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PUBLIC HEALTH
(410 ILCS 705/) Cannabis Regulation and Tax Act.

410 ILCS 705/60-5

    (410 ILCS 705/60-5)
    Sec. 60-5. Definitions. In this Article:
    "Cannabis" has the meaning given to that term in Article 1 of this Act, except that it does not include cannabis that is subject to tax under the Compassionate Use of Medical Cannabis Program Act.
    "Craft grower" has the meaning given to that term in Article 1 of this Act.
    "Cultivation center" has the meaning given to that term in Article 1 of this Act.
    "Cultivator" or "taxpayer" means a cultivation center or craft grower who is subject to tax under this Article.
    "Department" means the Department of Revenue.
    "Director" means the Director of Revenue.
    "Dispensing organization" or "dispensary" has the meaning given to that term in Article 1 of this Act.
    "Gross receipts" from the sales of cannabis by a cultivator means the total selling price or the amount of such sales, as defined in this Article. In the case of charges and time sales, the amount thereof shall be included only when payments are received by the cultivator.
    "Person" means a natural individual, firm, partnership, association, joint stock company, joint adventure, public or private corporation, limited liability company, or a receiver, executor, trustee, guardian, or other representative appointed by order of any court.
    "Infuser" means "infuser organization" or "infuser" as defined in Article 1 of this Act.
    "Selling price" or "amount of sale" means the consideration for a sale valued in money whether received in money or otherwise, including cash, credits, property, and services, and shall be determined without any deduction on account of the cost of the property sold, the cost of materials used, labor or service cost, or any other expense whatsoever, but does not include separately stated charges identified on the invoice by cultivators to reimburse themselves for their tax liability under this Article.
(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

410 ILCS 705/60-10

    (410 ILCS 705/60-10)
    Sec. 60-10. Tax imposed.
    (a) Beginning September 1, 2019, a tax is imposed upon the privilege of cultivating cannabis at the rate of 7% of the gross receipts from the first sale of cannabis by a cultivator. The sale of any product that contains any amount of cannabis or any derivative thereof is subject to the tax under this Section on the full selling price of the product. The Department may determine the selling price of the cannabis when the seller and purchaser are affiliated persons, when the sale and purchase of cannabis is not an arm's length transaction, or when cannabis is transferred by a craft grower to the craft grower's dispensing organization or infuser or processing organization and a value is not established for the cannabis. The value determined by the Department shall be commensurate with the actual price received for products of like quality, character, and use in the area. If there are no sales of cannabis of like quality, character, and use in the same area, then the Department shall establish a reasonable value based on sales of products of like quality, character, and use in other areas of the State, taking into consideration any other relevant factors.
    (b) The Cannabis Cultivation Privilege Tax imposed under this Article is solely the responsibility of the cultivator who makes the first sale and is not the responsibility of a subsequent purchaser, a dispensing organization, or an infuser. Persons subject to the tax imposed under this Article may, however, reimburse themselves for their tax liability hereunder by separately stating reimbursement for their tax liability as an additional charge.
    (c) The tax imposed under this Article shall be in addition to all other occupation, privilege, or excise taxes imposed by the State of Illinois or by any unit of local government.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/60-15

    (410 ILCS 705/60-15)
    Sec. 60-15. Registration of cultivators. Every cultivator and craft grower subject to the tax under this Article shall apply to the Department of Revenue for a certificate of registration under this Article. All applications for registration under this Article shall be made by electronic means in the form and manner required by the Department. For that purpose, the provisions of Section 2a of the Retailers' Occupation Tax Act are incorporated into this Article to the extent not inconsistent with this Article. In addition, no certificate of registration shall be issued under this Article unless the applicant is licensed under this Act.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/60-20

    (410 ILCS 705/60-20)
    Sec. 60-20. Return and payment of cannabis cultivation privilege tax. Each person who is required to pay the tax imposed by this Article shall make a return to the Department on or before the 20th day of each month for the preceding calendar month stating the following:
        (1) the taxpayer's name;
        (2) the address of the taxpayer's principal place of
    
business and the address of the principal place of business (if that is a different address) from which the taxpayer is engaged in the business of cultivating cannabis subject to tax under this Article;
        (3) the total amount of receipts received by the
    
taxpayer during the preceding calendar month from sales of cannabis subject to tax under this Article by the taxpayer during the preceding calendar month;
        (4) the total amount received by the taxpayer during
    
