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92_SB0088enr
SB88 Enrolled LRB9202600SMdv
1 AN ACT concerning telecommunications.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 ARTICLE 5
5 Section 5-1. Short title. This Act may be cited as the
6 Simplified Municipal Telecommunications Tax Act.
7 Section 5-5. Legislative intent. The General Assembly has
8 authorized the corporate authorities of any municipality to
9 impose various fees and taxes on the privilege of originating
10 or receiving telecommunications, and on retailers engaged in
11 the business of transmitting such telecommunications, all of
12 which are remitted by such retailers directly to the imposing
13 municipality. To simplify the imposition and collection of
14 municipal telecommunications taxes and to reduce complication
15 and burden, the General Assembly is repealing the municipal
16 telecommunications tax, the municipal tax on the occupation
17 or privilege of transmitting messages, and the municipal
18 infrastructure maintenance fee, and is enacting this
19 Simplified Municipal Telecommunications Tax Act which
20 provides for a single municipally imposed telecommunications
21 tax which, for municipalities with populations of less than
22 500,000, will be collected by the Illinois Department of
23 Revenue, but which, for municipalities of 500,000 or more,
24 will continue to be collected by such municipalities.
25 Section 5-7. Definitions. For purposes of the taxes
26 authorized by this Act:
27 "Amount paid" means the amount charged to the taxpayer's
28 service address in such municipality regardless of where such
29 amount is billed or paid.
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1 "Department" means the Illinois Department of Revenue.
2 "Gross charge" means the amount paid for the act or
3 privilege of originating or receiving telecommunications in
4 such municipality and for all services and equipment provided
5 in connection therewith by a retailer, valued in money
6 whether paid in money or otherwise, including cash, credits,
7 services and property of every kind or nature, and shall be
8 determined without any deduction on account of the cost of
9 such telecommunications, the cost of the materials used,
10 labor or service costs or any other expense whatsoever. In
11 case credit is extended, the amount thereof shall be included
12 only as and when paid. "Gross charges" for private line
13 service shall include charges imposed at each channel point
14 within this State, charges for the channel mileage between
15 each channel point within this State, and charges for that
16 portion of the interstate inter-office channel provided
17 within Illinois. However, "gross charge" shall not include:
18 (1) any amounts added to a purchaser's bill because
19 of a charge made pursuant to: (i) the tax imposed by this
20 Act, (ii) the tax imposed by the Telecommunications
21 Excise Tax Act, (iii) the tax imposed by Section 4251 of
22 the Internal Revenue Code, (iv) 911 surcharges, or (v)
23 charges added to customers' bills pursuant to the
24 provisions of Section 9-221 or 9-222 of the Public
25 Utilities Act, as amended, or any similar charges added
26 to customers' bills by retailers who are not subject to
27 rate regulation by the Illinois Commerce Commission for
28 the purpose of recovering any of the tax liabilities or
29 other amounts specified in those provisions of the Public
30 Utilities Act;
31 (2) charges for a sent collect telecommunication
32 received outside of such municipality;
33 (3) charges for leased time on equipment or charges
34 for the storage of data or information for subsequent
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1 retrieval or the processing of data or information
2 intended to change its form or content. Such equipment
3 includes, but is not limited to, the use of calculators,
4 computers, data processing equipment, tabulating
5 equipment or accounting equipment and also includes the
6 usage of computers under a time-sharing agreement;
7 (4) charges for customer equipment, including such
8 equipment that is leased or rented by the customer from
9 any source, wherein such charges are disaggregated and
10 separately identified from other charges;
11 (5) charges to business enterprises certified as
12 exempt under Section 9-222.1 of the Public Utilities Act
13 to the extent of such exemption and during the period of
14 time specified by the Department of Commerce and
15 Community Affairs;
16 (6) charges for telecommunications and all services
17 and equipment provided in connection therewith between a
18 parent corporation and its wholly owned subsidiaries or
19 between wholly owned subsidiaries when the tax imposed
20 under this Act has already been paid to a retailer and
21 only to the extent that the charges between the parent
22 corporation and wholly owned subsidiaries or between
23 wholly owned subsidiaries represent expense allocation
24 between the corporations and not the generation of profit
25 for the corporation rendering such service;
26 (7) bad debts ("bad debt" means any portion of a
27 debt that is related to a sale at retail for which gross
28 charges are not otherwise deductible or excludable that
29 has become worthless or uncollectible, as determined
30 under applicable federal income tax standards; if the
31 portion of the debt deemed to be bad is subsequently
32 paid, the retailer shall report and pay the tax on that
33 portion during the reporting period in which the payment
34 is made);
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1 (8) charges paid by inserting coins in
2 coin-operated telecommunication devices; or
3 (9) amounts paid by telecommunications retailers
4 under the Telecommunications Infrastructure Maintenance
5 Fee Act.
6 "Interstate telecommunications" means all
7 telecommunications that either originate or terminate outside
8 this State.
9 "Intrastate telecommunications" means all
10 telecommunications that originate and terminate within this
11 State.
12 "Person" means any natural individual, firm, trust,
13 estate, partnership, association, joint stock company, joint
14 venture, corporation, limited liability company, or a
15 receiver, trustee, guardian, or other representative
16 appointed by order of any court, the Federal and State
17 governments, including State universities created by statute,
18 or any city, town, county, or other political subdivision of
19 this State.
20 "Purchase at retail" means the acquisition, consumption
21 or use of telecommunications through a sale at retail.
22 "Retailer" means and includes every person engaged in the
23 business of making sales at retail as defined in this
24 Section. The Department may, in its discretion, upon
25 application, authorize the collection of the tax hereby
26 imposed by any retailer not maintaining a place of business
27 within this State, who, to the satisfaction of the
28 Department, furnishes adequate security to insure collection
29 and payment of the tax. Such retailer shall be issued,
30 without charge, a permit to collect such tax. When so
31 authorized, it shall be the duty of such retailer to collect
32 the tax upon all of the gross charges for telecommunications
33 in this State in the same manner and subject to the same
34 requirements as a retailer maintaining a place of business
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1 within this State. The permit may be revoked by the
2 Department at its discretion.
3 "Retailer maintaining a place of business in this State",
4 or any like term, means and includes any retailer having or
5 maintaining within this State, directly or by a subsidiary,
6 an office, distribution facilities, transmission facilities,
7 sales office, warehouse or other place of business, or any
8 agent or other representative operating within this State
9 under the authority of the retailer or its subsidiary,
10 irrespective of whether such place of business or agent or
11 other representative is located here permanently or
12 temporarily, or whether such retailer or subsidiary is
13 licensed to do business in this State.
14 "Sale at retail" means the transmitting, supplying or
15 furnishing of telecommunications and all services and
16 equipment provided in connection therewith for a
17 consideration, to persons other than the Federal and State
18 governments, and State universities created by statute and
19 other than between a parent corporation and its wholly owned
20 subsidiaries or between wholly owned subsidiaries for their
21 use or consumption and not for resale.
22 "Service address" means the location of
23 telecommunications equipment from which telecommunications
24 services are originated or at which telecommunications
25 services are received by a taxpayer. In the event this may
26 not be a defined location, as in the case of mobile phones,
27 paging systems, and maritime systems, service address means
28 the customer's place of primary use as defined in the Mobile
29 Telecommunications Sourcing Conformity Act. For
30 air-to-ground systems and the like, "service address" shall
31 mean the location of a taxpayer's primary use of the
32 telecommunications equipment as defined by telephone number,
33 authorization code, or location in Illinois where bills are
34 sent.
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1 "Taxpayer" means a person who individually or through his
2 or her agents, employees, or permittees engages in the act or
3 privilege of originating or receiving telecommunications in a
4 municipality and who incurs a tax liability as authorized by
5 this Act.
6 "Telecommunications", in addition to the meaning
7 ordinarily and popularly ascribed to it, includes, without
8 limitation, messages or information transmitted through use
9 of local, toll, and wide area telephone service, private line
10 services, channel services, telegraph services,
11 teletypewriter, computer exchange services, cellular mobile
12 telecommunications service, specialized mobile radio,
13 stationary two-way radio, paging service, or any other form
14 of mobile and portable one-way or two-way communications, or
15 any other transmission of messages or information by
16 electronic or similar means, between or among points by wire,
17 cable, fiber optics, laser, microwave, radio, satellite, or
18 similar facilities. As used in this Act, "private line"
19 means a dedicated non-traffic sensitive service for a single
20 customer, that entitles the customer to exclusive or priority
21 use of a communications channel or group of channels, from
22 one or more specified locations to one or more other
23 specified locations. The definition of "telecommunications"
24 shall not include value added services in which computer
25 processing applications are used to act on the form, content,
26 code, and protocol of the information for purposes other than
27 transmission. "Telecommunications" shall not include
28 purchases of telecommunications by a telecommunications
29 service provider for use as a component part of the service
30 provided by such provider to the ultimate retail consumer who
31 originates or terminates the taxable end-to-end
32 communications. Carrier access charges, right of access
33 charges, charges for use of inter-company facilities, and all
34 telecommunications resold in the subsequent provision of,
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1 used as a component of, or integrated into, end-to-end
2 telecommunications service shall be non-taxable as sales for
3 resale. Prepaid telephone calling arrangements shall not be
4 considered "telecommunications" subject to the tax imposed
5 under this Act. For purposes of this Section, "prepaid
6 telephone calling arrangements" means that term as defined in
7 Section 2-27 of the Retailers' Occupations Tax Act.
8 Section 5-10. Authority. The corporate authorities of
9 any municipality in this State may tax any and all of the
10 following acts or privileges:
11 (a) The act or privilege of originating in such
12 municipality or receiving in such municipality intrastate
13 telecommunications by a person. However, such tax is not
14 imposed on such act or privilege to the extent such act or
15 privilege may not, under the Constitution and statutes of the
16 United States, be made the subject of taxation by
17 municipalities in this State.
18 (b) The act or privilege of originating in such
19 municipality or receiving in such municipality interstate
20 telecommunications by a person. To prevent actual multi-state
21 taxation of the act or privilege that is subject to taxation
22 under this subsection, any taxpayer, upon proof that the
23 taxpayer has paid a tax in another state on such event, shall
24 be allowed a credit against any tax enacted pursuant to or
25 authorized by this Section to the extent of the amount of
26 such tax properly due and paid in such other state which was
27 not previously allowed as a credit against any other state or
28 local tax in this State. However, such tax is not imposed on
29 the act or privilege to the extent such act or privilege may
30 not, under the Constitution and statutes of the United
31 States, be made the subject of taxation by municipalities in
32 this State.
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1 Section 5-15. Maximum rates.
2 (a) For municipalities with a population of less than
3 500,000, the tax authorized by this Act may be imposed at a
4 rate not to exceed 6% of the gross charge for
5 telecommunications purchased at retail. If imposed, the tax
6 must be in increments of 0.25%.
7 (b) For municipalities with a population of 500,000 or
8 more, the tax authorized by this Act may be imposed at a rate
9 not to exceed 7% of the gross charge for telecommunications
10 purchased at retail. If imposed, the tax must be in
11 increments of 0.25%.
