Public Act 100-0594
 
HB4415 EnrolledLRB100 16104 HLH 31223 b

    AN ACT concerning revenue.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Use Tax Act is amended by changing Section
3-5 as follows:
 
    (35 ILCS 105/3-5)
    Sec. 3-5. Exemptions. Use of the following tangible
personal property is exempt from the tax imposed by this Act:
    (1) Personal property purchased from a corporation,
society, association, foundation, institution, or
organization, other than a limited liability company, that is
organized and operated as a not-for-profit service enterprise
for the benefit of persons 65 years of age or older if the
personal property was not purchased by the enterprise for the
purpose of resale by the enterprise.
    (2) Personal property purchased by a not-for-profit
Illinois county fair association for use in conducting,
operating, or promoting the county fair.
    (3) Personal property purchased by a not-for-profit arts or
cultural organization that establishes, by proof required by
the Department by rule, that it has received an exemption under
Section 501(c)(3) of the Internal Revenue Code and that is
organized and operated primarily for the presentation or
support of arts or cultural programming, activities, or
services. These organizations include, but are not limited to,
music and dramatic arts organizations such as symphony
orchestras and theatrical groups, arts and cultural service
organizations, local arts councils, visual arts organizations,
and media arts organizations. On and after July 1, 2001 (the
effective date of Public Act 92-35) this amendatory Act of the
92nd General Assembly, however, an entity otherwise eligible
for this exemption shall not make tax-free purchases unless it
has an active identification number issued by the Department.
    (4) Personal property purchased by a governmental body, by
a corporation, society, association, foundation, or
institution organized and operated exclusively for charitable,
religious, or educational purposes, or by a not-for-profit
corporation, society, association, foundation, institution, or
organization that has no compensated officers or employees and
that is organized and operated primarily for the recreation of
persons 55 years of age or older. A limited liability company
may qualify for the exemption under this paragraph only if the
limited liability company is organized and operated
exclusively for educational purposes. On and after July 1,
1987, however, no entity otherwise eligible for this exemption
shall make tax-free purchases unless it has an active exemption
identification number issued by the Department.
    (5) Until July 1, 2003, a passenger car that is a
replacement vehicle to the extent that the purchase price of
the car is subject to the Replacement Vehicle Tax.
    (6) Until July 1, 2003 and beginning again on September 1,
2004 through August 30, 2014, graphic arts machinery and
equipment, including repair and replacement parts, both new and
used, and including that manufactured on special order,
certified by the purchaser to be used primarily for graphic
arts production, and including machinery and equipment
purchased for lease. Equipment includes chemicals or chemicals
acting as catalysts but only if the chemicals or chemicals
acting as catalysts effect a direct and immediate change upon a
graphic arts product. Beginning on July 1, 2017, graphic arts
machinery and equipment is included in the manufacturing and
assembling machinery and equipment exemption under paragraph
(18).
    (7) Farm chemicals.
    (8) Legal tender, currency, medallions, or gold or silver
coinage issued by the State of Illinois, the government of the
United States of America, or the government of any foreign
country, and bullion.
    (9) Personal property purchased from a teacher-sponsored
student organization affiliated with an elementary or
secondary school located in Illinois.
    (10) A motor vehicle that is used for automobile renting,
as defined in the Automobile Renting Occupation and Use Tax
Act.
    (11) Farm machinery and equipment, both new and used,
including that manufactured on special order, certified by the
purchaser to be used primarily for production agriculture or
State or federal agricultural programs, including individual
replacement parts for the machinery and equipment, including
machinery and equipment purchased for lease, and including
implements of husbandry defined in Section 1-130 of the
Illinois Vehicle Code, farm machinery and agricultural
chemical and fertilizer spreaders, and nurse wagons required to
be registered under Section 3-809 of the Illinois Vehicle Code,
but excluding other motor vehicles required to be registered
under the Illinois Vehicle Code. Horticultural polyhouses or
hoop houses used for propagating, growing, or overwintering
plants shall be considered farm machinery and equipment under
this item (11). Agricultural chemical tender tanks and dry
boxes shall include units sold separately from a motor vehicle
required to be licensed and units sold mounted on a motor
vehicle required to be licensed if the selling price of the
tender is separately stated.
    Farm machinery and equipment shall include precision
farming equipment that is installed or purchased to be
installed on farm machinery and equipment including, but not
limited to, tractors, harvesters, sprayers, planters, seeders,
or spreaders. Precision farming equipment includes, but is not
limited to, soil testing sensors, computers, monitors,
software, global positioning and mapping systems, and other
such equipment.
    Farm machinery and equipment also includes computers,
sensors, software, and related equipment used primarily in the
computer-assisted operation of production agriculture
facilities, equipment, and activities such as, but not limited
to, the collection, monitoring, and correlation of animal and
crop data for the purpose of formulating animal diets and
agricultural chemicals. This item (11) is exempt from the
provisions of Section 3-90.
    (12) Until June 30, 2013, fuel and petroleum products sold
to or used by an air common carrier, certified by the carrier
to be used for consumption, shipment, or storage in the conduct
of its business as an air common carrier, for a flight destined
for or returning from a location or locations outside the
United States without regard to previous or subsequent domestic
stopovers.
    Beginning July 1, 2013, fuel and petroleum products sold to
or used by an air carrier, certified by the carrier to be used
for consumption, shipment, or storage in the conduct of its
business as an air common carrier, for a flight that (i) is
engaged in foreign trade or is engaged in trade between the
United States and any of its possessions and (ii) transports at
least one individual or package for hire from the city of
origination to the city of final destination on the same
aircraft, without regard to a change in the flight number of
that aircraft.
    (13) Proceeds of mandatory service charges separately
stated on customers' bills for the purchase and consumption of
food and beverages purchased at retail from a retailer, to the
extent that the proceeds of the service charge are in fact
turned over as tips or as a substitute for tips to the
employees who participate directly in preparing, serving,
hosting or cleaning up the food or beverage function with
respect to which the service charge is imposed.
    (14) Until July 1, 2003, oil field exploration, drilling,
and production equipment, including (i) rigs and parts of rigs,
rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
tubular goods, including casing and drill strings, (iii) pumps
and pump-jack units, (iv) storage tanks and flow lines, (v) any
individual replacement part for oil field exploration,
drilling, and production equipment, and (vi) machinery and
equipment purchased for lease; but excluding motor vehicles
required to be registered under the Illinois Vehicle Code.
    (15) Photoprocessing machinery and equipment, including
repair and replacement parts, both new and used, including that
manufactured on special order, certified by the purchaser to be
used primarily for photoprocessing, and including
photoprocessing machinery and equipment purchased for lease.
    (16) Until July 1, 2023, coal Coal and aggregate
exploration, mining, off-highway hauling, processing,
maintenance, and reclamation equipment, including replacement
parts and equipment, and including equipment purchased for
lease, but excluding motor vehicles required to be registered
under the Illinois Vehicle Code. The changes made to this
Section by Public Act 97-767 apply on and after July 1, 2003,
but no claim for credit or refund is allowed on or after August
16, 2013 (the effective date of Public Act 98-456) for such
taxes paid during the period beginning July 1, 2003 and ending
on August 16, 2013 (the effective date of Public Act 98-456).
    (17) Until July 1, 2003, distillation machinery and
equipment, sold as a unit or kit, assembled or installed by the
retailer, certified by the user to be used only for the
production of ethyl alcohol that will be used for consumption
as motor fuel or as a component of motor fuel for the personal
use of the user, and not subject to sale or resale.
    (18) Manufacturing and assembling machinery and equipment
used primarily in the process of manufacturing or assembling
tangible personal property for wholesale or retail sale or
lease, whether that sale or lease is made directly by the
manufacturer or by some other person, whether the materials
used in the process are owned by the manufacturer or some other
person, or whether that sale or lease is made apart from or as
an incident to the seller's engaging in the service occupation
of producing machines, tools, dies, jigs, patterns, gauges, or
other similar items of no commercial value on special order for
a particular purchaser. The exemption provided by this
paragraph (18) does not include machinery and equipment used in
(i) the generation of electricity for wholesale or retail sale;
(ii) the generation or treatment of natural or artificial gas
for wholesale or retail sale that is delivered to customers
through pipes, pipelines, or mains; or (iii) the treatment of
water for wholesale or retail sale that is delivered to
customers through pipes, pipelines, or mains. The provisions of
Public Act 98-583 are declaratory of existing law as to the
meaning and scope of this exemption. Beginning on July 1, 2017,
the exemption provided by this paragraph (18) includes, but is
not limited to, graphic arts machinery and equipment, as
defined in paragraph (6) of this Section.
    (19) Personal property delivered to a purchaser or
purchaser's donee inside Illinois when the purchase order for
that personal property was received by a florist located
outside Illinois who has a florist located inside Illinois
deliver the personal property.
    (20) Semen used for artificial insemination of livestock
for direct agricultural production.
    (21) Horses, or interests in horses, registered with and
meeting the requirements of any of the Arabian Horse Club
Registry of America, Appaloosa Horse Club, American Quarter
Horse Association, United States Trotting Association, or
Jockey Club, as appropriate, used for purposes of breeding or
racing for prizes. This item (21) is exempt from the provisions
of Section 3-90, and the exemption provided for under this item
(21) applies for all periods beginning May 30, 1995, but no
claim for credit or refund is allowed on or after January 1,
2008 for such taxes paid during the period beginning May 30,
2000 and ending on January 1, 2008.
    (22) Computers and communications equipment utilized for
any hospital purpose and equipment used in the diagnosis,
analysis, or treatment of hospital patients purchased by a
lessor who leases the equipment, under a lease of one year or
longer executed or in effect at the time the lessor would
otherwise be subject to the tax imposed by this Act, to a
hospital that has been issued an active tax exemption
identification number by the Department under Section 1g of the
Retailers' Occupation Tax Act. If the equipment is leased in a
manner that does not qualify for this exemption or is used in
any other non-exempt manner, the lessor shall be liable for the
tax imposed under this Act or the Service Use Tax Act, as the
case may be, based on the fair market value of the property at
the time the non-qualifying use occurs. No lessor shall collect
or attempt to collect an amount (however designated) that
purports to reimburse that lessor for the tax imposed by this
Act or the Service Use Tax Act, as the case may be, if the tax
has not been paid by the lessor. If a lessor improperly
collects any such amount from the lessee, the lessee shall have
a legal right to claim a refund of that amount from the lessor.
