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Public Act 92-0526
SB88 Enrolled LRB9202600SMdv
AN ACT concerning telecommunications.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
ARTICLE 5
Section 5-1. Short title. This Act may be cited as the
Simplified Municipal Telecommunications Tax Act.
Section 5-5. Legislative intent. The General Assembly has
authorized the corporate authorities of any municipality to
impose various fees and taxes on the privilege of originating
or receiving telecommunications, and on retailers engaged in
the business of transmitting such telecommunications, all of
which are remitted by such retailers directly to the imposing
municipality. To simplify the imposition and collection of
municipal telecommunications taxes and to reduce complication
and burden, the General Assembly is repealing the municipal
telecommunications tax, the municipal tax on the occupation
or privilege of transmitting messages, and the municipal
infrastructure maintenance fee, and is enacting this
Simplified Municipal Telecommunications Tax Act which
provides for a single municipally imposed telecommunications
tax which, for municipalities with populations of less than
500,000, will be collected by the Illinois Department of
Revenue, but which, for municipalities of 500,000 or more,
will continue to be collected by such municipalities.
Section 5-7. Definitions. For purposes of the taxes
authorized by this Act:
"Amount paid" means the amount charged to the taxpayer's
service address in such municipality regardless of where such
amount is billed or paid.
"Department" means the Illinois Department of Revenue.
"Gross charge" means the amount paid for the act or
privilege of originating or receiving telecommunications in
such municipality and for all services and equipment provided
in connection therewith by a retailer, valued in money
whether paid in money or otherwise, including cash, credits,
services and property of every kind or nature, and shall be
determined without any deduction on account of the cost of
such telecommunications, the cost of the materials used,
labor or service costs or any other expense whatsoever. In
case credit is extended, the amount thereof shall be included
only as and when paid. "Gross charges" for private line
service shall include charges imposed at each channel point
within this State, charges for the channel mileage between
each channel point within this State, and charges for that
portion of the interstate inter-office channel provided
within Illinois. However, "gross charge" shall not include:
(1) any amounts added to a purchaser's bill because
of a charge made pursuant to: (i) the tax imposed by this
Act, (ii) the tax imposed by the Telecommunications
Excise Tax Act, (iii) the tax imposed by Section 4251 of
the Internal Revenue Code, (iv) 911 surcharges, or (v)
charges added to customers' bills pursuant to the
provisions of Section 9-221 or 9-222 of the Public
Utilities Act, as amended, or any similar charges added
to customers' bills by retailers who are not subject to
rate regulation by the Illinois Commerce Commission for
the purpose of recovering any of the tax liabilities or
other amounts specified in those provisions of the Public
Utilities Act;
(2) charges for a sent collect telecommunication
received outside of such municipality;
(3) charges for leased time on equipment or charges
for the storage of data or information for subsequent
retrieval or the processing of data or information
intended to change its form or content. Such equipment
includes, but is not limited to, the use of calculators,
computers, data processing equipment, tabulating
equipment or accounting equipment and also includes the
usage of computers under a time-sharing agreement;
(4) charges for customer equipment, including such
equipment that is leased or rented by the customer from
any source, wherein such charges are disaggregated and
separately identified from other charges;
(5) charges to business enterprises certified as
exempt under Section 9-222.1 of the Public Utilities Act
to the extent of such exemption and during the period of
time specified by the Department of Commerce and
Community Affairs;
(6) charges for telecommunications and all services
and equipment provided in connection therewith between a
parent corporation and its wholly owned subsidiaries or
between wholly owned subsidiaries when the tax imposed
under this Act has already been paid to a retailer and
only to the extent that the charges between the parent
corporation and wholly owned subsidiaries or between
wholly owned subsidiaries represent expense allocation
between the corporations and not the generation of profit
for the corporation rendering such service;
(7) bad debts ("bad debt" means any portion of a
debt that is related to a sale at retail for which gross
charges are not otherwise deductible or excludable that
has become worthless or uncollectible, as determined
under applicable federal income tax standards; if the
portion of the debt deemed to be bad is subsequently
paid, the retailer shall report and pay the tax on that
portion during the reporting period in which the payment
is made);
(8) charges paid by inserting coins in
coin-operated telecommunication devices; or
(9) amounts paid by telecommunications retailers
under the Telecommunications Infrastructure Maintenance
Fee Act.
"Interstate telecommunications" means all
telecommunications that either originate or terminate outside
this State.
"Intrastate telecommunications" means all
telecommunications that originate and terminate within this
State.
"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, the Federal and State
governments, including State universities created by statute,
or any city, town, county, or other political subdivision of
this State.
"Purchase at retail" means the acquisition, consumption
or use of telecommunications through a sale at retail.
"Retailer" means and includes every person engaged in the
business of making sales at retail as defined in this
Section. The Department may, in its discretion, upon
application, authorize the collection of the tax hereby
imposed by any retailer not maintaining a place of business
within this State, who, to the satisfaction of the
Department, furnishes adequate security to insure collection
and payment of the tax. Such retailer shall be issued,
without charge, a permit to collect such tax. When so
authorized, it shall be the duty of such retailer to collect
the tax upon all of the gross charges for telecommunications
in this State in the same manner and subject to the same
requirements as a retailer maintaining a place of business
within this State. The permit may be revoked by the
Department at its discretion.
"Retailer maintaining a place of business in this State",
or any like term, means and includes any retailer having or
maintaining within this State, directly or by a subsidiary,
an office, distribution facilities, transmission facilities,
sales office, warehouse or other place of business, or any
agent or other representative operating within this State
under the authority of the retailer or its subsidiary,
irrespective of whether such place of business or agent or
other representative is located here permanently or
temporarily, or whether such retailer or subsidiary is
licensed to do business in this State.
"Sale at retail" means the transmitting, supplying or
furnishing of telecommunications and all services and
equipment provided in connection therewith for a
consideration, to persons other than the Federal and State
governments, and State universities created by statute and
other than between a parent corporation and its wholly owned
subsidiaries or between wholly owned subsidiaries for their
use or consumption and not for resale.
"Service address" means the location of
telecommunications equipment from which telecommunications
services are originated or at which telecommunications
services are received by a taxpayer. In the event this may
not be a defined location, as in the case of mobile phones,
paging systems, and maritime systems, service address means
the customer's place of primary use as defined in the Mobile
Telecommunications Sourcing Conformity Act. For
air-to-ground systems and the like, "service address" shall
mean the location of a taxpayer's primary use of the
telecommunications equipment as defined by telephone number,
authorization code, or location in Illinois where bills are
sent.
"Taxpayer" means a person who individually or through his
or her agents, employees, or permittees engages in the act or
privilege of originating or receiving telecommunications in a
municipality and who incurs a tax liability as authorized by
this Act.
"Telecommunications", in addition to the meaning
ordinarily and popularly ascribed to it, includes, without
limitation, messages or information transmitted through use
of local, toll, and wide area telephone service, private line
services, channel services, telegraph services,
teletypewriter, computer exchange services, cellular mobile
telecommunications service, specialized mobile radio,
stationary two-way radio, paging service, or any other form
of mobile and portable one-way or two-way communications, or
any other transmission of messages or information by
electronic or similar means, between or among points by wire,
cable, fiber optics, laser, microwave, radio, satellite, or
similar facilities. As used in this Act, "private line"
means a dedicated non-traffic sensitive service for a single
customer, that entitles the customer to exclusive or priority
use of a communications channel or group of channels, from
one or more specified locations to one or more other
specified locations. The definition of "telecommunications"
shall not include value added services in which computer
processing applications are used to act on the form, content,
code, and protocol of the information for purposes other than
transmission. "Telecommunications" shall not include
purchases of telecommunications by a telecommunications
service provider for use as a component part of the service
provided by such provider to the ultimate retail consumer who
originates or terminates the taxable end-to-end
communications. Carrier access charges, right of access
charges, charges for use of inter-company facilities, and all
telecommunications resold in the subsequent provision of,
used as a component of, or integrated into, end-to-end
telecommunications service shall be non-taxable as sales for
resale. Prepaid telephone calling arrangements shall not be
considered "telecommunications" subject to the tax imposed
under this Act. For purposes of this Section, "prepaid
telephone calling arrangements" means that term as defined in
Section 2-27 of the Retailers' Occupations Tax Act.
Section 5-10. Authority. The corporate authorities of
any municipality in this State may tax any and all of the
following acts or privileges:
(a) The act or privilege of originating in such
municipality or receiving in such municipality intrastate
telecommunications by a person. However, such tax is not
imposed on such act or privilege to the extent such act or
privilege may not, under the Constitution and statutes of the
United States, be made the subject of taxation by
municipalities in this State.
(b) The act or privilege of originating in such
municipality or receiving in such municipality interstate
telecommunications by a person. To prevent actual multi-state
taxation of the act or privilege that is subject to taxation
under this subsection, any taxpayer, upon proof that the
taxpayer has paid a tax in another state on such event, shall
be allowed a credit against any tax enacted pursuant to or
authorized by this Section to the extent of the amount of
such tax properly due and paid in such other state which was
not previously allowed as a credit against any other state or
local tax in this State. However, such tax is not imposed on
the act or privilege to the extent such act or privilege may
not, under the Constitution and statutes of the United
States, be made the subject of taxation by municipalities in
this State.
Section 5-15. Maximum rates.
(a) For municipalities with a population of less than
500,000, the tax authorized by this Act may be imposed at a
rate not to exceed 6% of the gross charge for
telecommunications purchased at retail. If imposed, the tax
must be in increments of 0.25%.
(b) For municipalities with a population of 500,000 or
more, the tax authorized by this Act may be imposed at a rate
not to exceed 7% of the gross charge for telecommunications
purchased at retail. If imposed, the tax must be in
increments of 0.25%.
Section 5-20. Imposition.
(a) On and after January 1, 2003, for municipalities
with populations of less than 500,000, the tax authorized by
this Act shall be imposed (except as provided in Sections
5-25 and 5-30 of this Act), amended, or repealed by an
ordinance adopted by the municipality, which ordinance shall
be filed by the municipality with the Department pursuant to
the rules of the Department.
(1) Any ordinance adopted by a municipality with a
population of less than 500,000 which attempts to impose,
amend or repeal the tax authorized by this Act shall be
of no force and effect until properly filed with an
appropriate form with the Department.
(2) Any certified copy of an ordinance filed with
the Department prior to October 1, 2002 shall be
effective with respect to gross charges billed by
telecommunications retailers on or after January 1, 2003
and thereafter any certified copy of an ordinance filed
with the Department prior to any April 1 or October 1
shall be effective with respect to gross charges billed
by telecommunications retailers on or after the following
July 1 or January 1, respectively.
(b) On and after January 1, 2003, for municipalities
with populations of 500,000 or more, the tax authorized by
this Act shall be imposed, amended, or repealed, and any
authorized exemptions granted, by the adoption of an
ordinance.
Section 5-25. Existing telecommunications taxes and
fees.
(a) Between July 1, 2002 and August 1, 2002, the
Department shall publish a list of the municipalities with a
population of less than 500,000 that have, at any time before
the effective date of this Act, enacted ordinances imposing
any taxes or fees authorized by subparagraph 1 of Section
8-11-2 of the Illinois Municipal Code, Section 8-11-17 of the
Illinois Municipal Code, or Section 20 of the
Telecommunications Infrastructure Maintenance Fee Act. Such
list shall include the name of each such municipality, the
rates at which such taxes or fees are imposed as of the
effective date of this Act, and the rate of the new
Simplified Municipal Telecommunications Tax, as calculated
pursuant to Section 5-30 of this Act.