12 Section 5-20. Imposition.
13 (a) On and after January 1, 2003, for municipalities
14 with populations of less than 500,000, the tax authorized by
15 this Act shall be imposed (except as provided in Sections
16 5-25 and 5-30 of this Act), amended, or repealed by an
17 ordinance adopted by the municipality, which ordinance shall
18 be filed by the municipality with the Department pursuant to
19 the rules of the Department.
20 (1) Any ordinance adopted by a municipality with a
21 population of less than 500,000 which attempts to impose,
22 amend or repeal the tax authorized by this Act shall be
23 of no force and effect until properly filed with an
24 appropriate form with the Department.
25 (2) Any certified copy of an ordinance filed with
26 the Department prior to October 1, 2002 shall be
27 effective with respect to gross charges billed by
28 telecommunications retailers on or after January 1, 2003
29 and thereafter any certified copy of an ordinance filed
30 with the Department prior to any April 1 or October 1
31 shall be effective with respect to gross charges billed
32 by telecommunications retailers on or after the following
33 July 1 or January 1, respectively.
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1 (b) On and after January 1, 2003, for municipalities
2 with populations of 500,000 or more, the tax authorized by
3 this Act shall be imposed, amended, or repealed, and any
4 authorized exemptions granted, by the adoption of an
5 ordinance.
6 Section 5-25. Existing telecommunications taxes and
7 fees.
8 (a) Between July 1, 2002 and August 1, 2002, the
9 Department shall publish a list of the municipalities with a
10 population of less than 500,000 that have, at any time before
11 the effective date of this Act, enacted ordinances imposing
12 any taxes or fees authorized by subparagraph 1 of Section
13 8-11-2 of the Illinois Municipal Code, Section 8-11-17 of the
14 Illinois Municipal Code, or Section 20 of the
15 Telecommunications Infrastructure Maintenance Fee Act. Such
16 list shall include the name of each such municipality, the
17 rates at which such taxes or fees are imposed as of the
18 effective date of this Act, and the rate of the new
19 Simplified Municipal Telecommunications Tax, as calculated
20 pursuant to Section 5-30 of this Act.
21 (b) In compiling the list described in this Section, the
22 Department shall collect information from retailers,
23 municipalities, the Illinois Commerce Commission, and other
24 sources deemed by the Department to be reliable.
25 (c) Any municipality appearing on the list published
26 pursuant to this Section shall not be required to adopt and
27 file an ordinance implementing the tax authorized by this
28 Act. The list shall be conclusive evidence of the imposition
29 of the tax authorized by this Act at the rate appearing on
30 such list. Any tax imposed in such manner shall take effect
31 with respect to gross charges billed by telecommunications
32 retailers on or after January 1, 2003. A municipality may
33 alter such tax only by filing an ordinance with the
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1 Department pursuant to Section 5-20 of this Act.
2 Section 5-30. Calculation of rates for certain
3 municipalities. The rate of the Simplified Municipal
4 Telecommunications Tax for municipalities on the list
5 described in Section 5-25 of this Act shall be measured by
6 the sum of the following rates set forth in ordinances
7 enacted by the municipalities at the rates in effect on the
8 effective date of this Act:
9 (1) The rate equal to 70% of the rate set forth in
10 such ordinance pursuant to subparagraph 1 of Section
11 8-11-2 of the Illinois Municipal Code, rounded to the
12 nearest even 0.25% increment; plus
13 (2) The rate set forth in such ordinance pursuant
14 to Section 8-11-17 of the Illinois Municipal Code,
15 rounded to the nearest even 0.25% increment; plus
16 (3) The rate set forth in such ordinance pursuant
17 to Section 20 of the Telecommunications Infrastructure
18 Maintenance Fee Act.
19 Section 5-35. Rebates and exemptions. Any municipality
20 may implement the following rebates and exemptions:
21 (1) A municipality that imposes the tax authorized
22 by this Act and whose territory includes part of another
23 unit of local government or a school district, may, by
24 separate ordinance, rebate some or all of the amount of
25 such tax paid by the other unit of local government or
26 school district. Any such rebate shall be paid by the
27 municipality directly to the other unit of local
28 government or school district qualifying for the rebate
29 as determined by the municipality's ordinance, which
30 shall not be filed with the Department.
31 (2) A municipality that imposes the tax authorized
32 by this Act may, by separate ordinance, rebate some or
SB88 Enrolled -11- LRB9202600SMdv
1 all of the amount of such tax to persons 65 years of age
2 or older. Any tax related to such rebate shall be
3 rebated from the municipality directly to persons
4 qualified for the rebate as determined by the
5 municipality's ordinance, which shall not be filed with
6 the Department.
7 (3) A municipality with a population of 500,000 or
8 more that imposes the tax authorized by this Act may, by
9 separate ordinance, exempt from the tax authorized by
10 this Act, charges for inbound toll-free
11 telecommunications service commonly known as "800",
12 "877", or "888" or for a similar service, to the extent
13 such municipality has passed an ordinance providing for
14 this exemption.
15 Section 5-40. Collection.
16 (a) For municipalities with populations of less than
17 500,000, the tax authorized by this Act shall be collected
18 from the taxpayer by a retailer maintaining a place of
19 business in this State and shall be remitted by such retailer
20 to the Department. Any tax required to be collected pursuant
21 to or as authorized by this Act and any such tax collected by
22 such retailer and required to be remitted to the Department
23 shall constitute a debt owed by the retailer to the State.
24 Retailers shall collect the tax from the taxpayer by adding
25 the tax to the gross charge for the act or privilege of
26 originating or receiving telecommunications when sold for
27 use, in the manner prescribed by the Department. The tax
28 authorized by this Act shall constitute a debt of the
29 taxpayer to the retailer until paid, and, if unpaid, is
30 recoverable at law in the same manner as the original charge
31 for such sale at retail. If the retailer fails to collect
32 the tax from the taxpayer, then the taxpayer shall be
33 required to pay the tax directly to the Department in the
SB88 Enrolled -12- LRB9202600SMdv
1 manner provided by the Department.
2 (b) For municipalities with populations of 500,000 or
3 more, the tax authorized by this Act shall be collected from
4 the taxpayer by a retailer making or effectuating the sale at
5 retail and shall be remitted by such retailer to such
6 municipality. Any tax required to be collected pursuant to
7 an ordinance authorized by this Act and any such tax
8 collected by a retailer shall constitute a debt owed by the
9 retailer to such municipality. Retailers shall collect the
10 tax from the taxpayer by adding the tax to the gross charge
11 for the act or privilege of originating or receiving
12 telecommunications when sold for use, in the manner
13 prescribed by such municipality. The tax authorized by this
14 Act shall constitute a debt of the taxpayer to the retailer
15 who made or effectuated the sale at retail until paid and, if
16 unpaid, is recoverable at law in the same manner as the
17 original charge for the sale at retail. If the retailer
18 fails to collect the tax from the taxpayer, then the taxpayer
19 shall be required to pay the tax directly to such
20 municipality in the manner provided by such municipality.
21 The municipality imposing the tax shall provide for its
22 administration and enforcement.
23 (c) Retailers filing tax returns pursuant to this Act
24 shall, at the time of filing such return, pay to a
25 municipality with a population of 500,000 or more or to the
26 Department for all other municipalities, the amount of the
27 tax collected, less a discount of 1% which is allowed to
28 reimburse the retailer for the expenses incurred in keeping
29 records, billing the customer, preparing and filing returns,
30 remitting the tax and supplying data to a municipality or the
31 Department upon request. No discount may be claimed by a
32 retailer on returns not timely filed and for taxes not timely
33 remitted.
34 (d) Whenever possible, the tax authorized by this Act
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1 shall, when collected, be stated as a distinct item separate
2 and apart from the gross charge for telecommunications.
3 Section 5-45. Resellers.
4 (a) If a person who originates or receives
5 telecommunications claims to be a reseller of such
6 telecommunications, such person shall apply to a municipality
7 with a population of 500,000 or more or to the Department for
8 all other municipalities, for a resale number. Such
9 applicant shall state facts which will show a municipality
10 with a population of 500,000 or more or the Department for
11 all other municipalities, why such applicant is not liable
12 for tax authorized by this Act on any of such purchases and
13 shall furnish such additional information as a municipality
14 with a population of 500,000 or more or the Department for
15 all other municipalities, may reasonably require.
16 (b) Upon approval of the application, a municipality
17 with a population of 500,000 or more or the Department for
18 all other municipalities, shall assign a resale number to the
19 applicant and shall certify such number to the applicant. A
20 municipality with a population of 500,000 or more or the
21 Department for all other municipalities, may cancel any
22 number which is obtained through misrepresentation, or which
23 is used to send or receive such telecommunication tax-free
24 when such actions in fact are not for resale, or which no
25 longer applies because of the person's having discontinued
26 the making of resales.
27 (c) Except as provided hereinabove in this Section, the
28 act or privilege of originating or receiving
29 telecommunications in this State shall not be made tax-free
30 on the ground of being a sale for resale unless the person
31 has an active resale number from a municipality with a
32 population of 500,000 or more or the Department for all other
33 municipalities, and furnishes that number to the retailer in
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1 connection with certifying to the retailer that any sale to
2 such person is non-taxable because of being a sale for
3 resale.
4 Section 5-50. Returns to the Department.
5 (a) Commencing on February 1, 2003, for the tax imposed
6 under subsection (a) of Section 5-20 of this Act, every
7 retailer maintaining a place of business in this State shall,
8 on or before the last day of each month make a return to the
9 Department for the preceding calendar month, stating:
10 (1) Its name;
11 (2) The address of its principal place of business
12 or the address of the principal place of business (if
13 that is a different address) from which it engages in the
14 business of transmitting telecommunications;
15 (3) Total amount of gross charges billed by it
16 during the preceding calendar month for providing
17 telecommunications during the calendar month;
18 (4) Total amount received by it during the
19 preceding calendar month on credit extended;
20 (5) Deductions allowed by law;
21 (6) Gross charges that were billed by it during the
22 preceding calendar month and upon the basis of which the
23 tax is imposed;
24 (7) Amount of tax (computed upon Item 6);
25 (8) The municipalities to which the Department
26 shall remit the taxes and the amount of such remittances;
27 (9) Such other reasonable information as the
28 Department may require.
29 (b) Any retailer required to make payments under this
30 Section may make the payments by electronic funds transfer.
31 The Department shall adopt rules necessary to effectuate a
32 program of electronic funds transfer. Any retailer who has
33 average monthly tax billings due to the Department under this
SB88 Enrolled -15- LRB9202600SMdv
1 Act and the Telecommunications Excise Tax Act that exceed
2 $1,000 shall make all payments by electronic funds transfer
3 as required by rules of the Department.
4 (c) If the retailer's average monthly tax billings due
5 to the Department under this Act and the Telecommunications
6 Excise Tax Act do not exceed $1,000, the Department may
7 authorize such retailer's returns to be filed on a
8 quarter-annual basis, with the return for January, February,
9 and March of a given year being due by April 30th of that
10 year; with the return for April, May, and June of a given
11 year being due by July 31st of that year; with the return for
12 July, August, and September of a given year being due by
13 October 31st of that year; and with the return for October,
14 November, and December of a given year being due by January
15 31st of the following year.