If, however, that amount is not refunded to the lessee for any
reason, the lessor is liable to pay that amount to the
Department.
    (23) Personal property purchased by a lessor who leases the
property, under a lease of one year or longer executed or in
effect at the time the lessor would otherwise be subject to the
tax imposed by this Act, to a governmental body that has been
issued an active sales tax exemption identification number by
the Department under Section 1g of the Retailers' Occupation
Tax Act. If the property is leased in a manner that does not
qualify for this exemption or used in any other non-exempt
manner, the lessor shall be liable for the tax imposed under
this Act or the Service Use Tax Act, as the case may be, based
on the fair market value of the property at the time the
non-qualifying use occurs. No lessor shall collect or attempt
to collect an amount (however designated) that purports to
reimburse that lessor for the tax imposed by this Act or the
Service Use Tax Act, as the case may be, if the tax has not been
paid by the lessor. If a lessor improperly collects any such
amount from the lessee, the lessee shall have a legal right to
claim a refund of that amount from the lessor. If, however,
that amount is not refunded to the lessee for any reason, the
lessor is liable to pay that amount to the Department.
    (24) Beginning with taxable years ending on or after
December 31, 1995 and ending with taxable years ending on or
before December 31, 2004, personal property that is donated for
disaster relief to be used in a State or federally declared
disaster area in Illinois or bordering Illinois by a
manufacturer or retailer that is registered in this State to a
corporation, society, association, foundation, or institution
that has been issued a sales tax exemption identification
number by the Department that assists victims of the disaster
who reside within the declared disaster area.
    (25) Beginning with taxable years ending on or after
December 31, 1995 and ending with taxable years ending on or
before December 31, 2004, personal property that is used in the
performance of infrastructure repairs in this State, including
but not limited to municipal roads and streets, access roads,
bridges, sidewalks, waste disposal systems, water and sewer
line extensions, water distribution and purification
facilities, storm water drainage and retention facilities, and
sewage treatment facilities, resulting from a State or
federally declared disaster in Illinois or bordering Illinois
when such repairs are initiated on facilities located in the
declared disaster area within 6 months after the disaster.
    (26) Beginning July 1, 1999, game or game birds purchased
at a "game breeding and hunting preserve area" as that term is
used in the Wildlife Code. This paragraph is exempt from the
provisions of Section 3-90.
    (27) A motor vehicle, as that term is defined in Section
1-146 of the Illinois Vehicle Code, that is donated to a
corporation, limited liability company, society, association,
foundation, or institution that is determined by the Department
to be organized and operated exclusively for educational
purposes. For purposes of this exemption, "a corporation,
limited liability company, society, association, foundation,
or institution organized and operated exclusively for
educational purposes" means all tax-supported public schools,
private schools that offer systematic instruction in useful
branches of learning by methods common to public schools and
that compare favorably in their scope and intensity with the
course of study presented in tax-supported schools, and
vocational or technical schools or institutes organized and
operated exclusively to provide a course of study of not less
than 6 weeks duration and designed to prepare individuals to
follow a trade or to pursue a manual, technical, mechanical,
industrial, business, or commercial occupation.
    (28) Beginning January 1, 2000, personal property,
including food, purchased through fundraising events for the
benefit of a public or private elementary or secondary school,
a group of those schools, or one or more school districts if
the events are sponsored by an entity recognized by the school
district that consists primarily of volunteers and includes
parents and teachers of the school children. This paragraph
does not apply to fundraising events (i) for the benefit of
private home instruction or (ii) for which the fundraising
entity purchases the personal property sold at the events from
another individual or entity that sold the property for the
purpose of resale by the fundraising entity and that profits
from the sale to the fundraising entity. This paragraph is
exempt from the provisions of Section 3-90.
    (29) Beginning January 1, 2000 and through December 31,
2001, new or used automatic vending machines that prepare and
serve hot food and beverages, including coffee, soup, and other
items, and replacement parts for these machines. Beginning
January 1, 2002 and through June 30, 2003, machines and parts
for machines used in commercial, coin-operated amusement and
vending business if a use or occupation tax is paid on the
gross receipts derived from the use of the commercial,
coin-operated amusement and vending machines. This paragraph
is exempt from the provisions of Section 3-90.
    (30) Beginning January 1, 2001 and through June 30, 2016,
food for human consumption that is to be consumed off the
premises where it is sold (other than alcoholic beverages, soft
drinks, and food that has been prepared for immediate
consumption) and prescription and nonprescription medicines,
drugs, medical appliances, and insulin, urine testing
materials, syringes, and needles used by diabetics, for human
use, when purchased for use by a person receiving medical
assistance under Article V of the Illinois Public Aid Code who
resides in a licensed long-term care facility, as defined in
the Nursing Home Care Act, or in a licensed facility as defined
in the ID/DD Community Care Act, the MC/DD Act, or the
Specialized Mental Health Rehabilitation Act of 2013.
    (31) Beginning on August 2, 2001 (the effective date of
Public Act 92-227) this amendatory Act of the 92nd General
Assembly, computers and communications equipment utilized for
any hospital purpose and equipment used in the diagnosis,
analysis, or treatment of hospital patients purchased by a
lessor who leases the equipment, under a lease of one year or
longer executed or in effect at the time the lessor would
otherwise be subject to the tax imposed by this Act, to a
hospital that has been issued an active tax exemption
identification number by the Department under Section 1g of the
Retailers' Occupation Tax Act. If the equipment is leased in a
manner that does not qualify for this exemption or is used in
any other nonexempt manner, the lessor shall be liable for the
tax imposed under this Act or the Service Use Tax Act, as the
case may be, based on the fair market value of the property at
the time the nonqualifying use occurs. No lessor shall collect
or attempt to collect an amount (however designated) that
purports to reimburse that lessor for the tax imposed by this
Act or the Service Use Tax Act, as the case may be, if the tax
has not been paid by the lessor. If a lessor improperly
collects any such amount from the lessee, the lessee shall have
a legal right to claim a refund of that amount from the lessor.
If, however, that amount is not refunded to the lessee for any
reason, the lessor is liable to pay that amount to the
Department. This paragraph is exempt from the provisions of
Section 3-90.
    (32) Beginning on August 2, 2001 (the effective date of
Public Act 92-227) this amendatory Act of the 92nd General
Assembly, personal property purchased by a lessor who leases
the property, under a lease of one year or longer executed or
in effect at the time the lessor would otherwise be subject to
the tax imposed by this Act, to a governmental body that has
been issued an active sales tax exemption identification number
by the Department under Section 1g of the Retailers' Occupation
Tax Act. If the property is leased in a manner that does not
qualify for this exemption or used in any other nonexempt
manner, the lessor shall be liable for the tax imposed under
this Act or the Service Use Tax Act, as the case may be, based
on the fair market value of the property at the time the
nonqualifying use occurs. No lessor shall collect or attempt to
collect an amount (however designated) that purports to
reimburse that lessor for the tax imposed by this Act or the
Service Use Tax Act, as the case may be, if the tax has not been
paid by the lessor. If a lessor improperly collects any such
amount from the lessee, the lessee shall have a legal right to
claim a refund of that amount from the lessor. If, however,
that amount is not refunded to the lessee for any reason, the
lessor is liable to pay that amount to the Department. This
paragraph is exempt from the provisions of Section 3-90.
    (33) On and after July 1, 2003 and through June 30, 2004,
the use in this State of motor vehicles of the second division
with a gross vehicle weight in excess of 8,000 pounds and that
are subject to the commercial distribution fee imposed under
Section 3-815.1 of the Illinois Vehicle Code. Beginning on July
1, 2004 and through June 30, 2005, the use in this State of
motor vehicles of the second division: (i) with a gross vehicle
weight rating in excess of 8,000 pounds; (ii) that are subject
to the commercial distribution fee imposed under Section
3-815.1 of the Illinois Vehicle Code; and (iii) that are
primarily used for commercial purposes. Through June 30, 2005,
this exemption applies to repair and replacement parts added
after the initial purchase of such a motor vehicle if that
motor vehicle is used in a manner that would qualify for the
rolling stock exemption otherwise provided for in this Act. For
purposes of this paragraph, the term "used for commercial
purposes" means the transportation of persons or property in
furtherance of any commercial or industrial enterprise,
whether for-hire or not.
    (34) Beginning January 1, 2008, tangible personal property
used in the construction or maintenance of a community water
supply, as defined under Section 3.145 of the Environmental
Protection Act, that is operated by a not-for-profit
corporation that holds a valid water supply permit issued under
Title IV of the Environmental Protection Act. This paragraph is
exempt from the provisions of Section 3-90.
    (35) Beginning January 1, 2010, materials, parts,
equipment, components, and furnishings incorporated into or
upon an aircraft as part of the modification, refurbishment,
completion, replacement, repair, or maintenance of the
aircraft. This exemption includes consumable supplies used in
the modification, refurbishment, completion, replacement,
repair, and maintenance of aircraft, but excludes any
materials, parts, equipment, components, and consumable
supplies used in the modification, replacement, repair, and
maintenance of aircraft engines or power plants, whether such
engines or power plants are installed or uninstalled upon any
such aircraft. "Consumable supplies" include, but are not
limited to, adhesive, tape, sandpaper, general purpose
lubricants, cleaning solution, latex gloves, and protective
films. This exemption applies only to the use of qualifying
tangible personal property by persons who modify, refurbish,
complete, repair, replace, or maintain aircraft and who (i)
hold an Air Agency Certificate and are empowered to operate an
approved repair station by the Federal Aviation
Administration, (ii) have a Class IV Rating, and (iii) conduct
operations in accordance with Part 145 of the Federal Aviation
Regulations. The exemption does not include aircraft operated
by a commercial air carrier providing scheduled passenger air
service pursuant to authority issued under Part 121 or Part 129
of the Federal Aviation Regulations. The changes made to this
paragraph (35) by Public Act 98-534 are declarative of existing
law.
