Rep. Frank J. Mautino

Filed: 5/26/2011

 

 


 

 


 
09700SB0109ham001LRB097 00079 HLH 56285 a

1
AMENDMENT TO SENATE BILL 109

2    AMENDMENT NO. ______. Amend Senate Bill 109 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Cigarette Tax Act is amended by changing
5Sections 1, 2, 4d, 7, 8, 9, 10, and 23 and by adding Sections
64f, 9f, and 11b as follows:
 
7    (35 ILCS 130/1)  (from Ch. 120, par. 453.1)
8    Sec. 1. For the purposes of this Act:
9    "Brand Style" means a variety of cigarettes distinguished
10by the tobacco used, tar and nicotine content, flavoring used,
11size of the cigarette, filtration on the cigarette or
12packaging.
13    "Cigarette", means any roll for smoking made wholly or in
14part of tobacco irrespective of size or shape and whether or
15not such tobacco is flavored, adulterated or mixed with any
16other ingredient, and the wrapper or cover of which is made of

 

 

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1paper or any other substance or material except tobacco.
2    "Contraband cigarettes" means:
3        (a) cigarettes that do not bear a required tax stamp
4    under this Act;
5        (b) cigarettes for which any required federal taxes
6    have not been paid;
7        (c) cigarettes that bear a counterfeit tax stamp;
8        (d) cigarettes that are manufactured, fabricated,
9    assembled, processed, packaged, or labeled by any person
10    other than (i) the owner of the trademark rights in the
11    cigarette brand or (ii) a person that is directly or
12    indirectly authorized by such owner;
13        (e) cigarettes imported into the United States, or
14    otherwise distributed, in violation of the federal
15    Imported Cigarette Compliance Act of 2000 (Title IV of
16    Public Law 106-476);
17        (f) cigarettes that have false manufacturing labels;
18        (g) cigarettes identified in Section 3-10(a)(1) of
19    this Act; or
20        (h) cigarettes that are improperly tax stamped,
21    including cigarettes that bear a tax stamp of another state
22    or taxing jurisdiction.
23    "Person" means any natural individual, firm, partnership,
24association, joint stock company, joint adventure, public or
25private corporation, however formed, limited liability
26company, or a receiver, executor, administrator, trustee,

 

 

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1guardian or other representative appointed by order of any
2court.
3    "Prior Continuous Compliance Taxpayer" means any person
4who is licensed under this Act and who, having been a licensee
5for a continuous period of 5 years, is determined by the
6Department not to have been either delinquent or deficient in
7the payment of tax liability during that period or otherwise in
8violation of this Act. Also, any taxpayer who has, as verified
9by the Department, continuously complied with the condition of
10his bond or other security under provisions of this Act for a
11period of 5 consecutive years shall be considered to be a
12"Prior continuous compliance taxpayer". In calculating the
13consecutive period of time described herein for qualification
14as a "prior continuous compliance taxpayer", a consecutive
15period of time of qualifying compliance immediately prior to
16the effective date of this amendatory Act of 1987 shall be
17credited to any licensee who became licensed on or before the
18effective date of this amendatory Act of 1987.
19    "Department" means the Department of Revenue.
20    "Sale" means any transfer, exchange or barter in any manner
21or by any means whatsoever for a consideration, and includes
22and means all sales made by any person.
23    "Original Package" means the individual packet, box or
24other container whatsoever used to contain and to convey
25cigarettes to the consumer.
26    "Distributor" means any and each of the following:

 

 

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1    (1) Any person engaged in the business of selling
2cigarettes in this State who brings or causes to be brought
3into this State from without this State any original packages
4of cigarettes, on which original packages there is no
5authorized evidence underneath a sealed transparent wrapper
6showing that the tax liability imposed by this Act has been
7paid or assumed by the out-of-State seller of such cigarettes,
8for sale or other disposition in the course of such business.
9    (2) Any person who makes, manufactures or fabricates
10cigarettes in this State for sale in this State, except a
11person who makes, manufactures or fabricates cigarettes as a
12part of a correctional industries program for sale to residents
13incarcerated in penal institutions or resident patients of a
14State-operated mental health facility.
15    (3) Any person who makes, manufactures or fabricates
16cigarettes outside this State, which cigarettes are placed in
17original packages contained in sealed transparent wrappers,
18for delivery or shipment into this State, and who elects to
19qualify and is accepted by the Department as a distributor
20under Section 4b of this Act.
21    "Place of business" shall mean and include any place where
22cigarettes are sold or where cigarettes are manufactured,
23stored or kept for the purpose of sale or consumption,
24including any vessel, vehicle, airplane, train or vending
25machine.
26    "Manufacturer representative" means a director, officer,

 

 