the preceding calendar month on charge and time sales of cannabis subject to tax imposed under this Article by the taxpayer before the month for which the return is filed;
        (5) deductions allowed by law;
        (6) gross receipts that were received by the taxpayer
    
during the preceding calendar month and upon the basis of which the tax is imposed;
        (7) the amount of tax due;
        (8) the signature of the taxpayer; and
        (9) any other information as the Department may
    
reasonably require.
    All returns required to be filed and payments required to be made under this Article shall be by electronic means. Taxpayers who demonstrate hardship in paying electronically may petition the Department to waive the electronic payment requirement. The Department may require a separate return for the tax under this Article or combine the return for the tax under this Article with the return for the tax under the Compassionate Use of Medical Cannabis Program Act. If the return for the tax under this Article is combined with the return for tax under the Compassionate Use of Medical Cannabis Program Act, then the vendor's discount allowed under this Section and any cap on that discount shall apply to the combined return. The taxpayer making the return provided for in this Section shall also pay to the Department, in accordance with this Section, the amount of tax imposed by this Article, less a discount of 1.75%, but not to exceed $1,000 per return period, which is allowed to reimburse the taxpayer for the expenses incurred in keeping records, collecting tax, preparing and filing returns, remitting the tax, and supplying data to the Department upon request. No discount may be claimed by a taxpayer on returns not timely filed and for taxes not timely remitted. No discount may be claimed by a taxpayer for any return that is not filed electronically. No discount may be claimed by a taxpayer for any payment that is not made electronically, unless a waiver has been granted under this Section. Any amount that is required to be shown or reported on any return or other document under this Article shall, if the amount is not a whole-dollar amount, be increased to the nearest whole-dollar amount if the fractional part of a dollar is $0.50 or more and decreased to the nearest whole-dollar amount if the fractional part of a dollar is less than $0.50. If a total amount of less than $1 is payable, refundable, or creditable, the amount shall be disregarded if it is less than $0.50 and shall be increased to $1 if it is $0.50 or more. Notwithstanding any other provision of this Article concerning the time within which a taxpayer may file a return, any such taxpayer who ceases to engage in the kind of business that makes the person responsible for filing returns under this Article shall file a final return under this Article with the Department within one month after discontinuing such business.
    Each taxpayer under this Article shall make estimated payments to the Department on or before the 7th, 15th, 22nd, and last day of the month during which tax liability to the Department is incurred. The payments shall be in an amount not less than the lower of either 22.5% of the taxpayer's actual tax liability for the month or 25% of the taxpayer's actual tax liability for the same calendar month of the preceding year. The amount of the quarter-monthly payments shall be credited against the final tax liability of the taxpayer's return for that month. If any quarter-monthly payment is not paid at the time or in the amount required by this Section, then the taxpayer shall be liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of the quarter-monthly payment actually and timely paid, except insofar as the taxpayer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section.
    If any payment provided for in this Section exceeds the taxpayer's liabilities under this Article, as shown on an original monthly return, the Department shall, if requested by the taxpayer, issue to the taxpayer a credit memorandum no later than 30 days after the date of payment. The credit evidenced by the credit memorandum may be assigned by the taxpayer to a similar taxpayer under this Act, in accordance with reasonable rules to be prescribed by the Department. If no such request is made, the taxpayer may credit the excess payment against tax liability subsequently to be remitted to the Department under this Act, in accordance with reasonable rules prescribed by the Department. If the Department subsequently determines that all or any part of the credit taken was not actually due to the taxpayer, the taxpayer's discount shall be reduced, if necessary, to reflect the difference between the credit taken and that actually due, and that taxpayer shall be liable for penalties and interest on the difference.
    If a taxpayer fails to sign a return within 30 days after the proper notice and demand for signature by the Department is received by the taxpayer, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.
(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

410 ILCS 705/60-25

    (410 ILCS 705/60-25)
    Sec. 60-25. Infuser information returns. If it is deemed necessary for the administration of this Article, the Department may adopt rules that require infusers to file information returns regarding the sale of cannabis by infusers to dispensaries. The Department may require infusers to file all information returns by electronic means.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/60-30

    (410 ILCS 705/60-30)
    Sec. 60-30. Deposit of proceeds. All moneys received by the Department under this Article shall be deposited into the Cannabis Regulation Fund.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/60-35