16 (d) If the retailer is otherwise required to file a
17 monthly or quarterly return and if the retailer's average
18 monthly tax billings due to the Department under this Act and
19 the Telecommunications Excise Tax Act do not exceed $400, the
20 Department may authorize such retailer's return to be filed
21 on an annual basis, with the return for a given year being
22 due by January 31st of the following year.
23 (e) Each retailer whose average monthly remittance to
24 the Department under this Act and the Telecommunications
25 Excise Tax Act was $25,000 or more during the preceding
26 calendar year, excluding the month of highest remittance and
27 the month of lowest remittance in such calendar year, and who
28 is not operated by a unit of local government, shall make
29 estimated payments to the Department on or before the 7th,
30 15th, 22nd, and last day of the month during which the tax
31 remittance is owed to the Department in an amount not less
32 than the lower of either 22.5% of the retailer's actual tax
33 collections for the month or 25% of the retailer's actual tax
34 collections for the same calendar month of the preceding
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1 year. The amount of such quarter-monthly payments shall be
2 credited against the final remittance of the retailer's
3 return for that month. Any outstanding credit, approved by
4 the Department, arising from the retailer's overpayment of
5 its final remittance for any month may be applied to reduce
6 the amount of any subsequent quarter-monthly payment or
7 credited against the final remittance of the retailer's
8 return for any subsequent month. If any quarter-monthly
9 payment is not paid at the time or in the amount required by
10 this Section, the retailer shall be liable for penalty and
11 interest on the difference between the minimum amount due as
12 a payment and the amount of such payment actually and timely
13 paid, except insofar as the retailer has previously made
14 payments for that month to the Department or received credits
15 in excess of the minimum payments previously due.
16 (f) Notwithstanding any other provision of this Section
17 containing the time within which a retailer may file his or
18 her return, in the case of any retailer who ceases to engage
19 in a kind of business that makes him or her responsible for
20 filing returns under this Section, the retailer shall file a
21 final return under this Section with the Department not more
22 than one month after discontinuing such business.
23 (g) In making such return, the retailer shall determine
24 the value of any consideration other than money received by
25 it and such retailer shall include the value in its return.
26 Such determination shall be subject to review and revision by
27 the Department in the manner hereinafter provided for the
28 correction of returns.
29 (h) Any retailer who has average monthly tax billings
30 due to the Department under this Act and the
31 Telecommunications Excise Tax Act that exceed $1,000 shall
32 file the return required by this Section by electronic means
33 as required by rules of the Department.
34 (i) The retailer filing the return herein provided for
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1 shall, at the time of filing the return, pay to the
2 Department the amounts due pursuant to this Act. The
3 Department shall immediately pay over to the State Treasurer,
4 ex officio, as trustee, 99.5% of all taxes, penalties, and
5 interest collected hereunder for deposit into the Municipal
6 Telecommunications Fund, which is hereby created. The
7 remaining 0.5% received by the Department pursuant to this
8 Act shall be deposited into the Tax Compliance and
9 Administration Fund and shall be used by the Department,
10 subject to appropriation, to cover the costs of the
11 Department. On or before the 25th day of each calendar month,
12 the Department shall prepare and certify to the Comptroller
13 the disbursement of stated sums of money to be paid to named
14 municipalities from the Municipal Telecommunications Fund for
15 amounts collected during the second preceding calendar month.
16 The named municipalities shall be those municipalities
17 identified by a retailer in such retailer's return as having
18 imposed the tax authorized by the Act. The amount of money
19 to be paid to each municipality shall be the amount (not
20 including credit memoranda) collected hereunder during the
21 second preceding calendar month by the Department, plus an
22 amount the Department determines is necessary to offset any
23 amounts that were erronenously paid to a different taxing
24 body, and not including an amount equal to the amount of
25 refunds made during the second preceding calendar month by
26 the Department on behalf of such municipality, and not
27 including any amount that the Department determines is
28 necessary to offset any amount that were payable to a
29 different taxing body but were erroneously paid to the
30 municipality. Within 10 days after receipt by the
31 Comptroller of the disbursement certification from the
32 Department, the Comptroller shall cause the orders to be
33 drawn for the respective amounts in accordance with the
34 directions contained in the certification. When certifying
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1 to the Comptroller the amount of a monthly disbursement to a
2 municipality under this Section, the Department shall
3 increase or decrease the amount by an amount necessary to
4 offset any misallocation of previous disbursements. The
5 offset amount shall be the amount erroneously disbursed
6 within the previous 6 months from the time a misallocation is
7 discovered.
8 (j) For municipalities with populations of less than
9 500,000, whenever the Department determines that a refund
10 shall be made under this Section to a claimant instead of
11 issuing a credit memorandum, the Department shall notify the
12 State Comptroller, who shall cause the order to be drawn for
13 the amount specified and to the person named in the
14 notification from the Department. The refund shall be paid
15 by the State Treasurer out of the Municipal
16 Telecommunications Fund.
17 Section 5-55. Pledged revenues. If a municipality has,
18 by contract, pledged or dedicated any or all of the revenues
19 collected under any of its taxes imposed pursuant to
20 subparagraph 1 of Section 8-11-2 of the Illinois Municipal
21 Code, Section 8-11-17 of the Illinois Municipal Code, or
22 Section 20 of the Telecommunications Infrastructure
23 Maintenance Fee Act as shown on the list described in Section
24 5-25 of this Act, then the equivalent portion of revenues
25 collected from the tax authorized by this Act shall be deemed
26 pledged or dedicated in a manner substantially similar to the
27 pledge of the then existing taxes so as to prevent disruption
28 of such contract.
29 Section 5-60. Waiver of franchise fees.
30 (a) Any municipality shall be deemed to have waived its
31 right to receive all fees, charges and other compensation
32 that might accrue to the municipality after the effective
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1 date of this Act, under any franchise agreement, license, or
2 similar agreement, executed on or before January 1, 1998 with
3 telecommunications retailers if:
4 (1) the municipality imposes the tax authorized by
5 this Act at a rate exceeding 5%;
6 (2) the municipality affirmatively waives such
7 fees; or
8 (3) the municipality is included in the list
9 described in Section 5-25 of this Act as having an
10 infrastructure maintenance fee in place.
11 (b) This waiver shall be effective only during the time
12 that either the infrastructure maintenance fee or the
13 simplified tax authorized under this Act is subject to being
14 lawfully imposed on the telecommunications retailer,
15 collected by the municipality or the Department, and paid
16 over to the municipality.
17 (c) No portion of this Act shall be construed to have
18 repealed or amended the prohibition on franchise fees or
19 other charges set forth in Section 30 of the
20 Telecommunications Infrastructure Maintenance Fee Act.
21 Section 5-65. Incorporation by reference. On and after
22 January 1, 2003, for municipalities with populations of less
23 than 500,000, all of the provisions of Sections 7, 10, 11,
24 12, 13, 14, 15, 16, 17, 18, and 19 of the Telecommunications
25 Excise Tax Act, Sections 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g,
26 5i, 5j, 6, 6a, 6b, and 6c of the Retailers' Occupation Tax
27 Act, and all the provisions of the Uniform Penalty and
28 Interest Act, which are not inconsistent with this Act, shall
29 apply, as far as practicable, to the subject matter of this
30 Act to the same extent as if such provisions were included
31 herein. References in such incorporated Sections of the
32 Retailers' Occupation Tax Act to retailers, to sellers, or to
33 persons engaged in the business of selling tangible personal
SB88 Enrolled -20- LRB9202600SMdv
1 property mean retailers, as defined in this Act, or persons
2 engaged in the act or privilege of originating or receiving
3 telecommunications. References in such incorporated Sections
4 of the Retailers' Occupation Tax Act to purchasers of
5 tangible personal property mean purchasers of
6 telecommunications as defined in this Act. References in
7 such incorporated Sections of the Retailers' Occupation Tax
8 Act to sales of tangible personal property mean the act or
9 privilege of originating or receiving telecommunications as
10 defined in this Act.
11 Section 5-90. Home rule. The authorization to impose
12 municipal telecommunications taxes and fees is an exclusive
13 power and function of the State. A home rule municipality
14 may not impose municipal telecommunications taxes and fees
15 other than as authorized under this Act. This Act is a
16 denial and limitation of municipal home rule powers and
17 functions under subsection (g) of Section 6 of Article VII of
18 the Illinois Constitution.
19 ARTICLE 90
20 Section 90-5. The State Revenue Sharing Act is amended
21 by changing Section 12 as follows:
22 (30 ILCS 115/12) (from Ch. 85, par. 616)
23 Sec. 12. Personal Property Tax Replacement Fund. There
24 is hereby created the Personal Property Tax Replacement Fund,
25 a special fund in the State Treasury into which shall be paid
26 all revenue realized:
27 (a) all amounts realized from the additional personal
28 property tax replacement income tax imposed by subsections
29 (c) and (d) of Section 201 of the Illinois Income Tax Act,
30 except for those amounts deposited into the Income Tax Refund
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1 Fund pursuant to subsection (c) of Section 901 of the
2 Illinois Income Tax Act; and
3 (b) all amounts realized from the additional personal
4 property replacement invested capital taxes imposed by
5 Section 2a.1 of the Messages Tax Act, Section 2a.1 of the Gas
6 Revenue Tax Act, Section 2a.1 of the Public Utilities
7 Revenue Act, and Section 3 of the Water Company Invested
8 Capital Tax Act, and amounts payable to the Department of
9 Revenue under the Telecommunications Municipal Infrastructure
10 Maintenance Fee Act.
11 As soon as may be after the end of each month, the
12 Department of Revenue shall certify to the Treasurer and the
13 Comptroller the amount of all refunds paid out of the General
14 Revenue Fund through the preceding month on account of
15 overpayment of liability on taxes paid into the Personal
16 Property Tax Replacement Fund. Upon receipt of such
17 certification, the Treasurer and the Comptroller shall
18 transfer the amount so certified from the Personal Property
19 Tax Replacement Fund into the General Revenue Fund.
20 The payments of revenue into the Personal Property Tax
21 Replacement Fund shall be used exclusively for distribution
22 to taxing districts as provided in this Section, payment of
23 the expenses of the Department of Revenue incurred in
24 administering the collection and distribution of monies paid
25 into the Personal Property Tax Replacement Fund and transfers
26 due to refunds to taxpayers for overpayment of liability for
27 taxes paid into the Personal Property Tax Replacement Fund.
28 As soon as may be after the effective date of this
29 amendatory Act of 1980, the Department of Revenue shall
30 certify to the Treasurer the amount of net replacement
31 revenue paid into the General Revenue Fund prior to that
32 effective date from the additional tax imposed by Section
33 2a.1 of the Messages Tax Act; Section 2a.1 of the Gas Revenue
34 Tax Act; Section 2a.1 of the Public Utilities Revenue Act;
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1 Section 3 of the Water Company Invested Capital Tax Act;
2 amounts collected by the Department of Revenue under the
3 Telecommunications Municipal Infrastructure Maintenance Fee
4 Act; and the additional personal property tax replacement
5 income tax imposed by the Illinois Income Tax Act, as amended
6 by Public Act 81-1st Special Session-1. Net replacement
7 revenue shall be defined as the total amount paid into and
8 remaining in the General Revenue Fund as a result of those
9 Acts minus the amount outstanding and obligated from the
10 General Revenue Fund in state vouchers or warrants prior to
11 the effective date of this amendatory Act of 1980 as refunds
12 to taxpayers for overpayment of liability under those Acts.