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1or employee of a manufacturer who has obtained authority from
2the Department under Section 4f to maintain representatives in
3Illinois that provide or sell original packages of cigarettes
4made, manufactured, or fabricated by the manufacturer to
5retailers in compliance with Section 4f of this Act to promote
6cigarettes made, manufactured, or fabricated by the
7manufacturer.
8    "Business" means any trade, occupation, activity or
9enterprise engaged in for the purpose of selling cigarettes in
10this State.
11    "Retailer" means any person who engages in the making of
12transfers of the ownership of, or title to, cigarettes to a
13purchaser for use or consumption and not for resale in any
14form, for a valuable consideration. "Retailer" does not include
15a person:
16        (1) who transfers to residents incarcerated in penal
17    institutions or resident patients of a State-operated
18    mental health facility ownership of cigarettes made,
19    manufactured, or fabricated as part of a correctional
20    industries program; or
21        (2) who transfers cigarettes to a not-for-profit
22    research institution that conducts tests concerning the
23    health effects of tobacco products and who does not offer
24    the cigarettes for resale.
25    "Retailer" shall be construed to include any person who
26engages in the making of transfers of the ownership of, or

 

 

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1title to, cigarettes to a purchaser, for use or consumption by
2any other person to whom such purchaser may transfer the
3cigarettes without a valuable consideration, except a person
4who transfers to residents incarcerated in penal institutions
5or resident patients of a State-operated mental health facility
6ownership of cigarettes made, manufactured or fabricated as
7part of a correctional industries program.
8    "Secondary distributor" means any person engaged in the
9business of selling cigarettes who purchases stamped original
10packages of cigarettes from a licensed distributor under this
11Act or the Cigarette Use Tax Act, sells 75% or more of those
12cigarettes to retailers for resale, and maintains an
13established business where a substantial stock of cigarettes is
14available to retailers for resale.
15    "Stamp" or "stamps" mean the indicia required to be affixed
16on a pack of cigarettes that evidence payment of the tax on
17cigarettes under Section 2 of this Act.
18    "Related party" means any person that is associated with
19any other person because he or she:
20        (a) is an officer or director of a business; or
21        (b) is legally recognized as a partner in business.
22(Source: P.A. 95-462, eff. 8-27-07; 95-1053, eff. 1-1-10;
2396-782, eff. 1-1-10; 96-1027, eff. 7-12-10.)
 
24    (35 ILCS 130/2)  (from Ch. 120, par. 453.2)
25    Sec. 2. Tax imposed; rate; collection, payment, and

 

 

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1distribution; discount.
2    (a) A tax is imposed upon any person engaged in business as
3a retailer of cigarettes in this State at the rate of 5 1/2
4mills per cigarette sold, or otherwise disposed of in the
5course of such business in this State. In addition to any other
6tax imposed by this Act, a tax is imposed upon any person
7engaged in business as a retailer of cigarettes in this State
8at a rate of 1/2 mill per cigarette sold or otherwise disposed
9of in the course of such business in this State on and after
10January 1, 1947, and shall be paid into the Metropolitan Fair
11and Exposition Authority Reconstruction Fund or as otherwise
12provided in Section 29. On and after December 1, 1985, in
13addition to any other tax imposed by this Act, a tax is imposed
14upon any person engaged in business as a retailer of cigarettes
15in this State at a rate of 4 mills per cigarette sold or
16otherwise disposed of in the course of such business in this
17State. Of the additional tax imposed by this amendatory Act of
181985, $9,000,000 of the moneys received by the Department of
19Revenue pursuant to this Act shall be paid each month into the
20Common School Fund. On and after the effective date of this
21amendatory Act of 1989, in addition to any other tax imposed by
22this Act, a tax is imposed upon any person engaged in business
23as a retailer of cigarettes at the rate of 5 mills per
24cigarette sold or otherwise disposed of in the course of such
25business in this State. On and after the effective date of this
26amendatory Act of 1993, in addition to any other tax imposed by

 

 

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1this Act, a tax is imposed upon any person engaged in business
2as a retailer of cigarettes at the rate of 7 mills per
3cigarette sold or otherwise disposed of in the course of such
4business in this State. On and after December 15, 1997, in
5addition to any other tax imposed by this Act, a tax is imposed
6upon any person engaged in business as a retailer of cigarettes
7at the rate of 7 mills per cigarette sold or otherwise disposed
8of in the course of such business of this State. All of the
9moneys received by the Department of Revenue pursuant to this
10Act and the Cigarette Use Tax Act from the additional taxes
11imposed by this amendatory Act of 1997, shall be paid each
12month into the Common School Fund. On and after July 1, 2002,
13in addition to any other tax imposed by this Act, a tax is
14imposed upon any person engaged in business as a retailer of
15cigarettes at the rate of 20.0 mills per cigarette sold or
16otherwise disposed of in the course of such business in this
17State. The payment of such taxes shall be evidenced by a stamp
18affixed to each original package of cigarettes, or an
19authorized substitute for such stamp imprinted on each original
20package of such cigarettes underneath the sealed transparent
21outside wrapper of such original package, as hereinafter
22provided. However, such taxes are not imposed upon any activity
23in such business in interstate commerce or otherwise, which
24activity may not under the Constitution and statutes of the
25United States be made the subject of taxation by this State.
26    Beginning on the effective date of this amendatory Act of

