Public Act 100-0940
 
SB3141 EnrolledLRB100 20670 HLH 36122 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
11 as follows:
 
    (35 ILCS 105/11)  (from Ch. 120, par. 439.11)
    Sec. 11. Every retailer required or authorized to collect
taxes hereunder and every person using in this State tangible
personal property purchased at retail from a retailer on or
after the effective date hereof shall keep such records,
receipts, invoices and other pertinent books, documents,
memoranda and papers as the Department shall require, in such
form as the Department shall require. The Department may adopt
rules that establish requirements, including record forms and
formats, for records required to be kept and maintained by
taxpayers. For purposes of this Section, "records" means all
data maintained by the taxpayer, including data on paper,
microfilm, microfiche or any type of machine-sensible data
compilation. For the purpose of administering and enforcing the
provisions hereof, the Department, or any officer or employee
of the Department designated, in writing, by the Director
thereof, may hold investigations and hearings concerning any
matters covered herein and may examine any books, papers,
records, documents or memoranda of any retailer or purchaser
bearing upon the sales or purchases of tangible personal
property, the privilege of using which is taxed hereunder, and
may require the attendance of such person or any officer or
employee of such person, or of any person having knowledge of
the facts, and may take testimony and require proof for its
information.
    Any person who fails to keep books and records or fails to
produce books and records for examination, as required by this
Section and the rules adopted by the Department, is liable to
pay to the Department, for deposit into the Tax Compliance and
Administration Fund, a penalty of $1,000 for the first failure
to keep books and records or produce books and records for
examination and a penalty of $3,000 for each subsequent failure
to keep books and records or produce books and records for
examination as required by this Section and the rules adopted
by the Department. The penalties imposed under this Section
shall not apply if the taxpayer shows that he or she acted with
ordinary business care and prudence. The Department may adopt
rules to administer the penalties under this Section.
(Source: P.A. 88-480.)
 
    Section 10. The Service Use Tax Act is amended by changing
Section 11 as follows:
 
    (35 ILCS 110/11)  (from Ch. 120, par. 439.41)
    Sec. 11. Every serviceman required or authorized to collect
taxes hereunder and every user who is subject to the tax
imposed by this Act shall keep such records, receipts, invoices
and other pertinent books, documents, memoranda and papers as
the Department shall require, in such form as the Department
shall require. The Department may adopt rules that establish
requirements, including record forms and formats, for records
required to be kept and maintained by taxpayers. For purposes
of this Section, "records" means all data maintained by the
taxpayer, including data on paper, microfilm, microfiche or any
type of machine-sensible data compilation. For the purpose of
administering and enforcing the provisions hereof, the
Department, or any officer or employee of the Department
designated, in writing, by the Director thereof, may hold
investigations and hearings concerning any matters covered
herein and not otherwise delegated to the Illinois Independent
Tax Tribunal and may examine any relevant books, papers,
records, documents or memoranda of any serviceman or any
taxable purchaser for use hereunder, and may require the
attendance of such person or any officer or employee of such
person, or of any person having knowledge of the facts, and may
take testimony and require proof for its information.
    Any person who fails to keep books and records or fails to
produce books and records for examination, as required by this
Section and the rules adopted by the Department, is liable to
pay to the Department, for deposit into the Tax Compliance and
Administration Fund, a penalty of $1,000 for the first failure
to keep books and records or produce books and records for
examination and a penalty of $3,000 for each subsequent failure
to keep books and records or produce books and records for
examination as required by this Section and the rules adopted
by the Department. The penalties imposed under this Section
shall not apply if the taxpayer shows that he or she acted with
ordinary business care and prudence. The Department may adopt
rules to administer the penalties under this Section.
(Source: P.A. 97-1129, eff. 8-28-12.)
 
    Section 15. The Service Occupation Tax Act is amended by
changing Section 11 as follows:
 
    (35 ILCS 115/11)  (from Ch. 120, par. 439.111)
    Sec. 11. Every supplier required or authorized to collect
taxes hereunder and every serviceman making sales of service in
this State on or after the effective date hereof shall keep
such records, receipts, invoices and other pertinent books,
documents, memoranda and papers as the Department shall
require, in such form as the Department shall require. The
Department may adopt rules that establish requirements,
including record forms and formats, for records required to be
kept and maintained by taxpayers. For purposes of this Section,
"records" means all data maintained by the taxpayer, including
data on paper, microfilm, microfiche or any type of
machine-sensible data compilation. For the purpose of
administering and enforcing the provisions hereof, the
Department, or any officer or employee of the Department
designated, in writing, by the Director thereof, may hold
investigations and hearings not otherwise delegated to the
Illinois Independent Tax Tribunal concerning any matters
covered herein and may examine any books, papers, records,
documents or memoranda of any supplier or serviceman bearing
upon the sales of services or the sales of tangible personal
property to servicemen, and may require the attendance of such
person or any officer or employee of such person, or of any
person having knowledge of the facts, and may take testimony
and require proof for its information.
    Any person who fails to keep books and records or fails to
produce books and records for examination, as required by this
Section and the rules adopted by the Department, is liable to
pay to the Department, for deposit into the Tax Compliance and
Administration Fund, a penalty of $1,000 for the first failure
to keep books and records or produce books and records for
examination and a penalty of $3,000 for each subsequent failure
to keep books and records or produce books and records for
examination as required by this Section and the rules adopted
by the Department. The penalties imposed under this Section
shall not apply if the taxpayer shows that he or she acted with
ordinary business care and prudence. The Department may adopt
rules to administer the penalties under this Section.
(Source: P.A. 97-1129, eff. 8-28-12.)
 
