99TH GENERAL ASSEMBLY
State of Illinois
2015 and 2016
SB2904

 

Introduced 2/18/2016, by Sen. William E. Brady

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-55  from Ch. 120, par. 439.3-55
35 ILCS 110/3-45  from Ch. 120, par. 439.33-45
35 ILCS 115/3-5
35 ILCS 120/2-5

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that the exemption for the use or sale of tangible personal property purchased from an Illinois retailer by a taxpayer engaged in centralized purchasing activities in Illinois who will temporarily store the property in Illinois (i) for the purpose of subsequently transporting it outside this State for use or consumption solely outside this State or (ii) for the purpose of being processed, fabricated, or manufactured into, attached to, or incorporated into other tangible personal property to be transported outside this State and used or consumed solely outside this State sunsets on June 20, 2021 (currently, June 30, 2016). Effective immediately.


LRB099 20659 HLH 45269 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB2904LRB099 20659 HLH 45269 b

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
53-55 as follows:
 
6    (35 ILCS 105/3-55)  (from Ch. 120, par. 439.3-55)
7    Sec. 3-55. Multistate exemption. To prevent actual or
8likely multistate taxation, the tax imposed by this Act does
9not apply to the use of tangible personal property in this
10State under the following circumstances:
11    (a) The use, in this State, of tangible personal property
12acquired outside this State by a nonresident individual and
13brought into this State by the individual for his or her own
14use while temporarily within this State or while passing
15through this State.
16    (b) The use, in this State, of tangible personal property
17by an interstate carrier for hire as rolling stock moving in
18interstate commerce or by lessors under a lease of one year or
19longer executed or in effect at the time of purchase of
20tangible personal property by interstate carriers for-hire for
21use as rolling stock moving in interstate commerce as long as
22so used by the interstate carriers for-hire, and equipment
23operated by a telecommunications provider, licensed as a common

 

 

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1carrier by the Federal Communications Commission, which is
2permanently installed in or affixed to aircraft moving in
3interstate commerce.
4    (c) The use, in this State, by owners, lessors, or shippers
5of tangible personal property that is utilized by interstate
6carriers for hire for use as rolling stock moving in interstate
7commerce as long as so used by the interstate carriers for
8hire, and equipment operated by a telecommunications provider,
9licensed as a common carrier by the Federal Communications
10Commission, which is permanently installed in or affixed to
11aircraft moving in interstate commerce.
12    (d) The use, in this State, of tangible personal property
13that is acquired outside this State and caused to be brought
14into this State by a person who has already paid a tax in
15another State in respect to the sale, purchase, or use of that
16property, to the extent of the amount of the tax properly due
17and paid in the other State.
18    (e) The temporary storage, in this State, of tangible
19personal property that is acquired outside this State and that,
20after being brought into this State and stored here
21temporarily, is used solely outside this State or is physically
22attached to or incorporated into other tangible personal
23property that is used solely outside this State, or is altered
24by converting, fabricating, manufacturing, printing,
25processing, or shaping, and, as altered, is used solely outside
26this State.

 

 

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1    (f) The temporary storage in this State of building
2materials and fixtures that are acquired either in this State
3or outside this State by an Illinois registered combination
4retailer and construction contractor, and that the purchaser
5thereafter uses outside this State by incorporating that
6property into real estate located outside this State.
7    (g) The use or purchase of tangible personal property by a
8common carrier by rail or motor that receives the physical
9possession of the property in Illinois, and that transports the
10property, or shares with another common carrier in the
11transportation of the property, out of Illinois on a standard
12uniform bill of lading showing the seller of the property as
13the shipper or consignor of the property to a destination
14outside Illinois, for use outside Illinois.
15    (h) Except as provided in subsection (h-1), the use, in
16this State, of a motor vehicle that was sold in this State to a
17nonresident, even though the motor vehicle is delivered to the
18nonresident in this State, if the motor vehicle is not to be
19titled in this State, and if a drive-away permit is issued to
20the motor vehicle as provided in Section 3-603 of the Illinois
21Vehicle Code or if the nonresident purchaser has vehicle
22registration plates to transfer to the motor vehicle upon
23returning to his or her home state. The issuance of the
24drive-away permit or having the out-of-state registration
25plates to be transferred shall be prima facie evidence that the
26motor vehicle will not be titled in this State.

 

 

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1    (h-1) The exemption under subsection (h) does not apply if
2the state in which the motor vehicle will be titled does not
3allow a reciprocal exemption for the use in that state of a
4motor vehicle sold and delivered in that state to an Illinois
5resident but titled in Illinois. The tax collected under this
6Act on the sale of a motor vehicle in this State to a resident
7of another state that does not allow a reciprocal exemption
8shall be imposed at a rate equal to the state's rate of tax on
9taxable property in the state in which the purchaser is a
10resident, except that the tax shall not exceed the tax that
11would otherwise be imposed under this Act. At the time of the
12sale, the purchaser shall execute a statement, signed under
13penalty of perjury, of his or her intent to title the vehicle
14in the state in which the purchaser is a resident within 30
15days after the sale and of the fact of the payment to the State
16of Illinois of tax in an amount equivalent to the state's rate
17of tax on taxable property in his or her state of residence and
18shall submit the statement to the appropriate tax collection
19agency in his or her state of residence. In addition, the
20retailer must retain a signed copy of the statement in his or
21her records. Nothing in this subsection shall be construed to
22require the removal of the vehicle from this state following
23the filing of an intent to title the vehicle in the purchaser's
24state of residence if the purchaser titles the vehicle in his
25or her state of residence within 30 days after the date of
26sale. The tax collected under this Act in accordance with this

 

 

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1subsection (h-1) shall be proportionately distributed as if the
2tax were collected at the 6.25% general rate imposed under this
3Act.
4    (h-2) The following exemptions apply with respect to
5certain aircraft:
6        (1) Beginning on July 1, 2007, no tax is imposed under
7    this Act on the purchase of an aircraft, as defined in
8    Section 3 of the Illinois Aeronautics Act, if all of the
9    following conditions are met:
10            (A) the aircraft leaves this State within 15 days
11        after the later of either the issuance of the final
12        billing for the purchase of the aircraft or the
13        authorized approval for return to service, completion
14        of the maintenance record entry, and completion of the
15        test flight and ground test for inspection, as required
16        by 14 C.F.R. 91.407;
17            (B) the aircraft is not based or registered in this
18        State after the purchase of the aircraft; and
19            (C) the purchaser provides the Department with a
20        signed and dated certification, on a form prescribed by
21        the Department, certifying that the requirements of
22        this item (1) are met. The certificate must also
23        include the name and address of the purchaser, the
24        address of the location where the aircraft is to be
25        titled or registered, the address of the primary
26        physical location of the aircraft, and other

 

 