 

 

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1the 92nd General Assembly and through June 30, 2006, all of the
2moneys received by the Department of Revenue pursuant to this
3Act and the Cigarette Use Tax Act, other than the moneys that
4are dedicated to the Common School Fund, shall be distributed
5each month as follows: first, there shall be paid into the
6General Revenue Fund an amount which, when added to the amount
7paid into the Common School Fund for that month, equals
8$33,300,000, except that in the month of August of 2004, this
9amount shall equal $83,300,000; then, from the moneys
10remaining, if any amounts required to be paid into the General
11Revenue Fund in previous months remain unpaid, those amounts
12shall be paid into the General Revenue Fund; then, beginning on
13April 1, 2003, from the moneys remaining, $5,000,000 per month
14shall be paid into the School Infrastructure Fund; then, if any
15amounts required to be paid into the School Infrastructure Fund
16in previous months remain unpaid, those amounts shall be paid
17into the School Infrastructure Fund; then the moneys remaining,
18if any, shall be paid into the Long-Term Care Provider Fund. To
19the extent that more than $25,000,000 has been paid into the
20General Revenue Fund and Common School Fund per month for the
21period of July 1, 1993 through the effective date of this
22amendatory Act of 1994 from combined receipts of the Cigarette
23Tax Act and the Cigarette Use Tax Act, notwithstanding the
24distribution provided in this Section, the Department of
25Revenue is hereby directed to adjust the distribution provided
26in this Section to increase the next monthly payments to the

 

 

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1Long Term Care Provider Fund by the amount paid to the General
2Revenue Fund and Common School Fund in excess of $25,000,000
3per month and to decrease the next monthly payments to the
4General Revenue Fund and Common School Fund by that same excess
5amount.
6    Beginning on July 1, 2006, all of the moneys received by
7the Department of Revenue pursuant to this Act and the
8Cigarette Use Tax Act, other than the moneys that are dedicated
9to the Common School Fund, shall be distributed each month as
10follows: first, there shall be paid into the General Revenue
11Fund an amount that, when added to the amount paid into the
12Common School Fund for that month, equals $29,200,000; then,
13from the moneys remaining, if any amounts required to be paid
14into the General Revenue Fund in previous months remain unpaid,
15those amounts shall be paid into the General Revenue Fund; then
16from the moneys remaining, $5,000,000 per month shall be paid
17into the School Infrastructure Fund; then, if any amounts
18required to be paid into the School Infrastructure Fund in
19previous months remain unpaid, those amounts shall be paid into
20the School Infrastructure Fund; then the moneys remaining, if
21any, shall be paid into the Long-Term Care Provider Fund.
22    When any tax imposed herein terminates or has terminated,
23distributors who have bought stamps while such tax was in
24effect and who therefore paid such tax, but who can show, to
25the Department's satisfaction, that they sold the cigarettes to
26which they affixed such stamps after such tax had terminated

 

 

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1and did not recover the tax or its equivalent from purchasers,
2shall be allowed by the Department to take credit for such
3absorbed tax against subsequent tax stamp purchases from the
4Department by such distributor.
5    The impact of the tax levied by this Act is imposed upon
6the retailer and shall be prepaid or pre-collected by the
7distributor for the purpose of convenience and facility only,
8and the amount of the tax shall be added to the price of the
9cigarettes sold by such distributor. Collection of the tax
10shall be evidenced by a stamp or stamps affixed to each
11original package of cigarettes, as hereinafter provided.
12    Each distributor shall collect the tax from the retailer at
13or before the time of the sale, shall affix the stamps as
14hereinafter required, and shall remit the tax collected from
15retailers to the Department, as hereinafter provided. Any
16distributor who fails to properly collect and pay the tax
17imposed by this Act shall be liable for the tax. Any
18distributor having cigarettes to which stamps have been affixed
19in his possession for sale on the effective date of this
20amendatory Act of 1989 shall not be required to pay the
21additional tax imposed by this amendatory Act of 1989 on such
22stamped cigarettes. Any distributor having cigarettes to which
23stamps have been affixed in his or her possession for sale at
2412:01 a.m. on the effective date of this amendatory Act of
251993, is required to pay the additional tax imposed by this
26amendatory Act of 1993 on such stamped cigarettes. This

 

 

