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1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Section
511 as follows:
 
6    (35 ILCS 105/11)  (from Ch. 120, par. 439.11)
7    Sec. 11. Every retailer required or authorized to collect
8taxes hereunder and every person using in this State tangible
9personal property purchased at retail from a retailer on or
10after the effective date hereof shall keep such records,
11receipts, invoices and other pertinent books, documents,
12memoranda and papers as the Department shall require, in such
13form as the Department shall require. The Department may adopt
14rules that establish requirements, including record forms and
15formats, for records required to be kept and maintained by
16taxpayers. For purposes of this Section, "records" means all
17data maintained by the taxpayer, including data on paper,
18microfilm, microfiche or any type of machine-sensible data
19compilation. For the purpose of administering and enforcing the
20provisions hereof, the Department, or any officer or employee
21of the Department designated, in writing, by the Director
22thereof, may hold investigations and hearings concerning any
23matters covered herein and may examine any books, papers,

 

 

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1records, documents or memoranda of any retailer or purchaser
2bearing upon the sales or purchases of tangible personal
3property, the privilege of using which is taxed hereunder, and
4may require the attendance of such person or any officer or
5employee of such person, or of any person having knowledge of
6the facts, and may take testimony and require proof for its
7information.
8    Any person who fails to keep books and records or fails to
9produce books and records for examination, as required by this
10Section and the rules adopted by the Department, is liable to
11pay to the Department, for deposit into the Tax Compliance and
12Administration Fund, a penalty of $1,000 for the first failure
13to keep books and records or produce books and records for
14examination and a penalty of $3,000 for each subsequent failure
15to keep books and records or produce books and records for
16examination as required by this Section and the rules adopted
17by the Department. The penalties imposed under this Section
18shall not apply if the taxpayer shows that he or she acted with
19ordinary business care and prudence. The Department may adopt
20rules to administer the penalties under this Section.
21(Source: P.A. 88-480.)
 
22    Section 10. The Service Use Tax Act is amended by changing
23Section 11 as follows:
 
24    (35 ILCS 110/11)  (from Ch. 120, par. 439.41)

 

 

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1    Sec. 11. Every serviceman required or authorized to collect
2taxes hereunder and every user who is subject to the tax
3imposed by this Act shall keep such records, receipts, invoices
4and other pertinent books, documents, memoranda and papers as
5the Department shall require, in such form as the Department
6shall require. The Department may adopt rules that establish
7requirements, including record forms and formats, for records
8required to be kept and maintained by taxpayers. For purposes
9of this Section, "records" means all data maintained by the
10taxpayer, including data on paper, microfilm, microfiche or any
11type of machine-sensible data compilation. For the purpose of
12administering and enforcing the provisions hereof, the
13Department, or any officer or employee of the Department
14designated, in writing, by the Director thereof, may hold
15investigations and hearings concerning any matters covered
16herein and not otherwise delegated to the Illinois Independent
17Tax Tribunal and may examine any relevant books, papers,
18records, documents or memoranda of any serviceman or any
19taxable purchaser for use hereunder, and may require the
20attendance of such person or any officer or employee of such
21person, or of any person having knowledge of the facts, and may
22take testimony and require proof for its information.
23    Any person who fails to keep books and records or fails to
24produce books and records for examination, as required by this
25Section and the rules adopted by the Department, is liable to
26pay to the Department, for deposit into the Tax Compliance and

 

 

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1Administration Fund, a penalty of $1,000 for the first failure
2to keep books and records or produce books and records for
3examination and a penalty of $3,000 for each subsequent failure
4to keep books and records or produce books and records for
5examination as required by this Section and the rules adopted
6by the Department. The penalties imposed under this Section
7shall not apply if the taxpayer shows that he or she acted with
8ordinary business care and prudence. The Department may adopt
9rules to administer the penalties under this Section.
10(Source: P.A. 97-1129, eff. 8-28-12.)
 
11    Section 15. The Service Occupation Tax Act is amended by
12changing Section 11 as follows:
 
13    (35 ILCS 115/11)  (from Ch. 120, par. 439.111)
14    Sec. 11. Every supplier required or authorized to collect
15taxes hereunder and every serviceman making sales of service in
16this State on or after the effective date hereof shall keep
17such records, receipts, invoices and other pertinent books,
18documents, memoranda and papers as the Department shall
19require, in such form as the Department shall require. The
20Department may adopt rules that establish requirements,
21including record forms and formats, for records required to be
22kept and maintained by taxpayers. For purposes of this Section,
23"records" means all data maintained by the taxpayer, including
24data on paper, microfilm, microfiche or any type of

 

 

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1machine-sensible data compilation. For the purpose of
2administering and enforcing the provisions hereof, the
3Department, or any officer or employee of the Department
4designated, in writing, by the Director thereof, may hold
5investigations and hearings not otherwise delegated to the
6Illinois Independent Tax Tribunal concerning any matters
7covered herein and may examine any books, papers, records,
8documents or memoranda of any supplier or serviceman bearing
9upon the sales of services or the sales of tangible personal
10property to servicemen, and may require the attendance of such
11person or any officer or employee of such person, or of any
12person having knowledge of the facts, and may take testimony
13and require proof for its information.
14    Any person who fails to keep books and records or fails to
15produce books and records for examination, as required by this
16Section and the rules adopted by the Department, is liable to
17pay to the Department, for deposit into the Tax Compliance and
18Administration Fund, a penalty of $1,000 for the first failure
19to keep books and records or produce books and records for
20examination and a penalty of $3,000 for each subsequent failure
21to keep books and records or produce books and records for
22examination as required by this Section and the rules adopted
23by the Department. The penalties imposed under this Section
24shall not apply if the taxpayer shows that he or she acted with
25ordinary business care and prudence. The Department may adopt
26rules to administer the penalties under this Section.