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1        information that the Department may reasonably
2        require.
3        (2) Beginning on July 1, 2007, no tax is imposed under
4    this Act on the use of an aircraft, as defined in Section 3
5    of the Illinois Aeronautics Act, that is temporarily
6    located in this State for the purpose of a prepurchase
7    evaluation if all of the following conditions are met:
8            (A) the aircraft is not based or registered in this
9        State after the prepurchase evaluation; and
10            (B) the purchaser provides the Department with a
11        signed and dated certification, on a form prescribed by
12        the Department, certifying that the requirements of
13        this item (2) are met. The certificate must also
14        include the name and address of the purchaser, the
15        address of the location where the aircraft is to be
16        titled or registered, the address of the primary
17        physical location of the aircraft, and other
18        information that the Department may reasonably
19        require.
20        (3) Beginning on July 1, 2007, no tax is imposed under
21    this Act on the use of an aircraft, as defined in Section 3
22    of the Illinois Aeronautics Act, that is temporarily
23    located in this State for the purpose of a post-sale
24    customization if all of the following conditions are met:
25            (A) the aircraft leaves this State within 15 days
26        after the authorized approval for return to service,

 

 

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1        completion of the maintenance record entry, and
2        completion of the test flight and ground test for
3        inspection, as required by 14 C.F.R. 91.407;
4            (B) the aircraft is not based or registered in this
5        State either before or after the post-sale
6        customization; and
7            (C) the purchaser provides the Department with a
8        signed and dated certification, on a form prescribed by
9        the Department, certifying that the requirements of
10        this item (3) are met. The certificate must also
11        include the name and address of the purchaser, the
12        address of the location where the aircraft is to be
13        titled or registered, the address of the primary
14        physical location of the aircraft, and other
15        information that the Department may reasonably
16        require.
17    If tax becomes due under this subsection (h-2) because of
18the purchaser's use of the aircraft in this State, the
19purchaser shall file a return with the Department and pay the
20tax on the fair market value of the aircraft. This return and
21payment of the tax must be made no later than 30 days after the
22aircraft is used in a taxable manner in this State. The tax is
23based on the fair market value of the aircraft on the date that
24it is first used in a taxable manner in this State.
25    For purposes of this subsection (h-2):
26    "Based in this State" means hangared, stored, or otherwise

 

 

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1used, excluding post-sale customizations as defined in this
2Section, for 10 or more days in each 12-month period
3immediately following the date of the sale of the aircraft.
4    "Post-sale customization" means any improvement,
5maintenance, or repair that is performed on an aircraft
6following a transfer of ownership of the aircraft.
7    "Prepurchase evaluation" means an examination of an
8aircraft to provide a potential purchaser with information
9relevant to the potential purchase.
10    "Registered in this State" means an aircraft registered
11with the Department of Transportation, Aeronautics Division,
12or titled or registered with the Federal Aviation
13Administration to an address located in this State.
14    This subsection (h-2) is exempt from the provisions of
15Section 3-90.
16    (i) Beginning July 1, 1999, the use, in this State, of fuel
17acquired outside this State and brought into this State in the
18fuel supply tanks of locomotives engaged in freight hauling and
19passenger service for interstate commerce. This subsection is
20exempt from the provisions of Section 3-90.
21    (j) Beginning on January 1, 2002 and through June 30, 2021
22June 30, 2016, the use of tangible personal property purchased
23from an Illinois retailer by a taxpayer engaged in centralized
24purchasing activities in Illinois who will, upon receipt of the
25property in Illinois, temporarily store the property in
26Illinois (i) for the purpose of subsequently transporting it

 

 

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1outside this State for use or consumption thereafter solely
2outside this State or (ii) for the purpose of being processed,
3fabricated, or manufactured into, attached to, or incorporated
4into other tangible personal property to be transported outside
5this State and thereafter used or consumed solely outside this
6State. The Director of Revenue shall, pursuant to rules adopted
7in accordance with the Illinois Administrative Procedure Act,
8issue a permit to any taxpayer in good standing with the
9Department who is eligible for the exemption under this
10subsection (j). The permit issued under this subsection (j)
11shall authorize the holder, to the extent and in the manner
12specified in the rules adopted under this Act, to purchase
13tangible personal property from a retailer exempt from the
14taxes imposed by this Act. Taxpayers shall maintain all
15necessary books and records to substantiate the use and
16consumption of all such tangible personal property outside of
17the State of Illinois.
18(Source: P.A. 97-73, eff. 6-30-11.)
 
19    Section 10. The Service Use Tax Act is amended by changing
20Section 3-45 as follows:
 
21    (35 ILCS 110/3-45)  (from Ch. 120, par. 439.33-45)
22    Sec. 3-45. Multistate exemption. To prevent actual or
23likely multistate taxation, the tax imposed by this Act does
24not apply to the use of tangible personal property in this

 

 

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1State under the following circumstances:
2    (a) The use, in this State, of property acquired outside
3this State by a nonresident individual and brought into this
4State by the individual for his or her own use while
5temporarily within this State or while passing through this
6State.
7    (b) The use, in this State, of property that is acquired
8outside this State and that is moved into this State for use as
9rolling stock moving in interstate commerce.
10    (c) The use, in this State, of property that is acquired
11outside this State and caused to be brought into this State by
12a person who has already paid a tax in another state in respect
13to the sale, purchase, or use of that property, to the extent
14of the amount of the tax properly due and paid in the other
15state.
16    (d) The temporary storage, in this State, of property that
17is acquired outside this State and that after being brought
18into this State and stored here temporarily, is used solely
19outside this State or is physically attached to or incorporated
20into other property that is used solely outside this State, or
21is altered by converting, fabricating, manufacturing,
22printing, processing, or shaping, and, as altered, is used
23solely outside this State.
24    (e) Beginning July 1, 1999, the use, in this State, of fuel
25acquired outside this State and brought into this State in the
26fuel supply tanks of locomotives engaged in freight hauling and

 

 

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1passenger service for interstate commerce. This subsection is
2exempt from the provisions of Section 3-75.
3    (f) Beginning on January 1, 2002 and through June 30, 2021
4June 30, 2016, the use of tangible personal property purchased
5from an Illinois retailer by a taxpayer engaged in centralized
6purchasing activities in Illinois who will, upon receipt of the
7property in Illinois, temporarily store the property in
8Illinois (i) for the purpose of subsequently transporting it
9outside this State for use or consumption thereafter solely
10outside this State or (ii) for the purpose of being processed,
11fabricated, or manufactured into, attached to, or incorporated
12into other tangible personal property to be transported outside
13this State and thereafter used or consumed solely outside this
14State. The Director of Revenue shall, pursuant to rules adopted
15in accordance with the Illinois Administrative Procedure Act,
16issue a permit to any taxpayer in good standing with the
17Department who is eligible for the exemption under this
18subsection (f). The permit issued under this subsection (f)
19shall authorize the holder, to the extent and in the manner
20specified in the rules adopted under this Act, to purchase
21tangible personal property from a retailer exempt from the
22taxes imposed by this Act. Taxpayers shall maintain all
23necessary books and records to substantiate the use and
24consumption of all such tangible personal property outside of
25the State of Illinois.
26(Source: P.A. 97-73, eff. 6-30-11.)
 