(b) In compiling the list described in this Section, the
Department shall collect information from retailers,
municipalities, the Illinois Commerce Commission, and other
sources deemed by the Department to be reliable.
(c) Any municipality appearing on the list published
pursuant to this Section shall not be required to adopt and
file an ordinance implementing the tax authorized by this
Act. The list shall be conclusive evidence of the imposition
of the tax authorized by this Act at the rate appearing on
such list. Any tax imposed in such manner shall take effect
with respect to gross charges billed by telecommunications
retailers on or after January 1, 2003. A municipality may
alter such tax only by filing an ordinance with the
Department pursuant to Section 5-20 of this Act.
Section 5-30. Calculation of rates for certain
municipalities. The rate of the Simplified Municipal
Telecommunications Tax for municipalities on the list
described in Section 5-25 of this Act shall be measured by
the sum of the following rates set forth in ordinances
enacted by the municipalities at the rates in effect on the
effective date of this Act:
(1) The rate equal to 70% of the rate set forth in
such ordinance pursuant to subparagraph 1 of Section
8-11-2 of the Illinois Municipal Code, rounded to the
nearest even 0.25% increment; plus
(2) The rate set forth in such ordinance pursuant
to Section 8-11-17 of the Illinois Municipal Code,
rounded to the nearest even 0.25% increment; plus
(3) The rate set forth in such ordinance pursuant
to Section 20 of the Telecommunications Infrastructure
Maintenance Fee Act.
Section 5-35. Rebates and exemptions. Any municipality
may implement the following rebates and exemptions:
(1) A municipality that imposes the tax authorized
by this Act and whose territory includes part of another
unit of local government or a school district, may, by
separate ordinance, rebate some or all of the amount of
such tax paid by the other unit of local government or
school district. Any such rebate shall be paid by the
municipality directly to the other unit of local
government or school district qualifying for the rebate
as determined by the municipality's ordinance, which
shall not be filed with the Department.
(2) A municipality that imposes the tax authorized
by this Act may, by separate ordinance, rebate some or
all of the amount of such tax to persons 65 years of age
or older. Any tax related to such rebate shall be
rebated from the municipality directly to persons
qualified for the rebate as determined by the
municipality's ordinance, which shall not be filed with
the Department.
(3) A municipality with a population of 500,000 or
more that imposes the tax authorized by this Act may, by
separate ordinance, exempt from the tax authorized by
this Act, charges for inbound toll-free
telecommunications service commonly known as "800",
"877", or "888" or for a similar service, to the extent
such municipality has passed an ordinance providing for
this exemption.
Section 5-40. Collection.
(a) For municipalities with populations of less than
500,000, the tax authorized by this Act shall be collected
from the taxpayer by a retailer maintaining a place of
business in this State and shall be remitted by such retailer
to the Department. Any tax required to be collected pursuant
to or as authorized by this Act and any such tax collected by
such retailer and required to be remitted to the Department
shall constitute a debt owed by the retailer to the State.
Retailers shall collect the tax from the taxpayer by adding
the tax to the gross charge for the act or privilege of
originating or receiving telecommunications when sold for
use, in the manner prescribed by the Department. The tax
authorized by this Act shall constitute a debt of the
taxpayer to the retailer until paid, and, if unpaid, is
recoverable at law in the same manner as the original charge
for such sale at retail. If the retailer fails to collect
the tax from the taxpayer, then the taxpayer shall be
required to pay the tax directly to the Department in the
manner provided by the Department.
(b) For municipalities with populations of 500,000 or
more, the tax authorized by this Act shall be collected from
the taxpayer by a retailer making or effectuating the sale at
retail and shall be remitted by such retailer to such
municipality. Any tax required to be collected pursuant to
an ordinance authorized by this Act and any such tax
collected by a retailer shall constitute a debt owed by the
retailer to such municipality. Retailers shall collect the
tax from the taxpayer by adding the tax to the gross charge
for the act or privilege of originating or receiving
telecommunications when sold for use, in the manner
prescribed by such municipality. The tax authorized by this
Act shall constitute a debt of the taxpayer to the retailer
who made or effectuated the sale at retail until paid and, if
unpaid, is recoverable at law in the same manner as the
original charge for the sale at retail. If the retailer
fails to collect the tax from the taxpayer, then the taxpayer
shall be required to pay the tax directly to such
municipality in the manner provided by such municipality.
The municipality imposing the tax shall provide for its
administration and enforcement.
(c) Retailers filing tax returns pursuant to this Act
shall, at the time of filing such return, pay to a
municipality with a population of 500,000 or more or to the
Department for all other municipalities, the amount of the
tax collected, less a discount of 1% which is allowed to
reimburse the retailer for the expenses incurred in keeping
records, billing the customer, preparing and filing returns,
remitting the tax and supplying data to a municipality or the
Department upon request. No discount may be claimed by a
retailer on returns not timely filed and for taxes not timely
remitted.
(d) Whenever possible, the tax authorized by this Act
shall, when collected, be stated as a distinct item separate
and apart from the gross charge for telecommunications.
Section 5-45. Resellers.
(a) If a person who originates or receives
telecommunications claims to be a reseller of such
telecommunications, such person shall apply to a municipality
with a population of 500,000 or more or to the Department for
all other municipalities, for a resale number. Such
applicant shall state facts which will show a municipality
with a population of 500,000 or more or the Department for
all other municipalities, why such applicant is not liable
for tax authorized by this Act on any of such purchases and
shall furnish such additional information as a municipality
with a population of 500,000 or more or the Department for
all other municipalities, may reasonably require.
(b) Upon approval of the application, a municipality
with a population of 500,000 or more or the Department for
all other municipalities, shall assign a resale number to the
applicant and shall certify such number to the applicant. A
municipality with a population of 500,000 or more or the
Department for all other municipalities, may cancel any
number which is obtained through misrepresentation, or which
is used to send or receive such telecommunication tax-free
when such actions in fact are not for resale, or which no
longer applies because of the person's having discontinued
the making of resales.
(c) Except as provided hereinabove in this Section, the
act or privilege of originating or receiving
telecommunications in this State shall not be made tax-free
on the ground of being a sale for resale unless the person
has an active resale number from a municipality with a
population of 500,000 or more or the Department for all other
municipalities, and furnishes that number to the retailer in
connection with certifying to the retailer that any sale to
such person is non-taxable because of being a sale for
resale.
Section 5-50. Returns to the Department.
(a) Commencing on February 1, 2003, for the tax imposed
under subsection (a) of Section 5-20 of this Act, every
retailer maintaining a place of business in this State shall,
on or before the last day of each month make a return to the
Department for the preceding calendar month, stating:
(1) Its name;
(2) The address of its principal place of business
or the address of the principal place of business (if
that is a different address) from which it engages in the
business of transmitting telecommunications;
(3) Total amount of gross charges billed by it
during the preceding calendar month for providing
telecommunications during the calendar month;
(4) Total amount received by it during the
preceding calendar month on credit extended;
(5) Deductions allowed by law;
(6) Gross charges that were billed by it during the
preceding calendar month and upon the basis of which the
tax is imposed;
(7) Amount of tax (computed upon Item 6);
(8) The municipalities to which the Department
shall remit the taxes and the amount of such remittances;
(9) Such other reasonable information as the
Department may require.
(b) Any retailer required to make payments under this
Section may make the payments by electronic funds transfer.
The Department shall adopt rules necessary to effectuate a
program of electronic funds transfer. Any retailer who has
average monthly tax billings due to the Department under this
Act and the Telecommunications Excise Tax Act that exceed
$1,000 shall make all payments by electronic funds transfer
as required by rules of the Department.
(c) If the retailer's average monthly tax billings due
to the Department under this Act and the Telecommunications
Excise Tax Act do not exceed $1,000, the Department may
authorize such retailer's returns to be filed on a
quarter-annual basis, with the return for January, February,
and March of a given year being due by April 30th of that
year; with the return for April, May, and June of a given
year being due by July 31st of that year; with the return for
July, August, and September of a given year being due by
October 31st of that year; and with the return for October,
November, and December of a given year being due by January
31st of the following year.
(d) If the retailer is otherwise required to file a
monthly or quarterly return and if the retailer's average
monthly tax billings due to the Department under this Act and
the Telecommunications Excise Tax Act do not exceed $400, the
Department may authorize such retailer's return to be filed
on an annual basis, with the return for a given year being
due by January 31st of the following year.
(e) Each retailer whose average monthly remittance to
the Department under this Act and the Telecommunications
Excise Tax Act was $25,000 or more during the preceding
calendar year, excluding the month of highest remittance and
the month of lowest remittance in such calendar year, and who
is not operated by a unit of local government, shall make
estimated payments to the Department on or before the 7th,
15th, 22nd, and last day of the month during which the tax
remittance is owed to the Department in an amount not less
than the lower of either 22.5% of the retailer's actual tax
collections for the month or 25% of the retailer's actual tax
collections for the same calendar month of the preceding
year. The amount of such quarter-monthly payments shall be
credited against the final remittance of the retailer's
return for that month. Any outstanding credit, approved by
the Department, arising from the retailer's overpayment of
its final remittance for any month may be applied to reduce
the amount of any subsequent quarter-monthly payment or
credited against the final remittance of the retailer's
return for any subsequent month. If any quarter-monthly
payment is not paid at the time or in the amount required by
this Section, the retailer shall be liable for penalty and
interest on the difference between the minimum amount due as
a payment and the amount of such payment actually and timely
paid, except insofar as the retailer has previously made
payments for that month to the Department or received credits
in excess of the minimum payments previously due.
(f) Notwithstanding any other provision of this Section
containing the time within which a retailer may file his or
her return, in the case of any retailer who ceases to engage
in a kind of business that makes him or her responsible for
filing returns under this Section, the retailer shall file a
final return under this Section with the Department not more
than one month after discontinuing such business.
(g) In making such return, the retailer shall determine
the value of any consideration other than money received by
it and such retailer shall include the value in its return.
Such determination shall be subject to review and revision by
the Department in the manner hereinafter provided for the
correction of returns.
(h) Any retailer who has average monthly tax billings
due to the Department under this Act and the
Telecommunications Excise Tax Act that exceed $1,000 shall
file the return required by this Section by electronic means
as required by rules of the Department.
(i) The retailer filing the return herein provided for
shall, at the time of filing the return, pay to the
Department the amounts due pursuant to this Act. The
Department shall immediately pay over to the State Treasurer,
ex officio, as trustee, 99.5% of all taxes, penalties, and
interest collected hereunder for deposit into the Municipal
Telecommunications Fund, which is hereby created. The
remaining 0.5% received by the Department pursuant to this
Act shall be deposited into the Tax Compliance and
Administration Fund and shall be used by the Department,
subject to appropriation, to cover the costs of the
Department. On or before the 25th day of each calendar month,
the Department shall prepare and certify to the Comptroller
the disbursement of stated sums of money to be paid to named
municipalities from the Municipal Telecommunications Fund for
amounts collected during the second preceding calendar month.