    (36) Tangible personal property purchased by a
public-facilities corporation, as described in Section
11-65-10 of the Illinois Municipal Code, for purposes of
constructing or furnishing a municipal convention hall, but
only if the legal title to the municipal convention hall is
transferred to the municipality without any further
consideration by or on behalf of the municipality at the time
of the completion of the municipal convention hall or upon the
retirement or redemption of any bonds or other debt instruments
issued by the public-facilities corporation in connection with
the development of the municipal convention hall. This
exemption includes existing public-facilities corporations as
provided in Section 11-65-25 of the Illinois Municipal Code.
This paragraph is exempt from the provisions of Section 3-90.
    (37) Beginning January 1, 2017, menstrual pads, tampons,
and menstrual cups.
    (38) Merchandise that is subject to the Rental Purchase
Agreement Occupation and Use Tax. The purchaser must certify
that the item is purchased to be rented subject to a rental
purchase agreement, as defined in the Rental Purchase Agreement
Act, and provide proof of registration under the Rental
Purchase Agreement Occupation and Use Tax Act. This paragraph
is exempt from the provisions of Section 3-90.
(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
100-22, eff. 7-6-17; 100-437, eff. 1-1-18; revised 9-27-17.)
 
    Section 10. The Service Use Tax Act is amended by changing
Section 3-5 as follows:
 
    (35 ILCS 110/3-5)
    Sec. 3-5. Exemptions. Use of the following tangible
personal property is exempt from the tax imposed by this Act:
    (1) Personal property purchased from a corporation,
society, association, foundation, institution, or
organization, other than a limited liability company, that is
organized and operated as a not-for-profit service enterprise
for the benefit of persons 65 years of age or older if the
personal property was not purchased by the enterprise for the
purpose of resale by the enterprise.
    (2) Personal property purchased by a non-profit Illinois
county fair association for use in conducting, operating, or
promoting the county fair.
    (3) Personal property purchased by a not-for-profit arts or
cultural organization that establishes, by proof required by
the Department by rule, that it has received an exemption under
Section 501(c)(3) of the Internal Revenue Code and that is
organized and operated primarily for the presentation or
support of arts or cultural programming, activities, or
services. These organizations include, but are not limited to,
music and dramatic arts organizations such as symphony
orchestras and theatrical groups, arts and cultural service
organizations, local arts councils, visual arts organizations,
and media arts organizations. On and after the effective date
of this amendatory Act of the 92nd General Assembly, however,
an entity otherwise eligible for this exemption shall not make
tax-free purchases unless it has an active identification
number issued by the Department.
    (4) Legal tender, currency, medallions, or gold or silver
coinage issued by the State of Illinois, the government of the
United States of America, or the government of any foreign
country, and bullion.
    (5) Until July 1, 2003 and beginning again on September 1,
2004 through August 30, 2014, graphic arts machinery and
equipment, including repair and replacement parts, both new and
used, and including that manufactured on special order or
purchased for lease, certified by the purchaser to be used
primarily for graphic arts production. Equipment includes
chemicals or chemicals acting as catalysts but only if the
chemicals or chemicals acting as catalysts effect a direct and
immediate change upon a graphic arts product. Beginning on July
1, 2017, graphic arts machinery and equipment is included in
the manufacturing and assembling machinery and equipment
exemption under Section 2 of this Act.
    (6) Personal property purchased from a teacher-sponsored
student organization affiliated with an elementary or
secondary school located in Illinois.
    (7) Farm machinery and equipment, both new and used,
including that manufactured on special order, certified by the
purchaser to be used primarily for production agriculture or
State or federal agricultural programs, including individual
replacement parts for the machinery and equipment, including
machinery and equipment purchased for lease, and including
implements of husbandry defined in Section 1-130 of the
Illinois Vehicle Code, farm machinery and agricultural
chemical and fertilizer spreaders, and nurse wagons required to
be registered under Section 3-809 of the Illinois Vehicle Code,
but excluding other motor vehicles required to be registered
under the Illinois Vehicle Code. Horticultural polyhouses or
hoop houses used for propagating, growing, or overwintering
plants shall be considered farm machinery and equipment under
this item (7). Agricultural chemical tender tanks and dry boxes
shall include units sold separately from a motor vehicle
required to be licensed and units sold mounted on a motor
vehicle required to be licensed if the selling price of the
tender is separately stated.
    Farm machinery and equipment shall include precision
farming equipment that is installed or purchased to be
installed on farm machinery and equipment including, but not
limited to, tractors, harvesters, sprayers, planters, seeders,
or spreaders. Precision farming equipment includes, but is not
limited to, soil testing sensors, computers, monitors,
software, global positioning and mapping systems, and other
such equipment.
    Farm machinery and equipment also includes computers,
sensors, software, and related equipment used primarily in the
computer-assisted operation of production agriculture
facilities, equipment, and activities such as, but not limited
to, the collection, monitoring, and correlation of animal and
crop data for the purpose of formulating animal diets and
agricultural chemicals. This item (7) is exempt from the
provisions of Section 3-75.
    (8) Until June 30, 2013, fuel and petroleum products sold
to or used by an air common carrier, certified by the carrier
to be used for consumption, shipment, or storage in the conduct
of its business as an air common carrier, for a flight destined
for or returning from a location or locations outside the
United States without regard to previous or subsequent domestic
stopovers.
    Beginning July 1, 2013, fuel and petroleum products sold to
or used by an air carrier, certified by the carrier to be used
for consumption, shipment, or storage in the conduct of its
business as an air common carrier, for a flight that (i) is
engaged in foreign trade or is engaged in trade between the
United States and any of its possessions and (ii) transports at
least one individual or package for hire from the city of
origination to the city of final destination on the same
aircraft, without regard to a change in the flight number of
that aircraft.
    (9) Proceeds of mandatory service charges separately
stated on customers' bills for the purchase and consumption of
food and beverages acquired as an incident to the purchase of a
service from a serviceman, to the extent that the proceeds of
the service charge are in fact turned over as tips or as a
substitute for tips to the employees who participate directly
in preparing, serving, hosting or cleaning up the food or
beverage function with respect to which the service charge is
imposed.
    (10) Until July 1, 2003, oil field exploration, drilling,
and production equipment, including (i) rigs and parts of rigs,
rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
tubular goods, including casing and drill strings, (iii) pumps
and pump-jack units, (iv) storage tanks and flow lines, (v) any
individual replacement part for oil field exploration,
drilling, and production equipment, and (vi) machinery and
equipment purchased for lease; but excluding motor vehicles
required to be registered under the Illinois Vehicle Code.
    (11) Proceeds from the sale of photoprocessing machinery
and equipment, including repair and replacement parts, both new
and used, including that manufactured on special order,
certified by the purchaser to be used primarily for
photoprocessing, and including photoprocessing machinery and
equipment purchased for lease.
    (12) Until July 1, 2023, coal Coal and aggregate
exploration, mining, off-highway hauling, processing,
maintenance, and reclamation equipment, including replacement
parts and equipment, and including equipment purchased for
lease, but excluding motor vehicles required to be registered
under the Illinois Vehicle Code. The changes made to this
Section by Public Act 97-767 apply on and after July 1, 2003,
but no claim for credit or refund is allowed on or after August
16, 2013 (the effective date of Public Act 98-456) for such
taxes paid during the period beginning July 1, 2003 and ending
on August 16, 2013 (the effective date of Public Act 98-456).
    (13) Semen used for artificial insemination of livestock
for direct agricultural production.
    (14) Horses, or interests in horses, registered with and
meeting the requirements of any of the Arabian Horse Club
Registry of America, Appaloosa Horse Club, American Quarter
Horse Association, United States Trotting Association, or
Jockey Club, as appropriate, used for purposes of breeding or
racing for prizes. This item (14) is exempt from the provisions
of Section 3-75, and the exemption provided for under this item
(14) applies for all periods beginning May 30, 1995, but no
claim for credit or refund is allowed on or after the effective
date of this amendatory Act of the 95th General Assembly for
such taxes paid during the period beginning May 30, 2000 and
ending on the effective date of this amendatory Act of the 95th
General Assembly.
    (15) Computers and communications equipment utilized for
any hospital purpose and equipment used in the diagnosis,
analysis, or treatment of hospital patients purchased by a
lessor who leases the equipment, under a lease of one year or
longer executed or in effect at the time the lessor would
otherwise be subject to the tax imposed by this Act, to a
hospital that has been issued an active tax exemption
identification number by the Department under Section 1g of the
Retailers' Occupation Tax Act. If the equipment is leased in a
manner that does not qualify for this exemption or is used in
any other non-exempt manner, the lessor shall be liable for the
tax imposed under this Act or the Use Tax Act, as the case may
be, based on the fair market value of the property at the time
the non-qualifying use occurs. No lessor shall collect or
attempt to collect an amount (however designated) that purports
to reimburse that lessor for the tax imposed by this Act or the
Use Tax Act, as the case may be, if the tax has not been paid by
the lessor. If a lessor improperly collects any such amount
from the lessee, the lessee shall have a legal right to claim a
refund of that amount from the lessor. If, however, that amount
is not refunded to the lessee for any reason, the lessor is
liable to pay that amount to the Department.
