State of Illinois
90th General Assembly
Legislation

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[ Engrossed ][ Enrolled ][ Senate Amendment 001 ]

90_SB1455

      35 ILCS 105/3-10          from Ch. 120, par. 439.3-10
      35 ILCS 110/3-10          from Ch. 120, par. 439.33-10
      35 ILCS 115/3-10          from Ch. 120, par. 439.103-10
      35 ILCS 120/2-10          from Ch. 120, par. 441-10
      35 ILCS 125/1             from Ch. 5, par. 1751
      35 ILCS 125/3             from Ch. 5, par. 1753
      35 ILCS 125/10 rep.
          Amends the Use Tax Act, the  Service  Use  Tax  Act,  the
      Service Occupation Tax Act, and the Retailers' Occupation Tax
      Act.   Provides  that  the rate of the taxes imposed by those
      Acts applies to 70% of the proceeds of the sales  of  gasohol
      made  before  July  1, 2007 (now July 1, 1999) and to 100% of
      the proceeds of the  sales  thereafter.   Deletes  provisions
      limiting  the  rate  to 85% from July 1, 1997 to July 1, 1999
      for gasohol sold in the State during the 12 months  beginning
      July  1  following any calendar year for which the Department
      of Revenue has determined that the percentages  required  for
      the  tax  abatement under the Gasohol Fuels Tax Abatement Act
      have not been met.  Amends the Gasohol  Fuels  Tax  Abatement
      Act.  Changes the short title of the Act to the Gasohol Fuels
      Volume  Reporting  Act.  Provides that beginning in 1999, the
      Director of Revenue shall determine and announce by June 1 of
      each year the total gallons of alcohol used  in  blending  in
      Illinois  and  the  total gallons of taxable gasoline sold in
      Illinois during the  previous  calendar  year.   Repeals  the
      Section  containing  eligibility requirements for the gasohol
      tax abatement.  Effective immediately.
                                                    LRB9011546KDpcA
                                              LRB9011546KDpcA
 1        AN ACT in relation to gasohol, amending named Acts.
 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:
 4        Section  5.  The  Use  Tax  Act  is  amended  by changing
 5    Section 3-10 as follows:
 6        (35 ILCS 105/3-10) (from Ch. 120, par. 439.3-10)
 7        Sec. 3-10.  Rate of tax.  Unless  otherwise  provided  in
 8    this  Section,  the tax imposed by this Act is at the rate of
 9    6.25% of either the selling price or the fair  market  value,
10    if  any,  of  the  tangible  personal property.  In all cases
11    where property functionally used or consumed is the  same  as
12    the  property  that  was purchased at retail, then the tax is
13    imposed on the selling price of the property.  In  all  cases
14    where  property functionally used or consumed is a by-product
15    or waste product that  has  been  refined,  manufactured,  or
16    produced  from  property purchased at retail, then the tax is
17    imposed on the lower of the fair market value, if any, of the
18    specific property so used in this State  or  on  the  selling
19    price  of  the  property purchased at retail. For purposes of
20    this Section "fair market value" means  the  price  at  which
21    property  would  change  hands  between a willing buyer and a
22    willing seller, neither being under any compulsion to buy  or
23    sell  and  both  having  reasonable knowledge of the relevant
24    facts. The fair market value shall be established by Illinois
25    sales  by  the  taxpayer  of  the  same  property   as   that
26    functionally  used or consumed, or if there are no such sales
27    by the  taxpayer,  then  comparable  sales  or  purchases  of
28    property of like kind and character in Illinois.