    Section 20. The Retailers' Occupation Tax Act is amended by
changing Section 7 as follows:
 
    (35 ILCS 120/7)  (from Ch. 120, par. 446)
    Sec. 7. Every person engaged in the business of selling
tangible personal property at retail in this State shall keep
records and books of all sales of tangible personal property,
together with invoices, bills of lading, sales records, copies
of bills of sale, inventories prepared as of December 31 of
each year or otherwise annually as has been the custom in the
specific trade and other pertinent papers and documents. Every
person who is engaged in the business of selling tangible
personal property at retail in this State and who, in
connection with such business, also engages in other activities
(including, but not limited to, engaging in a service
occupation) shall keep such additional records and books of all
such activities as will accurately reflect the character and
scope of such activities and the amount of receipts realized
therefrom. The Department may adopt rules that establish
requirements, including record forms and formats, for records
required to be kept and maintained by taxpayers. For purposes
of this Section, "records" means all data maintained by the
taxpayer, including data on paper, microfilm, microfiche or any
type of machine-sensible data compilation.
    All books and records and other papers and documents which
are required by this Act to be kept shall be kept in the
English language and shall, at all times during business hours
of the day, be subject to inspection by the Department or its
duly authorized agents and employees.
    To support deductions made on the tax return form, or
authorized under this Act, on account of receipts from isolated
or occasional sales of tangible personal property, on account
of receipts from sales of tangible personal property for
resale, on account of receipts from sales to governmental
bodies or other exempted types of purchasers, on account of
receipts from sales of tangible personal property in interstate
commerce, and on account of receipts from any other kind of
transaction that is not taxable under this Act, entries in any
books, records or other pertinent papers or documents of the
taxpayer in relation thereto shall be in detail sufficient to
show the name and address of the taxpayer's customer in each
such transaction, the character of every such transaction, the
date of every such transaction, the amount of receipts realized
from every such transaction and such other information as may
be necessary to establish the non-taxable character of such
transaction under this Act.
    Except in the case of a sale to a purchaser who will always
resell and deliver the property to his customers outside
Illinois, anyone claiming that he has made a nontaxable sale
for resale in some form as tangible personal property shall
also keep a record of the purchaser's registration number or
resale number with the Department.
    It shall be presumed that all sales of tangible personal
property are subject to tax under this Act until the contrary
is established, and the burden of proving that a transaction is
not taxable hereunder shall be upon the person who would be
required to remit the tax to the Department if such transaction
is taxable. In the course of any audit or investigation or
hearing by the Department with reference to a given taxpayer,
if the Department finds that the taxpayer lacks documentary
evidence needed to support the taxpayer's claim to exemption
from tax hereunder, the Department is authorized to notify the
taxpayer in writing to produce such evidence, and the taxpayer
shall have 60 days subject to the right in the Department to
extend this period either on request for good cause shown or on
its own motion from the date when such notice is sent to the
taxpayer by certified or registered mail (or delivered to the
taxpayer if the notice is served personally) in which to obtain
and produce such evidence for the Department's inspection,
failing which the matter shall be closed, and the transaction
shall be conclusively presumed to be taxable hereunder.
    Books and records and other papers reflecting gross
receipts received during any period with respect to which the
Department is authorized to issue notices of tax liability as
provided by Sections 4 and 5 of this Act shall be preserved
until the expiration of such period unless the Department, in
writing, shall authorize their destruction or disposal prior to
such expiration.
    Any person who fails to keep books and records or fails to
produce books and records for examination, as required by this
Section and the rules adopted by the Department, is liable to
pay to the Department, for deposit into the Tax Compliance and
Administration Fund, a penalty of $1,000 for the first failure
to keep books and records or produce books and records for
examination and a penalty of $3,000 for each subsequent failure
to keep books and records or produce books and records for
examination as required by this Section and the rules adopted
by the Department. The penalties imposed under this Section
shall not apply if the taxpayer shows that he or she acted with
ordinary business care and prudence. The Department may adopt
rules to administer the penalties under this Section.
(Source: P.A. 88-480.)
 
