101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3296

 

Introduced 2/11/2020, by Sen. Ram Villivalam

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-5
35 ILCS 105/3-10
35 ILCS 110/3-5
35 ILCS 110/3-10  from Ch. 120, par. 439.33-10
35 ILCS 115/3-5
35 ILCS 115/3-10  from Ch. 120, par. 439.103-10
35 ILCS 120/2-5
35 ILCS 120/2-10

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that prescription medicines and medical devices are exempt from the taxes under those Acts. Effective July 1, 2020.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB3296LRB101 19659 HLH 69147 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 Sections
53-5 and 3-10 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) includes production related tangible personal
25property, as defined in Section 3-50, purchased on or after
26July 1, 2019. The exemption provided by this paragraph (18)

 

 

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1does not include machinery and equipment used in (i) the
2generation of electricity for wholesale or retail sale; (ii)
3the generation or treatment of natural or artificial gas for
4wholesale or retail sale that is delivered to customers through
5pipes, pipelines, or mains; or (iii) the treatment of water for
6wholesale or retail sale that is delivered to customers through
7pipes, pipelines, or mains. The provisions of Public Act 98-583
8are declaratory of existing law as to the meaning and scope of
9this exemption. Beginning on July 1, 2017, the exemption
10provided by this paragraph (18) includes, but is not limited
11to, graphic arts machinery and equipment, as defined in
12paragraph (6) of this Section.
13    (19) Personal property delivered to a purchaser or
14purchaser's donee inside Illinois when the purchase order for
15that personal property was received by a florist located
16outside Illinois who has a florist located inside Illinois
17deliver the personal property.
18    (20) Semen used for artificial insemination of livestock
19for direct agricultural production.
20    (21) Horses, or interests in horses, registered with and
21meeting the requirements of any of the Arabian Horse Club
22Registry of America, Appaloosa Horse Club, American Quarter
23Horse Association, United States Trotting Association, or
24Jockey Club, as appropriate, used for purposes of breeding or
25racing for prizes. This item (21) is exempt from the provisions
26of Section 3-90, and the exemption provided for under this item

 

 

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1(21) applies for all periods beginning May 30, 1995, but no
2claim for credit or refund is allowed on or after January 1,
32008 for such taxes paid during the period beginning May 30,
42000 and ending on January 1, 2008.
5    (22) Computers and communications equipment utilized for
6any hospital purpose and equipment used in the diagnosis,
7analysis, or treatment of hospital patients purchased by a
8lessor who leases the equipment, under a lease of one year or
9longer executed or in effect at the time the lessor would
10otherwise be subject to the tax imposed by this Act, to a
11hospital that has been issued an active tax exemption
12identification number by the Department under Section 1g of the
13Retailers' Occupation Tax Act. If the equipment is leased in a
14manner that does not qualify for this exemption or is used in
15any other non-exempt manner, the lessor shall be liable for the
16tax imposed under this Act or the Service Use Tax Act, as the
17case may be, based on the fair market value of the property at
18the time the non-qualifying use occurs. No lessor shall collect
19or attempt to collect an amount (however designated) that
20purports to reimburse that lessor for the tax imposed by this
21Act or the Service Use Tax Act, as the case may be, if the tax
22has not been paid by the lessor. If a lessor improperly
23collects any such amount from the lessee, the lessee shall have
24a legal right to claim a refund of that amount from the lessor.
25If, however, that amount is not refunded to the lessee for any
26reason, the lessor is liable to pay that amount to the

 

 

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1Department.
2    (23) 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 sales tax exemption identification number by
7the Department under Section 1g of the Retailers' Occupation
8Tax Act. If the property is leased in a manner that does not
9qualify for this exemption or used in any other non-exempt
10manner, the lessor shall be liable for the tax imposed under
11this Act or the Service Use Tax Act, as the case may be, based
12on the fair 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
16Service Use Tax Act, as the case may be, if the tax has not been
17paid by the lessor. If a lessor improperly collects any such
18amount from the lessee, the lessee shall have a legal right to
19claim a refund of that amount from the lessor. If, however,
20that amount is not refunded to the lessee for any reason, the
21lessor is liable to pay that amount to the Department.
22    (24) 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    (25) 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    (26) 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 3-90.
22    (27) 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    (28) 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 3-90.
2    (29) 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 3-90.
12    (30) Beginning January 1, 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    (31) Beginning on August 2, 2001 (the effective date of
26Public Act 92-227), computers and communications equipment

 

 

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

 

 

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1executed or in effect at the time the lessor would otherwise be
2subject to the tax imposed by this Act, to a governmental body
3that has been issued an active sales tax exemption
4identification number by the Department under Section 1g of the
5Retailers' Occupation Tax Act. If the property is leased in a
6manner that does not qualify for this exemption or used in any
7other nonexempt manner, the lessor shall be liable for the tax
8imposed under this Act or the Service Use Tax Act, as the case
9may be, based on the fair market value of the property at the
10time the nonqualifying use occurs. No lessor shall collect or
11attempt to collect an amount (however designated) that purports
12to reimburse 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. This
19paragraph is exempt from the provisions of Section 3-90.
20    (33) On and after July 1, 2003 and through June 30, 2004,
21the use in this State of motor vehicles of the second division
22with a gross vehicle weight in excess of 8,000 pounds and that
23are subject to the commercial distribution fee imposed under
24Section 3-815.1 of the Illinois Vehicle Code. Beginning on July
251, 2004 and through June 30, 2005, the use in this State of
26motor vehicles of the second division: (i) with a gross vehicle

 

 

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1weight rating in excess of 8,000 pounds; (ii) that are subject
2to the commercial distribution fee imposed under Section
33-815.1 of the Illinois Vehicle Code; and (iii) that are
4primarily used for commercial purposes. Through June 30, 2005,
5this exemption applies to repair and replacement parts added
6after the initial purchase of such a motor vehicle if that
7motor vehicle is used in a manner that would qualify for the
8rolling stock exemption otherwise provided for in this Act. For
9purposes of this paragraph, the term "used for commercial
10purposes" means the transportation of persons or property in
11furtherance of any commercial or industrial enterprise,
12whether for-hire or not.
13    (34) Beginning January 1, 2008, tangible personal property
14used in the construction or maintenance of a community water
15supply, as defined under Section 3.145 of the Environmental
16Protection Act, that is operated by a not-for-profit
17corporation that holds a valid water supply permit issued under
18Title IV of the Environmental Protection Act. This paragraph is
19exempt from the provisions of Section 3-90.
20    (35) Beginning January 1, 2010, materials, parts,
21equipment, components, and furnishings incorporated into or
22upon an aircraft as part of the modification, refurbishment,
23completion, replacement, repair, or maintenance of the
24aircraft. This exemption includes consumable supplies used in
25the modification, refurbishment, completion, replacement,
26repair, and maintenance of aircraft, but excludes any

 

 

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1materials, parts, equipment, components, and consumable
2supplies used in the modification, replacement, repair, and
3maintenance of aircraft engines or power plants, whether such
4engines or power plants are installed or uninstalled upon any
5such aircraft. "Consumable supplies" include, but are not
6limited to, adhesive, tape, sandpaper, general purpose
7lubricants, cleaning solution, latex gloves, and protective
8films. This exemption applies only to the use of qualifying
9tangible personal property by persons who modify, refurbish,
10complete, repair, replace, or maintain aircraft and who (i)
11hold an Air Agency Certificate and are empowered to operate an
12approved repair station by the Federal Aviation
13Administration, (ii) have a Class IV Rating, and (iii) conduct
14operations in accordance with Part 145 of the Federal Aviation
15Regulations. The exemption does not include aircraft operated
16by a commercial air carrier providing scheduled passenger air
17service pursuant to authority issued under Part 121 or Part 129
18of the Federal Aviation Regulations. The changes made to this
19paragraph (35) by Public Act 98-534 are declarative of existing
20law.
21    (36) Tangible personal property purchased by 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 3-90.
9    (37) Beginning January 1, 2017, menstrual pads, tampons,
10and menstrual cups.
11    (38) Merchandise that is subject to the Rental Purchase
12Agreement Occupation and Use Tax. The purchaser must certify
13that the item is purchased to be rented subject to a rental
14purchase agreement, as defined in the Rental Purchase Agreement
15Act, and provide proof of registration under the Rental
16Purchase Agreement Occupation and Use Tax Act. This paragraph
17is exempt from the provisions of Section 3-90.
18    (39) Tangible personal property purchased by a purchaser
19who is exempt from the tax imposed by this Act by operation of
20federal law. This paragraph is exempt from the provisions of
21Section 3-90.
22    (40) Qualified tangible personal property used in the
23construction or operation of a data center that has been
24granted a certificate of exemption by the Department of
25Commerce and Economic Opportunity, whether that tangible
26personal property is purchased by the owner, operator, or

 

 

SB3296- 19 -LRB101 19659 HLH 69147 b

1tenant of the data center or by a contractor or subcontractor
2of the owner, operator, or tenant. Data centers that would have
3qualified for a certificate of exemption prior to January 1,
42020 had Public Act 101-31 this amendatory Act of the 101st
5General Assembly been in effect, may apply for and obtain an
6exemption for subsequent purchases of computer equipment or
7enabling software purchased or leased to upgrade, supplement,
8or replace computer equipment or enabling software purchased or
9leased in the original investment that would have qualified.
10    The Department of Commerce and Economic Opportunity shall
11grant a certificate of exemption under this item (40) to
12qualified data centers as defined by Section 605-1025 of the
13Department of Commerce and Economic Opportunity Law of the
14Civil Administrative Code of Illinois.
15    For the purposes of this item (40):
16        "Data center" means a building or a series of buildings
17    rehabilitated or constructed to house working servers in
18    one physical location or multiple sites within the State of
19    Illinois.
20        "Qualified tangible personal property" means:
21    electrical systems and equipment; climate control and
22    chilling equipment and systems; mechanical systems and
23    equipment; monitoring and secure systems; emergency
24    generators; hardware; computers; servers; data storage
25    devices; network connectivity equipment; racks; cabinets;
26    telecommunications cabling infrastructure; raised floor

 

 

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1    systems; peripheral components or systems; software;
2    mechanical, electrical, or plumbing systems; battery
3    systems; cooling systems and towers; temperature control
4    systems; other cabling; and other data center
5    infrastructure equipment and systems necessary to operate
6    qualified tangible personal property, including fixtures;
7    and component parts of any of the foregoing, including
8    installation, maintenance, repair, refurbishment, and
9    replacement of qualified tangible personal property to
10    generate, transform, transmit, distribute, or manage
11    electricity necessary to operate qualified tangible
12    personal property; and all other tangible personal
13    property that is essential to the operations of a computer
14    data center. The term "qualified tangible personal
15    property" also includes building materials physically
16    incorporated in to the qualifying data center. To document
17    the exemption allowed under this Section, the retailer must
18    obtain from the purchaser a copy of the certificate of
19    eligibility issued by the Department of Commerce and
20    Economic Opportunity.
21    This item (40) is exempt from the provisions of Section
223-90.
23    (41) Beginning July 1, 2020, prescription medicines and
24medical devices (including, but not limited to, products
25classified as Class III medical devices by the United States
26Food and Drug Administration that are used for cancer treatment

 

 

SB3296- 21 -LRB101 19659 HLH 69147 b

1pursuant to a prescription, as well as any accessories and
2components related to those devices). This item (41) is exempt
3from the provisions of Section 3-90.
4(Source: P.A. 100-22, eff. 7-6-17; 100-437, eff. 1-1-18;
5100-594, eff. 6-29-18; 100-863, eff. 8-14-18; 100-1171, eff.
61-4-19; 101-9, eff. 6-5-19; 101-31, eff. 6-28-19; 101-81, eff.
77-12-19; revised 9-23-19.)
 