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1payment, less the discount provided in subsection (b), shall be
2due when the distributor first makes a purchase of cigarette
3tax stamps after the effective date of this amendatory Act of
41993, or on the first due date of a return under this Act after
5the effective date of this amendatory Act of 1993, whichever
6occurs first. Any distributor having cigarettes to which stamps
7have been affixed in his possession for sale on December 15,
81997 shall not be required to pay the additional tax imposed by
9this amendatory Act of 1997 on such stamped cigarettes.
10    Any distributor having cigarettes to which stamps have been
11affixed in his or her possession for sale on July 1, 2002 shall
12not be required to pay the additional tax imposed by this
13amendatory Act of the 92nd General Assembly on those stamped
14cigarettes.
15    Distributors making sales of cigarettes to secondary
16distributors shall add the amount of the tax to the price of
17the cigarettes sold by the distributors. Secondary
18distributors making sales of cigarettes to retailers shall
19include the amount of the tax in the price of the cigarettes
20sold to retailers. The amount of tax shall not be less than the
21amount of taxes imposed by the State and all local
22jurisdictions. The amount of local taxes shall be calculated
23based on the location of the retailer's place of business shown
24on the retailer's certificate of registration or
25sub-registration issued to the retailer pursuant to Section 2a
26of the Retailers' Occupation Tax Act. The original packages of

 

 

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1cigarettes sold to the retailer shall bear all the required
2stamps, or other indicia, for the taxes included in the price
3of cigarettes.
4    The amount of the Cigarette Tax imposed by this Act shall
5be separately stated, apart from the price of the goods, by
6distributors, manufacturer representatives, secondary
7distributors, and retailers, in all bills and sales invoices.
8    (b) The distributor shall be required to collect the taxes
9provided under paragraph (a) hereof, and, to cover the costs of
10such collection, shall be allowed a discount during any year
11commencing July 1st and ending the following June 30th in
12accordance with the schedule set out hereinbelow, which
13discount shall be allowed at the time of purchase of the stamps
14when purchase is required by this Act, or at the time when the
15tax is remitted to the Department without the purchase of
16stamps from the Department when that method of paying the tax
17is required or authorized by this Act. Prior to December 1,
181985, a discount equal to 1 2/3% of the amount of the tax up to
19and including the first $700,000 paid hereunder by such
20distributor to the Department during any such year; 1 1/3% of
21the next $700,000 of tax or any part thereof, paid hereunder by
22such distributor to the Department during any such year; 1% of
23the next $700,000 of tax, or any part thereof, paid hereunder
24by such distributor to the Department during any such year, and
252/3 of 1% of the amount of any additional tax paid hereunder by
26such distributor to the Department during any such year shall

 

 

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1apply. On and after December 1, 1985, a discount equal to 1.75%
2of the amount of the tax payable under this Act up to and
3including the first $3,000,000 paid hereunder by such
4distributor to the Department during any such year and 1.5% of
5the amount of any additional tax paid hereunder by such
6distributor to the Department during any such year shall apply.
7    Two or more distributors that use a common means of
8affixing revenue tax stamps or that are owned or controlled by
9the same interests shall be treated as a single distributor for
10the purpose of computing the discount.
11    (c) The taxes herein imposed are in addition to all other
12occupation or privilege taxes imposed by the State of Illinois,
13or by any political subdivision thereof, or by any municipal
14corporation.
15(Source: P.A. 96-1027, eff. 7-12-10.)
 
16    (35 ILCS 130/4d)
17    Sec. 4d. Sales of cigarettes to and by retailers. In-state
18makers, manufacturers, and fabricators licensed as
19distributors under Section 4 of this Act and out-of-state
20makers, manufacturers, and fabricators holding permits under
21Section 4b of this Act may not sell original packages of
22cigarettes to retailers. A retailer may sell only original
23packages of cigarettes obtained from manufacturer
24representatives, licensed secondary distributors, or licensed
25distributors other than in-state makers, manufacturers, or

 

 

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1fabricators licensed as distributors under Section 4 of this
2Act and out-of-state makers, manufacturers, or fabricators
3holding permits under Section 4b of this Act.
4(Source: P.A. 95-1053, eff. 1-1-10; 96-782, eff. 1-1-10;
596-1027, eff. 7-12-10.)
 
6    (35 ILCS 130/4f new)
7    Sec. 4f. Manufacturer representatives.
8    (a) No manufacturer may market cigarettes produced by the
9manufacturer directly to retailers in this State without first
10having obtained authorization from the Department. Application
11for authority to maintain representatives in this State to
12market in this State cigarettes produced by the manufacturer
13shall be made to the Department on a form furnished and
14prescribed by the Department. Each applicant under this Section
15shall furnish the following information to the Department on a
16form signed and verified by the applicant under penalty of
17perjury:
18        (1) the name and address of the applicant;
19        (2) the address of every location from which the
20    applicant proposes to engage in business in this State;
21        (3) the number of manufacturer representatives the
22    applicant requests to maintain in this State; and
23        (4) any other additional information as the Department
24    may reasonably require.
25    The following manufacturers are ineligible to receive

 

 