    Section 25. The Cigarette Tax Act is amended by changing
Sections 12, 13, 14, 15, 18b, and 18c and by adding Sections
13a, 15a, and 18d as follows:
 
    (35 ILCS 130/12)  (from Ch. 120, par. 453.12)
    Sec. 12. Every distributor or secondary distributor who is
required to procure a license under this Act and who purchases
cigarettes for shipment into Illinois from a point outside this
State shall procure invoices in duplicate covering each such
shipment, shall make the invoices available for inspection upon
demand by a duly authorized employee of the Department, and
shall, if the Department so requires, furnish one copy of each
such invoice to the Department at the time of filing a return
or a report required by this Act.
(Source: P.A. 96-1027, eff. 7-12-10.)
 
    (35 ILCS 130/13)  (from Ch. 120, par. 453.13)
    Sec. 13. Whenever any original package of cigarettes is
found in the place of business or in the possession of any
person who is not a licensed distributor under this Act without
proper stamps affixed thereto, or an authorized substitute
therefor imprinted thereon, underneath the sealed transparent
wrapper of such original package, as required by this Act, the
prima facie presumption shall arise that such original package
of cigarettes is kept therein or is held by such person in
violation of the provisions of this Act. If a presumption is
raised, the Department may, in addition to the penalties
imposed by Sections 18b and 18c of this Act and any other civil
or criminal penalties provided for in this Act, assess tax,
penalty, and interest on the original packages of cigarettes.
(Source: Laws 1953, p. 255.)
 
    (35 ILCS 130/13a new)
    Sec. 13a. Contraband cigarettes. Whenever a retailer
obtains original packages of cigarettes from an unlicensed
in-state or out-of-state distributor or person, a prima facie
presumption shall arise that such original packages of
cigarettes are contraband and are possessed by such retailer or
were possessed by such retailer in violation of the provisions
of this Act and subject to the penalties imposed by Sections
18b and 18c of this Act. Invoices or other documents kept in
the normal course of business in the possession of a retailer
reflecting purchases of original packages of cigarettes from an
unlicensed in-state or out-of-state distributor or person or
invoices or other documents kept in the normal course of
business obtained by the Department from an in-state or
out-of-state distributor or person, are sufficient to raise the
presumption that such original packages of cigarettes are
contraband and are possessed, or were possessed, by such
retailer in violation of the provisions of this Act and the
retailer is subject to the penalties imposed by Sections 18b
and 18c. If a presumption is raised, the Department may, in
addition to the penalties imposed by Sections 18b and 18c and
any other civil or criminal penalties provided for in this Act,
assess tax, penalty, and interest on the original packages of
cigarettes.
 
    (35 ILCS 130/14)  (from Ch. 120, par. 453.14)
    Sec. 14. Any person required by this Act to keep records of
any kind whatsoever, who shall fail to keep the records so
required or who shall falsify such records, shall be guilty of
a Class 4 felony. If a person fails to produce the records for
inspection by the Department upon request, a prima facie
presumption shall arise that the person has failed to keep the
records so required. A person who is unable to rebut this
presumption is in violation of this Act and is subject to the
penalties provided in this Section.
(Source: P.A. 83-1428.)
 
    (35 ILCS 130/15)  (from Ch. 120, par. 453.15)
    Sec. 15. Any person who shall fail to safely maintain and
preserve the records required by Sections Section 11, and
Section 11a, 11b, and 11c of this Act for the period of 3 three
years, as required therein, in such manner as to insure
permanency and accessibility for inspection by the Department,
shall be guilty of a business offense and may be fined up to
$5,000.
(Source: P.A. 96-1027, eff. 7-12-10.)
 
    (35 ILCS 130/15a new)
    Sec. 15a. Failure to keep or produce books and records. Any
person who fails to keep books and records or fails to produce
books and records for inspection, as required by Sections 11,
11a, 11b, and 11c of this Act, is liable to pay to the
Department, for deposit in the Tax Compliance and
Administration Fund, a penalty of $1,000 for the first failure
to keep books and records or failure to produce books and
records for inspection, as required by Sections 11, 11a, 11b,
and 11c, and $3,000 for each subsequent failure to keep books
and records or failure to produce books and records for
inspection, as required by Sections 11, 11a, 11b, and 11c. The
Department may adopt rules to administer the penalties under
this Section.
 