13 All interest earned by monies accumulated in the Personal
14 Property Tax Replacement Fund shall be deposited in such
15 Fund. All amounts allocated pursuant to this Section are
16 appropriated on a continuing basis.
17 Prior to December 31, 1980, as soon as may be after the
18 end of each quarter beginning with the quarter ending
19 December 31, 1979, and on and after December 31, 1980, as
20 soon as may be after January 1, March 1, April 1, May 1, July
21 1, August 1, October 1 and December 1 of each year, the
22 Department of Revenue shall allocate to each taxing district
23 as defined in Section 1-150 of the Property Tax Code, in
24 accordance with the provisions of paragraph (2) of this
25 Section the portion of the funds held in the Personal
26 Property Tax Replacement Fund which is required to be
27 distributed, as provided in paragraph (1), for each quarter.
28 Provided, however, under no circumstances shall any taxing
29 district during each of the first two years of distribution
30 of the taxes imposed by this amendatory Act of 1979 be
31 entitled to an annual allocation which is less than the funds
32 such taxing district collected from the 1978 personal
33 property tax. Provided further that under no circumstances
34 shall any taxing district during the third year of
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1 distribution of the taxes imposed by this amendatory Act of
2 1979 receive less than 60% of the funds such taxing district
3 collected from the 1978 personal property tax. In the event
4 that the total of the allocations made as above provided for
5 all taxing districts, during either of such 3 years, exceeds
6 the amount available for distribution the allocation of each
7 taxing district shall be proportionately reduced. Except as
8 provided in Section 13 of this Act, the Department shall then
9 certify, pursuant to appropriation, such allocations to the
10 State Comptroller who shall pay over to the several taxing
11 districts the respective amounts allocated to them.
12 Any township which receives an allocation based in whole
13 or in part upon personal property taxes which it levied
14 pursuant to Section 6-507 or 6-512 of the Illinois Highway
15 Code and which was previously required to be paid over to a
16 municipality shall immediately pay over to that municipality
17 a proportionate share of the personal property replacement
18 funds which such township receives.
19 Any municipality or township, other than a municipality
20 with a population in excess of 500,000, which receives an
21 allocation based in whole or in part on personal property
22 taxes which it levied pursuant to Sections 3-1, 3-4 and 3-6
23 of the Illinois Local Library Act and which was previously
24 required to be paid over to a public library shall
25 immediately pay over to that library a proportionate share of
26 the personal property tax replacement funds which such
27 municipality or township receives; provided that if such a
28 public library has converted to a library organized under The
29 Illinois Public Library District Act, regardless of whether
30 such conversion has occurred on, after or before January 1,
31 1988, such proportionate share shall be immediately paid over
32 to the library district which maintains and operates the
33 library. However, any library that has converted prior to
34 January 1, 1988, and which hitherto has not received the
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1 personal property tax replacement funds, shall receive such
2 funds commencing on January 1, 1988.
3 Any township which receives an allocation based in whole
4 or in part on personal property taxes which it levied
5 pursuant to Section 1c of the Public Graveyards Act and which
6 taxes were previously required to be paid over to or used for
7 such public cemetery or cemeteries shall immediately pay over
8 to or use for such public cemetery or cemeteries a
9 proportionate share of the personal property tax replacement
10 funds which the township receives.
11 Any taxing district which receives an allocation based in
12 whole or in part upon personal property taxes which it levied
13 for another governmental body or school district in Cook
14 County in 1976 or for another governmental body or school
15 district in the remainder of the State in 1977 shall
16 immediately pay over to that governmental body or school
17 district the amount of personal property replacement funds
18 which such governmental body or school district would receive
19 directly under the provisions of paragraph (2) of this
20 Section, had it levied its own taxes.
21 (1) The portion of the Personal Property Tax Replacement
22 Fund required to be distributed as of the time allocation is
23 required to be made shall be the amount available in such
24 Fund as of the time allocation is required to be made.
25 The amount available for distribution shall be the total
26 amount in the fund at such time minus the necessary
27 administrative expenses as limited by the appropriation and
28 the amount determined by: (a) $2.8 million for fiscal year
29 1981; (b) for fiscal year 1982, .54% of the funds distributed
30 from the fund during the preceding fiscal year; (c) for
31 fiscal year 1983 through fiscal year 1988, .54% of the funds
32 distributed from the fund during the preceding fiscal year
33 less .02% of such fund for fiscal year 1983 and less .02% of
34 such funds for each fiscal year thereafter, or (d) for fiscal
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1 year 1989 and beyond no more than 105% of the actual
2 administrative expenses of the prior fiscal year. Such
3 portion of the fund shall be determined after the transfer
4 into the General Revenue Fund due to refunds, if any, paid
5 from the General Revenue Fund during the preceding quarter.
6 If at any time, for any reason, there is insufficient amount
7 in the Personal Property Tax Replacement Fund for payment of
8 costs of administration or for transfers due to refunds at
9 the end of any particular month, the amount of such
10 insufficiency shall be carried over for the purposes of
11 transfers into the General Revenue Fund and for purposes of
12 costs of administration to the following month or months.
13 Net replacement revenue held, and defined above, shall be
14 transferred by the Treasurer and Comptroller to the Personal
15 Property Tax Replacement Fund within 10 days of such
16 certification.
17 (2) Each quarterly allocation shall first be apportioned
18 in the following manner: 51.65% for taxing districts in Cook
19 County and 48.35% for taxing districts in the remainder of
20 the State.
21 The Personal Property Replacement Ratio of each taxing
22 district outside Cook County shall be the ratio which the Tax
23 Base of that taxing district bears to the Downstate Tax Base.
24 The Tax Base of each taxing district outside of Cook County
25 is the personal property tax collections for that taxing
26 district for the 1977 tax year. The Downstate Tax Base is
27 the personal property tax collections for all taxing
28 districts in the State outside of Cook County for the 1977
29 tax year. The Department of Revenue shall have authority to
30 review for accuracy and completeness the personal property
31 tax collections for each taxing district outside Cook County
32 for the 1977 tax year.
33 The Personal Property Replacement Ratio of each Cook
34 County taxing district shall be the ratio which the Tax Base
SB88 Enrolled -26- LRB9202600SMdv
1 of that taxing district bears to the Cook County Tax Base.
2 The Tax Base of each Cook County taxing district is the
3 personal property tax collections for that taxing district
4 for the 1976 tax year. The Cook County Tax Base is the
5 personal property tax collections for all taxing districts in
6 Cook County for the 1976 tax year. The Department of Revenue
7 shall have authority to review for accuracy and completeness
8 the personal property tax collections for each taxing
9 district within Cook County for the 1976 tax year.
10 For all purposes of this Section 12, amounts paid to a
11 taxing district for such tax years as may be applicable by a
12 foreign corporation under the provisions of Section 7-202 of
13 the Public Utilities Act, as amended, shall be deemed to be
14 personal property taxes collected by such taxing district for
15 such tax years as may be applicable. The Director shall
16 determine from the Illinois Commerce Commission, for any tax
17 year as may be applicable, the amounts so paid by any such
18 foreign corporation to any and all taxing districts. The
19 Illinois Commerce Commission shall furnish such information
20 to the Director. For all purposes of this Section 12, the
21 Director shall deem such amounts to be collected personal
22 property taxes of each such taxing district for the
23 applicable tax year or years.
24 Taxing districts located both in Cook County and in one
25 or more other counties shall receive both a Cook County
26 allocation and a Downstate allocation determined in the same
27 way as all other taxing districts.
28 If any taxing district in existence on July 1, 1979
29 ceases to exist, or discontinues its operations, its Tax Base
30 shall thereafter be deemed to be zero. If the powers, duties
31 and obligations of the discontinued taxing district are
32 assumed by another taxing district, the Tax Base of the
33 discontinued taxing district shall be added to the Tax Base
34 of the taxing district assuming such powers, duties and
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1 obligations.
2 If two or more taxing districts in existence on July 1,
3 1979, or a successor or successors thereto shall consolidate
4 into one taxing district, the Tax Base of such consolidated
5 taxing district shall be the sum of the Tax Bases of each of
6 the taxing districts which have consolidated.
7 If a single taxing district in existence on July 1, 1979,
8 or a successor or successors thereto shall be divided into
9 two or more separate taxing districts, the tax base of the
10 taxing district so divided shall be allocated to each of the
11 resulting taxing districts in proportion to the then current
12 equalized assessed value of each resulting taxing district.
13 If a portion of the territory of a taxing district is
14 disconnected and annexed to another taxing district of the
15 same type, the Tax Base of the taxing district from which
16 disconnection was made shall be reduced in proportion to the
17 then current equalized assessed value of the disconnected
18 territory as compared with the then current equalized
19 assessed value within the entire territory of the taxing
20 district prior to disconnection, and the amount of such
21 reduction shall be added to the Tax Base of the taxing
22 district to which annexation is made.
23 If a community college district is created after July 1,
24 1979, beginning on the effective date of this amendatory Act
25 of 1995, its Tax Base shall be 3.5% of the sum of the
26 personal property tax collected for the 1977 tax year within
27 the territorial jurisdiction of the district.
28 The amounts allocated and paid to taxing districts
29 pursuant to the provisions of this amendatory Act of 1979
30 shall be deemed to be substitute revenues for the revenues
31 derived from taxes imposed on personal property pursuant to
32 the provisions of the "Revenue Act of 1939" or "An Act for
33 the assessment and taxation of private car line companies",
34 approved July 22, 1943, as amended, or Section 414 of the
SB88 Enrolled -28- LRB9202600SMdv
1 Illinois Insurance Code, prior to the abolition of such taxes
2 and shall be used for the same purposes as the revenues
3 derived from ad valorem taxes on real estate.
4 Monies received by any taxing districts from the Personal
5 Property Tax Replacement Fund shall be first applied toward
6 payment of the proportionate amount of debt service which was
7 previously levied and collected from extensions against
8 personal property on bonds outstanding as of December 31,
9 1978 and next applied toward payment of the proportionate
10 share of the pension or retirement obligations of the taxing
11 district which were previously levied and collected from
12 extensions against personal property. For each such
13 outstanding bond issue, the County Clerk shall determine the
14 percentage of the debt service which was collected from
15 extensions against real estate in the taxing district for
16 1978 taxes payable in 1979, as related to the total amount of
17 such levies and collections from extensions against both real
18 and personal property. For 1979 and subsequent years' taxes,
19 the County Clerk shall levy and extend taxes against the real
20 estate of each taxing district which will yield the said
21 percentage or percentages of the debt service on such
22 outstanding bonds. The balance of the amount necessary to
23 fully pay such debt service shall constitute a first and
24 prior lien upon the monies received by each such taxing
25 district through the Personal Property Tax Replacement Fund
26 and shall be first applied or set aside for such purpose. In
27 counties having fewer than 3,000,000 inhabitants, the
28 amendments to this paragraph as made by this amendatory Act
29 of 1980 shall be first applicable to 1980 taxes to be
30 collected in 1981.