    (16) Personal property purchased by a lessor who leases the
property, under a lease of one year or longer executed or in
effect at the time the lessor would otherwise be subject to the
tax imposed by this Act, to a governmental body that has been
issued an active tax exemption identification number by the
Department under Section 1g of the Retailers' Occupation Tax
Act. If the property is leased in a manner that does not
qualify for this exemption or is used in any other non-exempt
manner, the lessor shall be liable for the tax imposed under
this Act or the Use Tax Act, as the case may be, based on the
fair market value of the property at the time the
non-qualifying use occurs. No lessor shall collect or attempt
to collect an amount (however designated) that purports to
reimburse that lessor for the tax imposed by this Act or the
Use Tax Act, as the case may be, if the tax has not been paid by
the lessor. If a lessor improperly collects any such amount
from the lessee, the lessee shall have a legal right to claim a
refund of that amount from the lessor. If, however, that amount
is not refunded to the lessee for any reason, the lessor is
liable to pay that amount to the Department.
    (17) Beginning with taxable years ending on or after
December 31, 1995 and ending with taxable years ending on or
before December 31, 2004, personal property that is donated for
disaster relief to be used in a State or federally declared
disaster area in Illinois or bordering Illinois by a
manufacturer or retailer that is registered in this State to a
corporation, society, association, foundation, or institution
that has been issued a sales tax exemption identification
number by the Department that assists victims of the disaster
who reside within the declared disaster area.
    (18) Beginning with taxable years ending on or after
December 31, 1995 and ending with taxable years ending on or
before December 31, 2004, personal property that is used in the
performance of infrastructure repairs in this State, including
but not limited to municipal roads and streets, access roads,
bridges, sidewalks, waste disposal systems, water and sewer
line extensions, water distribution and purification
facilities, storm water drainage and retention facilities, and
sewage treatment facilities, resulting from a State or
federally declared disaster in Illinois or bordering Illinois
when such repairs are initiated on facilities located in the
declared disaster area within 6 months after the disaster.
    (19) Beginning July 1, 1999, game or game birds purchased
at a "game breeding and hunting preserve area" as that term is
used in the Wildlife Code. This paragraph is exempt from the
provisions of Section 3-75.
    (20) A motor vehicle, as that term is defined in Section
1-146 of the Illinois Vehicle Code, that is donated to a
corporation, limited liability company, society, association,
foundation, or institution that is determined by the Department
to be organized and operated exclusively for educational
purposes. For purposes of this exemption, "a corporation,
limited liability company, society, association, foundation,
or institution organized and operated exclusively for
educational purposes" means all tax-supported public schools,
private schools that offer systematic instruction in useful
branches of learning by methods common to public schools and
that compare favorably in their scope and intensity with the
course of study presented in tax-supported schools, and
vocational or technical schools or institutes organized and
operated exclusively to provide a course of study of not less
than 6 weeks duration and designed to prepare individuals to
follow a trade or to pursue a manual, technical, mechanical,
industrial, business, or commercial occupation.
    (21) Beginning January 1, 2000, personal property,
including food, purchased through fundraising events for the
benefit of a public or private elementary or secondary school,
a group of those schools, or one or more school districts if
the events are sponsored by an entity recognized by the school
district that consists primarily of volunteers and includes
parents and teachers of the school children. This paragraph
does not apply to fundraising events (i) for the benefit of
private home instruction or (ii) for which the fundraising
entity purchases the personal property sold at the events from
another individual or entity that sold the property for the
purpose of resale by the fundraising entity and that profits
from the sale to the fundraising entity. This paragraph is
exempt from the provisions of Section 3-75.
    (22) Beginning January 1, 2000 and through December 31,
2001, new or used automatic vending machines that prepare and
serve hot food and beverages, including coffee, soup, and other
items, and replacement parts for these machines. Beginning
January 1, 2002 and through June 30, 2003, machines and parts
for machines used in commercial, coin-operated amusement and
vending business if a use or occupation tax is paid on the
gross receipts derived from the use of the commercial,
coin-operated amusement and vending machines. This paragraph
is exempt from the provisions of Section 3-75.
    (23) Beginning August 23, 2001 and through June 30, 2016,
food for human consumption that is to be consumed off the
premises where it is sold (other than alcoholic beverages, soft
drinks, and food that has been prepared for immediate
consumption) and prescription and nonprescription medicines,
drugs, medical appliances, and insulin, urine testing
materials, syringes, and needles used by diabetics, for human
use, when purchased for use by a person receiving medical
assistance under Article V of the Illinois Public Aid Code who
resides in a licensed long-term care facility, as defined in
the Nursing Home Care Act, or in a licensed facility as defined
in the ID/DD Community Care Act, the MC/DD Act, or the
Specialized Mental Health Rehabilitation Act of 2013.
    (24) Beginning on the effective date of this amendatory Act
of the 92nd General Assembly, computers and communications
equipment utilized for any hospital purpose and equipment used
in the diagnosis, analysis, or treatment of hospital patients
purchased by a lessor who leases the equipment, under a lease
of one year or longer executed or in effect at the time the
lessor would otherwise be subject to the tax imposed by this
Act, to a hospital that has been issued an active tax exemption
identification number by the Department under Section 1g of the
Retailers' Occupation Tax Act. If the equipment is leased in a
manner that does not qualify for this exemption or is used in
any other nonexempt manner, the lessor shall be liable for the
tax imposed under this Act or the Use Tax Act, as the case may
be, based on the fair market value of the property at the time
the nonqualifying use occurs. No lessor shall collect or
attempt to collect an amount (however designated) that purports
to reimburse that lessor for the tax imposed by this Act or the
Use Tax Act, as the case may be, if the tax has not been paid by
the lessor. If a lessor improperly collects any such amount
from the lessee, the lessee shall have a legal right to claim a
refund of that amount from the lessor. If, however, that amount
is not refunded to the lessee for any reason, the lessor is
liable to pay that amount to the Department. This paragraph is
exempt from the provisions of Section 3-75.
    (25) Beginning on the effective date of this amendatory Act
of the 92nd General Assembly, personal property purchased by a
lessor who leases the property, under a lease of one year or
longer executed or in effect at the time the lessor would
otherwise be subject to the tax imposed by this Act, to a
governmental body that has been issued an active tax exemption
identification number by the Department under Section 1g of the
Retailers' Occupation Tax Act. If the property is leased in a
manner that does not qualify for this exemption or is used in
any other nonexempt manner, the lessor shall be liable for the
tax imposed under this Act or the Use Tax Act, as the case may
be, based on the fair market value of the property at the time
the nonqualifying use occurs. No lessor shall collect or
attempt to collect an amount (however designated) that purports
to reimburse that lessor for the tax imposed by this Act or the
Use Tax Act, as the case may be, if the tax has not been paid by
the lessor. If a lessor improperly collects any such amount
from the lessee, the lessee shall have a legal right to claim a
refund of that amount from the lessor. If, however, that amount
is not refunded to the lessee for any reason, the lessor is
liable to pay that amount to the Department. This paragraph is
exempt from the provisions of Section 3-75.
    (26) Beginning January 1, 2008, tangible personal property
used in the construction or maintenance of a community water
supply, as defined under Section 3.145 of the Environmental
Protection Act, that is operated by a not-for-profit
corporation that holds a valid water supply permit issued under
Title IV of the Environmental Protection Act. This paragraph is
exempt from the provisions of Section 3-75.
    (27) Beginning January 1, 2010, materials, parts,
equipment, components, and furnishings incorporated into or
upon an aircraft as part of the modification, refurbishment,
completion, replacement, repair, or maintenance of the
aircraft. This exemption includes consumable supplies used in
the modification, refurbishment, completion, replacement,
repair, and maintenance of aircraft, but excludes any
materials, parts, equipment, components, and consumable
supplies used in the modification, replacement, repair, and
maintenance of aircraft engines or power plants, whether such
engines or power plants are installed or uninstalled upon any
such aircraft. "Consumable supplies" include, but are not
limited to, adhesive, tape, sandpaper, general purpose
lubricants, cleaning solution, latex gloves, and protective
films. This exemption applies only to the use of qualifying
tangible personal property transferred incident to the
modification, refurbishment, completion, replacement, repair,
or maintenance of aircraft by persons who (i) hold an Air
Agency Certificate and are empowered to operate an approved
repair station by the Federal Aviation Administration, (ii)
have a Class IV Rating, and (iii) conduct operations in
accordance with Part 145 of the Federal Aviation Regulations.
The exemption does not include aircraft operated by a
commercial air carrier providing scheduled passenger air
service pursuant to authority issued under Part 121 or Part 129
of the Federal Aviation Regulations. The changes made to this
paragraph (27) by Public Act 98-534 are declarative of existing
law.
    (28) Tangible personal property purchased by a
public-facilities corporation, as described in Section
11-65-10 of the Illinois Municipal Code, for purposes of
constructing or furnishing a municipal convention hall, but
only if the legal title to the municipal convention hall is
transferred to the municipality without any further
consideration by or on behalf of the municipality at the time
of the completion of the municipal convention hall or upon the
retirement or redemption of any bonds or other debt instruments
issued by the public-facilities corporation in connection with
the development of the municipal convention hall. This
exemption includes existing public-facilities corporations as
provided in Section 11-65-25 of the Illinois Municipal Code.
This paragraph is exempt from the provisions of Section 3-75.
    (29) Beginning January 1, 2017, menstrual pads, tampons,
and menstrual cups.
(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
100-22, eff. 7-6-17.)
 
    Section 15. The Service Occupation Tax Act is amended by
changing Section 3-5 as follows:
 
    (35 ILCS 115/3-5)
    Sec. 3-5. Exemptions. The following tangible personal
property is exempt from the tax imposed by this Act:
    (1) Personal property sold by a corporation, society,
association, foundation, institution, or organization, other
than a limited liability company, that is organized and
operated as a not-for-profit service enterprise for the benefit
of persons 65 years of age or older if the personal property
was not purchased by the enterprise for the purpose of resale
by the enterprise.
    (2) Personal property purchased by a not-for-profit
Illinois county fair association for use in conducting,
operating, or promoting the county fair.