    (35 ILCS 130/18b)  (from Ch. 120, par. 453.18b)
    Sec. 18b. Possession of more than 100 original packages of
contraband cigarettes; penalty. With the exception of licensed
distributors and transporters, as defined in Section 9c of this
Act, possessing unstamped original packages of cigarettes, and
licensed distributors possessing original packages of
cigarettes that bear a tax stamp of another state or taxing
jurisdiction, anyone possessing or having possessed contraband
cigarettes contained in original packages is liable to pay, to
the Department for deposit in the Tax Compliance and
Administration Fund, a penalty of $25 for each such package of
cigarettes in excess of 100 packages, unless reasonable cause
can be established by the person upon whom the penalty is
imposed. This penalty is in addition to the taxes imposed by
this Act. Reasonable cause shall be determined in each
situation in accordance with rules adopted by the Department.
The provisions of the Uniform Penalty and Interest Act do not
apply to this Section.
(Source: P.A. 96-782, eff. 1-1-10.)
 
    (35 ILCS 130/18c)
    Sec. 18c. Possession of not less than 10 and not more than
100 original packages of contraband cigarettes; penalty. With
the exception of licensed distributors and transporters, as
defined in Section 9c of this Act, possessing unstamped
original packages of cigarettes, and licensed distributors
possessing original packages of cigarettes that bear a tax
stamp of another state or taxing jurisdiction, anyone
possessing or having possessed not less than 10 and not more
than 100 packages of contraband cigarettes contained in
original packages is liable to pay to the Department, for
deposit into the Tax Compliance and Administration Fund, a
penalty of $15 $10 for each such package of cigarettes, unless
reasonable cause can be established by the person upon whom the
penalty is imposed. Reasonable cause shall be determined in
each situation in accordance with rules adopted by the
Department. The provisions of the Uniform Penalty and Interest
Act do not apply to this Section.
(Source: P.A. 96-782, eff. 1-1-10.)
 
    (35 ILCS 130/18d new)
    Sec. 18d. Cigarette package sizes; sale of individual or
loose cigarettes prohibited. Cigarettes may only be sold in
packages of 20 or 25 cigarettes. The sale of individual or
loose cigarettes is prohibited. Any person who violates this
Section of the Act is liable to pay to the Department, for
deposit in the Tax Compliance and Administration Fund, a
penalty of $1,000 for the first violation and $3,000 for any
subsequent violation. Any person who violates this Section
shall be guilty of a Class 4 felony. The Department may adopt
rules to administer the penalties under this Section.
 
    Section 30. The Cigarette Use Tax Act is amended by
changing Sections 12, 22, 23, 25a, and 25b and by adding
Sections 8a, 23a, and 25c as follows:
 
    (35 ILCS 135/8a new)
    Sec. 8a. Contraband cigarettes. Whenever any person
obtains original packages of cigarettes from an unlicensed
in-state or out-of-state distributor or person, a prima facie
presumption shall arise that such original packages of
cigarettes are contraband and are possessed or were possessed
by such person in violation of the provisions of this Act and
subject to the penalties imposed by Sections 25a and 25b.
Invoices or other documents kept in the normal course of
business in the possession of a person reflecting purchases of
original packages of cigarettes from an unlicensed in-state or
out-of-state distributor or person or invoices or other
documents kept in the normal course of business obtained by the
Department from an in-state or out-of-state distributor or
person, are sufficient to raise the presumption that such
original packages of cigarettes are contraband and are
possessed, or were possessed, by such person in violation of
the provisions of this Act and the person is subject to the
penalties imposed by Sections 25a and 25b. If a presumption is
raised, the Department may, in addition to the penalties
imposed by Sections 25a and 25b and any other civil or criminal
penalties provided for in this Act, assess tax, penalty, and
interest on the original packages of cigarettes.
 
    (35 ILCS 135/12)  (from Ch. 120, par. 453.42)
    Sec. 12. Declaration of possession of cigarettes on which
tax not paid.
    (a) When cigarettes are acquired for use in this State by a
person (including a distributor as well as any other person),
who did not pay the tax herein imposed to a distributor, the
person, within 30 days after acquiring the cigarettes, shall
file with the Department a return declaring the possession of
the cigarettes and shall transmit with the return to the
Department the tax imposed by this Act.
    (b) On receipt of the return and payment of the tax as
required by paragraph (a), the Department may furnish the
person with a suitable tax stamp to be affixed to the package
of cigarettes upon which the tax has been paid if the
Department determines that the cigarettes still exist.
    (c) The return referred to in paragraph (a) shall contain
the name and address of the person possessing the cigarettes
involved, the location of the cigarettes and the quantity,
brand name, place, and date of the acquisition of the
cigarettes.
    (d) Nothing in this Section shall permit a secondary
distributor to purchase unstamped original packages of
cigarettes or to purchase original packages of cigarettes from
a person other than a licensed distributor.
    (e) Any distributor who violates this Section is liable to
pay to the Department, for deposit in the Tax Compliance and
Administration Fund, a penalty of $1,000 for the first
violation and $3,000 for any subsequent violation. The
Department may adopt rules to administer the penalties under
this Section. The Department may, in addition to the penalties
imposed by this Section, and any other civil or criminal
penalties provided for in this Act, assess tax, penalty, and
interest on the original packages of cigarettes.
(Source: P.A. 96-1027, eff. 7-12-10.)
 