31 (Source: P.A. 89-327, eff. 1-1-96; 90-154, eff. 1-1-98.)
32 Section 90-10. The Telecommunications Excise Tax Act is
33 amended by changing Sections 2, 6, and 15 as follows:
SB88 Enrolled -29- LRB9202600SMdv
1 (35 ILCS 630/2) (from Ch. 120, par. 2002)
2 (Text of Section before amendment by P.A. 92-474)
3 Sec. 2. As used in this Article, unless the context
4 clearly requires otherwise:
5 (a) "Gross charge" means the amount paid for the act or
6 privilege of originating or receiving telecommunications in
7 this State and for all services and equipment provided in
8 connection therewith by a retailer, valued in money whether
9 paid in money or otherwise, including cash, credits, services
10 and property of every kind or nature, and shall be determined
11 without any deduction on account of the cost of such
12 telecommunications, the cost of materials used, labor or
13 service costs or any other expense whatsoever. In case
14 credit is extended, the amount thereof shall be included only
15 as and when paid. "Gross charges" for private line service
16 shall include charges imposed at each channel point within
17 this State, charges for the channel mileage between each
18 channel point within this State, and charges for that portion
19 of the interstate inter-office channel provided within
20 Illinois. However, "gross charges" shall not include:
21 (1) any amounts added to a purchaser's bill because
22 of a charge made pursuant to (i) the tax imposed by this
23 Article; (ii) charges added to customers' bills pursuant
24 to the provisions of Sections 9-221 or 9-222 of the
25 Public Utilities Act, as amended, or any similar charges
26 added to customers' bills by retailers who are not
27 subject to rate regulation by the Illinois Commerce
28 Commission for the purpose of recovering any of the tax
29 liabilities or other amounts specified in such provisions
30 of such Act; or (iii) the tax imposed by Section 4251 of
31 the Internal Revenue Code; (iv) 911 surcharges; or (v)
32 the tax imposed by the Simplified Municipal
33 Telecommunications Tax Act;
34 (2) charges for a sent collect telecommunication
SB88 Enrolled -30- LRB9202600SMdv
1 received outside of the State;
2 (3) charges for leased time on equipment or charges
3 for the storage of data or information for subsequent
4 retrieval or the processing of data or information
5 intended to change its form or content. Such equipment
6 includes, but is not limited to, the use of calculators,
7 computers, data processing equipment, tabulating
8 equipment or accounting equipment and also includes the
9 usage of computers under a time-sharing agreement;
10 (4) charges for customer equipment, including such
11 equipment that is leased or rented by the customer from
12 any source, wherein such charges are disaggregated and
13 separately identified from other charges;
14 (5) charges to business enterprises certified under
15 Section 9-222.1 of the Public Utilities Act, as amended,
16 to the extent of such exemption and during the period of
17 time specified by the Department of Commerce and
18 Community Affairs;
19 (6) charges for telecommunications and all services
20 and equipment provided in connection therewith between a
21 parent corporation and its wholly owned subsidiaries or
22 between wholly owned subsidiaries when the tax imposed
23 under this Article has already been paid to a retailer
24 and only to the extent that the charges between the
25 parent corporation and wholly owned subsidiaries or
26 between wholly owned subsidiaries represent expense
27 allocation between the corporations and not the
28 generation of profit for the corporation rendering such
29 service;
30 (7) bad debts. Bad debt means any portion of a debt
31 that is related to a sale at retail for which gross
32 charges are not otherwise deductible or excludable that
33 has become worthless or uncollectable, as determined
34 under applicable federal income tax standards. If the
SB88 Enrolled -31- LRB9202600SMdv
1 portion of the debt deemed to be bad is subsequently
2 paid, the retailer shall report and pay the tax on that
3 portion during the reporting period in which the payment
4 is made;
5 (8) charges paid by inserting coins in
6 coin-operated telecommunication devices;
7 (9) amounts paid by telecommunications retailers
8 under the Telecommunications Municipal Infrastructure
9 Maintenance Fee Act.
10 (b) "Amount paid" means the amount charged to the
11 taxpayer's service address in this State regardless of where
12 such amount is billed or paid.
13 (c) "Telecommunications", in addition to the meaning
14 ordinarily and popularly ascribed to it, includes, without
15 limitation, messages or information transmitted through use
16 of local, toll and wide area telephone service; private line
17 services; channel services; telegraph services;
18 teletypewriter; computer exchange services; cellular mobile
19 telecommunications service; specialized mobile radio;
20 stationary two way radio; paging service; or any other form
21 of mobile and portable one-way or two-way communications; or
22 any other transmission of messages or information by
23 electronic or similar means, between or among points by wire,
24 cable, fiber-optics, laser, microwave, radio, satellite or
25 similar facilities. As used in this Act, "private line" means
26 a dedicated non-traffic sensitive service for a single
27 customer, that entitles the customer to exclusive or priority
28 use of a communications channel or group of channels, from
29 one or more specified locations to one or more other
30 specified locations. The definition of "telecommunications"
31 shall not include value added services in which computer
32 processing applications are used to act on the form, content,
33 code and protocol of the information for purposes other than
34 transmission. "Telecommunications" shall not include
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1 purchases of telecommunications by a telecommunications
2 service provider for use as a component part of the service
3 provided by him to the ultimate retail consumer who
4 originates or terminates the taxable end-to-end
5 communications. Carrier access charges, right of access
6 charges, charges for use of inter-company facilities, and all
7 telecommunications resold in the subsequent provision of,
8 used as a component of, or integrated into end-to-end
9 telecommunications service shall be non-taxable as sales for
10 resale.
11 (d) "Interstate telecommunications" means all
12 telecommunications that either originate or terminate outside
13 this State.
14 (e) "Intrastate telecommunications" means all
15 telecommunications that originate and terminate within this
16 State.
17 (f) "Department" means the Department of Revenue of the
18 State of Illinois.
19 (g) "Director" means the Director of Revenue for the
20 Department of Revenue of the State of Illinois.
21 (h) "Taxpayer" means a person who individually or
22 through his agents, employees or permittees engages in the
23 act or privilege of originating or receiving
24 telecommunications in this State and who incurs a tax
25 liability under this Article.
26 (i) "Person" means any natural individual, firm, trust,
27 estate, partnership, association, joint stock company, joint
28 venture, corporation, limited liability company, or a
29 receiver, trustee, guardian or other representative appointed
30 by order of any court, the Federal and State governments,
31 including State universities created by statute or any city,
32 town, county or other political subdivision of this State.
33 (j) "Purchase at retail" means the acquisition,
34 consumption or use of telecommunication through a sale at
SB88 Enrolled -33- LRB9202600SMdv
1 retail.
2 (k) "Sale at retail" means the transmitting, supplying
3 or furnishing of telecommunications and all services and
4 equipment provided in connection therewith for a
5 consideration to persons other than the Federal and State
6 governments, and State universities created by statute and
7 other than between a parent corporation and its wholly owned
8 subsidiaries or between wholly owned subsidiaries for their
9 use or consumption and not for resale.
10 (l) "Retailer" means and includes every person engaged
11 in the business of making sales at retail as defined in this
12 Article. The Department may, in its discretion, upon
13 application, authorize the collection of the tax hereby
14 imposed by any retailer not maintaining a place of business
15 within this State, who, to the satisfaction of the
16 Department, furnishes adequate security to insure collection
17 and payment of the tax. Such retailer shall be issued,
18 without charge, a permit to collect such tax. When so
19 authorized, it shall be the duty of such retailer to collect
20 the tax upon all of the gross charges for telecommunications
21 in this State in the same manner and subject to the same
22 requirements as a retailer maintaining a place of business
23 within this State. The permit may be revoked by the
24 Department at its discretion.
25 (m) "Retailer maintaining a place of business in this
26 State", or any like term, means and includes any retailer
27 having or maintaining within this State, directly or by a
28 subsidiary, an office, distribution facilities, transmission
29 facilities, sales office, warehouse or other place of
30 business, or any agent or other representative operating
31 within this State under the authority of the retailer or its
32 subsidiary, irrespective of whether such place of business or
33 agent or other representative is located here permanently or
34 temporarily, or whether such retailer or subsidiary is
SB88 Enrolled -34- LRB9202600SMdv
1 licensed to do business in this State.
2 (n) "Service address" means the location of
3 telecommunications equipment from which the
4 telecommunications services are originated or at which
5 telecommunications services are received by a taxpayer. In
6 the event this may not be a defined location, as in the case
7 of mobile phones, paging systems, maritime systems,
8 air-to-ground systems and the like, service address shall
9 mean the location of a taxpayer's primary use of the
10 telecommunications equipment as defined by telephone number,
11 authorization code, or location in Illinois where bills are
12 sent.
13 (o) "Prepaid telephone calling arrangements" mean the
14 right to exclusively purchase telephone or telecommunications
15 services that must be paid for in advance and enable the
16 origination of one or more intrastate, interstate, or
17 international telephone calls or other telecommunications
18 using an access number, an authorization code, or both,
19 whether manually or electronically dialed, for which payment
20 to a retailer must be made in advance, provided that, unless
21 recharged, no further service is provided once that prepaid
22 amount of service has been consumed. Prepaid telephone
23 calling arrangements include the recharge of a prepaid
24 calling arrangement. For purposes of this subsection,
25 "recharge" means the purchase of additional prepaid telephone
26 or telecommunications services whether or not the purchaser
27 acquires a different access number or authorization code.
28 "Prepaid telephone calling arrangement" does not include an
29 arrangement whereby a customer purchases a payment card and
30 pursuant to which the service provider reflects the amount of
31 such purchase as a credit on an invoice issued to that
32 customer under an existing subscription plan.
33 (Source: P.A. 90-562, eff. 12-16-97; 91-870, eff. 6-22-00.)