    (3) Personal property purchased by any not-for-profit arts
or cultural organization that establishes, by proof required by
the Department by rule, that it has received an exemption under
Section 501(c)(3) of the Internal Revenue Code and that is
organized and operated primarily for the presentation or
support of arts or cultural programming, activities, or
services. These organizations include, but are not limited to,
music and dramatic arts organizations such as symphony
orchestras and theatrical groups, arts and cultural service
organizations, local arts councils, visual arts organizations,
and media arts organizations. On and after the effective date
of this amendatory Act of the 92nd General Assembly, however,
an entity otherwise eligible for this exemption shall not make
tax-free purchases unless it has an active identification
number issued by the Department.
    (4) Legal tender, currency, medallions, or gold or silver
coinage issued by the State of Illinois, the government of the
United States of America, or the government of any foreign
country, and bullion.
    (5) Until July 1, 2003 and beginning again on September 1,
2004 through August 30, 2014, graphic arts machinery and
equipment, including repair and replacement parts, both new and
used, and including that manufactured on special order or
purchased for lease, certified by the purchaser to be used
primarily for graphic arts production. Equipment includes
chemicals or chemicals acting as catalysts but only if the
chemicals or chemicals acting as catalysts effect a direct and
immediate change upon a graphic arts product. Beginning on July
1, 2017, graphic arts machinery and equipment is included in
the manufacturing and assembling machinery and equipment
exemption under Section 2 of this Act.
    (6) Personal property sold by a teacher-sponsored student
organization affiliated with an elementary or secondary school
located in Illinois.
    (7) Farm machinery and equipment, both new and used,
including that manufactured on special order, certified by the
purchaser to be used primarily for production agriculture or
State or federal agricultural programs, including individual
replacement parts for the machinery and equipment, including
machinery and equipment purchased for lease, and including
implements of husbandry defined in Section 1-130 of the
Illinois Vehicle Code, farm machinery and agricultural
chemical and fertilizer spreaders, and nurse wagons required to
be registered under Section 3-809 of the Illinois Vehicle Code,
but excluding other motor vehicles required to be registered
under the Illinois Vehicle Code. Horticultural polyhouses or
hoop houses used for propagating, growing, or overwintering
plants shall be considered farm machinery and equipment under
this item (7). Agricultural chemical tender tanks and dry boxes
shall include units sold separately from a motor vehicle
required to be licensed and units sold mounted on a motor
vehicle required to be licensed if the selling price of the
tender is separately stated.
    Farm machinery and equipment shall include precision
farming equipment that is installed or purchased to be
installed on farm machinery and equipment including, but not
limited to, tractors, harvesters, sprayers, planters, seeders,
or spreaders. Precision farming equipment includes, but is not
limited to, soil testing sensors, computers, monitors,
software, global positioning and mapping systems, and other
such equipment.
    Farm machinery and equipment also includes computers,
sensors, software, and related equipment used primarily in the
computer-assisted operation of production agriculture
facilities, equipment, and activities such as, but not limited
to, the collection, monitoring, and correlation of animal and
crop data for the purpose of formulating animal diets and
agricultural chemicals. This item (7) is exempt from the
provisions of Section 3-55.
    (8) Until June 30, 2013, fuel and petroleum products sold
to or used by an air common carrier, certified by the carrier
to be used for consumption, shipment, or storage in the conduct
of its business as an air common carrier, for a flight destined
for or returning from a location or locations outside the
United States without regard to previous or subsequent domestic
stopovers.
    Beginning July 1, 2013, fuel and petroleum products sold to
or used by an air carrier, certified by the carrier to be used
for consumption, shipment, or storage in the conduct of its
business as an air common carrier, for a flight that (i) is
engaged in foreign trade or is engaged in trade between the
United States and any of its possessions and (ii) transports at
least one individual or package for hire from the city of
origination to the city of final destination on the same
aircraft, without regard to a change in the flight number of
that aircraft.
    (9) Proceeds of mandatory service charges separately
stated on customers' bills for the purchase and consumption of
food and beverages, to the extent that the proceeds of the
service charge are in fact turned over as tips or as a
substitute for tips to the employees who participate directly
in preparing, serving, hosting or cleaning up the food or
beverage function with respect to which the service charge is
imposed.
    (10) Until July 1, 2003, oil field exploration, drilling,
and production equipment, including (i) rigs and parts of rigs,
rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
tubular goods, including casing and drill strings, (iii) pumps
and pump-jack units, (iv) storage tanks and flow lines, (v) any
individual replacement part for oil field exploration,
drilling, and production equipment, and (vi) machinery and
equipment purchased for lease; but excluding motor vehicles
required to be registered under the Illinois Vehicle Code.
    (11) Photoprocessing machinery and equipment, including
repair and replacement parts, both new and used, including that
manufactured on special order, certified by the purchaser to be
used primarily for photoprocessing, and including
photoprocessing machinery and equipment purchased for lease.
    (12) Until July 1, 2023, coal Coal and aggregate
exploration, mining, off-highway hauling, processing,
maintenance, and reclamation equipment, including replacement
parts and equipment, and including equipment purchased for
lease, but excluding motor vehicles required to be registered
under the Illinois Vehicle Code. The changes made to this
Section by Public Act 97-767 apply on and after July 1, 2003,
but no claim for credit or refund is allowed on or after August
16, 2013 (the effective date of Public Act 98-456) for such
taxes paid during the period beginning July 1, 2003 and ending
on August 16, 2013 (the effective date of Public Act 98-456).
    (13) Beginning January 1, 1992 and through June 30, 2016,
food for human consumption that is to be consumed off the
premises where it is sold (other than alcoholic beverages, soft
drinks and food that has been prepared for immediate
consumption) and prescription and non-prescription medicines,
drugs, medical appliances, and insulin, urine testing
materials, syringes, and needles used by diabetics, for human
use, when purchased for use by a person receiving medical
assistance under Article V of the Illinois Public Aid Code who
resides in a licensed long-term care facility, as defined in
the Nursing Home Care Act, or in a licensed facility as defined
in the ID/DD Community Care Act, the MC/DD Act, or the
Specialized Mental Health Rehabilitation Act of 2013.
    (14) Semen used for artificial insemination of livestock
for direct agricultural production.
    (15) Horses, or interests in horses, registered with and
meeting the requirements of any of the Arabian Horse Club
Registry of America, Appaloosa Horse Club, American Quarter
Horse Association, United States Trotting Association, or
Jockey Club, as appropriate, used for purposes of breeding or
racing for prizes. This item (15) is exempt from the provisions
of Section 3-55, and the exemption provided for under this item
(15) applies for all periods beginning May 30, 1995, but no
claim for credit or refund is allowed on or after January 1,
2008 (the effective date of Public Act 95-88) for such taxes
paid during the period beginning May 30, 2000 and ending on
January 1, 2008 (the effective date of Public Act 95-88).
    (16) Computers and communications equipment utilized for
any hospital purpose and equipment used in the diagnosis,
analysis, or treatment of hospital patients sold to a lessor
who leases the equipment, under a lease of one year or longer
executed or in effect at the time of the purchase, to a
hospital that has been issued an active tax exemption
identification number by the Department under Section 1g of the
Retailers' Occupation Tax Act.
    (17) Personal property sold to a lessor who leases the
property, under a lease of one year or longer executed or in
effect at the time of the purchase, to a governmental body that
has been issued an active tax exemption identification number
by the Department under Section 1g of the Retailers' Occupation
Tax Act.
    (18) Beginning with taxable years ending on or after
December 31, 1995 and ending with taxable years ending on or
before December 31, 2004, personal property that is donated for
disaster relief to be used in a State or federally declared
disaster area in Illinois or bordering Illinois by a
manufacturer or retailer that is registered in this State to a
corporation, society, association, foundation, or institution
that has been issued a sales tax exemption identification
number by the Department that assists victims of the disaster
who reside within the declared disaster area.
    (19) Beginning with taxable years ending on or after
December 31, 1995 and ending with taxable years ending on or
before December 31, 2004, personal property that is used in the
performance of infrastructure repairs in this State, including
but not limited to municipal roads and streets, access roads,
bridges, sidewalks, waste disposal systems, water and sewer
line extensions, water distribution and purification
facilities, storm water drainage and retention facilities, and
sewage treatment facilities, resulting from a State or
federally declared disaster in Illinois or bordering Illinois
when such repairs are initiated on facilities located in the
declared disaster area within 6 months after the disaster.
    (20) Beginning July 1, 1999, game or game birds sold at a
"game breeding and hunting preserve area" as that term is used
in the Wildlife Code. This paragraph is exempt from the
provisions of Section 3-55.
    (21) A motor vehicle, as that term is defined in Section
1-146 of the Illinois Vehicle Code, that is donated to a
corporation, limited liability company, society, association,
foundation, or institution that is determined by the Department
to be organized and operated exclusively for educational
purposes. For purposes of this exemption, "a corporation,
limited liability company, society, association, foundation,
or institution organized and operated exclusively for
educational purposes" means all tax-supported public schools,
private schools that offer systematic instruction in useful
branches of learning by methods common to public schools and
that compare favorably in their scope and intensity with the
course of study presented in tax-supported schools, and
vocational or technical schools or institutes organized and
operated exclusively to provide a course of study of not less
than 6 weeks duration and designed to prepare individuals to
follow a trade or to pursue a manual, technical, mechanical,
industrial, business, or commercial occupation.
    (22) Beginning January 1, 2000, personal property,
including food, purchased through fundraising events for the
benefit of a public or private elementary or secondary school,
a group of those schools, or one or more school districts if
the events are sponsored by an entity recognized by the school
district that consists primarily of volunteers and includes
parents and teachers of the school children. This paragraph
does not apply to fundraising events (i) for the benefit of
private home instruction or (ii) for which the fundraising
entity purchases the personal property sold at the events from
another individual or entity that sold the property for the
purpose of resale by the fundraising entity and that profits
from the sale to the fundraising entity. This paragraph is
exempt from the provisions of Section 3-55.