 

 

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1    Section 15. The Service Occupation Tax Act is amended by
2changing Section 3-5 as follows:
 
3    (35 ILCS 115/3-5)
4    Sec. 3-5. Exemptions. The following tangible personal
5property is exempt from the tax imposed by this Act:
6    (1) Personal property sold by a corporation, society,
7association, foundation, institution, or organization, other
8than a limited liability company, that is organized and
9operated as a not-for-profit service enterprise for the benefit
10of persons 65 years of age or older if the personal property
11was not purchased by the enterprise for the purpose of resale
12by the enterprise.
13    (2) Personal property purchased by a not-for-profit
14Illinois county fair association for use in conducting,
15operating, or promoting the county fair.
16    (3) Personal property purchased by any not-for-profit arts
17or cultural organization that establishes, by proof required by
18the Department by rule, that it has received an exemption under
19Section 501(c)(3) of the Internal Revenue Code and that is
20organized and operated primarily for the presentation or
21support of arts or cultural programming, activities, or
22services. These organizations include, but are not limited to,
23music and dramatic arts organizations such as symphony
24orchestras and theatrical groups, arts and cultural service

 

 

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1organizations, local arts councils, visual arts organizations,
2and media arts organizations. On and after the effective date
3of this amendatory Act of the 92nd General Assembly, however,
4an entity otherwise eligible for this exemption shall not make
5tax-free purchases unless it has an active identification
6number issued by the Department.
7    (4) Legal tender, currency, medallions, or gold or silver
8coinage issued by the State of Illinois, the government of the
9United States of America, or the government of any foreign
10country, and bullion.
11    (5) Until July 1, 2003 and beginning again on September 1,
122004 through August 30, 2014, graphic arts machinery and
13equipment, including repair and replacement parts, both new and
14used, and including that manufactured on special order or
15purchased for lease, certified by the purchaser to be used
16primarily for graphic arts production. Equipment includes
17chemicals or chemicals acting as catalysts but only if the
18chemicals or chemicals acting as catalysts effect a direct and
19immediate change upon a graphic arts product.
20    (6) Personal property sold by a teacher-sponsored student
21organization affiliated with an elementary or secondary school
22located in Illinois.
23    (7) Farm machinery and equipment, both new and used,
24including that manufactured on special order, certified by the
25purchaser to be used primarily for production agriculture or
26State or federal agricultural programs, including individual

 

 

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1replacement parts for the machinery and equipment, including
2machinery and equipment purchased for lease, and including
3implements of husbandry defined in Section 1-130 of the
4Illinois Vehicle Code, farm machinery and agricultural
5chemical and fertilizer spreaders, and nurse wagons required to
6be registered under Section 3-809 of the Illinois Vehicle Code,
7but excluding other motor vehicles required to be registered
8under the Illinois Vehicle Code. Horticultural polyhouses or
9hoop houses used for propagating, growing, or overwintering
10plants shall be considered farm machinery and equipment under
11this item (7). Agricultural chemical tender tanks and dry boxes
12shall include units sold separately from a motor vehicle
13required to be licensed and units sold mounted on a motor
14vehicle required to be licensed if the selling price of the
15tender is separately stated.
16    Farm machinery and equipment shall include precision
17farming equipment that is installed or purchased to be
18installed on farm machinery and equipment including, but not
19limited to, tractors, harvesters, sprayers, planters, seeders,
20or spreaders. Precision farming equipment includes, but is not
21limited to, soil testing sensors, computers, monitors,
22software, global positioning and mapping systems, and other
23such equipment.
24    Farm machinery and equipment also includes computers,
25sensors, software, and related equipment used primarily in the
26computer-assisted operation of production agriculture

 

 

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1facilities, equipment, and activities such as, but not limited
2to, the collection, monitoring, and correlation of animal and
3crop data for the purpose of formulating animal diets and
4agricultural chemicals. This item (7) is exempt from the
5provisions of Section 3-55.
6    (8) Until June 30, 2013, fuel and petroleum products sold
7to or used by an air common carrier, certified by the carrier
8to be used for consumption, shipment, or storage in the conduct
9of its business as an air common carrier, for a flight destined
10for or returning from a location or locations outside the
11United States without regard to previous or subsequent domestic
12stopovers.
13    Beginning July 1, 2013, fuel and petroleum products sold to
14or used by an air carrier, certified by the carrier to be used
15for consumption, shipment, or storage in the conduct of its
16business as an air common carrier, for a flight that (i) is
17engaged in foreign trade or is engaged in trade between the
18United States and any of its possessions and (ii) transports at
19least one individual or package for hire from the city of
20origination to the city of final destination on the same
21aircraft, without regard to a change in the flight number of
22that aircraft.
23    (9) Proceeds of mandatory service charges separately
24stated on customers' bills for the purchase and consumption of
25food and beverages, to the extent that the proceeds of the
26service charge are in fact turned over as tips or as a

 

 

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1substitute for tips to the employees who participate directly
2in preparing, serving, hosting or cleaning up the food or
3beverage function with respect to which the service charge is
4imposed.
5    (10) Until July 1, 2003, oil field exploration, drilling,
6and production equipment, including (i) rigs and parts of rigs,
7rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
8tubular goods, including casing and drill strings, (iii) pumps
9and pump-jack units, (iv) storage tanks and flow lines, (v) any
10individual replacement part for oil field exploration,
11drilling, and production equipment, and (vi) machinery and
12equipment purchased for lease; but excluding motor vehicles
13required to be registered under the Illinois Vehicle Code.
14    (11) Photoprocessing machinery and equipment, including
15repair and replacement parts, both new and used, including that
16manufactured on special order, certified by the purchaser to be
17used primarily for photoprocessing, and including
18photoprocessing machinery and equipment purchased for lease.
19    (12) Coal and aggregate exploration, mining, off-highway
20hauling, processing, maintenance, and reclamation equipment,
21including replacement parts and equipment, and including
22equipment purchased for lease, but excluding motor vehicles
23required to be registered under the Illinois Vehicle Code. The
24changes made to this Section by Public Act 97-767 apply on and
25after July 1, 2003, but no claim for credit or refund is
26allowed on or after August 16, 2013 (the effective date of

 

 

