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91_SB1639
LRB9110528DJcdC
1 AN ACT concerning tobacco settlement proceeds.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 1. Short title. This Act may be cited as the
5 Tobacco Settlement Proceeds Distribution Act.
6 Section 5. Definitions. In this Act:
7 "Annual income" means a taxpayer's adjusted gross income
8 as reported on the taxpayer's federal income tax return.
9 "Annual rebate formula" means an amount that is equal to
10 the amount certified by the Comptroller to the Department of
11 Revenue as having been deposited in the prior fiscal year
12 into the Tobacco Settlement Taxpayer Rebate Fund divided by
13 (i) the number of taxpayers without any dependent children
14 plus (ii) the number of taxpayers with one or more dependent
15 children, with each such taxpayer multiplied by either the
16 number of the taxpayer's dependent children or 1.3,
17 whichever is greater.
18 "Calculated annual rebate" means:
19 (1) For a taxpayer without any dependent children,
20 the amount of the annual rebate formula.
21 (2) For a taxpayer with one or more dependent
22 children, the amount of the annual rebate formula
23 multiplied by either the number of the taxpayer's
24 dependent children or 1.3, whichever is greater.
25 "Dependent child" means any child claimed as an exemption
26 under Section 151 of the Internal Revenue Code.
27 "Income" means adjusted gross income, properly reportable
28 for federal income tax purposes under the provisions of the
29 Internal Revenue Code.
30 "Internal Revenue Code" means the United States Internal
31 Revenue Code of 1954 or any successor law or laws relating to
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1 federal income taxes in effect for the year.
2 "Rebate" means the amount of money to be returned to each
3 taxpayer in the form of a warrant or, upon election, an
4 electronic transfer to a taxpayer based on the calculated
5 annual rebate determined by the annual rebate formula.
6 "Taxpayer" means an individual (i) who files a State
7 income tax return pursuant to the Illinois Income Tax Act,
8 regardless of whether the individual pays any State income
9 tax for the taxable year for which the return is filed, and
10 (ii) whose annual income for that taxable year is less than
11 $100,000. Individuals filing a joint return shall be counted
12 as a single taxpayer. If a person who files a State income
13 tax return is claimed as a dependent child for income tax
14 purposes by another individual, then for purposes of this
15 Act, that person shall be counted only as a dependent child
16 and not as a taxpayer.
17 "Tobacco settlement agreement" means the Master
18 Settlement Agreement in the case of People of the State of
19 Illinois v. Philip Morris, Inc. et al. (Circuit Court of Cook
20 County, Case No. 96-L13146). The term also includes any
21 settlement with or judgment against a tobacco product
22 manufacturer not participating in that Master Settlement
23 Agreement, if the settlement or judgment is in satisfaction
24 of a released claim as that term is defined in the Master
25 Settlement Agreement.
26 Section 10. Tobacco Settlement Trust Fund.
27 (a) The Tobacco Settlement Trust Fund is created as a
28 special fund in the State treasury.
29 (b) On July 1, 2000, the State Comptroller shall order
30 the State Treasurer to transfer all moneys in the Tobacco
31 Settlement Recovery Fund, including all earnings on those
32 moneys, into the Tobacco Settlement Trust Fund.
33 (c) The State Treasurer shall deposit into the Tobacco
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1 Settlement Trust Fund all moneys paid to the State pursuant
2 to a tobacco settlement agreement as well as any other moneys
3 as provided by law. All earnings on investments in the
4 Tobacco Settlement Trust Fund shall be credited to the Fund.
5 Section 15. Tobacco Settlement Taxpayer Rebate Fund.
6 (a) The Tobacco Settlement Taxpayer Rebate Fund is
7 created as a special fund in the State treasury.
8 (b) On July 1, 2001 and on every July 1 thereafter, the
9 State Comptroller shall order the State Treasurer to transfer
10 into the Tobacco Settlement Taxpayer Rebate Fund an amount
11 equal to 80% of the moneys received by the State pursuant to
12 a tobacco settlement agreement in the preceding fiscal year
13 and deposited into the Tobacco Settlement Trust Fund.
14 (c) The Department of Revenue shall establish and
15 administer a taxpayer rebate program as provided in this Act.