    (23) Beginning January 1, 2000 and through December 31,
2001, new or used automatic vending machines that prepare and
serve hot food and beverages, including coffee, soup, and other
items, and replacement parts for these machines. Beginning
January 1, 2002 and through June 30, 2003, machines and parts
for machines used in commercial, coin-operated amusement and
vending business if a use or occupation tax is paid on the
gross receipts derived from the use of the commercial,
coin-operated amusement and vending machines. This paragraph
is exempt from the provisions of Section 3-55.
    (24) Beginning on the effective date of this amendatory Act
of the 92nd General Assembly, computers and communications
equipment utilized for any hospital purpose and equipment used
in the diagnosis, analysis, or treatment of hospital patients
sold to a lessor who leases the equipment, under a lease of one
year or longer executed or in effect at the time of the
purchase, to a hospital that has been issued an active tax
exemption identification number by the Department under
Section 1g of the Retailers' Occupation Tax Act. This paragraph
is exempt from the provisions of Section 3-55.
    (25) Beginning on the effective date of this amendatory Act
of the 92nd General Assembly, personal property sold to a
lessor who leases the property, under a lease of one year or
longer executed or in effect at the time of the purchase, to a
governmental body that has been issued an active tax exemption
identification number by the Department under Section 1g of the
Retailers' Occupation Tax Act. This paragraph is exempt from
the provisions of Section 3-55.
    (26) Beginning on January 1, 2002 and through June 30,
2016, tangible personal property purchased from an Illinois
retailer by a taxpayer engaged in centralized purchasing
activities in Illinois who will, upon receipt of the property
in Illinois, temporarily store the property in Illinois (i) for
the purpose of subsequently transporting it outside this State
for use or consumption thereafter solely outside this State or
(ii) for the purpose of being processed, fabricated, or
manufactured into, attached to, or incorporated into other
tangible personal property to be transported outside this State
and thereafter used or consumed solely outside this State. The
Director of Revenue shall, pursuant to rules adopted in
accordance with the Illinois Administrative Procedure Act,
issue a permit to any taxpayer in good standing with the
Department who is eligible for the exemption under this
paragraph (26). The permit issued under this paragraph (26)
shall authorize the holder, to the extent and in the manner
specified in the rules adopted under this Act, to purchase
tangible personal property from a retailer exempt from the
taxes imposed by this Act. Taxpayers shall maintain all
necessary books and records to substantiate the use and
consumption of all such tangible personal property outside of
the State of Illinois.
    (27) Beginning January 1, 2008, tangible personal property
used in the construction or maintenance of a community water
supply, as defined under Section 3.145 of the Environmental
Protection Act, that is operated by a not-for-profit
corporation that holds a valid water supply permit issued under
Title IV of the Environmental Protection Act. This paragraph is
exempt from the provisions of Section 3-55.
    (28) Tangible personal property sold to a
public-facilities corporation, as described in Section
11-65-10 of the Illinois Municipal Code, for purposes of
constructing or furnishing a municipal convention hall, but
only if the legal title to the municipal convention hall is
transferred to the municipality without any further
consideration by or on behalf of the municipality at the time
of the completion of the municipal convention hall or upon the
retirement or redemption of any bonds or other debt instruments
issued by the public-facilities corporation in connection with
the development of the municipal convention hall. This
exemption includes existing public-facilities corporations as
provided in Section 11-65-25 of the Illinois Municipal Code.
This paragraph is exempt from the provisions of Section 3-55.
    (29) Beginning January 1, 2010, materials, parts,
equipment, components, and furnishings incorporated into or
upon an aircraft as part of the modification, refurbishment,
completion, replacement, repair, or maintenance of the
aircraft. This exemption includes consumable supplies used in
the modification, refurbishment, completion, replacement,
repair, and maintenance of aircraft, but excludes any
materials, parts, equipment, components, and consumable
supplies used in the modification, replacement, repair, and
maintenance of aircraft engines or power plants, whether such
engines or power plants are installed or uninstalled upon any
such aircraft. "Consumable supplies" include, but are not
limited to, adhesive, tape, sandpaper, general purpose
lubricants, cleaning solution, latex gloves, and protective
films. This exemption applies only to the transfer of
qualifying tangible personal property incident to the
modification, refurbishment, completion, replacement, repair,
or maintenance of an aircraft by persons who (i) hold an Air
Agency Certificate and are empowered to operate an approved
repair station by the Federal Aviation Administration, (ii)
have a Class IV Rating, and (iii) conduct operations in
accordance with Part 145 of the Federal Aviation Regulations.
The exemption does not include aircraft operated by a
commercial air carrier providing scheduled passenger air
service pursuant to authority issued under Part 121 or Part 129
of the Federal Aviation Regulations. The changes made to this
paragraph (29) by Public Act 98-534 are declarative of existing
law.
    (30) Beginning January 1, 2017, menstrual pads, tampons,
and menstrual cups.
(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
100-22, eff. 7-6-17.)
 
    Section 20. The Retailers' Occupation Tax Act is amended by
changing Section 2-5 as follows:
 
    (35 ILCS 120/2-5)
    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
sale of the following tangible personal property are exempt
from the tax imposed by this Act:
        (1) Farm chemicals.
        (2) Farm machinery and equipment, both new and used,
    including that manufactured on special order, certified by
    the purchaser to be used primarily for production
    agriculture or State or federal agricultural programs,
    including individual replacement parts for the machinery
    and equipment, including machinery and equipment purchased
    for lease, and including implements of husbandry defined in
    Section 1-130 of the Illinois Vehicle Code, farm machinery
    and agricultural chemical and fertilizer spreaders, and
    nurse wagons required to be registered under Section 3-809
    of the Illinois Vehicle Code, but excluding other motor
    vehicles required to be registered under the Illinois
    Vehicle Code. Horticultural polyhouses or hoop houses used
    for propagating, growing, or overwintering plants shall be
    considered farm machinery and equipment under this item
    (2). Agricultural chemical tender tanks and dry boxes shall
    include units sold separately from a motor vehicle required
    to be licensed and units sold mounted on a motor vehicle
    required to be licensed, if the selling price of the tender
    is separately stated.
        Farm machinery and equipment shall include precision
    farming equipment that is installed or purchased to be
    installed on farm machinery and equipment including, but
    not limited to, tractors, harvesters, sprayers, planters,
    seeders, or spreaders. Precision farming equipment
    includes, but is not limited to, soil testing sensors,
    computers, monitors, software, global positioning and
    mapping systems, and other such equipment.
        Farm machinery and equipment also includes computers,
    sensors, software, and related equipment used primarily in
    the computer-assisted operation of production agriculture
    facilities, equipment, and activities such as, but not
    limited to, the collection, monitoring, and correlation of
    animal and crop data for the purpose of formulating animal
    diets and agricultural chemicals. This item (2) is exempt
    from the provisions of Section 2-70.
        (3) Until July 1, 2003, distillation machinery and
    equipment, sold as a unit or kit, assembled or installed by
    the retailer, certified by the user to be used only for the
    production of ethyl alcohol that will be used for
    consumption as motor fuel or as a component of motor fuel
    for the personal use of the user, and not subject to sale
    or resale.
        (4) Until July 1, 2003 and beginning again September 1,
    2004 through August 30, 2014, graphic arts machinery and
    equipment, including repair and replacement parts, both
    new and used, and including that manufactured on special
    order or purchased for lease, certified by the purchaser to
    be used primarily for graphic arts production. Equipment
    includes chemicals or chemicals acting as catalysts but
    only if the chemicals or chemicals acting as catalysts
    effect a direct and immediate change upon a graphic arts
    product. Beginning on July 1, 2017, graphic arts machinery
    and equipment is included in the manufacturing and
    assembling machinery and equipment exemption under
    paragraph (14).
        (5) A motor vehicle that is used for automobile
    renting, as defined in the Automobile Renting Occupation
    and Use Tax Act. This paragraph is exempt from the
    provisions of Section 2-70.
        (6) Personal property sold by a teacher-sponsored
    student organization affiliated with an elementary or
    secondary school located in Illinois.
        (7) Until July 1, 2003, proceeds of that portion of the
    selling price of a passenger car the sale of which is
    subject to the Replacement Vehicle Tax.
        (8) Personal property sold to an Illinois county fair
    association for use in conducting, operating, or promoting
    the county fair.
        (9) Personal property sold to a not-for-profit arts or
    cultural organization that establishes, by proof required
    by the Department by rule, that it has received an
    exemption under Section 501(c)(3) of the Internal Revenue
    Code and that is organized and operated primarily for the
    presentation or support of arts or cultural programming,
    activities, or services. These organizations include, but
    are not limited to, music and dramatic arts organizations
    such as symphony orchestras and theatrical groups, arts and
    cultural service organizations, local arts councils,
    visual arts organizations, and media arts organizations.
    On and after July 1, 2001 (the effective date of Public Act
    92-35) this amendatory Act of the 92nd General Assembly,
    however, an entity otherwise eligible for this exemption
    shall not make tax-free purchases unless it has an active
    identification number issued by the Department.
        (10) Personal property sold by a corporation, society,
    association, foundation, institution, or organization,
    other than a limited liability company, that is organized
    and operated as a not-for-profit service enterprise for the
    benefit of persons 65 years of age or older if the personal
    property was not purchased by the enterprise for the
    purpose of resale by the enterprise.
        (11) Personal property sold to a governmental body, to
    a corporation, society, association, foundation, or
    institution organized and operated exclusively for
    charitable, religious, or educational purposes, or to a
    not-for-profit corporation, society, association,
    foundation, institution, or organization that has no
    compensated officers or employees and that is organized and
    operated primarily for the recreation of persons 55 years
    of age or older. A limited liability company may qualify
    for the exemption under this paragraph only if the limited
    liability company is organized and operated exclusively
    for educational purposes. On and after July 1, 1987,
    however, no entity otherwise eligible for this exemption
    shall make tax-free purchases unless it has an active
    identification number issued by the Department.
        (12) (Blank).
