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Public Act 91-0914
SB334 Enrolled LRB9102941NTsb
AN ACT regarding electricity excise taxes.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Enterprise Zone Act is amended
by changing Section 5.5 as follows:
(20 ILCS 655/5.5) (from Ch. 67 1/2, par. 609.1)
Sec. 5.5. High Impact Business.
(a) In order to respond to unique opportunities to
assist in the encouragement, development, growth and
expansion of the private sector through large scale
investment and development projects, the Department is
authorized to receive and approve applications for the
designation of "High Impact Businesses" in Illinois subject
to the following conditions:
(1) such applications may be submitted at any time
during the year;
(2) such business is not located, at the time of
designation, in an enterprise zone designated pursuant to
this Act;
(3) the business intends to make a minimum
investment of $12,000,000 which will be placed in service
in qualified property and intends to create 500 full-time
equivalent jobs at a designated location in Illinois or
intends to make a minimum investment of $30,000,000 which
will be placed in service in qualified property and
intends to retain 1,500 full-time jobs at a designated
location in Illinois. The business must certify in
writing that the investments would not be placed in
service in qualified property and the job creation or job
retention would not occur without the tax credits and
exemptions set forth in subsection (b) of this Section.
The terms "placed in service" and "qualified property"
have the same meanings as described in subsection (h) of
Section 201 of the Illinois Income Tax Act; and
(4) no later than 90 days after an application is
submitted, the Department shall notify the applicant of
the Department's determination of the qualification of
the proposed High Impact Business under this Section.
(b) Businesses designated as High Impact Businesses
pursuant to this Section shall qualify for the credits and
exemptions described in the following Acts: Section 9-222 and
Section 9-222.1A of The Public Utilities Act, subsection (h)
of Section 201 of the Illinois Income Tax Act; and, Section
1d of the Retailers' Occupation Tax Act, provided that these
credits and exemptions described in these Acts shall not be
authorized until the minimum investments set forth in
subsection (a) of this Section have been placed in service in
qualified properties and, in the case of the exemptions
described in the Public Utilities Act and Section 1d of the
Retailers' Occupation Tax Act, the minimum full-time
equivalent jobs or full-time jobs set forth in subsection (a)
of this Section have been created or retained. Businesses
designated as High Impact Businesses under this Section shall
also qualify for the exemption described in Section 5l of the
Retailers' Occupation Tax Act. The credit provided in
subsection (h) of Section 201 of the Illinois Income Tax Act
shall be applicable to investments in qualified property as
set forth in subsection (a) of this Section.
(c) High Impact Businesses located in federally
designated foreign trade zones or sub-zones are also eligible
for additional credits, exemptions and deductions as
described in the following Acts: Section 9-221 and Section
9-222.1 of the Public Utilities Act; and subsection (g) of
Section 201, and Section 203 of the Illinois Income Tax Act.
(d) Existing Illinois businesses which apply for
designation as a High Impact Business must provide the
Department with the prospective plan for which 1,500
full-time jobs would be eliminated in the event that the
business is not designated.
(e) New proposed facilities which apply for designation
as High Impact Business must provide the Department with
proof of alternative non-Illinois sites which would receive
the proposed investment and job creation in the event that
the business is not designated as a High Impact Business.
(f) In the event that a business is designated a High
Impact Business and it is later determined after reasonable
notice and an opportunity for a hearing as provided under The
Illinois Administrative Procedure Act, that the business
would have placed in service in qualified property the
investments and created or retained the requisite number of
jobs without the benefits of the High Impact Business
designation, the Department shall be required to immediately
revoke the designation and notify the Director of the
Department of Revenue who shall begin proceedings to recover
all wrongfully exempted State taxes with interest. The
business shall also be ineligible for all State funded
Department programs for a period of 10 years.
(g) The Department shall revoke a High Impact Business
designation if the participating business fails to comply
with the terms and conditions of the designation.
(h) Prior to designating a business, the Department
shall provide the members of the General Assembly and
Illinois Economic and Fiscal Commission with a report setting
forth the terms and conditions of the designation and
guarantees that have been received by the Department in
relation to the proposed business being designated.
