97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB3717

 

Introduced 2/10/2012, by Sen. Don Harmon

 

SYNOPSIS AS INTRODUCED:
 
50 ILCS 753/15
50 ILCS 753/20
30 ILCS 105/5.811 new

    Amends the Prepaid Wireless 9-1-1 Surcharge Act. Provides that the Department of Revenue shall pay to the State Treasurer all prepaid wireless E911 charges and penalties collected for deposit into the Wireless Service Emergency Fund, other than amounts to be paid to the Municipal Wireless Service Emergency Fund. Sets forth reporting and distribution requirements concerning the amounts collected. Provides that the Department may deduct a specified amount of remitted charges to be transferred into the Tax Compliance and Administration Fund (now, to be retained by the Department) to reimburse the Department for its direct costs of administering the collection and remittance of prepaid wireless 9-1-1 surcharges. Provides that if a home rule municipality having a population in excess of 500,000 as of the effective date of this amendatory Act imposes an E911 surcharge, then the Treasurer shall deposit any amounts collected into the Municipal Wireless Service Emergency Fund. Sets forth reporting and distribution requirements concerning the amounts collected. Further provides that overpayments received by the Department for liabilities reported on existing or combined returns shall be first applied to retailers' occupation tax, use tax, service occupation tax, or service use tax liabilities. Amends the State Finance Act. Creates the Municipal Wireless Service Emergency Fund.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Prepaid Wireless 9-1-1 Surcharge Act is
5amended by changing Sections 15 and 20 as follows:
 
6    (50 ILCS 753/15)
7    Sec. 15. Prepaid wireless 9-1-1 surcharge.
8    (a) There is hereby imposed on consumers a prepaid wireless
99-1-1 surcharge of 1.5% per retail transaction. The surcharge
10authorized by this subsection (a) does not apply in a home rule
11municipality having a population in excess of 500,000. The
12amount of the surcharge may be reduced or increased pursuant to
13subsection (e).
14    (a-5) A home rule municipality having a population in
15excess of 500,000 on the effective date of this Act may only
16impose a prepaid wireless 9-1-1 surcharge not to exceed 7% per
17retail transaction sourced to that jurisdiction and collected
18and remitted in accordance with the provisions of subsection
19(b-5).
20    (b) The prepaid wireless 9-1-1 surcharge shall be collected
21by the seller from the consumer with respect to each retail
22transaction occurring in this State and shall be remitted to
23the Department by the seller as provided in this Act. The

 

 

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1amount of the prepaid wireless 9-1-1 surcharge shall be
2separately stated as a distinct item apart from the charge for
3the prepaid wireless telecommunications service on an invoice,
4receipt, or other similar document that is provided to the
5consumer by the seller or shall be otherwise disclosed to the
6consumer. If the seller does not separately state the surcharge
7as a distinct item to the consumer as provided in this Section,
8then the seller shall maintain books and records as required by
9this Act which clearly identify the amount of the 9-1-1
10surcharge for retail transactions.
11    For purposes of this subsection (b), a retail transaction
12occurs in this State if (i) the retail transaction is made in
13person by a consumer at the seller's business location and the
14business is located within the State; (ii) the seller is a
15provider and sells prepaid wireless telecommunications service
16to a consumer located in Illinois; (iii) the retail transaction
17is treated as occurring in this State for purposes of the
18Retailers' Occupation Tax Act; or (iv) a seller that is
19included within the definition of a "retailer maintaining a
20place of business in this State" under Section 2 of the Use Tax
21Act makes a sale of prepaid wireless telecommunications service
22to a consumer located in Illinois. In the case of a retail
23transaction which does not occur in person at a seller's
24business location, if a consumer uses a credit card to purchase
25prepaid wireless telecommunications service on-line or over
26the telephone, and no product is shipped to the consumer, the

 

 

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1transaction occurs in this State if the billing address for the
2consumer's credit card is in this State.
3    (b-5) The prepaid wireless 9-1-1 surcharge imposed under
4subsection (a-5) of this Section shall be collected by the
5seller from the consumer with respect to each retail
6transaction occurring in the municipality imposing the
7surcharge. The amount of the prepaid wireless 9-1-1 surcharge
8shall be separately stated on an invoice, receipt, or other
9similar document that is provided to the consumer by the seller
10or shall be otherwise disclosed to the consumer. If the seller
11does not separately state the surcharge as a distinct item to
12the consumer as provided in this Section, then the seller shall
13maintain books and records as required by this Act which
14clearly identify the amount of the 9-1-1 surcharge for retail
15transactions.
16    For purposes of this subsection (b-5), a retail transaction
17occurs in the municipality if (i) the retail transaction is
18made in person by a consumer at the seller's business location
19and the business is located within the municipality; (ii) the
20seller is a provider and sells prepaid wireless
21telecommunications service to a consumer located in the
22municipality; (iii) the retail transaction is treated as
23occurring in the municipality for purposes of the Retailers'
24Occupation Tax Act; or (iv) a seller that is included within
25the definition of a "retailer maintaining a place of business
26in this State" under Section 2 of the Use Tax Act makes a sale