        (12-5) On and after July 1, 2003 and through June 30,
    2004, motor vehicles of the second division with a gross
    vehicle weight in excess of 8,000 pounds that are subject
    to the commercial distribution fee imposed under Section
    3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
    2004 and through June 30, 2005, the use in this State of
    motor vehicles of the second division: (i) with a gross
    vehicle weight rating in excess of 8,000 pounds; (ii) that
    are subject to the commercial distribution fee imposed
    under Section 3-815.1 of the Illinois Vehicle Code; and
    (iii) that are primarily used for commercial purposes.
    Through June 30, 2005, this exemption applies to repair and
    replacement parts added after the initial purchase of such
    a motor vehicle if that motor vehicle is used in a manner
    that would qualify for the rolling stock exemption
    otherwise provided for in this Act. For purposes of this
    paragraph, "used for commercial purposes" means the
    transportation of persons or property in furtherance of any
    commercial or industrial enterprise whether for-hire or
    not.
        (13) Proceeds from sales to owners, lessors, or
    shippers of tangible personal property that is utilized by
    interstate carriers for hire for use as rolling stock
    moving in interstate commerce and equipment operated by a
    telecommunications provider, licensed as a common carrier
    by the Federal Communications Commission, which is
    permanently installed in or affixed to aircraft moving in
    interstate commerce.
        (14) Machinery and equipment that will be used by the
    purchaser, or a lessee of the purchaser, primarily in the
    process of manufacturing or assembling tangible personal
    property for wholesale or retail sale or lease, whether the
    sale or lease is made directly by the manufacturer or by
    some other person, whether the materials used in the
    process are owned by the manufacturer or some other person,
    or whether the sale or lease is made apart from or as an
    incident to the seller's engaging in the service occupation
    of producing machines, tools, dies, jigs, patterns,
    gauges, or other similar items of no commercial value on
    special order for a particular purchaser. The exemption
    provided by this paragraph (14) does not include machinery
    and equipment used in (i) the generation of electricity for
    wholesale or retail sale; (ii) the generation or treatment
    of natural or artificial gas for wholesale or retail sale
    that is delivered to customers through pipes, pipelines, or
    mains; or (iii) the treatment of water for wholesale or
    retail sale that is delivered to customers through pipes,
    pipelines, or mains. The provisions of Public Act 98-583
    are declaratory of existing law as to the meaning and scope
    of this exemption. Beginning on July 1, 2017, the exemption
    provided by this paragraph (14) includes, but is not
    limited to, graphic arts machinery and equipment, as
    defined in paragraph (4) of this Section.
        (15) Proceeds of mandatory service charges separately
    stated on customers' bills for purchase and consumption of
    food and beverages, to the extent that the proceeds of the
    service charge are in fact turned over as tips or as a
    substitute for tips to the employees who participate
    directly in preparing, serving, hosting or cleaning up the
    food or beverage function with respect to which the service
    charge is imposed.
        (16) Petroleum products sold to a purchaser if the
    seller is prohibited by federal law from charging tax to
    the purchaser.
        (17) Tangible personal property sold to a common
    carrier by rail or motor that receives the physical
    possession of the property in Illinois and that transports
    the property, or shares with another common carrier in the
    transportation of the property, out of Illinois on a
    standard uniform bill of lading showing the seller of the
    property as the shipper or consignor of the property to a
    destination outside Illinois, for use outside Illinois.
        (18) Legal tender, currency, medallions, or gold or
    silver coinage issued by the State of Illinois, the
    government of the United States of America, or the
    government of any foreign country, and bullion.
        (19) Until July 1, 2003, oil field exploration,
    drilling, and production equipment, including (i) rigs and
    parts of rigs, rotary rigs, cable tool rigs, and workover
    rigs, (ii) pipe and tubular goods, including casing and
    drill strings, (iii) pumps and pump-jack units, (iv)
    storage tanks and flow lines, (v) any individual
    replacement part for oil field exploration, drilling, and
    production equipment, and (vi) machinery and equipment
    purchased for lease; but excluding motor vehicles required
    to be registered under the Illinois Vehicle Code.
        (20) Photoprocessing machinery and equipment,
    including repair and replacement parts, both new and used,
    including that manufactured on special order, certified by
    the purchaser to be used primarily for photoprocessing, and
    including photoprocessing machinery and equipment
    purchased for lease.
        (21) Until July 1, 2023, coal Coal and aggregate
    exploration, mining, off-highway hauling, processing,
    maintenance, and reclamation equipment, including
    replacement parts and equipment, and including equipment
    purchased for lease, but excluding motor vehicles required
    to be registered under the Illinois Vehicle Code. The
    changes made to this Section by Public Act 97-767 apply on
    and after July 1, 2003, but no claim for credit or refund
    is allowed on or after August 16, 2013 (the effective date
    of Public Act 98-456) for such taxes paid during the period
    beginning July 1, 2003 and ending on August 16, 2013 (the
    effective date of Public Act 98-456).
        (22) Until June 30, 2013, fuel and petroleum products
    sold to or used by an air carrier, certified by the carrier
    to be used for consumption, shipment, or storage in the
    conduct of its business as an air common carrier, for a
    flight destined for or returning from a location or
    locations outside the United States without regard to
    previous or subsequent domestic stopovers.
        Beginning July 1, 2013, fuel and petroleum products
    sold to or used by an air carrier, certified by the carrier
    to be used for consumption, shipment, or storage in the
    conduct of its business as an air common carrier, for a
    flight that (i) is engaged in foreign trade or is engaged
    in trade between the United States and any of its
    possessions and (ii) transports at least one individual or
    package for hire from the city of origination to the city
    of final destination on the same aircraft, without regard
    to a change in the flight number of that aircraft.
        (23) A transaction in which the purchase order is
    received by a florist who is located outside Illinois, but
    who has a florist located in Illinois deliver the property
    to the purchaser or the purchaser's donee in Illinois.
        (24) Fuel consumed or used in the operation of ships,
    barges, or vessels that are used primarily in or for the
    transportation of property or the conveyance of persons for
    hire on rivers bordering on this State if the fuel is
    delivered by the seller to the purchaser's barge, ship, or
    vessel while it is afloat upon that bordering river.
        (25) Except as provided in item (25-5) of this Section,
    a motor vehicle sold in this State to a nonresident even
    though the motor vehicle is delivered to the nonresident in
    this State, if the motor vehicle is not to be titled in
    this State, and if a drive-away permit is issued to the
    motor vehicle as provided in Section 3-603 of the Illinois
    Vehicle Code or if the nonresident purchaser has vehicle
    registration plates to transfer to the motor vehicle upon
    returning to his or her home state. The issuance of the
    drive-away permit or having the out-of-state registration
    plates to be transferred is prima facie evidence that the
    motor vehicle will not be titled in this State.
        (25-5) The exemption under item (25) does not apply if
    the state in which the motor vehicle will be titled does
    not allow a reciprocal exemption for a motor vehicle sold
    and delivered in that state to an Illinois resident but
    titled in Illinois. The tax collected under this Act on the
    sale of a motor vehicle in this State to a resident of
    another state that does not allow a reciprocal exemption
    shall be imposed at a rate equal to the state's rate of tax
    on taxable property in the state in which the purchaser is
    a resident, except that the tax shall not exceed the tax
    that would otherwise be imposed under this Act. At the time
    of the sale, the purchaser shall execute a statement,
    signed under penalty of perjury, of his or her intent to
    title the vehicle in the state in which the purchaser is a
    resident within 30 days after the sale and of the fact of
    the payment to the State of Illinois of tax in an amount
    equivalent to the state's rate of tax on taxable property
    in his or her state of residence and shall submit the
    statement to the appropriate tax collection agency in his
    or her state of residence. In addition, the retailer must
    retain a signed copy of the statement in his or her
    records. Nothing in this item shall be construed to require
    the removal of the vehicle from this state following the
    filing of an intent to title the vehicle in the purchaser's
    state of residence if the purchaser titles the vehicle in
    his or her state of residence within 30 days after the date
    of sale. The tax collected under this Act in accordance
    with this item (25-5) shall be proportionately distributed
    as if the tax were collected at the 6.25% general rate
    imposed under this Act.
        (25-7) Beginning on July 1, 2007, no tax is imposed
    under this Act on the sale of an aircraft, as defined in
    Section 3 of the Illinois Aeronautics Act, if all of the
    following conditions are met:
            (1) the aircraft leaves this State within 15 days
        after the later of either the issuance of the final
        billing for the sale of the aircraft, or the authorized
        approval for return to service, completion of the
        maintenance record entry, and completion of the test
        flight and ground test for inspection, as required by
        14 C.F.R. 91.407;
            (2) the aircraft is not based or registered in this
        State after the sale of the aircraft; and
            (3) the seller retains in his or her books and
        records and provides to the Department a signed and
        dated certification from the purchaser, on a form
        prescribed by the Department, certifying that the
        requirements of this item (25-7) are met. The
        certificate must also include the name and address of
        the purchaser, the address of the location where the
        aircraft is to be titled or registered, the address of
        the primary physical location of the aircraft, and
        other information that the Department may reasonably
        require.
        For purposes of this item (25-7):
        "Based in this State" means hangared, stored, or
    otherwise used, excluding post-sale customizations as
    defined in this Section, for 10 or more days in each
    12-month period immediately following the date of the sale
    of the aircraft.
        "Registered in this State" means an aircraft
    registered with the Department of Transportation,
    Aeronautics Division, or titled or registered with the
    Federal Aviation Administration to an address located in
    this State.
        This paragraph (25-7) is exempt from the provisions of
    Section 2-70.
        (26) Semen used for artificial insemination of
    livestock for direct agricultural production.