29        With  respect  to  gasohol,  the  tax imposed by this Act
30    applies to 70% of the proceeds of  sales  made  on  or  after
31    January 1, 1990, and before July 1, 2007 1999, and to 100% of
                            -2-               LRB9011546KDpcA
 1    the  proceeds of sales made thereafter, except that from July
 2    1, 1997 to July 1, 1999, the rate shall be  85%  for  gasohol
 3    sold  in  this  State  during  the 12 months beginning July 1
 4    following any calendar year  for  which  the  Department  has
 5    determined  that the percentages in Section 10 of the Gasohol
 6    Fuels Tax Abatement Act have not been met.
 7        With respect to food for human consumption that is to  be
 8    consumed  off  the  premises  where  it  is  sold (other than
 9    alcoholic beverages, soft drinks,  and  food  that  has  been
10    prepared  for  immediate  consumption)  and  prescription and
11    nonprescription   medicines,   drugs,   medical   appliances,
12    modifications to a motor vehicle for the purpose of rendering
13    it usable by a disabled person, and  insulin,  urine  testing
14    materials, syringes, and needles used by diabetics, for human
15    use,  the  tax is imposed at the rate of 1%. For the purposes
16    of this Section, the term "soft drinks" means  any  complete,
17    finished,    ready-to-use,   non-alcoholic   drink,   whether
18    carbonated or not, including but not limited to  soda  water,
19    cola, fruit juice, vegetable juice, carbonated water, and all
20    other  preparations commonly known as soft drinks of whatever
21    kind or description that  are  contained  in  any  closed  or
22    sealed bottle, can, carton, or container, regardless of size.
23    "Soft  drinks"  does  not include coffee, tea, non-carbonated
24    water, infant formula, milk or milk products  as  defined  in
25    the Grade A Pasteurized Milk and Milk Products Act, or drinks
26    containing 50% or more natural fruit or vegetable juice.
27        Notwithstanding  any  other provisions of this Act, "food
28    for human consumption that is to be consumed off the premises
29    where it is sold" includes all food sold  through  a  vending
30    machine,  except  soft  drinks  and  food  products  that are
31    dispensed hot from  a  vending  machine,  regardless  of  the
32    location of the vending machine.
33        If  the  property  that  is  purchased  at  retail from a
34    retailer  is  acquired  outside  Illinois  and  used  outside
                            -3-               LRB9011546KDpcA
 1    Illinois before being brought to Illinois for use here and is
 2    taxable under this Act, the "selling price" on which the  tax
 3    is  computed  shall be reduced by an amount that represents a
 4    reasonable allowance for depreciation for the period of prior
 5    out-of-state use.
 6    (Source: P.A.  88-45;  89-359,  eff.  8-17-95;  89-420,  eff.
 7    6-1-96; 89-463, eff. 5-31-96; 89-626, eff. 8-9-96.)
 8        Section  10.  The  Service  Use  Tax  Act  is  amended by
 9    changing Section 3-10 as follows:
10        (35 ILCS 110/3-10) (from Ch. 120, par. 439.33-10)
11        Sec. 3-10.  Rate of tax.  Unless  otherwise  provided  in
12    this  Section,  the tax imposed by this Act is at the rate of
13    6.25% of the selling  price  of  tangible  personal  property
14    transferred  as  an incident to the sale of service, but, for
15    the purpose of computing this tax,  in  no  event  shall  the
16    selling  price be less than the cost price of the property to
17    the serviceman.
18        With respect to gasohol, as defined in the Use  Tax  Act,
19    the  tax  imposed  by  this Act applies to 70% of the selling
20    price of property transferred as an incident to the  sale  of
21    service  on or after January 1, 1990, and before July 1, 2007
22    1999, and to 100% of the  selling  price  thereafter,  except
23    that from July 1, 1997 to July 1, 1999, the rate shall be 85%
24    for gasohol sold in this State during the 12 months beginning
25    July  1  following any calendar year for which the Department
26    has determined that the percentages  in  Section  10  of  the
27    Gasohol Fuels Tax Abatement Act have not been met.
28        At  the  election  of  any registered serviceman made for
29    each fiscal year, sales of service  in  which  the  aggregate
30    annual  cost  price of tangible personal property transferred
31    as an incident to the sales of service is less than  35%,  or
32    75% in the case of servicemen transferring prescription drugs
                            -4-               LRB9011546KDpcA
 1    or  servicemen  engaged  in  graphic  arts production, of the
 2    aggregate annual total  gross  receipts  from  all  sales  of
 3    service,  the  tax  imposed by this Act shall be based on the
 4    serviceman's cost price of  the  tangible  personal  property
 5    transferred as an incident to the sale of those services.
