  to an Illinois county fair
 9    association for use in conducting,  operating,  or  promoting
10    the county fair.
11        (9)  Personal  property  sold to a not-for-profit arts or
12    cultural organization that establishes, by proof required  by
13    the  Department  by  rule,  that it has received an exemption
14    under Section 501(c)(3) of the Internal Revenue Code and that
15    is organized and operated primarily for the  presentation  or
16    support  of  arts  or  cultural  programming,  activities, or
17    services.  These organizations include, but are  not  limited
18    to,  music  and  dramatic arts organizations such as symphony
19    orchestras and theatrical groups, arts and  cultural  service
20    organizations,    local    arts    councils,    visual   arts
21    organizations, and media arts organizations. On and after the
22    effective date of this amendatory Act  of  the  92nd  General
23    Assembly,  however,  an  entity  otherwise  eligible for this
24    exemption shall not make tax-free purchases unless it has  an
25    active identification number issued by the Department.
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
 
SB854 Engrossed             -27-               LRB9204999SMdv
 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
 
SB854 Engrossed             -28-               LRB9204999SMdv
 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
 
SB854 Engrossed             -29-               LRB9204999SMdv
 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
 
SB854 Engrossed             -30-               LRB9204999SMdv
 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
 
SB854 Engrossed             -31-               LRB9204999SMdv
 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
 
SB854 Engrossed             -32-               LRB9204999SMdv
 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    (Source: P.A.  90-14,  eff.  7-1-97;  90-519,  eff.   6-1-98;
32    90-552,  eff.  12-12-97;  90-605,  eff.  6-30-98; 91-51, eff.
33    6-30-99; 91-200, eff. 7-20-99; 91-439, eff.  8-6-99;  91-533,
34    eff.  8-13-99;  91-637,  eff.  8-20-99; 91-644, eff. 8-20-99;
 
SB854 Engrossed             -33-               LRB9204999SMdv
 1    revised 9-28-99.)

 2        Section 99.  Effective date.  This Act  takes  effect  on
 3    July 1, 2001.

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