101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB1678

 

Introduced 2/15/2019, by Sen. Jil Tracy

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-5
35 ILCS 110/3-5
35 ILCS 115/3-5
35 ILCS 120/2-5

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that products purchased by an eligible apiarist for use in producing honey bee products for sale or for providing bee pollination services are exempt from the tax imposed under the Act.


LRB101 09656 HLH 54755 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB1678LRB101 09656 HLH 54755 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Section
53-5 as follows:
 
6    (35 ILCS 105/3-5)
7    Sec. 3-5. Exemptions. Use of the following tangible
8personal property is exempt from the tax imposed by this Act:
9    (1) Personal property purchased from a corporation,
10society, association, foundation, institution, or
11organization, other than a limited liability company, that is
12organized and operated as a not-for-profit service enterprise
13for the benefit of persons 65 years of age or older if the
14personal property was not purchased by the enterprise for the
15purpose of resale by the enterprise.
16    (2) Personal property purchased by a not-for-profit
17Illinois county fair association for use in conducting,
18operating, or promoting the county fair.
19    (3) Personal property purchased by a not-for-profit arts or
20cultural organization that establishes, by proof required by
21the Department by rule, that it has received an exemption under
22Section 501(c)(3) of the Internal Revenue Code and that is
23organized and operated primarily for the presentation or

 

 

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1support of arts or cultural programming, activities, or
2services. These organizations include, but are not limited to,
3music and dramatic arts organizations such as symphony
4orchestras and theatrical groups, arts and cultural service
5organizations, local arts councils, visual arts organizations,
6and media arts organizations. On and after July 1, 2001 (the
7effective date of Public Act 92-35), however, an entity
8otherwise eligible for this exemption shall not make tax-free
9purchases unless it has an active identification number issued
10by the Department.
11    (4) Personal property purchased by a governmental body, by
12a corporation, society, association, foundation, or
13institution organized and operated exclusively for charitable,
14religious, or educational purposes, or by a not-for-profit
15corporation, society, association, foundation, institution, or
16organization that has no compensated officers or employees and
17that is organized and operated primarily for the recreation of
18persons 55 years of age or older. A limited liability company
19may qualify for the exemption under this paragraph only if the
20limited liability company is organized and operated
21exclusively for educational purposes. On and after July 1,
221987, however, no entity otherwise eligible for this exemption
23shall make tax-free purchases unless it has an active exemption
24identification number issued by the Department.
25    (5) Until July 1, 2003, a passenger car that is a
26replacement vehicle to the extent that the purchase price of

 

 

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1the car is subject to the Replacement Vehicle Tax.
2    (6) Until July 1, 2003 and beginning again on September 1,
32004 through August 30, 2014, graphic arts machinery and
4equipment, including repair and replacement parts, both new and
5used, and including that manufactured on special order,
6certified by the purchaser to be used primarily for graphic
7arts production, and including machinery and equipment
8purchased for lease. Equipment includes chemicals or chemicals
9acting as catalysts but only if the chemicals or chemicals
10acting as catalysts effect a direct and immediate change upon a
11graphic arts product. Beginning on July 1, 2017, graphic arts
12machinery and equipment is included in the manufacturing and
13assembling machinery and equipment exemption under paragraph
14(18).
15    (7) Farm chemicals.
16    (8) Legal tender, currency, medallions, or gold or silver
17coinage issued by the State of Illinois, the government of the
18United States of America, or the government of any foreign
19country, and bullion.
20    (9) Personal property purchased from a teacher-sponsored
21student organization affiliated with an elementary or
22secondary school located in Illinois.
23    (10) A motor vehicle that is used for automobile renting,
24as defined in the Automobile Renting Occupation and Use Tax
25Act.
26    (11) Farm machinery and equipment, both new and used,

 

 

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1including that manufactured on special order, certified by the
2purchaser to be used primarily for production agriculture or
3State or federal agricultural programs, including individual
4replacement parts for the machinery and equipment, including
5machinery and equipment purchased for lease, and including
6implements of husbandry defined in Section 1-130 of the
7Illinois Vehicle Code, farm machinery and agricultural
8chemical and fertilizer spreaders, and nurse wagons required to
9be registered under Section 3-809 of the Illinois Vehicle Code,
10but excluding other motor vehicles required to be registered
11under the Illinois Vehicle Code. Horticultural polyhouses or
12hoop houses used for propagating, growing, or overwintering
13plants shall be considered farm machinery and equipment under
14this item (11). Agricultural chemical tender tanks and dry
15boxes shall include units sold separately from a motor vehicle
16required to be licensed and units sold mounted on a motor
17vehicle required to be licensed if the selling price of the
18tender is separately stated.
19    Farm machinery and equipment shall include precision
20farming equipment that is installed or purchased to be
21installed on farm machinery and equipment including, but not
22limited to, tractors, harvesters, sprayers, planters, seeders,
23or spreaders. Precision farming equipment includes, but is not
24limited to, soil testing sensors, computers, monitors,
25software, global positioning and mapping systems, and other
26such equipment.

 

 

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1    Farm machinery and equipment also includes computers,
2sensors, software, and related equipment used primarily in the
3computer-assisted operation of production agriculture
4facilities, equipment, and activities such as, but not limited
5to, the collection, monitoring, and correlation of animal and
6crop data for the purpose of formulating animal diets and
7agricultural chemicals. This item (11) is exempt from the
8provisions of Section 3-90.
9    (12) Until June 30, 2013, fuel and petroleum products sold
10to or used by an air common carrier, certified by the carrier
11to be used for consumption, shipment, or storage in the conduct
12of its business as an air common carrier, for a flight destined
13for or returning from a location or locations outside the
14United States without regard to previous or subsequent domestic
15stopovers.
16    Beginning July 1, 2013, fuel and petroleum products sold to
17or used by an air carrier, certified by the carrier to be used
18for consumption, shipment, or storage in the conduct of its
19business as an air common carrier, for a flight that (i) is
20engaged in foreign trade or is engaged in trade between the
21United States and any of its possessions and (ii) transports at
22least one individual or package for hire from the city of
23origination to the city of final destination on the same
24aircraft, without regard to a change in the flight number of
25that aircraft.
26    (13) Proceeds of mandatory service charges separately

 

 

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1stated on customers' bills for the purchase and consumption of
2food and beverages purchased at retail from a retailer, to the
3extent that the proceeds of the service charge are in fact
4turned over as tips or as a substitute for tips to the
5employees who participate directly in preparing, serving,
6hosting or cleaning up the food or beverage function with
7respect to which the service charge is imposed.
8    (14) Until July 1, 2003, oil field exploration, drilling,
9and production equipment, including (i) rigs and parts of rigs,
10rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
11tubular goods, including casing and drill strings, (iii) pumps
12and pump-jack units, (iv) storage tanks and flow lines, (v) any
13individual replacement part for oil field exploration,
14drilling, and production equipment, and (vi) machinery and
15equipment purchased for lease; but excluding motor vehicles
16required to be registered under the Illinois Vehicle Code.
17    (15) Photoprocessing machinery and equipment, including
18repair and replacement parts, both new and used, including that
19manufactured on special order, certified by the purchaser to be
20used primarily for photoprocessing, and including
21photoprocessing machinery and equipment purchased for lease.
22    (16) Until July 1, 2023, coal and aggregate exploration,
23mining, off-highway hauling, processing, maintenance, and
24reclamation equipment, including replacement parts and
25equipment, and including equipment purchased for lease, but
26excluding motor vehicles required to be registered under the

 

 

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1Illinois Vehicle Code. The changes made to this Section by
2Public Act 97-767 apply on and after July 1, 2003, but no claim
3for credit or refund is allowed on or after August 16, 2013
4(the effective date of Public Act 98-456) for such taxes paid
5during the period beginning July 1, 2003 and ending on August
616, 2013 (the effective date of Public Act 98-456).
7    (17) Until July 1, 2003, distillation machinery and
8equipment, sold as a unit or kit, assembled or installed by the
9retailer, certified by the user to be used only for the
10production of ethyl alcohol that will be used for consumption
11as motor fuel or as a component of motor fuel for the personal
12use of the user, and not subject to sale or resale.
13    (18) Manufacturing and assembling machinery and equipment
14used primarily in the process of manufacturing or assembling
15tangible personal property for wholesale or retail sale or
16lease, whether that sale or lease is made directly by the
17manufacturer or by some other person, whether the materials
18used in the process are owned by the manufacturer or some other
19person, or whether that sale or lease is made apart from or as
20an incident to the seller's engaging in the service occupation
21of producing machines, tools, dies, jigs, patterns, gauges, or
22other similar items of no commercial value on special order for
23a particular purchaser. The exemption provided by this
24paragraph (18) does not include machinery and equipment used in
25(i) the generation of electricity for wholesale or retail sale;
26(ii) the generation or treatment of natural or artificial gas

 

 

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1for wholesale or retail sale that is delivered to customers
2through pipes, pipelines, or mains; or (iii) the treatment of
3water for wholesale or retail sale that is delivered to
4customers through pipes, pipelines, or mains. The provisions of
5Public Act 98-583 are declaratory of existing law as to the
6meaning and scope of this exemption. Beginning on July 1, 2017,
7the exemption provided by this paragraph (18) includes, but is
8not limited to, graphic arts machinery and equipment, as
9defined in paragraph (6) of this Section.
10    (19) Personal property delivered to a purchaser or
11purchaser's donee inside Illinois when the purchase order for
12that personal property was received by a florist located
13outside Illinois who has a florist located inside Illinois
14deliver the personal property.
15    (20) Semen used for artificial insemination of livestock
16for direct agricultural production.
17    (21) Horses, or interests in horses, registered with and
18meeting the requirements of any of the Arabian Horse Club
19Registry of America, Appaloosa Horse Club, American Quarter
20Horse Association, United States Trotting Association, or
21Jockey Club, as appropriate, used for purposes of breeding or
22racing for prizes. This item (21) is exempt from the provisions
23of Section 3-90, and the exemption provided for under this item
24(21) applies for all periods beginning May 30, 1995, but no
25claim for credit or refund is allowed on or after January 1,
262008 for such taxes paid during the period beginning May 30,

 

 

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12000 and ending on January 1, 2008.
2    (22) Computers and communications equipment utilized for
3any hospital purpose and equipment used in the diagnosis,
4analysis, or treatment of hospital patients purchased by a
5lessor who leases the equipment, under a lease of one year or
6longer executed or in effect at the time the lessor would
7otherwise be subject to the tax imposed by this Act, to a
8hospital that has been issued an active tax exemption
9identification number by the Department under Section 1g of the
10Retailers' Occupation Tax Act. If the equipment is leased in a
11manner that does not qualify for this exemption or is used in
12any other non-exempt manner, the lessor shall be liable for the
13tax imposed under this Act or the Service Use Tax Act, as the
14case may be, based on the fair market value of the property at
15the time the non-qualifying use occurs. No lessor shall collect
16or attempt to collect an amount (however designated) that
17purports to reimburse that lessor for the tax imposed by this
18Act or the Service Use Tax Act, as the case may be, if the tax
19has not been paid by the lessor. If a lessor improperly
20collects any such amount from the lessee, the lessee shall have
21a legal right to claim a refund of that amount from the lessor.
22If, however, that amount is not refunded to the lessee for any
23reason, the lessor is liable to pay that amount to the
24Department.
25    (23) Personal property purchased by a lessor who leases the
26property, under a lease of one year or longer executed or in

