100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB1239

 

Introduced , by Rep. Michael J. Madigan

 

SYNOPSIS AS INTRODUCED:
 
65 ILCS 5/8-11-5  from Ch. 24, par. 8-11-5

    Amends the Home Rule Municipal Service Occupation Tax Act in the Illinois Municipal Code. Makes a technical change in a Section authorizing the imposition of the tax.


LRB100 02947 AWJ 12952 b

 

 

A BILL FOR

 

HB1239LRB100 02947 AWJ 12952 b

1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Municipal Code is amended by
5changing Section 8-11-5 as follows:
 
6    (65 ILCS 5/8-11-5)  (from Ch. 24, par. 8-11-5)
7    Sec. 8-11-5. Home Rule Municipal Service Occupation Tax
8Act. The The corporate authorities of a home rule municipality
9may impose a tax upon all persons engaged, in such
10municipality, in the business of making sales of service at the
11same rate of tax imposed pursuant to Section 8-11-1, of the
12selling price of all tangible personal property transferred by
13such servicemen either in the form of tangible personal
14property or in the form of real estate as an incident to a sale
15of service. If imposed, such tax shall only be imposed in 1/4%
16increments. On and after September 1, 1991, this additional tax
17may not be imposed on the sales of food for human consumption
18which is to be consumed off the premises where it is sold
19(other than alcoholic beverages, soft drinks and food which has
20been prepared for immediate consumption) and prescription and
21nonprescription medicines, drugs, medical appliances and
22insulin, urine testing materials, syringes and needles used by
23diabetics. The tax imposed by a home rule municipality pursuant

 

 

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1to this Section and all civil penalties that may be assessed as
2an incident thereof shall be collected and enforced by the
3State Department of Revenue. The certificate of registration
4which is issued by the Department to a retailer under the
5Retailers' Occupation Tax Act or under the Service Occupation
6Tax Act shall permit such registrant to engage in a business
7which is taxable under any ordinance or resolution enacted
8pursuant to this Section without registering separately with
9the Department under such ordinance or resolution or under this
10Section. The Department shall have full power to administer and
11enforce this Section; to collect all taxes and penalties due
12hereunder; to dispose of taxes and penalties so collected in
13the manner hereinafter provided, and to determine all rights to
14credit memoranda arising on account of the erroneous payment of
15tax or penalty hereunder. In the administration of, and
16compliance with, this Section the Department and persons who
17are subject to this Section shall have the same rights,
18remedies, privileges, immunities, powers and duties, and be
19subject to the same conditions, restrictions, limitations,
20penalties and definitions of terms, and employ the same modes
21of procedure, as are prescribed in Sections 1a-1, 2, 2a, 3
22through 3-50 (in respect to all provisions therein other than
23the State rate of tax), 4 (except that the reference to the
24State shall be to the taxing municipality), 5, 7, 8 (except
25that the jurisdiction to which the tax shall be a debt to the
26extent indicated in that Section 8 shall be the taxing

 

 

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1municipality), 9 (except as to the disposition of taxes and
2penalties collected, and except that the returned merchandise
3credit for this municipal tax may not be taken against any
4State tax), 10, 11, 12 (except the reference therein to Section
52b of the Retailers' Occupation Tax Act), 13 (except that any
6reference to the State shall mean the taxing municipality), the
7first paragraph of Section 15, 16, 17 (except that credit
8memoranda issued hereunder may not be used to discharge any
9State tax liability), 18, 19 and 20 of the Service Occupation
10Tax Act and Section 3-7 of the Uniform Penalty and Interest
11Act, as fully as if those provisions were set forth herein.
12    No tax may be imposed by a home rule municipality pursuant
13to this Section unless such municipality also imposes a tax at
14the same rate pursuant to Section 8-11-1 of this Act.
15    Persons subject to any tax imposed pursuant to the
16authority granted in this Section may reimburse themselves for
17their serviceman's tax liability hereunder by separately
18stating such tax as an additional charge, which charge may be
19stated in combination, in a single amount, with State tax which
20servicemen are authorized to collect under the Service Use Tax
21Act, pursuant to such bracket schedules as the Department may
22prescribe.
23    Whenever the Department determines that a refund should be
24made under this Section to a claimant instead of issuing credit
25memorandum, the Department shall notify the State Comptroller,
26who shall cause the order to be drawn for the amount specified,

 

 

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1and to the person named, in such notification from the
2Department. Such refund shall be paid by the State Treasurer
3out of the home rule municipal retailers' occupation tax fund.
4    The Department shall forthwith pay over to the State
5Treasurer, ex-officio, as trustee, all taxes and penalties
6collected hereunder.
7    As soon as possible after the first day of each month,
8beginning January 1, 2011, upon certification of the Department
9of Revenue, the Comptroller shall order transferred, and the
10Treasurer shall transfer, to the STAR Bonds Revenue Fund the
11local sales tax increment, as defined in the Innovation
12Development and Economy Act, collected under this Section
13during the second preceding calendar month for sales within a
14STAR bond district.
15    After the monthly transfer to the STAR Bonds Revenue Fund,
16on or before the 25th day of each calendar month, the
17Department shall prepare and certify to the Comptroller the
18disbursement of stated sums of money to named municipalities,
19the municipalities to be those from which suppliers and
20servicemen have paid taxes or penalties hereunder to the
21Department during the second preceding calendar month. The
22amount to be paid to each municipality shall be the amount (not
23including credit memoranda) collected hereunder during the
24second preceding calendar month by the Department, and not
25including an amount equal to the amount of refunds made during
26the second preceding calendar month by the Department on behalf