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1authorization to maintain manufacturer representatives in this
2State:
3        (1) a manufacturer who owes, at the time of
4    application, any delinquent cigarette taxes that have been
5    determined by law to be due and unpaid, unless the
6    applicant has entered into an agreement approved by the
7    Department to pay the amount due;
8        (2) a manufacturer who has had a license revoked within
9    the past 2 years for misconduct relating to stolen or
10    contraband cigarettes or has been convicted of a state or
11    federal crime, punishable by imprisonment of one year or
12    more, relating to stolen or contraband cigarettes;
13        (3) a manufacturer who has been found, after notice and
14    a hearing, to have imported or caused to be imported into
15    the United States for sale or distribution any cigarette in
16    violation of 19 U.S.C. 1681a;
17        (4) a manufacturer who has been found, after notice and
18    a hearing, to have imported or caused to be imported into
19    the United States for sale or distribution or manufactured
20    for sale or distribution in the United States any cigarette
21    that does not fully comply with the Federal Cigarette
22    Labeling and Advertising Act (15 U.S.C. 1331, et seq.);
23        (5) a manufacturer who has been found, after notice and
24    a hearing, to have made a material false statement in an
25    application or has failed to produce records required to be
26    maintained by this Act;

 

 

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1        (6) a manufacturer who has been found, after notice and
2    hearing, to have violated any Section of this Act; or
3        (7) a manufacturer licensed as a distributor under
4    Section 4 of this Act or holding a permit under Section 4b
5    of this Act.
6    The Department, upon receipt of an application from a
7manufacturer who is eligible to maintain manufacturer
8representatives in this State, shall notify the applicant in
9writing, not more than 60 days after an application has been
10received, that the applicant may or may not maintain the
11requested number of manufacturer representatives in this
12State. A copy of the notice authorizing a manufacturer to
13maintain manufacturer representatives in this State shall be
14available for inspection by the Department at each place of
15business identified in the application and in the motor vehicle
16operated by marketing representatives in the course of
17performing his or her duties in this State on behalf of the
18manufacturer.
19    A manufacturer representative shall notify the Department
20of any change in the information contained on the application
21form and shall do so within 30 days after any such change.
22    (b) Only directors, officers, and employees of the
23manufacturer may act as manufacturer representatives in this
24State. The manufacturer shall provide to the Department the
25names and addresses of the manufacturer representatives
26operating in this State and the make, model, and license plate

 

 

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1number of each motor vehicle operated by a manufacturer
2representative in the course of performing his or her duties in
3this State on behalf of the manufacturer. The following
4individuals may not act as manufacturer representatives:
5        (1) an individual who owes any delinquent cigarette
6    taxes that have been determined by law to be due and
7    unpaid, unless the individual has entered into an agreement
8    approved by the Department to pay the amount due;
9        (2) an individual who has had a license revoked within
10    the past 2 years for misconduct relating to stolen or
11    contraband cigarettes or has been convicted of a state or
12    federal crime, punishable by imprisonment of one year or
13    more, relating to stolen or contraband cigarettes;
14        (3) an individual who has been found, after notice and
15    a hearing, to have made a material false statement in an
16    application or has failed to produce records required to be
17    maintained by this Act; or
18        (4) an individual who has been found, after notice and
19    hearing, to have violated any Section of this Act.
20    (c) Manufacturer representatives may sell to retailers in
21this State only original packages of cigarettes made,
22manufactured, or fabricated by the manufacturer and purchased
23or obtained from a distributor licensed under this Act, or the
24Cigarette Tax Use Act, and on which tax stamps have been
25affixed. Manufacturer representatives may sell up to 600
26stamped original packages of cigarettes in a calendar year, for

 

 

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1the purpose of promoting the manufacturer's brands of
2cigarettes. A manufacturer representative may not possess more
3than 500 stamped original packages of cigarettes made,
4manufactured, or fabricated by the manufacturer and purchased
5or obtained from a distributor licensed under this Act or the
6Cigarette Use Tax Act. Any original packages of cigarettes in
7the possession of a manufacturer representative that (i) are
8not made, manufactured, or fabricated by the manufacturer and
9purchased or obtained from a distributor licensed under this
10Act or the Cigarette Use Tax Act, other than cigarettes for
11personal use and consumption, (ii) exceed the maximum quantity
12of 500 original packages of cigarettes, excluding packages of
13cigarettes for personal use and consumption; (iii) violate
14Section 3-10 of this Act; or (iv) do not have the proper tax
15stamps affixed, are contraband and subject to seizure and
16forfeiture.
17    Manufacturer representatives may sell stamped original
18packages of cigarettes to retailers on behalf of licensed
19distributors. The manufacturer representative shall provide
20the distributor with a signed receipt for the cigarettes
21obtained from the distributor. The distributor shall invoice
22the retailer, and the retailer shall pay the distributor for
23all cigarettes provided to retailers by manufacturer
24representatives on behalf of a distributor.
25    Manufacturer representatives may sell stamped original
26packages of cigarettes to retailers that are purchased from

 

 

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1licensed distributors. Distributors shall provide manufacturer
2representatives with invoices for stamped original packages of
3cigarettes sold to manufacturer representatives. Manufacturer
4representatives shall invoice retailers, and the retailers
5shall pay the manufacturer representatives for all original
6packages of cigarettes sold to retailers.
7    (d) Any person aggrieved by any decision of the Department
8under this Section may, within 20 days after notice of the
9decision, protest and request a hearing. Upon receiving a
10request for a hearing, the Department shall give notice to the
11person requesting the hearing of the time and place fixed for
12the hearing and shall hold a hearing in conformity with the
13provisions of this Act and then issue its final administrative
14decision in the matter to that person. In the absence of a
15protest and request for a hearing within 20 days, the
16Department's decision shall become final without any further
17determination being made or notice given.
 