 6        The  tax  shall  be  imposed  at  the  rate of 1% on food
 7    prepared for immediate consumption and  transferred  incident
 8    to  a  sale  of  service  subject  to this Act or the Service
 9    Occupation Tax Act by an entity licensed under  the  Hospital
10    Licensing  Act  or  the Nursing Home Care Act.  The tax shall
11    also be  imposed  at  the  rate  of  1%  on  food  for  human
12    consumption  that is to be consumed off the premises where it
13    is sold (other than alcoholic  beverages,  soft  drinks,  and
14    food  that has been prepared for immediate consumption and is
15    not otherwise included in this  paragraph)  and  prescription
16    and  nonprescription  medicines,  drugs,  medical appliances,
17    modifications to a motor vehicle for the purpose of rendering
18    it usable by a disabled person, and  insulin,  urine  testing
19    materials, syringes, and needles used by diabetics, for human
20    use. For the purposes of this Section, the term "soft drinks"
21    means  any  complete,  finished,  ready-to-use, non-alcoholic
22    drink, whether carbonated or not, including but  not  limited
23    to soda water, cola, fruit juice, vegetable juice, carbonated
24    water,  and  all  other  preparations  commonly known as soft
25    drinks of whatever kind or description that are contained  in
26    any  closed  or  sealed  bottle,  can,  carton, or container,
27    regardless of size.  "Soft drinks" does not  include  coffee,
28    tea,  non-carbonated  water,  infant  formula,  milk  or milk
29    products as defined in the Grade A Pasteurized Milk and  Milk
30    Products  Act, or drinks containing 50% or more natural fruit
31    or vegetable juice.
32        Notwithstanding any other provisions of this  Act,  "food
33    for human consumption that is to be consumed off the premises
34    where  it  is  sold" includes all food sold through a vending
                            -5-               LRB9011546KDpcA
 1    machine, except  soft  drinks  and  food  products  that  are
 2    dispensed  hot  from  a  vending  machine,  regardless of the
 3    location of the vending machine.
 4        If the property that is acquired  from  a  serviceman  is
 5    acquired  outside  Illinois  and used outside Illinois before
 6    being brought to Illinois for use here and is  taxable  under
 7    this  Act,  the  "selling price" on which the tax is computed
 8    shall be reduced by an amount that  represents  a  reasonable
 9    allowance   for   depreciation   for   the  period  of  prior
10    out-of-state use.
11    (Source: P.A.  88-45;  89-359,  eff.  8-17-95;  89-420,  eff.
12    6-1-96; 89-463, eff. 5-31-96; 89-626, eff. 8-9-96.)
13        Section 15.  The Service Occupation Tax Act is amended by
14    changing Section 3-10 as follows:
15        (35 ILCS 115/3-10) (from Ch. 120, par. 439.103-10)
16        Sec. 3-10. Rate of tax.   Unless  otherwise  provided  in
17    this  Section,  the tax imposed by this Act is at the rate of
18    6.25% of the "selling price", as defined in Section 2 of  the
19    Service  Use Tax Act, of the tangible personal property.  For
20    the purpose of computing this tax,  in  no  event  shall  the
21    "selling price" be less than the cost price to the serviceman
22    of  the  tangible personal property transferred.  The selling
23    price of each item of tangible personal property  transferred
24    as  an  incident  of  a  sale  of  service  may be shown as a
25    distinct and separate item on the serviceman's billing to the
26    service customer. If the selling price is not so  shown,  the
27    selling  price of the tangible personal property is deemed to
28    be 50% of the serviceman's  entire  billing  to  the  service
29    customer.   When,  however, a serviceman contracts to design,
30    develop, and produce special order  machinery  or  equipment,
31    the   tax   imposed  by  this  Act  shall  be  based  on  the
32    serviceman's cost price of  the  tangible  personal  property
                            -6-               LRB9011546KDpcA
 1    transferred incident to the completion of the contract.