 

 

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1effect at the time the lessor would otherwise be subject to the
2tax imposed by this Act, to a governmental body that has been
3issued an active sales tax exemption identification number by
4the Department under Section 1g of the Retailers' Occupation
5Tax Act. If the property is leased in a manner that does not
6qualify for this exemption or used in any other non-exempt
7manner, the lessor shall be liable for the tax imposed under
8this Act or the Service Use Tax Act, as the case may be, based
9on the fair market value of the property at the time the
10non-qualifying use occurs. No lessor shall collect or attempt
11to collect an amount (however designated) that purports to
12reimburse that lessor for the tax imposed by this Act or the
13Service Use Tax Act, as the case may be, if the tax has not been
14paid by the lessor. If a lessor improperly collects any such
15amount from the lessee, the lessee shall have a legal right to
16claim a refund of that amount from the lessor. If, however,
17that amount is not refunded to the lessee for any reason, the
18lessor is liable to pay that amount to the Department.
19    (24) Beginning with taxable years ending on or after
20December 31, 1995 and ending with taxable years ending on or
21before December 31, 2004, personal property that is donated for
22disaster relief to be used in a State or federally declared
23disaster area in Illinois or bordering Illinois by a
24manufacturer or retailer that is registered in this State to a
25corporation, society, association, foundation, or institution
26that has been issued a sales tax exemption identification

 

 

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1number by the Department that assists victims of the disaster
2who reside within the declared disaster area.
3    (25) Beginning with taxable years ending on or after
4December 31, 1995 and ending with taxable years ending on or
5before December 31, 2004, personal property that is used in the
6performance of infrastructure repairs in this State, including
7but not limited to municipal roads and streets, access roads,
8bridges, sidewalks, waste disposal systems, water and sewer
9line extensions, water distribution and purification
10facilities, storm water drainage and retention facilities, and
11sewage treatment facilities, resulting from a State or
12federally declared disaster in Illinois or bordering Illinois
13when such repairs are initiated on facilities located in the
14declared disaster area within 6 months after the disaster.
15    (26) Beginning July 1, 1999, game or game birds purchased
16at a "game breeding and hunting preserve area" as that term is
17used in the Wildlife Code. This paragraph is exempt from the
18provisions of Section 3-90.
19    (27) A motor vehicle, as that term is defined in Section
201-146 of the Illinois Vehicle Code, that is donated to a
21corporation, limited liability company, society, association,
22foundation, or institution that is determined by the Department
23to be organized and operated exclusively for educational
24purposes. For purposes of this exemption, "a corporation,
25limited liability company, society, association, foundation,
26or institution organized and operated exclusively for

 

 

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1educational purposes" means all tax-supported public schools,
2private schools that offer systematic instruction in useful
3branches of learning by methods common to public schools and
4that compare favorably in their scope and intensity with the
5course of study presented in tax-supported schools, and
6vocational or technical schools or institutes organized and
7operated exclusively to provide a course of study of not less
8than 6 weeks duration and designed to prepare individuals to
9follow a trade or to pursue a manual, technical, mechanical,
10industrial, business, or commercial occupation.
11    (28) Beginning January 1, 2000, personal property,
12including food, purchased through fundraising events for the
13benefit of a public or private elementary or secondary school,
14a group of those schools, or one or more school districts if
15the events are sponsored by an entity recognized by the school
16district that consists primarily of volunteers and includes
17parents and teachers of the school children. This paragraph
18does not apply to fundraising events (i) for the benefit of
19private home instruction or (ii) for which the fundraising
20entity purchases the personal property sold at the events from
21another individual or entity that sold the property for the
22purpose of resale by the fundraising entity and that profits
23from the sale to the fundraising entity. This paragraph is
24exempt from the provisions of Section 3-90.
25    (29) Beginning January 1, 2000 and through December 31,
262001, new or used automatic vending machines that prepare and

 

 

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1serve hot food and beverages, including coffee, soup, and other
2items, and replacement parts for these machines. Beginning
3January 1, 2002 and through June 30, 2003, machines and parts
4for machines used in commercial, coin-operated amusement and
5vending business if a use or occupation tax is paid on the
6gross receipts derived from the use of the commercial,
7coin-operated amusement and vending machines. This paragraph
8is exempt from the provisions of Section 3-90.
9    (30) Beginning January 1, 2001 and through June 30, 2016,
10food for human consumption that is to be consumed off the
11premises where it is sold (other than alcoholic beverages, soft
12drinks, and food that has been prepared for immediate
13consumption) and prescription and nonprescription medicines,
14drugs, medical appliances, and insulin, urine testing
15materials, syringes, and needles used by diabetics, for human
16use, when purchased for use by a person receiving medical
17assistance under Article V of the Illinois Public Aid Code who
18resides in a licensed long-term care facility, as defined in
19the Nursing Home Care Act, or in a licensed facility as defined
20in the ID/DD Community Care Act, the MC/DD Act, or the
21Specialized Mental Health Rehabilitation Act of 2013.
22    (31) Beginning on August 2, 2001 (the effective date of
23Public Act 92-227), computers and communications equipment
24utilized for any hospital purpose and equipment used in the
25diagnosis, analysis, or treatment of hospital patients
26purchased by a lessor who leases the equipment, under a lease

 

 

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1of one year or longer executed or in effect at the time the
2lessor would otherwise be subject to the tax imposed by this
3Act, to a hospital that has been issued an active tax exemption
4identification number by the Department under Section 1g of the
5Retailers' Occupation Tax Act. If the equipment is leased in a
6manner that does not qualify for this exemption or is used in
7any other nonexempt manner, the lessor shall be liable for the
8tax imposed under this Act or the Service Use Tax Act, as the
9case may be, based on the fair market value of the property at
10the time the nonqualifying use occurs. No lessor shall collect
11or attempt to collect an amount (however designated) that
12purports to reimburse that lessor for the tax imposed by this
13Act or the Service Use Tax Act, as the case may be, if the tax
14has not been paid by the lessor. If a lessor improperly
15collects any such amount from the lessee, the lessee shall have
16a legal right to claim a refund of that amount from the lessor.
17If, however, that amount is not refunded to the lessee for any
18reason, the lessor is liable to pay that amount to the
19Department. This paragraph is exempt from the provisions of
20Section 3-90.
21    (32) Beginning on August 2, 2001 (the effective date of
22Public Act 92-227), personal property purchased by a lessor who
23leases the property, under a lease of one year or longer
24executed or in effect at the time the lessor would otherwise be
25subject to the tax imposed by this Act, to a governmental body
26that has been issued an active sales tax exemption

 

 

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1identification number by the Department under Section 1g of the
2Retailers' Occupation Tax Act. If the property is leased in a
3manner that does not qualify for this exemption or used in any
4other nonexempt manner, the lessor shall be liable for the tax
5imposed under this Act or the Service Use Tax Act, as the case
6may be, based on the fair market value of the property at the
7time the nonqualifying use occurs. No lessor shall collect or
8attempt to collect an amount (however designated) that purports
9to reimburse that lessor for the tax imposed by this Act or the
10Service Use Tax Act, as the case may be, if the tax has not been
11paid by the lessor. If a lessor improperly collects any such
12amount from the lessee, the lessee shall have a legal right to
13claim a refund of that amount from the lessor. If, however,
14that amount is not refunded to the lessee for any reason, the
15lessor is liable to pay that amount to the Department. This
16paragraph is exempt from the provisions of Section 3-90.
17    (33) On and after July 1, 2003 and through June 30, 2004,
18the use in this State of motor vehicles of the second division
19with a gross vehicle weight in excess of 8,000 pounds and that
20are subject to the commercial distribution fee imposed under
21Section 3-815.1 of the Illinois Vehicle Code. Beginning on July
221, 2004 and through June 30, 2005, the use in this State of
23motor vehicles of the second division: (i) with a gross vehicle
24weight rating in excess of 8,000 pounds; (ii) that are subject
25to the commercial distribution fee imposed under Section
263-815.1 of the Illinois Vehicle Code; and (iii) that are

 

 

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1primarily used for commercial purposes. Through June 30, 2005,
2this exemption applies to repair and replacement parts added
3after the initial purchase of such a motor vehicle if that
4motor vehicle is used in a manner that would qualify for the
5rolling stock exemption otherwise provided for in this Act. For
6purposes of this paragraph, the term "used for commercial
7purposes" means the transportation of persons or property in
8furtherance of any commercial or industrial enterprise,
9whether for-hire or not.
10    (34) Beginning January 1, 2008, tangible personal property
11used in the construction or maintenance of a community water
12supply, as defined under Section 3.145 of the Environmental
13Protection Act, that is operated by a not-for-profit
14corporation that holds a valid water supply permit issued under
15Title IV of the Environmental Protection Act. This paragraph is
16exempt from the provisions of Section 3-90.
17    (35) Beginning January 1, 2010, materials, parts,
18equipment, components, and furnishings incorporated into or
19upon an aircraft as part of the modification, refurbishment,
20completion, replacement, repair, or maintenance of the
21aircraft. This exemption includes consumable supplies used in
22the modification, refurbishment, completion, replacement,
23repair, and maintenance of aircraft, but excludes any
24materials, parts, equipment, components, and consumable
25supplies used in the modification, replacement, repair, and
26maintenance of aircraft engines or power plants, whether such

 

 

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1engines or power plants are installed or uninstalled upon any
2such aircraft. "Consumable supplies" include, but are not
3limited to, adhesive, tape, sandpaper, general purpose
4lubricants, cleaning solution, latex gloves, and protective
5films. This exemption applies only to the use of qualifying
6tangible personal property by persons who modify, refurbish,
7complete, repair, replace, or maintain aircraft and who (i)
8hold an Air Agency Certificate and are empowered to operate an
9approved repair station by the Federal Aviation
10Administration, (ii) have a Class IV Rating, and (iii) conduct
11operations in accordance with Part 145 of the Federal Aviation
12Regulations. The exemption does not include aircraft operated
13by a commercial air carrier providing scheduled passenger air
14service pursuant to authority issued under Part 121 or Part 129
15of the Federal Aviation Regulations. The changes made to this
16paragraph (35) by Public Act 98-534 are declarative of existing
17law.
18    (36) Tangible personal property purchased by a
19public-facilities corporation, as described in Section
2011-65-10 of the Illinois Municipal Code, for purposes of
21constructing or furnishing a municipal convention hall, but
22only if the legal title to the municipal convention hall is
23transferred to the municipality without any further
24consideration by or on behalf of the municipality at the time
25of the completion of the municipal convention hall or upon the
26retirement or redemption of any bonds or other debt instruments

 

 

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1issued by the public-facilities corporation in connection with
2the development of the municipal convention hall. This
3exemption includes existing public-facilities corporations as
4provided in Section 11-65-25 of the Illinois Municipal Code.
5This paragraph is exempt from the provisions of Section 3-90.
6    (37) Beginning January 1, 2017, menstrual pads, tampons,
7and menstrual cups.
8    (38) Merchandise that is subject to the Rental Purchase
9Agreement Occupation and Use Tax. The purchaser must certify
10that the item is purchased to be rented subject to a rental
11purchase agreement, as defined in the Rental Purchase Agreement
12Act, and provide proof of registration under the Rental
13Purchase Agreement Occupation and Use Tax Act. This paragraph
14is exempt from the provisions of Section 3-90.
15    (39) Tangible personal property purchased by a purchaser
16who is exempt from the tax imposed by this Act by operation of
17federal law. This paragraph is exempt from the provisions of
18Section 3-90.
19    (40) Products purchased by an eligible apiarist for use in
20producing honey bee products for sale or for providing bee
21pollination services. As used in this paragraph, "eligible
22apiarist" means a person who owns or keeps one or more bee
23colonies and who grows, raises, or produces honey bee products
24for sale at wholesale. As used in this paragraph, "honey bee
25products" means queen honey bees, packaged honey bees, honey,
26pollen, bees wax, propolis, or other substances obtained from

 

 

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1honey bees, but does not include manufactured substances or
2articles. This paragraph is exempt from the provisions of
3Section 3-90.
4(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
5100-22, eff. 7-6-17; 100-437, eff. 1-1-18; 100-594, eff.
66-29-18; 100-863, eff. 8-14-18; 100-1171, eff. 1-4-19; revised
71-8-19.)
 