34 (Text of Section after amendment by P.A. 92-474)
SB88 Enrolled -35- LRB9202600SMdv
1 Sec. 2. As used in this Article, unless the context
2 clearly requires otherwise:
3 (a) "Gross charge" means the amount paid for the act or
4 privilege of originating or receiving telecommunications in
5 this State and for all services and equipment provided in
6 connection therewith by a retailer, valued in money whether
7 paid in money or otherwise, including cash, credits, services
8 and property of every kind or nature, and shall be determined
9 without any deduction on account of the cost of such
10 telecommunications, the cost of materials used, labor or
11 service costs or any other expense whatsoever. In case
12 credit is extended, the amount thereof shall be included only
13 as and when paid. "Gross charges" for private line service
14 shall include charges imposed at each channel point within
15 this State, charges for the channel mileage between each
16 channel point within this State, and charges for that portion
17 of the interstate inter-office channel provided within
18 Illinois. However, "gross charges" shall not include:
19 (1) any amounts added to a purchaser's bill because
20 of a charge made pursuant to (i) the tax imposed by this
21 Article; (ii) charges added to customers' bills pursuant
22 to the provisions of Sections 9-221 or 9-222 of the
23 Public Utilities Act, as amended, or any similar charges
24 added to customers' bills by retailers who are not
25 subject to rate regulation by the Illinois Commerce
26 Commission for the purpose of recovering any of the tax
27 liabilities or other amounts specified in such provisions
28 of such Act; or (iii) the tax imposed by Section 4251 of
29 the Internal Revenue Code; (iv) 911 surcharges; or (v)
30 the tax imposed by the Simplified Municipal
31 Telecommunications Tax Act;
32 (2) charges for a sent collect telecommunication
33 received outside of the State;
34 (3) charges for leased time on equipment or charges
SB88 Enrolled -36- LRB9202600SMdv
1 for the storage of data or information for subsequent
2 retrieval or the processing of data or information
3 intended to change its form or content. Such equipment
4 includes, but is not limited to, the use of calculators,
5 computers, data processing equipment, tabulating
6 equipment or accounting equipment and also includes the
7 usage of computers under a time-sharing agreement;
8 (4) charges for customer equipment, including such
9 equipment that is leased or rented by the customer from
10 any source, wherein such charges are disaggregated and
11 separately identified from other charges;
12 (5) charges to business enterprises certified under
13 Section 9-222.1 of the Public Utilities Act, as amended,
14 to the extent of such exemption and during the period of
15 time specified by the Department of Commerce and
16 Community Affairs;
17 (6) charges for telecommunications and all services
18 and equipment provided in connection therewith between a
19 parent corporation and its wholly owned subsidiaries or
20 between wholly owned subsidiaries when the tax imposed
21 under this Article has already been paid to a retailer
22 and only to the extent that the charges between the
23 parent corporation and wholly owned subsidiaries or
24 between wholly owned subsidiaries represent expense
25 allocation between the corporations and not the
26 generation of profit for the corporation rendering such
27 service;
28 (7) bad debts. Bad debt means any portion of a debt
29 that is related to a sale at retail for which gross
30 charges are not otherwise deductible or excludable that
31 has become worthless or uncollectable, as determined
32 under applicable federal income tax standards. If the
33 portion of the debt deemed to be bad is subsequently
34 paid, the retailer shall report and pay the tax on that
SB88 Enrolled -37- LRB9202600SMdv
1 portion during the reporting period in which the payment
2 is made;
3 (8) charges paid by inserting coins in
4 coin-operated telecommunication devices;
5 (9) amounts paid by telecommunications retailers
6 under the Telecommunications Municipal Infrastructure
7 Maintenance Fee Act.
8 (b) "Amount paid" means the amount charged to the
9 taxpayer's service address in this State regardless of where
10 such amount is billed or paid.
11 (c) "Telecommunications", in addition to the meaning
12 ordinarily and popularly ascribed to it, includes, without
13 limitation, messages or information transmitted through use
14 of local, toll and wide area telephone service; private line
15 services; channel services; telegraph services;
16 teletypewriter; computer exchange services; cellular mobile
17 telecommunications service; specialized mobile radio;
18 stationary two way radio; paging service; or any other form
19 of mobile and portable one-way or two-way communications; or
20 any other transmission of messages or information by
21 electronic or similar means, between or among points by wire,
22 cable, fiber-optics, laser, microwave, radio, satellite or
23 similar facilities. As used in this Act, "private line" means
24 a dedicated non-traffic sensitive service for a single
25 customer, that entitles the customer to exclusive or priority
26 use of a communications channel or group of channels, from
27 one or more specified locations to one or more other
28 specified locations. The definition of "telecommunications"
29 shall not include value added services in which computer
30 processing applications are used to act on the form, content,
31 code and protocol of the information for purposes other than
32 transmission. "Telecommunications" shall not include
33 purchases of telecommunications by a telecommunications
34 service provider for use as a component part of the service
SB88 Enrolled -38- LRB9202600SMdv
1 provided by him to the ultimate retail consumer who
2 originates or terminates the taxable end-to-end
3 communications. Carrier access charges, right of access
4 charges, charges for use of inter-company facilities, and all
5 telecommunications resold in the subsequent provision of,
6 used as a component of, or integrated into end-to-end
7 telecommunications service shall be non-taxable as sales for
8 resale.
9 (d) "Interstate telecommunications" means all
10 telecommunications that either originate or terminate outside
11 this State.
12 (e) "Intrastate telecommunications" means all
13 telecommunications that originate and terminate within this
14 State.
15 (f) "Department" means the Department of Revenue of the
16 State of Illinois.
17 (g) "Director" means the Director of Revenue for the
18 Department of Revenue of the State of Illinois.
19 (h) "Taxpayer" means a person who individually or
20 through his agents, employees or permittees engages in the
21 act or privilege of originating or receiving
22 telecommunications in this State and who incurs a tax
23 liability under this Article.
24 (i) "Person" means any natural individual, firm, trust,
25 estate, partnership, association, joint stock company, joint
26 venture, corporation, limited liability company, or a
27 receiver, trustee, guardian or other representative appointed
28 by order of any court, the Federal and State governments,
29 including State universities created by statute or any city,
30 town, county or other political subdivision of this State.
31 (j) "Purchase at retail" means the acquisition,
32 consumption or use of telecommunication through a sale at
33 retail.
34 (k) "Sale at retail" means the transmitting, supplying
SB88 Enrolled -39- LRB9202600SMdv
1 or furnishing of telecommunications and all services and
2 equipment provided in connection therewith for a
3 consideration to persons other than the Federal and State
4 governments, and State universities created by statute and
5 other than between a parent corporation and its wholly owned
6 subsidiaries or between wholly owned subsidiaries for their
7 use or consumption and not for resale.
8 (l) "Retailer" means and includes every person engaged
9 in the business of making sales at retail as defined in this
10 Article. The Department may, in its discretion, upon
11 application, authorize the collection of the tax hereby
12 imposed by any retailer not maintaining a place of business
13 within this State, who, to the satisfaction of the
14 Department, furnishes adequate security to insure collection
15 and payment of the tax. Such retailer shall be issued,
16 without charge, a permit to collect such tax. When so
17 authorized, it shall be the duty of such retailer to collect
18 the tax upon all of the gross charges for telecommunications
19 in this State in the same manner and subject to the same
20 requirements as a retailer maintaining a place of business
21 within this State. The permit may be revoked by the
22 Department at its discretion.
23 (m) "Retailer maintaining a place of business in this
24 State", or any like term, means and includes any retailer
25 having or maintaining within this State, directly or by a
26 subsidiary, an office, distribution facilities, transmission
27 facilities, sales office, warehouse or other place of
28 business, or any agent or other representative operating
29 within this State under the authority of the retailer or its
30 subsidiary, irrespective of whether such place of business or
31 agent or other representative is located here permanently or
32 temporarily, or whether such retailer or subsidiary is
33 licensed to do business in this State.
34 (n) "Service address" means the location of
SB88 Enrolled -40- LRB9202600SMdv
1 telecommunications equipment from which the
2 telecommunications services are originated or at which
3 telecommunications services are received by a taxpayer. In
4 the event this may not be a defined location, as in the case
5 of mobile phones, paging systems, maritime systems, service
6 address means the customer's place of primary use as defined
7 in the Mobile Telecommunications Sourcing Conformity Act.
8 For air-to-ground systems and the like, service address shall
9 mean the location of a taxpayer's primary use of the
10 telecommunications equipment as defined by telephone number,
11 authorization code, or location in Illinois where bills are
12 sent.
13 (o) "Prepaid telephone calling arrangements" mean the
14 right to exclusively purchase telephone or telecommunications
15 services that must be paid for in advance and enable the
16 origination of one or more intrastate, interstate, or
17 international telephone calls or other telecommunications
18 using an access number, an authorization code, or both,
19 whether manually or electronically dialed, for which payment
20 to a retailer must be made in advance, provided that, unless
21 recharged, no further service is provided once that prepaid
22 amount of service has been consumed. Prepaid telephone
23 calling arrangements include the recharge of a prepaid
24 calling arrangement. For purposes of this subsection,
25 "recharge" means the purchase of additional prepaid telephone
26 or telecommunications services whether or not the purchaser
27 acquires a different access number or authorization code.
28 "Prepaid telephone calling arrangement" does not include an
29 arrangement whereby a customer purchases a payment card and
30 pursuant to which the service provider reflects the amount of
31 such purchase as a credit on an invoice issued to that
32 customer under an existing subscription plan.
33 (Source: P.A. 91-870, eff. 6-22-00; 92-474, eff. 8-1-02.)
SB88 Enrolled -41- LRB9202600SMdv
1 (35 ILCS 630/6) (from Ch. 120, par. 2006)
2 Sec. 6. Except as provided hereinafter in this Section,
3 on or before the last 15th day of each month, each retailer
4 maintaining a place of business in this State shall make a
5 return to the Department for the preceding calendar month,
6 stating:
7 1. His name;
8 2. The address of his principal place of business,
9 or and the address of the principal place of business (if
10 that is a different address) from which he engages in the
11 business of transmitting telecommunications;
12 3. Total amount of gross charges billed by him
13 during the preceding calendar month for providing
14 telecommunications during such calendar month;
15 4. Total amount received by him during the
16 preceding calendar month on credit extended;
17 5. Deductions allowed by law;
18 6. Gross charges which were billed by him during
19 the preceding calendar month and upon the basis of which
20 the tax is imposed;
21 7. Amount of tax (computed upon Item 6);
22 8. Such other reasonable information as the
23 Department may require.
24 Any taxpayer required to make payments under this Section
25 may make the payments by electronic funds transfer. The
26 Department shall adopt rules necessary to effectuate a
27 program of electronic funds transfer. Any taxpayer who has
28 average monthly tax billings due to the Department under this
29 Act and the Simplified Municipal Telecommunications Tax Act
30 that exceed $1,000 shall make all payments by electronic
31 funds transfer as required by rules of the Department and
32 shall file the return required by this Section by electronic
33 means as required by rules of the Department.
34 If the retailer's average monthly tax billings due to the
SB88 Enrolled -42- LRB9202600SMdv
1 Department under this Act and the Simplified Municipal
2 Telecommunications Tax Act do not exceed $1,000 $200, the
3 Department may authorize his returns to be filed on a quarter
4 annual basis, with the return for January, February and March
5 of a given year being due by April 30 15 of such year; with
6 the return for April, May and June of a given year being due
7 by July 31st 15 of such year; with the return for July,
8 August and September of a given year being due by October
9 31st 15 of such year; and with the return of October,
10 November and December of a given year being due by January
11 31st 15 of the following year.
12 If the retailer is otherwise required to file a monthly
13 or quarterly return and if the retailer's average monthly tax
14 billings due to the Department under this Act and the
15 Simplified Municipal Telecommunications Tax Act do not exceed
16 $400 $50, the Department may authorize his or her return to
17 be filed on an annual basis, with the return for a given year
18 being due by January 31st 15th of the following year.
19 Notwithstanding any other provision of this Article
20 containing the time within which a retailer may file his
21 return, in the case of any retailer who ceases to engage in a
22 kind of business which makes him responsible for filing
23 returns under this Article, such retailer shall file a final
24 return under this Article with the Department not more than
25 one month after discontinuing such business.
26 In making such return, the retailer shall determine the
27 value of any consideration other than money received by him
28 and he shall include such value in his return. Such
29 determination shall be subject to review and revision by the
30 Department in the manner hereinafter provided for the
31 correction of returns.