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1Public Act 98-456) for such taxes paid during the period
2beginning July 1, 2003 and ending on August 16, 2013 (the
3effective date of Public Act 98-456).
4    (13) Beginning January 1, 1992 and through June 30, 2016,
5food for human consumption that is to be consumed off the
6premises where it is sold (other than alcoholic beverages, soft
7drinks and food that has been prepared for immediate
8consumption) and prescription and non-prescription medicines,
9drugs, medical appliances, and insulin, urine testing
10materials, syringes, and needles used by diabetics, for human
11use, when purchased for use by a person receiving medical
12assistance under Article V of the Illinois Public Aid Code who
13resides in a licensed long-term care facility, as defined in
14the Nursing Home Care Act, or in a licensed facility as defined
15in the ID/DD Community Care Act, the MC/DD Act, or the
16Specialized Mental Health Rehabilitation Act of 2013.
17    (14) Semen used for artificial insemination of livestock
18for direct agricultural production.
19    (15) Horses, or interests in horses, registered with and
20meeting the requirements of any of the Arabian Horse Club
21Registry of America, Appaloosa Horse Club, American Quarter
22Horse Association, United States Trotting Association, or
23Jockey Club, as appropriate, used for purposes of breeding or
24racing for prizes. This item (15) is exempt from the provisions
25of Section 3-55, and the exemption provided for under this item
26(15) applies for all periods beginning May 30, 1995, but no

 

 

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1claim for credit or refund is allowed on or after January 1,
22008 (the effective date of Public Act 95-88) for such taxes
3paid during the period beginning May 30, 2000 and ending on
4January 1, 2008 (the effective date of Public Act 95-88).
5    (16) Computers and communications equipment utilized for
6any hospital purpose and equipment used in the diagnosis,
7analysis, or treatment of hospital patients sold to a lessor
8who leases the equipment, under a lease of one year or longer
9executed or in effect at the time of the purchase, to a
10hospital that has been issued an active tax exemption
11identification number by the Department under Section 1g of the
12Retailers' Occupation Tax Act.
13    (17) Personal property sold to a lessor who leases the
14property, under a lease of one year or longer executed or in
15effect at the time of the purchase, to a governmental body that
16has been issued an active tax exemption identification number
17by the Department under Section 1g of the Retailers' Occupation
18Tax Act.
19    (18) Beginning with taxable years ending on or after
20December 31, 1995 and ending with taxable years ending on or
21before December 31, 2004, personal property that is donated for
22disaster relief to be used in a State or federally declared
23disaster area in Illinois or bordering Illinois by a
24manufacturer or retailer that is registered in this State to a
25corporation, society, association, foundation, or institution
26that has been issued a sales tax exemption identification

 

 

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1number by the Department that assists victims of the disaster
2who reside within the declared disaster area.
3    (19) Beginning with taxable years ending on or after
4December 31, 1995 and ending with taxable years ending on or
5before December 31, 2004, personal property that is used in the
6performance of infrastructure repairs in this State, including
7but not limited to municipal roads and streets, access roads,
8bridges, sidewalks, waste disposal systems, water and sewer
9line extensions, water distribution and purification
10facilities, storm water drainage and retention facilities, and
11sewage treatment facilities, resulting from a State or
12federally declared disaster in Illinois or bordering Illinois
13when such repairs are initiated on facilities located in the
14declared disaster area within 6 months after the disaster.
15    (20) Beginning July 1, 1999, game or game birds sold at a
16"game breeding and hunting preserve area" as that term is used
17in the Wildlife Code. This paragraph is exempt from the
18provisions of Section 3-55.
19    (21) A motor vehicle, as that term is defined in Section
201-146 of the Illinois Vehicle Code, that is donated to a
21corporation, limited liability company, society, association,
22foundation, or institution that is determined by the Department
23to be organized and operated exclusively for educational
24purposes. For purposes of this exemption, "a corporation,
25limited liability company, society, association, foundation,
26or institution organized and operated exclusively for

 

 

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1educational purposes" means all tax-supported public schools,
2private schools that offer systematic instruction in useful
3branches of learning by methods common to public schools and
4that compare favorably in their scope and intensity with the
5course of study presented in tax-supported schools, and
6vocational or technical schools or institutes organized and
7operated exclusively to provide a course of study of not less
8than 6 weeks duration and designed to prepare individuals to
9follow a trade or to pursue a manual, technical, mechanical,
10industrial, business, or commercial occupation.
11    (22) Beginning January 1, 2000, personal property,
12including food, purchased through fundraising events for the
13benefit of a public or private elementary or secondary school,
14a group of those schools, or one or more school districts if
15the events are sponsored by an entity recognized by the school
16district that consists primarily of volunteers and includes
17parents and teachers of the school children. This paragraph
18does not apply to fundraising events (i) for the benefit of
19private home instruction or (ii) for which the fundraising
20entity purchases the personal property sold at the events from
21another individual or entity that sold the property for the
22purpose of resale by the fundraising entity and that profits
23from the sale to the fundraising entity. This paragraph is
24exempt from the provisions of Section 3-55.
25    (23) Beginning January 1, 2000 and through December 31,
262001, new or used automatic vending machines that prepare and

 

 

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1serve hot food and beverages, including coffee, soup, and other
2items, and replacement parts for these machines. Beginning
3January 1, 2002 and through June 30, 2003, machines and parts
4for machines used in commercial, coin-operated amusement and
5vending business if a use or occupation tax is paid on the
6gross receipts derived from the use of the commercial,
7coin-operated amusement and vending machines. This paragraph
8is exempt from the provisions of Section 3-55.
9    (24) Beginning on the effective date of this amendatory Act
10of the 92nd General Assembly, computers and communications
11equipment utilized for any hospital purpose and equipment used
12in the diagnosis, analysis, or treatment of hospital patients
13sold to a lessor who leases the equipment, under a lease of one
14year or longer executed or in effect at the time of the
15purchase, to a hospital that has been issued an active tax
16exemption identification number by the Department under
17Section 1g of the Retailers' Occupation Tax Act. This paragraph
18is exempt from the provisions of Section 3-55.
19    (25) Beginning on the effective date of this amendatory Act
20of the 92nd General Assembly, personal property sold to a
21lessor who leases the property, under a lease of one year or
22longer executed or in effect at the time of the purchase, to a
23governmental body that has been issued an active tax exemption
24identification number by the Department under Section 1g of the
25Retailers' Occupation Tax Act. This paragraph is exempt from
26the provisions of Section 3-55.