8    Section 10. The Service Use Tax Act is amended by changing
9Section 3-5 as follows:
 
10    (35 ILCS 110/3-5)
11    Sec. 3-5. Exemptions. Use of the following tangible
12personal property is exempt from the tax imposed by this Act:
13    (1) Personal property purchased from a corporation,
14society, association, foundation, institution, or
15organization, other than a limited liability company, that is
16organized and operated as a not-for-profit service enterprise
17for the benefit of persons 65 years of age or older if the
18personal property was not purchased by the enterprise for the
19purpose of resale by the enterprise.
20    (2) Personal property purchased by a non-profit Illinois
21county fair association for use in conducting, operating, or
22promoting the county fair.
23    (3) Personal property purchased by a not-for-profit arts or
24cultural organization that establishes, by proof required by

 

 

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1the Department by rule, that it has received an exemption under
2Section 501(c)(3) of the Internal Revenue Code and that is
3organized and operated primarily for the presentation or
4support of arts or cultural programming, activities, or
5services. These organizations include, but are not limited to,
6music and dramatic arts organizations such as symphony
7orchestras and theatrical groups, arts and cultural service
8organizations, local arts councils, visual arts organizations,
9and media arts organizations. On and after July 1, 2001 (the
10effective date of Public Act 92-35) this amendatory Act of the
1192nd General Assembly, however, an entity otherwise eligible
12for this exemption shall not make tax-free purchases unless it
13has an active identification number issued by the Department.
14    (4) Legal tender, currency, medallions, or gold or silver
15coinage issued by the State of Illinois, the government of the
16United States of America, or the government of any foreign
17country, and bullion.
18    (5) Until July 1, 2003 and beginning again on September 1,
192004 through August 30, 2014, graphic arts machinery and
20equipment, including repair and replacement parts, both new and
21used, and including that manufactured on special order or
22purchased for lease, certified by the purchaser to be used
23primarily for graphic arts production. Equipment includes
24chemicals or chemicals acting as catalysts but only if the
25chemicals or chemicals acting as catalysts effect a direct and
26immediate change upon a graphic arts product. Beginning on July

 

 

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11, 2017, graphic arts machinery and equipment is included in
2the manufacturing and assembling machinery and equipment
3exemption under Section 2 of this Act.
4    (6) Personal property purchased from a teacher-sponsored
5student organization affiliated with an elementary or
6secondary school located in Illinois.
7    (7) Farm machinery and equipment, both new and used,
8including that manufactured on special order, certified by the
9purchaser to be used primarily for production agriculture or
10State or federal agricultural programs, including individual
11replacement parts for the machinery and equipment, including
12machinery and equipment purchased for lease, and including
13implements of husbandry defined in Section 1-130 of the
14Illinois Vehicle Code, farm machinery and agricultural
15chemical and fertilizer spreaders, and nurse wagons required to
16be registered under Section 3-809 of the Illinois Vehicle Code,
17but excluding other motor vehicles required to be registered
18under the Illinois Vehicle Code. Horticultural polyhouses or
19hoop houses used for propagating, growing, or overwintering
20plants shall be considered farm machinery and equipment under
21this item (7). Agricultural chemical tender tanks and dry boxes
22shall include units sold separately from a motor vehicle
23required to be licensed and units sold mounted on a motor
24vehicle required to be licensed if the selling price of the
25tender is separately stated.
26    Farm machinery and equipment shall include precision

 

 

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1farming equipment that is installed or purchased to be
2installed on farm machinery and equipment including, but not
3limited to, tractors, harvesters, sprayers, planters, seeders,
4or spreaders. Precision farming equipment includes, but is not
5limited to, soil testing sensors, computers, monitors,
6software, global positioning and mapping systems, and other
7such equipment.
8    Farm machinery and equipment also includes computers,
9sensors, software, and related equipment used primarily in the
10computer-assisted operation of production agriculture
11facilities, equipment, and activities such as, but not limited
12to, the collection, monitoring, and correlation of animal and
13crop data for the purpose of formulating animal diets and
14agricultural chemicals. This item (7) is exempt from the
15provisions of Section 3-75.
16    (8) Until June 30, 2013, fuel and petroleum products sold
17to or used by an air common carrier, certified by the carrier
18to be used for consumption, shipment, or storage in the conduct
19of its business as an air common carrier, for a flight destined
20for or returning from a location or locations outside the
21United States without regard to previous or subsequent domestic
22stopovers.
23    Beginning July 1, 2013, fuel and petroleum products sold to
24or used by an air carrier, certified by the carrier to be used
25for consumption, shipment, or storage in the conduct of its
26business as an air common carrier, for a flight that (i) is

 

 

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1engaged in foreign trade or is engaged in trade between the
2United States and any of its possessions and (ii) transports at
3least one individual or package for hire from the city of
4origination to the city of final destination on the same
5aircraft, without regard to a change in the flight number of
6that aircraft.
7    (9) Proceeds of mandatory service charges separately
8stated on customers' bills for the purchase and consumption of
9food and beverages acquired as an incident to the purchase of a
10service from a serviceman, to the extent that the proceeds of
11the service charge are in fact turned over as tips or as a
12substitute for tips to the employees who participate directly
13in preparing, serving, hosting or cleaning up the food or
14beverage function with respect to which the service charge is
15imposed.
16    (10) Until July 1, 2003, oil field exploration, drilling,
17and production equipment, including (i) rigs and parts of rigs,
18rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
19tubular goods, including casing and drill strings, (iii) pumps
20and pump-jack units, (iv) storage tanks and flow lines, (v) any
21individual replacement part for oil field exploration,
22drilling, and production equipment, and (vi) machinery and
23equipment purchased for lease; but excluding motor vehicles
24required to be registered under the Illinois Vehicle Code.
25    (11) Proceeds from the sale of photoprocessing machinery
26and equipment, including repair and replacement parts, both new

 

 

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1and used, including that manufactured on special order,
2certified by the purchaser to be used primarily for
3photoprocessing, and including photoprocessing machinery and
4equipment purchased for lease.
5    (12) Until July 1, 2023, coal and aggregate exploration,
6mining, off-highway hauling, processing, maintenance, and
7reclamation equipment, including replacement parts and
8equipment, and including equipment purchased for lease, but
9excluding motor vehicles required to be registered under the
10Illinois Vehicle Code. The changes made to this Section by
11Public Act 97-767 apply on and after July 1, 2003, but no claim
12for credit or refund is allowed on or after August 16, 2013
13(the effective date of Public Act 98-456) for such taxes paid
14during the period beginning July 1, 2003 and ending on August
1516, 2013 (the effective date of Public Act 98-456).
16    (13) Semen used for artificial insemination of livestock
17for direct agricultural production.
18    (14) Horses, or interests in horses, registered with and
19meeting the requirements of any of the Arabian Horse Club
20Registry of America, Appaloosa Horse Club, American Quarter
21Horse Association, United States Trotting Association, or
22Jockey Club, as appropriate, used for purposes of breeding or
23racing for prizes. This item (14) is exempt from the provisions
24of Section 3-75, and the exemption provided for under this item
25(14) applies for all periods beginning May 30, 1995, but no
26claim for credit or refund is allowed on or after January 1,

 

 

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12008 (the effective date of Public Act 95-88) this amendatory
2Act of the 95th General Assembly for such taxes paid during the
3period beginning May 30, 2000 and ending on January 1, 2008
4(the effective date of Public Act 95-88) this amendatory Act of
5the 95th General Assembly.
6    (15) Computers and communications equipment utilized for
7any hospital purpose and equipment used in the diagnosis,
8analysis, or treatment of hospital patients purchased by a
9lessor who leases the equipment, under a lease of one year or
10longer executed or in effect at the time the lessor would
11otherwise be subject to the tax imposed by this Act, to a
12hospital that has been issued an active tax exemption
13identification number by the Department under Section 1g of the
14Retailers' Occupation Tax Act. If the equipment is leased in a
15manner that does not qualify for this exemption or is used in
16any other non-exempt manner, the lessor shall be liable for the
17tax imposed under this Act or the Use Tax Act, as the case may
18be, based on the fair market value of the property at the time
19the non-qualifying use occurs. No lessor shall collect or
20attempt to collect an amount (however designated) that purports
21to reimburse that lessor for the tax imposed by this Act or the
22Use Tax Act, as the case may be, if the tax has not been paid by
23the lessor. If a lessor improperly collects any such amount
24from the lessee, the lessee shall have a legal right to claim a
25refund of that amount from the lessor. If, however, that amount
26is not refunded to the lessee for any reason, the lessor is

 

 

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1liable to pay that amount to the Department.
2    (16) Personal property purchased by a lessor who leases the
3property, under a lease of one year or longer executed or in
4effect at the time the lessor would otherwise be subject to the
5tax imposed by this Act, to a governmental body that has been
6issued an active tax exemption identification number by the
7Department under Section 1g of the Retailers' Occupation Tax
8Act. If the property is leased in a manner that does not
9qualify for this exemption or is used in any other non-exempt
10manner, the lessor shall be liable for the tax imposed under
11this Act or the Use Tax Act, as the case may be, based on the
12fair market value of the property at the time the
13non-qualifying use occurs. No lessor shall collect or attempt
14to collect an amount (however designated) that purports to
15reimburse that lessor for the tax imposed by this Act or the
16Use Tax Act, as the case may be, if the tax has not been paid by
17the lessor. If a lessor improperly collects any such amount
18from the lessee, the lessee shall have a legal right to claim a
19refund of that amount from the lessor. If, however, that amount
20is not refunded to the lessee for any reason, the lessor is
21liable to pay that amount to the Department.
22    (17) Beginning with taxable years ending on or after
23December 31, 1995 and ending with taxable years ending on or
24before December 31, 2004, personal property that is donated for
25disaster relief to be used in a State or federally declared
26disaster area in Illinois or bordering Illinois by a