18    (35 ILCS 130/7)  (from Ch. 120, par. 453.7)
19    Sec. 7. The Department or any officer or employee of the
20Department designated, in writing, by the Director thereof,
21shall at its or his or her own instance, or on the written
22request of any distributor, secondary distributor,
23manufacturer with authority to maintain manufacturer
24representatives, or other interested party to the proceeding,
25issue subpoenas requiring the attendance of and the giving of

 

 

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1testimony by witnesses, and subpoenas duces tecum requiring the
2production of books, papers, records or memoranda. All
3subpoenas and subpoenas duces tecum issued under the terms of
4this Act may be served by any person of full age. The fees of
5witnesses for attendance and travel shall be the same as the
6fees of witnesses before the circuit court of this State; such
7fees to be paid when the witness is excused from further
8attendance. When the witness is subpoenaed at the instance of
9the Department or any officer or employee thereof, such fees
10shall be paid in the same manner as other expenses of the
11Department, and when the witness is subpoenaed at the instance
12of any other party to any such proceeding, the cost of service
13of the subpoena or subpoena duces tecum and the fee of the
14witness shall be borne by the party at whose instance the
15witness is summoned. In such case the Department, in its
16discretion, may require a deposit to cover the cost of such
17service and witness fees. A subpoena or subpoena duces tecum so
18issued shall be served in the same manner as a subpoena or
19subpoena duces tecum issued out of a court.
20    Any circuit court of this State, upon the application of
21the Department or any officer or employee thereof, or upon the
22application of any other party to the proceeding, may, in its
23discretion, compel the attendance of witnesses, the production
24of books, papers, records or memoranda and the giving of
25testimony before the Department or any officer or employee
26thereof conducting an investigation or holding a hearing

 

 

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1authorized by this Act, by an attachment for contempt, or
2otherwise, in the same manner as production of evidence may be
3compelled before the court.
4    The Department or any officer or employee thereof, or any
5other party in an investigation or hearing before the
6Department, may cause the depositions of witnesses within the
7State to be taken in the manner prescribed by law for like
8depositions, or depositions for discovery in civil actions in
9courts of this State, and to that end compel the attendance of
10witnesses and the production of books, papers, records or
11memoranda, in the same manner hereinbefore provided.
12(Source: P.A. 96-1027, eff. 7-12-10.)
 
13    (35 ILCS 130/8)  (from Ch. 120, par. 453.8)
14    Sec. 8. The Department may make, promulgate and enforce
15such reasonable rules and regulations relating to the
16administration and enforcement of this Act as may be deemed
17expedient.
18    Whenever notice is required by this Act, such notice may be
19given by United States certified or registered mail, addressed
20to the person concerned at his last known address, and proof of
21such mailing shall be sufficient for the purposes of this Act.
22Notice of any hearing provided for by this Act shall be so
23given not less than 7 days prior to the day fixed for the
24hearing.
25    Hearings provided for in this Act shall be held:

 

 

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1        (1) In Cook County, if the taxpayer's or licensee's
2    principal place of business is in that county;
3        (2) At the Department's office nearest the taxpayer's
4    or licensee's principal place of business, if the
5    taxpayer's or licensee's principal place of business is in
6    Illinois but outside Cook County;
7        (3) In Sangamon County, if the taxpayer's or licensee's
8    principal place of business is outside Illinois.
9    The Circuit Court of the County wherein the hearing is held
10has power to review all final administrative decisions of the
11Department in administering this Act. The provisions of the
12Administrative Review Law, and all amendments and
13modifications thereof, and the rules adopted pursuant thereto,
14shall apply to and govern all proceedings for the judicial
15review of final administrative decisions of the Department
16under this Act. The term "administrative decision" is defined
17as in Section 3-101 of the Code of Civil Procedure.
18    Service upon the Director of Revenue or Assistant Director
19of Revenue of summons issued in any action to review a final
20administrative decision shall be service upon the Department.
21The Department shall certify the record of its proceedings if
22the distributor, or secondary distributor, or manufacturer
23with authority to maintain manufacturer representatives pays
24to it the sum of 75¢ per page of testimony taken before the
25Department and 25¢ per page of all other matters contained in
26such record, except that these charges may be waived where the

 

 