The named municipalities shall be those municipalities
identified by a retailer in such retailer's return as having
imposed the tax authorized by the Act. The amount of money
to be paid to each municipality shall be the amount (not
including credit memoranda) collected hereunder during the
second preceding calendar month by the Department, plus an
amount the Department determines is necessary to offset any
amounts that were erronenously paid to a different taxing
body, and not including an amount equal to the amount of
refunds made during the second preceding calendar month by
the Department on behalf of such municipality, and not
including any amount that the Department determines is
necessary to offset any amount that were payable to a
different taxing body but were erroneously paid to the
municipality. Within 10 days after receipt by the
Comptroller of the disbursement certification from the
Department, the Comptroller shall cause the orders to be
drawn for the respective amounts in accordance with the
directions contained in the certification. When certifying
to the Comptroller the amount of a monthly disbursement to a
municipality under this Section, the Department shall
increase or decrease the amount by an amount necessary to
offset any misallocation of previous disbursements. The
offset amount shall be the amount erroneously disbursed
within the previous 6 months from the time a misallocation is
discovered.
(j) For municipalities with populations of less than
500,000, whenever the Department determines that a refund
shall be made under this Section to a claimant instead of
issuing a credit memorandum, the Department shall notify the
State Comptroller, who shall cause the order to be drawn for
the amount specified and to the person named in the
notification from the Department. The refund shall be paid
by the State Treasurer out of the Municipal
Telecommunications Fund.
Section 5-55. Pledged revenues. If a municipality has,
by contract, pledged or dedicated any or all of the revenues
collected under any of its taxes imposed pursuant to
subparagraph 1 of Section 8-11-2 of the Illinois Municipal
Code, Section 8-11-17 of the Illinois Municipal Code, or
Section 20 of the Telecommunications Infrastructure
Maintenance Fee Act as shown on the list described in Section
5-25 of this Act, then the equivalent portion of revenues
collected from the tax authorized by this Act shall be deemed
pledged or dedicated in a manner substantially similar to the
pledge of the then existing taxes so as to prevent disruption
of such contract.
Section 5-60. Waiver of franchise fees.
(a) Any municipality shall be deemed to have waived its
right to receive all fees, charges and other compensation
that might accrue to the municipality after the effective
date of this Act, under any franchise agreement, license, or
similar agreement, executed on or before January 1, 1998 with
telecommunications retailers if:
(1) the municipality imposes the tax authorized by
this Act at a rate exceeding 5%;
(2) the municipality affirmatively waives such
fees; or
(3) the municipality is included in the list
described in Section 5-25 of this Act as having an
infrastructure maintenance fee in place.
(b) This waiver shall be effective only during the time
that either the infrastructure maintenance fee or the
simplified tax authorized under this Act is subject to being
lawfully imposed on the telecommunications retailer,
collected by the municipality or the Department, and paid
over to the municipality.
(c) No portion of this Act shall be construed to have
repealed or amended the prohibition on franchise fees or
other charges set forth in Section 30 of the
Telecommunications Infrastructure Maintenance Fee Act.
Section 5-65. Incorporation by reference. On and after
January 1, 2003, for municipalities with populations of less
than 500,000, all of the provisions of Sections 7, 10, 11,
12, 13, 14, 15, 16, 17, 18, and 19 of the Telecommunications
Excise Tax Act, Sections 4, 5, 5a, 5b, 5c, 5d, 5e, 5f, 5g,
5i, 5j, 6, 6a, 6b, and 6c of the Retailers' Occupation Tax
Act, and all the provisions of the Uniform Penalty and
Interest Act, which are not inconsistent with this Act, shall
apply, as far as practicable, to the subject matter of this
Act to the same extent as if such provisions were included
herein. References in such incorporated Sections of the
Retailers' Occupation Tax Act to retailers, to sellers, or to
persons engaged in the business of selling tangible personal
property mean retailers, as defined in this Act, or persons
engaged in the act or privilege of originating or receiving
telecommunications. References in such incorporated Sections
of the Retailers' Occupation Tax Act to purchasers of
tangible personal property mean purchasers of
telecommunications as defined in this Act. References in
such incorporated Sections of the Retailers' Occupation Tax
Act to sales of tangible personal property mean the act or
privilege of originating or receiving telecommunications as
defined in this Act.
Section 5-90. Home rule. The authorization to impose
municipal telecommunications taxes and fees is an exclusive
power and function of the State. A home rule municipality
may not impose municipal telecommunications taxes and fees
other than as authorized under this Act. This Act is a
denial and limitation of municipal home rule powers and
functions under subsection (g) of Section 6 of Article VII of
the Illinois Constitution.
ARTICLE 90
Section 90-5. The State Revenue Sharing Act is amended
by changing Section 12 as follows:
(30 ILCS 115/12) (from Ch. 85, par. 616)
Sec. 12. Personal Property Tax Replacement Fund. There
is hereby created the Personal Property Tax Replacement Fund,
a special fund in the State Treasury into which shall be paid
all revenue realized:
(a) all amounts realized from the additional personal
property tax replacement income tax imposed by subsections
(c) and (d) of Section 201 of the Illinois Income Tax Act,
except for those amounts deposited into the Income Tax Refund
Fund pursuant to subsection (c) of Section 901 of the
Illinois Income Tax Act; and
(b) all amounts realized from the additional personal
property replacement invested capital taxes imposed by
Section 2a.1 of the Messages Tax Act, Section 2a.1 of the Gas
Revenue Tax Act, Section 2a.1 of the Public Utilities
Revenue Act, and Section 3 of the Water Company Invested
Capital Tax Act, and amounts payable to the Department of
Revenue under the Telecommunications Municipal Infrastructure
Maintenance Fee Act.
As soon as may be after the end of each month, the
Department of Revenue shall certify to the Treasurer and the
Comptroller the amount of all refunds paid out of the General
Revenue Fund through the preceding month on account of
overpayment of liability on taxes paid into the Personal
Property Tax Replacement Fund. Upon receipt of such
certification, the Treasurer and the Comptroller shall
transfer the amount so certified from the Personal Property
Tax Replacement Fund into the General Revenue Fund.
The payments of revenue into the Personal Property Tax
Replacement Fund shall be used exclusively for distribution
to taxing districts as provided in this Section, payment of
the expenses of the Department of Revenue incurred in
administering the collection and distribution of monies paid
into the Personal Property Tax Replacement Fund and transfers
due to refunds to taxpayers for overpayment of liability for
taxes paid into the Personal Property Tax Replacement Fund.
As soon as may be after the effective date of this
amendatory Act of 1980, the Department of Revenue shall
certify to the Treasurer the amount of net replacement
revenue paid into the General Revenue Fund prior to that
effective date from the additional tax imposed by Section
2a.1 of the Messages Tax Act; Section 2a.1 of the Gas Revenue
Tax Act; Section 2a.1 of the Public Utilities Revenue Act;
Section 3 of the Water Company Invested Capital Tax Act;
amounts collected by the Department of Revenue under the
Telecommunications Municipal Infrastructure Maintenance Fee
Act; and the additional personal property tax replacement
income tax imposed by the Illinois Income Tax Act, as amended
by Public Act 81-1st Special Session-1. Net replacement
revenue shall be defined as the total amount paid into and
remaining in the General Revenue Fund as a result of those
Acts minus the amount outstanding and obligated from the
General Revenue Fund in state vouchers or warrants prior to
the effective date of this amendatory Act of 1980 as refunds
to taxpayers for overpayment of liability under those Acts.
All interest earned by monies accumulated in the Personal
Property Tax Replacement Fund shall be deposited in such
Fund. All amounts allocated pursuant to this Section are
appropriated on a continuing basis.
Prior to December 31, 1980, as soon as may be after the
end of each quarter beginning with the quarter ending
December 31, 1979, and on and after December 31, 1980, as
soon as may be after January 1, March 1, April 1, May 1, July
1, August 1, October 1 and December 1 of each year, the
Department of Revenue shall allocate to each taxing district
as defined in Section 1-150 of the Property Tax Code, in
accordance with the provisions of paragraph (2) of this
Section the portion of the funds held in the Personal
Property Tax Replacement Fund which is required to be
distributed, as provided in paragraph (1), for each quarter.
Provided, however, under no circumstances shall any taxing
district during each of the first two years of distribution
of the taxes imposed by this amendatory Act of 1979 be
entitled to an annual allocation which is less than the funds
such taxing district collected from the 1978 personal
property tax. Provided further that under no circumstances
shall any taxing district during the third year of
distribution of the taxes imposed by this amendatory Act of
1979 receive less than 60% of the funds such taxing district
collected from the 1978 personal property tax. In the event
that the total of the allocations made as above provided for
all taxing districts, during either of such 3 years, exceeds
the amount available for distribution the allocation of each
taxing district shall be proportionately reduced. Except as
provided in Section 13 of this Act, the Department shall then
certify, pursuant to appropriation, such allocations to the
State Comptroller who shall pay over to the several taxing
districts the respective amounts allocated to them.
Any township which receives an allocation based in whole
or in part upon personal property taxes which it levied
pursuant to Section 6-507 or 6-512 of the Illinois Highway
Code and which was previously required to be paid over to a
municipality shall immediately pay over to that municipality
a proportionate share of the personal property replacement
funds which such township receives.
Any municipality or township, other than a municipality
with a population in excess of 500,000, which receives an
allocation based in whole or in part on personal property
taxes which it levied pursuant to Sections 3-1, 3-4 and 3-6
of the Illinois Local Library Act and which was previously
required to be paid over to a public library shall
immediately pay over to that library a proportionate share of
the personal property tax replacement funds which such
municipality or township receives; provided that if such a
public library has converted to a library organized under The
Illinois Public Library District Act, regardless of whether
such conversion has occurred on, after or before January 1,
1988, such proportionate share shall be immediately paid over
to the library district which maintains and operates the
library. However, any library that has converted prior to
January 1, 1988, and which hitherto has not received the
personal property tax replacement funds, shall receive such
funds commencing on January 1, 1988.
Any township which receives an allocation based in whole
or in part on personal property taxes which it levied
pursuant to Section 1c of the Public Graveyards Act and which
taxes were previously required to be paid over to or used for
such public cemetery or cemeteries shall immediately pay over
to or use for such public cemetery or cemeteries a
proportionate share of the personal property tax replacement
funds which the township receives.
Any taxing district which receives an allocation based in
whole or in part upon personal property taxes which it levied
for another governmental body or school district in Cook
County in 1976 or for another governmental body or school
district in the remainder of the State in 1977 shall
immediately pay over to that governmental body or school
district the amount of personal property replacement funds
which such governmental body or school district would receive
directly under the provisions of paragraph (2) of this
Section, had it levied its own taxes.
(1) The portion of the Personal Property Tax Replacement
Fund required to be distributed as of the time allocation is
required to be made shall be the amount available in such
Fund as of the time allocation is required to be made.
The amount available for distribution shall be the total
amount in the fund at such time minus the necessary
administrative expenses as limited by the appropriation and
the amount determined by: (a) $2.8 million for fiscal year
1981; (b) for fiscal year 1982, .54% of the funds distributed
from the fund during the preceding fiscal year; (c) for
fiscal year 1983 through fiscal year 1988, .54% of the funds
distributed from the fund during the preceding fiscal year
less .02% of such fund for fiscal year 1983 and less .02% of
such funds for each fiscal year thereafter, or (d) for fiscal
year 1989 and beyond no more than 105% of the actual
administrative expenses of the prior fiscal year. Such
portion of the fund shall be determined after the transfer
into the General Revenue Fund due to refunds, if any, paid
from the General Revenue Fund during the preceding quarter.
