Public Act 93-0031
SB1733 Enrolled LRB093 03177 JLS 03194 b
AN ACT in relation to taxes.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
ARTICLE 5
Section 5-1. Short title. This Article may be cited as
the Gas Use Tax Law.
Section 5-5. Definitions. For purposes of this Law:
"Delivering supplier" means any person engaged in the
business of delivering gas to persons for use or consumption
and not for resale, and who, in any case where more than one
person participates in the delivery of gas to a specific
purchaser, is the last of the suppliers engaged in delivering
the gas prior to its receipt by the purchaser.
"Delivering supplier maintaining a place of business in
this State", or any like term, means any delivering supplier
having or maintaining within this State, directly or by a
subsidiary, an office, distribution facility, sales office,
or other place of business, or any employee, agent, or other
representative operating within this State under the
authority of such delivering supplier or such delivering
supplier's subsidiary, irrespective of whether such place of
business or agent or other representative is located in this
State permanently or temporarily, or whether such delivering
supplier or such delivering supplier's subsidiary is licensed
to do business in this State.
"Department" means the Department of Revenue of the State
of Illinois.
"Director" means the Director of Revenue.
"Gas" means any gaseous fuel distributed through a
pipeline system.
"Person" means any natural individual, firm, trust,
estate, partnership, association, joint stock company, joint
adventure, corporation, limited liability company, or a
receiver, trustee, guardian, or other representative
appointed by order of any court, or any city, town, county,
or other political subdivision of this State.
"Purchase of out-of-State gas" means a transaction for
the purchase of gas from any supplier in a manner that does
not subject the seller of that gas to liability under the Gas
Revenue Tax Act.
"Purchase price" means the consideration paid for the
distribution, supply, furnishing, sale, transportation, or
delivery of gas to a person for use or consumption and not
for resale, and for all services directly related to the
production, transportation, or distribution of gas
distributed, supplied, furnished, sold, transmitted, or
delivered for use or consumption, including cash, services,
and property of every kind and nature. However, "purchase
price" shall not include consideration paid for:
(i) Any charge for a dishonored check.
(ii) Any finance or credit charge, penalty, charge
for delayed payment, or discount for prompt payment.
(iii) Any charge for reconnection of service or for
replacement or relocation of facilities.
(iv) Any advance or contribution in aid of
construction.
(v) Repair, inspection, or servicing of equipment
located on customer premises.
(vi) Leasing or rental of equipment, the leasing or
rental of which is not necessary to furnishing,
supplying, or selling gas.
(vii) Any purchase by a purchaser if the supplier
is prohibited by federal or State constitution, treaty,
convention, statute, or court decision from recovering
the related tax liability from such purchaser.
(viii) Any amounts added to purchasers' bills
because of changes made pursuant to the tax imposed by
this Law.
In case credit is extended, the amount thereof shall be
included only as and when payments are received.
"Purchaser" means any person who acquires the ownership
of gas for use or consumption, and not for resale, for a
valuable consideration.
"Self-assessing purchaser" means a purchaser of gas for
use or consumption that is required to be registered with the
Department and is responsible for filing returns and paying
the tax imposed under this Law directly to the Department.
"Use" means the exercise by any person of any right or
power over gas incident to the ownership of that gas, except
that it does not include the sale of gas in the regular
course of business.
Section 5-10. Imposition of tax. Beginning October 1,
2003, a tax is imposed upon the privilege of using in this
State gas obtained in a purchase of out-of-state gas at the
rate of 2.4 cents per therm or 5% of the purchase price for
the billing period, whichever is the lower rate. Such tax
rate shall be referred to as the "self-assessing purchaser
tax rate". Beginning with bills issued by delivering
suppliers on and after October 1, 2003, purchasers may elect
an alternative tax rate of 2.4 cents per therm to be paid
under the provisions of Section 5-15 of this Law to a
delivering supplier maintaining a place of business in this
State. Such tax rate shall be referred to as the "alternate
tax rate". The tax imposed under this Section shall not apply
to gas used by business enterprises certified under Section
9-222.1 of the Public Utilities Act, as amended, to the
extent of such exemption and during the period of time
specified by the Department of Commerce and Community
Affairs.
Section 5-15. Collection of Gas Use Tax; relief of duty.