 

 

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1(Source: P.A. 97-1129, eff. 8-28-12.)
 
2    Section 20. The Retailers' Occupation Tax Act is amended by
3changing Section 7 as follows:
 
4    (35 ILCS 120/7)  (from Ch. 120, par. 446)
5    Sec. 7. Every person engaged in the business of selling
6tangible personal property at retail in this State shall keep
7records and books of all sales of tangible personal property,
8together with invoices, bills of lading, sales records, copies
9of bills of sale, inventories prepared as of December 31 of
10each year or otherwise annually as has been the custom in the
11specific trade and other pertinent papers and documents. Every
12person who is engaged in the business of selling tangible
13personal property at retail in this State and who, in
14connection with such business, also engages in other activities
15(including, but not limited to, engaging in a service
16occupation) shall keep such additional records and books of all
17such activities as will accurately reflect the character and
18scope of such activities and the amount of receipts realized
19therefrom. The Department may adopt rules that establish
20requirements, including record forms and formats, for records
21required to be kept and maintained by taxpayers. For purposes
22of this Section, "records" means all data maintained by the
23taxpayer, including data on paper, microfilm, microfiche or any
24type of machine-sensible data compilation.

 

 

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1    All books and records and other papers and documents which
2are required by this Act to be kept shall be kept in the
3English language and shall, at all times during business hours
4of the day, be subject to inspection by the Department or its
5duly authorized agents and employees.
6    To support deductions made on the tax return form, or
7authorized under this Act, on account of receipts from isolated
8or occasional sales of tangible personal property, on account
9of receipts from sales of tangible personal property for
10resale, on account of receipts from sales to governmental
11bodies or other exempted types of purchasers, on account of
12receipts from sales of tangible personal property in interstate
13commerce, and on account of receipts from any other kind of
14transaction that is not taxable under this Act, entries in any
15books, records or other pertinent papers or documents of the
16taxpayer in relation thereto shall be in detail sufficient to
17show the name and address of the taxpayer's customer in each
18such transaction, the character of every such transaction, the
19date of every such transaction, the amount of receipts realized
20from every such transaction and such other information as may
21be necessary to establish the non-taxable character of such
22transaction under this Act.
23    Except in the case of a sale to a purchaser who will always
24resell and deliver the property to his customers outside
25Illinois, anyone claiming that he has made a nontaxable sale
26for resale in some form as tangible personal property shall

 

 

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1also keep a record of the purchaser's registration number or
2resale number with the Department.
3    It shall be presumed that all sales of tangible personal
4property are subject to tax under this Act until the contrary
5is established, and the burden of proving that a transaction is
6not taxable hereunder shall be upon the person who would be
7required to remit the tax to the Department if such transaction
8is taxable. In the course of any audit or investigation or
9hearing by the Department with reference to a given taxpayer,
10if the Department finds that the taxpayer lacks documentary
11evidence needed to support the taxpayer's claim to exemption
12from tax hereunder, the Department is authorized to notify the
13taxpayer in writing to produce such evidence, and the taxpayer
14shall have 60 days subject to the right in the Department to
15extend this period either on request for good cause shown or on
16its own motion from the date when such notice is sent to the
17taxpayer by certified or registered mail (or delivered to the
18taxpayer if the notice is served personally) in which to obtain
19and produce such evidence for the Department's inspection,
20failing which the matter shall be closed, and the transaction
21shall be conclusively presumed to be taxable hereunder.
22    Books and records and other papers reflecting gross
23receipts received during any period with respect to which the
24Department is authorized to issue notices of tax liability as
25provided by Sections 4 and 5 of this Act shall be preserved
26until the expiration of such period unless the Department, in

 

 

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1writing, shall authorize their destruction or disposal prior to
2such expiration.
3    Any person who fails to keep books and records or fails to
4produce books and records for examination, as required by this
5Section and the rules adopted by the Department, is liable to
6pay to the Department, for deposit into the Tax Compliance and
7Administration Fund, a penalty of $1,000 for the first failure
8to keep books and records or produce books and records for
9examination and a penalty of $3,000 for each subsequent failure
10to keep books and records or produce books and records for
11examination as required by this Section and the rules adopted
12by the Department. The penalties imposed under this Section
13shall not apply if the taxpayer shows that he or she acted with
14ordinary business care and prudence. The Department may adopt
15rules to administer the penalties under this Section.
16(Source: P.A. 88-480.)
 