 

 

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1manufacturer or retailer that is registered in this State to a
2corporation, society, association, foundation, or institution
3that has been issued a sales tax exemption identification
4number by the Department that assists victims of the disaster
5who reside within the declared disaster area.
6    (18) Beginning with taxable years ending on or after
7December 31, 1995 and ending with taxable years ending on or
8before December 31, 2004, personal property that is used in the
9performance of infrastructure repairs in this State, including
10but not limited to municipal roads and streets, access roads,
11bridges, sidewalks, waste disposal systems, water and sewer
12line extensions, water distribution and purification
13facilities, storm water drainage and retention facilities, and
14sewage treatment facilities, resulting from a State or
15federally declared disaster in Illinois or bordering Illinois
16when such repairs are initiated on facilities located in the
17declared disaster area within 6 months after the disaster.
18    (19) Beginning July 1, 1999, game or game birds purchased
19at a "game breeding and hunting preserve area" as that term is
20used in the Wildlife Code. This paragraph is exempt from the
21provisions of Section 3-75.
22    (20) A motor vehicle, as that term is defined in Section
231-146 of the Illinois Vehicle Code, that is donated to a
24corporation, limited liability company, society, association,
25foundation, or institution that is determined by the Department
26to be organized and operated exclusively for educational

 

 

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1purposes. For purposes of this exemption, "a corporation,
2limited liability company, society, association, foundation,
3or institution organized and operated exclusively for
4educational purposes" means all tax-supported public schools,
5private schools that offer systematic instruction in useful
6branches of learning by methods common to public schools and
7that compare favorably in their scope and intensity with the
8course of study presented in tax-supported schools, and
9vocational or technical schools or institutes organized and
10operated exclusively to provide a course of study of not less
11than 6 weeks duration and designed to prepare individuals to
12follow a trade or to pursue a manual, technical, mechanical,
13industrial, business, or commercial occupation.
14    (21) Beginning January 1, 2000, personal property,
15including food, purchased through fundraising events for the
16benefit of a public or private elementary or secondary school,
17a group of those schools, or one or more school districts if
18the events are sponsored by an entity recognized by the school
19district that consists primarily of volunteers and includes
20parents and teachers of the school children. This paragraph
21does not apply to fundraising events (i) for the benefit of
22private home instruction or (ii) for which the fundraising
23entity purchases the personal property sold at the events from
24another individual or entity that sold the property for the
25purpose of resale by the fundraising entity and that profits
26from the sale to the fundraising entity. This paragraph is

 

 

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1exempt from the provisions of Section 3-75.
2    (22) Beginning January 1, 2000 and through December 31,
32001, new or used automatic vending machines that prepare and
4serve hot food and beverages, including coffee, soup, and other
5items, and replacement parts for these machines. Beginning
6January 1, 2002 and through June 30, 2003, machines and parts
7for machines used in commercial, coin-operated amusement and
8vending business if a use or occupation tax is paid on the
9gross receipts derived from the use of the commercial,
10coin-operated amusement and vending machines. This paragraph
11is exempt from the provisions of Section 3-75.
12    (23) Beginning August 23, 2001 and through June 30, 2016,
13food for human consumption that is to be consumed off the
14premises where it is sold (other than alcoholic beverages, soft
15drinks, and food that has been prepared for immediate
16consumption) and prescription and nonprescription medicines,
17drugs, medical appliances, and insulin, urine testing
18materials, syringes, and needles used by diabetics, for human
19use, when purchased for use by a person receiving medical
20assistance under Article V of the Illinois Public Aid Code who
21resides in a licensed long-term care facility, as defined in
22the Nursing Home Care Act, or in a licensed facility as defined
23in the ID/DD Community Care Act, the MC/DD Act, or the
24Specialized Mental Health Rehabilitation Act of 2013.
25    (24) Beginning on August 2, 2001 (the effective date of
26Public Act 92-227) this amendatory Act of the 92nd General

 

 

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1Assembly, computers and communications equipment utilized for
2any hospital purpose and equipment used in the diagnosis,
3analysis, or treatment of hospital patients purchased by a
4lessor who leases the equipment, under a lease of one year or
5longer executed or in effect at the time the lessor would
6otherwise be subject to the tax imposed by this Act, to a
7hospital that has been issued an active tax exemption
8identification number by the Department under Section 1g of the
9Retailers' Occupation Tax Act. If the equipment is leased in a
10manner that does not qualify for this exemption or is used in
11any other nonexempt manner, the lessor shall be liable for the
12tax imposed under this Act or the Use Tax Act, as the case may
13be, based on the fair market value of the property at the time
14the nonqualifying use occurs. No lessor shall collect or
15attempt to collect an amount (however designated) that purports
16to reimburse that lessor for the tax imposed by this Act or the
17Use Tax Act, as the case may be, if the tax has not been paid by
18the lessor. If a lessor improperly collects any such amount
19from the lessee, the lessee shall have a legal right to claim a
20refund of that amount from the lessor. If, however, that amount
21is not refunded to the lessee for any reason, the lessor is
22liable to pay that amount to the Department. This paragraph is
23exempt from the provisions of Section 3-75.
24    (25) Beginning on August 2, 2001 (the effective date of
25Public Act 92-227) this amendatory Act of the 92nd General
26Assembly, personal property purchased by a lessor who leases

 

 

SB1678- 31 -LRB101 09656 HLH 54755 b

1the property, under a lease of one year or longer executed or
2in effect at the time the lessor would otherwise be subject to
3the tax imposed by this Act, to a governmental body that has
4been issued an active tax exemption identification number by
5the Department under Section 1g of the Retailers' Occupation
6Tax Act. If the property is leased in a manner that does not
7qualify for this exemption or is used in any other nonexempt
8manner, the lessor shall be liable for the tax imposed under
9this Act or the Use Tax Act, as the case may be, based on the
10fair market value of the property at the time the nonqualifying
11use occurs. No lessor shall collect or attempt to collect an
12amount (however designated) that purports to reimburse that
13lessor for the tax imposed by this Act or the Use Tax Act, as
14the case may be, if the tax has not been paid by the lessor. If
15a lessor improperly collects any such amount from the lessee,
16the lessee shall have a legal right to claim a refund of that
17amount from the lessor. If, however, that amount is not
18refunded to the lessee for any reason, the lessor is liable to
19pay that amount to the Department. This paragraph is exempt
20from the provisions of Section 3-75.
21    (26) Beginning January 1, 2008, tangible personal property
22used in the construction or maintenance of a community water
23supply, as defined under Section 3.145 of the Environmental
24Protection Act, that is operated by a not-for-profit
25corporation that holds a valid water supply permit issued under
26Title IV of the Environmental Protection Act. This paragraph is

 

 

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1exempt from the provisions of Section 3-75.
2    (27) Beginning January 1, 2010, materials, parts,
3equipment, components, and furnishings incorporated into or
4upon an aircraft as part of the modification, refurbishment,
5completion, replacement, repair, or maintenance of the
6aircraft. This exemption includes consumable supplies used in
7the modification, refurbishment, completion, replacement,
8repair, and maintenance of aircraft, but excludes any
9materials, parts, equipment, components, and consumable
10supplies used in the modification, replacement, repair, and
11maintenance of aircraft engines or power plants, whether such
12engines or power plants are installed or uninstalled upon any
13such aircraft. "Consumable supplies" include, but are not
14limited to, adhesive, tape, sandpaper, general purpose
15lubricants, cleaning solution, latex gloves, and protective
16films. This exemption applies only to the use of qualifying
17tangible personal property transferred incident to the
18modification, refurbishment, completion, replacement, repair,
19or maintenance of aircraft by persons who (i) hold an Air
20Agency Certificate and are empowered to operate an approved
21repair station by the Federal Aviation Administration, (ii)
22have a Class IV Rating, and (iii) conduct operations in
23accordance with Part 145 of the Federal Aviation Regulations.
24The exemption does not include aircraft operated by a
25commercial air carrier providing scheduled passenger air
26service pursuant to authority issued under Part 121 or Part 129

 

 

SB1678- 33 -LRB101 09656 HLH 54755 b

1of the Federal Aviation Regulations. The changes made to this
2paragraph (27) by Public Act 98-534 are declarative of existing
3law.
4    (28) Tangible personal property purchased by a
5public-facilities corporation, as described in Section
611-65-10 of the Illinois Municipal Code, for purposes of
7constructing or furnishing a municipal convention hall, but
8only if the legal title to the municipal convention hall is
9transferred to the municipality without any further
10consideration by or on behalf of the municipality at the time
11of the completion of the municipal convention hall or upon the
12retirement or redemption of any bonds or other debt instruments
13issued by the public-facilities corporation in connection with
14the development of the municipal convention hall. This
15exemption includes existing public-facilities corporations as
16provided in Section 11-65-25 of the Illinois Municipal Code.
17This paragraph is exempt from the provisions of Section 3-75.
18    (29) Beginning January 1, 2017, menstrual pads, tampons,
19and menstrual cups.
20    (30) Tangible personal property transferred to a purchaser
21who is exempt from the tax imposed by this Act by operation of
22federal law. This paragraph is exempt from the provisions of
23Section 3-75.
24    (31) Products purchased by an eligible apiarist for use in
25producing honey bee products for sale or for providing bee
26pollination services. As used in this paragraph, "eligible

 

 

SB1678- 34 -LRB101 09656 HLH 54755 b

1apiarist" means a person who owns or keeps one or more bee
2colonies and who grows, raises, or produces honey bee products
3for sale at wholesale. As used in this paragraph, "honey bee
4products" means queen honey bees, packaged honey bees, honey,
5pollen, bees wax, propolis, or other substances obtained from
6honey bees, but does not include manufactured substances or
7articles. This paragraph is exempt from the provisions of
8Section 3-75.
9(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
10100-22, eff. 7-6-17; 100-594, eff. 6-29-18; 100-1171, eff.
111-4-19; revised 1-8-19.)
 