(Source: P.A. 89-89, eff. 6-30-95.)
Section 10. The Electricity Excise Tax Law is amended by
changing Sections 2-3 and 2-4 as follows:
(35 ILCS 640/2-3)
Sec. 2-3. Definitions. As used in this Law, unless the
context clearly requires otherwise:
(a) "Department" means the Department of Revenue of the
State of Illinois.
(b) "Director" means the Director of the Department of
Revenue of the State of Illinois.
(c) "Person" means any natural individual, firm, trust,
estate, partnership, association, joint stock company, joint
venture, corporation, limited liability company, or a
receiver, trustee, guardian, or other representative
appointed by order of any court, or any city, town, village,
county, or other political subdivision of this State.
(d) "Purchase price" means the consideration paid for
the distribution, supply, furnishing, sale, transmission or
delivery of electricity to a person for non-residential use
or consumption (and for both residential and non-residential
use or consumption in the case of electricity purchased from
a municipal system or electric cooperative described in
subsection (b) of Section 2-4) and not for resale, and for
all services directly related to the production, transmission
or distribution of electricity distributed, supplied,
furnished, sold, transmitted or delivered for non-residential
use or consumption, and includes transition charges imposed
in accordance with Article XVI of the Public Utilities Act
and instrument funding charges imposed in accordance with
Article XVIII of the Public Utilities Act, as well as cash,
services and property of every kind or nature, and shall be
determined without any deduction on account of the cost of
the service, product or commodity supplied, the cost of
materials used, labor or service costs, or any other expense
whatsoever. However, "purchase price" shall not include
consideration paid for:
(i) any charge for a dishonored check;
(ii) any finance or credit charge, penalty or
charge for delayed payment, or discount for prompt
payment;
(iii) any charge for reconnection of service or for
replacement or relocation of facilities;
(iv) any advance or contribution in aid of
construction;
(v) repair, inspection or servicing of equipment
located on customer premises;
(vi) leasing or rental of equipment, the leasing or
rental of which is not necessary to furnishing, supplying
or selling electricity;
(vii) any purchase by a purchaser if the supplier
is prohibited by federal or State constitution, treaty,
convention, statute or court decision from recovering the
related tax liability from such purchaser; and
(viii) any amounts added to purchasers' bills
because of charges made pursuant to the tax imposed by
this Law.
In case credit is extended, the amount thereof shall be
included only as and when payments are made.
"Purchase price" shall not include consideration received
from business enterprises certified under Section 9-222.1 or
9-222.1A of the Public Utilities Act, as amended, to the
extent of such exemption and during the period of time
specified by the Department of Commerce and Community
Affairs.
(e) "Purchaser" means any person who acquires
electricity for use or consumption and not for resale, for a
valuable consideration.
(f) "Non-residential electric use" means any use or
consumption of electricity which is not residential electric
use.
(g) "Residential electric use" means electricity used or
consumed at a dwelling of 2 or fewer units, or electricity
for household purposes used or consumed at a building with
multiple dwelling units where the electricity is registered
by a separate meter for each dwelling unit.
(h) "Self-assessing purchaser" means a purchaser for
non-residential electric use who elects to register with and
to pay tax directly to the Department in accordance with
Sections 2-10 and 2-11 of this Law.
(i) "Delivering supplier" means any person engaged in
the business of delivering electricity to persons for use or
consumption and not for resale and who, in any case where
more than one person participates in the delivery of
electricity to a specific purchaser, is the last of the
suppliers engaged in delivering the electricity prior to its
receipt by the purchaser.
(j) "Delivering supplier maintaining a place of business
in this State", or any like term, means any delivering
supplier having or maintaining within this State, directly or
by a subsidiary, an office, generation facility, transmission
facility, distribution facility, sales office or other place
of business, or any employee, agent or other representative
operating within this State under the authority of such
delivering supplier or such delivering supplier's subsidiary,
irrespective of whether such place of business or agent or
other representative is located in this State permanently or
temporarily, or whether such delivering supplier or such
delivering supplier's subsidiary is licensed to do business
in this State.