Beginning with bills issued on and after October 1, 2003, a
delivering supplier maintaining a place of business in this
State shall collect, from the purchasers who have elected the
alternate tax rate provided in Section 5-10 of this Law, the
tax that is imposed by this Law at the alternate 2.4 cents
per therm rate. The tax imposed at the alternate tax rate by
this Law shall, when collected, be stated as a distinct and
separate item apart from the selling price of the gas. The
tax collected by any delivering supplier shall constitute a
debt owed by that person to this State. Upon receipt by a
delivering supplier of a copy of a certificate of
registration issued to a self-assessing purchaser under
Section 5-20 of this Law, that delivering supplier is
relieved of the duty to collect the alternate tax from that
self-assessing purchaser beginning with bills issued to that
self-assessing purchaser 30 or more days after receipt of the
copy of that certificate of registration.
Section 5-20. Self-assessing purchaser registration;
certificate of registration. Any purchaser who does not elect
the alternate tax rate to be paid to a delivering supplier
shall register with the Department as a self-assessing
purchaser and pay the tax imposed by Section 5-10 of this Law
directly to the Department at the self-assessing purchaser
rate.
A purchaser registering as a self-assessing purchaser may
not revoke such registration for at least one year
thereafter. Application for a certificate of registration as
a self-assessing purchaser shall be made to the Department
upon forms furnished by the Department and shall contain any
reasonable information that the Department may require. The
self-assessing purchaser shall be required to disclose the
name of the delivering supplier or suppliers who are
delivering the gas upon which the self-assessing purchaser
will be paying tax directly to the Department.
Upon receipt of the application for a certificate of
registration in proper form, the Department shall issue to
the applicant a certificate of registration as a
self-assessing purchaser. The applicant shall provide a copy
of the certificate of registration as a self-assessing
purchaser to the applicant's delivering supplier or
suppliers.
Section 5-25. Self-assessing purchaser; direct return
and payment of tax. Except for purchasers who have chosen the
alternate tax rate to be paid to a delivering supplier
maintaining a place of business in this State, the tax
imposed in Section 5-10 of this Law shall be paid to the
Department directly by each self-assessing purchaser who is
subject to the tax imposed by this Law. Each self-assessing
purchaser shall, on or before the 15th day of each month,
make a return to the Department for the preceding calendar
month, stating the following:
(1) His or her name and principal address.
(2) The total number of therms used by him or her
during the preceding calendar month and upon the basis of
which the tax is imposed.
(3) The purchase price of gas used by him or her
during the preceding calendar month and upon the basis of
which the tax is imposed.
(4) Amount of tax (computed upon items 2 and 3).
(5) Such other reasonable information as the
Department may require.
In making such return, the self-assessing purchaser may
use any reasonable method to derive reportable "therms" and
"purchase price" from his or her billing and payment records.
If the average monthly liability of the self-assessing
purchaser to the Department does not exceed $100, the
Department may authorize his or her returns to be filed on a
quarter-annual basis, with the return for January, February,
and March of a given year being due by April 30 of such year;
with the return for April, May, and June of a given year
being due by July 31 of such year; with the return for July,
August, and September of a given year being due by October 31
of such year; and with the return for October, November, and
December of a given year being due by January 31 of the
following year.
If the average monthly liability of the self-assessing
purchaser to the Department does not exceed $20, the
Department may authorize his or her returns to be filed on a
annual basis, with the return for a given year being due by
January 31 of the following year.
Such quarter-annual and annual returns, as to form and
substance, shall be subject to the same requirements as
monthly returns.
Notwithstanding any other provision in this Law
concerning the time within which a self-assessing purchaser
may file his or her return, in the case of any such
self-assessing purchaser who ceases to engage in a kind of
business which makes him or her responsible for filing
returns under this Law, such person shall file a final return
under this Law with the Department not more than one month
after discontinuing such business.
Each self-assessing purchaser whose average monthly
liability to the Department under this Law was $10,000 or
more during the preceding calendar year, excluding the month
of highest liability and the month of lowest liability in
such calendar year, and who is not operated by a unit of
local government, shall make estimated payments to the
Department on or before the 7th, 15th, 22nd, and last day of
the month during which tax liability to the Department is
incurred in an amount not less than the lower of either 22.5%
of such person's actual tax liability for the month or 25% of
such person's actual tax liability for the same calendar
month of the preceding year. The amount of such
quarter-monthly payments shall be credited against the final
tax liability of the self-assessing purchaser's return for
that month. Any outstanding credit, approved by the
Department, arising from the self-assessing purchaser's
overpayment of his or her final tax liability for any month
may be applied to reduce the amount of any subsequent
quarter-monthly payment or credited against the final tax
liability of such self-assessing purchaser's return for any
subsequent month. If any quarter-monthly payment is not paid
at the time or in the amount required by this Section, such
person shall be liable for penalty and interest on the
difference between the minimum amount due as a payment and
the amount of such payment actually and timely paid, except
insofar as such person has previously made payments for that
month to the Department in excess of the minimum payments
previously due.