 

 

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1    (26) Beginning on January 1, 2002 and through June 30, 2021
2June 30, 2016, tangible personal property purchased from an
3Illinois retailer by a taxpayer engaged in centralized
4purchasing activities in Illinois who will, upon receipt of the
5property in Illinois, temporarily store the property in
6Illinois (i) for the purpose of subsequently transporting it
7outside this State for use or consumption thereafter solely
8outside this State or (ii) for the purpose of being processed,
9fabricated, or manufactured into, attached to, or incorporated
10into other tangible personal property to be transported outside
11this State and thereafter used or consumed solely outside this
12State. The Director of Revenue shall, pursuant to rules adopted
13in accordance with the Illinois Administrative Procedure Act,
14issue a permit to any taxpayer in good standing with the
15Department who is eligible for the exemption under this
16paragraph (26). The permit issued under this paragraph (26)
17shall authorize the holder, to the extent and in the manner
18specified in the rules adopted under this Act, to purchase
19tangible personal property from a retailer exempt from the
20taxes imposed by this Act. Taxpayers shall maintain all
21necessary books and records to substantiate the use and
22consumption of all such tangible personal property outside of
23the State of Illinois.
24    (27) Beginning January 1, 2008, tangible personal property
25used in the construction or maintenance of a community water
26supply, as defined under Section 3.145 of the Environmental

 

 

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1Protection Act, that is operated by a not-for-profit
2corporation that holds a valid water supply permit issued under
3Title IV of the Environmental Protection Act. This paragraph is
4exempt from the provisions of Section 3-55.
5    (28) Tangible personal property sold to a
6public-facilities corporation, as described in Section
711-65-10 of the Illinois Municipal Code, for purposes of
8constructing or furnishing a municipal convention hall, but
9only if the legal title to the municipal convention hall is
10transferred to the municipality without any further
11consideration by or on behalf of the municipality at the time
12of the completion of the municipal convention hall or upon the
13retirement or redemption of any bonds or other debt instruments
14issued by the public-facilities corporation in connection with
15the development of the municipal convention hall. This
16exemption includes existing public-facilities corporations as
17provided in Section 11-65-25 of the Illinois Municipal Code.
18This paragraph is exempt from the provisions of Section 3-55.
19    (29) Beginning January 1, 2010, materials, parts,
20equipment, components, and furnishings incorporated into or
21upon an aircraft as part of the modification, refurbishment,
22completion, replacement, repair, or maintenance of the
23aircraft. This exemption includes consumable supplies used in
24the modification, refurbishment, completion, replacement,
25repair, and maintenance of aircraft, but excludes any
26materials, parts, equipment, components, and consumable

 

 

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1supplies used in the modification, replacement, repair, and
2maintenance of aircraft engines or power plants, whether such
3engines or power plants are installed or uninstalled upon any
4such aircraft. "Consumable supplies" include, but are not
5limited to, adhesive, tape, sandpaper, general purpose
6lubricants, cleaning solution, latex gloves, and protective
7films. This exemption applies only to the transfer of
8qualifying tangible personal property incident to the
9modification, refurbishment, completion, replacement, repair,
10or maintenance of an aircraft by persons who (i) hold an Air
11Agency Certificate and are empowered to operate an approved
12repair station by the Federal Aviation Administration, (ii)
13have a Class IV Rating, and (iii) conduct operations in
14accordance with Part 145 of the Federal Aviation Regulations.
15The exemption does not include aircraft operated by a
16commercial air carrier providing scheduled passenger air
17service pursuant to authority issued under Part 121 or Part 129
18of the Federal Aviation Regulations. The changes made to this
19paragraph (29) by Public Act 98-534 are declarative of existing
20law.
21(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
2298-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-756, eff.
237-16-14; 99-180, eff. 7-29-15.)
 
24    Section 20. The Retailers' Occupation Tax Act is amended by
25changing Section 2-5 as follows:
 

 

 

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1    (35 ILCS 120/2-5)
2    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
3sale of the following tangible personal property are exempt
4from the tax imposed by this Act:
5    (1) Farm chemicals.
6    (2) Farm machinery and equipment, both new and used,
7including that manufactured on special order, certified by the
8purchaser to be used primarily for production agriculture or
9State or federal agricultural programs, including individual
10replacement parts for the machinery and equipment, including
11machinery and equipment purchased for lease, and including
12implements of husbandry defined in Section 1-130 of the
13Illinois Vehicle Code, farm machinery and agricultural
14chemical and fertilizer spreaders, and nurse wagons required to
15be registered under Section 3-809 of the Illinois Vehicle Code,
16but excluding other motor vehicles required to be registered
17under the Illinois Vehicle Code. Horticultural polyhouses or
18hoop houses used for propagating, growing, or overwintering
19plants shall be considered farm machinery and equipment under
20this item (2). Agricultural chemical tender tanks and dry boxes
21shall include units sold separately from a motor vehicle
22required to be licensed and units sold mounted on a motor
23vehicle required to be licensed, if the selling price of the
24tender is separately stated.
25    Farm machinery and equipment shall include precision

 

 

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1farming equipment that is installed or purchased to be
2installed on farm machinery and equipment including, but not
3limited to, tractors, harvesters, sprayers, planters, seeders,
4or spreaders. Precision farming equipment includes, but is not
5limited to, soil testing sensors, computers, monitors,
6software, global positioning and mapping systems, and other
7such equipment.
8    Farm machinery and equipment also includes computers,
9sensors, software, and related equipment used primarily in the
10computer-assisted operation of production agriculture
11facilities, equipment, and activities such as, but not limited
12to, the collection, monitoring, and correlation of animal and
13crop data for the purpose of formulating animal diets and
14agricultural chemicals. This item (2) is exempt from the
15provisions of Section 2-70.
16    (3) Until July 1, 2003, distillation machinery and
17equipment, sold as a unit or kit, assembled or installed by the
18retailer, certified by the user to be used only for the
19production of ethyl alcohol that will be used for consumption
20as motor fuel or as a component of motor fuel for the personal
21use of the user, and not subject to sale or resale.
22    (4) Until July 1, 2003 and beginning again September 1,
232004 through August 30, 2014, graphic arts machinery and
24equipment, including repair and replacement parts, both new and
25used, and including that manufactured on special order or
26purchased for lease, certified by the purchaser to be used

 

 

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1primarily for graphic arts production. Equipment includes
2chemicals or chemicals acting as catalysts but only if the
3chemicals or chemicals acting as catalysts effect a direct and
4immediate change upon a graphic arts product.
5    (5) A motor vehicle that is used for automobile renting, as
6defined in the Automobile Renting Occupation and Use Tax Act.
7This paragraph is exempt from the provisions of Section 2-70.
8    (6) Personal property sold by a teacher-sponsored student
9organization affiliated with an elementary or secondary school
10located in Illinois.
11    (7) Until July 1, 2003, proceeds of that portion of the
12selling price of a passenger car the sale of which is subject
13to the Replacement Vehicle Tax.
14    (8) Personal property sold to an Illinois county fair
15association for use in conducting, operating, or promoting the
16county fair.
17    (9) Personal property sold to a not-for-profit arts or
18cultural organization that establishes, by proof required by
19the Department by rule, that it has received an exemption under
20Section 501(c)(3) of the Internal Revenue Code and that is
21organized and operated primarily for the presentation or
22support of arts or cultural programming, activities, or
23services. These organizations include, but are not limited to,
24music and dramatic arts organizations such as symphony
25orchestras and theatrical groups, arts and cultural service
26organizations, local arts councils, visual arts organizations,

 

 

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1and media arts organizations. On and after the effective date
2of this amendatory Act of the 92nd General Assembly, however,
3an entity otherwise eligible for this exemption shall not make
4tax-free purchases unless it has an active identification
5number issued by the Department.
6    (10) Personal property sold by a corporation, society,
7association, foundation, institution, or organization, other
8than a limited liability company, that is organized and
9operated as a not-for-profit service enterprise for the benefit
10of persons 65 years of age or older if the personal property
11was not purchased by the enterprise for the purpose of resale
12by the enterprise.
13    (11) Personal property sold to a governmental body, to a
14corporation, society, association, foundation, or institution
15organized and operated exclusively for charitable, religious,
16or educational purposes, or to a not-for-profit corporation,
17society, association, foundation, institution, or organization
18that has no compensated officers or employees and that is
19organized and operated primarily for the recreation of persons
2055 years of age or older. A limited liability company may
21qualify for the exemption under this paragraph only if the
22limited liability company is organized and operated
23exclusively for educational purposes. On and after July 1,
241987, however, no entity otherwise eligible for this exemption
25shall make tax-free purchases unless it has an active
26identification number issued by the Department.