8    (35 ILCS 105/3-10)
9    Sec. 3-10. Rate of tax. Unless otherwise provided in this
10Section, the tax imposed by this Act is at the rate of 6.25% of
11either the selling price or the fair market value, if any, of
12the tangible personal property. In all cases where property
13functionally used or consumed is the same as the property that
14was purchased at retail, then the tax is imposed on the selling
15price of the property. In all cases where property functionally
16used or consumed is a by-product or waste product that has been
17refined, manufactured, or produced from property purchased at
18retail, then the tax is imposed on the lower of the fair market
19value, if any, of the specific property so used in this State
20or on the selling price of the property purchased at retail.
21For purposes of this Section "fair market value" means the
22price at which property would change hands between a willing
23buyer and a willing seller, neither being under any compulsion
24to buy or sell and both having reasonable knowledge of the
25relevant facts. The fair market value shall be established by

 

 

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1Illinois sales by the taxpayer of the same property as that
2functionally used or consumed, or if there are no such sales by
3the taxpayer, then comparable sales or purchases of property of
4like kind and character in Illinois.
5    Beginning on July 1, 2000 and through December 31, 2000,
6with respect to motor fuel, as defined in Section 1.1 of the
7Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
8the Use Tax Act, the tax is imposed at the rate of 1.25%.
9    Beginning on August 6, 2010 through August 15, 2010, with
10respect to sales tax holiday items as defined in Section 3-6 of
11this Act, the tax is imposed at the rate of 1.25%.
12    With respect to gasohol, the tax imposed by this Act
13applies to (i) 70% of the proceeds of sales made on or after
14January 1, 1990, and before July 1, 2003, (ii) 80% of the
15proceeds of sales made on or after July 1, 2003 and on or
16before July 1, 2017, and (iii) 100% of the proceeds of sales
17made thereafter. If, at any time, however, the tax under this
18Act on sales of gasohol is imposed at the rate of 1.25%, then
19the tax imposed by this Act applies to 100% of the proceeds of
20sales of gasohol made during that time.
21    With respect to majority blended ethanol fuel, the tax
22imposed by this Act does not apply to the proceeds of sales
23made on or after July 1, 2003 and on or before December 31,
242023 but applies to 100% of the proceeds of sales made
25thereafter.
26    With respect to biodiesel blends with no less than 1% and

 

 

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1no more than 10% biodiesel, the tax imposed by this Act applies
2to (i) 80% of the proceeds of sales made on or after July 1,
32003 and on or before December 31, 2018 and (ii) 100% of the
4proceeds of sales made thereafter. If, at any time, however,
5the tax under this Act on sales of biodiesel blends with no
6less than 1% and no more than 10% biodiesel is imposed at the
7rate of 1.25%, then the tax imposed by this Act applies to 100%
8of the proceeds of sales of biodiesel blends with no less than
91% and no more than 10% biodiesel made during that time.
10    With respect to 100% biodiesel and biodiesel blends with
11more than 10% but no more than 99% biodiesel, the tax imposed
12by this Act does not apply to the proceeds of sales made on or
13after July 1, 2003 and on or before December 31, 2023 but
14applies to 100% of the proceeds of sales made thereafter.
15    With respect to food for human consumption that is to be
16consumed off the premises where it is sold (other than
17alcoholic beverages, food consisting of or infused with adult
18use cannabis, soft drinks, and food that has been prepared for
19immediate consumption) and prescription and nonprescription
20medicines and , drugs, medical appliances that are not exempt
21under item (41) of Section 3-5, products classified as Class
22III medical devices by the United States Food and Drug
23Administration that are used for cancer treatment pursuant to a
24prescription, as well as any accessories and components related
25to those devices, modifications to a motor vehicle for the
26purpose of rendering it usable by a person with a disability,

 

 

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1and insulin, urine testing materials, syringes, and needles
2used by diabetics, for human use, the tax is imposed at the
3rate of 1%. For the purposes of this Section, until September
41, 2009: the term "soft drinks" means any complete, finished,
5ready-to-use, non-alcoholic drink, whether carbonated or not,
6including but not limited to soda water, cola, fruit juice,
7vegetable juice, carbonated water, and all other preparations
8commonly known as soft drinks of whatever kind or description
9that are contained in any closed or sealed bottle, can, carton,
10or container, regardless of size; but "soft drinks" does not
11include coffee, tea, non-carbonated water, infant formula,
12milk or milk products as defined in the Grade A Pasteurized
13Milk and Milk Products Act, or drinks containing 50% or more
14natural fruit or vegetable juice.
15    Notwithstanding any other provisions of this Act,
16beginning September 1, 2009, "soft drinks" means non-alcoholic
17beverages that contain natural or artificial sweeteners. "Soft
18drinks" do not include beverages that contain milk or milk
19products, soy, rice or similar milk substitutes, or greater
20than 50% of vegetable or fruit juice by volume.
21    Until August 1, 2009, and notwithstanding any other
22provisions of this Act, "food for human consumption that is to
23be consumed off the premises where it is sold" includes all
24food sold through a vending machine, except soft drinks and
25food products that are dispensed hot from a vending machine,
26regardless of the location of the vending machine. Beginning

 

 

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1August 1, 2009, and notwithstanding any other provisions of
2this Act, "food for human consumption that is to be consumed
3off the premises where it is sold" includes all food sold
4through a vending machine, except soft drinks, candy, and food
5products that are dispensed hot from a vending machine,
6regardless of the location of the vending machine.
7    Notwithstanding any other provisions of this Act,
8beginning September 1, 2009, "food for human consumption that
9is to be consumed off the premises where it is sold" does not
10include candy. For purposes of this Section, "candy" means a
11preparation of sugar, honey, or other natural or artificial
12sweeteners in combination with chocolate, fruits, nuts or other
13ingredients or flavorings in the form of bars, drops, or
14pieces. "Candy" does not include any preparation that contains
15flour or requires refrigeration.
16    Notwithstanding any other provisions of this Act,
17beginning September 1, 2009, "nonprescription medicines and
18drugs" does not include grooming and hygiene products. For
19purposes of this Section, "grooming and hygiene products"
20includes, but is not limited to, soaps and cleaning solutions,
21shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
22lotions and screens, unless those products are available by
23prescription only, regardless of whether the products meet the
24definition of "over-the-counter-drugs". For the purposes of
25this paragraph, "over-the-counter-drug" means a drug for human
26use that contains a label that identifies the product as a drug

 

 

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1as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
2label includes:
3        (A) A "Drug Facts" panel; or
4        (B) A statement of the "active ingredient(s)" with a
5    list of those ingredients contained in the compound,
6    substance or preparation.
7    Beginning on the effective date of this amendatory Act of
8the 98th General Assembly, "prescription and nonprescription
9medicines and drugs" includes medical cannabis purchased from a
10registered dispensing organization under the Compassionate Use
11of Medical Cannabis Program Act.
12    As used in this Section, "adult use cannabis" means
13cannabis subject to tax under the Cannabis Cultivation
14Privilege Tax Law and the Cannabis Purchaser Excise Tax Law and
15does not include cannabis subject to tax under the
16Compassionate Use of Medical Cannabis Program Act.
17    If the property that is purchased at retail from a retailer
18is acquired outside Illinois and used outside Illinois before
19being brought to Illinois for use here and is taxable under
20this Act, the "selling price" on which the tax is computed
21shall be reduced by an amount that represents a reasonable
22allowance for depreciation for the period of prior out-of-state
23use.
24(Source: P.A. 100-22, eff. 7-6-17; 101-363, eff. 8-9-19;
25101-593, eff. 12-4-19.)
 

 

 

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1    Section 10. The Service Use Tax Act is amended by changing
2Sections 3-5 and 3-10 as follows:
 
3    (35 ILCS 110/3-5)
4    Sec. 3-5. Exemptions. Use of the following tangible
5personal property is exempt from the tax imposed by this Act:
6    (1) Personal property purchased from a corporation,
7society, association, foundation, institution, or
8organization, other than a limited liability company, that is
9organized and operated as a not-for-profit service enterprise
10for the benefit of persons 65 years of age or older if the
11personal property was not purchased by the enterprise for the
12purpose of resale by the enterprise.
13    (2) Personal property purchased by a non-profit Illinois
14county fair association for use in conducting, operating, or
15promoting the county fair.
16    (3) Personal property purchased by a not-for-profit arts or
17cultural organization that establishes, by proof required by
18the Department by rule, that it has received an exemption under
19Section 501(c)(3) of the Internal Revenue Code and that is
20organized and operated primarily for the presentation or
21support of arts or cultural programming, activities, or
22services. These organizations include, but are not limited to,
23music and dramatic arts organizations such as symphony
24orchestras and theatrical groups, arts and cultural service
25organizations, local arts councils, visual arts organizations,

 

 

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1and media arts organizations. On and after July 1, 2001 (the
2effective date of Public Act 92-35), however, an entity
3otherwise eligible for this exemption shall not make tax-free
4purchases unless it has an active identification number issued
5by the Department.
6    (4) Legal tender, currency, medallions, or gold or silver
7coinage issued by the State of Illinois, the government of the
8United States of America, or the government of any foreign
9country, and bullion.
10    (5) Until July 1, 2003 and beginning again on September 1,
112004 through August 30, 2014, graphic arts machinery and
12equipment, including repair and replacement parts, both new and
13used, and including that manufactured on special order or
14purchased for lease, certified by the purchaser to be used
15primarily for graphic arts production. Equipment includes
16chemicals or chemicals acting as catalysts but only if the
17chemicals or chemicals acting as catalysts effect a direct and
18immediate change upon a graphic arts product. Beginning on July
191, 2017, graphic arts machinery and equipment is included in
20the manufacturing and assembling machinery and equipment
21exemption under Section 2 of this Act.
22    (6) Personal property purchased from a teacher-sponsored
23student organization affiliated with an elementary or
24secondary school located in Illinois.
25    (7) Farm machinery and equipment, both new and used,
26including that manufactured on special order, certified by the

 

 

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

 

 

SB3296- 30 -LRB101 19659 HLH 69147 b

1sensors, software, and related equipment used primarily in the
2computer-assisted operation of production agriculture
3facilities, equipment, and activities such as, but not limited
4to, the collection, monitoring, and correlation of animal and
5crop data for the purpose of formulating animal diets and
6agricultural chemicals. This item (7) is exempt from the
7provisions of Section 3-75.
8    (8) Until June 30, 2013, fuel and petroleum products sold
9to or used by an air common carrier, certified by the carrier
10to be used for consumption, shipment, or storage in the conduct
11of its business as an air common carrier, for a flight destined
12for or returning from a location or locations outside the
13United States without regard to previous or subsequent domestic
14stopovers.
15    Beginning July 1, 2013, fuel and petroleum products sold to
16or used by an air carrier, certified by the carrier to be used
17for consumption, shipment, or storage in the conduct of its
18business as an air common carrier, for a flight that (i) is
19engaged in foreign trade or is engaged in trade between the
20United States and any of its possessions and (ii) transports at
21least one individual or package for hire from the city of
22origination to the city of final destination on the same
23aircraft, without regard to a change in the flight number of
24that aircraft.
25    (9) Proceeds of mandatory service charges separately
26stated on customers' bills for the purchase and consumption of

 

 