 2        With  respect  to gasohol, as defined in the Use Tax Act,
 3    the tax imposed by this Act shall apply to 70%  of  the  cost
 4    price  of  property transferred as an incident to the sale of
 5    service on or after January 1, 1990, and before July 1,  2007
 6    1999,  and  to 100% of the cost price thereafter, except that
 7    from July 1, 1997 to July 1, 1999, the rate shall be 85%  for
 8    gasohol  sold  in  this  State during the 12 months beginning
 9    July 1 following any calendar year for which  the  Department
10    has  determined  that  the  percentages  in Section 10 of the
11    Gasohol Fuels Tax Abatement Act have not been met.
12        At the election of any  registered  serviceman  made  for
13    each  fiscal  year,  sales  of service in which the aggregate
14    annual cost price of tangible personal  property  transferred
15    as  an  incident to the sales of service is less than 35%, or
16    75% in the case of servicemen transferring prescription drugs
17    or servicemen engaged in  graphic  arts  production,  of  the
18    aggregate  annual  total  gross  receipts  from  all sales of
19    service, the tax imposed by this Act shall be  based  on  the
20    serviceman's  cost  price  of  the tangible personal property
21    transferred incident to the sale of those services.
22        The tax shall be imposed  at  the  rate  of  1%  on  food
23    prepared  for  immediate consumption and transferred incident
24    to a sale of service subject  to  this  Act  or  the  Service
25    Occupation  Tax  Act by an entity licensed under the Hospital
26    Licensing Act or the Nursing Home Care Act.   The  tax  shall
27    also  be  imposed  at  the  rate  of  1%  on  food  for human
28    consumption that is to be consumed off the premises where  it
29    is  sold  (other  than  alcoholic beverages, soft drinks, and
30    food that has been prepared for immediate consumption and  is
31    not  otherwise  included  in this paragraph) and prescription
32    and nonprescription  medicines,  drugs,  medical  appliances,
33    modifications to a motor vehicle for the purpose of rendering
34    it  usable  by  a disabled person, and insulin, urine testing
                            -7-               LRB9011546KDpcA
 1    materials, syringes, and needles used by diabetics, for human
 2    use.  For the  purposes  of  this  Section,  the  term  "soft
 3    drinks"   means   any   complete,   finished,   ready-to-use,
 4    non-alcoholic drink, whether carbonated or not, including but
 5    not  limited  to  soda  water,  cola,  fruit juice, vegetable
 6    juice, carbonated water, and all other preparations  commonly
 7    known as soft drinks of whatever kind or description that are
 8    contained  in any closed or sealed can, carton, or container,
 9    regardless of size.  "Soft drinks" does not  include  coffee,
10    tea,  non-carbonated  water,  infant  formula,  milk  or milk
11    products as defined in the Grade A Pasteurized Milk and  Milk
12    Products  Act, or drinks containing 50% or more natural fruit
13    or vegetable juice.
14        Notwithstanding any other provisions of this  Act,  "food
15    for human consumption that is to be consumed off the premises
16    where  it  is  sold" includes all food sold through a vending
17    machine, except  soft  drinks  and  food  products  that  are
18    dispensed  hot  from  a  vending  machine,  regardless of the
19    location of the vending machine.
20    (Source: P.A. 89-359,  eff.  8-17-95;  89-420,  eff.  6-1-96;
21    89-463, eff. 5-31-96; 89-626, eff. 8-9-96.)
22        Section 20.  The Retailers' Occupation Tax Act is amended
23    by changing Section 2-10 as follows:
24        (35 ILCS 120/2-10) (from Ch. 120, par. 441-10)
25        Sec.  2-10.  Rate  of  tax.  Unless otherwise provided in
26    this Section, the tax imposed by this Act is at the  rate  of
27    6.25%  of  gross  receipts  from  sales  of tangible personal
28    property made in the course of business.