 

 

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1    (12) Tangible personal property sold to interstate
2carriers for hire for use as rolling stock moving in interstate
3commerce or to lessors under leases of one year or longer
4executed or in effect at the time of purchase by interstate
5carriers for hire for use as rolling stock moving in interstate
6commerce and equipment operated by a telecommunications
7provider, licensed as a common carrier by the Federal
8Communications Commission, which is permanently installed in
9or affixed to aircraft moving in interstate commerce.
10    (12-5) On and after July 1, 2003 and through June 30, 2004,
11motor vehicles of the second division with a gross vehicle
12weight in excess of 8,000 pounds that are subject to the
13commercial distribution fee imposed under Section 3-815.1 of
14the Illinois Vehicle Code. Beginning on July 1, 2004 and
15through June 30, 2005, the use in this State of motor vehicles
16of the second division: (i) with a gross vehicle weight rating
17in excess of 8,000 pounds; (ii) that are subject to the
18commercial distribution fee imposed under Section 3-815.1 of
19the Illinois Vehicle Code; and (iii) that are primarily used
20for commercial purposes. Through June 30, 2005, this exemption
21applies to repair and replacement parts added after the initial
22purchase of such a motor vehicle if that motor vehicle is used
23in a manner that would qualify for the rolling stock exemption
24otherwise provided for in this Act. For purposes of this
25paragraph, "used for commercial purposes" means the
26transportation of persons or property in furtherance of any

 

 

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1commercial or industrial enterprise whether for-hire or not.
2    (13) Proceeds from sales to owners, lessors, or shippers of
3tangible personal property that is utilized by interstate
4carriers for hire for use as rolling stock moving in interstate
5commerce and equipment operated by a telecommunications
6provider, licensed as a common carrier by the Federal
7Communications Commission, which is permanently installed in
8or affixed to aircraft moving in interstate commerce.
9    (14) Machinery and equipment that will be used by the
10purchaser, or a lessee of the purchaser, primarily in the
11process of manufacturing or assembling tangible personal
12property for wholesale or retail sale or lease, whether the
13sale or lease is made directly by the manufacturer or by some
14other person, whether the materials used in the process are
15owned by the manufacturer or some other person, or whether the
16sale or lease is made apart from or as an incident to the
17seller's engaging in the service occupation of producing
18machines, tools, dies, jigs, patterns, gauges, or other similar
19items of no commercial value on special order for a particular
20purchaser. The exemption provided by this paragraph (14) does
21not include machinery and equipment used in (i) the generation
22of electricity for wholesale or retail sale; (ii) the
23generation or treatment of natural or artificial gas for
24wholesale or retail sale that is delivered to customers through
25pipes, pipelines, or mains; or (iii) the treatment of water for
26wholesale or retail sale that is delivered to customers through

 

 

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1pipes, pipelines, or mains. The provisions of Public Act 98-583
2are declaratory of existing law as to the meaning and scope of
3this exemption.
4    (15) Proceeds of mandatory service charges separately
5stated on customers' bills for purchase and consumption of food
6and beverages, to the extent that the proceeds of the service
7charge are in fact turned over as tips or as a substitute for
8tips to the employees who participate directly in preparing,
9serving, hosting or cleaning up the food or beverage function
10with respect to which the service charge is imposed.
11    (16) Petroleum products sold to a purchaser if the seller
12is prohibited by federal law from charging tax to the
13purchaser.
14    (17) Tangible personal property sold to a common carrier by
15rail or motor that receives the physical possession of the
16property in Illinois and that transports the property, or
17shares with another common carrier in the transportation of the
18property, out of Illinois on a standard uniform bill of lading
19showing the seller of the property as the shipper or consignor
20of the property to a destination outside Illinois, for use
21outside Illinois.
22    (18) Legal tender, currency, medallions, or gold or silver
23coinage issued by the State of Illinois, the government of the
24United States of America, or the government of any foreign
25country, and bullion.
26    (19) Until July 1 2003, oil field exploration, drilling,

 

 

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1and production equipment, including (i) rigs and parts of rigs,
2rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
3tubular goods, including casing and drill strings, (iii) pumps
4and pump-jack units, (iv) storage tanks and flow lines, (v) any
5individual replacement part for oil field exploration,
6drilling, and production equipment, and (vi) machinery and
7equipment purchased for lease; but excluding motor vehicles
8required to be registered under the Illinois Vehicle Code.
9    (20) Photoprocessing machinery and equipment, including
10repair and replacement parts, both new and used, including that
11manufactured on special order, certified by the purchaser to be
12used primarily for photoprocessing, and including
13photoprocessing machinery and equipment purchased for lease.
14    (21) Coal and aggregate exploration, mining, off-highway
15hauling, processing, maintenance, and reclamation equipment,
16including replacement parts and equipment, and including
17equipment purchased for lease, but excluding motor vehicles
18required to be registered under the Illinois Vehicle Code. The
19changes made to this Section by Public Act 97-767 apply on and
20after July 1, 2003, but no claim for credit or refund is
21allowed on or after August 16, 2013 (the effective date of
22Public Act 98-456) for such taxes paid during the period
23beginning July 1, 2003 and ending on August 16, 2013 (the
24effective date of Public Act 98-456).
25    (22) Until June 30, 2013, fuel and petroleum products sold
26to or used by an air carrier, certified by the carrier to be

 

 

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1used for consumption, shipment, or storage in the conduct of
2its business as an air common carrier, for a flight destined
3for or returning from a location or locations outside the
4United States without regard to previous or subsequent domestic
5stopovers.
6    Beginning July 1, 2013, fuel and petroleum products sold to
7or used by an air carrier, certified by the carrier to be used
8for consumption, shipment, or storage in the conduct of its
9business as an air common carrier, for a flight that (i) is
10engaged in foreign trade or is engaged in trade between the
11United States and any of its possessions and (ii) transports at
12least one individual or package for hire from the city of
13origination to the city of final destination on the same
14aircraft, without regard to a change in the flight number of
15that aircraft.
16    (23) A transaction in which the purchase order is received
17by a florist who is located outside Illinois, but who has a
18florist located in Illinois deliver the property to the
19purchaser or the purchaser's donee in Illinois.
20    (24) Fuel consumed or used in the operation of ships,
21barges, or vessels that are used primarily in or for the
22transportation of property or the conveyance of persons for
23hire on rivers bordering on this State if the fuel is delivered
24by the seller to the purchaser's barge, ship, or vessel while
25it is afloat upon that bordering river.
26    (25) Except as provided in item (25-5) of this Section, a