    (35 ILCS 135/22)  (from Ch. 120, par. 453.52)
    Sec. 22. Any person required by this Act to maintain or
keep records of any kind whatsoever, who shall fail to keep the
records so required or who shall falsify such records, shall be
guilty of a Class 4 felony A misdemeanor. If a person fails to
produce the records for inspection by the Department upon
request, a prima facie presumption shall arise that the person
has failed to keep the records so required. A person who is
unable to rebut this presumption is in violation of this Act
and is subject to the penalties provided in this Section.
    This Section shall not apply if the violation in a
particular case also constitutes a criminal violation of the
Cigarette Tax Act.
(Source: P.A. 77-2229.)
 
    (35 ILCS 135/23)  (from Ch. 120, par. 453.53)
    Sec. 23. Any person who shall fail to safely preserve the
records required by Section 15 and Section 15a of this Act for
the period of three (3) years, as required therein, in such
manner as to insure permanency and accessibility for inspection
by the Department, shall be guilty of a business offense and
may be fined up to $5,000 One Thousand Dollars ($1000).
    This Section shall not apply if the violation in a
particular case also constitutes a criminal violation of the
Cigarette Tax Act.
(Source: P.A. 96-1027, eff. 7-12-10.)
 
    (35 ILCS 135/23a new)
    Sec. 23a. Failure to keep or produce books and records. Any
person who fails to keep books and records or fails to produce
books and records for inspection, as required by Sections 15
and 15a of this Act, is liable to pay to the Department, for
deposit in the Tax Compliance and Administration Fund, a
penalty of $1,000 for the first failure to keep books and
records or failure to produce books and records for inspection,
as required by Sections 15 and 15a, and $3,000 for each
subsequent failure to keep books and records or failure to
produce books and records for inspection, as required by
Sections 15 and 15a. The Department may adopt rules to
administer the penalties under this Section.
 
    (35 ILCS 135/25a)  (from Ch. 120, par. 453.55a)
    Sec. 25a. Possession of more than 100 original packages of
contraband cigarettes; penalty. With the exception of licensed
distributors or transporters, as defined in Section 9c of the
Cigarette Tax Act, possessing unstamped original packages of
cigarettes, and licensed distributors possessing original
packages of cigarettes that bear a tax stamp of another state
or taxing jurisdiction, anyone possessing or having possessed
more than 100 packages of contraband cigarettes contained in
original packages is liable to pay, to the Department for
deposit into the Tax Compliance and Administration Fund, a
penalty of $25 for each such package of cigarettes in excess of
100 packages, unless reasonable cause can be established by the
person upon whom the penalty is imposed. Reasonable cause shall
be determined in each situation in accordance with rules
adopted by the Department. The provisions of the Uniform
Penalty and Interest Act do not apply to this Section.
(Source: P.A. 96-782, eff. 1-1-10.)
 
    (35 ILCS 135/25b)
    Sec. 25b. Possession of not less than 10 and not more than
100 original packages not tax stamped or improperly tax
stamped; penalty. With the exception of licensed distributors
and transporters, as defined in Section 9c of the Cigarette Tax
Act, possessing unstamped packages of cigarettes, and licensed
distributors possessing original packages of cigarettes that
bear a tax stamp of another state or taxing jurisdiction,
anyone possessing or having possessed not less than 10 and not
more than 100 packages of contraband cigarettes contained in
original packages is liable to pay to the Department, for
deposit into the Tax Compliance and Administration Fund, a
penalty of $20 for each such package of cigarettes, unless
reasonable cause can be established by the person upon whom the
penalty is imposed. Reasonable cause shall be determined in
each situation in accordance with rules adopted by the
Department. Any person who purchases and possesses a total of 9
or fewer original packages of unstamped cigarettes per month is
exempt from the penalties of this Section. The provisions of
the Uniform Penalty and Interest Act do not apply to this
Section.
(Source: P.A. 96-782, eff. 1-1-10.)
 
    (35 ILCS 135/25c new)
    Sec. 25c. Cigarette package sizes; sale of individual or
loose cigarettes prohibited. Cigarettes may only be sold in
packages of 20 or 25 cigarettes. The sale of individual or
loose cigarettes is prohibited. Any person who violates this
Section is liable to pay to the Department, for deposit in the
Tax Compliance and Administration Fund, a penalty of $1,000 for
the first violation and $3,000 for any subsequent violation.
Any person who violates this Section shall be guilty of a Class
4 felony. This Section shall not apply if the violation in a
particular case also constitutes a violation of the Cigarette
Tax Act.
 