17    Section 25. The Cigarette Tax Act is amended by changing
18Sections 12, 13, 14, 15, 18b, and 18c and by adding Sections
1913a, 15a, and 18d as follows:
 
20    (35 ILCS 130/12)  (from Ch. 120, par. 453.12)
21    Sec. 12. Every distributor or secondary distributor who is
22required to procure a license under this Act and who purchases
23cigarettes for shipment into Illinois from a point outside this
24State shall procure invoices in duplicate covering each such

 

 

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1shipment, shall make the invoices available for inspection upon
2demand by a duly authorized employee of the Department, and
3shall, if the Department so requires, furnish one copy of each
4such invoice to the Department at the time of filing a return
5or a report required by this Act.
6(Source: P.A. 96-1027, eff. 7-12-10.)
 
7    (35 ILCS 130/13)  (from Ch. 120, par. 453.13)
8    Sec. 13. Whenever any original package of cigarettes is
9found in the place of business or in the possession of any
10person who is not a licensed distributor under this Act without
11proper stamps affixed thereto, or an authorized substitute
12therefor imprinted thereon, underneath the sealed transparent
13wrapper of such original package, as required by this Act, the
14prima facie presumption shall arise that such original package
15of cigarettes is kept therein or is held by such person in
16violation of the provisions of this Act. If a presumption is
17raised, the Department may, in addition to the penalties
18imposed by Sections 18b and 18c of this Act and any other civil
19or criminal penalties provided for in this Act, assess tax,
20penalty, and interest on the original packages of cigarettes.
21(Source: Laws 1953, p. 255.)
 
22    (35 ILCS 130/13a new)
23    Sec. 13a. Contraband cigarettes. Whenever a retailer
24obtains original packages of cigarettes from an unlicensed

 

 

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1in-state or out-of-state distributor or person, a prima facie
2presumption shall arise that such original packages of
3cigarettes are contraband and are possessed by such retailer or
4were possessed by such retailer in violation of the provisions
5of this Act and subject to the penalties imposed by Sections
618b and 18c of this Act. Invoices or other documents kept in
7the normal course of business in the possession of a retailer
8reflecting purchases of original packages of cigarettes from an
9unlicensed in-state or out-of-state distributor or person or
10invoices or other documents kept in the normal course of
11business obtained by the Department from an in-state or
12out-of-state distributor or person, are sufficient to raise the
13presumption that such original packages of cigarettes are
14contraband and are possessed, or were possessed, by such
15retailer in violation of the provisions of this Act and the
16retailer is subject to the penalties imposed by Sections 18b
17and 18c. If a presumption is raised, the Department may, in
18addition to the penalties imposed by Sections 18b and 18c and
19any other civil or criminal penalties provided for in this Act,
20assess tax, penalty, and interest on the original packages of
21cigarettes.
 
22    (35 ILCS 130/14)  (from Ch. 120, par. 453.14)
23    Sec. 14. Any person required by this Act to keep records of
24any kind whatsoever, who shall fail to keep the records so
25required or who shall falsify such records, shall be guilty of

 

 

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1a Class 4 felony. If a person fails to produce the records for
2inspection by the Department upon request, a prima facie
3presumption shall arise that the person has failed to keep the
4records so required. A person who is unable to rebut this
5presumption is in violation of this Act and is subject to the
6penalties provided in this Section.
7(Source: P.A. 83-1428.)
 
8    (35 ILCS 130/15)  (from Ch. 120, par. 453.15)
9    Sec. 15. Any person who shall fail to safely maintain and
10preserve the records required by Sections Section 11, and
11Section 11a, 11b, and 11c of this Act for the period of 3 three
12years, as required therein, in such manner as to insure
13permanency and accessibility for inspection by the Department,
14shall be guilty of a business offense and may be fined up to
15$5,000.
16(Source: P.A. 96-1027, eff. 7-12-10.)
 
17    (35 ILCS 130/15a new)
18    Sec. 15a. Failure to keep or produce books and records. Any
19person who fails to keep books and records or fails to produce
20books and records for inspection, as required by Sections 11,
2111a, 11b, and 11c of this Act, is liable to pay to the
22Department, for deposit in the Tax Compliance and
23Administration Fund, a penalty of $1,000 for the first failure
24to keep books and records or failure to produce books and

 

 

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1records for inspection, as required by Sections 11, 11a, 11b,
2and 11c, and $3,000 for each subsequent failure to keep books
3and records or failure to produce books and records for
4inspection, as required by Sections 11, 11a, 11b, and 11c. The
5Department may adopt rules to administer the penalties under
6this Section.
 