If at any time, for any reason, there is insufficient amount
in the Personal Property Tax Replacement Fund for payment of
costs of administration or for transfers due to refunds at
the end of any particular month, the amount of such
insufficiency shall be carried over for the purposes of
transfers into the General Revenue Fund and for purposes of
costs of administration to the following month or months.
Net replacement revenue held, and defined above, shall be
transferred by the Treasurer and Comptroller to the Personal
Property Tax Replacement Fund within 10 days of such
certification.
(2) Each quarterly allocation shall first be apportioned
in the following manner: 51.65% for taxing districts in Cook
County and 48.35% for taxing districts in the remainder of
the State.
The Personal Property Replacement Ratio of each taxing
district outside Cook County shall be the ratio which the Tax
Base of that taxing district bears to the Downstate Tax Base.
The Tax Base of each taxing district outside of Cook County
is the personal property tax collections for that taxing
district for the 1977 tax year. The Downstate Tax Base is
the personal property tax collections for all taxing
districts in the State outside of Cook County for the 1977
tax year. The Department of Revenue shall have authority to
review for accuracy and completeness the personal property
tax collections for each taxing district outside Cook County
for the 1977 tax year.
The Personal Property Replacement Ratio of each Cook
County taxing district shall be the ratio which the Tax Base
of that taxing district bears to the Cook County Tax Base.
The Tax Base of each Cook County taxing district is the
personal property tax collections for that taxing district
for the 1976 tax year. The Cook County Tax Base is the
personal property tax collections for all taxing districts in
Cook County for the 1976 tax year. The Department of Revenue
shall have authority to review for accuracy and completeness
the personal property tax collections for each taxing
district within Cook County for the 1976 tax year.
For all purposes of this Section 12, amounts paid to a
taxing district for such tax years as may be applicable by a
foreign corporation under the provisions of Section 7-202 of
the Public Utilities Act, as amended, shall be deemed to be
personal property taxes collected by such taxing district for
such tax years as may be applicable. The Director shall
determine from the Illinois Commerce Commission, for any tax
year as may be applicable, the amounts so paid by any such
foreign corporation to any and all taxing districts. The
Illinois Commerce Commission shall furnish such information
to the Director. For all purposes of this Section 12, the
Director shall deem such amounts to be collected personal
property taxes of each such taxing district for the
applicable tax year or years.
Taxing districts located both in Cook County and in one
or more other counties shall receive both a Cook County
allocation and a Downstate allocation determined in the same
way as all other taxing districts.
If any taxing district in existence on July 1, 1979
ceases to exist, or discontinues its operations, its Tax Base
shall thereafter be deemed to be zero. If the powers, duties
and obligations of the discontinued taxing district are
assumed by another taxing district, the Tax Base of the
discontinued taxing district shall be added to the Tax Base
of the taxing district assuming such powers, duties and
obligations.
If two or more taxing districts in existence on July 1,
1979, or a successor or successors thereto shall consolidate
into one taxing district, the Tax Base of such consolidated
taxing district shall be the sum of the Tax Bases of each of
the taxing districts which have consolidated.
If a single taxing district in existence on July 1, 1979,
or a successor or successors thereto shall be divided into
two or more separate taxing districts, the tax base of the
taxing district so divided shall be allocated to each of the
resulting taxing districts in proportion to the then current
equalized assessed value of each resulting taxing district.
If a portion of the territory of a taxing district is
disconnected and annexed to another taxing district of the
same type, the Tax Base of the taxing district from which
disconnection was made shall be reduced in proportion to the
then current equalized assessed value of the disconnected
territory as compared with the then current equalized
assessed value within the entire territory of the taxing
district prior to disconnection, and the amount of such
reduction shall be added to the Tax Base of the taxing
district to which annexation is made.
If a community college district is created after July 1,
1979, beginning on the effective date of this amendatory Act
of 1995, its Tax Base shall be 3.5% of the sum of the
personal property tax collected for the 1977 tax year within
the territorial jurisdiction of the district.
The amounts allocated and paid to taxing districts
pursuant to the provisions of this amendatory Act of 1979
shall be deemed to be substitute revenues for the revenues
derived from taxes imposed on personal property pursuant to
the provisions of the "Revenue Act of 1939" or "An Act for
the assessment and taxation of private car line companies",
approved July 22, 1943, as amended, or Section 414 of the
Illinois Insurance Code, prior to the abolition of such taxes
and shall be used for the same purposes as the revenues
derived from ad valorem taxes on real estate.
Monies received by any taxing districts from the Personal
Property Tax Replacement Fund shall be first applied toward
payment of the proportionate amount of debt service which was
previously levied and collected from extensions against
personal property on bonds outstanding as of December 31,
1978 and next applied toward payment of the proportionate
share of the pension or retirement obligations of the taxing
district which were previously levied and collected from
extensions against personal property. For each such
outstanding bond issue, the County Clerk shall determine the
percentage of the debt service which was collected from
extensions against real estate in the taxing district for
1978 taxes payable in 1979, as related to the total amount of
such levies and collections from extensions against both real
and personal property. For 1979 and subsequent years' taxes,
the County Clerk shall levy and extend taxes against the real
estate of each taxing district which will yield the said
percentage or percentages of the debt service on such
outstanding bonds. The balance of the amount necessary to
fully pay such debt service shall constitute a first and
prior lien upon the monies received by each such taxing
district through the Personal Property Tax Replacement Fund
and shall be first applied or set aside for such purpose. In
counties having fewer than 3,000,000 inhabitants, the
amendments to this paragraph as made by this amendatory Act
of 1980 shall be first applicable to 1980 taxes to be
collected in 1981.
(Source: P.A. 89-327, eff. 1-1-96; 90-154, eff. 1-1-98.)
Section 90-10. The Telecommunications Excise Tax Act is
amended by changing Sections 2, 6, and 15 as follows:
(35 ILCS 630/2) (from Ch. 120, par. 2002)
(Text of Section before amendment by P.A. 92-474)
Sec. 2. As used in this Article, unless the context
clearly requires otherwise:
(a) "Gross charge" means the amount paid for the act or
privilege of originating or receiving telecommunications in
this State and for all services and equipment provided in
connection therewith by a retailer, valued in money whether
paid in money or otherwise, including cash, credits, services
and property of every kind or nature, and shall be determined
without any deduction on account of the cost of such
telecommunications, the cost of materials used, labor or
service costs or any other expense whatsoever. In case
credit is extended, the amount thereof shall be included only
as and when paid. "Gross charges" for private line service
shall include charges imposed at each channel point within
this State, charges for the channel mileage between each
channel point within this State, and charges for that portion
of the interstate inter-office channel provided within
Illinois. However, "gross charges" shall not include:
(1) any amounts added to a purchaser's bill because
of a charge made pursuant to (i) the tax imposed by this
Article; (ii) charges added to customers' bills pursuant
to the provisions of Sections 9-221 or 9-222 of the
Public Utilities Act, as amended, or any similar charges
added to customers' bills by retailers who are not
subject to rate regulation by the Illinois Commerce
Commission for the purpose of recovering any of the tax
liabilities or other amounts specified in such provisions
of such Act; or (iii) the tax imposed by Section 4251 of
the Internal Revenue Code; (iv) 911 surcharges; or (v)
the tax imposed by the Simplified Municipal
Telecommunications Tax Act;
(2) charges for a sent collect telecommunication
received outside of the State;
(3) charges for leased time on equipment or charges
for the storage of data or information for subsequent
retrieval or the processing of data or information
intended to change its form or content. Such equipment
includes, but is not limited to, the use of calculators,
computers, data processing equipment, tabulating
equipment or accounting equipment and also includes the
usage of computers under a time-sharing agreement;
(4) charges for customer equipment, including such
equipment that is leased or rented by the customer from
any source, wherein such charges are disaggregated and
separately identified from other charges;
(5) charges to business enterprises certified under
Section 9-222.1 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;
(6) charges for telecommunications and all services
and equipment provided in connection therewith between a
parent corporation and its wholly owned subsidiaries or
between wholly owned subsidiaries when the tax imposed
under this Article has already been paid to a retailer
and only to the extent that the charges between the
parent corporation and wholly owned subsidiaries or
between wholly owned subsidiaries represent expense
allocation between the corporations and not the
generation of profit for the corporation rendering such
service;
(7) bad debts. Bad debt means any portion of a debt
that is related to a sale at retail for which gross
charges are not otherwise deductible or excludable that
has become worthless or uncollectable, as determined
under applicable federal income tax standards. If the
portion of the debt deemed to be bad is subsequently
paid, the retailer shall report and pay the tax on that
portion during the reporting period in which the payment
is made;
(8) charges paid by inserting coins in
coin-operated telecommunication devices;
(9) amounts paid by telecommunications retailers
under the Telecommunications Municipal Infrastructure
Maintenance Fee Act.
(b) "Amount paid" means the amount charged to the
taxpayer's service address in this State regardless of where
such amount is billed or paid.
(c) "Telecommunications", in addition to the meaning
ordinarily and popularly ascribed to it, includes, without
limitation, messages or information transmitted through use
of local, toll and wide area telephone service; private line
services; channel services; telegraph services;
teletypewriter; computer exchange services; cellular mobile
telecommunications service; specialized mobile radio;
stationary two way radio; paging service; or any other form
of mobile and portable one-way or two-way communications; or
any other transmission of messages or information by
electronic or similar means, between or among points by wire,
cable, fiber-optics, laser, microwave, radio, satellite or
similar facilities. As used in this Act, "private line" means
a dedicated non-traffic sensitive service for a single
customer, that entitles the customer to exclusive or priority
use of a communications channel or group of channels, from
one or more specified locations to one or more other
specified locations. The definition of "telecommunications"
shall not include value added services in which computer
processing applications are used to act on the form, content,
code and protocol of the information for purposes other than
transmission. "Telecommunications" shall not include
purchases of telecommunications by a telecommunications
service provider for use as a component part of the service
provided by him to the ultimate retail consumer who
originates or terminates the taxable end-to-end
communications. Carrier access charges, right of access
charges, charges for use of inter-company facilities, and all
telecommunications resold in the subsequent provision of,
used as a component of, or integrated into end-to-end
telecommunications service shall be non-taxable as sales for
resale.
(d) "Interstate telecommunications" means all
telecommunications that either originate or terminate outside
this State.
(e) "Intrastate telecommunications" means all
telecommunications that originate and terminate within this
State.
(f) "Department" means the Department of Revenue of the
State of Illinois.
(g) "Director" means the Director of Revenue for the
Department of Revenue of the State of Illinois.
(h) "Taxpayer" means a person who individually or
through his agents, employees or permittees engages in the
act or privilege of originating or receiving
telecommunications in this State and who incurs a tax
liability under this Article.
(i) "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, the Federal and State governments,
including State universities created by statute or any city,
town, county or other political subdivision of this State.
(j) "Purchase at retail" means the acquisition,
consumption or use of telecommunication through a sale at
retail.