12    Section 15. The Service Occupation Tax Act is amended by
13changing Section 3-5 as follows:
 
14    (35 ILCS 115/3-5)
15    Sec. 3-5. Exemptions. The following tangible personal
16property is exempt from the tax imposed by this Act:
17    (1) Personal property sold by a corporation, society,
18association, foundation, institution, or organization, other
19than a limited liability company, that is organized and
20operated as a not-for-profit service enterprise for the benefit
21of persons 65 years of age or older if the personal property
22was not purchased by the enterprise for the purpose of resale
23by the enterprise.
24    (2) Personal property purchased by a not-for-profit

 

 

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1Illinois county fair association for use in conducting,
2operating, or promoting the county fair.
3    (3) Personal property purchased by any not-for-profit arts
4or cultural organization that establishes, by proof required by
5the Department by rule, that it has received an exemption under
6Section 501(c)(3) of the Internal Revenue Code and that is
7organized and operated primarily for the presentation or
8support of arts or cultural programming, activities, or
9services. These organizations include, but are not limited to,
10music and dramatic arts organizations such as symphony
11orchestras and theatrical groups, arts and cultural service
12organizations, local arts councils, visual arts organizations,
13and media arts organizations. On and after July 1, 2001 (the
14effective date of Public Act 92-35) this amendatory Act of the
1592nd General Assembly, however, an entity otherwise eligible
16for this exemption shall not make tax-free purchases unless it
17has an active identification number issued by the Department.
18    (4) Legal tender, currency, medallions, or gold or silver
19coinage issued by the State of Illinois, the government of the
20United States of America, or the government of any foreign
21country, and bullion.
22    (5) Until July 1, 2003 and beginning again on September 1,
232004 through August 30, 2014, graphic arts machinery and
24equipment, including repair and replacement parts, both new and
25used, and including that manufactured on special order or
26purchased for lease, certified by the purchaser to be used

 

 

SB1678- 36 -LRB101 09656 HLH 54755 b

1primarily for graphic arts production. Equipment includes
2chemicals or chemicals acting as catalysts but only if the
3chemicals or chemicals acting as catalysts effect a direct and
4immediate change upon a graphic arts product. Beginning on July
51, 2017, graphic arts machinery and equipment is included in
6the manufacturing and assembling machinery and equipment
7exemption under Section 2 of this Act.
8    (6) Personal property sold by a teacher-sponsored student
9organization affiliated with an elementary or secondary school
10located in Illinois.
11    (7) Farm machinery and equipment, both new and used,
12including that manufactured on special order, certified by the
13purchaser to be used primarily for production agriculture or
14State or federal agricultural programs, including individual
15replacement parts for the machinery and equipment, including
16machinery and equipment purchased for lease, and including
17implements of husbandry defined in Section 1-130 of the
18Illinois Vehicle Code, farm machinery and agricultural
19chemical and fertilizer spreaders, and nurse wagons required to
20be registered under Section 3-809 of the Illinois Vehicle Code,
21but excluding other motor vehicles required to be registered
22under the Illinois Vehicle Code. Horticultural polyhouses or
23hoop houses used for propagating, growing, or overwintering
24plants shall be considered farm machinery and equipment under
25this item (7). Agricultural chemical tender tanks and dry boxes
26shall include units sold separately from a motor vehicle

 

 

SB1678- 37 -LRB101 09656 HLH 54755 b

1required to be licensed and units sold mounted on a motor
2vehicle required to be licensed if the selling price of the
3tender is separately stated.
4    Farm machinery and equipment shall include precision
5farming equipment that is installed or purchased to be
6installed on farm machinery and equipment including, but not
7limited to, tractors, harvesters, sprayers, planters, seeders,
8or spreaders. Precision farming equipment includes, but is not
9limited to, soil testing sensors, computers, monitors,
10software, global positioning and mapping systems, and other
11such equipment.
12    Farm machinery and equipment also includes computers,
13sensors, software, and related equipment used primarily in the
14computer-assisted operation of production agriculture
15facilities, equipment, and activities such as, but not limited
16to, the collection, monitoring, and correlation of animal and
17crop data for the purpose of formulating animal diets and
18agricultural chemicals. This item (7) is exempt from the
19provisions of Section 3-55.
20    (8) Until June 30, 2013, fuel and petroleum products sold
21to or used by an air common carrier, certified by the carrier
22to be used for consumption, shipment, or storage in the conduct
23of its business as an air common carrier, for a flight destined
24for or returning from a location or locations outside the
25United States without regard to previous or subsequent domestic
26stopovers.

 

 

SB1678- 38 -LRB101 09656 HLH 54755 b

1    Beginning July 1, 2013, fuel and petroleum products sold to
2or used by an air carrier, certified by the carrier to be used
3for consumption, shipment, or storage in the conduct of its
4business as an air common carrier, for a flight that (i) is
5engaged in foreign trade or is engaged in trade between the
6United States and any of its possessions and (ii) transports at
7least one individual or package for hire from the city of
8origination to the city of final destination on the same
9aircraft, without regard to a change in the flight number of
10that aircraft.
11    (9) Proceeds of mandatory service charges separately
12stated on customers' bills for the purchase and consumption of
13food and beverages, to the extent that the proceeds of the
14service charge are in fact turned over as tips or as a
15substitute for tips to the employees who participate directly
16in preparing, serving, hosting or cleaning up the food or
17beverage function with respect to which the service charge is
18imposed.
19    (10) Until July 1, 2003, oil field exploration, drilling,
20and production equipment, including (i) rigs and parts of rigs,
21rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
22tubular goods, including casing and drill strings, (iii) pumps
23and pump-jack units, (iv) storage tanks and flow lines, (v) any
24individual replacement part for oil field exploration,
25drilling, and production equipment, and (vi) machinery and
26equipment purchased for lease; but excluding motor vehicles

 

 

SB1678- 39 -LRB101 09656 HLH 54755 b

1required to be registered under the Illinois Vehicle Code.
2    (11) Photoprocessing machinery and equipment, including
3repair and replacement parts, both new and used, including that
4manufactured on special order, certified by the purchaser to be
5used primarily for photoprocessing, and including
6photoprocessing machinery and equipment purchased for lease.
7    (12) Until July 1, 2023, coal and aggregate exploration,
8mining, off-highway hauling, processing, maintenance, and
9reclamation equipment, including replacement parts and
10equipment, and including equipment purchased for lease, but
11excluding motor vehicles required to be registered under the
12Illinois Vehicle Code. The changes made to this Section by
13Public Act 97-767 apply on and after July 1, 2003, but no claim
14for credit or refund is allowed on or after August 16, 2013
15(the effective date of Public Act 98-456) for such taxes paid
16during the period beginning July 1, 2003 and ending on August
1716, 2013 (the effective date of Public Act 98-456).
18    (13) Beginning January 1, 1992 and through June 30, 2016,
19food for human consumption that is to be consumed off the
20premises where it is sold (other than alcoholic beverages, soft
21drinks and food that has been prepared for immediate
22consumption) and prescription and non-prescription medicines,
23drugs, medical appliances, and insulin, urine testing
24materials, syringes, and needles used by diabetics, for human
25use, when purchased for use by a person receiving medical
26assistance under Article V of the Illinois Public Aid Code who

 

 

SB1678- 40 -LRB101 09656 HLH 54755 b

1resides in a licensed long-term care facility, as defined in
2the Nursing Home Care Act, or in a licensed facility as defined
3in the ID/DD Community Care Act, the MC/DD Act, or the
4Specialized Mental Health Rehabilitation Act of 2013.
5    (14) Semen used for artificial insemination of livestock
6for direct agricultural production.
7    (15) Horses, or interests in horses, registered with and
8meeting the requirements of any of the Arabian Horse Club
9Registry of America, Appaloosa Horse Club, American Quarter
10Horse Association, United States Trotting Association, or
11Jockey Club, as appropriate, used for purposes of breeding or
12racing for prizes. This item (15) is exempt from the provisions
13of Section 3-55, and the exemption provided for under this item
14(15) applies for all periods beginning May 30, 1995, but no
15claim for credit or refund is allowed on or after January 1,
162008 (the effective date of Public Act 95-88) for such taxes
17paid during the period beginning May 30, 2000 and ending on
18January 1, 2008 (the effective date of Public Act 95-88).
19    (16) Computers and communications equipment utilized for
20any hospital purpose and equipment used in the diagnosis,
21analysis, or treatment of hospital patients sold to a lessor
22who leases the equipment, under a lease of one year or longer
23executed or in effect at the time of the purchase, to a
24hospital that has been issued an active tax exemption
25identification number by the Department under Section 1g of the
26Retailers' Occupation Tax Act.

 

 

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1    (17) Personal property sold to a lessor who leases the
2property, under a lease of one year or longer executed or in
3effect at the time of the purchase, to a governmental body that
4has been issued an active tax exemption identification number
5by the Department under Section 1g of the Retailers' Occupation
6Tax Act.
7    (18) Beginning with taxable years ending on or after
8December 31, 1995 and ending with taxable years ending on or
9before December 31, 2004, personal property that is donated for
10disaster relief to be used in a State or federally declared
11disaster area in Illinois or bordering Illinois by a
12manufacturer or retailer that is registered in this State to a
13corporation, society, association, foundation, or institution
14that has been issued a sales tax exemption identification
15number by the Department that assists victims of the disaster
16who reside within the declared disaster area.
17    (19) Beginning with taxable years ending on or after
18December 31, 1995 and ending with taxable years ending on or
19before December 31, 2004, personal property that is used in the
20performance of infrastructure repairs in this State, including
21but not limited to municipal roads and streets, access roads,
22bridges, sidewalks, waste disposal systems, water and sewer
23line extensions, water distribution and purification
24facilities, storm water drainage and retention facilities, and
25sewage treatment facilities, resulting from a State or
26federally declared disaster in Illinois or bordering Illinois

 

 

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1when such repairs are initiated on facilities located in the
2declared disaster area within 6 months after the disaster.
3    (20) Beginning July 1, 1999, game or game birds sold at a
4"game breeding and hunting preserve area" as that term is used
5in the Wildlife Code. This paragraph is exempt from the
6provisions of Section 3-55.
7    (21) A motor vehicle, as that term is defined in Section
81-146 of the Illinois Vehicle Code, that is donated to a
9corporation, limited liability company, society, association,
10foundation, or institution that is determined by the Department
11to be organized and operated exclusively for educational
12purposes. For purposes of this exemption, "a corporation,
13limited liability company, society, association, foundation,
14or institution organized and operated exclusively for
15educational purposes" means all tax-supported public schools,
16private schools that offer systematic instruction in useful
17branches of learning by methods common to public schools and
18that compare favorably in their scope and intensity with the
19course of study presented in tax-supported schools, and
20vocational or technical schools or institutes organized and
21operated exclusively to provide a course of study of not less
22than 6 weeks duration and designed to prepare individuals to
23follow a trade or to pursue a manual, technical, mechanical,
24industrial, business, or commercial occupation.
25    (22) Beginning January 1, 2000, personal property,
26including food, purchased through fundraising events for the

 

 

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1benefit of a public or private elementary or secondary school,
2a group of those schools, or one or more school districts if
3the events are sponsored by an entity recognized by the school
4district that consists primarily of volunteers and includes
5parents and teachers of the school children. This paragraph
6does not apply to fundraising events (i) for the benefit of
7private home instruction or (ii) for which the fundraising
8entity purchases the personal property sold at the events from
9another individual or entity that sold the property for the
10purpose of resale by the fundraising entity and that profits
11from the sale to the fundraising entity. This paragraph is
12exempt from the provisions of Section 3-55.
13    (23) Beginning January 1, 2000 and through December 31,
142001, new or used automatic vending machines that prepare and
15serve hot food and beverages, including coffee, soup, and other
16items, and replacement parts for these machines. Beginning
17January 1, 2002 and through June 30, 2003, machines and parts
18for machines used in commercial, coin-operated amusement and
19vending business if a use or occupation tax is paid on the
20gross receipts derived from the use of the commercial,
21coin-operated amusement and vending machines. This paragraph
22is exempt from the provisions of Section 3-55.
23    (24) Beginning on August 2, 2001 (the effective date of
24Public Act 92-227) this amendatory Act of the 92nd General
25Assembly, computers and communications equipment utilized for
26any hospital purpose and equipment used in the diagnosis,

