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Public Act 91-0200
SB434 Enrolled LRB9104499PTpk
AN ACT concerning taxation.
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) (from Ch. 120, par. 439.3-5)
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
music or dramatic arts 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 for the
presentation of live public performances of musical or
theatrical works on a regular basis.
(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) 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) 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.
(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 of the first division, a motor
vehicle of the second division that is a self-contained motor
vehicle designed or permanently converted to provide living
quarters for recreational, camping, or travel use, with
direct walk through to the living quarters from the driver's
seat, or a motor vehicle of the second division that is of
the van configuration designed for the transportation of not
less than 7 nor more than 16 passengers, as defined in
Section 1-146 of the Illinois Vehicle Code, 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) 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.
(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) 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) Coal exploration, mining, offhighway 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.
(17) 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.
(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.
(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" or
an "exotic game hunting area" as those terms are used in the
Wildlife Code or at a hunting enclosure approved through
rules adopted by the Department of Natural Resources. This
paragraph is exempt from the provisions of Section 3-90.
(Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
eff. 12-12-97; 90-605, eff. 6-30-98.)
Section 10. The Service Use Tax Act is amended by
changing Section 3-5 as follows:
(35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
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
music or dramatic arts 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 for the
presentation of live public performances of musical or
theatrical works on a regular basis.
(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) 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.
(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) 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.
(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) 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) Coal exploration, mining, offhighway 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.
(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.
(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" or
an "exotic game hunting area" as those terms are used in the
Wildlife Code or at a hunting enclosure approved through
rules adopted by the Department of Natural Resources. This
paragraph is exempt from the provisions of Section 3-75.
(Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
eff. 12-12-97; 90-605, eff. 6-30-98.)
Section 15. The Service Occupation Tax Act is amended by
changing Section 3-5 as follows:
(35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
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
music or dramatic arts 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 for
the presentation of live public performances of musical or
theatrical works on a regular basis.
(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) 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.
(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 3-75.
(8) 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.
(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) 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) Coal exploration, mining, offhighway 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.
(13) 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 5 of the Illinois Public Aid
Code who resides in a licensed long-term care facility, as
defined in the Nursing Home Care Act.
(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.
(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" or an "exotic
game hunting area" as those terms are used in the Wildlife
Code or at a hunting enclosure approved through rules adopted
by the Department of Natural Resources. This paragraph is
exempt from the provisions of Section 3-55.
(Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
eff. 12-12-97; 90-605, eff. 6-30-98; revised 2-10-99.)
Section 20. The Retailers' Occupation Tax Act is amended
by changing Section 2-5 as follows:
(35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
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 (7) is exempt
from the provisions of Section 2-70 3-75.
(3) 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) 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.
(5) A motor vehicle of the first division, a motor
vehicle of the second division that is a self-contained motor
vehicle designed or permanently converted to provide living
quarters for recreational, camping, or travel use, with
direct walk through access to the living quarters from the
driver's seat, or a motor vehicle of the second division that
is of the van configuration designed for the transportation
of not less than 7 nor more than 16 passengers, as defined in
Section 1-146 of the Illinois Vehicle Code, that is used for
automobile renting, as defined in the Automobile Renting
Occupation and Use Tax Act.
(6) Personal property sold by a teacher-sponsored
student organization affiliated with an elementary or
secondary school located in Illinois.
(7) 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 music or
dramatic arts 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 for the presentation
of live public performances of musical or theatrical works on
a regular basis.
(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) Personal property sold to interstate carriers for
hire for use as rolling stock moving in interstate commerce
or to lessors under leases of one year or longer executed or
in effect at the time of purchase 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.
(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.
(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) 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) Coal exploration, mining, offhighway 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.
(22) 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.
(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) 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 driveaway decal 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
driveaway decal 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.
(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.
(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" or an "exotic
game hunting area" as those terms are used in the Wildlife
Code or at a hunting enclosure approved through rules adopted
by the Department of Natural Resources. This paragraph is
exempt from the provisions of Section 2-70.
(Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-519,
eff. 6-1-98; 90-552, eff. 12-12-97; 90-605, eff. 6-30-98;
revised 2-10-99.)
Section 99. Effective date. This Act takes effect upon
becoming law.
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