(k) "Sale at retail" means the transmitting, supplying
or furnishing of telecommunications and all services and
equipment provided in connection therewith for a
consideration to persons other than the Federal and State
governments, and State universities created by statute and
other than between a parent corporation and its wholly owned
subsidiaries or between wholly owned subsidiaries for their
use or consumption and not for resale.
(l) "Retailer" means and includes every person engaged
in the business of making sales at retail as defined in this
Article. The Department may, in its discretion, upon
application, authorize the collection of the tax hereby
imposed by any retailer not maintaining a place of business
within this State, who, to the satisfaction of the
Department, furnishes adequate security to insure collection
and payment of the tax. Such retailer shall be issued,
without charge, a permit to collect such tax. When so
authorized, it shall be the duty of such retailer to collect
the tax upon all of the gross charges for telecommunications
in this State in the same manner and subject to the same
requirements as a retailer maintaining a place of business
within this State. The permit may be revoked by the
Department at its discretion.
(m) "Retailer maintaining a place of business in this
State", or any like term, means and includes any retailer
having or maintaining within this State, directly or by a
subsidiary, an office, distribution facilities, transmission
facilities, sales office, warehouse or other place of
business, or any agent or other representative operating
within this State under the authority of the retailer or its
subsidiary, irrespective of whether such place of business or
agent or other representative is located here permanently or
temporarily, or whether such retailer or subsidiary is
licensed to do business in this State.
(n) "Service address" means the location of
telecommunications equipment from which the
telecommunications services are originated or at which
telecommunications services are received by a taxpayer. In
the event this may not be a defined location, as in the case
of mobile phones, paging systems, maritime systems,
air-to-ground systems and the like, service address shall
mean the location of a taxpayer's primary use of the
telecommunications equipment as defined by telephone number,
authorization code, or location in Illinois where bills are
sent.
(o) "Prepaid telephone calling arrangements" mean the
right to exclusively purchase telephone or telecommunications
services that must be paid for in advance and enable the
origination of one or more intrastate, interstate, or
international telephone calls or other telecommunications
using an access number, an authorization code, or both,
whether manually or electronically dialed, for which payment
to a retailer must be made in advance, provided that, unless
recharged, no further service is provided once that prepaid
amount of service has been consumed. Prepaid telephone
calling arrangements include the recharge of a prepaid
calling arrangement. For purposes of this subsection,
"recharge" means the purchase of additional prepaid telephone
or telecommunications services whether or not the purchaser
acquires a different access number or authorization code.
"Prepaid telephone calling arrangement" does not include an
arrangement whereby a customer purchases a payment card and
pursuant to which the service provider reflects the amount of
such purchase as a credit on an invoice issued to that
customer under an existing subscription plan.
(Source: P.A. 90-562, eff. 12-16-97; 91-870, eff. 6-22-00.)
(Text of Section after amendment by P.A. 92-474)
Sec. 2. As used in this Article, unless the context
clearly requires otherwise:
(a) "Gross charge" means the amount paid for the act or
privilege of originating or receiving telecommunications in
this State and for all services and equipment provided in
connection therewith by a retailer, valued in money whether
paid in money or otherwise, including cash, credits, services
and property of every kind or nature, and shall be determined
without any deduction on account of the cost of such
telecommunications, the cost of materials used, labor or
service costs or any other expense whatsoever. In case
credit is extended, the amount thereof shall be included only
as and when paid. "Gross charges" for private line service
shall include charges imposed at each channel point within
this State, charges for the channel mileage between each
channel point within this State, and charges for that portion
of the interstate inter-office channel provided within
Illinois. However, "gross charges" shall not include:
(1) any amounts added to a purchaser's bill because
of a charge made pursuant to (i) the tax imposed by this
Article; (ii) charges added to customers' bills pursuant
to the provisions of Sections 9-221 or 9-222 of the
Public Utilities Act, as amended, or any similar charges
added to customers' bills by retailers who are not
subject to rate regulation by the Illinois Commerce
Commission for the purpose of recovering any of the tax
liabilities or other amounts specified in such provisions
of such Act; or (iii) the tax imposed by Section 4251 of
the Internal Revenue Code; (iv) 911 surcharges; or (v)
the tax imposed by the Simplified Municipal
Telecommunications Tax Act;
(2) charges for a sent collect telecommunication
received outside of the State;
(3) charges for leased time on equipment or charges
for the storage of data or information for subsequent
retrieval or the processing of data or information
intended to change its form or content. Such equipment
includes, but is not limited to, the use of calculators,
computers, data processing equipment, tabulating
equipment or accounting equipment and also includes the
usage of computers under a time-sharing agreement;
(4) charges for customer equipment, including such
equipment that is leased or rented by the customer from
any source, wherein such charges are disaggregated and
separately identified from other charges;
(5) charges to business enterprises certified under
Section 9-222.1 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;
(6) charges for telecommunications and all services
and equipment provided in connection therewith between a
parent corporation and its wholly owned subsidiaries or
between wholly owned subsidiaries when the tax imposed
under this Article has already been paid to a retailer
and only to the extent that the charges between the
parent corporation and wholly owned subsidiaries or
between wholly owned subsidiaries represent expense
allocation between the corporations and not the
generation of profit for the corporation rendering such
service;
(7) bad debts. Bad debt means any portion of a debt
that is related to a sale at retail for which gross
charges are not otherwise deductible or excludable that
has become worthless or uncollectable, as determined
under applicable federal income tax standards. If the
portion of the debt deemed to be bad is subsequently
paid, the retailer shall report and pay the tax on that
portion during the reporting period in which the payment
is made;
(8) charges paid by inserting coins in
coin-operated telecommunication devices;
(9) amounts paid by telecommunications retailers
under the Telecommunications Municipal Infrastructure
Maintenance Fee Act.
(b) "Amount paid" means the amount charged to the
taxpayer's service address in this State regardless of where
such amount is billed or paid.
(c) "Telecommunications", in addition to the meaning
ordinarily and popularly ascribed to it, includes, without
limitation, messages or information transmitted through use
of local, toll and wide area telephone service; private line
services; channel services; telegraph services;
teletypewriter; computer exchange services; cellular mobile
telecommunications service; specialized mobile radio;
stationary two way radio; paging service; or any other form
of mobile and portable one-way or two-way communications; or
any other transmission of messages or information by
electronic or similar means, between or among points by wire,
cable, fiber-optics, laser, microwave, radio, satellite or
similar facilities. As used in this Act, "private line" means
a dedicated non-traffic sensitive service for a single
customer, that entitles the customer to exclusive or priority
use of a communications channel or group of channels, from
one or more specified locations to one or more other
specified locations. The definition of "telecommunications"
shall not include value added services in which computer
processing applications are used to act on the form, content,
code and protocol of the information for purposes other than
transmission. "Telecommunications" shall not include
purchases of telecommunications by a telecommunications
service provider for use as a component part of the service
provided by him to the ultimate retail consumer who
originates or terminates the taxable end-to-end
communications. Carrier access charges, right of access
charges, charges for use of inter-company facilities, and all
telecommunications resold in the subsequent provision of,
used as a component of, or integrated into end-to-end
telecommunications service shall be non-taxable as sales for
resale.
(d) "Interstate telecommunications" means all
telecommunications that either originate or terminate outside
this State.
(e) "Intrastate telecommunications" means all
telecommunications that originate and terminate within this
State.
(f) "Department" means the Department of Revenue of the
State of Illinois.
(g) "Director" means the Director of Revenue for the
Department of Revenue of the State of Illinois.
(h) "Taxpayer" means a person who individually or
through his agents, employees or permittees engages in the
act or privilege of originating or receiving
telecommunications in this State and who incurs a tax
liability under this Article.
(i) "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, the Federal and State governments,
including State universities created by statute or any city,
town, county or other political subdivision of this State.
(j) "Purchase at retail" means the acquisition,
consumption or use of telecommunication through a sale at
retail.
(k) "Sale at retail" means the transmitting, supplying
or furnishing of telecommunications and all services and
equipment provided in connection therewith for a
consideration to persons other than the Federal and State
governments, and State universities created by statute and
other than between a parent corporation and its wholly owned
subsidiaries or between wholly owned subsidiaries for their
use or consumption and not for resale.
(l) "Retailer" means and includes every person engaged
in the business of making sales at retail as defined in this
Article. The Department may, in its discretion, upon
application, authorize the collection of the tax hereby
imposed by any retailer not maintaining a place of business
within this State, who, to the satisfaction of the
Department, furnishes adequate security to insure collection
and payment of the tax. Such retailer shall be issued,
without charge, a permit to collect such tax. When so
authorized, it shall be the duty of such retailer to collect
the tax upon all of the gross charges for telecommunications
in this State in the same manner and subject to the same
requirements as a retailer maintaining a place of business
within this State. The permit may be revoked by the
Department at its discretion.
(m) "Retailer maintaining a place of business in this
State", or any like term, means and includes any retailer
having or maintaining within this State, directly or by a
subsidiary, an office, distribution facilities, transmission
facilities, sales office, warehouse or other place of
business, or any agent or other representative operating
within this State under the authority of the retailer or its
subsidiary, irrespective of whether such place of business or
agent or other representative is located here permanently or
temporarily, or whether such retailer or subsidiary is
licensed to do business in this State.
(n) "Service address" means the location of
telecommunications equipment from which the
telecommunications services are originated or at which
telecommunications services are received by a taxpayer. In
the event this may not be a defined location, as in the case
of mobile phones, paging systems, maritime systems, service
address means the customer's place of primary use as defined
in the Mobile Telecommunications Sourcing Conformity Act.
For air-to-ground systems and the like, service address shall
mean the location of a taxpayer's primary use of the
telecommunications equipment as defined by telephone number,
authorization code, or location in Illinois where bills are
sent.
(o) "Prepaid telephone calling arrangements" mean the
right to exclusively purchase telephone or telecommunications
services that must be paid for in advance and enable the
origination of one or more intrastate, interstate, or
international telephone calls or other telecommunications
using an access number, an authorization code, or both,
whether manually or electronically dialed, for which payment
to a retailer must be made in advance, provided that, unless
recharged, no further service is provided once that prepaid
amount of service has been consumed. Prepaid telephone
calling arrangements include the recharge of a prepaid
calling arrangement. For purposes of this subsection,
"recharge" means the purchase of additional prepaid telephone
or telecommunications services whether or not the purchaser
acquires a different access number or authorization code.
"Prepaid telephone calling arrangement" does not include an
arrangement whereby a customer purchases a payment card and
pursuant to which the service provider reflects the amount of
such purchase as a credit on an invoice issued to that
customer under an existing subscription plan.
(Source: P.A. 91-870, eff. 6-22-00; 92-474, eff. 8-1-02.)
(35 ILCS 630/6) (from Ch. 120, par. 2006)
Sec. 6. Except as provided hereinafter in this Section,
on or before the last 15th day of each month, each retailer
maintaining a place of business in this State shall make a
return to the Department for the preceding calendar month,
stating:
1. His name;
2. The address of his principal place of business,
or and the address of the principal place of business (if
that is a different address) from which he engages in the
business of transmitting telecommunications;
3. Total amount of gross charges billed by him
during the preceding calendar month for providing
telecommunications during such calendar month;
4. Total amount received by him during the
preceding calendar month on credit extended;
5. Deductions allowed by law;
6. Gross charges which were billed by him during
the preceding calendar month and upon the basis of which
the tax is imposed;
7. Amount of tax (computed upon Item 6);
8. Such other reasonable information as the
Department may require.