The self-assessing purchaser making the return provided
for in this Section shall, at the time of making such return,
pay to the Department the amount of tax imposed by this Law.
All moneys received by the Department under this Law shall be
paid into the General Revenue Fund in the State treasury.
Section 5-30. Registration of delivering suppliers. A
delivering supplier maintaining a place of business in this
State who engages in the delivery of gas in this State shall
register with the Department. A delivering supplier, if
required to register under the Gas Revenue Tax Act, need not
obtain an additional certificate of registration under this
Law, but shall be deemed to be sufficiently registered by
virtue of his being registered under the Gas Revenue Tax Act.
Application for a certificate of registration shall be made
to the Department upon forms furnished by the Department and
shall contain any reasonable information the Department may
require. Upon receipt of the application for a certificate of
registration in proper form, the Department shall issue to
the applicant a certificate of registration. The Department
may deny a certificate of registration to any applicant if
such applicant is in default for moneys due under this Law.
Any person aggrieved by any decision of the Department under
this Section may, within 20 days after notice of such
decision, protest and request a hearing, whereupon the
Department shall give notice to such person of the time and
place fixed for such hearing and shall hold a hearing in
conformity with the provisions of this Law and then issue its
final administrative decision in the matter to such person.
In the absence of such a protest within 20 days, the
Department's decision shall become final without any further
determination being made or notice given.
Section 5-35. Return and payment of tax by delivering
supplier. Each delivering supplier who is required under
Section 5-15 to collect the tax imposed by this Law shall
make a return to the Department on or before the 15th day of
each month for the preceding calendar month stating the
following:
(1) His or her name.
(2) The address of his or her principal place of
business and the address of the principal place of
business (if that is a different address) from which he
or she engages in the business of delivering gas to
persons for use or consumption and not for resale.
(3) The total number of therms of gas delivered to
purchasers during the preceding calendar month and upon
the basis of which the tax is imposed.
(4) Amount of tax computed upon item 3.
(5) Such other reasonable information as the
Department may require.
In making such return the person engaged in the business
of delivering gas to persons for use or consumption and not
for resale may use any reasonable method to derive reportable
"therms" from his or her billing and payment records.
If the average monthly liability to the Department of the
delivering supplier does not exceed $100, the Department may
authorize his or her returns to be filed on a quarter-annual
basis, with the return for January, February, and March of a
given year being due by April 30 of such year; with the
return for April, May, and June of a given year being due by
July 31 of such year; with the return for July, August, and
September of a given year being due by October 31 of such
year; and with the return for October, November, and December
of a given year being due by January 31 of the following
year.
If the average monthly liability to the Department of the
delivering supplier does not exceed $20, the Department may
authorize his or her returns to be filed on an annual basis,
with the return for a given year being due by January 31 of
the following year.
Such quarter-annual and annual returns, as to form and
substance, shall be subject to the same requirements as
monthly returns.
Notwithstanding any other provision in this Law
concerning the time within which a delivering supplier may
file his or her return, in the case of any delivering
supplier who ceases to engage in a kind of business that
makes him or her responsible for filing returns under this
Law, such delivering supplier shall file a final return under
this Law with the Department not more than one month after
discontinuing such business.
Each delivering supplier whose average monthly liability
to the Department under this Law was $10,000 or more during
the preceding calendar year, excluding the month of highest
liability and the month of lowest liability in such calendar
year, and who is not operated by a unit of local government,
shall make estimated payments to the Department on or before
the 7th, 15th, 22nd, and last day of the month during which
tax liability to the Department is incurred in an amount not
less than the lower of either 22.5% of such person's actual
tax liability for the month or 25% of such person's actual
tax liability for the same calendar month of the preceding
year. The amount of such quarter-monthly payments shall be
credited against the final tax liability of such person's
return for that month. Any outstanding credit, approved by
the Department, arising from such person's overpayment of his
or her final tax liability for any month may be applied to
reduce the amount of any subsequent quarter-monthly payment
or credited against the final tax liability of such person's
return for any subsequent month. If any quarter-monthly
payment is not paid at the time or in the amount required by
this Section, such person shall be liable for penalty and
interest on the difference between the minimum amount due as
a payment and the amount of such payment actually and timely
paid, except insofar as such person has previously made
payments for that month to the Department in excess of the
minimum payments previously due.