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1food and beverages acquired as an incident to the purchase of a
2service from a serviceman, to the extent that the proceeds of
3the service charge are in fact turned over as tips or as a
4substitute for tips to the employees who participate directly
5in preparing, serving, hosting or cleaning up the food or
6beverage function with respect to which the service charge is
7imposed.
8    (10) 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    (11) Proceeds from the sale of photoprocessing machinery
18and equipment, including repair and replacement parts, both new
19and used, including that manufactured on special order,
20certified by the purchaser to be used primarily for
21photoprocessing, and including photoprocessing machinery and
22equipment purchased for lease.
23    (12) Until July 1, 2023, coal and aggregate exploration,
24mining, off-highway hauling, processing, maintenance, and
25reclamation equipment, including replacement parts and
26equipment, and including equipment purchased for lease, but

 

 

SB3296- 32 -LRB101 19659 HLH 69147 b

1excluding motor vehicles required to be registered under the
2Illinois Vehicle Code. The changes made to this Section by
3Public Act 97-767 apply on and after July 1, 2003, but no claim
4for credit or refund is allowed on or after August 16, 2013
5(the effective date of Public Act 98-456) for such taxes paid
6during the period beginning July 1, 2003 and ending on August
716, 2013 (the effective date of Public Act 98-456).
8    (13) Semen used for artificial insemination of livestock
9for direct agricultural production.
10    (14) Horses, or interests in horses, registered with and
11meeting the requirements of any of the Arabian Horse Club
12Registry of America, Appaloosa Horse Club, American Quarter
13Horse Association, United States Trotting Association, or
14Jockey Club, as appropriate, used for purposes of breeding or
15racing for prizes. This item (14) is exempt from the provisions
16of Section 3-75, and the exemption provided for under this item
17(14) applies for all periods beginning May 30, 1995, but no
18claim for credit or refund is allowed on or after January 1,
192008 (the effective date of Public Act 95-88) for such taxes
20paid during the period beginning May 30, 2000 and ending on
21January 1, 2008 (the effective date of Public Act 95-88).
22    (15) Computers and communications equipment utilized for
23any hospital purpose and equipment used in the diagnosis,
24analysis, or treatment of hospital patients purchased by a
25lessor who leases the equipment, under a lease of one year or
26longer executed or in effect at the time the lessor would

 

 

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

 

 

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1this Act or the Use Tax Act, as the case may be, based on the
2fair market value of the property at the time the
3non-qualifying use occurs. No lessor shall collect or attempt
4to collect an amount (however designated) that purports to
5reimburse that lessor for the tax imposed by this Act or the
6Use Tax Act, as the case may be, if the tax has not been paid by
7the lessor. If a lessor improperly collects any such amount
8from the lessee, the lessee shall have a legal right to claim a
9refund of that amount from the lessor. If, however, that amount
10is not refunded to the lessee for any reason, the lessor is
11liable to pay that amount to the Department.
12    (17) Beginning with taxable years ending on or after
13December 31, 1995 and ending with taxable years ending on or
14before December 31, 2004, personal property that is donated for
15disaster relief to be used in a State or federally declared
16disaster area in Illinois or bordering Illinois by a
17manufacturer or retailer that is registered in this State to a
18corporation, society, association, foundation, or institution
19that has been issued a sales tax exemption identification
20number by the Department that assists victims of the disaster
21who reside within the declared disaster area.
22    (18) 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 used in the
25performance of infrastructure repairs in this State, including
26but not limited to municipal roads and streets, access roads,

 

 

SB3296- 35 -LRB101 19659 HLH 69147 b

1bridges, sidewalks, waste disposal systems, water and sewer
2line extensions, water distribution and purification
3facilities, storm water drainage and retention facilities, and
4sewage treatment facilities, resulting from a State or
5federally declared disaster in Illinois or bordering Illinois
6when such repairs are initiated on facilities located in the
7declared disaster area within 6 months after the disaster.
8    (19) Beginning July 1, 1999, game or game birds purchased
9at a "game breeding and hunting preserve area" as that term is
10used in the Wildlife Code. This paragraph is exempt from the
11provisions of Section 3-75.
12    (20) A motor vehicle, as that term is defined in Section
131-146 of the Illinois Vehicle Code, that is donated to a
14corporation, limited liability company, society, association,
15foundation, or institution that is determined by the Department
16to be organized and operated exclusively for educational
17purposes. For purposes of this exemption, "a corporation,
18limited liability company, society, association, foundation,
19or institution organized and operated exclusively for
20educational purposes" means all tax-supported public schools,
21private schools that offer systematic instruction in useful
22branches of learning by methods common to public schools and
23that compare favorably in their scope and intensity with the
24course of study presented in tax-supported schools, and
25vocational or technical schools or institutes organized and
26operated exclusively to provide a course of study of not less

 

 

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1than 6 weeks duration and designed to prepare individuals to
2follow a trade or to pursue a manual, technical, mechanical,
3industrial, business, or commercial occupation.
4    (21) Beginning January 1, 2000, personal property,
5including food, purchased through fundraising events for the
6benefit of a public or private elementary or secondary school,
7a group of those schools, or one or more school districts if
8the events are sponsored by an entity recognized by the school
9district that consists primarily of volunteers and includes
10parents and teachers of the school children. This paragraph
11does not apply to fundraising events (i) for the benefit of
12private home instruction or (ii) for which the fundraising
13entity purchases the personal property sold at the events from
14another individual or entity that sold the property for the
15purpose of resale by the fundraising entity and that profits
16from the sale to the fundraising entity. This paragraph is
17exempt from the provisions of Section 3-75.
18    (22) Beginning January 1, 2000 and through December 31,
192001, new or used automatic vending machines that prepare and
20serve hot food and beverages, including coffee, soup, and other
21items, and replacement parts for these machines. Beginning
22January 1, 2002 and through June 30, 2003, machines and parts
23for machines used in commercial, coin-operated amusement and
24vending business if a use or occupation tax is paid on the
25gross receipts derived from the use of the commercial,
26coin-operated amusement and vending machines. This paragraph

 

 

SB3296- 37 -LRB101 19659 HLH 69147 b

1is exempt from the provisions of Section 3-75.
2    (23) Beginning August 23, 2001 and through June 30, 2016,
3food for human consumption that is to be consumed off the
4premises where it is sold (other than alcoholic beverages, soft
5drinks, and food that has been prepared for immediate
6consumption) and prescription and nonprescription medicines,
7drugs, medical appliances, and insulin, urine testing
8materials, syringes, and needles used by diabetics, for human
9use, when purchased for use by a person receiving medical
10assistance under Article V of the Illinois Public Aid Code who
11resides in a licensed long-term care facility, as defined in
12the Nursing Home Care Act, or in a licensed facility as defined
13in the ID/DD Community Care Act, the MC/DD Act, or the
14Specialized Mental Health Rehabilitation Act of 2013.
15    (24) Beginning on August 2, 2001 (the effective date of
16Public Act 92-227), computers and communications equipment
17utilized for any hospital purpose and equipment used in the
18diagnosis, analysis, or treatment of hospital patients
19purchased by a lessor who leases the equipment, under a lease
20of one year or longer executed or in effect at the time the
21lessor would otherwise be subject to the tax imposed by this
22Act, to a hospital that has been issued an active tax exemption
23identification number by the Department under Section 1g of the
24Retailers' Occupation Tax Act. If the equipment is leased in a
25manner that does not qualify for this exemption or is used in
26any other nonexempt manner, the lessor shall be liable for the

 

 

SB3296- 38 -LRB101 19659 HLH 69147 b

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

 

 

SB3296- 39 -LRB101 19659 HLH 69147 b

1reimburse that lessor for the tax imposed by this Act or the
2Use Tax Act, as the case may be, if the tax has not been paid by
3the lessor. If a lessor improperly collects any such amount
4from the lessee, the lessee shall have a legal right to claim a
5refund of that amount from the lessor. If, however, that amount
6is not refunded to the lessee for any reason, the lessor is
7liable to pay that amount to the Department. This paragraph is
8exempt from the provisions of Section 3-75.
9    (26) Beginning January 1, 2008, tangible personal property
10used in the construction or maintenance of a community water
11supply, as defined under Section 3.145 of the Environmental
12Protection Act, that is operated by a not-for-profit
13corporation that holds a valid water supply permit issued under
14Title IV of the Environmental Protection Act. This paragraph is
15exempt from the provisions of Section 3-75.
16    (27) Beginning January 1, 2010, materials, parts,
17equipment, components, and furnishings incorporated into or
18upon an aircraft as part of the modification, refurbishment,
19completion, replacement, repair, or maintenance of the
20aircraft. This exemption includes consumable supplies used in
21the modification, refurbishment, completion, replacement,
22repair, and maintenance of aircraft, but excludes any
23materials, parts, equipment, components, and consumable
24supplies used in the modification, replacement, repair, and
25maintenance of aircraft engines or power plants, whether such
26engines or power plants are installed or uninstalled upon any

 

 

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1such aircraft. "Consumable supplies" include, but are not
2limited to, adhesive, tape, sandpaper, general purpose
3lubricants, cleaning solution, latex gloves, and protective
4films. This exemption applies only to the use of qualifying
5tangible personal property transferred incident to the
6modification, refurbishment, completion, replacement, repair,
7or maintenance of aircraft by persons who (i) hold an Air
8Agency Certificate and are empowered to operate an approved
9repair station by the Federal Aviation Administration, (ii)
10have a Class IV Rating, and (iii) conduct operations in
11accordance with Part 145 of the Federal Aviation Regulations.
12The exemption does not include aircraft operated by a
13commercial 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 (27) by Public Act 98-534 are declarative of existing
17law.
18    (28) 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 3-75.
6    (29) Beginning January 1, 2017, menstrual pads, tampons,
7and menstrual cups.
8    (30) Tangible personal property transferred to a purchaser
9who is exempt from the tax imposed by this Act by operation of
10federal law. This paragraph is exempt from the provisions of
11Section 3-75.
12    (31) Qualified tangible personal property used in the
13construction or operation of a data center that has been
14granted a certificate of exemption by the Department of
15Commerce and Economic Opportunity, whether that tangible
16personal property is purchased by the owner, operator, or
17tenant of the data center or by a contractor or subcontractor
18of the owner, operator, or tenant. Data centers that would have
19qualified for a certificate of exemption prior to January 1,
202020 had this amendatory Act of the 101st General Assembly been
21in effect, may apply for and obtain an exemption for subsequent
22purchases of computer equipment or enabling software purchased
23or leased to upgrade, supplement, or replace computer equipment
24or enabling software purchased or leased in the original
25investment that would have qualified.
26    The Department of Commerce and Economic Opportunity shall

 

 

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1grant a certificate of exemption under this item (31) to
2qualified data centers as defined by Section 605-1025 of the
3Department of Commerce and Economic Opportunity Law of the
4Civil Administrative Code of Illinois.
5    For the purposes of this item (31):
6        "Data center" means a building or a series of buildings
7    rehabilitated or constructed to house working servers in
8    one physical location or multiple sites within the State of
9    Illinois.
10        "Qualified tangible personal property" means:
11    electrical systems and equipment; climate control and
12    chilling equipment and systems; mechanical systems and
13    equipment; monitoring and secure systems; emergency
14    generators; hardware; computers; servers; data storage
15    devices; network connectivity equipment; racks; cabinets;
16    telecommunications cabling infrastructure; raised floor
17    systems; peripheral components or systems; software;
18    mechanical, electrical, or plumbing systems; battery
19    systems; cooling systems and towers; temperature control
20    systems; other cabling; and other data center
21    infrastructure equipment and systems necessary to operate
22    qualified tangible personal property, including fixtures;
23    and component parts of any of the foregoing, including
24    installation, maintenance, repair, refurbishment, and
25    replacement of qualified tangible personal property to
26    generate, transform, transmit, distribute, or manage

 

 

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1    electricity necessary to operate qualified tangible
2    personal property; and all other tangible personal
3    property that is essential to the operations of a computer
4    data center. The term "qualified tangible personal
5    property" also includes building materials physically
6    incorporated in to the qualifying data center. To document
7    the exemption allowed under this Section, the retailer must
8    obtain from the purchaser a copy of the certificate of
9    eligibility issued by the Department of Commerce and
10    Economic Opportunity.
11    This item (31) is exempt from the provisions of Section
123-75.
13    (32) Beginning July 1, 2020, prescription medicines and
14medical devices (including, but not limited to, products
15classified as Class III medical devices by the United States
16Food and Drug Administration that are used for cancer treatment
17pursuant to a prescription, as well as any accessories and
18components related to those devices). This item (32) is exempt
19from the provisions of Section 3-75.
20(Source: P.A. 100-22, eff. 7-6-17; 100-594, eff. 6-29-18;
21100-1171, eff. 1-4-19; 101-31, eff. 6-28-19; 101-81, eff.
227-12-19.)
 