 

 

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1motor vehicle sold in this State to a nonresident even though
2the motor vehicle is delivered to the nonresident in this
3State, if the motor vehicle is not to be titled in this State,
4and if a drive-away permit is issued to the motor vehicle as
5provided in Section 3-603 of the Illinois Vehicle Code or if
6the nonresident purchaser has vehicle registration plates to
7transfer to the motor vehicle upon returning to his or her home
8state. The issuance of the drive-away permit or having the
9out-of-state registration plates to be transferred is prima
10facie evidence that the motor vehicle will not be titled in
11this State.
12    (25-5) The exemption under item (25) does not apply if the
13state in which the motor vehicle will be titled does not allow
14a reciprocal exemption for a motor vehicle sold and delivered
15in that state to an Illinois resident but titled in Illinois.
16The tax collected under this Act on the sale of a motor vehicle
17in this State to a resident of another state that does not
18allow a reciprocal exemption shall be imposed at a rate equal
19to the state's rate of tax on taxable property in the state in
20which the purchaser is a resident, except that the tax shall
21not exceed the tax that would otherwise be imposed under this
22Act. At the time of the sale, the purchaser shall execute a
23statement, signed under penalty of perjury, of his or her
24intent to title the vehicle in the state in which the purchaser
25is a resident within 30 days after the sale and of the fact of
26the payment to the State of Illinois of tax in an amount

 

 

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1equivalent to the state's rate of tax on taxable property in
2his or her state of residence and shall submit the statement to
3the appropriate tax collection agency in his or her state of
4residence. In addition, the retailer must retain a signed copy
5of the statement in his or her records. Nothing in this item
6shall be construed to require the removal of the vehicle from
7this state following the filing of an intent to title the
8vehicle in the purchaser's state of residence if the purchaser
9titles the vehicle in his or her state of residence within 30
10days after the date of sale. The tax collected under this Act
11in accordance with this item (25-5) shall be proportionately
12distributed as if the tax were collected at the 6.25% general
13rate imposed under this Act.
14    (25-7) Beginning on July 1, 2007, no tax is imposed under
15this Act on the sale of an aircraft, as defined in Section 3 of
16the Illinois Aeronautics Act, if all of the following
17conditions are met:
18        (1) the aircraft leaves this State within 15 days after
19    the later of either the issuance of the final billing for
20    the sale of the aircraft, or the authorized approval for
21    return to service, completion of the maintenance record
22    entry, and completion of the test flight and ground test
23    for inspection, as required by 14 C.F.R. 91.407;
24        (2) the aircraft is not based or registered in this
25    State after the sale of the aircraft; and
26        (3) the seller retains in his or her books and records

 

 

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1    and provides to the Department a signed and dated
2    certification from the purchaser, on a form prescribed by
3    the Department, certifying that the requirements of this
4    item (25-7) are met. The certificate must also include the
5    name and address of the purchaser, the address of the
6    location where the aircraft is to be titled or registered,
7    the address of the primary physical location of the
8    aircraft, and other information that the Department may
9    reasonably require.
10    For purposes of this item (25-7):
11    "Based in this State" means hangared, stored, or otherwise
12used, excluding post-sale customizations as defined in this
13Section, for 10 or more days in each 12-month period
14immediately following the date of the sale of the aircraft.
15    "Registered in this State" means an aircraft registered
16with the Department of Transportation, Aeronautics Division,
17or titled or registered with the Federal Aviation
18Administration to an address located in this State.
19    This paragraph (25-7) is exempt from the provisions of
20Section 2-70.
21    (26) Semen used for artificial insemination of livestock
22for direct agricultural production.
23    (27) Horses, or interests in horses, registered with and
24meeting the requirements of any of the Arabian Horse Club
25Registry of America, Appaloosa Horse Club, American Quarter
26Horse Association, United States Trotting Association, or

 

 

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1Jockey Club, as appropriate, used for purposes of breeding or
2racing for prizes. This item (27) is exempt from the provisions
3of Section 2-70, and the exemption provided for under this item
4(27) applies for all periods beginning May 30, 1995, but no
5claim for credit or refund is allowed on or after January 1,
62008 (the effective date of Public Act 95-88) for such taxes
7paid during the period beginning May 30, 2000 and ending on
8January 1, 2008 (the effective date of Public Act 95-88).
9    (28) Computers and communications equipment utilized for
10any hospital purpose and equipment used in the diagnosis,
11analysis, or treatment of hospital patients sold to a lessor
12who leases the equipment, under a lease of one year or longer
13executed or in effect at the time of the purchase, to a
14hospital that has been issued an active tax exemption
15identification number by the Department under Section 1g of
16this Act.
17    (29) Personal property sold to a lessor who leases the
18property, under a lease of one year or longer executed or in
19effect at the time of the purchase, to a governmental body that
20has been issued an active tax exemption identification number
21by the Department under Section 1g of this Act.
22    (30) Beginning with taxable years ending on or after
23December 31, 1995 and ending with taxable years ending on or
24before December 31, 2004, personal property that is donated for
25disaster relief to be used in a State or federally declared
26disaster area in Illinois or bordering Illinois by a

 

 

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1manufacturer or retailer that is registered in this State to a
2corporation, society, association, foundation, or institution
3that has been issued a sales tax exemption identification
4number by the Department that assists victims of the disaster
5who reside within the declared disaster area.
6    (31) Beginning with taxable years ending on or after
7December 31, 1995 and ending with taxable years ending on or
8before December 31, 2004, personal property that is used in the
9performance of infrastructure repairs in this State, including
10but not limited to municipal roads and streets, access roads,
11bridges, sidewalks, waste disposal systems, water and sewer
12line extensions, water distribution and purification
13facilities, storm water drainage and retention facilities, and
14sewage treatment facilities, resulting from a State or
15federally declared disaster in Illinois or bordering Illinois
16when such repairs are initiated on facilities located in the
17declared disaster area within 6 months after the disaster.
18    (32) Beginning July 1, 1999, game or game birds sold at a
19"game breeding and hunting preserve area" as that term is used
20in the Wildlife Code. This paragraph is exempt from the
21provisions of Section 2-70.
22    (33) A motor vehicle, as that term is defined in Section
231-146 of the Illinois Vehicle Code, that is donated to a
24corporation, limited liability company, society, association,
25foundation, or institution that is determined by the Department
26to be organized and operated exclusively for educational

 

 