32 Each retailer whose average monthly liability to the
33 Department under this Article and the Simplified Municipal
34 Telecommunications Tax Act was $25,000 $10,000 or more during
SB88 Enrolled -43- LRB9202600SMdv
1 the preceding calendar year, excluding the month of highest
2 liability and the month of lowest liability in such calendar
3 year, and who is not operated by a unit of local government,
4 shall make estimated payments to the Department on or before
5 the 7th, 15th, 22nd and last day of the month during which
6 tax collection liability to the Department is incurred in an
7 amount not less than the lower of either 22.5% of the
8 retailer's actual tax collections for the month or 25% of the
9 retailer's actual tax collections for the same calendar month
10 of the preceding year. The amount of such quarter monthly
11 payments shall be credited against the final liability of the
12 retailer's return for that month. Any outstanding credit,
13 approved by the Department, arising from the retailer's
14 overpayment of its final liability for any month may be
15 applied to reduce the amount of any subsequent quarter
16 monthly payment or credited against the final liability of
17 the retailer's return for any subsequent month. If any
18 quarter monthly payment is not paid at the time or in the
19 amount required by this Section, the retailer shall be liable
20 for penalty and interest on the difference between the
21 minimum amount due as a payment and the amount of such
22 payment actually and timely paid, except insofar as the
23 retailer has previously made payments for that month to the
24 Department in excess of the minimum payments previously due.
25 If the Director finds that the information required for
26 the making of an accurate return cannot reasonably be
27 compiled by a retailer within 15 days after the close of the
28 calendar month for which a return is to be made, he may grant
29 an extension of time for the filing of such return for a
30 period of not to exceed 31 calendar days. The granting of
31 such an extension may be conditioned upon the deposit by the
32 retailer with the Department of an amount of money not
33 exceeding the amount estimated by the Director to be due with
34 the return so extended. All such deposits, including any
SB88 Enrolled -44- LRB9202600SMdv
1 heretofore made with the Department, shall be credited
2 against the retailer's liabilities under this Article. If
3 any such deposit exceeds the retailer's present and probable
4 future liabilities under this Article, the Department shall
5 issue to the retailer a credit memorandum, which may be
6 assigned by the retailer to a similar retailer under this
7 Article, in accordance with reasonable rules and regulations
8 to be prescribed by the Department.
9 The retailer making the return herein provided for shall,
10 at the time of making such return, pay to the Department the
11 amount of tax herein imposed, less a discount of 1% which is
12 allowed to reimburse the retailer for the expenses incurred
13 in keeping records, billing the customer, preparing and
14 filing returns, remitting the tax, and supplying data to the
15 Department upon request. No discount may be claimed by a
16 retailer on returns not timely filed and for taxes not timely
17 remitted. On and after the effective date of this Article of
18 1985, $1,000,000 of the moneys received by the Department of
19 Revenue pursuant to this Article shall be paid each month
20 into the Common School Fund and the remainder into the
21 General Revenue Fund. On and after February 1, 1998, however,
22 of the moneys received by the Department of Revenue pursuant
23 to the additional taxes imposed by this amendatory Act of
24 1997 one-half shall be deposited into the School
25 Infrastructure Fund and one-half shall be deposited into the
26 Common School Fund. On and after the effective date of this
27 amendatory Act of the 91st General Assembly, if in any fiscal
28 year the total of the moneys deposited into the School
29 Infrastructure Fund under this Act is less than the total of
30 the moneys deposited into that Fund from the additional taxes
31 imposed by Public Act 90-548 during fiscal year 1999, then,
32 as soon as possible after the close of the fiscal year, the
33 Comptroller shall order transferred and the Treasurer shall
34 transfer from the General Revenue Fund to the School
SB88 Enrolled -45- LRB9202600SMdv
1 Infrastructure Fund an amount equal to the difference between
2 the fiscal year total deposits and the total amount deposited
3 into the Fund in fiscal year 1999.
4 (Source: P.A. 90-16, eff. 6-16-97; 90-548, eff. 12-4-97;
5 91-541, eff. 8-13-99; 91-870, 6-22-00.)
6 (35 ILCS 630/15) (from Ch. 120, par. 2015)
7 Sec. 15. Confidential information. All information
8 received by the Department from returns filed under this
9 Article, or from any investigations conducted under this
10 Article, shall be confidential, except for official purposes,
11 and any person who divulges any such information in any
12 manner, except in accordance with a proper judicial order or
13 as otherwise provided by law, shall be guilty of a Class B
14 misdemeanor.
15 Provided, that nothing contained in this Article shall
16 prevent the Director from publishing or making available to
17 the public the names and addresses of retailers or taxpayers
18 filing returns under this Article, or from publishing or
19 making available reasonable statistics concerning the
20 operation of the tax wherein the contents of returns are
21 grouped into aggregates in such a way that the information
22 contained in any individual return shall not be disclosed.
23 And provided, that nothing contained in this Article
24 shall prevent the Director from making available to the
25 United States Government or the government of any other
26 state, or any officer or agency thereof, for exclusively
27 official purposes, information received by the Department in
28 the administration of this Article, if such other
29 governmental agency agrees to divulge requested tax
30 information to the Department.
31 The furnishing upon request of the Auditor General, or
32 his authorized agents, for official use, of returns filed and
33 information related thereto under this Article is deemed to
SB88 Enrolled -46- LRB9202600SMdv
1 be an official purpose within the meaning of this Section.
2 The furnishing of financial information to a municipality
3 that has imposed a tax under the Simplified Municipal
4 Telecommunications Tax Act, upon request of the chief
5 executive thereof, is an official purpose within the meaning
6 of this Section, provided that the municipality agrees in
7 writing to the requirements of this Section. Information so
8 provided shall be subject to all confidentiality provisions
9 of this Section. The written agreement shall provide for
10 reciprocity, limitations on access, disclosure, and
11 procedures for requesting information.
12 The Director shall make available for public inspection
13 in the Department's principal office and for publication, at
14 cost, administrative decisions issued on or after January 1,
15 1995. These decisions are to be made available in a manner so
16 that the following taxpayer information is not disclosed:
17 (1) The names, addresses, and identification
18 numbers of the taxpayer, related entities, and employees.
19 (2) At the sole discretion of the Director, trade
20 secrets or other confidential information identified as
21 such by the taxpayer, no later than 30 days after receipt
22 of an administrative decision, by such means as the
23 Department shall provide by rule.
24 The Director shall determine the appropriate extent of
25 the deletions allowed in paragraph (2). In the event the
26 taxpayer does not submit deletions, the Director shall make
27 only the deletions specified in paragraph (1).
28 The Director shall make available for public inspection
29 and publication an administrative decision within 180 days
30 after the issuance of the administrative decision. The term
31 "administrative decision" has the same meaning as defined in
32 Section 3-101 of Article III of the Code of Civil Procedure.
33 Costs collected under this Section shall be paid into the Tax
34 Compliance and Administration Fund.
SB88 Enrolled -47- LRB9202600SMdv
1 Nothing contained in this Act shall prevent the Director
2 from divulging information to any person pursuant to a
3 request or authorization made by the taxpayer or by an
4 authorized representative of the taxpayer.
5 (Source: P.A. 90-491, eff. 1-1-98.)
6 Section 90-15. The Telecommunications Municipal
7 Infrastructure Maintenance Fee Act is amended by changing
8 Sections 1, 5, 10, 15, 20, 25, 27, 27.35, 30, and 35 as
9 follows:
10 (35 ILCS 635/1)
11 Sec. 1. Short title. This Act may be cited as the
12 Telecommunications Municipal Infrastructure Maintenance Fee
13 Act.
14 (Source: P.A. 90-154, eff. 1-1-98.)
15 (35 ILCS 635/5)
16 Sec. 5. Legislative intent.
17 (a) The General Assembly imposed a tax on invested
18 capital of utilities to partially replace the personal
19 property tax that was abolished by the Illinois Constitution
20 of 1970. Since that tax was imposed, telecommunications
21 retailers have evolved from utility status into an
22 increasingly competitive industry serving the public.
23 (b) This Act is intended to abolish the invested capital
24 tax on telecommunications retailers (that is, persons engaged
25 in the business of transmitting messages and acting as a
26 retailer of telecommunications as defined in Section 2 of the
27 Telecommunications Excise Tax Act). Cellular
28 telecommunications retailers have already been excluded from
29 application of the invested capital tax by earlier
30 legislative action.
31 (c) For the period prior to the effective date of this
SB88 Enrolled -48- LRB9202600SMdv
1 amendatory Act of the 92nd General Assembly, this Act is also
2 intended to abolish municipal franchise fees with respect to
3 telecommunications retailers, create a uniform system for the
4 collection and distribution of fees associated with the
5 privilege of use of the public right of way for
6 telecommunications activity, and provide municipalities with
7 a comprehensive method of compensation for telecommunications
8 activity including the recovery of reasonable costs of
9 regulating the use of the public rights-of-way for
10 telecommunications activity.
11 (d) For the period from the effective date of this
12 amendatory Act of the 92nd General Assembly through December
13 31, 2002, it is the intent of the General Assembly that the
14 municipal infrastructure maintenance fee and its rate are
15 subject only to the limits prescribed in Section 20, and that
16 the fee and the rate of the fee do not relate to use of the
17 public rights-of-way or the costs associated with maintaining
18 and regulating the use of the public rights-of-way. It is
19 also the intent of the General Assembly that proceeds of the
20 municipal infrastructure maintenance fee may be used for any
21 lawful corporate purpose. It is not the intent of the
22 General Assembly that the municipal infrastructure
23 maintenance fee is in any way compensation for use of the
24 public rights-of-way. It is the intent of the General
25 Assembly that the fee be paid by all telecommunications
26 retailers, regardless of whether they have equipment in the
27 public rights-of-way.
28 (e) This amendatory Act of the 92nd General Assembly is
29 intended to repeal the municipal infrastructure maintenance
30 fee and the optional infrastructure maintenance fee effective
31 January 1, 2003.
32 (Source: P.A. 90-154, eff. 1-1-98; 91-533, eff. 8-13-99.)
33 (35 ILCS 635/10)
SB88 Enrolled -49- LRB9202600SMdv
1 (Text of Section before amendment by P.A. 92-474)
2 Sec. 10. Definitions.
3 (a) "Gross charges" means the amount paid to a
4 telecommunications retailer for the act or privilege of
5 originating or receiving telecommunications in this State or
6 the municipality imposing the fee under this Act, as the
7 context requires, and for all services rendered in connection
8 therewith, valued in money whether paid in money or
9 otherwise, including cash, credits, services, and property of
10 every kind or nature, and shall be determined without any
11 deduction on account of the cost of such telecommunications,
12 the cost of the materials used, labor or service costs, or
13 any other expense whatsoever. In case credit is extended,
14 the amount thereof shall be included only as and when paid.