    (410 ILCS 705/60-35)
    Sec. 60-35. Department administration and enforcement. The Department shall have full power to administer and enforce this Article, to collect all taxes, penalties, and interest due hereunder, to dispose of taxes, penalties and interest so collected in the manner hereinafter provided, and to determine all rights to credit memoranda, arising on account of the erroneous payment of tax, penalty, or interest hereunder. In the administration of, and compliance with, this Article, the Department and persons who are subject to this Article shall have the same rights, remedies, privileges, immunities, powers, and duties, and be subject to the same conditions, restrictions, limitations, penalties, and definitions of terms, and employ the same modes of procedure, as are prescribed in Sections 1, 2-40, 2a, 2b, 2i, 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g, 5i, 5j, 6, 6a, 6b, 6c, 6d, 7, 8, 9, 10, 11, 11a, 12, and 13 of the Retailers' Occupation Tax Act and all of the provisions of the Uniform Penalty and Interest Act, which are not inconsistent with this Article, as fully as if those provisions were set forth herein. For purposes of this Section, references in the Retailers' Occupation Tax Act to a "sale of tangible personal property at retail" mean the "sale of cannabis by a cultivator".
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/60-40

    (410 ILCS 705/60-40)
    Sec. 60-40. Invoices. Every sales invoice for cannabis issued by a cultivator to a cannabis business establishment shall contain the cultivator's certificate of registration number assigned under this Article, date, invoice number, purchaser's name and address, selling price, amount of cannabis, concentrate, or cannabis-infused product, and any other reasonable information as the Department may provide by rule is necessary for the administration of this Article. Cultivators shall retain the invoices for inspection by the Department.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/60-45

    (410 ILCS 705/60-45)
    Sec. 60-45. Rules. The Department may adopt rules related to the enforcement of this Article.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/Art. 65

 
    (410 ILCS 705/Art. 65 heading)
Article 65.
Cannabis Purchaser Excise Tax
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/65-1

    (410 ILCS 705/65-1)
    Sec. 65-1. Short title. This Article may be referred to as the Cannabis Purchaser Excise Tax Law.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/65-5

    (410 ILCS 705/65-5)
    Sec. 65-5. Definitions. In this Article:
    "Adjusted delta-9-tetrahydrocannabinol level" means, for a delta-9-tetrahydrocannabinol dominant product, the sum of the percentage of delta-9-tetrahydrocannabinol plus .877 multiplied by the percentage of tetrahydrocannabinolic acid.
    "Cannabis" has the meaning given to that term in Article 1 of this Act, except that it does not include cannabis that is subject to tax under the Compassionate Use of Medical Cannabis Program Act.
    "Cannabis-infused product" means beverage food, oils, ointments, tincture, topical formulation, or another product containing cannabis that is not intended to be smoked.
    "Cannabis retailer" means a dispensing organization that sells cannabis for use and not for resale.
    "Craft grower" has the meaning given to that term in Article 1 of this Act.
    "Department" means the Department of Revenue.
    "Director" means the Director of Revenue.
    "Dispensing organization" or "dispensary" has the meaning given to that term in Article 1 of this Act.
    "Person" means a natural individual, firm, partnership, association, joint stock company, joint adventure, public or private corporation, limited liability company, or a receiver, executor, trustee, guardian, or other representative appointed by order of any court.
    "Infuser organization" or "infuser" means a facility operated by an organization or business that is licensed by the Department of Agriculture to directly incorporate cannabis or cannabis concentrate into a product formulation to produce a cannabis-infused product.
    "Purchase price" means the consideration paid for a purchase of cannabis, valued in money, whether received in money or otherwise, including cash, gift cards, credits, and property and shall be determined without any deduction on account of the cost of materials used, labor or service costs, or any other expense whatsoever. However, "purchase price" does not include consideration paid for:
        (1) any charge for a payment that is not honored by a
    
financial institution;
        (2) any finance or credit charge, penalty or charge
    
for delayed payment, or discount for prompt payment; and
        (3) any amounts added to a purchaser's bill because
    
of charges made under the tax imposed by this Article, the Municipal Cannabis Retailers' Occupation Tax Law, the County Cannabis Retailers' Occupation Tax Law, the Retailers' Occupation Tax Act, the Use Tax Act, the Service Occupation Tax Act, the Service Use Tax Act, or any locally imposed occupation or use tax.
    "Purchaser" means a person who acquires cannabis for a valuable consideration.
    "Taxpayer" means a cannabis retailer who is required to collect the tax imposed under this Article.
(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