Any taxpayer required to make payments under this Section
may make the payments by electronic funds transfer. The
Department shall adopt rules necessary to effectuate a
program of electronic funds transfer. Any taxpayer who has
average monthly tax billings due to the Department under this
Act and the Simplified Municipal Telecommunications Tax Act
that exceed $1,000 shall make all payments by electronic
funds transfer as required by rules of the Department and
shall file the return required by this Section by electronic
means as required by rules of the Department.
If the retailer's average monthly tax billings due to the
Department under this Act and the Simplified Municipal
Telecommunications Tax Act do not exceed $1,000 $200, the
Department may authorize his returns to be filed on a quarter
annual basis, with the return for January, February and March
of a given year being due by April 30 15 of such year; with
the return for April, May and June of a given year being due
by July 31st 15 of such year; with the return for July,
August and September of a given year being due by October
31st 15 of such year; and with the return of October,
November and December of a given year being due by January
31st 15 of the following year.
If the retailer is otherwise required to file a monthly
or quarterly return and if the retailer's average monthly tax
billings due to the Department under this Act and the
Simplified Municipal Telecommunications Tax Act do not exceed
$400 $50, the Department may authorize his or her return to
be filed on an annual basis, with the return for a given year
being due by January 31st 15th of the following year.
Notwithstanding any other provision of this Article
containing the time within which a retailer may file his
return, in the case of any retailer who ceases to engage in a
kind of business which makes him responsible for filing
returns under this Article, such retailer shall file a final
return under this Article with the Department not more than
one month after discontinuing such business.
In making such return, the retailer shall determine the
value of any consideration other than money received by him
and he shall include such value in his return. Such
determination shall be subject to review and revision by the
Department in the manner hereinafter provided for the
correction of returns.
Each retailer whose average monthly liability to the
Department under this Article and the Simplified Municipal
Telecommunications Tax Act was $25,000 $10,000 or more during
the preceding calendar year, excluding the month of highest
liability and the month of lowest liability in such calendar
year, and who is not operated by a unit of local government,
shall make estimated payments to the Department on or before
the 7th, 15th, 22nd and last day of the month during which
tax collection liability to the Department is incurred in an
amount not less than the lower of either 22.5% of the
retailer's actual tax collections for the month or 25% of the
retailer's actual tax collections for the same calendar month
of the preceding year. The amount of such quarter monthly
payments shall be credited against the final liability of the
retailer's return for that month. Any outstanding credit,
approved by the Department, arising from the retailer's
overpayment of its final liability for any month may be
applied to reduce the amount of any subsequent quarter
monthly payment or credited against the final liability of
the retailer's return for any subsequent month. If any
quarter monthly payment is not paid at the time or in the
amount required by this Section, the retailer shall be liable
for penalty and interest on the difference between the
minimum amount due as a payment and the amount of such
payment actually and timely paid, except insofar as the
retailer has previously made payments for that month to the
Department in excess of the minimum payments previously due.
If the Director finds that the information required for
the making of an accurate return cannot reasonably be
compiled by a retailer within 15 days after the close of the
calendar month for which a return is to be made, he may grant
an extension of time for the filing of such return for a
period of not to exceed 31 calendar days. The granting of
such an extension may be conditioned upon the deposit by the
retailer with the Department of an amount of money not
exceeding the amount estimated by the Director to be due with
the return so extended. All such deposits, including any
heretofore made with the Department, shall be credited
against the retailer's liabilities under this Article. If
any such deposit exceeds the retailer's present and probable
future liabilities under this Article, the Department shall
issue to the retailer a credit memorandum, which may be
assigned by the retailer to a similar retailer under this
Article, in accordance with reasonable rules and regulations
to be prescribed by the Department.
The retailer making the return herein provided for shall,
at the time of making such return, pay to the Department the
amount of tax herein imposed, less a discount of 1% which is
allowed to reimburse the retailer for the expenses incurred
in keeping records, billing the customer, preparing and
filing returns, remitting the tax, and supplying data to the
Department upon request. No discount may be claimed by a
retailer on returns not timely filed and for taxes not timely
remitted. On and after the effective date of this Article of
1985, $1,000,000 of the moneys received by the Department of
Revenue pursuant to this Article shall be paid each month
into the Common School Fund and the remainder into the
General Revenue Fund. On and after February 1, 1998, however,
of the moneys received by the Department of Revenue pursuant
to the additional taxes imposed by this amendatory Act of
1997 one-half shall be deposited into the School
Infrastructure Fund and one-half shall be deposited into the
Common School Fund. On and after the effective date of this
amendatory Act of the 91st General Assembly, if in any fiscal
year the total of the moneys deposited into the School
Infrastructure Fund under this Act is less than the total of
the moneys deposited into that Fund from the additional taxes
imposed by Public Act 90-548 during fiscal year 1999, then,
as soon as possible after the close of the fiscal year, the
Comptroller shall order transferred and the Treasurer shall
transfer from the General Revenue Fund to the School
Infrastructure Fund an amount equal to the difference between
the fiscal year total deposits and the total amount deposited
into the Fund in fiscal year 1999.
(Source: P.A. 90-16, eff. 6-16-97; 90-548, eff. 12-4-97;
91-541, eff. 8-13-99; 91-870, 6-22-00.)
(35 ILCS 630/15) (from Ch. 120, par. 2015)
Sec. 15. Confidential information. All information
received by the Department from returns filed under this
Article, or from any investigations conducted under this
Article, shall be confidential, except for official purposes,
and any person who divulges any such information in any
manner, except in accordance with a proper judicial order or
as otherwise provided by law, shall be guilty of a Class B
misdemeanor.
Provided, that nothing contained in this Article shall
prevent the Director from publishing or making available to
the public the names and addresses of retailers or taxpayers
filing returns under this Article, or from publishing or
making available reasonable statistics concerning the
operation of the tax wherein the contents of returns are
grouped into aggregates in such a way that the information
contained in any individual return shall not be disclosed.
And provided, that nothing contained in this Article
shall prevent the Director from making available to the
United States Government or the government of any other
state, or any officer or agency thereof, for exclusively
official purposes, information received by the Department in
the administration of this Article, if such other
governmental agency agrees to divulge requested tax
information to the Department.
The furnishing upon request of the Auditor General, or
his authorized agents, for official use, of returns filed and
information related thereto under this Article is deemed to
be an official purpose within the meaning of this Section.
The furnishing of financial information to a municipality
that has imposed a tax under the Simplified Municipal
Telecommunications Tax Act, upon request of the chief
executive thereof, is an official purpose within the meaning
of this Section, provided that the municipality agrees in
writing to the requirements of this Section. Information so
provided shall be subject to all confidentiality provisions
of this Section. The written agreement shall provide for
reciprocity, limitations on access, disclosure, and
procedures for requesting information.
The Director shall make available for public inspection
in the Department's principal office and for publication, at
cost, administrative decisions issued on or after January 1,
1995. These decisions are to be made available in a manner so
that the following taxpayer information is not disclosed:
(1) The names, addresses, and identification
numbers of the taxpayer, related entities, and employees.
(2) At the sole discretion of the Director, trade
secrets or other confidential information identified as
such by the taxpayer, no later than 30 days after receipt
of an administrative decision, by such means as the
Department shall provide by rule.
The Director shall determine the appropriate extent of
the deletions allowed in paragraph (2). In the event the
taxpayer does not submit deletions, the Director shall make
only the deletions specified in paragraph (1).
The Director shall make available for public inspection
and publication an administrative decision within 180 days
after the issuance of the administrative decision. The term
"administrative decision" has the same meaning as defined in
Section 3-101 of Article III of the Code of Civil Procedure.
Costs collected under this Section shall be paid into the Tax
Compliance and Administration Fund.
Nothing contained in this Act shall prevent the Director
from divulging information to any person pursuant to a
request or authorization made by the taxpayer or by an
authorized representative of the taxpayer.
(Source: P.A. 90-491, eff. 1-1-98.)
Section 90-15. The Telecommunications Municipal
Infrastructure Maintenance Fee Act is amended by changing
Sections 1, 5, 10, 15, 20, 25, 27, 27.35, 30, and 35 as
follows:
(35 ILCS 635/1)
Sec. 1. Short title. This Act may be cited as the
Telecommunications Municipal Infrastructure Maintenance Fee
Act.
(Source: P.A. 90-154, eff. 1-1-98.)
(35 ILCS 635/5)
Sec. 5. Legislative intent.
(a) The General Assembly imposed a tax on invested
capital of utilities to partially replace the personal
property tax that was abolished by the Illinois Constitution
of 1970. Since that tax was imposed, telecommunications
retailers have evolved from utility status into an
increasingly competitive industry serving the public.
(b) This Act is intended to abolish the invested capital
tax on telecommunications retailers (that is, persons engaged
in the business of transmitting messages and acting as a
retailer of telecommunications as defined in Section 2 of the
Telecommunications Excise Tax Act). Cellular
telecommunications retailers have already been excluded from
application of the invested capital tax by earlier
legislative action.
(c) For the period prior to the effective date of this
amendatory Act of the 92nd General Assembly, this Act is also
intended to abolish municipal franchise fees with respect to
telecommunications retailers, create a uniform system for the
collection and distribution of fees associated with the
privilege of use of the public right of way for
telecommunications activity, and provide municipalities with
a comprehensive method of compensation for telecommunications
activity including the recovery of reasonable costs of
regulating the use of the public rights-of-way for
telecommunications activity.
(d) For the period from the effective date of this
amendatory Act of the 92nd General Assembly through December
31, 2002, it is the intent of the General Assembly that the
municipal infrastructure maintenance fee and its rate are
subject only to the limits prescribed in Section 20, and that
the fee and the rate of the fee do not relate to use of the
public rights-of-way or the costs associated with maintaining
and regulating the use of the public rights-of-way. It is
also the intent of the General Assembly that proceeds of the
municipal infrastructure maintenance fee may be used for any
lawful corporate purpose. It is not the intent of the
General Assembly that the municipal infrastructure
maintenance fee is in any way compensation for use of the
public rights-of-way. It is the intent of the General
Assembly that the fee be paid by all telecommunications
retailers, regardless of whether they have equipment in the
public rights-of-way.
(e) This amendatory Act of the 92nd General Assembly is
intended to repeal the municipal infrastructure maintenance
fee and the optional infrastructure maintenance fee effective
January 1, 2003.
(Source: P.A. 90-154, eff. 1-1-98; 91-533, eff. 8-13-99.)
(35 ILCS 635/10)
(Text of Section before amendment by P.A. 92-474)
Sec. 10. Definitions.
(a) "Gross charges" means the amount paid to a
telecommunications retailer for the act or privilege of
originating or receiving telecommunications in this State or
the municipality imposing the fee under this Act, as the
context requires, and for all services rendered in connection
therewith, valued in money whether paid in money or
otherwise, including cash, credits, services, and property of
every kind or nature, and shall be determined without any
deduction on account of the cost of such telecommunications,
the cost of the materials used, labor or service costs, or
any other expense whatsoever. In case credit is extended,
the amount thereof shall be included only as and when paid.