15 "Gross charges" for private line service shall include
16 charges imposed at each channel point within this State or
17 the municipality imposing the fee under this Act, charges for
18 the channel mileage between each channel point within this
19 State or the municipality imposing the fee under this Act,
20 and charges for that portion of the interstate inter-office
21 channel provided within Illinois or the municipality imposing
22 the fee under this Act. However, "gross charges" shall not
23 include:
24 (1) any amounts added to a purchaser's bill because
25 of a charge made under: (i) the fee imposed by this
26 Section, (ii) additional charges added to a purchaser's
27 bill under Section 9-221 or 9-222 of the Public Utilities
28 Act, (iii) amounts collected under Section 8-11-17 of the
29 Illinois Municipal Code, (iv) the tax imposed by the
30 Telecommunications Excise Tax Act, (iv) (v) 911
31 surcharges, (v) or (vi) the tax imposed by Section 4251
32 of the Internal Revenue Code, or (vi) the tax imposed by
33 the Simplified Municipal Telecommunications Tax Act;
34 (2) charges for a sent collect telecommunication
SB88 Enrolled -50- LRB9202600SMdv
1 received outside of this State or the municipality
2 imposing the fee, as the context requires;
3 (3) charges for leased time on equipment or charges
4 for the storage of data or information or subsequent
5 retrieval or the processing of data or information
6 intended to change its form or content. Such equipment
7 includes, but is not limited to, the use of calculators,
8 computers, data processing equipment, tabulating
9 equipment, or accounting equipment and also includes the
10 usage of computers under a time-sharing agreement.
11 (4) charges for customer equipment, including such
12 equipment that is leased or rented by the customer from
13 any source, wherein such charges are disaggregated and
14 separately identified from other charges;
15 (5) charges to business enterprises certified under
16 Section 9-222.1 of the Public Utilities Act to the extent
17 of such exemption and during the period of time specified
18 by the Department of Commerce and Community Affairs or by
19 the municipality imposing the fee under the Act, as the
20 context requires;
21 (6) charges for telecommunications and all services
22 and equipment provided in connection therewith between a
23 parent corporation and its wholly owned subsidiaries or
24 between wholly owned subsidiaries, and only to the extent
25 that the charges between the parent corporation and
26 wholly owned subsidiaries or between wholly owned
27 subsidiaries represent expense allocation between the
28 corporations and not the generation of profit other than
29 a regulatory required profit for the corporation
30 rendering such services;
31 (7) bad debts ("bad debt" means any portion of a
32 debt that is related to a sale at retail for which gross
33 charges are not otherwise deductible or excludable that
34 has become worthless or uncollectible, as determined
SB88 Enrolled -51- LRB9202600SMdv
1 under applicable federal income tax standards; if the
2 portion of the debt deemed to be bad is subsequently
3 paid, the retailer shall report and pay the tax on that
4 portion during the reporting period in which the payment
5 is made); or
6 (8) charges paid by inserting coins in
7 coin-operated telecommunication devices.; or
8 (9) charges for telecommunications and all services
9 and equipment provided to a municipality imposing the
10 infrastructure maintenance fee.
11 (a-5) "Department" means the Illinois Department of
12 Revenue.
13 (b) "Telecommunications" includes, but is not limited
14 to, messages or information transmitted through use of local,
15 toll, and wide area telephone service, channel services,
16 telegraph services, teletypewriter service, computer exchange
17 services, private line services, specialized mobile radio
18 services, or any other transmission of messages or
19 information by electronic or similar means, between or among
20 points by wire, cable, fiber optics, laser, microwave, radio,
21 satellite, or similar facilities. Unless the context clearly
22 requires otherwise, "telecommunications" shall also include
23 wireless telecommunications as hereinafter defined.
24 "Telecommunications" shall not include value added services
25 in which computer processing applications are used to act on
26 the form, content, code, and protocol of the information for
27 purposes other than transmission. "Telecommunications" shall
28 not include purchase of telecommunications by a
29 telecommunications service provider for use as a component
30 part of the service provided by him or her to the ultimate
31 retail consumer who originates or terminates the end-to-end
32 communications. Retailer access charges, right of access
33 charges, charges for use of intercompany facilities, and all
34 telecommunications resold in the subsequent provision and
SB88 Enrolled -52- LRB9202600SMdv
1 used as a component of, or integrated into, end-to-end
2 telecommunications service shall not be included in gross
3 charges as sales for resale. "Telecommunications" shall not
4 include the provision of cable services through a cable
5 system as defined in the Cable Communications Act of 1984 (47
6 U.S.C. Sections 521 and following) as now or hereafter
7 amended or through an open video system as defined in the
8 Rules of the Federal Communications Commission (47 C.D.F.
9 76.1550 and following) as now or hereafter amended. Beginning
10 January 1, 2001, prepaid telephone calling arrangements shall
11 not be considered "telecommunications" subject to the tax
12 imposed under this Act. For purposes of this Section,
13 "prepaid telephone calling arrangements" means that term as
14 defined in Section 2-27 of the Retailers' Occupation Tax Act.
15 (c) "Wireless telecommunications" includes cellular
16 mobile telephone services, personal wireless services as
17 defined in Section 704(C) of the Telecommunications Act of
18 1996 (Public Law No. 104-104) as now or hereafter amended,
19 including all commercial mobile radio services, and paging
20 services.
21 (d) "Telecommunications retailer" or "retailer" or
22 "carrier" means and includes every person engaged in the
23 business of making sales of telecommunications at retail as
24 defined in this Section. The Illinois Department of Revenue
25 or the municipality imposing the fee, as the case may be,
26 may, in its discretion, upon applications, authorize the
27 collection of the fee hereby imposed by any retailer not
28 maintaining a place of business within this State, who, to
29 the satisfaction of the Department or municipality, furnishes
30 adequate security to insure collection and payment of the
31 fee. When so authorized, it shall be the duty of such
32 retailer to pay the fee upon all of the gross charges for
33 telecommunications in the same manner and subject to the same
34 requirements as a retailer maintaining a place of business
SB88 Enrolled -53- LRB9202600SMdv
1 within this the State or municipality imposing the fee.
2 (e) "Retailer maintaining a place of business in this
3 State", or any like term, means and includes any retailer
4 having or maintaining within this State, directly or by a
5 subsidiary, an office, distribution facilities, transmission
6 facilities, sales office, warehouse, or other place of
7 business, or any agent or other representative operating
8 within this State under the authority of the retailer or its
9 subsidiary, irrespective of whether such place of business or
10 agent or other representative is located here permanently or
11 temporarily, or whether such retailer or subsidiary is
12 licensed to do business in this State.
13 (f) "Sale of telecommunications at retail" means the
14 transmitting, supplying, or furnishing of telecommunications
15 and all services rendered in connection therewith for a
16 consideration, other than between a parent corporation and
17 its wholly owned subsidiaries or between wholly owned
18 subsidiaries, when the gross charge made by one such
19 corporation to another such corporation is not greater than
20 the gross charge paid to the retailer for their use or
21 consumption and not for sale.
22 (g) "Service address" means the location of
23 telecommunications equipment from which telecommunications
24 services are originated or at which telecommunications
25 services are received. If this is not a defined location, as
26 in the case of wireless telecommunications, paging systems,
27 maritime systems, air-to-ground systems, and the like,
28 "service address" shall mean the location of the customer's
29 primary use of the telecommunications equipment as defined by
30 the location in Illinois where bills are sent.
31 (Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97;
32 91-870, eff. 6-22-00.)
33 (Text of Section after amendment by P.A. 92-474)
34 Sec. 10. Definitions.
SB88 Enrolled -54- LRB9202600SMdv
1 (a) "Gross charges" means the amount paid to a
2 telecommunications retailer for the act or privilege of
3 originating or receiving telecommunications in this State or
4 the municipality imposing the fee under this Act, as the
5 context requires, and for all services rendered in connection
6 therewith, valued in money whether paid in money or
7 otherwise, including cash, credits, services, and property of
8 every kind or nature, and shall be determined without any
9 deduction on account of the cost of such telecommunications,
10 the cost of the materials used, labor or service costs, or
11 any other expense whatsoever. In case credit is extended,
12 the amount thereof shall be included only as and when paid.
13 "Gross charges" for private line service shall include
14 charges imposed at each channel point within this State or
15 the municipality imposing the fee under this Act, charges for
16 the channel mileage between each channel point within this
17 State or the municipality imposing the fee under this Act,
18 and charges for that portion of the interstate inter-office
19 channel provided within Illinois or the municipality imposing
20 the fee under this Act. However, "gross charges" shall not
21 include:
22 (1) any amounts added to a purchaser's bill because
23 of a charge made under: (i) the fee imposed by this
24 Section, (ii) additional charges added to a purchaser's
25 bill under Section 9-221 or 9-222 of the Public Utilities
26 Act, (iii) amounts collected under Section 8-11-17 of the
27 Illinois Municipal Code, (iv) the tax imposed by the
28 Telecommunications Excise Tax Act, (iv) (v) 911
29 surcharges, (v) or (vi) the tax imposed by Section 4251
30 of the Internal Revenue Code, or (vi) the tax imposed by
31 the Simplified Municipal Telecommunications Tax Act;
32 (2) charges for a sent collect telecommunication
33 received outside of this State or the municipality
34 imposing the fee, as the context requires;
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1 (3) charges for leased time on equipment or charges
2 for the storage of data or information or subsequent
3 retrieval or the processing of data or information
4 intended to change its form or content. Such equipment
5 includes, but is not limited to, the use of calculators,
6 computers, data processing equipment, tabulating
7 equipment, or accounting equipment and also includes the
8 usage of computers under a time-sharing agreement;
9 (4) charges for customer equipment, including such
10 equipment that is leased or rented by the customer from
11 any source, wherein such charges are disaggregated and
12 separately identified from other charges;
13 (5) charges to business enterprises certified under
14 Section 9-222.1 of the Public Utilities Act to the extent
15 of such exemption and during the period of time specified
16 by the Department of Commerce and Community Affairs or by
17 the municipality imposing the fee under the Act, as the
18 context requires;
19 (6) charges for telecommunications and all services
20 and equipment provided in connection therewith between a
21 parent corporation and its wholly owned subsidiaries or
22 between wholly owned subsidiaries, and only to the extent
23 that the charges between the parent corporation and
24 wholly owned subsidiaries or between wholly owned
25 subsidiaries represent expense allocation between the
26 corporations and not the generation of profit other than
27 a regulatory required profit for the corporation
28 rendering such services;
29 (7) bad debts ("bad debt" means any portion of a
30 debt that is related to a sale at retail for which gross
31 charges are not otherwise deductible or excludable that
32 has become worthless or uncollectible, as determined
33 under applicable federal income tax standards; if the
34 portion of the debt deemed to be bad is subsequently
SB88 Enrolled -56- LRB9202600SMdv
1 paid, the retailer shall report and pay the tax on that
2 portion during the reporting period in which the payment
3 is made); or
4 (8) charges paid by inserting coins in
5 coin-operated telecommunication devices.; or
6 (9) charges for telecommunications and all services
7 and equipment provided to a municipality imposing the
8 infrastructure maintenance fee.
9 (a-5) "Department" means the Illinois Department of
10 Revenue.
11 (b) "Telecommunications" includes, but is not limited
12 to, messages or information transmitted through use of local,
13 toll, and wide area telephone service, channel services,
14 telegraph services, teletypewriter service, computer exchange
15 services, private line services, specialized mobile radio
16 services, or any other transmission of messages o