    Section 35. The Tobacco Products Tax Act of 1995 is amended
by changing Sections 10-25, 10-35, 10-37, 10-40, and 10-50 and
by adding Sections 10-35a and 10-38 as follows:
 
    (35 ILCS 143/10-25)
    Sec. 10-25. License actions.
    (a) The Department may, after notice and a hearing, revoke,
cancel, or suspend the license of any distributor or retailer
who violates any of the provisions of this Act, fails to keep
books and records as required under this Act, fails to make
books and records available for inspection upon demand by a
duly authorized employee of the Department, or violates a rule
or regulation of the Department for the administration and
enforcement of this Act. The notice shall specify the alleged
violation or violations upon which the revocation,
cancellation, or suspension proceeding is based.
    (b) The Department may revoke, cancel, or suspend the
license of any distributor for a violation of the Tobacco
Product Manufacturers' Escrow Enforcement Act as provided in
Section 20 of that Act.
    (c) If the retailer has a training program that facilitates
compliance with minimum-age tobacco laws, the Department shall
suspend for 3 days the license of that retailer for a fourth or
subsequent violation of the Prevention of Tobacco Use by Minors
and Sale and Distribution of Tobacco Products Act, as provided
in subsection (a) of Section 2 of that Act. For the purposes of
this Section, any violation of subsection (a) of Section 2 of
the Prevention of Tobacco Use by Minors and Sale and
Distribution of Tobacco Products Act occurring at the
retailer's licensed location, during a 24-month period, shall
be counted as a violation against the retailer.
    If the retailer does not have a training program that
facilitates compliance with minimum-age tobacco laws, the
Department shall suspend for 3 days the license of that
retailer for a second violation of the Prevention of Tobacco
Use by Minors and Sale and Distribution of Tobacco Products
Act, as provided in subsection (a-5) of Section 2 of that Act.
    If the retailer does not have a training program that
facilitates compliance with minimum-age tobacco laws, the
Department shall suspend for 7 days the license of that
retailer for a third violation of the Prevention of Tobacco Use
by Minors and Sale and Distribution of Tobacco Products Act, as
provided in subsection (a-5) of Section 2 of that Act.
    If the retailer does not have a training program that
facilitates compliance with minimum-age tobacco laws, the
Department shall suspend for 30 days the license of a retailer
for a fourth or subsequent violation of the Prevention of
Tobacco Use by Minors and Sale and Distribution of Tobacco
Products Act, as provided in subsection (a-5) of Section 2 of
that Act.
    A training program that facilitates compliance with
minimum-age tobacco laws must include at least the following
elements: (i) it must explain that only individuals displaying
valid identification demonstrating that they are 18 years of
age or older shall be eligible to purchase cigarettes or
tobacco products and (ii) it must explain where a clerk can
check identification for a date of birth. The training may be
conducted electronically. Each retailer that has a training
program shall require each employee who completes the training
program to sign a form attesting that the employee has received
and completed tobacco training. The form shall be kept in the
employee's file and may be used to provide proof of training.
    (d) The Department may, by application to any circuit
court, obtain an injunction restraining any person who engages
in business as a distributor of tobacco products without a
license (either because his or her license has been revoked,
canceled, or suspended or because of a failure to obtain a
license in the first instance) from engaging in that business
until that person, as if that person were a new applicant for a
license, complies with all of the conditions, restrictions, and
requirements of Section 10-20 of this Act and qualifies for and
obtains a license. Refusal or neglect to obey the order of the
court may result in punishment for contempt.
(Source: P.A. 98-1055, eff. 1-1-16; 99-192, eff. 1-1-16.)
 