7    (35 ILCS 130/18b)  (from Ch. 120, par. 453.18b)
8    Sec. 18b. Possession of more than 100 original packages of
9contraband cigarettes; penalty. With the exception of licensed
10distributors and transporters, as defined in Section 9c of this
11Act, possessing unstamped original packages of cigarettes, and
12licensed distributors possessing original packages of
13cigarettes that bear a tax stamp of another state or taxing
14jurisdiction, anyone possessing or having possessed contraband
15cigarettes contained in original packages is liable to pay, to
16the Department for deposit in the Tax Compliance and
17Administration Fund, a penalty of $25 for each such package of
18cigarettes in excess of 100 packages, unless reasonable cause
19can be established by the person upon whom the penalty is
20imposed. This penalty is in addition to the taxes imposed by
21this Act. Reasonable cause shall be determined in each
22situation in accordance with rules adopted by the Department.
23The provisions of the Uniform Penalty and Interest Act do not
24apply to this Section.
25(Source: P.A. 96-782, eff. 1-1-10.)
 

 

 

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1    (35 ILCS 130/18c)
2    Sec. 18c. Possession of not less than 10 and not more than
3100 original packages of contraband cigarettes; penalty. With
4the exception of licensed distributors and transporters, as
5defined in Section 9c of this Act, possessing unstamped
6original packages of cigarettes, and licensed distributors
7possessing original packages of cigarettes that bear a tax
8stamp of another state or taxing jurisdiction, anyone
9possessing or having possessed not less than 10 and not more
10than 100 packages of contraband cigarettes contained in
11original packages is liable to pay to the Department, for
12deposit into the Tax Compliance and Administration Fund, a
13penalty of $15 $10 for each such package of cigarettes, unless
14reasonable cause can be established by the person upon whom the
15penalty is imposed. Reasonable cause shall be determined in
16each situation in accordance with rules adopted by the
17Department. The provisions of the Uniform Penalty and Interest
18Act do not apply to this Section.
19(Source: P.A. 96-782, eff. 1-1-10.)
 
20    (35 ILCS 130/18d new)
21    Sec. 18d. Cigarette package sizes; sale of individual or
22loose cigarettes prohibited. Cigarettes may only be sold in
23packages of 20 or 25 cigarettes. The sale of individual or
24loose cigarettes is prohibited. Any person who violates this

 

 

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1Section of the Act is liable to pay to the Department, for
2deposit in the Tax Compliance and Administration Fund, a
3penalty of $1,000 for the first violation and $3,000 for any
4subsequent violation. Any person who violates this Section
5shall be guilty of a Class 4 felony. The Department may adopt
6rules to administer the penalties under this Section.
 
7    Section 30. The Cigarette Use Tax Act is amended by
8changing Sections 12, 22, 23, 25a, and 25b and by adding
9Sections 8a, 23a, and 25c as follows:
 
10    (35 ILCS 135/8a new)
11    Sec. 8a. Contraband cigarettes. Whenever any person
12obtains original packages of cigarettes from an unlicensed
13in-state or out-of-state distributor or person, a prima facie
14presumption shall arise that such original packages of
15cigarettes are contraband and are possessed or were possessed
16by such person in violation of the provisions of this Act and
17subject to the penalties imposed by Sections 25a and 25b.
18Invoices or other documents kept in the normal course of
19business in the possession of a person reflecting purchases of
20original packages of cigarettes from an unlicensed in-state or
21out-of-state distributor or person or invoices or other
22documents kept in the normal course of business obtained by the
23Department from an in-state or out-of-state distributor or
24person, are sufficient to raise the presumption that such

 

 

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1original packages of cigarettes are contraband and are
2possessed, or were possessed, by such person in violation of
3the provisions of this Act and the person is subject to the
4penalties imposed by Sections 25a and 25b. If a presumption is
5raised, the Department may, in addition to the penalties
6imposed by Sections 25a and 25b and any other civil or criminal
7penalties provided for in this Act, assess tax, penalty, and
8interest on the original packages of cigarettes.
 
9    (35 ILCS 135/12)  (from Ch. 120, par. 453.42)
10    Sec. 12. Declaration of possession of cigarettes on which
11tax not paid.
12    (a) When cigarettes are acquired for use in this State by a
13person (including a distributor as well as any other person),
14who did not pay the tax herein imposed to a distributor, the
15person, within 30 days after acquiring the cigarettes, shall
16file with the Department a return declaring the possession of
17the cigarettes and shall transmit with the return to the
18Department the tax imposed by this Act.
19    (b) On receipt of the return and payment of the tax as
20required by paragraph (a), the Department may furnish the
21person with a suitable tax stamp to be affixed to the package
22of cigarettes upon which the tax has been paid if the
23Department determines that the cigarettes still exist.
24    (c) The return referred to in paragraph (a) shall contain
25the name and address of the person possessing the cigarettes

 

 

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1involved, the location of the cigarettes and the quantity,
2brand name, place, and date of the acquisition of the
3cigarettes.
4    (d) Nothing in this Section shall permit a secondary
5distributor to purchase unstamped original packages of
6cigarettes or to purchase original packages of cigarettes from
7a person other than a licensed distributor.
8    (e) Any distributor who violates this Section is liable to
9pay to the Department, for deposit in the Tax Compliance and
10Administration Fund, a penalty of $1,000 for the first
11violation and $3,000 for any subsequent violation. The
12Department may adopt rules to administer the penalties under
13this Section. The Department may, in addition to the penalties
14imposed by this Section, and any other civil or criminal
15penalties provided for in this Act, assess tax, penalty, and
16interest on the original packages of cigarettes.
17(Source: P.A. 96-1027, eff. 7-12-10.)
 