29        With respect to gasohol, as defined in the Use  Tax  Act,
30    the tax imposed by this Act applies to 70% of the proceeds of
31    sales  made  on  or after January 1, 1990, and before July 1,
32    2007 1999,  and  to  100%  of  the  proceeds  of  sales  made
                            -8-               LRB9011546KDpcA
 1    thereafter,  except  that  from July 1, 1997 to July 1, 1999,
 2    the rate shall be 85% for gasohol sold in this  State  during
 3    the  12  months  beginning July 1 following any calendar year
 4    for which the Department has determined that the  percentages
 5    in Section 10 of the Gasohol Fuels Tax Abatement Act have not
 6    been met.
 7        With  respect to food for human consumption that is to be
 8    consumed off the  premises  where  it  is  sold  (other  than
 9    alcoholic  beverages,  soft  drinks,  and  food that has been
10    prepared for  immediate  consumption)  and  prescription  and
11    nonprescription   medicines,   drugs,   medical   appliances,
12    modifications to a motor vehicle for the purpose of rendering
13    it  usable  by  a disabled person, and insulin, urine testing
14    materials, syringes, and needles used by diabetics, for human
15    use, the tax is imposed at the rate of 1%. For  the  purposes
16    of  this  Section, the term "soft drinks" means any complete,
17    finished,   ready-to-use,   non-alcoholic   drink,    whether
18    carbonated  or  not, including but not limited to soda water,
19    cola, fruit juice, vegetable juice, carbonated water, and all
20    other preparations commonly known as soft drinks of  whatever
21    kind  or  description  that  are  contained  in any closed or
22    sealed bottle, can, carton, or container, regardless of size.
23    "Soft drinks" does not include  coffee,  tea,  non-carbonated
24    water,  infant  formula,  milk or milk products as defined in
25    the Grade A Pasteurized Milk and Milk Products Act, or drinks
26    containing 50% or more natural fruit or vegetable juice.
27        Notwithstanding any other provisions of this  Act,  "food
28    for human consumption that is to be consumed off the premises
29    where  it  is  sold" includes all food sold through a vending
30    machine, except  soft  drinks  and  food  products  that  are
31    dispensed  hot  from  a  vending  machine,  regardless of the
32    location of the vending machine.
33    (Source: P.A. 89-359,  eff.  8-17-95;  89-420,  eff.  6-1-96;
34    89-463, eff. 5-31-96; 89-626, eff. 8-9-96.)
                            -9-               LRB9011546KDpcA
 1        Section  25.  The  Gasohol  Fuels  Tax  Abatement  Act is
 2    amended by changing Sections 1 and 3 as follows:
 3        (35 ILCS 125/1) (from Ch. 5, par. 1751)
 4        Sec. 1.  Short title.  This  Act  may  be  cited  as  the
 5    Gasohol Fuels Volume Reporting Tax Abatement Act.
 6    (Source: P.A. 87-731.)
 7        (35 ILCS 125/3) (from Ch. 5, par. 1753)
 8        Sec.  3.  Determination  of  volume of gallons of alcohol
 9    and taxable gasoline compliance.
10        (a)  The Department shall determine the total gallons  of
11    alcohol  used  in blending in Illinois in a calendar year, in
12    addition to the total gallons of  taxable  gasoline  sold  in
13    Illinois in a calendar year.
14        (b)  Beginning  in 1999, the Director shall determine and
15    announce, by June 1  of  each  year,  the  total  gallons  of
16    alcohol used in blending in Illinois and the total gallons of
17    taxable   gasoline  sold  in  Illinois  during  the  previous
18    calendar  year.  Beginning  In  1997,  the   Director   shall
19    determine  and  announce,  by June 1 of each year, whether or
20    not the requirement in subsection (b) of Section 10 has  been
21    met during the previous calendar year.
22        (c)  The   Department  shall  promulgate  any  additional
23    regulations that may be necessary to verify  compliance  with
24    the requirements of this Act.
25    (Source: P.A. 89-463, eff. 5-31-96.)
26        (35 ILCS 125/10 rep.)
27        Section  50.  The  Gasohol  Fuels  Tax  Abatement  Act is
28    amended by repealing Section 10.
29        Section 99.  Effective date.  This Act takes effect  upon
30    becoming law.

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