 

 

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1of such municipality, and not including any amounts that are
2transferred to the STAR Bonds Revenue Fund. Within 10 days
3after receipt, by the Comptroller, of the disbursement
4certification to the municipalities, provided for in this
5Section to be given to the Comptroller by the Department, the
6Comptroller shall cause the orders to be drawn for the
7respective amounts in accordance with the directions contained
8in such certification.
9    In addition to the disbursement required by the preceding
10paragraph and in order to mitigate delays caused by
11distribution procedures, an allocation shall, if requested, be
12made within 10 days after January 14, 1991, and in November of
131991 and each year thereafter, to each municipality that
14received more than $500,000 during the preceding fiscal year,
15(July 1 through June 30) whether collected by the municipality
16or disbursed by the Department as required by this Section.
17Within 10 days after January 14, 1991, participating
18municipalities shall notify the Department in writing of their
19intent to participate. In addition, for the initial
20distribution, participating municipalities shall certify to
21the Department the amounts collected by the municipality for
22each month under its home rule occupation and service
23occupation tax during the period July 1, 1989 through June 30,
241990. The allocation within 10 days after January 14, 1991,
25shall be in an amount equal to the monthly average of these
26amounts, excluding the 2 months of highest receipts. Monthly

 

 

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1average for the period of July 1, 1990 through June 30, 1991
2will be determined as follows: the amounts collected by the
3municipality under its home rule occupation and service
4occupation tax during the period of July 1, 1990 through
5September 30, 1990, plus amounts collected by the Department
6and paid to such municipality through June 30, 1991, excluding
7the 2 months of highest receipts. The monthly average for each
8subsequent period of July 1 through June 30 shall be an amount
9equal to the monthly distribution made to each such
10municipality under the preceding paragraph during this period,
11excluding the 2 months of highest receipts. The distribution
12made in November 1991 and each year thereafter under this
13paragraph and the preceding paragraph shall be reduced by the
14amount allocated and disbursed under this paragraph in the
15preceding period of July 1 through June 30. The Department
16shall prepare and certify to the Comptroller for disbursement
17the allocations made in accordance with this paragraph.
18    Nothing in this Section shall be construed to authorize a
19municipality to impose a tax upon the privilege of engaging in
20any business which under the constitution of the United States
21may not be made the subject of taxation by this State.
22    An ordinance or resolution imposing or discontinuing a tax
23hereunder or effecting a change in the rate thereof shall be
24adopted and a certified copy thereof filed with the Department
25on or before the first day of June, whereupon the Department
26shall proceed to administer and enforce this Section as of the

 

 

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1first day of September next following such adoption and filing.
2Beginning January 1, 1992, an ordinance or resolution imposing
3or discontinuing the tax hereunder or effecting a change in the
4rate thereof shall be adopted and a certified copy thereof
5filed with the Department on or before the first day of July,
6whereupon the Department shall proceed to administer and
7enforce this Section as of the first day of October next
8following such adoption and filing. Beginning January 1, 1993,
9an ordinance or resolution imposing or discontinuing the tax
10hereunder or effecting a change in the rate thereof shall be
11adopted and a certified copy thereof filed with the Department
12on or before the first day of October, whereupon the Department
13shall proceed to administer and enforce this Section as of the
14first day of January next following such adoption and filing.
15However, a municipality located in a county with a population
16in excess of 3,000,000 that elected to become a home rule unit
17at the general primary election in 1994 may adopt an ordinance
18or resolution imposing the tax under this Section and file a
19certified copy of the ordinance or resolution with the
20Department on or before July 1, 1994. The Department shall then
21proceed to administer and enforce this Section as of October 1,
221994. Beginning April 1, 1998, an ordinance or resolution
23imposing or discontinuing the tax hereunder or effecting a
24change in the rate thereof shall either (i) be adopted and a
25certified copy thereof filed with the Department on or before
26the first day of April, whereupon the Department shall proceed

 

 

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1to administer and enforce this Section as of the first day of
2July next following the adoption and filing; or (ii) be adopted
3and a certified copy thereof filed with the Department on or
4before the first day of October, whereupon the Department shall
5proceed to administer and enforce this Section as of the first
6day of January next following the adoption and filing.
7    Any unobligated balance remaining in the Municipal
8Retailers' Occupation Tax Fund on December 31, 1989, which fund
9was abolished by Public Act 85-1135, and all receipts of
10municipal tax as a result of audits of liability periods prior
11to January 1, 1990, shall be paid into the Local Government Tax
12Fund, for distribution as provided by this Section prior to the
13enactment of Public Act 85-1135. All receipts of municipal tax
14as a result of an assessment not arising from an audit, for
15liability periods prior to January 1, 1990, shall be paid into
16the Local Government Tax Fund for distribution before July 1,
171990, as provided by this Section prior to the enactment of
18Public Act 85-1135, and on and after July 1, 1990, all such
19receipts shall be distributed as provided in Section 6z-18 of
20the State Finance Act.
21    As used in this Section, "municipal" and "municipality"
22means a city, village or incorporated town, including an
23incorporated town which has superseded a civil township.
24    This Section shall be known and may be cited as the Home
25Rule Municipal Service Occupation Tax Act.
26(Source: P.A. 96-939, eff. 6-24-10.)