18    (35 ILCS 135/22)  (from Ch. 120, par. 453.52)
19    Sec. 22. Any person required by this Act to maintain or
20keep records of any kind whatsoever, who shall fail to keep the
21records so required or who shall falsify such records, shall be
22guilty of a Class 4 felony A misdemeanor. If a person fails to
23produce the records for inspection by the Department upon
24request, a prima facie presumption shall arise that the person
25has failed to keep the records so required. A person who is

 

 

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1unable to rebut this presumption is in violation of this Act
2and is subject to the penalties provided in this Section.
3    This Section shall not apply if the violation in a
4particular case also constitutes a criminal violation of the
5Cigarette Tax Act.
6(Source: P.A. 77-2229.)
 
7    (35 ILCS 135/23)  (from Ch. 120, par. 453.53)
8    Sec. 23. Any person who shall fail to safely preserve the
9records required by Section 15 and Section 15a of this Act for
10the period of three (3) years, as required therein, in such
11manner as to insure permanency and accessibility for inspection
12by the Department, shall be guilty of a business offense and
13may be fined up to $5,000 One Thousand Dollars ($1000).
14    This Section shall not apply if the violation in a
15particular case also constitutes a criminal violation of the
16Cigarette Tax Act.
17(Source: P.A. 96-1027, eff. 7-12-10.)
 
18    (35 ILCS 135/23a new)
19    Sec. 23a. Failure to keep or produce books and records. Any
20person who fails to keep books and records or fails to produce
21books and records for inspection, as required by Sections 15
22and 15a of this Act, is liable to pay to the Department, for
23deposit in the Tax Compliance and Administration Fund, a
24penalty of $1,000 for the first failure to keep books and

 

 

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1records or failure to produce books and records for inspection,
2as required by Sections 15 and 15a, and $3,000 for each
3subsequent failure to keep books and records or failure to
4produce books and records for inspection, as required by
5Sections 15 and 15a. The Department may adopt rules to
6administer the penalties under this Section.
 
7    (35 ILCS 135/25a)  (from Ch. 120, par. 453.55a)
8    Sec. 25a. Possession of more than 100 original packages of
9contraband cigarettes; penalty. With the exception of licensed
10distributors or transporters, as defined in Section 9c of the
11Cigarette Tax Act, possessing unstamped original packages of
12cigarettes, and licensed distributors possessing original
13packages of cigarettes that bear a tax stamp of another state
14or taxing jurisdiction, anyone possessing or having possessed
15more than 100 packages of contraband cigarettes contained in
16original packages is liable to pay, to the Department for
17deposit into the Tax Compliance and Administration Fund, a
18penalty of $25 for each such package of cigarettes in excess of
19100 packages, unless reasonable cause can be established by the
20person upon whom the penalty is imposed. Reasonable cause shall
21be determined in each situation in accordance with rules
22adopted by the Department. The provisions of the Uniform
23Penalty and Interest Act do not apply to this Section.
24(Source: P.A. 96-782, eff. 1-1-10.)
 

 

 

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1    (35 ILCS 135/25b)
2    Sec. 25b. Possession of not less than 10 and not more than
3100 original packages not tax stamped or improperly tax
4stamped; penalty. With the exception of licensed distributors
5and transporters, as defined in Section 9c of the Cigarette Tax
6Act, possessing unstamped packages of cigarettes, and licensed
7distributors possessing original packages of cigarettes that
8bear a tax stamp of another state or taxing jurisdiction,
9anyone possessing or having possessed not less than 10 and not
10more than 100 packages of contraband cigarettes contained in
11original packages is liable to pay to the Department, for
12deposit into the Tax Compliance and Administration Fund, a
13penalty of $20 for each such package of cigarettes, unless
14reasonable cause can be established by the person upon whom the
15penalty is imposed. Reasonable cause shall be determined in
16each situation in accordance with rules adopted by the
17Department. Any person who purchases and possesses a total of 9
18or fewer original packages of unstamped cigarettes per month is
19exempt from the penalties of this Section. The provisions of
20the Uniform Penalty and Interest Act do not apply to this
21Section.
22(Source: P.A. 96-782, eff. 1-1-10.)
 
23    (35 ILCS 135/25c new)
24    Sec. 25c. Cigarette package sizes; sale of individual or
25loose cigarettes prohibited. Cigarettes may only be sold in

 

 

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1packages of 20 or 25 cigarettes. The sale of individual or
2loose cigarettes is prohibited. Any person who violates this
3Section is liable to pay to the Department, for deposit in the
4Tax Compliance and Administration Fund, a penalty of $1,000 for
5the first violation and $3,000 for any subsequent violation.
6Any person who violates this Section shall be guilty of a Class
74 felony. This Section shall not apply if the violation in a
8particular case also constitutes a violation of the Cigarette
9Tax Act.
 