(k) "Use" means the exercise by any person of any right
or power over electricity incident to the ownership of that
electricity, except that it does not include the generation,
production, transmission, distribution, delivery or sale of
electricity in the regular course of business or the use of
electricity for such purposes.
(Source: P.A. 90-561, eff. 8-1-98.)
(35 ILCS 640/2-4)
Sec. 2-4. Tax imposed.
(a) Except as provided in subsection (b), a tax is
imposed on the privilege of using in this State electricity
purchased for use or consumption and not for resale, other
than by municipal corporations owning and operating a local
transportation system for public service, at the following
rates per kilowatt-hour delivered to the purchaser:
(i) For the first 2000 kilowatt-hours used or
consumed in a month: 0.330 cents per kilowatt-hour;
(ii) For the next 48,000 kilowatt-hours used or
consumed in a month: 0.319 cents per kilowatt-hour;
(iii) For the next 50,000 kilowatt-hours used or
consumed in a month: 0.303 cents per kilowatt-hour;
(iv) For the next 400,000 kilowatt-hours used or
consumed in a month: 0.297 cents per kilowatt-hour;
(v) For the next 500,000 kilowatt-hours used or
consumed in a month: 0.286 cents per kilowatt-hour;
(vi) For the next 2,000,000 kilowatt-hours used or
consumed in a month: 0.270 cents per kilowatt-hour;
(vii) For the next 2,000,000 kilowatt-hours used or
consumed in a month: 0.254 cents per kilowatt-hour;
(viii) For the next 5,000,000 kilowatt-hours used
or consumed in a month: 0.233 cents per kilowatt-hour;
(ix) For the next 10,000,000 kilowatt-hours used or
consumed in a month: 0.207 cents per kilowatt-hour;
(x) For all electricity in excess of 20,000,000
kilowatt-hours used or consumed in a month: 0.202 cents
per kilowatt-hour.
Provided, that in lieu of the foregoing rates, the tax is
imposed on a self-assessing purchaser at the rate of 5.1% of
the self-assessing purchaser's purchase price for all
electricity distributed, supplied, furnished, sold,
transmitted and delivered to the self-assessing purchaser in
a month.
(b) A tax is imposed on the privilege of using in this
State electricity purchased from a municipal system or
electric cooperative, as defined in Article XVII of the
Public Utilities Act, which has not made an election as
permitted by either Section 17-200 or Section 17-300 of such
Act, at the lesser of 0.32 cents per kilowatt hour of all
electricity distributed, supplied, furnished, sold,
transmitted, and delivered by such municipal system or
electric cooperative to the purchaser or 5% of each such
purchaser's purchase price for all electricity distributed,
supplied, furnished, sold, transmitted, and delivered by such
municipal system or electric cooperative to the purchaser,
whichever is the lower rate as applied to each purchaser in
each billing period.
(c) The tax imposed by this Section 2-4 is not imposed
with respect to any use of electricity by business
enterprises certified under Section 9-222.1 or 9-222.1A of
the Public Utilities Act, as amended, to the extent of such
exemption and during the time specified by the Department of
Commerce and Community Affairs; or with respect to any
transaction in interstate commerce, or otherwise, to the
extent to which such transaction may not, under the
Constitution and statutes of the United States, be made the
subject of taxation by this State.
(Source: P.A. 90-561, eff. 8-1-98.)
Section 15. The Public Utilities Act is amended by
changing Section 9-222 and adding Section 9-222.1A as
follows:
(220 ILCS 5/9-222) (from Ch. 111 2/3, par. 9-222)
Sec. 9-222. Whenever a tax is imposed upon a public
utility engaged in the business of distributing, supplying,
furnishing, or selling gas for use or consumption pursuant to
Section 2 of the Gas Revenue Tax Act, or whenever a tax is
required to be collected by a delivering supplier pursuant to
Section 2-7 of the Electricity Excise Tax Act imposed upon a
public utility in the business of distributing, supplying,
furnishing or selling electricity for use or consumption
pursuant to Section 2 of The Public Utilities Revenue Act, or
whenever a tax is imposed upon a public utility pursuant to
Section 2-202 of this Act, such utility may charge its
customers, other than customers who are high impact
businesses under Section 5.5 of the Illinois Enterprise Zone
Act, or certified business enterprises under Section 9-222.1
of this Act, to the extent of such exemption and during the
period in which such exemption is in effect, in addition to
any rate authorized by this Act, an additional charge equal
to the total amount of such taxes. The exemption of this
Section relating to high impact businesses shall be subject
to the provisions of subsections (a) and (b) of Section 5.5
of the Illinois Enterprise Zone Act. This requirement shall
not apply to taxes on invested capital imposed pursuant to
the Messages Tax Act, the Gas Revenue Tax Act and the Public
Utilities Revenue Act. Such utility shall file with the
Commission a supplemental schedule which shall specify such
additional charge and which shall become effective upon
filing without further notice. Such additional charge shall
be shown separately on the utility bill to each customer.