 

 

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1of prepaid wireless telecommunications service to a consumer
2located in the municipality. In the case of a retail
3transaction which does not occur in person at a seller's
4business location, if a consumer uses a credit card to purchase
5prepaid wireless telecommunications service on-line or over
6the telephone, and no product is shipped to the consumer, the
7transaction occurs in the municipality if the billing address
8for the consumer's credit card is in the municipality.
9    (c) The prepaid wireless 9-1-1 surcharge is imposed on the
10consumer and not on any provider. The seller shall be liable to
11remit all prepaid wireless 9-1-1 surcharges that the seller
12collects from consumers as provided in Section 20, including
13all such surcharges that the seller is deemed to collect where
14the amount of the surcharge has not been separately stated on
15an invoice, receipt, or other similar document provided to the
16consumer by the seller. The surcharge collected or deemed
17collected by a seller shall constitute a debt owed by the
18seller to this State, and any such surcharge actually collected
19shall be held in trust for the benefit of the Department.
20    For purposes of this subsection (c), the surcharge shall
21not be imposed or collected from entities that have an active
22tax exemption identification number issued by the Department
23are tax exempt under Section 1g of the Retailers' Occupation
24Tax Act.
25    (d) The amount of the prepaid wireless 9-1-1 surcharge that
26is collected by a seller from a consumer, if such amount is

 

 

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1separately stated on an invoice, receipt, or other similar
2document provided to the consumer by the seller, shall not be
3included in the base for measuring any tax, fee, surcharge, or
4other charge that is imposed by this State, any political
5subdivision of this State, or any intergovernmental agency.
6    (e) The prepaid wireless 9-1-1 charge imposed under
7subsection (a) of this Section shall be proportionately
8increased or reduced, as applicable, upon any change to the
9surcharge imposed under Section 17 of the Wireless Emergency
10Telephone Safety Act. The adjusted rate shall be determined by
11dividing the amount of the surcharge imposed under Section 17
12of the Wireless Emergency Telephone Safety Act by $50. Such
13increase or reduction shall be effective on the first day of
14the first calendar month to occur at least 60 days after the
15enactment of the change to the surcharge imposed under Section
1617 of the Wireless Emergency Telephone Safety Act. The
17Department shall provide not less than 30 days' notice of an
18increase or reduction in the amount of the surcharge on the
19Department's website.
20    (e-5) Any changes in the rate of the surcharge imposed by a
21municipality under the authority granted in subsection (a-5) of
22this Section shall be effective on the first day of the first
23calendar month to occur at least 60 days after the enactment of
24the change. The Department shall provide not less than 30 days'
25notice of the increase or reduction in the rate of such
26surcharge on the Department's website.

 

 

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1    (f) When prepaid wireless telecommunications service is
2sold with one or more other products or services for a single,
3non-itemized price, then the percentage specified in
4subsection (a) or (a-5) of this Section 15 shall be applied to
5the entire non-itemized price unless the seller elects to apply
6the percentage to (i) the dollar amount of the prepaid wireless
7telecommunications service if that dollar amount is disclosed
8to the consumer or (ii) the portion of the price that is
9attributable to the prepaid wireless telecommunications
10service if the retailer can identify that portion by reasonable
11and verifiable standards from its books and records that are
12kept in the regular course of business for other purposes,
13including, but not limited to, books and records that are kept
14for non-tax purposes. However, if a minimal amount of prepaid
15wireless telecommunications service is sold with a prepaid
16wireless device for a single, non-itemized price, then the
17seller may elect not to apply the percentage specified in
18subsection (a) or (a-5) of this Section 15 to such transaction.
19For purposes of this subsection, an amount of service
20denominated as 10 minutes or less or $5 or less is considered
21minimal.
22(Source: P.A. 97-463, eff. 1-1-12.)
 
23    (50 ILCS 753/20)
24    Sec. 20. Administration of prepaid wireless 9-1-1
25surcharge.

 

 

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1    (a) In the administration and enforcement of this Act, the
2provisions of Sections 2a, 2b, 2c, 3, 4, 5, 5a, 5b, 5c, 5d, 5e,
35f, 5g, 5i, 5j, 6, 6a, 6b, 6c, 7, 8, 9, 10, 11, and 12 of the
4Retailers' Occupation Tax Act that are not inconsistent with
5this Act, and Section 3-7 of the Uniform Penalty and Interest
6Act shall apply, as far as practicable, to the subject matter
7of this Act to the same extent as if those provisions were
8included in this Act. References to "taxes" in these
9incorporated Sections shall be construed to apply to the
10administration, payment, and remittance of all surcharges
11under this Act. The Department shall establish registration and
12payment procedures that substantially coincide with the
13registration and payment procedures that apply to the
14Retailers' Occupation Tax Act.
15    (b) For the first 12 months after the effective date of
16this Act, a seller shall be permitted to deduct and retain 5%
17of prepaid wireless 9-1-1 surcharges that are collected by the
18seller from consumers and that are remitted and timely filed
19with the Department. After the first 12 months, a seller shall
20be permitted to deduct and retain 3% of prepaid wireless 9-1-1
21surcharges that are collected by the seller from consumers and
22that are remitted and timely filed with the Department.
23    (c) Other than the amounts for deposit into the Municipal
24Wireless Service Emergency Fund, the Department shall pay to
25the State Treasurer all prepaid wireless E911 charges and
26penalties collected under this Act for deposit into the