"Gross charges" for private line service shall include
charges imposed at each channel point within this State or
the municipality imposing the fee under this Act, charges for
the channel mileage between each channel point within this
State or the municipality imposing the fee under this Act,
and charges for that portion of the interstate inter-office
channel provided within Illinois or the municipality imposing
the fee under this Act. However, "gross charges" shall not
include:
(1) any amounts added to a purchaser's bill because
of a charge made under: (i) the fee imposed by this
Section, (ii) additional charges added to a purchaser's
bill under Section 9-221 or 9-222 of the Public Utilities
Act, (iii) amounts collected under Section 8-11-17 of the
Illinois Municipal Code, (iv) the tax imposed by the
Telecommunications Excise Tax Act, (iv) (v) 911
surcharges, (v) or (vi) the tax imposed by Section 4251
of the Internal Revenue Code, or (vi) the tax imposed by
the Simplified Municipal Telecommunications Tax Act;
(2) charges for a sent collect telecommunication
received outside of this State or the municipality
imposing the fee, as the context requires;
(3) charges for leased time on equipment or charges
for the storage of data or information or subsequent
retrieval or the processing of data or information
intended to change its form or content. Such equipment
includes, but is not limited to, the use of calculators,
computers, data processing equipment, tabulating
equipment, or accounting equipment and also includes the
usage of computers under a time-sharing agreement.
(4) charges for customer equipment, including such
equipment that is leased or rented by the customer from
any source, wherein such charges are disaggregated and
separately identified from other charges;
(5) charges to business enterprises certified under
Section 9-222.1 of the Public Utilities Act to the extent
of such exemption and during the period of time specified
by the Department of Commerce and Community Affairs or by
the municipality imposing the fee under the Act, as the
context requires;
(6) charges for telecommunications and all services
and equipment provided in connection therewith between a
parent corporation and its wholly owned subsidiaries or
between wholly owned subsidiaries, and only to the extent
that the charges between the parent corporation and
wholly owned subsidiaries or between wholly owned
subsidiaries represent expense allocation between the
corporations and not the generation of profit other than
a regulatory required profit for the corporation
rendering such services;
(7) bad debts ("bad debt" means any portion of a
debt that is related to a sale at retail for which gross
charges are not otherwise deductible or excludable that
has become worthless or uncollectible, as determined
under applicable federal income tax standards; if the
portion of the debt deemed to be bad is subsequently
paid, the retailer shall report and pay the tax on that
portion during the reporting period in which the payment
is made); or
(8) charges paid by inserting coins in
coin-operated telecommunication devices.; or
(9) charges for telecommunications and all services
and equipment provided to a municipality imposing the
infrastructure maintenance fee.
(a-5) "Department" means the Illinois Department of
Revenue.
(b) "Telecommunications" includes, but is not limited
to, messages or information transmitted through use of local,
toll, and wide area telephone service, channel services,
telegraph services, teletypewriter service, computer exchange
services, private line services, specialized mobile radio
services, or any other transmission of messages or
information by electronic or similar means, between or among
points by wire, cable, fiber optics, laser, microwave, radio,
satellite, or similar facilities. Unless the context clearly
requires otherwise, "telecommunications" shall also include
wireless telecommunications as hereinafter defined.
"Telecommunications" shall not include value added services
in which computer processing applications are used to act on
the form, content, code, and protocol of the information for
purposes other than transmission. "Telecommunications" shall
not include purchase of telecommunications by a
telecommunications service provider for use as a component
part of the service provided by him or her to the ultimate
retail consumer who originates or terminates the end-to-end
communications. Retailer access charges, right of access
charges, charges for use of intercompany facilities, and all
telecommunications resold in the subsequent provision and
used as a component of, or integrated into, end-to-end
telecommunications service shall not be included in gross
charges as sales for resale. "Telecommunications" shall not
include the provision of cable services through a cable
system as defined in the Cable Communications Act of 1984 (47
U.S.C. Sections 521 and following) as now or hereafter
amended or through an open video system as defined in the
Rules of the Federal Communications Commission (47 C.D.F.
76.1550 and following) as now or hereafter amended. Beginning
January 1, 2001, prepaid telephone calling arrangements shall
not be considered "telecommunications" subject to the tax
imposed under this Act. For purposes of this Section,
"prepaid telephone calling arrangements" means that term as
defined in Section 2-27 of the Retailers' Occupation Tax Act.
(c) "Wireless telecommunications" includes cellular
mobile telephone services, personal wireless services as
defined in Section 704(C) of the Telecommunications Act of
1996 (Public Law No. 104-104) as now or hereafter amended,
including all commercial mobile radio services, and paging
services.
(d) "Telecommunications retailer" or "retailer" or
"carrier" means and includes every person engaged in the
business of making sales of telecommunications at retail as
defined in this Section. The Illinois Department of Revenue
or the municipality imposing the fee, as the case may be,
may, in its discretion, upon applications, authorize the
collection of the fee hereby imposed by any retailer not
maintaining a place of business within this State, who, to
the satisfaction of the Department or municipality, furnishes
adequate security to insure collection and payment of the
fee. When so authorized, it shall be the duty of such
retailer to pay the fee upon all of the gross charges for
telecommunications in the same manner and subject to the same
requirements as a retailer maintaining a place of business
within this the State or municipality imposing the fee.
(e) "Retailer maintaining a place of business in this
State", or any like term, means and includes any retailer
having or maintaining within this State, directly or by a
subsidiary, an office, distribution facilities, transmission
facilities, sales office, warehouse, or other place of
business, or any agent or other representative operating
within this State under the authority of the retailer or its
subsidiary, irrespective of whether such place of business or
agent or other representative is located here permanently or
temporarily, or whether such retailer or subsidiary is
licensed to do business in this State.
(f) "Sale of telecommunications at retail" means the
transmitting, supplying, or furnishing of telecommunications
and all services rendered in connection therewith for a
consideration, other than between a parent corporation and
its wholly owned subsidiaries or between wholly owned
subsidiaries, when the gross charge made by one such
corporation to another such corporation is not greater than
the gross charge paid to the retailer for their use or
consumption and not for sale.
(g) "Service address" means the location of
telecommunications equipment from which telecommunications
services are originated or at which telecommunications
services are received. If this is not a defined location, as
in the case of wireless telecommunications, paging systems,
maritime systems, air-to-ground systems, and the like,
"service address" shall mean the location of the customer's
primary use of the telecommunications equipment as defined by
the location in Illinois where bills are sent.
(Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97;
91-870, eff. 6-22-00.)
(Text of Section after amendment by P.A. 92-474)
Sec. 10. Definitions.
(a) "Gross charges" means the amount paid to a
telecommunications retailer for the act or privilege of
originating or receiving telecommunications in this State or
the municipality imposing the fee under this Act, as the
context requires, and for all services rendered in connection
therewith, valued in money whether paid in money or
otherwise, including cash, credits, services, and property of
every kind or nature, and shall be determined without any
deduction on account of the cost of such telecommunications,
the cost of the materials used, labor or service costs, or
any other expense whatsoever. In case credit is extended,
the amount thereof shall be included only as and when paid.
"Gross charges" for private line service shall include
charges imposed at each channel point within this State or
the municipality imposing the fee under this Act, charges for
the channel mileage between each channel point within this
State or the municipality imposing the fee under this Act,
and charges for that portion of the interstate inter-office
channel provided within Illinois or the municipality imposing
the fee under this Act. However, "gross charges" shall not
include:
(1) any amounts added to a purchaser's bill because
of a charge made under: (i) the fee imposed by this
Section, (ii) additional charges added to a purchaser's
bill under Section 9-221 or 9-222 of the Public Utilities
Act, (iii) amounts collected under Section 8-11-17 of the
Illinois Municipal Code, (iv) the tax imposed by the
Telecommunications Excise Tax Act, (iv) (v) 911
surcharges, (v) or (vi) the tax imposed by Section 4251
of the Internal Revenue Code, or (vi) the tax imposed by
the Simplified Municipal Telecommunications Tax Act;
(2) charges for a sent collect telecommunication
received outside of this State or the municipality
imposing the fee, as the context requires;
(3) charges for leased time on equipment or charges
for the storage of data or information or subsequent
retrieval or the processing of data or information
intended to change its form or content. Such equipment
includes, but is not limited to, the use of calculators,
computers, data processing equipment, tabulating
equipment, or accounting equipment and also includes the
usage of computers under a time-sharing agreement;
(4) charges for customer equipment, including such
equipment that is leased or rented by the customer from
any source, wherein such charges are disaggregated and
separately identified from other charges;
(5) charges to business enterprises certified under
Section 9-222.1 of the Public Utilities Act to the extent
of such exemption and during the period of time specified
by the Department of Commerce and Community Affairs or by
the municipality imposing the fee under the Act, as the
context requires;
(6) charges for telecommunications and all services
and equipment provided in connection therewith between a
parent corporation and its wholly owned subsidiaries or
between wholly owned subsidiaries, and only to the extent
that the charges between the parent corporation and
wholly owned subsidiaries or between wholly owned
subsidiaries represent expense allocation between the
corporations and not the generation of profit other than
a regulatory required profit for the corporation
rendering such services;
(7) bad debts ("bad debt" means any portion of a
debt that is related to a sale at retail for which gross
charges are not otherwise deductible or excludable that
has become worthless or uncollectible, as determined
under applicable federal income tax standards; if the
portion of the debt deemed to be bad is subsequently
paid, the retailer shall report and pay the tax on that
portion during the reporting period in which the payment
is made); or
(8) charges paid by inserting coins in
coin-operated telecommunication devices.; or
(9) charges for telecommunications and all services
and equipment provided to a municipality imposing the
infrastructure maintenance fee.
(a-5) "Department" means the Illinois Department of
Revenue.
(b) "Telecommunications" includes, but is not limited
to, messages or information transmitted through use of local,
toll, and wide area telephone service, channel services,
telegraph services, teletypewriter service, computer exchange
services, private line services, specialized mobile radio
services, or any other transmission of messages or
information by electronic or similar means, between or among
points by wire, cable, fiber optics, laser, microwave, radio,
satellite, or similar facilities. Unless the context clearly
requires otherwise, "telecommunications" shall also include
wireless telecommunications as hereinafter defined.
"Telecommunications" shall not include value added services
in which computer processing applications are used to act on
the form, content, code, and protocol of the information for
purposes other than transmission. "Telecommunications" shall
not include purchase of telecommunications by a
telecommunications service provider for use as a component
part of the service provided by him or her to the ultimate
retail consumer who originates or terminates the end-to-end
communications. Retailer access charges, right of access
charges, charges for use of intercompany facilities, and all
telecommunications resold in the subsequent provision and
used as a component of, or integrated into, end-to-end
telecommunications service shall not be included in gross
charges as sales for resale. "Telecommunications" shall not
include the provision of cable services through a cable
system as defined in the Cable Communications Act of 1984 (47
U.S.C. Sections 521 and following) as now or hereafter
amended or through an open video system as defined in the
Rules of the Federal Communications Commission (47 C.D.F.
76.1550 and following) as now or hereafter amended. Beginning
January 1, 2001, prepaid telephone calling arrangements shall
not be considered "telecommunications" subject to the tax
imposed under this Act. For purposes of this Section,
"prepaid telephone calling arrangements" means that term as
defined in Section 2-27 of the Retailers' Occupation Tax Act.