410 ILCS 705/65-10

    (410 ILCS 705/65-10)
    Sec. 65-10. Tax imposed.
    (a) Beginning January 1, 2020, a tax is imposed upon purchasers for the privilege of using cannabis at the following rates:
        (1) Any cannabis, other than a cannabis-infused
    
product, with an adjusted delta-9-tetrahydrocannabinol level at or below 35% shall be taxed at a rate of 10% of the purchase price;
        (2) Any cannabis, other than a cannabis-infused
    
product, with an adjusted delta-9-tetrahydrocannabinol level above 35% shall be taxed at a rate of 25% of the purchase price; and
        (3) A cannabis-infused product shall be taxed at a
    
rate of 20% of the purchase price.
    (b) The purchase of any product that contains any amount of cannabis or any derivative thereof is subject to the tax under subsection (a) of this Section on the full purchase price of the product.
    (c) The tax imposed under this Section is not imposed on cannabis that is subject to tax under the Compassionate Use of Medical Cannabis Program Act. The tax imposed by this Section is not imposed with respect to any transaction in interstate commerce, to the extent the transaction may not, under the Constitution and statutes of the United States, be made the subject of taxation by this State.
    (d) The tax imposed under this Article shall be in addition to all other occupation, privilege, or excise taxes imposed by the State of Illinois or by any municipal corporation or political subdivision thereof.
    (e) The tax imposed under this Article shall not be imposed on any purchase by a purchaser if the cannabis retailer is prohibited by federal or State Constitution, treaty, convention, statute, or court decision from collecting the tax from the purchaser.
(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

410 ILCS 705/65-11

    (410 ILCS 705/65-11)
    Sec. 65-11. Bundling of taxable and nontaxable items; prohibition; taxation. If a cannabis retailer sells cannabis, concentrate, or cannabis-infused products in combination or bundled with items that are not subject to tax under this Act for one price in violation of the prohibition on this activity under Section 15-70, then the tax under this Act is imposed on the purchase price of the entire bundled product.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/65-15

    (410 ILCS 705/65-15)
    Sec. 65-15. Collection of tax.
    (a) The tax imposed by this Article shall be collected from the purchaser by the cannabis retailer at the rate stated in Section 65-10 with respect to cannabis sold by the cannabis retailer to the purchaser, and shall be remitted to the Department as provided in Section 65-30. All sales to a purchaser who is not a cardholder under the Compassionate Use of Medical Cannabis Program Act are presumed subject to tax collection. Cannabis retailers shall collect the tax from purchasers by adding the tax to the amount of the purchase price received from the purchaser for selling cannabis to the purchaser. The tax imposed by this Article shall, when collected, be stated as a distinct item separate and apart from the purchase price of the cannabis.
    (b) If a cannabis retailer collects Cannabis Purchaser Excise Tax measured by a purchase price that is not subject to Cannabis Purchaser Excise Tax, or if a cannabis retailer, in collecting Cannabis Purchaser Excise Tax measured by a purchase price that is subject to tax under this Act, collects more from the purchaser than the required amount of the Cannabis Purchaser Excise Tax on the transaction, the purchaser shall have a legal right to claim a refund of that amount from the cannabis retailer. If, however, that amount is not refunded to the purchaser for any reason, the cannabis retailer is liable to pay that amount to the Department.
    (c) Any person purchasing cannabis subject to tax under this Article as to which there has been no charge made to him or her of the tax imposed by Section 65-10 shall make payment of the tax imposed by Section 65-10 in the form and manner provided by the Department not later than the 20th day of the month following the month of purchase of the cannabis.
(Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19.)

410 ILCS 705/65-20

    (410 ILCS 705/65-20)
    Sec. 65-20. Registration of cannabis retailers. Every cannabis retailer required to collect the tax under this Article shall apply to the Department for a certificate of registration under this Article. All applications for registration under this Article shall be made by electronic means in the form and manner required by the Department. For that purpose, the provisions of Section 2a of the Retailers' Occupation Tax Act are incorporated into this Article to the extent not inconsistent with this Article. In addition, no certificate of registration shall be issued under this Article unless the applicant is licensed under this Act.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/65-25

    (410 ILCS 705/65-25)
    Sec. 65-25. Tax collected as debt owed to State. Any cannabis retailer required to collect the tax imposed by this Article shall be liable to the Department for the tax, whether or not the tax has been collected by the cannabis retailer, and any such tax shall constitute a debt owed by the cannabis retailer to this State. To the extent that a cannabis retailer required to collect the tax imposed by this Act has actually collected that tax, the tax is held in trust for the benefit of the Department.
(Source: P.A. 101-27, eff. 6-25-19.)