        (27) Horses, or interests in horses, registered with
    and meeting the requirements of any of the Arabian Horse
    Club Registry of America, Appaloosa Horse Club, American
    Quarter Horse Association, United States Trotting
    Association, or Jockey Club, as appropriate, used for
    purposes of breeding or racing for prizes. This item (27)
    is exempt from the provisions of Section 2-70, and the
    exemption provided for under this item (27) applies for all
    periods beginning May 30, 1995, but no claim for credit or
    refund is allowed on or after January 1, 2008 (the
    effective date of Public Act 95-88) for such taxes paid
    during the period beginning May 30, 2000 and ending on
    January 1, 2008 (the effective date of Public Act 95-88).
        (28) Computers and communications equipment utilized
    for any hospital purpose and equipment used in the
    diagnosis, analysis, or treatment of hospital patients
    sold to a lessor who leases the equipment, under a lease of
    one year or longer executed or in effect at the time of the
    purchase, to a hospital that has been issued an active tax
    exemption identification number by the Department under
    Section 1g of this Act.
        (29) Personal property sold to a lessor who leases the
    property, under a lease of one year or longer executed or
    in effect at the time of the purchase, to a governmental
    body that has been issued an active tax exemption
    identification number by the Department under Section 1g of
    this Act.
        (30) Beginning with taxable years ending on or after
    December 31, 1995 and ending with taxable years ending on
    or before December 31, 2004, personal property that is
    donated for disaster relief to be used in a State or
    federally declared disaster area in Illinois or bordering
    Illinois by a manufacturer or retailer that is registered
    in this State to a corporation, society, association,
    foundation, or institution that has been issued a sales tax
    exemption identification number by the Department that
    assists victims of the disaster who reside within the
    declared disaster area.
        (31) Beginning with taxable years ending on or after
    December 31, 1995 and ending with taxable years ending on
    or before December 31, 2004, personal property that is used
    in the performance of infrastructure repairs in this State,
    including but not limited to municipal roads and streets,
    access roads, bridges, sidewalks, waste disposal systems,
    water and sewer line extensions, water distribution and
    purification facilities, storm water drainage and
    retention facilities, and sewage treatment facilities,
    resulting from a State or federally declared disaster in
    Illinois or bordering Illinois when such repairs are
    initiated on facilities located in the declared disaster
    area within 6 months after the disaster.
        (32) Beginning July 1, 1999, game or game birds sold at
    a "game breeding and hunting preserve area" as that term is
    used in the Wildlife Code. This paragraph is exempt from
    the provisions of Section 2-70.
        (33) A motor vehicle, as that term is defined in
    Section 1-146 of the Illinois Vehicle Code, that is donated
    to a corporation, limited liability company, society,
    association, foundation, or institution that is determined
    by the Department to be organized and operated exclusively
    for educational purposes. For purposes of this exemption,
    "a corporation, limited liability company, society,
    association, foundation, or institution organized and
    operated exclusively for educational purposes" means all
    tax-supported public schools, private schools that offer
    systematic instruction in useful branches of learning by
    methods common to public schools and that compare favorably
    in their scope and intensity with the course of study
    presented in tax-supported schools, and vocational or
    technical schools or institutes organized and operated
    exclusively to provide a course of study of not less than 6
    weeks duration and designed to prepare individuals to
    follow a trade or to pursue a manual, technical,
    mechanical, industrial, business, or commercial
    occupation.
        (34) Beginning January 1, 2000, personal property,
    including food, purchased through fundraising events for
    the benefit of a public or private elementary or secondary
    school, a group of those schools, or one or more school
    districts if the events are sponsored by an entity
    recognized by the school district that consists primarily
    of volunteers and includes parents and teachers of the
    school children. This paragraph does not apply to
    fundraising events (i) for the benefit of private home
    instruction or (ii) for which the fundraising entity
    purchases the personal property sold at the events from
    another individual or entity that sold the property for the
    purpose of resale by the fundraising entity and that
    profits from the sale to the fundraising entity. This
    paragraph is exempt from the provisions of Section 2-70.
        (35) Beginning January 1, 2000 and through December 31,
    2001, new or used automatic vending machines that prepare
    and serve hot food and beverages, including coffee, soup,
    and other items, and replacement parts for these machines.
    Beginning January 1, 2002 and through June 30, 2003,
    machines and parts for machines used in commercial,
    coin-operated amusement and vending business if a use or
    occupation tax is paid on the gross receipts derived from
    the use of the commercial, coin-operated amusement and
    vending machines. This paragraph is exempt from the
    provisions of Section 2-70.
        (35-5) Beginning August 23, 2001 and through June 30,
    2016, food for human consumption that is to be consumed off
    the premises where it is sold (other than alcoholic
    beverages, soft drinks, and food that has been prepared for
    immediate consumption) and prescription and
    nonprescription medicines, drugs, medical appliances, and
    insulin, urine testing materials, syringes, and needles
    used by diabetics, for human use, when purchased for use by
    a person receiving medical assistance under Article V of
    the Illinois Public Aid Code who resides in a licensed
    long-term care facility, as defined in the Nursing Home
    Care Act, or a licensed facility as defined in the ID/DD
    Community Care Act, the MC/DD Act, or the Specialized
    Mental Health Rehabilitation Act of 2013.
        (36) Beginning August 2, 2001, computers and
    communications equipment utilized for any hospital purpose
    and equipment used in the diagnosis, analysis, or treatment
    of hospital patients sold to a lessor who leases the
    equipment, under a lease of one year or longer executed or
    in effect at the time of the purchase, to a hospital that
    has been issued an active tax exemption identification
    number by the Department under Section 1g of this Act. This
    paragraph is exempt from the provisions of Section 2-70.
        (37) Beginning August 2, 2001, personal property sold
    to a lessor who leases the property, under a lease of one
    year or longer executed or in effect at the time of the
    purchase, to a governmental body that has been issued an
    active tax exemption identification number by the
    Department under Section 1g of this Act. This paragraph is
    exempt from the provisions of Section 2-70.
        (38) Beginning on January 1, 2002 and through June 30,
    2016, tangible personal property purchased from an
    Illinois retailer by a taxpayer engaged in centralized
    purchasing activities in Illinois who will, upon receipt of
    the property in Illinois, temporarily store the property in
    Illinois (i) for the purpose of subsequently transporting
    it outside this State for use or consumption thereafter
    solely outside this State or (ii) for the purpose of being
    processed, fabricated, or manufactured into, attached to,
    or incorporated into other tangible personal property to be
    transported outside this State and thereafter used or
    consumed solely outside this State. The Director of Revenue
    shall, pursuant to rules adopted in accordance with the
    Illinois Administrative Procedure Act, issue a permit to
    any taxpayer in good standing with the Department who is
    eligible for the exemption under this paragraph (38). The
    permit issued under this paragraph (38) shall authorize the
    holder, to the extent and in the manner specified in the
    rules adopted under this Act, to purchase tangible personal
    property from a retailer exempt from the taxes imposed by
    this Act. Taxpayers shall maintain all necessary books and
    records to substantiate the use and consumption of all such
    tangible personal property outside of the State of
    Illinois.
        (39) Beginning January 1, 2008, tangible personal
    property used in the construction or maintenance of a
    community water supply, as defined under Section 3.145 of
    the Environmental Protection Act, that is operated by a
    not-for-profit corporation that holds a valid water supply
    permit issued under Title IV of the Environmental
    Protection Act. This paragraph is exempt from the
    provisions of Section 2-70.
        (40) Beginning January 1, 2010, materials, parts,
    equipment, components, and furnishings incorporated into
    or upon an aircraft as part of the modification,
    refurbishment, completion, replacement, repair, or
    maintenance of the aircraft. This exemption includes
    consumable supplies used in the modification,
    refurbishment, completion, replacement, repair, and
    maintenance of aircraft, but excludes any materials,
    parts, equipment, components, and consumable supplies used
    in the modification, replacement, repair, and maintenance
    of aircraft engines or power plants, whether such engines
    or power plants are installed or uninstalled upon any such
    aircraft. "Consumable supplies" include, but are not
    limited to, adhesive, tape, sandpaper, general purpose
    lubricants, cleaning solution, latex gloves, and
    protective films. This exemption applies only to the sale
    of qualifying tangible personal property to persons who
    modify, refurbish, complete, replace, or maintain an
    aircraft and who (i) hold an Air Agency Certificate and are
    empowered to operate an approved repair station by the
    Federal Aviation Administration, (ii) have a Class IV
    Rating, and (iii) conduct operations in accordance with
    Part 145 of the Federal Aviation Regulations. The exemption
    does not include aircraft operated by a commercial air
    carrier providing scheduled passenger air service pursuant
    to authority issued under Part 121 or Part 129 of the
    Federal Aviation Regulations. The changes made to this
    paragraph (40) by Public Act 98-534 are declarative of
    existing law.
        (41) Tangible personal property sold to a
    public-facilities corporation, as described in Section
    11-65-10 of the Illinois Municipal Code, for purposes of
    constructing or furnishing a municipal convention hall,
    but only if the legal title to the municipal convention
    hall is transferred to the municipality without any further
    consideration by or on behalf of the municipality at the
    time of the completion of the municipal convention hall or
    upon the retirement or redemption of any bonds or other
    debt instruments issued by the public-facilities
    corporation in connection with the development of the
    municipal convention hall. This exemption includes
    existing public-facilities corporations as provided in
    Section 11-65-25 of the Illinois Municipal Code. This
    paragraph is exempt from the provisions of Section 2-70.
        (42) Beginning January 1, 2017, menstrual pads,
    tampons, and menstrual cups.
        (43) Merchandise that is subject to the Rental Purchase
    Agreement Occupation and Use Tax. The purchaser must
    certify that the item is purchased to be rented subject to
    a rental purchase agreement, as defined in the Rental
    Purchase Agreement Act, and provide proof of registration
    under the Rental Purchase Agreement Occupation and Use Tax
    Act. This paragraph is exempt from the provisions of
    Section 2-70.
(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
100-22, eff. 7-6-17; 100-321, eff. 8-24-17; 100-437, eff.
1-1-18; revised 9-26-17.)
 
    Section 99. Effective date. This Act takes effect upon
becoming law.