 

 

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1analysis, or treatment of hospital patients sold to a lessor
2who leases the equipment, under a lease of one year or longer
3executed or in effect at the time of the purchase, to a
4hospital that has been issued an active tax exemption
5identification number by the Department under Section 1g of the
6Retailers' Occupation Tax Act. This paragraph is exempt from
7the provisions of Section 3-55.
8    (25) Beginning on August 2, 2001 (the effective date of
9Public Act 92-227) this amendatory Act of the 92nd General
10Assembly, personal property sold to a lessor who leases the
11property, under a lease of one year or longer executed or in
12effect at the time of the purchase, to a governmental body that
13has been issued an active tax exemption identification number
14by the Department under Section 1g of the Retailers' Occupation
15Tax Act. This paragraph is exempt from the provisions of
16Section 3-55.
17    (26) Beginning on January 1, 2002 and through June 30,
182016, tangible personal property purchased from an Illinois
19retailer by a taxpayer engaged in centralized purchasing
20activities in Illinois who will, upon receipt of the property
21in Illinois, temporarily store the property in Illinois (i) for
22the purpose of subsequently transporting it outside this State
23for use or consumption thereafter solely outside this State or
24(ii) for the purpose of being processed, fabricated, or
25manufactured into, attached to, or incorporated into other
26tangible personal property to be transported outside this State

 

 

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1and thereafter used or consumed solely outside this State. The
2Director of Revenue shall, pursuant to rules adopted in
3accordance with the Illinois Administrative Procedure Act,
4issue a permit to any taxpayer in good standing with the
5Department who is eligible for the exemption under this
6paragraph (26). The permit issued under this paragraph (26)
7shall authorize the holder, to the extent and in the manner
8specified in the rules adopted under this Act, to purchase
9tangible personal property from a retailer exempt from the
10taxes imposed by this Act. Taxpayers shall maintain all
11necessary books and records to substantiate the use and
12consumption of all such tangible personal property outside of
13the State of Illinois.
14    (27) Beginning January 1, 2008, tangible personal property
15used in the construction or maintenance of a community water
16supply, as defined under Section 3.145 of the Environmental
17Protection Act, that is operated by a not-for-profit
18corporation that holds a valid water supply permit issued under
19Title IV of the Environmental Protection Act. This paragraph is
20exempt from the provisions of Section 3-55.
21    (28) Tangible personal property sold to a
22public-facilities corporation, as described in Section
2311-65-10 of the Illinois Municipal Code, for purposes of
24constructing or furnishing a municipal convention hall, but
25only if the legal title to the municipal convention hall is
26transferred to the municipality without any further

 

 

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1consideration by or on behalf of the municipality at the time
2of the completion of the municipal convention hall or upon the
3retirement or redemption of any bonds or other debt instruments
4issued by the public-facilities corporation in connection with
5the development of the municipal convention hall. This
6exemption includes existing public-facilities corporations as
7provided in Section 11-65-25 of the Illinois Municipal Code.
8This paragraph is exempt from the provisions of Section 3-55.
9    (29) Beginning January 1, 2010, materials, parts,
10equipment, components, and furnishings incorporated into or
11upon an aircraft as part of the modification, refurbishment,
12completion, replacement, repair, or maintenance of the
13aircraft. This exemption includes consumable supplies used in
14the modification, refurbishment, completion, replacement,
15repair, and maintenance of aircraft, but excludes any
16materials, parts, equipment, components, and consumable
17supplies used in the modification, replacement, repair, and
18maintenance of aircraft engines or power plants, whether such
19engines or power plants are installed or uninstalled upon any
20such aircraft. "Consumable supplies" include, but are not
21limited to, adhesive, tape, sandpaper, general purpose
22lubricants, cleaning solution, latex gloves, and protective
23films. This exemption applies only to the transfer of
24qualifying tangible personal property incident to the
25modification, refurbishment, completion, replacement, repair,
26or maintenance of an aircraft by persons who (i) hold an Air

 

 

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1Agency Certificate and are empowered to operate an approved
2repair station by the Federal Aviation Administration, (ii)
3have a Class IV Rating, and (iii) conduct operations in
4accordance with Part 145 of the Federal Aviation Regulations.
5The exemption does not include aircraft operated by a
6commercial air carrier providing scheduled passenger air
7service pursuant to authority issued under Part 121 or Part 129
8of the Federal Aviation Regulations. The changes made to this
9paragraph (29) by Public Act 98-534 are declarative of existing
10law.
11    (30) Beginning January 1, 2017, menstrual pads, tampons,
12and menstrual cups.
13    (31) Tangible personal property transferred to a purchaser
14who is exempt from tax by operation of federal law. This
15paragraph is exempt from the provisions of Section 3-55.
16    (32) Products purchased by an eligible apiarist for use in
17producing honey bee products for sale or for providing bee
18pollination services. As used in this paragraph, "eligible
19apiarist" means a person who owns or keeps one or more bee
20colonies and who grows, raises, or produces honey bee products
21for sale at wholesale. As used in this paragraph, "honey bee
22products" means queen honey bees, packaged honey bees, honey,
23pollen, bees wax, propolis, or other substances obtained from
24honey bees, but does not include manufactured substances or
25articles. This paragraph is exempt from the provisions of
26Section 3-55.

 

 

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1(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
2100-22, eff. 7-6-17; 100-594, eff. 6-29-18; 100-1171, eff.
31-4-19; revised 1-8-19.)
 
4    Section 20. The Retailers' Occupation Tax Act is amended by
5changing Section 2-5 as follows:
 
6    (35 ILCS 120/2-5)
7    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
8sale of the following tangible personal property are exempt
9from the tax imposed by this Act:
10        (1) Farm chemicals.
11        (2) Farm machinery and equipment, both new and used,
12    including that manufactured on special order, certified by
13    the purchaser to be used primarily for production
14    agriculture or State or federal agricultural programs,
15    including individual replacement parts for the machinery
16    and equipment, including machinery and equipment purchased
17    for lease, and including implements of husbandry defined in
18    Section 1-130 of the Illinois Vehicle Code, farm machinery
19    and agricultural chemical and fertilizer spreaders, and
20    nurse wagons required to be registered under Section 3-809
21    of the Illinois Vehicle Code, but excluding other motor
22    vehicles required to be registered under the Illinois
23    Vehicle Code. Horticultural polyhouses or hoop houses used
24    for propagating, growing, or overwintering plants shall be

 

 

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1    considered farm machinery and equipment under this item
2    (2). Agricultural chemical tender tanks and dry boxes shall
3    include units sold separately from a motor vehicle required
4    to be licensed and units sold mounted on a motor vehicle
5    required to be licensed, if the selling price of the tender
6    is separately stated.
7        Farm machinery and equipment shall include precision
8    farming equipment that is installed or purchased to be
9    installed on farm machinery and equipment including, but
10    not limited to, tractors, harvesters, sprayers, planters,
11    seeders, or spreaders. Precision farming equipment
12    includes, but is not limited to, soil testing sensors,
13    computers, monitors, software, global positioning and
14    mapping systems, and other such equipment.
15        Farm machinery and equipment also includes computers,
16    sensors, software, and related equipment used primarily in
17    the computer-assisted operation of production agriculture
18    facilities, equipment, and activities such as, but not
19    limited to, the collection, monitoring, and correlation of
20    animal and crop data for the purpose of formulating animal
21    diets and agricultural chemicals. This item (2) is exempt
22    from the provisions of Section 2-70.
23        (3) Until July 1, 2003, distillation machinery and
24    equipment, sold as a unit or kit, assembled or installed by
25    the retailer, certified by the user to be used only for the
26    production of ethyl alcohol that will be used for

 

 

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1    consumption as motor fuel or as a component of motor fuel
2    for the personal use of the user, and not subject to sale
3    or resale.
4        (4) Until July 1, 2003 and beginning again September 1,
5    2004 through August 30, 2014, graphic arts machinery and
6    equipment, including repair and replacement parts, both
7    new and used, and including that manufactured on special
8    order or purchased for lease, certified by the purchaser to
9    be used primarily for graphic arts production. Equipment
10    includes chemicals or chemicals acting as catalysts but
11    only if the chemicals or chemicals acting as catalysts
12    effect a direct and immediate change upon a graphic arts
13    product. Beginning on July 1, 2017, graphic arts machinery
14    and equipment is included in the manufacturing and
15    assembling machinery and equipment exemption under
16    paragraph (14).
17        (5) A motor vehicle that is used for automobile
18    renting, as defined in the Automobile Renting Occupation
19    and Use Tax Act. This paragraph is exempt from the
20    provisions of Section 2-70.
21        (6) Personal property sold by a teacher-sponsored
22    student organization affiliated with an elementary or
23    secondary school located in Illinois.
24        (7) Until July 1, 2003, proceeds of that portion of the
25    selling price of a passenger car the sale of which is
26    subject to the Replacement Vehicle Tax.

 

 

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1        (8) Personal property sold to an Illinois county fair
2    association for use in conducting, operating, or promoting
3    the county fair.
4        (9) Personal property sold to a not-for-profit arts or
5    cultural organization that establishes, by proof required
6    by the Department by rule, that it has received an
7    exemption under Section 501(c)(3) of the Internal Revenue
8    Code and that is organized and operated primarily for the
9    presentation or support of arts or cultural programming,
10    activities, or services. These organizations include, but
11    are not limited to, music and dramatic arts organizations
12    such as symphony orchestras and theatrical groups, arts and
13    cultural service organizations, local arts councils,
14    visual arts organizations, and media arts organizations.
15    On and after July 1, 2001 (the effective date of Public Act
16    92-35), however, an entity otherwise eligible for this
17    exemption shall not make tax-free purchases unless it has
18    an active identification number issued by the Department.
19        (10) Personal property sold by a corporation, society,
20    association, foundation, institution, or organization,
21    other than a limited liability company, that is organized
22    and operated as a not-for-profit service enterprise for the
23    benefit of persons 65 years of age or older if the personal
24    property was not purchased by the enterprise for the
25    purpose of resale by the enterprise.
26        (11) Personal property sold to a governmental body, to

 

 

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1    a corporation, society, association, foundation, or
2    institution organized and operated exclusively for
3    charitable, religious, or educational purposes, or to a
4    not-for-profit corporation, society, association,
5    foundation, institution, or organization that has no
6    compensated officers or employees and that is organized and
7    operated primarily for the recreation of persons 55 years
8    of age or older. A limited liability company may qualify
9    for the exemption under this paragraph only if the limited
10    liability company is organized and operated exclusively
11    for educational purposes. On and after July 1, 1987,
12    however, no entity otherwise eligible for this exemption
13    shall make tax-free purchases unless it has an active
14    identification number issued by the Department.
15        (12) (Blank).
16        (12-5) On and after July 1, 2003 and through June 30,
17    2004, motor vehicles of the second division with a gross
18    vehicle weight in excess of 8,000 pounds that are subject
19    to the commercial distribution fee imposed under Section
20    3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
21    2004 and through June 30, 2005, the use in this State of
22    motor vehicles of the second division: (i) with a gross
23    vehicle weight rating in excess of 8,000 pounds; (ii) that
24    are subject to the commercial distribution fee imposed
25    under Section 3-815.1 of the Illinois Vehicle Code; and
26    (iii) that are primarily used for commercial purposes.