    (35 ILCS 143/10-35)
    Sec. 10-35. Record keeping.
    (a) Every distributor, as defined in Section 10-5, shall
keep complete and accurate records of tobacco products held,
purchased, manufactured, brought in or caused to be brought in
from without the State, and tobacco products sold, or otherwise
disposed of, and shall preserve and keep all invoices, bills of
lading, sales records, and copies of bills of sale, the
wholesale price for tobacco products sold or otherwise disposed
of, an inventory of tobacco products prepared as of December 31
of each year or as of the last day of the distributor's fiscal
year if he or she files federal income tax returns on the basis
of a fiscal year, and other pertinent papers and documents
relating to the manufacture, purchase, sale, or disposition of
tobacco products. Every sales invoice issued by a licensed
distributor to a retailer in this State shall contain the
distributor's Tobacco Products License number unless the
distributor has been granted a waiver by the Department in
response to a written request in cases where (i) the
distributor sells little cigars or other tobacco products only
to licensed retailers that are wholly-owned by the distributor
or owned by a wholly-owned subsidiary of the distributor; (ii)
the licensed retailer obtains little cigars or other tobacco
products only from the distributor requesting the waiver; and
(iii) the distributor affixes the tax stamps to the original
packages of little cigars or has or will pay the tax on the
other tobacco products sold to the licensed retailer. The
distributor shall file a written request with the Department,
and, if the Department determines that the distributor meets
the conditions for a waiver, the Department shall grant the
waiver.
    (b) Every retailer, as defined in Section 10-5, whether or
not the retailer has obtained a retailer's license pursuant to
Section 4g, shall keep complete and accurate records of tobacco
products held, purchased, sold, or otherwise disposed of, and
shall preserve and keep all invoices, bills of lading, sales
records, and copies of bills of sale, returns and other
pertinent papers and documents relating to the purchase, sale,
or disposition of tobacco products. Such records need not be
maintained on the licensed premises, but must be maintained in
the State of Illinois; however, if access is available
electronically, the records may be maintained out of state.
However, all original invoices or copies thereof covering
purchases of tobacco products must be retained on the licensed
premises for a period of 90 days after such purchase, unless
the Department has granted a waiver in response to a written
request in cases where records are kept at a central business
location within the State of Illinois or in cases where records
that are available electronically are maintained out of state.
The Department shall adopt rules regarding the eligibility for
a waiver, revocation of a waiver, and requirements and
standards for maintenance and accessibility of records located
at a central location out-of-State pursuant to a waiver
provided under this Section.
    (c) Books, records, papers, and documents that are required
by this Act to be kept shall, at all times during the usual
business hours of the day, be subject to inspection by the
Department or its duly authorized agents and employees. The
books, records, papers, and documents for any period with
respect to which the Department is authorized to issue a notice
of tax liability shall be preserved until the expiration of
that period.
(Source: P.A. 98-1055, eff. 1-1-16; 99-192, eff. 1-1-16.)
 
    (35 ILCS 143/10-35a new)
    Sec. 10-35a. Failure to keep or produce books and records.
Any person who fails to keep books and records or fails to
produce books and records for inspection, as required by
Section 10-35, is liable to pay to the Department, for deposit
in the Tax Compliance and Administration Fund, a penalty of
$1,000 for the first failure to keep books and records or
failure to produce books and records for inspection, as
required by Section 10-35, and $3,000 for each subsequent
failure to keep books and records or failure to produce books
and records for inspection, as required by Section 10-35. The
Department may adopt rules to administer the penalties under
this Section.
 
    (35 ILCS 143/10-37)
    Sec. 10-37. Proof of payment of tax imposed by this Act.
Every licensed distributor of tobacco products in this State is
required to show proof of the tax having been paid as required
by this Act by displaying its Tobacco Products License number
on every sales invoice issued to a retailer in this State. No
retailer shall possess tobacco products without either a proper
invoice indicating that the tobacco products tax was paid by a
distributor for the tobacco products in the retailer's
possession or other proof that the tax was paid by the retailer
if it has purchased tobacco products on which tax has not been
paid as required by this Act. Failure to comply with the
provisions of this paragraph may be grounds for revocation of a
distributor's or retailer's license in accordance with Section
10-25 of this Act or Section 6 of the Cigarette Tax Act. In
addition, the Department may impose a civil penalty not to
exceed $1,000 for the first violation and $3,000 for each
subsequent violation, which shall be deposited into the Tax
Compliance and Administration Fund.
(Source: P.A. 98-1055, eff. 1-1-16.)
 
    (35 ILCS 143/10-38 new)
    Sec. 10-38. Presumption for unlicensed distributors or
persons. Whenever any person obtains tobacco products from an
unlicensed in-state or out-of-state distributor or person, a
prima facie presumption shall arise that the tax imposed by
this Act on such tobacco products has not been paid in
violation of this Act. Invoices or other documents kept in the
normal course of business in the possession of a person
reflecting purchases of tobacco products from an unlicensed
in-state or out-of-state distributor or person or invoices or
other documents kept in the normal course of business obtained
by the Department from in-state or out-of-state distributors or
persons, are sufficient to raise the presumption that the tax
imposed by this Act has not been paid. If a presumption is
raised, the Department may assess tax, penalty, and interest on
the tobacco products. In addition, any person who violates this
Section is liable to pay to the Department, for deposit in the
Tax Compliance and Administration Fund, a penalty of $1,000 for
the first violation and $3,000 for any subsequent violation.
The Department may adopt rules to administer the penalties
under this Section.
 
    (35 ILCS 143/10-40)
    Sec. 10-40. Invoices. Every distributor or other person who
purchases tobacco products for resale for shipment into
Illinois from a point outside Illinois shall procure invoices
in duplicate covering each shipment and shall make the invoices
available for inspection upon demand by a duly authorized
employee of the Department, and shall, if the Department so
requires, furnish one copy of each invoice to the Department at
the time of filing the return required by this Act.
(Source: P.A. 89-21, eff. 6-6-95.)
 