(c) "Wireless telecommunications" includes cellular
mobile telephone services, personal wireless services as
defined in Section 704(C) of the Telecommunications Act of
1996 (Public Law No. 104-104) as now or hereafter amended,
including all commercial mobile radio services, and paging
services.
(d) "Telecommunications retailer" or "retailer" or
"carrier" means and includes every person engaged in the
business of making sales of telecommunications at retail as
defined in this Section. The Illinois Department of Revenue
or the municipality imposing the fee, as the case may be,
may, in its discretion, upon applications, authorize the
collection of the fee hereby imposed by any retailer not
maintaining a place of business within this State, who, to
the satisfaction of the Department or municipality, furnishes
adequate security to insure collection and payment of the
fee. When so authorized, it shall be the duty of such
retailer to pay the fee upon all of the gross charges for
telecommunications in the same manner and subject to the same
requirements as a retailer maintaining a place of business
within this the State or municipality imposing the fee.
(e) "Retailer maintaining a place of business in this
State", or any like term, means and includes any retailer
having or maintaining within this State, directly or by a
subsidiary, an office, distribution facilities, transmission
facilities, sales office, warehouse, or other place of
business, or any agent or other representative operating
within this State under the authority of the retailer or its
subsidiary, irrespective of whether such place of business or
agent or other representative is located here permanently or
temporarily, or whether such retailer or subsidiary is
licensed to do business in this State.
(f) "Sale of telecommunications at retail" means the
transmitting, supplying, or furnishing of telecommunications
and all services rendered in connection therewith for a
consideration, other than between a parent corporation and
its wholly owned subsidiaries or between wholly owned
subsidiaries, when the gross charge made by one such
corporation to another such corporation is not greater than
the gross charge paid to the retailer for their use or
consumption and not for sale.
(g) "Service address" means the location of
telecommunications equipment from which telecommunications
services are originated or at which telecommunications
services are received. If this is not a defined location, as
in the case of wireless telecommunications, paging systems,
maritime systems, service address means the customer's place
of primary use as defined in the Mobile Telecommunications
Sourcing Conformity Act. For air-to-ground systems, and the
like, "service address" shall mean the location of the
customer's primary use of the telecommunications equipment as
defined by the location in Illinois where bills are sent.
(Source: P.A. 91-870, eff. 6-22-00; 92-474, eff. 8-1-02.)
(35 ILCS 635/15)
Sec. 15. State telecommunications infrastructure
maintenance fees.
(a) A State infrastructure maintenance fee is hereby
imposed upon telecommunications retailers as a replacement
for the personal property tax in an amount specified in
subsection (b).
(b) The amount of the State infrastructure maintenance
fee imposed upon a telecommunications retailer under this
Section shall be equal to 0.5% of all gross charges charged
by the telecommunications retailer to service addresses in
this State for telecommunications, other than wireless
telecommunications, originating or received in this State.
However, the State infrastructure maintenance fee is not
imposed in any case in which the imposition of the fee would
violate the Constitution or statutes of the United States.
(c) (Blank). An optional infrastructure maintenance fee
is hereby created. A telecommunications retailer may elect
to pay the optional infrastructure maintenance fee with
respect to the gross charges charged by the
telecommunications retailer to service addresses in a
particular municipality for telecommunications, other than
wireless telecommunications, originating or received in the
municipality if (1) the telecommunications retailer is not
required to pay any compensation to the municipality under an
existing franchise agreement and (2) the municipality has not
imposed a municipal infrastructure maintenance fee as
authorized in Section 20 of this Act. A telecommunications
retailer electing to pay the optional infrastructure
maintenance fee shall notify the Department of such election
on the application for certificate of registration. If a
telecommunications retailer elects to pay this fee with
respect to the gross charges charged by the
telecommunications retailer to service addresses in a
particular municipality, such election shall remain in full
force and effect until such time as the municipality imposes
a municipal infrastructure maintenance fee.
(d) (Blank). The amount of the optional infrastructure
maintenance fee which a telecommunications retailer may elect
to pay with respect to a particular municipality shall be
equal to 25% of the maximum amount of the municipal
infrastructure maintenance fee which the municipality could
impose under Section 20 of this Act.
(e) The State infrastructure maintenance fee and the
optional infrastructure maintenance fee authorized by this
Section shall be collected, enforced, and administered as set
forth in subsection (b) of Section 25 of this Act.
(Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97.)
(35 ILCS 635/20)
Sec. 20. Municipal telecommunications infrastructure
maintenance fee.
(a) A municipality may impose a municipal infrastructure
maintenance fee upon telecommunications retailers in an
amount specified in subsection (b). On and after the
effective date of this amendatory Act of 1997, a certified
copy of an ordinance or resolution imposing a fee under this
Section shall be filed with the Department within 30 days
after the effective date of this amendatory Act or the
effective date of the ordinance or resolution imposing such
fee, whichever is later. Failure to file a certified copy of
the ordinance or resolution imposing a fee under this Section
shall have no effect on the validity of the ordinance or
resolution. The Department shall create and maintain a list
of all ordinances and resolutions filed pursuant to this
Section and make that list, as well as copies of the
ordinances and resolutions, available to the public for a
reasonable fee.
(b) The amount of the municipal infrastructure
maintenance fee imposed upon a telecommunications retailer
under this Section shall not exceed: (i) in a municipality
with a population of more than 500,000, 2.0% of all gross
charges charged by the telecommunications retailer to service
addresses in the municipality for telecommunications
originating or received in the municipality; and (ii) in a
municipality with a population of 500,000 or less, 1.0% of
all gross charges charged by the telecommunications retailer
to service addresses in the municipality for
telecommunications originating or received in the
municipality which fee, for the period commencing on the
effective date of this amendatory Act of the 92nd General
Assembly through December 31, 2002, may be imposed at the
rates set forth herein without regard to the provisions of
Sections 8-11-2 and 8-11-17 of the Illinois Municipal Code.
If imposed, the municipal telecommunications infrastructure
fee must be in 1/4% increments. However, the fee shall not be
imposed in any case in which the imposition of the fee would
violate the Constitution or statutes of the United States.
(c) The municipal telecommunications infrastructure fee
authorized by this Section shall be collected, enforced, and
administered as set forth in subsection (c) of Section 25 of
this Act.
(d) A municipality with a population of more than
500,000 that imposes a municipal infrastructure maintenance
fee under this Section may, by ordinance, exempt from the fee
all charges for the inbound toll-free telecommunications
service commonly known as "800", "877", or "888" or for a
similar service.
(e) For the period from the effective date of this
amendatory Act of the 92nd General Assembly through December
31, 2002, any ordinance previously enacted for the purpose of
imposing a municipal infrastructure maintenance fee shall be
valid and effective for the purpose of imposing the municipal
infrastructure maintenance fee described in subsection (d) of
Section 5 of this Act.
(f) This Section is repealed on January 1, 2003.
(Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97;
91-870, eff. 6-22-00.)
(35 ILCS 635/25)
Sec. 25. Collection, enforcement, and administration of
State telecommunications infrastructure maintenance fees.
(a) A telecommunications retailer shall charge each
customer an additional charge equal to the sum of (1) an
amount equal to the State infrastructure maintenance fee
attributable to that customer's service address and (2) an
amount equal to the optional infrastructure maintenance fee,
if any, attributable to that customer's service address and
(3) an amount equal to the municipal infrastructure
maintenance fee, if any, attributable to that customer's
service address. Such additional charge shall be shown
separately on the bill to each customer.
(b) The State infrastructure maintenance fee and the
optional infrastructure maintenance fee shall be designated
as a replacement for the personal property tax and shall be
remitted by the telecommunications retailer to the Illinois
Department of Revenue; provided, however, that the
telecommunications retailer may retain an amount not to
exceed 2% of the State infrastructure maintenance fee and the
optional infrastructure maintenance fee, if any, paid to the
Department, with a timely paid and timely filed return to
reimburse itself for expenses incurred in collecting,
accounting for, and remitting the fee. All amounts herein
remitted to the Department shall be transferred to the
Personal Property Tax Replacement Fund in the State Treasury.
(c) The municipal infrastructure maintenance fee shall
be remitted by the telecommunications retailer to the
municipality imposing the municipal infrastructure
maintenance fee; provided, however, that the
telecommunications retailer may retain an amount not to
exceed 2% of the municipal infrastructure maintenance fee
collected by it to reimburse itself for expenses incurred in
accounting for and remitting the fee. The municipality
imposing the municipal infrastructure maintenance fee shall
collect, enforce, and administer the fee.
(d) Except as provided in subsection (e), During any
period of time when a municipality receives any compensation
other than the municipal infrastructure maintenance fee set
forth in Section 20, for a telecommunications retailer's use
of the public right-of-way, no municipal infrastructure
maintenance fee may be imposed by such municipality pursuant
to this Act.
(e) A municipality that, pursuant to a franchise
agreement in existence on the effective date of this Act,
receives compensation from a telecommunications retailer for
the use of the public right of way, may impose a municipal
infrastructure maintenance fee pursuant to this Act only on
the condition that such municipality (1) waives its right to
receive all fees, charges and other compensation under all
existing franchise agreements or the like with
telecommunications retailers during the time that the
municipality imposes a municipal infrastructure maintenance
fee and (2) imposes by ordinance (or other proper means) a
municipal infrastructure maintenance fee which becomes
effective no sooner than 90 days after such municipality has
provided written notice by certified mail to each
telecommunications retailer with whom the municipality has an
existing franchise agreement, that the municipality waives
all compensation under such existing franchise agreement.
(Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97;
90-655, eff. 7-30-98.)
(35 ILCS 635/27)
Sec. 27. Returns by telecommunications retailer;
extensions. Except as provided hereinafter in this Section,
on or before the 30th day of each month each
telecommunications retailer maintaining a place of business
in this State shall make a return and payment of fees to the
Department for the preceding calendar month on a form
prescribed and furnished by the Department. The return shall
be signed by the telecommunications retailer under penalties
of perjury and shall contain the following information:
1. His or her name;
2. The address of his or her principal place of
business, or and the address of the principal place of
business (if that is a different address) from which he
or she engages in the business of transmitting
telecommunications;
3. The total amount of gross charges charged by him
or her during the preceding calendar month for providing
telecommunications during such calendar month;
4. The total amount received by him or her during
the preceding calendar month on credit extended;
5. Deductions allowed by law;
6. Gross charges that were charged by him or her
during the preceding calendar month and upon the basis of
which the State infrastructure maintenance fee is
imposed;
7. (Blank) Gross charges that were charged by him
or her during the preceding calendar month and upon the
basis of which the optional infrastructure maintenance
fee, if any, is imposed for each particular municipality;
8. Amounts of fees due;
9. Such other reasonable information as the
Department may require.
If the telecommunications retailer's average monthly
liability to the Department does not exceed $100, the
Department may authorize his or her returns to be filed on a
quarter annual basis, with the return for January, February,
and March of a given year being due by April 15 of such year;
with the return for April, May, and June of a given year
being due by July 15 of such year; with the return for July,
August, and September of a given year being due by October 15
of such year; and with the return of October, November, and
December of a given year being due by January 15 of the
following year.
Notwithstanding any other provision of this Act
concerning the time within which a telecommunications
retailer may file his or her return, in the case of any
telecommunications retailer who ceases to engage in a kind of
business which makes him or her responsible for filing
returns under this Act, such telecommunications retailer
shall file a final return under this Act with the Department
not more than