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1purposes. For purposes of this exemption, "a corporation,
2limited liability company, society, association, foundation,
3or institution organized and operated exclusively for
4educational purposes" means all tax-supported public schools,
5private schools that offer systematic instruction in useful
6branches of learning by methods common to public schools and
7that compare favorably in their scope and intensity with the
8course of study presented in tax-supported schools, and
9vocational or technical schools or institutes organized and
10operated exclusively to provide a course of study of not less
11than 6 weeks duration and designed to prepare individuals to
12follow a trade or to pursue a manual, technical, mechanical,
13industrial, business, or commercial occupation.
14    (34) Beginning January 1, 2000, personal property,
15including food, purchased through fundraising events for the
16benefit of a public or private elementary or secondary school,
17a group of those schools, or one or more school districts if
18the events are sponsored by an entity recognized by the school
19district that consists primarily of volunteers and includes
20parents and teachers of the school children. This paragraph
21does not apply to fundraising events (i) for the benefit of
22private home instruction or (ii) for which the fundraising
23entity purchases the personal property sold at the events from
24another individual or entity that sold the property for the
25purpose of resale by the fundraising entity and that profits
26from the sale to the fundraising entity. This paragraph is

 

 

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1exempt from the provisions of Section 2-70.
2    (35) Beginning January 1, 2000 and through December 31,
32001, new or used automatic vending machines that prepare and
4serve hot food and beverages, including coffee, soup, and other
5items, and replacement parts for these machines. Beginning
6January 1, 2002 and through June 30, 2003, machines and parts
7for machines used in commercial, coin-operated amusement and
8vending business if a use or occupation tax is paid on the
9gross receipts derived from the use of the commercial,
10coin-operated amusement and vending machines. This paragraph
11is exempt from the provisions of Section 2-70.
12    (35-5) Beginning August 23, 2001 and through June 30, 2016,
13food for human consumption that is to be consumed off the
14premises where it is sold (other than alcoholic beverages, soft
15drinks, and food that has been prepared for immediate
16consumption) and prescription and nonprescription medicines,
17drugs, medical appliances, and insulin, urine testing
18materials, syringes, and needles used by diabetics, for human
19use, when purchased for use by a person receiving medical
20assistance under Article V of the Illinois Public Aid Code who
21resides in a licensed long-term care facility, as defined in
22the Nursing Home Care Act, or a licensed facility as defined in
23the ID/DD Community Care Act, the MC/DD Act, or the Specialized
24Mental Health Rehabilitation Act of 2013.
25    (36) Beginning August 2, 2001, computers and
26communications equipment utilized for any hospital purpose and

 

 

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1equipment used in the diagnosis, analysis, or treatment of
2hospital patients sold to a lessor who leases the equipment,
3under a lease of one year or longer executed or in effect at
4the time of the purchase, to a hospital that has been issued an
5active tax exemption identification number by the Department
6under Section 1g of this Act. This paragraph is exempt from the
7provisions of Section 2-70.
8    (37) Beginning August 2, 2001, personal property sold to a
9lessor who leases the property, under a lease of one year or
10longer executed or in effect at the time of the purchase, to a
11governmental body that has been issued an active tax exemption
12identification number by the Department under Section 1g of
13this Act. This paragraph is exempt from the provisions of
14Section 2-70.
15    (38) Beginning on January 1, 2002 and through June 30, 2021
16June 30, 2016, tangible personal property purchased from an
17Illinois retailer by a taxpayer engaged in centralized
18purchasing activities in Illinois who will, upon receipt of the
19property in Illinois, temporarily store the property in
20Illinois (i) for the purpose of subsequently transporting it
21outside this State for use or consumption thereafter solely
22outside this State or (ii) for the purpose of being processed,
23fabricated, or manufactured into, attached to, or incorporated
24into other tangible personal property to be transported outside
25this State and thereafter used or consumed solely outside this
26State. The Director of Revenue shall, pursuant to rules adopted

 

 

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1in accordance with the Illinois Administrative Procedure Act,
2issue a permit to any taxpayer in good standing with the
3Department who is eligible for the exemption under this
4paragraph (38). The permit issued under this paragraph (38)
5shall authorize the holder, to the extent and in the manner
6specified in the rules adopted under this Act, to purchase
7tangible personal property from a retailer exempt from the
8taxes imposed by this Act. Taxpayers shall maintain all
9necessary books and records to substantiate the use and
10consumption of all such tangible personal property outside of
11the State of Illinois.
12    (39) Beginning January 1, 2008, tangible personal property
13used in the construction or maintenance of a community water
14supply, as defined under Section 3.145 of the Environmental
15Protection Act, that is operated by a not-for-profit
16corporation that holds a valid water supply permit issued under
17Title IV of the Environmental Protection Act. This paragraph is
18exempt from the provisions of Section 2-70.
19    (40) Beginning January 1, 2010, materials, parts,
20equipment, components, and furnishings incorporated into or
21upon an aircraft as part of the modification, refurbishment,
22completion, replacement, repair, or maintenance of the
23aircraft. This exemption includes consumable supplies used in
24the modification, refurbishment, completion, replacement,
25repair, and maintenance of aircraft, but excludes any
26materials, parts, equipment, components, and consumable

 

 

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1supplies used in the modification, replacement, repair, and
2maintenance of aircraft engines or power plants, whether such
3engines or power plants are installed or uninstalled upon any
4such aircraft. "Consumable supplies" include, but are not
5limited to, adhesive, tape, sandpaper, general purpose
6lubricants, cleaning solution, latex gloves, and protective
7films. This exemption applies only to the sale of qualifying
8tangible personal property to persons who modify, refurbish,
9complete, replace, or maintain an aircraft and who (i) hold an
10Air Agency Certificate and are empowered to operate an approved
11repair station by the Federal Aviation Administration, (ii)
12have a Class IV Rating, and (iii) conduct operations in
13accordance with Part 145 of the Federal Aviation Regulations.
14The exemption does not include aircraft operated by a
15commercial air carrier providing scheduled passenger air
16service pursuant to authority issued under Part 121 or Part 129
17of the Federal Aviation Regulations. The changes made to this
18paragraph (40) by Public Act 98-534 are declarative of existing
19law.
20    (41) Tangible personal property sold to a
21public-facilities corporation, as described in Section
2211-65-10 of the Illinois Municipal Code, for purposes of
23constructing or furnishing a municipal convention hall, but
24only if the legal title to the municipal convention hall is
25transferred to the municipality without any further
26consideration by or on behalf of the municipality at the time

 

 

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1of the completion of the municipal convention hall or upon the
2retirement or redemption of any bonds or other debt instruments
3issued by the public-facilities corporation in connection with
4the development of the municipal convention hall. This
5exemption includes existing public-facilities corporations as
6provided in Section 11-65-25 of the Illinois Municipal Code.
7This paragraph is exempt from the provisions of Section 2-70.
8(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
998-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-574, eff.
101-1-14; 98-583, eff. 1-1-14; 98-756, eff. 7-16-14; 99-180, eff.
117-29-15.)
 
12    Section 99. Effective date. This Act takes effect upon
13becoming law.