410 ILCS 705/65-30

    (410 ILCS 705/65-30)
    Sec. 65-30. Return and payment of tax by cannabis retailer. Each cannabis retailer that is required or authorized to collect the tax imposed by this Article shall make a return to the Department, by electronic means, on or before the 20th day of each month for the preceding calendar month stating the following:
        (1) the cannabis retailer's name;
        (2) the address of the cannabis retailer's principal
    
place of business and the address of the principal place of business (if that is a different address) from which the cannabis retailer engaged in the business of selling cannabis subject to tax under this Article;
        (3) the total purchase price received by the cannabis
    
retailer for cannabis subject to tax under this Article;
        (4) the amount of tax due at each rate;
        (5) the signature of the cannabis retailer; and
        (6) any other information as the Department may
    
reasonably require.
    All returns required to be filed and payments required to be made under this Article shall be by electronic means. Cannabis retailers who demonstrate hardship in paying electronically may petition the Department to waive the electronic payment requirement.
    Any amount that is required to be shown or reported on any return or other document under this Article shall, if the amount is not a whole-dollar amount, be increased to the nearest whole-dollar amount if the fractional part of a dollar is $0.50 or more and decreased to the nearest whole-dollar amount if the fractional part of a dollar is less than $0.50. If a total amount of less than $1 is payable, refundable, or creditable, the amount shall be disregarded if it is less than $0.50 and shall be increased to $1 if it is $0.50 or more.
    The cannabis retailer making the return provided for in this Section shall also pay to the Department, in accordance with this Section, the amount of tax imposed by this Article, less a discount of 1.75%, but not to exceed $1,000 per return period, which is allowed to reimburse the cannabis retailer for the expenses incurred in keeping records, collecting tax, preparing and filing returns, remitting the tax, and supplying data to the Department upon request. No discount may be claimed by a cannabis retailer on returns not timely filed and for taxes not timely remitted. No discount may be claimed by a taxpayer for any return that is not filed electronically. No discount may be claimed by a taxpayer for any payment that is not made electronically, unless a waiver has been granted under this Section.
    Notwithstanding any other provision of this Article concerning the time within which a cannabis retailer may file a return, any such cannabis retailer who ceases to engage in the kind of business that makes the person responsible for filing returns under this Article shall file a final return under this Article with the Department within one month after discontinuing the business.
    Each cannabis retailer shall make estimated payments to the Department on or before the 7th, 15th, 22nd, and last day of the month during which tax liability to the Department is incurred. The payments shall be in an amount not less than the lower of either 22.5% of the cannabis retailer's actual tax liability for the month or 25% of the cannabis retailer's actual tax liability for the same calendar month of the preceding year. The amount of the quarter-monthly payments shall be credited against the final tax liability of the cannabis retailer's return for that month. If any such quarter-monthly payment is not paid at the time or in the amount required by this Section, then the cannabis retailer shall be liable for penalties and interest on the difference between the minimum amount due as a payment and the amount of the quarter-monthly payment actually and timely paid, except insofar as the cannabis retailer has previously made payments for that month to the Department in excess of the minimum payments previously due as provided in this Section.
    If any payment provided for in this Section exceeds the taxpayer's liabilities under this Article, as shown on an original monthly return, the Department shall, if requested by the taxpayer, issue to the taxpayer a credit memorandum no later than 30 days after the date of payment. The credit evidenced by the credit memorandum may be assigned by the taxpayer to a similar taxpayer under this Article, in accordance with reasonable rules to be prescribed by the Department. If no such request is made, the taxpayer may credit the excess payment against tax liability subsequently to be remitted to the Department under this Article, in accordance with reasonable rules prescribed by the Department. If the Department subsequently determines that all or any part of the credit taken was not actually due to the taxpayer, the taxpayer's discount shall be reduced, if necessary, to reflect the difference between the credit taken and that actually due, and that taxpayer shall be liable for penalties and interest on the difference. If a cannabis retailer fails to sign a return within 30 days after the proper notice and demand for signature by the Department is received by the cannabis retailer, the return shall be considered valid and any amount shown to be due on the return shall be deemed assessed.
(Source: P.A. 101-27, eff. 6-25-19.)