23    (35 ILCS 110/3-10)  (from Ch. 120, par. 439.33-10)
24    Sec. 3-10. Rate of tax. Unless otherwise provided in this
25Section, the tax imposed by this Act is at the rate of 6.25% of

 

 

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1the selling price of tangible personal property transferred as
2an incident to the sale of service, but, for the purpose of
3computing this tax, in no event shall the selling price be less
4than the cost price of the property to the serviceman.
5    Beginning on July 1, 2000 and through December 31, 2000,
6with respect to motor fuel, as defined in Section 1.1 of the
7Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
8the Use Tax Act, the tax is imposed at the rate of 1.25%.
9    With respect to gasohol, as defined in the Use Tax Act, the
10tax imposed by this Act applies to (i) 70% of the selling price
11of property transferred as an incident to the sale of service
12on or after January 1, 1990, and before July 1, 2003, (ii) 80%
13of the selling price of property transferred as an incident to
14the sale of service on or after July 1, 2003 and on or before
15July 1, 2017, and (iii) 100% of the selling price thereafter.
16If, at any time, however, the tax under this Act on sales of
17gasohol, as defined in the Use Tax Act, is imposed at the rate
18of 1.25%, then the tax imposed by this Act applies to 100% of
19the proceeds of sales of gasohol made during that time.
20    With respect to majority blended ethanol fuel, as defined
21in the Use Tax Act, the tax imposed by this Act does not apply
22to the selling price of property transferred as an incident to
23the sale of service on or after July 1, 2003 and on or before
24December 31, 2023 but applies to 100% of the selling price
25thereafter.
26    With respect to biodiesel blends, as defined in the Use Tax

 

 

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1Act, with no less than 1% and no more than 10% biodiesel, the
2tax imposed by this Act applies to (i) 80% of the selling price
3of property transferred as an incident to the sale of service
4on or after July 1, 2003 and on or before December 31, 2018 and
5(ii) 100% of the proceeds of the selling price thereafter. If,
6at any time, however, the tax under this Act on sales of
7biodiesel blends, as defined in the Use Tax Act, with no less
8than 1% and no more than 10% biodiesel is imposed at the rate
9of 1.25%, then the tax imposed by this Act applies to 100% of
10the proceeds of sales of biodiesel blends with no less than 1%
11and no more than 10% biodiesel made during that time.
12    With respect to 100% biodiesel, as defined in the Use Tax
13Act, and biodiesel blends, as defined in the Use Tax Act, with
14more than 10% but no more than 99% biodiesel, the tax imposed
15by this Act does not apply to the proceeds of the selling price
16of property transferred as an incident to the sale of service
17on or after July 1, 2003 and on or before December 31, 2023 but
18applies to 100% of the selling price thereafter.
19    At the election of any registered serviceman made for each
20fiscal year, sales of service in which the aggregate annual
21cost price of tangible personal property transferred as an
22incident to the sales of service is less than 35%, or 75% in
23the case of servicemen transferring prescription drugs or
24servicemen engaged in graphic arts production, of the aggregate
25annual total gross receipts from all sales of service, the tax
26imposed by this Act shall be based on the serviceman's cost

 

 

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1price of the tangible personal property transferred as an
2incident to the sale of those services.
3    The tax shall be imposed at the rate of 1% on food prepared
4for immediate consumption and transferred incident to a sale of
5service subject to this Act or the Service Occupation Tax Act
6by an entity licensed under the Hospital Licensing Act, the
7Nursing Home Care Act, the ID/DD Community Care Act, the MC/DD
8Act, the Specialized Mental Health Rehabilitation Act of 2013,
9or the Child Care Act of 1969. The tax shall also be imposed at
10the rate of 1% on food for human consumption that is to be
11consumed off the premises where it is sold (other than
12alcoholic beverages, food consisting of or infused with adult
13use cannabis, soft drinks, and food that has been prepared for
14immediate consumption and is not otherwise included in this
15paragraph) and prescription and nonprescription medicines and
16, drugs, medical appliances that are not exempt under item (32)
17of Section 3-5, products classified as Class III medical
18devices by the United States Food and Drug Administration that
19are used for cancer treatment pursuant to a prescription, as
20well as any accessories and components related to those
21devices, modifications to a motor vehicle for the purpose of
22rendering it usable by a person with a disability, and insulin,
23urine testing materials, syringes, and needles used by
24diabetics, for human use. For the purposes of this Section,
25until September 1, 2009: the term "soft drinks" means any
26complete, finished, ready-to-use, non-alcoholic drink, whether

 

 

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1carbonated or not, including but not limited to soda water,
2cola, fruit juice, vegetable juice, carbonated water, and all
3other preparations commonly known as soft drinks of whatever
4kind or description that are contained in any closed or sealed
5bottle, can, carton, or container, regardless of size; but
6"soft drinks" does not include coffee, tea, non-carbonated
7water, infant formula, milk or milk products as defined in the
8Grade A Pasteurized Milk and Milk Products Act, or drinks
9containing 50% or more natural fruit or vegetable juice.
10    Notwithstanding any other provisions of this Act,
11beginning September 1, 2009, "soft drinks" means non-alcoholic
12beverages that contain natural or artificial sweeteners. "Soft
13drinks" do not include beverages that contain milk or milk
14products, soy, rice or similar milk substitutes, or greater
15than 50% of vegetable or fruit juice by volume.
16    Until August 1, 2009, and notwithstanding any other
17provisions of this Act, "food for human consumption that is to
18be consumed off the premises where it is sold" includes all
19food sold through a vending machine, except soft drinks and
20food products that are dispensed hot from a vending machine,
21regardless of the location of the vending machine. Beginning
22August 1, 2009, and notwithstanding any other provisions of
23this Act, "food for human consumption that is to be consumed
24off the premises where it is sold" includes all food sold
25through a vending machine, except soft drinks, candy, and food
26products that are dispensed hot from a vending machine,

 

 

SB3296- 48 -LRB101 19659 HLH 69147 b

1regardless of the location of the vending machine.
2    Notwithstanding any other provisions of this Act,
3beginning September 1, 2009, "food for human consumption that
4is to be consumed off the premises where it is sold" does not
5include candy. For purposes of this Section, "candy" means a
6preparation of sugar, honey, or other natural or artificial
7sweeteners in combination with chocolate, fruits, nuts or other
8ingredients or flavorings in the form of bars, drops, or
9pieces. "Candy" does not include any preparation that contains
10flour or requires refrigeration.
11    Notwithstanding any other provisions of this Act,
12beginning September 1, 2009, "nonprescription medicines and
13drugs" does not include grooming and hygiene products. For
14purposes of this Section, "grooming and hygiene products"
15includes, but is not limited to, soaps and cleaning solutions,
16shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
17lotions and screens, unless those products are available by
18prescription only, regardless of whether the products meet the
19definition of "over-the-counter-drugs". For the purposes of
20this paragraph, "over-the-counter-drug" means a drug for human
21use that contains a label that identifies the product as a drug
22as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
23label includes:
24        (A) A "Drug Facts" panel; or
25        (B) A statement of the "active ingredient(s)" with a
26    list of those ingredients contained in the compound,

 

 

SB3296- 49 -LRB101 19659 HLH 69147 b

1    substance or preparation.
2    Beginning on January 1, 2014 (the effective date of Public
3Act 98-122), "prescription and nonprescription medicines and
4drugs" includes medical cannabis purchased from a registered
5dispensing organization under the Compassionate Use of Medical
6Cannabis Program Act.
7    As used in this Section, "adult use cannabis" means
8cannabis subject to tax under the Cannabis Cultivation
9Privilege Tax Law and the Cannabis Purchaser Excise Tax Law and
10does not include cannabis subject to tax under the
11Compassionate Use of Medical Cannabis Program Act.
12    If the property that is acquired from a serviceman is
13acquired outside Illinois and used outside Illinois before
14being brought to Illinois for use here and is taxable under
15this Act, the "selling price" on which the tax is computed
16shall be reduced by an amount that represents a reasonable
17allowance for depreciation for the period of prior out-of-state
18use.
19(Source: P.A. 100-22, eff. 7-6-17; 101-363, eff. 8-9-19;
20101-593, eff. 12-4-19.)
 
21    Section 15. The Service Occupation Tax Act is amended by
22changing Sections 3-5 and 3-10 as follows:
 
23    (35 ILCS 115/3-5)
24    Sec. 3-5. Exemptions. The following tangible personal

 

 

SB3296- 50 -LRB101 19659 HLH 69147 b

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

 

 

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1    (4) Legal tender, currency, medallions, or gold or silver
2coinage issued by the State of Illinois, the government of the
3United States of America, or the government of any foreign
4country, and bullion.
5    (5) Until July 1, 2003 and beginning again on September 1,
62004 through August 30, 2014, graphic arts machinery and
7equipment, including repair and replacement parts, both new and
8used, and including that manufactured on special order or
9purchased for lease, certified by the purchaser to be used
10primarily for graphic arts production. Equipment includes
11chemicals or chemicals acting as catalysts but only if the
12chemicals or chemicals acting as catalysts effect a direct and
13immediate change upon a graphic arts product. Beginning on July
141, 2017, graphic arts machinery and equipment is included in
15the manufacturing and assembling machinery and equipment
16exemption under Section 2 of this Act.
17    (6) Personal property sold by a teacher-sponsored student
18organization affiliated with an elementary or secondary school
19located in Illinois.
20    (7) Farm machinery and equipment, both new and used,
21including that manufactured on special order, certified by the
22purchaser to be used primarily for production agriculture or
23State or federal agricultural programs, including individual
24replacement parts for the machinery and equipment, including
25machinery and equipment purchased for lease, and including
26implements of husbandry defined in Section 1-130 of the

 

 

SB3296- 52 -LRB101 19659 HLH 69147 b

1Illinois Vehicle Code, farm machinery and agricultural
2chemical and fertilizer spreaders, and nurse wagons required to
3be registered under Section 3-809 of the Illinois Vehicle Code,
4but excluding other motor vehicles required to be registered
5under the Illinois Vehicle Code. Horticultural polyhouses or
6hoop houses used for propagating, growing, or overwintering
7plants shall be considered farm machinery and equipment under
8this item (7). Agricultural chemical tender tanks and dry boxes
9shall include units sold separately from a motor vehicle
10required to be licensed and units sold mounted on a motor
11vehicle required to be licensed if the selling price of the
12tender is separately stated.
13    Farm machinery and equipment shall include precision
14farming equipment that is installed or purchased to be
15installed on farm machinery and equipment including, but not
16limited to, tractors, harvesters, sprayers, planters, seeders,
17or spreaders. Precision farming equipment includes, but is not
18limited to, soil testing sensors, computers, monitors,
19software, global positioning and mapping systems, and other
20such equipment.
21    Farm machinery and equipment also includes computers,
22sensors, software, and related equipment used primarily in the
23computer-assisted operation of production agriculture
24facilities, equipment, and activities such as, but not limited
25to, the collection, monitoring, and correlation of animal and
26crop data for the purpose of formulating animal diets and