16 All expenditures from the Tobacco Settlement Taxpayer Rebate
17 Fund must be made in accordance with that program.
18 On July 1 of every year, the State Comptroller shall
19 certify to the Department of Revenue the balance in the
20 Tobacco Settlement Taxpayer Rebate Fund. The Department
21 shall identify all persons who filed an individual income tax
22 return in the preceding taxable year and shall calculate the
23 amount of a rebate to be paid to each such person using the
24 annual rebate formula. Persons who jointly file a tax return
25 are jointly entitled to a single rebate payment. The
26 Department shall request the State Comptroller to make all
27 such rebate payments from the moneys in the Tobacco
28 Settlement Taxpayer Rebate Fund based on the calculated
29 annual rebate. At the request of a person entitled to such a
30 rebate payment, the Comptroller may make the payment by
31 direct deposit into an account at a bank or other financial
32 institution designated by the person.
33 A person who is not a taxpayer as defined in this Act is
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1 not entitled to a payment under this Section.
2 Section 20. Tobacco Settlement Health Fund.
3 (a) The Tobacco Settlement Health Fund is created as a
4 special fund in the State treasury.
5 (b) On July 1, 2000, the State Comptroller shall order
6 the State Treasurer to transfer into the Tobacco Settlement
7 Health Fund an amount equal to 50% of the moneys received by
8 the State pursuant to a tobacco settlement agreement in the
9 preceding fiscal year and deposited into the Tobacco
10 Settlement Trust Fund but not more than $205,000,000.
11 (c) On July 1, 2001 and on every July 1 thereafter, the
12 State Comptroller shall order the State Treasurer to transfer
13 into the Tobacco Settlement Health Fund an amount equal to
14 20% of the moneys received by the State pursuant to a tobacco
15 settlement agreement in the preceding fiscal year and
16 deposited into the Tobacco Settlement Trust Fund.
17 (d) On July 1, 2001 and on every July 1 thereafter, the
18 State Comptroller shall order the State Treasurer to transfer
19 into the Tobacco Settlement Health Fund all interest income
20 generated on moneys in the Tobacco Settlement Trust Fund in
21 the preceding fiscal year.
22 (e) Expenditures from the Tobacco Settlement Health Fund
23 are subject to appropriation for purposes of public health,
24 health care, and anti-smoking programs.
25 Section 25. Disposition of Tobacco Settlement Trust
26 Fund. When the State Treasurer determines that the State will
27 no longer receive any moneys pursuant to a tobacco settlement
28 agreement, the Treasurer shall certify that fact to the
29 General Assembly. The General Assembly shall thereafter
30 determine the use of any moneys remaining in the Tobacco
31 Settlement Trust Fund.
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1 Section 95. The State Finance Act is amended by adding
2 Sections 5.541, 5.542, and 5.543 as follows:
3 (30 ILCS 105/5.541 new)
4 Sec. 5.541. The Tobacco Settlement Trust Fund.
5 (30 ILCS 105/5.542 new)
6 Sec. 5.542. The Tobacco Settlement Taxpayer Rebate Fund.
7 (30 ILCS 105/5.543 new)
8 Sec. 5.543. The Tobacco Settlement Health Fund.
9 (30 ILCS 105/5.540 rep.)
10 (30 ILCS 105/6z-43 rep.)
11 Section 96. The State Finance Act is amended by
12 repealing Sections 5.540 and 6z-43 as added by Public Act
13 91-646.
14 Section 97. The Cigarette Tax Act is amended by
15 changing Section 2 as follows:
16 (35 ILCS 130/2) (from Ch. 120, par. 453.2)
17 Sec. 2. Tax imposed; rate; collection, payment, and
18 distribution; discount.