10    Section 35. The Tobacco Products Tax Act of 1995 is amended
11by changing Sections 10-25, 10-35, 10-37, 10-40, and 10-50 and
12by adding Sections 10-35a and 10-38 as follows:
 
13    (35 ILCS 143/10-25)
14    Sec. 10-25. License actions.
15    (a) The Department may, after notice and a hearing, revoke,
16cancel, or suspend the license of any distributor or retailer
17who violates any of the provisions of this Act, fails to keep
18books and records as required under this Act, fails to make
19books and records available for inspection upon demand by a
20duly authorized employee of the Department, or violates a rule
21or regulation of the Department for the administration and
22enforcement of this Act. The notice shall specify the alleged
23violation or violations upon which the revocation,
24cancellation, or suspension proceeding is based.

 

 

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1    (b) The Department may revoke, cancel, or suspend the
2license of any distributor for a violation of the Tobacco
3Product Manufacturers' Escrow Enforcement Act as provided in
4Section 20 of that Act.
5    (c) If the retailer has a training program that facilitates
6compliance with minimum-age tobacco laws, the Department shall
7suspend for 3 days the license of that retailer for a fourth or
8subsequent violation of the Prevention of Tobacco Use by Minors
9and Sale and Distribution of Tobacco Products Act, as provided
10in subsection (a) of Section 2 of that Act. For the purposes of
11this Section, any violation of subsection (a) of Section 2 of
12the Prevention of Tobacco Use by Minors and Sale and
13Distribution of Tobacco Products Act occurring at the
14retailer's licensed location, during a 24-month period, shall
15be counted as a violation against the retailer.
16    If the retailer does not have a training program that
17facilitates compliance with minimum-age tobacco laws, the
18Department shall suspend for 3 days the license of that
19retailer for a second violation of the Prevention of Tobacco
20Use by Minors and Sale and Distribution of Tobacco Products
21Act, as provided in subsection (a-5) of Section 2 of that Act.
22    If the retailer does not have a training program that
23facilitates compliance with minimum-age tobacco laws, the
24Department shall suspend for 7 days the license of that
25retailer for a third violation of the Prevention of Tobacco Use
26by Minors and Sale and Distribution of Tobacco Products Act, as

 

 

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1provided in subsection (a-5) of Section 2 of that Act.
2    If the retailer does not have a training program that
3facilitates compliance with minimum-age tobacco laws, the
4Department shall suspend for 30 days the license of a retailer
5for a fourth or subsequent violation of the Prevention of
6Tobacco Use by Minors and Sale and Distribution of Tobacco
7Products Act, as provided in subsection (a-5) of Section 2 of
8that Act.
9    A training program that facilitates compliance with
10minimum-age tobacco laws must include at least the following
11elements: (i) it must explain that only individuals displaying
12valid identification demonstrating that they are 18 years of
13age or older shall be eligible to purchase cigarettes or
14tobacco products and (ii) it must explain where a clerk can
15check identification for a date of birth. The training may be
16conducted electronically. Each retailer that has a training
17program shall require each employee who completes the training
18program to sign a form attesting that the employee has received
19and completed tobacco training. The form shall be kept in the
20employee's file and may be used to provide proof of training.
21    (d) The Department may, by application to any circuit
22court, obtain an injunction restraining any person who engages
23in business as a distributor of tobacco products without a
24license (either because his or her license has been revoked,
25canceled, or suspended or because of a failure to obtain a
26license in the first instance) from engaging in that business

 

 

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1until that person, as if that person were a new applicant for a
2license, complies with all of the conditions, restrictions, and
3requirements of Section 10-20 of this Act and qualifies for and
4obtains a license. Refusal or neglect to obey the order of the
5court may result in punishment for contempt.
6(Source: P.A. 98-1055, eff. 1-1-16; 99-192, eff. 1-1-16.)
 
7    (35 ILCS 143/10-35)
8    Sec. 10-35. Record keeping.
9    (a) Every distributor, as defined in Section 10-5, shall
10keep complete and accurate records of tobacco products held,
11purchased, manufactured, brought in or caused to be brought in
12from without the State, and tobacco products sold, or otherwise
13disposed of, and shall preserve and keep all invoices, bills of
14lading, sales records, and copies of bills of sale, the
15wholesale price for tobacco products sold or otherwise disposed
16of, an inventory of tobacco products prepared as of December 31
17of each year or as of the last day of the distributor's fiscal
18year if he or she files federal income tax returns on the basis
19of a fiscal year, and other pertinent papers and documents
20relating to the manufacture, purchase, sale, or disposition of
21tobacco products. Every sales invoice issued by a licensed
22distributor to a retailer in this State shall contain the
23distributor's Tobacco Products License number unless the
24distributor has been granted a waiver by the Department in
25response to a written request in cases where (i) the

 

 