 

 

SB3296- 53 -LRB101 19659 HLH 69147 b

1agricultural chemicals. This item (7) is exempt from the
2provisions of Section 3-55.
3    (8) Until June 30, 2013, fuel and petroleum products sold
4to or used by an air common carrier, certified by the carrier
5to be used for consumption, shipment, or storage in the conduct
6of its business as an air common carrier, for a flight destined
7for or returning from a location or locations outside the
8United States without regard to previous or subsequent domestic
9stopovers.
10    Beginning July 1, 2013, fuel and petroleum products sold to
11or used by an air carrier, certified by the carrier to be used
12for consumption, shipment, or storage in the conduct of its
13business as an air common carrier, for a flight that (i) is
14engaged in foreign trade or is engaged in trade between the
15United States and any of its possessions and (ii) transports at
16least one individual or package for hire from the city of
17origination to the city of final destination on the same
18aircraft, without regard to a change in the flight number of
19that aircraft.
20    (9) Proceeds of mandatory service charges separately
21stated on customers' bills for the purchase and consumption of
22food and beverages, to the extent that the proceeds of the
23service charge are in fact turned over as tips or as a
24substitute for tips to the employees who participate directly
25in preparing, serving, hosting or cleaning up the food or
26beverage function with respect to which the service charge is

 

 

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1imposed.
2    (10) Until July 1, 2003, oil field exploration, drilling,
3and production equipment, including (i) rigs and parts of rigs,
4rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
5tubular goods, including casing and drill strings, (iii) pumps
6and pump-jack units, (iv) storage tanks and flow lines, (v) any
7individual replacement part for oil field exploration,
8drilling, and production equipment, and (vi) machinery and
9equipment purchased for lease; but excluding motor vehicles
10required to be registered under the Illinois Vehicle Code.
11    (11) Photoprocessing machinery and equipment, including
12repair and replacement parts, both new and used, including that
13manufactured on special order, certified by the purchaser to be
14used primarily for photoprocessing, and including
15photoprocessing machinery and equipment purchased for lease.
16    (12) Until July 1, 2023, coal and aggregate exploration,
17mining, off-highway hauling, processing, maintenance, and
18reclamation equipment, including replacement parts and
19equipment, and including equipment purchased for lease, but
20excluding motor vehicles required to be registered under the
21Illinois Vehicle Code. The changes made to this Section by
22Public Act 97-767 apply on and after July 1, 2003, but no claim
23for credit or refund is allowed on or after August 16, 2013
24(the effective date of Public Act 98-456) for such taxes paid
25during the period beginning July 1, 2003 and ending on August
2616, 2013 (the effective date of Public Act 98-456).

 

 

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1    (13) Beginning January 1, 1992 and through June 30, 2016,
2food for human consumption that is to be consumed off the
3premises where it is sold (other than alcoholic beverages, soft
4drinks and food that has been prepared for immediate
5consumption) and prescription and non-prescription medicines,
6drugs, medical appliances, and insulin, urine testing
7materials, syringes, and needles used by diabetics, for human
8use, when purchased for use by a person receiving medical
9assistance under Article V of the Illinois Public Aid Code who
10resides in a licensed long-term care facility, as defined in
11the Nursing Home Care Act, or in a licensed facility as defined
12in the ID/DD Community Care Act, the MC/DD Act, or the
13Specialized Mental Health Rehabilitation Act of 2013.
14    (14) Semen used for artificial insemination of livestock
15for direct agricultural production.
16    (15) Horses, or interests in horses, registered with and
17meeting the requirements of any of the Arabian Horse Club
18Registry of America, Appaloosa Horse Club, American Quarter
19Horse Association, United States Trotting Association, or
20Jockey Club, as appropriate, used for purposes of breeding or
21racing for prizes. This item (15) is exempt from the provisions
22of Section 3-55, and the exemption provided for under this item
23(15) applies for all periods beginning May 30, 1995, but no
24claim for credit or refund is allowed on or after January 1,
252008 (the effective date of Public Act 95-88) for such taxes
26paid during the period beginning May 30, 2000 and ending on

 

 

SB3296- 56 -LRB101 19659 HLH 69147 b

1January 1, 2008 (the effective date of Public Act 95-88).
2    (16) Computers and communications equipment utilized for
3any hospital purpose and equipment used in the diagnosis,
4analysis, or treatment of hospital patients sold to a lessor
5who leases the equipment, under a lease of one year or longer
6executed or in effect at the time of the purchase, 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.
10    (17) 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.
16    (18) Beginning with taxable years ending on or after
17December 31, 1995 and ending with taxable years ending on or
18before December 31, 2004, personal property that is donated for
19disaster relief to be used in a State or federally declared
20disaster area in Illinois or bordering Illinois by a
21manufacturer or retailer that is registered in this State to a
22corporation, society, association, foundation, or institution
23that has been issued a sales tax exemption identification
24number by the Department that assists victims of the disaster
25who reside within the declared disaster area.
26    (19) Beginning with taxable years ending on or after

 

 

SB3296- 57 -LRB101 19659 HLH 69147 b

1December 31, 1995 and ending with taxable years ending on or
2before December 31, 2004, personal property that is used in the
3performance of infrastructure repairs in this State, including
4but not limited to municipal roads and streets, access roads,
5bridges, sidewalks, waste disposal systems, water and sewer
6line extensions, water distribution and purification
7facilities, storm water drainage and retention facilities, and
8sewage treatment facilities, resulting from a State or
9federally declared disaster in Illinois or bordering Illinois
10when such repairs are initiated on facilities located in the
11declared disaster area within 6 months after the disaster.
12    (20) Beginning July 1, 1999, game or game birds sold at a
13"game breeding and hunting preserve area" as that term is used
14in the Wildlife Code. This paragraph is exempt from the
15provisions of Section 3-55.
16    (21) A motor vehicle, as that term is defined in Section
171-146 of the Illinois Vehicle Code, that is donated to a
18corporation, limited liability company, society, association,
19foundation, or institution that is determined by the Department
20to be organized and operated exclusively for educational
21purposes. For purposes of this exemption, "a corporation,
22limited liability company, society, association, foundation,
23or institution organized and operated exclusively for
24educational purposes" means all tax-supported public schools,
25private schools that offer systematic instruction in useful
26branches of learning by methods common to public schools and

 

 

SB3296- 58 -LRB101 19659 HLH 69147 b

1that compare favorably in their scope and intensity with the
2course of study presented in tax-supported schools, and
3vocational or technical schools or institutes organized and
4operated exclusively to provide a course of study of not less
5than 6 weeks duration and designed to prepare individuals to
6follow a trade or to pursue a manual, technical, mechanical,
7industrial, business, or commercial occupation.
8    (22) Beginning January 1, 2000, personal property,
9including food, purchased through fundraising events for the
10benefit of a public or private elementary or secondary school,
11a group of those schools, or one or more school districts if
12the events are sponsored by an entity recognized by the school
13district that consists primarily of volunteers and includes
14parents and teachers of the school children. This paragraph
15does not apply to fundraising events (i) for the benefit of
16private home instruction or (ii) for which the fundraising
17entity purchases the personal property sold at the events from
18another individual or entity that sold the property for the
19purpose of resale by the fundraising entity and that profits
20from the sale to the fundraising entity. This paragraph is
21exempt from the provisions of Section 3-55.
22    (23) Beginning January 1, 2000 and through December 31,
232001, new or used automatic vending machines that prepare and
24serve hot food and beverages, including coffee, soup, and other
25items, and replacement parts for these machines. Beginning
26January 1, 2002 and through June 30, 2003, machines and parts

 

 

SB3296- 59 -LRB101 19659 HLH 69147 b

1for machines used in commercial, coin-operated amusement and
2vending business if a use or occupation tax is paid on the
3gross receipts derived from the use of the commercial,
4coin-operated amusement and vending machines. This paragraph
5is exempt from the provisions of Section 3-55.
6    (24) Beginning on August 2, 2001 (the effective date of
7Public Act 92-227), computers and communications equipment
8utilized for any hospital purpose and equipment used in the
9diagnosis, analysis, or treatment of hospital patients sold to
10a lessor who leases the equipment, under a lease of one year or
11longer executed or in effect at the time of the purchase, 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. This paragraph is exempt from
15the provisions of Section 3-55.
16    (25) Beginning on August 2, 2001 (the effective date of
17Public Act 92-227), personal property sold to a lessor who
18leases the property, under a lease of one year or longer
19executed or in effect at the time of the purchase, to a
20governmental body that has been issued an active tax exemption
21identification number by the Department under Section 1g of the
22Retailers' Occupation Tax Act. This paragraph is exempt from
23the provisions of Section 3-55.
24    (26) Beginning on January 1, 2002 and through June 30,
252016, tangible personal property purchased from an Illinois
26retailer by a taxpayer engaged in centralized purchasing

 

 

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1activities in Illinois who will, upon receipt of the property
2in Illinois, temporarily store the property in Illinois (i) for
3the purpose of subsequently transporting it outside this State
4for use or consumption thereafter solely outside this State or
5(ii) for the purpose of being processed, fabricated, or
6manufactured into, attached to, or incorporated into other
7tangible personal property to be transported outside this State
8and thereafter used or consumed solely outside this State. The
9Director of Revenue shall, pursuant to rules adopted in
10accordance with the Illinois Administrative Procedure Act,
11issue a permit to any taxpayer in good standing with the
12Department who is eligible for the exemption under this
13paragraph (26). The permit issued under this paragraph (26)
14shall authorize the holder, to the extent and in the manner
15specified in the rules adopted under this Act, to purchase
16tangible personal property from a retailer exempt from the
17taxes imposed by this Act. Taxpayers shall maintain all
18necessary books and records to substantiate the use and
19consumption of all such tangible personal property outside of
20the State of Illinois.
21    (27) 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 3-55.
2    (28) Tangible personal property sold to a
3public-facilities corporation, as described in Section
411-65-10 of the Illinois Municipal Code, for purposes of
5constructing or furnishing a municipal convention hall, but
6only if the legal title to the municipal convention hall is
7transferred to the municipality without any further
8consideration by or on behalf of the municipality at the time
9of the completion of the municipal convention hall or upon the
10retirement or redemption of any bonds or other debt instruments
11issued by the public-facilities corporation in connection with
12the development of the municipal convention hall. This
13exemption includes existing public-facilities corporations as
14provided in Section 11-65-25 of the Illinois Municipal Code.
15This paragraph is exempt from the provisions of Section 3-55.
16    (29) Beginning January 1, 2010, materials, parts,
17equipment, components, and furnishings incorporated into or
18upon an aircraft as part of the modification, refurbishment,
19completion, replacement, repair, or maintenance of the
20aircraft. This exemption includes consumable supplies used in
21the modification, refurbishment, completion, replacement,
22repair, and maintenance of aircraft, but excludes any
23materials, parts, equipment, components, and consumable
24supplies used in the modification, replacement, repair, and
25maintenance of aircraft engines or power plants, whether such
26engines or power plants are installed or uninstalled upon any

 

 