The delivering supplier making the return provided for in
this Section shall, at the time of making such return, pay to
the Department the amount of tax imposed by this Law. All
moneys received by the Department under this Law shall be
paid into the General Revenue Fund in the State treasury.
Section 5-40. Incorporation of applicable Sections. The
Department shall have full power to administer and enforce
this Law; to collect all taxes, penalties, and interest due
hereunder; to dispose of taxes, penalties, and interest so
collected in the manner hereinafter provided; and to
determine all rights to credit memoranda or refunds arising
on account of the erroneous payment of tax, penalty, or
interest hereunder. In the administration of, and compliance
with, this Section, the Department and persons who are
subject to this Section shall have the same rights, remedies,
privileges, immunities, powers, and duties, be subject to the
same conditions, restrictions, limitations, penalties, and
definitions of terms, and employ the same modes of procedure,
as are prescribed in Sections 2, 4, 5, 6, 7, 9 (except
provisions relating to transaction returns and except that
the due date for returns shall be the 15th day of each month
for the preceding calendar month), 10, 11, 12, 12a, 12b, 13,
14, 15, 18, 19, 20, 21, and 22 of the Use Tax Act, and are
not inconsistent with this Section, as fully as if those
provisions were set forth herein.
Section 5-45. Multistate exemption. To prevent actual
multi-state taxation of the privilege that is subject to
taxation under this Law, any purchaser, upon proof that
purchaser has paid a tax in another state on such event,
shall be allowed a credit against the tax imposed by this
Law, to the extent of the amount of the tax properly due and
paid in the other state.
Section 5-50. Exemptions. The tax imposed under this Act
shall not apply to:
(1) Gas used by business enterprises located in an
enterprise zone certified by the Department of Commerce
and Economic Opportunity pursuant to the Illinois
Enterprise Zone Act;
(2) Gas used by governmental bodies, or a
corporation, society, association, foundation, or
institution organized and operated exclusively for
charitable, religious, or educational purposes. Such use
shall not be exempt unless the government body, or
corporation, society, association, foundation, or
institution organized and operated exclusively for
charitable, religious, or educational purposes has first
been issued a tax exemption identification number by the
Department of Revenue pursuant to Section 1g of the
Retailers' Occupation Tax Act. A limited liability
company may qualify for the exemption under this Section
only if the limited liability company is organized and
operated exclusively for educational purposes. The term
"educational purposes" shall have the same meaning as
that set forth in Section 2h of the Retailers' Occupation
Tax Act;
(3) Gas used in the production of electric energy.
This exemption does not include gas used in the general
maintenance or heating of an electric energy production
facility or other structure;
(4) Gas used in a petroleum refinery operation;
(5) Gas purchased by persons for use in
liquefaction and fractionation processes that produce
value added natural gas byproducts for resale;
(6) Gas used in the production of anhydrous ammonia
and downstream nitrogen fertilizer products for resale.
The Department may adopt rules to implement the
provisions of this Section.
Section 5-905. The Gas Revenue Tax Act is amended by
changing Sections 1 and 2 as follows:
(35 ILCS 615/1) (from Ch. 120, par. 467.16)
Sec. 1. For the purposes of this Act: "Gross receipts"
means the consideration received for gas distributed,
supplied, furnished or sold to persons for use or consumption
and not for resale, and for all services (including the
transportation or storage of gas for an end-user) rendered in
connection therewith, and shall include cash, services and
property of every kind or nature, and shall be determined
without any deduction on account of the cost of the service,
product or commodity supplied, the cost of materials used,
labor or service costs, or any other expense whatsoever.