    (35 ILCS 143/10-50)
    Sec. 10-50. Violations and penalties. When the amount due
is under $300, any distributor who fails to file a return,
willfully fails or refuses to make any payment to the
Department of the tax imposed by this Act, or files a
fraudulent return, or any officer or agent of a corporation
engaged in the business of distributing tobacco products to
retailers and consumers located in this State who signs a
fraudulent return filed on behalf of the corporation, or any
accountant or other agent who knowingly enters false
information on the return of any taxpayer under this Act is
guilty of a Class 4 felony.
    Any person who violates any provision of Section 10-20,
10-21, or 10-22 of this Act, fails to keep books and records as
required under this Act, or willfully violates a rule or
regulation of the Department for the administration and
enforcement of this Act is guilty of a Class 4 felony. A person
commits a separate offense on each day that he or she engages
in business in violation of Section 10-20, 10-21, or 10-22 of
this Act. If a person fails to produce the books and records
for inspection by the Department upon request, a prima facie
presumption shall arise that the person has failed to keep
books and records as required under this Act. A person who is
unable to rebut this presumption is in violation of this Act
and is subject to the penalties provided in this Section.
    When the amount due is under $300, any person who accepts
money that is due to the Department under this Act from a
taxpayer for the purpose of acting as the taxpayer's agent to
make the payment to the Department, but who fails to remit the
payment to the Department when due, is guilty of a Class 4
felony.
    Any person who violates any provision of Sections 10-20,
10-21 and 10-22 of this Act, fails to keep books and records as
required under this Act, or willfully violates a rule or
regulation of the Department for the administration and
enforcement of this Act is guilty of a business offense and may
be fined up to $5,000. If a person fails to produce books and
records for inspection by the Department upon request, a prima
facie presumption shall arise that the person has failed to
keep books and records as required under this Act. A person who
is unable to rebut this presumption is in violation of this Act
and is subject to the penalties provided in this Section. A
person commits a separate offense on each day that he or she
engages in business in violation of Sections 10-20, 10-21 and
10-22 of this Act.
    When the amount due is $300 or more, any distributor who
files, or causes to be filed, a fraudulent return, or any
officer or agent of a corporation engaged in the business of
distributing tobacco products to retailers and consumers
located in this State who files or causes to be filed or signs
or causes to be signed a fraudulent return filed on behalf of
the corporation, or any accountant or other agent who knowingly
enters false information on the return of any taxpayer under
this Act is guilty of a Class 3 felony.
    When the amount due is $300 or more, any person engaged in
the business of distributing tobacco products to retailers and
consumers located in this State who fails to file a return,
willfully fails or refuses to make any payment to the
Department of the tax imposed by this Act, or accepts money
that is due to the Department under this Act from a taxpayer
for the purpose of acting as the taxpayer's agent to make
payment to the Department but fails to remit such payment to
the Department when due is guilty of a Class 3 felony.
    When the amount due is under $300, any retailer who fails
to file a return, willfully fails or refuses to make any
payment to the Department of the tax imposed by this Act, or
files a fraudulent return, or any officer or agent of a
corporation engaged in the retail business of selling tobacco
products to purchasers of tobacco products for use and
consumption located in this State who signs a fraudulent return
filed on behalf of the corporation, or any accountant or other
agent who knowingly enters false information on the return of
any taxpayer under this Act is guilty of a Class A misdemeanor
for a first offense and a Class 4 felony for each subsequent
offense.
    When the amount due is $300 or more, any retailer who fails
to file a return, willfully fails or refuses to make any
payment to the Department of the tax imposed by this Act, or
files a fraudulent return, or any officer or agent of a
corporation engaged in the retail business of selling tobacco
products to purchasers of tobacco products for use and
consumption located in this State who signs a fraudulent return
filed on behalf of the corporation, or any accountant or other
agent who knowingly enters false information on the return of
any taxpayer under this Act is guilty of a Class 4 felony.
    Any person whose principal place of business is in this
State and who is charged with a violation under this Section
shall be tried in the county where his or her principal place
of business is located unless he or she asserts a right to be
tried in another venue. If the taxpayer does not have his or
her principal place of business in this State, however, the
hearing must be held in Sangamon County unless the taxpayer
asserts a right to be tried in another venue.
    Any taxpayer or agent of a taxpayer who with the intent to
defraud purports to make a payment due to the Department by
issuing or delivering a check or other order upon a real or
fictitious depository for the payment of money, knowing that it
will not be paid by the depository, is guilty of a deceptive
practice in violation of Section 17-1 of the Criminal Code of
2012.
    A prosecution for a violation described in this Section may
be commenced within 3 years after the commission of the act
constituting the violation.
(Source: P.A. 100-201, eff. 8-18-17.)
 
    (35 ILCS 143/10-36 rep.)
    Section 40. The Tobacco Products Tax Act of 1995 is amended
by repealing Section 10-36.
 
    Section 99. Effective date. This Act takes effect upon
becoming law.