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1such aircraft. "Consumable supplies" include, but are not
2limited to, adhesive, tape, sandpaper, general purpose
3lubricants, cleaning solution, latex gloves, and protective
4films. This exemption applies only to the transfer of
5qualifying tangible personal property incident to the
6modification, refurbishment, completion, replacement, repair,
7or maintenance of an aircraft by persons who (i) hold an Air
8Agency Certificate and are empowered to operate an approved
9repair station by the Federal Aviation Administration, (ii)
10have a Class IV Rating, and (iii) conduct operations in
11accordance with Part 145 of the Federal Aviation Regulations.
12The exemption does not include aircraft operated by a
13commercial 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 (29) by Public Act 98-534 are declarative of existing
17law.
18    (30) Beginning January 1, 2017, menstrual pads, tampons,
19and menstrual cups.
20    (31) Tangible personal property transferred to a purchaser
21who is exempt from tax by operation of federal law. This
22paragraph is exempt from the provisions of Section 3-55.
23    (32) Qualified tangible personal property used in the
24construction or operation of a data center that has been
25granted a certificate of exemption by the Department of
26Commerce and Economic Opportunity, whether that tangible

 

 

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1personal property is purchased by the owner, operator, or
2tenant of the data center or by a contractor or subcontractor
3of the owner, operator, or tenant. Data centers that would have
4qualified for a certificate of exemption prior to January 1,
52020 had this amendatory Act of the 101st General Assembly been
6in effect, may apply for and obtain an exemption for subsequent
7purchases of computer equipment or enabling software purchased
8or leased to upgrade, supplement, or replace computer equipment
9or enabling software purchased or leased in the original
10investment that would have qualified.
11    The Department of Commerce and Economic Opportunity shall
12grant a certificate of exemption under this item (32) to
13qualified data centers as defined by Section 605-1025 of the
14Department of Commerce and Economic Opportunity Law of the
15Civil Administrative Code of Illinois.
16    For the purposes of this item (32):
17        "Data center" means a building or a series of buildings
18    rehabilitated or constructed to house working servers in
19    one physical location or multiple sites within the State of
20    Illinois.
21        "Qualified tangible personal property" means:
22    electrical systems and equipment; climate control and
23    chilling equipment and systems; mechanical systems and
24    equipment; monitoring and secure systems; emergency
25    generators; hardware; computers; servers; data storage
26    devices; network connectivity equipment; racks; cabinets;

 

 

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1    telecommunications cabling infrastructure; raised floor
2    systems; peripheral components or systems; software;
3    mechanical, electrical, or plumbing systems; battery
4    systems; cooling systems and towers; temperature control
5    systems; other cabling; and other data center
6    infrastructure equipment and systems necessary to operate
7    qualified tangible personal property, including fixtures;
8    and component parts of any of the foregoing, including
9    installation, maintenance, repair, refurbishment, and
10    replacement of qualified tangible personal property to
11    generate, transform, transmit, distribute, or manage
12    electricity necessary to operate qualified tangible
13    personal property; and all other tangible personal
14    property that is essential to the operations of a computer
15    data center. The term "qualified tangible personal
16    property" also includes building materials physically
17    incorporated in to the qualifying data center. To document
18    the exemption allowed under this Section, the retailer must
19    obtain from the purchaser a copy of the certificate of
20    eligibility issued by the Department of Commerce and
21    Economic Opportunity.
22    This item (32) is exempt from the provisions of Section
233-55.
24    (33) Beginning July 1, 2020, prescription medicines and
25medical devices (including, but not limited to, products
26classified as Class III medical devices by the United States

 

 

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1Food and Drug Administration that are used for cancer treatment
2pursuant to a prescription, as well as any accessories and
3components related to those devices). This item (33) is exempt
4from the provisions of Section 3-55.
5(Source: P.A. 100-22, eff. 7-6-17; 100-594, eff. 6-29-18;
6100-1171, eff. 1-4-19; 101-31, eff. 6-28-19; 101-81, eff.
77-12-19.)
 
8    (35 ILCS 115/3-10)  (from Ch. 120, par. 439.103-10)
9    Sec. 3-10. Rate of tax. Unless otherwise provided in this
10Section, the tax imposed by this Act is at the rate of 6.25% of
11the "selling price", as defined in Section 2 of the Service Use
12Tax Act, of the tangible personal property. For the purpose of
13computing this tax, in no event shall the "selling price" be
14less than the cost price to the serviceman of the tangible
15personal property transferred. The selling price of each item
16of tangible personal property transferred as an incident of a
17sale of service may be shown as a distinct and separate item on
18the serviceman's billing to the service customer. If the
19selling price is not so shown, the selling price of the
20tangible personal property is deemed to be 50% of the
21serviceman's entire billing to the service customer. When,
22however, a serviceman contracts to design, develop, and produce
23special order machinery or equipment, the tax imposed by this
24Act shall be based on the serviceman's cost price of the
25tangible personal property transferred incident to the

 

 

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1completion of the contract.
2    Beginning on July 1, 2000 and through December 31, 2000,
3with respect to motor fuel, as defined in Section 1.1 of the
4Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
5the Use Tax Act, the tax is imposed at the rate of 1.25%.
6    With respect to gasohol, as defined in the Use Tax Act, the
7tax imposed by this Act shall apply to (i) 70% of the cost
8price of property transferred as an incident to the sale of
9service on or after January 1, 1990, and before July 1, 2003,
10(ii) 80% of the selling price of property transferred as an
11incident to the sale of service on or after July 1, 2003 and on
12or before July 1, 2017, and (iii) 100% of the cost price
13thereafter. If, at any time, however, the tax under this Act on
14sales of gasohol, as defined in the Use Tax Act, is imposed at
15the rate of 1.25%, then the tax imposed by this Act applies to
16100% of the proceeds of sales of gasohol made during that time.
17    With respect to majority blended ethanol fuel, as defined
18in the Use Tax Act, the tax imposed by this Act does not apply
19to the selling price of property transferred as an incident to
20the sale of service on or after July 1, 2003 and on or before
21December 31, 2023 but applies to 100% of the selling price
22thereafter.
23    With respect to biodiesel blends, as defined in the Use Tax
24Act, with no less than 1% and no more than 10% biodiesel, the
25tax imposed by this Act applies to (i) 80% of the selling price
26of property transferred as an incident to the sale of service

 

 

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1on or after July 1, 2003 and on or before December 31, 2018 and
2(ii) 100% of the proceeds of the selling price thereafter. If,
3at any time, however, the tax under this Act on sales of
4biodiesel blends, as defined in the Use Tax Act, with no less
5than 1% and no more than 10% biodiesel is imposed at the rate
6of 1.25%, then the tax imposed by this Act applies to 100% of
7the proceeds of sales of biodiesel blends with no less than 1%
8and no more than 10% biodiesel made during that time.
9    With respect to 100% biodiesel, as defined in the Use Tax
10Act, and biodiesel blends, as defined in the Use Tax Act, with
11more than 10% but no more than 99% biodiesel material, the tax
12imposed by this Act does not apply to the proceeds of the
13selling price of property transferred as an incident to the
14sale of service on or after July 1, 2003 and on or before
15December 31, 2023 but applies to 100% of the selling price
16thereafter.
17    At the election of any registered serviceman made for each
18fiscal year, sales of service in which the aggregate annual
19cost price of tangible personal property transferred as an
20incident to the sales of service is less than 35%, or 75% in
21the case of servicemen transferring prescription drugs or
22servicemen engaged in graphic arts production, of the aggregate
23annual total gross receipts from all sales of service, the tax
24imposed by this Act shall be based on the serviceman's cost
25price of the tangible personal property transferred incident to
26the sale of those services.

 

 

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1    The tax shall be imposed at the rate of 1% on food prepared
2for immediate consumption and transferred incident to a sale of
3service subject to this Act or the Service Occupation Tax Act
4by an entity licensed under the Hospital Licensing Act, the
5Nursing Home Care Act, the ID/DD Community Care Act, the MC/DD
6Act, the Specialized Mental Health Rehabilitation Act of 2013,
7or the Child Care Act of 1969. The tax shall also be imposed at
8the rate of 1% on food for human consumption that is to be
9consumed off the premises where it is sold (other than
10alcoholic beverages, food consisting of or infused with adult
11use cannabis, soft drinks, and food that has been prepared for
12immediate consumption and is not otherwise included in this
13paragraph) and prescription and nonprescription medicines and
14, drugs, medical appliances that are not exempt under item (33)
15of Section 3-5, products classified as Class III medical
16devices by the United States Food and Drug Administration that
17are used for cancer treatment pursuant to a prescription, as
18well as any accessories and components related to those
19devices, modifications to a motor vehicle for the purpose of
20rendering it usable by a person with a disability, and insulin,
21urine testing materials, syringes, and needles used by
22diabetics, for human use. For the purposes of this Section,
23until September 1, 2009: the term "soft drinks" means any
24complete, finished, ready-to-use, non-alcoholic drink, whether
25carbonated or not, including but not limited to soda water,
26cola, fruit juice, vegetable juice, carbonated water, and all

 

 

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1other preparations commonly known as soft drinks of whatever
2kind or description that are contained in any closed or sealed
3can, carton, or container, regardless of size; but "soft
4drinks" does not include coffee, tea, non-carbonated water,
5infant formula, milk or milk products as defined in the Grade A
6Pasteurized Milk and Milk Products Act, or drinks containing
750% or more natural fruit or vegetable juice.
8    Notwithstanding any other provisions of this Act,
9beginning September 1, 2009, "soft drinks" means non-alcoholic
10beverages that contain natural or artificial sweeteners. "Soft
11drinks" do not include beverages that contain milk or milk
12products, soy, rice or similar milk substitutes, or greater
13than 50% of vegetable or fruit juice by volume.
14    Until August 1, 2009, and notwithstanding any other
15provisions of this Act, "food for human consumption that is to
16be consumed off the premises where it is sold" includes all
17food sold through a vending machine, except soft drinks and
18food products that are dispensed hot from a vending machine,
19regardless of the location of the vending machine. Beginning
20August 1, 2009, and notwithstanding any other provisions of
21this Act, "food for human consumption that is to be consumed
22off the premises where it is sold" includes all food sold
23through a vending machine, except soft drinks, candy, and food
24products that are dispensed hot from a vending machine,
25regardless of the location of the vending machine.
26    Notwithstanding any other provisions of this Act,

 

 

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1beginning September 1, 2009, "food for human consumption that
2is to be consumed off the premises where it is sold" does not
3include candy. For purposes of this Section, "candy" means a
4preparation of sugar, honey, or other natural or artificial
5sweeteners in combination with chocolate, fruits, nuts or other
6ingredients or flavorings in the form of bars, drops, or
7pieces. "Candy" does not include any preparation that contains
8flour or requires refrigeration.
9    Notwithstanding any other provisions of this Act,
10beginning September 1, 2009, "nonprescription medicines and
11drugs" does not include grooming and hygiene products. For
12purposes of this Section, "grooming and hygiene products"
13includes, but is not limited to, soaps and cleaning solutions,
14shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
15lotions and screens, unless those products are available by
16prescription only, regardless of whether the products meet the
17definition of "over-the-counter-drugs". For the purposes of
18this paragraph, "over-the-counter-drug" means a drug for human
19use that contains a label that identifies the product as a drug
20as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
21label includes:
22        (A) A "Drug Facts" panel; or
23        (B) A statement of the "active ingredient(s)" with a
24    list of those ingredients contained in the compound,
25    substance or preparation.
26    Beginning on January 1, 2014 (the effective date of Public

 

 

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1Act 98-122), "prescription and nonprescription medicines and
2drugs" includes medical cannabis purchased from a registered
3dispensing organization under the Compassionate Use of Medical
4Cannabis Program Act.
5    As used in this Section, "adult use cannabis" means
6cannabis subject to tax under the Cannabis Cultivation
7Privilege Tax Law and the Cannabis Purchaser Excise Tax Law and
8does not include cannabis subject to tax under the
9Compassionate Use of Medical Cannabis Program Act.
10(Source: P.A. 100-22, eff. 7-6-17; 101-363, eff. 8-9-19;
11101-593, eff. 12-4-19.)
 