However, "gross receipts" shall not include receipts from:
(i) any minimum or other charge for gas or gas
service where the customer has taken no therms of gas;
(ii) any charge for a dishonored check;
(iii) any finance or credit charge, penalty or
charge for delayed payment, or discount for prompt
payment;
(iv) any charge for reconnection of service or for
replacement or relocation of facilities;
(v) any advance or contribution in aid of
construction;
(vi) repair, inspection or servicing of equipment
located on customer premises;
(vii) leasing or rental of equipment, the leasing
or rental of which is not necessary to distributing,
furnishing, supplying, selling, transporting or storing
gas;
(viii) any sale to a customer if the taxpayer is
prohibited by federal or State constitution, treaty,
convention, statute or court decision from recovering the
related tax liability from such customer;
(ix) any charges added to customers' bills pursuant
to the provisions of Section 9-221 or Section 9-222 of
the Public Utilities Act, as amended, or any charges
added to customers' bills by taxpayers who are not
subject to rate regulation by the Illinois Commerce
Commission for the purpose of recovering any of the tax
liabilities or other amounts specified in such provisions
of such Act; and
(x) prior to October 1, 2003, any charge for gas or
gas services to a customer who acquired contractual
rights for the direct purchase of gas or gas services
originating from an out-of-state supplier or source on or
before March 1, 1995, except for those charges solely
related to the local distribution of gas by a public
utility. This exemption includes any charge for gas or
gas service, except for those charges solely related to
the local distribution of gas by a public utility, to a
customer who maintained an account with a public utility
(as defined in Section 3-105 of the Public Utilities Act)
for the transportation of customer-owned gas on or before
March 1, 1995. The provisions of this amendatory Act of
1997 are intended to clarify, rather than change,
existing law as to the meaning and scope of this
exemption. This exemption (x) expires on September 30,
2003.
In case credit is extended, the amount thereof shall be
included only as and when payments are received.
"Gross receipts" shall not include consideration received
from business enterprises certified under Section 9-222.1 of
the Public Utilities Act, as amended, to the extent of such
exemption and during the period of time specified by the
Department of Commerce and Community Affairs.
"Department" means the Department of Revenue of the State
of Illinois.
"Director" means the Director of Revenue for the
Department of Revenue of the State of Illinois.
"Taxpayer" means a person engaged in the business of
distributing, supplying, furnishing or selling gas for use or
consumption and not for resale.
"Person" means any natural individual, firm, trust,
estate, partnership, association, joint stock company, joint
adventure, corporation, limited liability company, or a
receiver, trustee, guardian or other representative appointed
by order of any court, or any city, town, county or other
political subdivision of this State.
"Invested capital" means that amount equal to (i) the
average of the balances at the beginning and end of each
taxable period of the taxpayer's total stockholder's equity
and total long-term debt, less investments in and advances to
all corporations, as set forth on the balance sheets included
in the taxpayer's annual report to the Illinois Commerce
Commission for the taxable period; (ii) multiplied by a
fraction determined under Sections 301 and 304(a) of the
"Illinois Income Tax Act" and reported on the Illinois income
tax return for the taxable period ending in or with the
taxable period in question. However, notwithstanding the
income tax return reporting requirement stated above,
beginning July 1, 1979, no taxpayer's denominators used to
compute the sales, property or payroll factors under
subsection (a) of Section 304 of the Illinois Income Tax Act
shall include payroll, property or sales of any corporate
entity other than the taxpayer for the purposes of
determining an allocation for the invested capital tax. This
amendatory Act of 1982, Public Act 82-1024, is not intended
to and does not make any change in the meaning of any
provision of this Act, it having been the intent of the
General Assembly in initially enacting the definition of
"invested capital" to provide for apportionment of the
invested capital of each company, based solely upon the
sales, property and payroll of that company.
"Taxable period" means each period which ends after the
effective date of this Act and which is covered by an annual
report filed by the taxpayer with the Illinois Commerce
Commission.
(Source: P.A. 89-417, eff. 1-1-96; 90-16, eff. 6-16-97.)
(35 ILCS 615/2) (from Ch. 120, par. 467.17)
Sec. 2. A tax is imposed upon persons engaged in the
business of distributing, supplying, furnishing or selling
gas to persons for use or consumption and not for resale at
the rate of 2.4 cents per therm of all gas which is so
distributed, supplied, furnished, sold or transported to or
for each customer in the course of such business, or 5% of
the gross receipts received from each customer from such
business, whichever is the lower rate as applied to each
customer for that customer's billing period, provided that
any change in rate imposed by this amendatory Act of 1985
shall become effective only with bills having a meter reading
date on or after January 1, 1986. However, such taxes are not
imposed with respect to any business in interstate commerce,
or otherwise to the extent to which such business may not,
under the Constitution and statutes of the United States, be
made the subject of taxation by this State.
Nothing in this amendatory Act of 1985 shall impose a tax
with respect to any transaction with respect to which no tax
was imposed immediately preceding the effective date of this
amendatory Act of 1985.
Beginning with bills issued to customers on and after
October 1, 2003, no tax shall be imposed under this Act on
transactions with customers who incur a tax liability under
the Gas Use Tax Law.
(Source: P.A. 84-307; 84-1093.)
Section 5-999. Effective date. This Act takes effect on
October 1, 2003.