19 (a) A tax is imposed upon any person engaged in business
20 as a retailer of cigarettes in this State at the rate of 5
21 1/2 mills per cigarette sold, or otherwise disposed of in the
22 course of such business in this State. In addition to any
23 other tax imposed by this Act, a tax is imposed upon any
24 person engaged in business as a retailer of cigarettes in
25 this State at a rate of 1/2 mill per cigarette sold or
26 otherwise disposed of in the course of such business in this
27 State on and after January 1, 1947, and shall be paid into
28 the Metropolitan Fair and Exposition Authority Reconstruction
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1 Fund. On and after December 1, 1985, in addition to any other
2 tax imposed by this Act, a tax is imposed upon any person
3 engaged in business as a retailer of cigarettes in this State
4 at a rate of 4 mills per cigarette sold or otherwise disposed
5 of in the course of such business in this State. Of the
6 additional tax imposed by this amendatory Act of 1985,
7 $9,000,000 of the moneys received by the Department of
8 Revenue pursuant to this Act shall be paid each month into
9 the Common School Fund. On and after the effective date of
10 this amendatory Act of 1989, in addition to any other tax
11 imposed by this Act, a tax is imposed upon any person engaged
12 in business as a retailer of cigarettes at the rate of 5
13 mills per cigarette sold or otherwise disposed of in the
14 course of such business in this State. On and after the
15 effective date of this amendatory Act of 1993, in addition to
16 any other tax imposed by this Act, a tax is imposed upon any
17 person engaged in business as a retailer of cigarettes at the
18 rate of 7 mills per cigarette sold or otherwise disposed of
19 in the course of such business in this State. On and after
20 December 15, 1997, in addition to any other tax imposed by
21 this Act, a tax is imposed upon any person engaged in
22 business as a retailer of cigarettes at the rate of 7 mills
23 per cigarette sold or otherwise disposed of in the course of
24 such business of this State. All of the moneys received by
25 the Department of Revenue pursuant to this Act and the
26 Cigarette Use Tax Act from the additional taxes imposed by
27 this amendatory Act of 1997, shall be paid each month into
28 the Common School Fund. The payment of such taxes shall be
29 evidenced by a stamp affixed to each original package of
30 cigarettes, or an authorized substitute for such stamp
31 imprinted on each original package of such cigarettes
32 underneath the sealed transparent outside wrapper of such
33 original package, as hereinafter provided. However, such
34 taxes are not imposed upon any activity in such business in
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1 interstate commerce or otherwise, which activity may not
2 under the Constitution and statutes of the United States be
3 made the subject of taxation by this State.
4 Beginning on the effective date of this amendatory Act of
5 1998, all of the moneys received by the Department of Revenue
6 pursuant to this Act and the Cigarette Use Tax Act, other
7 than the moneys that are dedicated to the Metropolitan Fair
8 and Exposition Authority Reconstruction Fund and the Common
9 School Fund, shall be distributed each month as follows:
10 first, there shall be paid into the General Revenue Fund an
11 amount which, when added to the amount paid into the Common
12 School Fund for that month, equals $33,300,000; then, from
13 the moneys remaining, if any amounts required to be paid into
14 the General Revenue Fund in previous months remain unpaid,
15 those amounts shall be paid into the General Revenue Fund;
16 then the moneys remaining, if any, shall be paid into the
17 Long-Term Care Provider Fund. Beginning on July 1, 2001, 35%
18 of the moneys that are received pursuant to this Act and the
19 Cigarette Use Tax Act and paid into the General Revenue Fund
20 as provided in this paragraph shall be transferred from the
21 General Revenue Fund into the Tobacco Settlement Health Fund.
22 To the extent that more than $25,000,000 has been paid into
23 the General Revenue Fund and Common School Fund per month for
24 the period of July 1, 1993 through the effective date of this
25 amendatory Act of 1994 from combined receipts of the
26 Cigarette Tax Act and the Cigarette Use Tax Act,
27 notwithstanding the distribution provided in this Section,
28 the Department of Revenue is hereby directed to adjust the
29 distribution provided in this Section to increase the next
30 monthly payments to the Long Term Care Provider Fund by the
31 amount paid to the General Revenue Fund and Common School
32 Fund in excess of $25,000,000 per month and to decrease the
33 next monthly payments to the General Revenue Fund and Common
34 School Fund by that same excess amount.
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1 When any tax imposed herein terminates or has terminated,
2 distributors who have bought stamps while such tax was in
3 effect and who therefore paid such tax, but who can show, to
4 the Department's satisfaction, that they sold the cigarettes
5 to which they affixed such stamps after such tax had
6 terminated and did not recover the tax or its equivalent from
7 purchasers, shall be allowed by the Department to take credit
8 for such absorbed tax against subsequent tax stamp purchases
9 from the Department by such distributor.