12    Section 20. The Retailers' Occupation Tax Act is amended by
13changing Sections 2-5 and 2-10 as follows:
 
14    (35 ILCS 120/2-5)
15    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
16sale of the following tangible personal property are exempt
17from the tax imposed by this Act:
18        (1) Farm chemicals.
19        (2) Farm machinery and equipment, both new and used,
20    including that manufactured on special order, certified by
21    the purchaser to be used primarily for production
22    agriculture or State or federal agricultural programs,
23    including individual replacement parts for the machinery
24    and equipment, including machinery and equipment purchased

 

 

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

 

 

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1    limited to, the collection, monitoring, and correlation of
2    animal and crop data for the purpose of formulating animal
3    diets and agricultural chemicals. This item (2) is exempt
4    from the provisions of Section 2-70.
5        (3) Until July 1, 2003, distillation machinery and
6    equipment, sold as a unit or kit, assembled or installed by
7    the retailer, certified by the user to be used only for the
8    production of ethyl alcohol that will be used for
9    consumption as motor fuel or as a component of motor fuel
10    for the personal use of the user, and not subject to sale
11    or resale.
12        (4) Until July 1, 2003 and beginning again September 1,
13    2004 through August 30, 2014, graphic arts machinery and
14    equipment, including repair and replacement parts, both
15    new and used, and including that manufactured on special
16    order or purchased for lease, certified by the purchaser to
17    be used primarily for graphic arts production. Equipment
18    includes chemicals or chemicals acting as catalysts but
19    only if the chemicals or chemicals acting as catalysts
20    effect a direct and immediate change upon a graphic arts
21    product. Beginning on July 1, 2017, graphic arts machinery
22    and equipment is included in the manufacturing and
23    assembling machinery and equipment exemption under
24    paragraph (14).
25        (5) A motor vehicle that is used for automobile
26    renting, as defined in the Automobile Renting Occupation

 

 

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1    and Use Tax Act. This paragraph is exempt from the
2    provisions of Section 2-70.
3        (6) Personal property sold by a teacher-sponsored
4    student organization affiliated with an elementary or
5    secondary school located in Illinois.
6        (7) Until July 1, 2003, proceeds of that portion of the
7    selling price of a passenger car the sale of which is
8    subject to the Replacement Vehicle Tax.
9        (8) Personal property sold to an Illinois county fair
10    association for use in conducting, operating, or promoting
11    the county fair.
12        (9) Personal property sold to a not-for-profit arts or
13    cultural organization that establishes, by proof required
14    by the Department by rule, that it has received an
15    exemption under Section 501(c)(3) of the Internal Revenue
16    Code and that is organized and operated primarily for the
17    presentation or support of arts or cultural programming,
18    activities, or services. These organizations include, but
19    are not limited to, music and dramatic arts organizations
20    such as symphony orchestras and theatrical groups, arts and
21    cultural service organizations, local arts councils,
22    visual arts organizations, and media arts organizations.
23    On and after July 1, 2001 (the effective date of Public Act
24    92-35), however, an entity otherwise eligible for this
25    exemption shall not make tax-free purchases unless it has
26    an active identification number issued by the Department.

 

 

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1        (10) Personal property sold by a corporation, society,
2    association, foundation, institution, or organization,
3    other than a limited liability company, that is organized
4    and operated as a not-for-profit service enterprise for the
5    benefit of persons 65 years of age or older if the personal
6    property was not purchased by the enterprise for the
7    purpose of resale by the enterprise.
8        (11) Personal property sold to a governmental body, to
9    a corporation, society, association, foundation, or
10    institution organized and operated exclusively for
11    charitable, religious, or educational purposes, or to a
12    not-for-profit corporation, society, association,
13    foundation, institution, or organization that has no
14    compensated officers or employees and that is organized and
15    operated primarily for the recreation of persons 55 years
16    of age or older. A limited liability company may qualify
17    for the exemption under this paragraph only if the limited
18    liability company is organized and operated exclusively
19    for educational purposes. On and after July 1, 1987,
20    however, no entity otherwise eligible for this exemption
21    shall make tax-free purchases unless it has an active
22    identification number issued by the Department.
23        (12) (Blank).
24        (12-5) On and after July 1, 2003 and through June 30,
25    2004, motor vehicles of the second division with a gross
26    vehicle weight in excess of 8,000 pounds that are subject

 

 

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1    to the commercial distribution fee imposed under Section
2    3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
3    2004 and through June 30, 2005, the use in this State of
4    motor vehicles of the second division: (i) with a gross
5    vehicle weight rating in excess of 8,000 pounds; (ii) that
6    are subject to the commercial distribution fee imposed
7    under Section 3-815.1 of the Illinois Vehicle Code; and
8    (iii) that are primarily used for commercial purposes.
9    Through June 30, 2005, this exemption applies to repair and
10    replacement parts added after the initial purchase of such
11    a motor vehicle if that motor vehicle is used in a manner
12    that would qualify for the rolling stock exemption
13    otherwise provided for in this Act. For purposes of this
14    paragraph, "used for commercial purposes" means the
15    transportation of persons or property in furtherance of any
16    commercial or industrial enterprise whether for-hire or
17    not.
18        (13) Proceeds from sales to owners, lessors, or
19    shippers of tangible personal property that is utilized by
20    interstate carriers for hire for use as rolling stock
21    moving in interstate commerce and equipment operated by a
22    telecommunications provider, licensed as a common carrier
23    by the Federal Communications Commission, which is
24    permanently installed in or affixed to aircraft moving in
25    interstate commerce.
26        (14) Machinery and equipment that will be used by the

 

 

SB3296- 77 -LRB101 19659 HLH 69147 b

1    purchaser, or a lessee of the purchaser, primarily in the
2    process of manufacturing or assembling tangible personal
3    property for wholesale or retail sale or lease, whether the
4    sale or lease is made directly by the manufacturer or by
5    some other person, whether the materials used in the
6    process are owned by the manufacturer or some other person,
7    or whether the sale or lease is made apart from or as an
8    incident to the seller's engaging in the service occupation
9    of producing machines, tools, dies, jigs, patterns,
10    gauges, or other similar items of no commercial value on
11    special order for a particular purchaser. The exemption
12    provided by this paragraph (14) does not include machinery
13    and equipment used in (i) the generation of electricity for
14    wholesale or retail sale; (ii) the generation or treatment
15    of natural or artificial gas for wholesale or retail sale
16    that is delivered to customers through pipes, pipelines, or
17    mains; or (iii) the treatment of water for wholesale or
18    retail sale that is delivered to customers through pipes,
19    pipelines, or mains. The provisions of Public Act 98-583
20    are declaratory of existing law as to the meaning and scope
21    of this exemption. Beginning on July 1, 2017, the exemption
22    provided by this paragraph (14) includes, but is not
23    limited to, graphic arts machinery and equipment, as
24    defined in paragraph (4) of this Section.
25        (15) Proceeds of mandatory service charges separately
26    stated on customers' bills for purchase and consumption of

 

 

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1    food and beverages, to the extent that the proceeds of the
2    service charge are in fact turned over as tips or as a
3    substitute for tips to the employees who participate
4    directly in preparing, serving, hosting or cleaning up the
5    food or beverage function with respect to which the service
6    charge is imposed.
7        (16) Tangible personal property sold to a purchaser if
8    the purchaser is exempt from use tax by operation of
9    federal law. This paragraph is exempt from the provisions
10    of Section 2-70.
11        (17) Tangible personal property sold to a common
12    carrier by rail or motor that receives the physical
13    possession of the property in Illinois and that transports
14    the property, or shares with another common carrier in the
15    transportation of the property, out of Illinois on a
16    standard uniform bill of lading showing the seller of the
17    property as the shipper or consignor of the property to a
18    destination outside Illinois, for use outside Illinois.
19        (18) Legal tender, currency, medallions, or gold or
20    silver coinage issued by the State of Illinois, the
21    government of the United States of America, or the
22    government of any foreign country, and bullion.
23        (19) Until July 1, 2003, oil field exploration,
24    drilling, and production equipment, including (i) rigs and
25    parts of rigs, rotary rigs, cable tool rigs, and workover
26    rigs, (ii) pipe and tubular goods, including casing and

 

 

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1    drill strings, (iii) pumps and pump-jack units, (iv)
2    storage tanks and flow lines, (v) any individual
3    replacement part for oil field exploration, drilling, and
4    production equipment, and (vi) machinery and equipment
5    purchased for lease; but excluding motor vehicles required
6    to be registered under the Illinois Vehicle Code.
7        (20) Photoprocessing machinery and equipment,
8    including repair and replacement parts, both new and used,
9    including that manufactured on special order, certified by
10    the purchaser to be used primarily for photoprocessing, and
11    including photoprocessing machinery and equipment
12    purchased for lease.
13        (21) Until July 1, 2023, coal and aggregate
14    exploration, mining, off-highway hauling, processing,
15    maintenance, and reclamation equipment, including
16    replacement parts and equipment, and including equipment
17    purchased for lease, but excluding motor vehicles required
18    to be registered under the Illinois Vehicle Code. The
19    changes made to this Section by Public Act 97-767 apply on
20    and after July 1, 2003, but no claim for credit or refund
21    is allowed on or after August 16, 2013 (the effective date
22    of Public Act 98-456) for such taxes paid during the period
23    beginning July 1, 2003 and ending on August 16, 2013 (the
24    effective date of Public Act 98-456).
25        (22) Until June 30, 2013, fuel and petroleum products
26    sold to or used by an air carrier, certified by the carrier

 

 

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1    to be used for consumption, shipment, or storage in the
2    conduct of its business as an air common carrier, for a
3    flight destined for or returning from a location or
4    locations outside the United States without regard to
5    previous or subsequent domestic stopovers.
6        Beginning July 1, 2013, fuel and petroleum products
7    sold to or used by an air carrier, certified by the carrier
8    to be used for consumption, shipment, or storage in the
9    conduct of its business as an air common carrier, for a
10    flight that (i) is engaged in foreign trade or is engaged
11    in trade between the United States and any of its
12    possessions and (ii) transports at least one individual or
13    package for hire from the city of origination to the city
14    of final destination on the same aircraft, without regard
15    to a change in the flight number of that aircraft.
16        (23) A transaction in which the purchase order is
17    received by a florist who is located outside Illinois, but
18    who has a florist located in Illinois deliver the property
19    to the purchaser or the purchaser's donee in Illinois.
20        (24) Fuel consumed or used in the operation of ships,
21    barges, or vessels that are used primarily in or for the
22    transportation of property or the conveyance of persons for
23    hire on rivers bordering on this State if the fuel is
24    delivered by the seller to the purchaser's barge, ship, or
25    vessel while it is afloat upon that bordering river.
26        (25) Except as provided in item (25-5) of this Section,

 

 