The Commission shall have the power to investigate whether or
not such supplemental schedule correctly specifies such
additional charge, but shall have no power to suspend such
supplemental schedule. If the Commission finds, after a
hearing, that such supplemental schedule does not correctly
specify such additional charge, it shall by order require a
refund to the appropriate customers of the excess, if any,
with interest, in such manner as it shall deem just and
reasonable, and in and by such order shall require the
utility to file an amended supplemental schedule
corresponding to the finding and order of the Commission.
Except with respect to taxes imposed on invested capital,
such tax liabilities shall be recovered from customers solely
by means of the additional charges authorized by this
Section.
(Source: P.A. 85-1182.)
(220 ILCS 5/9-222.1A new)
Sec. 9-222.1A. High impact business. Beginning on August
1, 1998 and thereafter, a business enterprise that is
certified as a High Impact Business by the Department of
Commerce and Community Affairs is exempt from the tax
imposed by Section 2-4 of the Electricity Excise Tax Law, if
the High Impact Business is registered to self-assess that
tax, and is exempt from any additional charges added to the
business enterprise's utility bills as a pass-on of State
utility taxes under Section 9-222 of this Act, to the extent
the tax or charges are exempted by the percentage specified
by the Department of Commerce and Community Affairs for
State utility taxes, provided the business enterprise meets
the following criteria:
(1) it intends either (i) to make a minimum
eligible investment of $12,000,000 that will be placed in
service in qualified property in Illinois and is intended
to create at least 500 full-time equivalent jobs at a
designated location in Illinois; or (ii) to make a
minimum eligible investment of $30,000,000 that will be
placed in service in qualified property in Illinois and
is intended to retain at least 1,500 full-time equivalent
jobs at a designated location in Illinois;
(2) it is designated as a High Impact Business by
the Department of Commerce and Community Affairs; and
(3) it is certified by the Department of Commerce
and Community Affairs as complying with the requirements
specified in clauses (1) and (2) of this Section.
The Department of Commerce and Community Affairs shall
determine the period during which the exemption from the
Electricity Excise Tax Law and the charges imposed under
Section 9-222 are in effect, which shall not exceed 20 years
from the date of initial certification, and shall specify the
percentage of the exemption from those taxes or additional
charges.
The Department of Commerce and Community Affairs is
authorized to promulgate rules and regulations to carry out
the provisions of this Section, including procedures for
complying with the requirements specified in clauses (1)
and (2) of this Section and procedures for applying for the
exemptions authorized under this Section; to define the
amounts and types of eligible investments that business
enterprises must make in order to receive State utility tax
exemptions or exemptions from the additional charges imposed
under Section 9-222 and this Section; to approve such utility
tax exemptions for business enterprises whose investments are
not yet placed in service; and to require that business
enterprises granted tax exemptions or exemptions from
additional charges under Section 9-222 repay the exempted
amount if the business enterprise fails to comply with the
terms and conditions of the certification.
Upon certification of the business enterprises by the
Department of Commerce and Community Affairs, the Department
of Commerce and Community Affairs shall notify the Department
of Revenue of the certification. The Department of Revenue
shall notify the public utilities of the exemption status of
business enterprises from the tax or pass-on charges of State
utility taxes. The exemption status shall take effect within
3 months after certification of the business enterprise.
Section 99. Effective date. This Act takes effect upon
becoming law.
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