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1distributor sells little cigars or other tobacco products only
2to licensed retailers that are wholly-owned by the distributor
3or owned by a wholly-owned subsidiary of the distributor; (ii)
4the licensed retailer obtains little cigars or other tobacco
5products only from the distributor requesting the waiver; and
6(iii) the distributor affixes the tax stamps to the original
7packages of little cigars or has or will pay the tax on the
8other tobacco products sold to the licensed retailer. The
9distributor shall file a written request with the Department,
10and, if the Department determines that the distributor meets
11the conditions for a waiver, the Department shall grant the
12waiver.
13    (b) Every retailer, as defined in Section 10-5, whether or
14not the retailer has obtained a retailer's license pursuant to
15Section 4g, shall keep complete and accurate records of tobacco
16products held, purchased, sold, or otherwise disposed of, and
17shall preserve and keep all invoices, bills of lading, sales
18records, and copies of bills of sale, returns and other
19pertinent papers and documents relating to the purchase, sale,
20or disposition of tobacco products. Such records need not be
21maintained on the licensed premises, but must be maintained in
22the State of Illinois; however, if access is available
23electronically, the records may be maintained out of state.
24However, all original invoices or copies thereof covering
25purchases of tobacco products must be retained on the licensed
26premises for a period of 90 days after such purchase, unless

 

 

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1the Department has granted a waiver in response to a written
2request in cases where records are kept at a central business
3location within the State of Illinois or in cases where records
4that are available electronically are maintained out of state.
5The Department shall adopt rules regarding the eligibility for
6a waiver, revocation of a waiver, and requirements and
7standards for maintenance and accessibility of records located
8at a central location out-of-State pursuant to a waiver
9provided under this Section.
10    (c) Books, records, papers, and documents that are required
11by this Act to be kept shall, at all times during the usual
12business hours of the day, be subject to inspection by the
13Department or its duly authorized agents and employees. The
14books, records, papers, and documents for any period with
15respect to which the Department is authorized to issue a notice
16of tax liability shall be preserved until the expiration of
17that period.
18(Source: P.A. 98-1055, eff. 1-1-16; 99-192, eff. 1-1-16.)
 
19    (35 ILCS 143/10-35a new)
20    Sec. 10-35a. Failure to keep or produce books and records.
21Any person who fails to keep books and records or fails to
22produce books and records for inspection, as required by
23Section 10-35, is liable to pay to the Department, for deposit
24in the Tax Compliance and Administration Fund, a penalty of
25$1,000 for the first failure to keep books and records or

 

 

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1failure to produce books and records for inspection, as
2required by Section 10-35, and $3,000 for each subsequent
3failure to keep books and records or failure to produce books
4and records for inspection, as required by Section 10-35. The
5Department may adopt rules to administer the penalties under
6this Section.
 
7    (35 ILCS 143/10-37)
8    Sec. 10-37. Proof of payment of tax imposed by this Act.
9Every licensed distributor of tobacco products in this State is
10required to show proof of the tax having been paid as required
11by this Act by displaying its Tobacco Products License number
12on every sales invoice issued to a retailer in this State. No
13retailer shall possess tobacco products without either a proper
14invoice indicating that the tobacco products tax was paid by a
15distributor for the tobacco products in the retailer's
16possession or other proof that the tax was paid by the retailer
17if it has purchased tobacco products on which tax has not been
18paid as required by this Act. Failure to comply with the
19provisions of this paragraph may be grounds for revocation of a
20distributor's or retailer's license in accordance with Section
2110-25 of this Act or Section 6 of the Cigarette Tax Act. In
22addition, the Department may impose a civil penalty not to
23exceed $1,000 for the first violation and $3,000 for each
24subsequent violation, which shall be deposited into the Tax
25Compliance and Administration Fund.

 

 

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1(Source: P.A. 98-1055, eff. 1-1-16.)
 
2    (35 ILCS 143/10-38 new)
3    Sec. 10-38. Presumption for unlicensed distributors or
4persons. Whenever any person obtains tobacco products from an
5unlicensed in-state or out-of-state distributor or person, a
6prima facie presumption shall arise that the tax imposed by
7this Act on such tobacco products has not been paid in
8violation of this Act. Invoices or other documents kept in the
9normal course of business in the possession of a person
10reflecting purchases of tobacco products from an unlicensed
11in-state or out-of-state distributor or person or invoices or
12other documents kept in the normal course of business obtained
13by the Department from in-state or out-of-state distributors or
14persons, are sufficient to raise the presumption that the tax
15imposed by this Act has not been paid. If a presumption is
16raised, the Department may assess tax, penalty, and interest on
17the tobacco products. In addition, any person who violates this
18Section is liable to pay to the Department, for deposit in the
19Tax Compliance and Administration Fund, a penalty of $1,000 for
20the first violation and $3,000 for any subsequent violation.
21The Department may adopt rules to administer the penalties
22under this Section.
 
23    (35 ILCS 143/10-40)
24    Sec. 10-40. Invoices. Every distributor or other person who

 

 

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1purchases tobacco products for resale for shipment into
2Illinois from a point outside Illinois shall procure invoices
3in duplicate covering each shipment and shall make the invoices
4available for inspection upon demand by a duly authorized
5employee of the Department, and shall, if the Department so
6requires, furnish one copy of each invoice to the Department at
7the time of filing the return required by this Act.
8(Source: P.A. 89-21, eff. 6-6-95.)
 