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1Department is satisfied that the aggrieved party is a poor
2person who cannot afford to pay such charges. Before the
3delivery of such record to the person applying for it, payment
4of these charges must be made, and if the record is not paid
5for within 30 days after notice that such record is available,
6the complaint may be dismissed by the court upon motion of the
7Department.
8    No stay order shall be entered by the Circuit Court unless
9the distributor, or secondary distributor, or manufacturer
10with authority to maintain manufacturer representatives files
11with the court a bond in an amount fixed and approved by the
12court, to indemnify the State against all loss and injury which
13may be sustained by it on account of the review proceedings and
14to secure all costs which may be occasioned by such
15proceedings.
16    Whenever any proceeding provided by this Act is begun
17before the Department, either by the Department or by a person
18subject to this Act, and such person thereafter dies or becomes
19a person under legal disability before such proceeding is
20concluded, the legal representative of the deceased person or
21of the person under legal disability shall notify the
22Department of such death or legal disability. Such legal
23representative, as such, shall then be substituted by the
24Department for such person. If the legal representative fails
25to notify the Department of his or her appointment as such
26legal representative, the Department may, upon its own motion,

 

 

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1substitute such legal representative in the proceeding pending
2before the Department for the person who died or became a
3person under legal disability.
4(Source: P.A. 96-1027, eff. 7-12-10.)
 
5    (35 ILCS 130/9)  (from Ch. 120, par. 453.9)
6    Sec. 9. Returns; remittance. Every distributor who is
7required to procure a license under this Act, but who is not a
8manufacturer of cigarettes in original packages which are
9contained in a sealed transparent wrapper, shall, on or before
10the 15th day of each calendar month, file a return with the
11Department, showing the quantity of cigarettes manufactured
12during the preceding calendar month, the quantity of cigarettes
13brought into this State or caused to be brought into this State
14from outside this State during the preceding calendar month
15without authorized evidence on the original packages of such
16cigarettes underneath the sealed transparent wrapper thereof
17that the tax liability imposed by this Act has been assumed by
18the out-of-State seller of such cigarettes, the quantity of
19cigarettes purchased tax-paid during the preceding calendar
20month either within or outside this State, the quantity of
21cigarettes sold by manufacturer representatives on behalf of
22the distributor, the quantity of cigarettes sold to
23manufacturer representatives, and the quantity of cigarettes
24sold or otherwise disposed of during the preceding calendar
25month. Such return shall be filed upon forms furnished and

 

 

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1prescribed by the Department and shall contain such other
2information as the Department may reasonably require. The
3Department may promulgate rules to require that the
4distributor's return be accompanied by appropriate
5computer-generated magnetic media supporting schedule data in
6the format required by the Department, unless, as provided by
7rule, the Department grants an exception upon petition of a
8distributor.
9    Illinois manufacturers of cigarettes in original packages
10which are contained inside a sealed transparent wrapper shall
11file a return by the 5th day of each month covering the
12preceding calendar month. Each such return shall be accompanied
13by the appropriate remittance for tax as provided in the last
14paragraph of Section 3 of this Act. Each such return shall show
15the quantity of such cigarettes manufactured during the period
16covered by the return, the quantity of cigarettes sold or
17otherwise disposed of during the period covered by the return
18and such other information as the Department may lawfully
19require. Such returns shall be filed on forms prescribed and
20furnished by the Department. Each such return shall be
21accompanied by a copy of each invoice rendered by such
22manufacturer to any purchaser to whom such manufacturer
23delivered cigarettes (or caused cigarettes to be delivered)
24during the period covered by the return. The Department may
25promulgate rules to require that the manufacturer's return be
26accompanied by appropriate computer-generated magnetic media

 

 

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1supporting schedule data in the format required by the
2Department, unless, as provided by rule, the Department grants
3an exception upon petition of a manufacturer.
4(Source: P.A. 92-322, eff. 1-1-02.)
 
5    (35 ILCS 130/9f new)
6    Sec. 9f. Manufacturer representatives; reports. Every
7manufacturer with authority to maintain manufacturer
8representatives as defined by Section 4f of this Act shall, on
9or before the 15th day of each calendar month, file a report
10with the Department, showing the quantity of cigarettes
11purchased from licensed distributors during the preceding
12calendar month, either within or outside this State, and the
13quantity of cigarettes sold to retailers or otherwise disposed
14of during the preceding calendar month. Such reports shall be
15filed in the form prescribed by the Department and shall
16contain such other information as the Department may reasonably
17require. The report shall be filed electronically and be
18accompanied by appropriate computer generated magnetic media
19supporting schedule data in the format required by the
20Department, unless, as provided by rule, the Department grants
21an exception upon petition of a manufacturer with authority to
22maintain manufacturer representatives in this State.
23    A certification by the Director of the Department that a
24report has not been filed, or that information has not been
25supplied pursuant to the provisions of this Act, shall be prima

 

 

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1facie evidence thereof.
 