10 The impact of the tax levied by this Act is imposed upon
11 the retailer and shall be prepaid or pre-collected by the
12 distributor for the purpose of convenience and facility only,
13 and the amount of the tax shall be added to the price of the
14 cigarettes sold by such distributor. Collection of the tax
15 shall be evidenced by a stamp or stamps affixed to each
16 original package of cigarettes, as hereinafter provided.
17 Each distributor shall collect the tax from the retailer
18 at or before the time of the sale, shall affix the stamps as
19 hereinafter required, and shall remit the tax collected from
20 retailers to the Department, as hereinafter provided. Any
21 distributor who fails to properly collect and pay the tax
22 imposed by this Act shall be liable for the tax. Any
23 distributor having cigarettes to which stamps have been
24 affixed in his possession for sale on the effective date of
25 this amendatory Act of 1989 shall not be required to pay the
26 additional tax imposed by this amendatory Act of 1989 on such
27 stamped cigarettes. Any distributor having cigarettes to
28 which stamps have been affixed in his or her possession for
29 sale at 12:01 a.m. on the effective date of this amendatory
30 Act of 1993, is required to pay the additional tax imposed by
31 this amendatory Act of 1993 on such stamped cigarettes. This
32 payment, less the discount provided in subsection (b), shall
33 be due when the distributor first makes a purchase of
34 cigarette tax stamps after the effective date of this
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1 amendatory Act of 1993, or on the first due date of a return
2 under this Act after the effective date of this amendatory
3 Act of 1993, whichever occurs first. Any distributor having
4 cigarettes to which stamps have been affixed in his
5 possession for sale on December 15, 1997 shall not be
6 required to pay the additional tax imposed by this amendatory
7 Act of 1997 on such stamped cigarettes.
8 The amount of the Cigarette Tax imposed by this Act shall
9 be separately stated, apart from the price of the goods, by
10 both distributors and retailers, in all advertisements, bills
11 and sales invoices.
12 (b) The distributor shall be required to collect the
13 taxes provided under paragraph (a) hereof, and, to cover the
14 costs of such collection, shall be allowed a discount during
15 any year commencing July 1st and ending the following June
16 30th in accordance with the schedule set out hereinbelow,
17 which discount shall be allowed at the time of purchase of
18 the stamps when purchase is required by this Act, or at the
19 time when the tax is remitted to the Department without the
20 purchase of stamps from the Department when that method of
21 paying the tax is required or authorized by this Act. Prior
22 to December 1, 1985, a discount equal to 1 2/3% of the amount
23 of the tax up to and including the first $700,000 paid
24 hereunder by such distributor to the Department during any
25 such year; 1 1/3% of the next $700,000 of tax or any part
26 thereof, paid hereunder by such distributor to the Department
27 during any such year; 1% of the next $700,000 of tax, or any
28 part thereof, paid hereunder by such distributor to the
29 Department during any such year, and 2/3 of 1% of the amount
30 of any additional tax paid hereunder by such distributor to
31 the Department during any such year shall apply. On and after
32 December 1, 1985, a discount equal to 1.75% of the amount of
33 the tax payable under this Act up to and including the first
34 $3,000,000 paid hereunder by such distributor to the
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1 Department during any such year and 1.5% of the amount of any
2 additional tax paid hereunder by such distributor to the
3 Department during any such year shall apply.
4 Two or more distributors that use a common means of
5 affixing revenue tax stamps or that are owned or controlled
6 by the same interests shall be treated as a single
7 distributor for the purpose of computing the discount.
8 (c) The taxes herein imposed are in addition to all
9 other occupation or privilege taxes imposed by the State of
10 Illinois, or by any political subdivision thereof, or by any
11 municipal corporation.
12 (Source: P.A. 90-548, eff. 12-4-97; 90-587, eff. 7-1-98.)
13 Section 99. Effective date. This Act takes effect on
14 July 1, 2000.