 

 

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1Wireless Service Emergency Fund. On or before the 25th day of
2each calendar month, the Department shall prepare and certify
3to the Comptroller the amount available to the Illinois
4Commerce Commission for distribution out of the Wireless
5Service Emergency Fund. The amount certified shall be the
6amount (not including credit memoranda) collected during the
7second preceding calendar month by the Department plus an
8amount the Department determines is necessary to offset any
9amounts which were erroneously paid to a different taxing body.
10The amount paid to the Wireless Service Emergency Fund shall
11not include any amount equal to the amount of refunds made
12during the second preceding calendar month by the Department to
13retailers under this Act or any amount that the Department
14determines is necessary to offset any amounts which were
15payable to a different taxing body but were erroneously paid to
16the Wireless Service Emergency Fund. The Illinois Commerce
17Commission shall distribute the funds in the same proportion as
18they are distributed under the Wireless Emergency Telephone
19Safety Act and the funds may only be used in accordance with
20the provisions of the Wireless Emergency Telephone Safety Act.
21The Department shall pay all remitted prepaid wireless E911
22charges over to the State Treasurer for deposit into the
23Wireless Service Emergency Fund within 30 days after receipt.
24The Illinois Commerce Commission shall distribute such funds in
25the same proportion as they are distributed under the Wireless
26Emergency Telephone Safety Act and such funds may only be used

 

 

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1in accordance with the provisions of the Wireless Emergency
2Telephone Safety Act. The Department may deduct an amount, not
3to exceed 3% during the first year following the effective date
4of this Act and not to exceed 2% during every year thereafter
5of remitted charges, to be transferred into retained by the Tax
6Compliance and Administration Fund Department to reimburse the
7Department for its direct costs of administering the collection
8and remittance of prepaid wireless 9-1-1 surcharges.
9    (d) The Department shall administer the collection of all
109-1-1 surcharges and may adopt and enforce reasonable rules
11relating to the administration and enforcement of the
12provisions of this Act as may be deemed expedient. The
13Department shall require all surcharges collected under this
14Act to be reported on existing forms or combined forms,
15including, but not limited to, Form ST-1. Any overpayments
16received by the Department for liabilities reported on existing
17or combined returns shall be applied as an overpayment of
18retailers' occupation tax, use tax, service occupation tax, or
19service use tax liability.
20    (e) If a home rule municipality having a population in
21excess of 500,000 as of the effective date of this amendatory
22Act of the 97th General Assembly imposes an E911 surcharge
23under subsection (a-5) of Section 15 of this Act, then the
24Department shall pay to the State Treasurer all prepaid
25wireless E911 charges, penalties, and interest collected for
26deposit into the Municipal Wireless Service Emergency Fund. All

 

 

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1deposits into the Municipal Wireless Service Emergency Fund
2shall be held by the State Treasurer as ex officio custodian
3separate and apart from all public moneys or funds of this
4State. Moneys in the Municipal Wireless Service Emergency Fund
5are not subject to appropriation. On or before the 25th day of
6each calendar month, the Department shall prepare and certify
7to the Comptroller the amount available for disbursement to the
8home rule municipality out of the Municipal Wireless Service
9Emergency Fund. The amount to be paid to the Municipal Wireless
10Service Emergency Fund shall be the amount (not including
11credit memoranda) collected during the second preceding
12calendar month by the Department plus an amount the Department
13determines is necessary to offset any amounts which were
14erroneously paid to a different taxing body. The amount paid to
15the Municipal Wireless Service Emergency Fund shall not include
16any amount equal to the amount of refunds made during the
17second preceding calendar month by the Department to retailers
18under this Act or any amount that the Department determines is
19necessary to offset any amounts which were payable to a
20different taxing body but were erroneously paid to the
21Municipal Wireless Service Emergency Fund. Within 10 days after
22receipt by the Comptroller of the certification provided for in
23this subsection, the Comptroller shall cause the orders to be
24drawn for the respective amounts in accordance with the
25directions in the certification. The Department may deduct an
26amount, not to exceed 3% during the first year following the

 

 

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1effective date of this amendatory Act of the 97th General
2Assembly and not to exceed 2% during every year thereafter of
3remitted charges, to be transferred into the Tax Compliance and
4Administration Fund to reimburse the Department for its direct
5costs of administering the collection and remittance of prepaid
6wireless 9-1-1 surcharges.
7(Source: P.A. 97-463, eff. 1-1-12.)
 
8    Section 10. The State Finance Act is amended by adding
9Section 5.811 as follows:
 
10    (30 ILCS 105/5.811 new)
11    Sec. 5.811. The Municipal Wireless Service Emergency Fund.