9    (35 ILCS 143/10-50)
10    Sec. 10-50. Violations and penalties. When the amount due
11is under $300, any distributor who fails to file a return,
12willfully fails or refuses to make any payment to the
13Department of the tax imposed by this Act, or files a
14fraudulent return, or any officer or agent of a corporation
15engaged in the business of distributing tobacco products to
16retailers and consumers located in this State who signs a
17fraudulent return filed on behalf of the corporation, or any
18accountant or other agent who knowingly enters false
19information on the return of any taxpayer under this Act is
20guilty of a Class 4 felony.
21    Any person who violates any provision of Section 10-20,
2210-21, or 10-22 of this Act, fails to keep books and records as
23required under this Act, or willfully violates a rule or
24regulation of the Department for the administration and
25enforcement of this Act is guilty of a Class 4 felony. A person

 

 

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1commits a separate offense on each day that he or she engages
2in business in violation of Section 10-20, 10-21, or 10-22 of
3this Act. If a person fails to produce the books and records
4for inspection by the Department upon request, a prima facie
5presumption shall arise that the person has failed to keep
6books and records as required under this Act. A person who is
7unable to rebut this presumption is in violation of this Act
8and is subject to the penalties provided in this Section.
9    When the amount due is under $300, any person who accepts
10money that is due to the Department under this Act from a
11taxpayer for the purpose of acting as the taxpayer's agent to
12make the payment to the Department, but who fails to remit the
13payment to the Department when due, is guilty of a Class 4
14felony.
15    Any person who violates any provision of Sections 10-20,
1610-21 and 10-22 of this Act, fails to keep books and records as
17required under this Act, or willfully violates a rule or
18regulation of the Department for the administration and
19enforcement of this Act is guilty of a business offense and may
20be fined up to $5,000. If a person fails to produce books and
21records for inspection by the Department upon request, a prima
22facie presumption shall arise that the person has failed to
23keep books and records as required under this Act. A person who
24is unable to rebut this presumption is in violation of this Act
25and is subject to the penalties provided in this Section. A
26person commits a separate offense on each day that he or she

 

 

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1engages in business in violation of Sections 10-20, 10-21 and
210-22 of this Act.
3    When the amount due is $300 or more, any distributor who
4files, or causes to be filed, a fraudulent return, or any
5officer or agent of a corporation engaged in the business of
6distributing tobacco products to retailers and consumers
7located in this State who files or causes to be filed or signs
8or causes to be signed a fraudulent return filed on behalf of
9the corporation, or any accountant or other agent who knowingly
10enters false information on the return of any taxpayer under
11this Act is guilty of a Class 3 felony.
12    When the amount due is $300 or more, any person engaged in
13the business of distributing tobacco products to retailers and
14consumers located in this State who fails to file a return,
15willfully fails or refuses to make any payment to the
16Department of the tax imposed by this Act, or accepts money
17that is due to the Department under this Act from a taxpayer
18for the purpose of acting as the taxpayer's agent to make
19payment to the Department but fails to remit such payment to
20the Department when due is guilty of a Class 3 felony.
21    When the amount due is under $300, any retailer who fails
22to file a return, willfully fails or refuses to make any
23payment to the Department of the tax imposed by this Act, or
24files a fraudulent return, or any officer or agent of a
25corporation engaged in the retail business of selling tobacco
26products to purchasers of tobacco products for use and

 

 

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1consumption located in this State who signs a fraudulent return
2filed on behalf of the corporation, or any accountant or other
3agent who knowingly enters false information on the return of
4any taxpayer under this Act is guilty of a Class A misdemeanor
5for a first offense and a Class 4 felony for each subsequent
6offense.
7    When the amount due is $300 or more, any retailer who fails
8to file a return, willfully fails or refuses to make any
9payment to the Department of the tax imposed by this Act, or
10files a fraudulent return, or any officer or agent of a
11corporation engaged in the retail business of selling tobacco
12products to purchasers of tobacco products for use and
13consumption located in this State who signs a fraudulent return
14filed on behalf of the corporation, or any accountant or other
15agent who knowingly enters false information on the return of
16any taxpayer under this Act is guilty of a Class 4 felony.
17    Any person whose principal place of business is in this
18State and who is charged with a violation under this Section
19shall be tried in the county where his or her principal place
20of business is located unless he or she asserts a right to be
21tried in another venue. If the taxpayer does not have his or
22her principal place of business in this State, however, the
23hearing must be held in Sangamon County unless the taxpayer
24asserts a right to be tried in another venue.
25    Any taxpayer or agent of a taxpayer who with the intent to
26defraud purports to make a payment due to the Department by

 

 

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1issuing or delivering a check or other order upon a real or
2fictitious depository for the payment of money, knowing that it
3will not be paid by the depository, is guilty of a deceptive
4practice in violation of Section 17-1 of the Criminal Code of
52012.
6    A prosecution for a violation described in this Section may
7be commenced within 3 years after the commission of the act
8constituting the violation.
9(Source: P.A. 100-201, eff. 8-18-17.)
 
10    (35 ILCS 143/10-36 rep.)
11    Section 40. The Tobacco Products Tax Act of 1995 is amended
12by repealing Section 10-36.
 
13    Section 99. Effective date. This Act takes effect upon
14becoming law.