 

 

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1    Through June 30, 2005, this exemption applies to repair and
2    replacement parts added after the initial purchase of such
3    a motor vehicle if that motor vehicle is used in a manner
4    that would qualify for the rolling stock exemption
5    otherwise provided for in this Act. For purposes of this
6    paragraph, "used for commercial purposes" means the
7    transportation of persons or property in furtherance of any
8    commercial or industrial enterprise whether for-hire or
9    not.
10        (13) Proceeds from sales to owners, lessors, or
11    shippers of tangible personal property that is utilized by
12    interstate carriers for hire for use as rolling stock
13    moving in interstate commerce and equipment operated by a
14    telecommunications provider, licensed as a common carrier
15    by the Federal Communications Commission, which is
16    permanently installed in or affixed to aircraft moving in
17    interstate commerce.
18        (14) Machinery and equipment that will be used by the
19    purchaser, or a lessee of the purchaser, primarily in the
20    process of manufacturing or assembling tangible personal
21    property for wholesale or retail sale or lease, whether the
22    sale or lease is made directly by the manufacturer or by
23    some other person, whether the materials used in the
24    process are owned by the manufacturer or some other person,
25    or whether the sale or lease is made apart from or as an
26    incident to the seller's engaging in the service occupation

 

 

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1    of producing machines, tools, dies, jigs, patterns,
2    gauges, or other similar items of no commercial value on
3    special order for a particular purchaser. The exemption
4    provided by this paragraph (14) does not include machinery
5    and equipment used in (i) the generation of electricity for
6    wholesale or retail sale; (ii) the generation or treatment
7    of natural or artificial gas for wholesale or retail sale
8    that is delivered to customers through pipes, pipelines, or
9    mains; or (iii) the treatment of water for wholesale or
10    retail sale that is delivered to customers through pipes,
11    pipelines, or mains. The provisions of Public Act 98-583
12    are declaratory of existing law as to the meaning and scope
13    of this exemption. Beginning on July 1, 2017, the exemption
14    provided by this paragraph (14) includes, but is not
15    limited to, graphic arts machinery and equipment, as
16    defined in paragraph (4) of this Section.
17        (15) Proceeds of mandatory service charges separately
18    stated on customers' bills for purchase and consumption of
19    food and beverages, to the extent that the proceeds of the
20    service charge are in fact turned over as tips or as a
21    substitute for tips to the employees who participate
22    directly in preparing, serving, hosting or cleaning up the
23    food or beverage function with respect to which the service
24    charge is imposed.
25        (16) Tangible personal property sold to a purchaser if
26    the purchaser is exempt from use tax by operation of

 

 

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1    federal law. This paragraph is exempt from the provisions
2    of Section 2-70.
3        (17) Tangible personal property sold to a common
4    carrier by rail or motor that receives the physical
5    possession of the property in Illinois and that transports
6    the property, or shares with another common carrier in the
7    transportation of the property, out of Illinois on a
8    standard uniform bill of lading showing the seller of the
9    property as the shipper or consignor of the property to a
10    destination outside Illinois, for use outside Illinois.
11        (18) Legal tender, currency, medallions, or gold or
12    silver coinage issued by the State of Illinois, the
13    government of the United States of America, or the
14    government of any foreign country, and bullion.
15        (19) Until July 1, 2003, oil field exploration,
16    drilling, and production equipment, including (i) rigs and
17    parts of rigs, rotary rigs, cable tool rigs, and workover
18    rigs, (ii) pipe and tubular goods, including casing and
19    drill strings, (iii) pumps and pump-jack units, (iv)
20    storage tanks and flow lines, (v) any individual
21    replacement part for oil field exploration, drilling, and
22    production equipment, and (vi) machinery and equipment
23    purchased for lease; but excluding motor vehicles required
24    to be registered under the Illinois Vehicle Code.
25        (20) Photoprocessing machinery and equipment,
26    including repair and replacement parts, both new and used,

 

 

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1    including that manufactured on special order, certified by
2    the purchaser to be used primarily for photoprocessing, and
3    including photoprocessing machinery and equipment
4    purchased for lease.
5        (21) Until July 1, 2023, coal and aggregate
6    exploration, mining, off-highway hauling, processing,
7    maintenance, and reclamation equipment, including
8    replacement parts and equipment, and including equipment
9    purchased for lease, but excluding motor vehicles required
10    to be registered under the Illinois Vehicle Code. The
11    changes made to this Section by Public Act 97-767 apply on
12    and after July 1, 2003, but no claim for credit or refund
13    is allowed on or after August 16, 2013 (the effective date
14    of Public Act 98-456) for such taxes paid during the period
15    beginning July 1, 2003 and ending on August 16, 2013 (the
16    effective date of Public Act 98-456).
17        (22) Until June 30, 2013, fuel and petroleum products
18    sold to or used by an air carrier, certified by the carrier
19    to be used for consumption, shipment, or storage in the
20    conduct of its business as an air common carrier, for a
21    flight destined for or returning from a location or
22    locations outside the United States without regard to
23    previous or subsequent domestic stopovers.
24        Beginning July 1, 2013, fuel and petroleum products
25    sold to or used by an air carrier, certified by the carrier
26    to be used for consumption, shipment, or storage in the

 

 

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1    conduct of its business as an air common carrier, for a
2    flight that (i) is engaged in foreign trade or is engaged
3    in trade between the United States and any of its
4    possessions and (ii) transports at least one individual or
5    package for hire from the city of origination to the city
6    of final destination on the same aircraft, without regard
7    to a change in the flight number of that aircraft.
8        (23) A transaction in which the purchase order is
9    received by a florist who is located outside Illinois, but
10    who has a florist located in Illinois deliver the property
11    to the purchaser or the purchaser's donee in Illinois.
12        (24) Fuel consumed or used in the operation of ships,
13    barges, or vessels that are used primarily in or for the
14    transportation of property or the conveyance of persons for
15    hire on rivers bordering on this State if the fuel is
16    delivered by the seller to the purchaser's barge, ship, or
17    vessel while it is afloat upon that bordering river.
18        (25) Except as provided in item (25-5) of this Section,
19    a motor vehicle sold in this State to a nonresident even
20    though the motor vehicle is delivered to the nonresident in
21    this State, if the motor vehicle is not to be titled in
22    this State, and if a drive-away permit is issued to the
23    motor vehicle as provided in Section 3-603 of the Illinois
24    Vehicle Code or if the nonresident purchaser has vehicle
25    registration plates to transfer to the motor vehicle upon
26    returning to his or her home state. The issuance of the

 

 

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1    drive-away permit or having the out-of-state registration
2    plates to be transferred is prima facie evidence that the
3    motor vehicle will not be titled in this State.
4        (25-5) The exemption under item (25) does not apply if
5    the state in which the motor vehicle will be titled does
6    not allow a reciprocal exemption for a motor vehicle sold
7    and delivered in that state to an Illinois resident but
8    titled in Illinois. The tax collected under this Act on the
9    sale of a motor vehicle in this State to a resident of
10    another state that does not allow a reciprocal exemption
11    shall be imposed at a rate equal to the state's rate of tax
12    on taxable property in the state in which the purchaser is
13    a resident, except that the tax shall not exceed the tax
14    that would otherwise be imposed under this Act. At the time
15    of the sale, the purchaser shall execute a statement,
16    signed under penalty of perjury, of his or her intent to
17    title the vehicle in the state in which the purchaser is a
18    resident within 30 days after the sale and of the fact of
19    the payment to the State of Illinois of tax in an amount
20    equivalent to the state's rate of tax on taxable property
21    in his or her state of residence and shall submit the
22    statement to the appropriate tax collection agency in his
23    or her state of residence. In addition, the retailer must
24    retain a signed copy of the statement in his or her
25    records. Nothing in this item shall be construed to require
26    the removal of the vehicle from this state following the

 

 

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1    filing of an intent to title the vehicle in the purchaser's
2    state of residence if the purchaser titles the vehicle in
3    his or her state of residence within 30 days after the date
4    of sale. The tax collected under this Act in accordance
5    with this item (25-5) shall be proportionately distributed
6    as if the tax were collected at the 6.25% general rate
7    imposed under this Act.
8        (25-7) Beginning on July 1, 2007, no tax is imposed
9    under this Act on the sale of an aircraft, as defined in
10    Section 3 of the Illinois Aeronautics Act, if all of the
11    following conditions are met:
12            (1) the aircraft leaves this State within 15 days
13        after the later of either the issuance of the final
14        billing for the sale of the aircraft, or the authorized
15        approval for return to service, completion of the
16        maintenance record entry, and completion of the test
17        flight and ground test for inspection, as required by
18        14 C.F.R. 91.407;
19            (2) the aircraft is not based or registered in this
20        State after the sale of the aircraft; and
21            (3) the seller retains in his or her books and
22        records and provides to the Department a signed and
23        dated certification from the purchaser, on a form
24        prescribed by the Department, certifying that the
25        requirements of this item (25-7) are met. The
26        certificate must also include the name and address of

 

 

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1        the purchaser, the address of the location where the
2        aircraft is to be titled or registered, the address of
3        the primary physical location of the aircraft, and
4        other information that the Department may reasonably
5        require.
6        For purposes of this item (25-7):
7        "Based in this State" means hangared, stored, or
8    otherwise used, excluding post-sale customizations as
9    defined in this Section, for 10 or more days in each
10    12-month period immediately following the date of the sale
11    of the aircraft.
12        "Registered in this State" means an aircraft
13    registered with the Department of Transportation,
14    Aeronautics Division, or titled or registered with the
15    Federal Aviation Administration to an address located in
16    this State.
17        This paragraph (25-7) is exempt from the provisions of
18    Section 2-70.
19        (26) Semen used for artificial insemination of
20    livestock for direct agricultural production.
21        (27) Horses, or interests in horses, registered with
22    and meeting the requirements of any of the Arabian Horse
23    Club Registry of America, Appaloosa Horse Club, American
24    Quarter Horse Association, United States Trotting
25    Association, or Jockey Club, as appropriate, used for
26    purposes of breeding or racing for prizes. This item (27)

 

 