2    (35 ILCS 130/10)  (from Ch. 120, par. 453.10)
3    Sec. 10. The Department, or any officer or employee
4designated in writing by the Director thereof, for the purpose
5of administering and enforcing the provisions of this Act, may
6hold investigations and hearings concerning any matters
7covered by this Act, and may examine books, papers, records or
8memoranda bearing upon the sale or other disposition of
9cigarettes by a distributor, or secondary distributor,
10manufacturer with authority to maintain manufacturer
11representatives under Section 4f of this Act, or manufacturer
12representative, and may issue subpoenas requiring the
13attendance of a distributor, or secondary distributor,
14manufacturer with authority to maintain manufacturer
15representatives under Section 4f of this Act, or manufacturer
16representative, or any officer or employee of a distributor, or
17secondary distributor, manufacturer with authority to maintain
18manufacturer representatives under Section 4f of this Act, or
19any person having knowledge of the facts, and may take
20testimony and require proof, and may issue subpoenas duces
21tecum to compel the production of relevant books, papers,
22records and memoranda, for the information of the Department.
23    In the conduct of any investigation or hearing provided for
24by this Act, neither the Department, nor any officer or
25employee thereof, shall be bound by the technical rules of

 

 

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1evidence, and no informality in the proceedings nor in the
2manner of taking testimony shall invalidate any rule, order,
3decision or regulation made, approved or confirmed by the
4Department.
5    The Director of Revenue, or any duly authorized officer or
6employee of the Department, shall have the power to administer
7oaths to such persons required by this Act to give testimony
8before the said Department.
9    The books, papers, records and memoranda of the Department,
10or parts thereof, may be proved in any hearing, investigation
11or legal proceeding by a reproduced copy thereof under the
12certificate of the Director of Revenue. Such reproduced copy
13shall, without further proof, be admitted into evidence before
14the Department or in any legal proceeding.
15(Source: P.A. 96-1027, eff. 7-12-10.)
 
16    (35 ILCS 130/11b new)
17    Sec. 11b. Manufacturer representatives; records. Every
18manufacturer with authority to maintain manufacturer
19representatives under Section 4f of this Act shall keep within
20Illinois, at his business address identified under section 4f
21of this Act, complete and accurate records of cigarettes
22purchased, sold, or otherwise disposed of, and shall preserve
23and keep within Illinois at his business address all invoices,
24sales records, copies of bills of sale, inventory at the close
25of each period for which a report is required of all cigarettes

 

 

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1on hand, and other pertinent papers and documents relating to
2the purchase, sale, or disposition of cigarettes. All books and
3records and other papers and documents that are required by
4this Act to be kept shall be kept in the English language, and
5shall, at all times during the usual business hours of the day,
6be subject to inspection by the Department or its duly
7authorized agents and employees. The Department may adopt rules
8that establish requirements, including record forms and
9formats, for records required to be kept and maintained by
10manufacturers with authority to maintain manufacturer
11representatives under Section 4f of this Act and their
12manufacturer representatives. For purposes of this Section,
13"records" means all data maintained by the manufacturers with
14authority to maintain manufacturer representatives under
15Section 4f of this Act and their manufacturer representatives,
16including data on paper, microfilm, microfiche or any type of
17machine sensible data compilation. Those books, records,
18papers, and documents shall be preserved for a period of at
19least 3 years after the date of the documents, or the date of
20the entries appearing in the records, unless the Department, in
21writing, authorizes their destruction or disposal at an earlier
22date. At all times during the usual business hours of the day
23any duly authorized agent or employee of the Department may
24enter any place of business of the manufacturers with authority
25to maintain manufacturer representatives under Section 4f of
26this Act and their manufacturer representatives, or inspect any

 

 

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1motor vehicle used by a manufacturer representative in the
2course of business, without a search warrant and may inspect
3the premises, motor vehicle, and any packages of cigarettes
4therein contained to determine whether any of the provisions of
5this Act are being violated. If such agent or employee is
6denied free access or is hindered or interfered with in making
7such examination as herein provided, the ability to maintain
8marketing representatives in Illinois may be withdrawn by the
9Department.
 
10    (35 ILCS 130/23)  (from Ch. 120, par. 453.23)
11    Sec. 23. Every distributor, secondary distributor,
12manufacturer with authority to maintain manufacturer
13representatives under Section 4f of this Act and their
14manufacturer representatives, or other person who shall
15knowingly and wilfully sell or offer for sale any original
16package, as defined in this Act, having affixed thereto any
17fraudulent, spurious, imitation or counterfeit stamp, or stamp
18which has been previously affixed, or affixes a stamp which has
19previously been affixed to an original package, or who shall
20knowingly and wilfully sell or offer for sale any original
21package, as defined in this Act, having imprinted thereon
22underneath the sealed transparent wrapper thereof any
23fraudulent, spurious, imitation or counterfeit tax imprint,
24shall be deemed guilty of a Class 2 felony.
25(Source: P.A. 96-1027, eff. 7-12-10.)
 

 

 

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1    Section 99. Effective date. This Act takes effect upon
2becoming law.".