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1    is exempt from the provisions of Section 2-70, and the
2    exemption provided for under this item (27) applies for all
3    periods beginning May 30, 1995, but no claim for credit or
4    refund is allowed on or after January 1, 2008 (the
5    effective date of Public Act 95-88) for such taxes paid
6    during the period beginning May 30, 2000 and ending on
7    January 1, 2008 (the effective date of Public Act 95-88).
8        (28) Computers and communications equipment utilized
9    for any hospital purpose and equipment used in the
10    diagnosis, analysis, or treatment of hospital patients
11    sold to a lessor who leases the equipment, under a lease of
12    one year or longer executed or in effect at the time of the
13    purchase, to a hospital that has been issued an active tax
14    exemption identification number by the Department under
15    Section 1g of this Act.
16        (29) Personal property sold to a lessor who leases the
17    property, under a lease of one year or longer executed or
18    in effect at the time of the purchase, to a governmental
19    body that has been issued an active tax exemption
20    identification number by the Department under Section 1g of
21    this Act.
22        (30) Beginning with taxable years ending on or after
23    December 31, 1995 and ending with taxable years ending on
24    or before December 31, 2004, personal property that is
25    donated for disaster relief to be used in a State or
26    federally declared disaster area in Illinois or bordering

 

 

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1    Illinois by a manufacturer or retailer that is registered
2    in this State to a corporation, society, association,
3    foundation, or institution that has been issued a sales tax
4    exemption identification number by the Department that
5    assists victims of the disaster who reside within the
6    declared disaster area.
7        (31) Beginning with taxable years ending on or after
8    December 31, 1995 and ending with taxable years ending on
9    or before December 31, 2004, personal property that is used
10    in the performance of infrastructure repairs in this State,
11    including but not limited to municipal roads and streets,
12    access roads, bridges, sidewalks, waste disposal systems,
13    water and sewer line extensions, water distribution and
14    purification facilities, storm water drainage and
15    retention facilities, and sewage treatment facilities,
16    resulting from a State or federally declared disaster in
17    Illinois or bordering Illinois when such repairs are
18    initiated on facilities located in the declared disaster
19    area within 6 months after the disaster.
20        (32) Beginning July 1, 1999, game or game birds sold at
21    a "game breeding and hunting preserve area" as that term is
22    used in the Wildlife Code. This paragraph is exempt from
23    the provisions of Section 2-70.
24        (33) A motor vehicle, as that term is defined in
25    Section 1-146 of the Illinois Vehicle Code, that is donated
26    to a corporation, limited liability company, society,

 

 

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1    association, foundation, or institution that is determined
2    by the Department to be organized and operated exclusively
3    for educational purposes. For purposes of this exemption,
4    "a corporation, limited liability company, society,
5    association, foundation, or institution organized and
6    operated exclusively for educational purposes" means all
7    tax-supported public schools, private schools that offer
8    systematic instruction in useful branches of learning by
9    methods common to public schools and that compare favorably
10    in their scope and intensity with the course of study
11    presented in tax-supported schools, and vocational or
12    technical schools or institutes organized and operated
13    exclusively to provide a course of study of not less than 6
14    weeks duration and designed to prepare individuals to
15    follow a trade or to pursue a manual, technical,
16    mechanical, industrial, business, or commercial
17    occupation.
18        (34) Beginning January 1, 2000, personal property,
19    including food, purchased through fundraising events for
20    the benefit of a public or private elementary or secondary
21    school, a group of those schools, or one or more school
22    districts if the events are sponsored by an entity
23    recognized by the school district that consists primarily
24    of volunteers and includes parents and teachers of the
25    school children. This paragraph does not apply to
26    fundraising events (i) for the benefit of private home

 

 

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1    instruction or (ii) for which the fundraising entity
2    purchases the personal property sold at the events from
3    another individual or entity that sold the property for the
4    purpose of resale by the fundraising entity and that
5    profits from the sale to the fundraising entity. This
6    paragraph is exempt from the provisions of Section 2-70.
7        (35) Beginning January 1, 2000 and through December 31,
8    2001, new or used automatic vending machines that prepare
9    and serve hot food and beverages, including coffee, soup,
10    and other items, and replacement parts for these machines.
11    Beginning January 1, 2002 and through June 30, 2003,
12    machines and parts for machines used in commercial,
13    coin-operated amusement and vending business if a use or
14    occupation tax is paid on the gross receipts derived from
15    the use of the commercial, coin-operated amusement and
16    vending machines. This paragraph is exempt from the
17    provisions of Section 2-70.
18        (35-5) Beginning August 23, 2001 and through June 30,
19    2016, food for human consumption that is to be consumed off
20    the premises where it is sold (other than alcoholic
21    beverages, soft drinks, and food that has been prepared for
22    immediate consumption) and prescription and
23    nonprescription medicines, drugs, medical appliances, and
24    insulin, urine testing materials, syringes, and needles
25    used by diabetics, for human use, when purchased for use by
26    a person receiving medical assistance under Article V of

 

 

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1    the Illinois Public Aid Code who resides in a licensed
2    long-term care facility, as defined in the Nursing Home
3    Care Act, or a licensed facility as defined in the ID/DD
4    Community Care Act, the MC/DD Act, or the Specialized
5    Mental Health Rehabilitation Act of 2013.
6        (36) Beginning August 2, 2001, computers and
7    communications equipment utilized for any hospital purpose
8    and equipment used in the diagnosis, analysis, or treatment
9    of hospital patients sold to a lessor who leases the
10    equipment, under a lease of one year or longer executed or
11    in effect at the time of the purchase, to a hospital that
12    has been issued an active tax exemption identification
13    number by the Department under Section 1g of this Act. This
14    paragraph is exempt from the provisions of Section 2-70.
15        (37) Beginning August 2, 2001, personal property sold
16    to a lessor who leases the property, under a lease of one
17    year or longer executed or in effect at the time of the
18    purchase, to a governmental body that has been issued an
19    active tax exemption identification number by the
20    Department under Section 1g of this Act. This paragraph is
21    exempt from the provisions of Section 2-70.
22        (38) Beginning on January 1, 2002 and through June 30,
23    2016, tangible personal property purchased from an
24    Illinois retailer by a taxpayer engaged in centralized
25    purchasing activities in Illinois who will, upon receipt of
26    the property in Illinois, temporarily store the property in

 

 

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1    Illinois (i) for the purpose of subsequently transporting
2    it outside this State for use or consumption thereafter
3    solely outside this State or (ii) for the purpose of being
4    processed, fabricated, or manufactured into, attached to,
5    or incorporated into other tangible personal property to be
6    transported outside this State and thereafter used or
7    consumed solely outside this State. The Director of Revenue
8    shall, pursuant to rules adopted in accordance with the
9    Illinois Administrative Procedure Act, issue a permit to
10    any taxpayer in good standing with the Department who is
11    eligible for the exemption under this paragraph (38). The
12    permit issued under this paragraph (38) shall authorize the
13    holder, to the extent and in the manner specified in the
14    rules adopted under this Act, to purchase tangible personal
15    property from a retailer exempt from the taxes imposed by
16    this Act. Taxpayers shall maintain all necessary books and
17    records to substantiate the use and consumption of all such
18    tangible personal property outside of the State of
19    Illinois.
20        (39) Beginning January 1, 2008, tangible personal
21    property used in the construction or maintenance of a
22    community water supply, as defined under Section 3.145 of
23    the Environmental Protection Act, that is operated by a
24    not-for-profit corporation that holds a valid water supply
25    permit issued under Title IV of the Environmental
26    Protection Act. This paragraph is exempt from the

 

 

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1    provisions of Section 2-70.
2        (40) Beginning January 1, 2010, materials, parts,
3    equipment, components, and furnishings incorporated into
4    or upon an aircraft as part of the modification,
5    refurbishment, completion, replacement, repair, or
6    maintenance of the aircraft. This exemption includes
7    consumable supplies used in the modification,
8    refurbishment, completion, replacement, repair, and
9    maintenance of aircraft, but excludes any materials,
10    parts, equipment, components, and consumable supplies used
11    in the modification, replacement, repair, and maintenance
12    of aircraft engines or power plants, whether such engines
13    or power plants are installed or uninstalled upon any such
14    aircraft. "Consumable supplies" include, but are not
15    limited to, adhesive, tape, sandpaper, general purpose
16    lubricants, cleaning solution, latex gloves, and
17    protective films. This exemption applies only to the sale
18    of qualifying tangible personal property to persons who
19    modify, refurbish, complete, replace, or maintain an
20    aircraft and who (i) hold an Air Agency Certificate and are
21    empowered to operate an approved repair station by the
22    Federal Aviation Administration, (ii) have a Class IV
23    Rating, and (iii) conduct operations in accordance with
24    Part 145 of the Federal Aviation Regulations. The exemption
25    does not include aircraft operated by a commercial air
26    carrier providing scheduled passenger air service pursuant

 

 

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1    to authority issued under Part 121 or Part 129 of the
2    Federal Aviation Regulations. The changes made to this
3    paragraph (40) by Public Act 98-534 are declarative of
4    existing law.
5        (41) Tangible personal property sold to a
6    public-facilities corporation, as described in Section
7    11-65-10 of the Illinois Municipal Code, for purposes of
8    constructing or furnishing a municipal convention hall,
9    but only if the legal title to the municipal convention
10    hall is transferred to the municipality without any further
11    consideration by or on behalf of the municipality at the
12    time of the completion of the municipal convention hall or
13    upon the retirement or redemption of any bonds or other
14    debt instruments issued by the public-facilities
15    corporation in connection with the development of the
16    municipal convention hall. This exemption includes
17    existing public-facilities corporations as provided in
18    Section 11-65-25 of the Illinois Municipal Code. This
19    paragraph is exempt from the provisions of Section 2-70.
20        (42) Beginning January 1, 2017, menstrual pads,
21    tampons, and menstrual cups.
22        (43) Merchandise that is subject to the Rental Purchase
23    Agreement Occupation and Use Tax. The purchaser must
24    certify that the item is purchased to be rented subject to
25    a rental purchase agreement, as defined in the Rental
26    Purchase Agreement Act, and provide proof of registration

 

 

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1    under the Rental Purchase Agreement Occupation and Use Tax
2    Act. This paragraph is exempt from the provisions of
3    Section 2-70.
4        (44) Products purchased by an eligible apiarist for use
5    in producing honey bee products for sale or for providing
6    bee pollination services. As used in this paragraph,
7    "eligible apiarist" means a person who owns or keeps one or
8    more bee colonies and who grows, raises, or produces honey
9    bee products for sale at wholesale. As used in this
10    paragraph, "honey bee products" means queen honey bees,
11    packaged honey bees, honey, pollen, bees wax, propolis, or
12    other substances obtained from honey bees, but does not
13    include manufactured substances or articles. This
14    paragraph is exempt from the provisions of Section 2-70.
15(Source: P.A. 99-180, eff. 7-29-15; 99-855, eff. 8-19-16;
16100-22, eff. 7-6-17; 100-321, eff. 8-24-17; 100-437, eff.
171-1-18; 100-594, eff. 6-29-18; 100-863, eff. 8-14-18;
18100-1171, eff. 1-4-19; revised 1-8-19.)