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1    a motor vehicle sold in this State to a nonresident even
2    though the motor vehicle is delivered to the nonresident in
3    this State, if the motor vehicle is not to be titled in
4    this State, and if a drive-away permit is issued to the
5    motor vehicle as provided in Section 3-603 of the Illinois
6    Vehicle Code or if the nonresident purchaser has vehicle
7    registration plates to transfer to the motor vehicle upon
8    returning to his or her home state. The issuance of the
9    drive-away permit or having the out-of-state registration
10    plates to be transferred is prima facie evidence that the
11    motor vehicle will not be titled in this State.
12        (25-5) The exemption under item (25) does not apply if
13    the state in which the motor vehicle will be titled does
14    not allow a reciprocal exemption for a motor vehicle sold
15    and delivered in that state to an Illinois resident but
16    titled in Illinois. The tax collected under this Act on the
17    sale of a motor vehicle in this State to a resident of
18    another state that does not allow a reciprocal exemption
19    shall be imposed at a rate equal to the state's rate of tax
20    on taxable property in the state in which the purchaser is
21    a resident, except that the tax shall not exceed the tax
22    that would otherwise be imposed under this Act. At the time
23    of the sale, the purchaser shall execute a statement,
24    signed under penalty of perjury, of his or her intent to
25    title the vehicle in the state in which the purchaser is a
26    resident within 30 days after the sale and of the fact of

 

 

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1    the payment to the State of Illinois of tax in an amount
2    equivalent to the state's rate of tax on taxable property
3    in his or her state of residence and shall submit the
4    statement to the appropriate tax collection agency in his
5    or her state of residence. In addition, the retailer must
6    retain a signed copy of the statement in his or her
7    records. Nothing in this item shall be construed to require
8    the removal of the vehicle from this state following the
9    filing of an intent to title the vehicle in the purchaser's
10    state of residence if the purchaser titles the vehicle in
11    his or her state of residence within 30 days after the date
12    of sale. The tax collected under this Act in accordance
13    with this item (25-5) shall be proportionately distributed
14    as if the tax were collected at the 6.25% general rate
15    imposed under this Act.
16        (25-7) Beginning on July 1, 2007, no tax is imposed
17    under this Act on the sale of an aircraft, as defined in
18    Section 3 of the Illinois Aeronautics Act, if all of the
19    following conditions are met:
20            (1) the aircraft leaves this State within 15 days
21        after the later of either the issuance of the final
22        billing for the sale of the aircraft, or the authorized
23        approval for return to service, completion of the
24        maintenance record entry, and completion of the test
25        flight and ground test for inspection, as required by
26        14 C.F.R. 91.407;

 

 

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1            (2) the aircraft is not based or registered in this
2        State after the sale of the aircraft; and
3            (3) the seller retains in his or her books and
4        records and provides to the Department a signed and
5        dated certification from the purchaser, on a form
6        prescribed by the Department, certifying that the
7        requirements of this item (25-7) are met. The
8        certificate must also include the name and address of
9        the purchaser, the address of the location where the
10        aircraft is to be titled or registered, the address of
11        the primary physical location of the aircraft, and
12        other information that the Department may reasonably
13        require.
14        For purposes of this item (25-7):
15        "Based in this State" means hangared, stored, or
16    otherwise used, excluding post-sale customizations as
17    defined in this Section, for 10 or more days in each
18    12-month period immediately following the date of the sale
19    of the aircraft.
20        "Registered in this State" means an aircraft
21    registered with the Department of Transportation,
22    Aeronautics Division, or titled or registered with the
23    Federal Aviation Administration to an address located in
24    this State.
25        This paragraph (25-7) is exempt from the provisions of
26    Section 2-70.

 

 

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1        (26) Semen used for artificial insemination of
2    livestock for direct agricultural production.
3        (27) Horses, or interests in horses, registered with
4    and meeting the requirements of any of the Arabian Horse
5    Club Registry of America, Appaloosa Horse Club, American
6    Quarter Horse Association, United States Trotting
7    Association, or Jockey Club, as appropriate, used for
8    purposes of breeding or racing for prizes. This item (27)
9    is exempt from the provisions of Section 2-70, and the
10    exemption provided for under this item (27) applies for all
11    periods beginning May 30, 1995, but no claim for credit or
12    refund is allowed on or after January 1, 2008 (the
13    effective date of Public Act 95-88) for such taxes paid
14    during the period beginning May 30, 2000 and ending on
15    January 1, 2008 (the effective date of Public Act 95-88).
16        (28) Computers and communications equipment utilized
17    for any hospital purpose and equipment used in the
18    diagnosis, analysis, or treatment of hospital patients
19    sold to a lessor who leases the equipment, under a lease of
20    one year or longer executed or in effect at the time of the
21    purchase, to a hospital that has been issued an active tax
22    exemption identification number by the Department under
23    Section 1g of this Act.
24        (29) Personal property sold to a lessor who leases the
25    property, under a lease of one year or longer executed or
26    in effect at the time of the purchase, to a governmental

 

 

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

 

 

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1    area within 6 months after the disaster.
2        (32) Beginning July 1, 1999, game or game birds sold at
3    a "game breeding and hunting preserve area" as that term is
4    used in the Wildlife Code. This paragraph is exempt from
5    the provisions of Section 2-70.
6        (33) A motor vehicle, as that term is defined in
7    Section 1-146 of the Illinois Vehicle Code, that is donated
8    to a corporation, limited liability company, society,
9    association, foundation, or institution that is determined
10    by the Department to be organized and operated exclusively
11    for educational purposes. For purposes of this exemption,
12    "a corporation, limited liability company, society,
13    association, foundation, or institution organized and
14    operated exclusively for educational purposes" means all
15    tax-supported public schools, private schools that offer
16    systematic instruction in useful branches of learning by
17    methods common to public schools and that compare favorably
18    in their scope and intensity with the course of study
19    presented in tax-supported schools, and vocational or
20    technical schools or institutes organized and operated
21    exclusively to provide a course of study of not less than 6
22    weeks duration and designed to prepare individuals to
23    follow a trade or to pursue a manual, technical,
24    mechanical, industrial, business, or commercial
25    occupation.
26        (34) Beginning January 1, 2000, personal property,

 

 

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1    including food, purchased through fundraising events for
2    the benefit of a public or private elementary or secondary
3    school, a group of those schools, or one or more school
4    districts if the events are sponsored by an entity
5    recognized by the school district that consists primarily
6    of volunteers and includes parents and teachers of the
7    school children. This paragraph does not apply to
8    fundraising events (i) for the benefit of private home
9    instruction or (ii) for which the fundraising entity
10    purchases the personal property sold at the events from
11    another individual or entity that sold the property for the
12    purpose of resale by the fundraising entity and that
13    profits from the sale to the fundraising entity. This
14    paragraph is exempt from the provisions of Section 2-70.
15        (35) Beginning January 1, 2000 and through December 31,
16    2001, new or used automatic vending machines that prepare
17    and serve hot food and beverages, including coffee, soup,
18    and other items, and replacement parts for these machines.
19    Beginning January 1, 2002 and through June 30, 2003,
20    machines and parts for machines used in commercial,
21    coin-operated amusement and vending business if a use or
22    occupation tax is paid on the gross receipts derived from
23    the use of the commercial, coin-operated amusement and
24    vending machines. This paragraph is exempt from the
25    provisions of Section 2-70.
26        (35-5) Beginning August 23, 2001 and through June 30,

 

 

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1    2016, food for human consumption that is to be consumed off
2    the premises where it is sold (other than alcoholic
3    beverages, soft drinks, and food that has been prepared for
4    immediate consumption) and prescription and
5    nonprescription medicines, drugs, medical appliances, and
6    insulin, urine testing materials, syringes, and needles
7    used by diabetics, for human use, when purchased for use by
8    a person receiving medical assistance under Article V of
9    the Illinois Public Aid Code who resides in a licensed
10    long-term care facility, as defined in the Nursing Home
11    Care Act, or a licensed facility as defined in the ID/DD
12    Community Care Act, the MC/DD Act, or the Specialized
13    Mental Health Rehabilitation Act of 2013.
14        (36) Beginning August 2, 2001, computers and
15    communications equipment utilized for any hospital purpose
16    and equipment used in the diagnosis, analysis, or treatment
17    of hospital patients sold to a lessor who leases the
18    equipment, under a lease of one year or longer executed or
19    in effect at the time of the purchase, to a hospital that
20    has been issued an active tax exemption identification
21    number by the Department under Section 1g of this Act. This
22    paragraph is exempt from the provisions of Section 2-70.
23        (37) Beginning August 2, 2001, personal property sold
24    to a lessor who leases the property, under a lease of one
25    year or longer executed or in effect at the time of the
26    purchase, to a governmental body that has been issued an

 

 

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1    active tax exemption identification number by the
2    Department under Section 1g of this Act. This paragraph is
3    exempt from the provisions of Section 2-70.
4        (38) Beginning on January 1, 2002 and through June 30,
5    2016, tangible personal property purchased from an
6    Illinois retailer by a taxpayer engaged in centralized
7    purchasing activities in Illinois who will, upon receipt of
8    the property in Illinois, temporarily store the property in
9    Illinois (i) for the purpose of subsequently transporting
10    it outside this State for use or consumption thereafter
11    solely outside this State or (ii) for the purpose of being
12    processed, fabricated, or manufactured into, attached to,
13    or incorporated into other tangible personal property to be
14    transported outside this State and thereafter used or
15    consumed solely outside this State. The Director of Revenue
16    shall, pursuant to rules adopted in accordance with the
17    Illinois Administrative Procedure Act, issue a permit to
18    any taxpayer in good standing with the Department who is
19    eligible for the exemption under this paragraph (38). The
20    permit issued under this paragraph (38) shall authorize the
21    holder, to the extent and in the manner specified in the
22    rules adopted under this Act, to purchase tangible personal
23    property from a retailer exempt from the taxes imposed by
24    this Act. Taxpayers shall maintain all necessary books and
25    records to substantiate the use and consumption of all such
26    tangible personal property outside of the State of

 

 

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1    Illinois.
2        (39) Beginning January 1, 2008, tangible personal
3    property used in the construction or maintenance of a
4    community water supply, as defined under Section 3.145 of
5    the Environmental Protection Act, that is operated by a
6    not-for-profit corporation that holds a valid water supply
7    permit issued under Title IV of the Environmental
8    Protection Act. This paragraph is exempt from the
9    provisions of Section 2-70.
10        (40) Beginning January 1, 2010, materials, parts,
11    equipment, components, and furnishings incorporated into
12    or upon an aircraft as part of the modification,
13    refurbishment, completion, replacement, repair, or
14    maintenance of the aircraft. This exemption includes
15    consumable supplies used in the modification,
16    refurbishment, completion, replacement, repair, and
17    maintenance of aircraft, but excludes any materials,
18    parts, equipment, components, and consumable supplies used
19    in the modification, replacement, repair, and maintenance
20    of aircraft engines or power plants, whether such engines
21    or power plants are installed or uninstalled upon any such
22    aircraft. "Consumable supplies" include, but are not
23    limited to, adhesive, tape, sandpaper, general purpose
24    lubricants, cleaning solution, latex gloves, and
25    protective films. This exemption applies only to the sale
26    of qualifying tangible personal property to persons who

 

 

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1    modify, refurbish, complete, replace, or maintain an
2    aircraft and who (i) hold an Air Agency Certificate and are
3    empowered to operate an approved repair station by the
4    Federal Aviation Administration, (ii) have a Class IV
5    Rating, and (iii) conduct operations in accordance with
6    Part 145 of the Federal Aviation Regulations. The exemption
7    does not include aircraft operated by a commercial air
8    carrier providing scheduled passenger air service pursuant
9    to authority issued under Part 121 or Part 129 of the
10    Federal Aviation Regulations. The changes made to this
11    paragraph (40) by Public Act 98-534 are declarative of
12    existing law.
13        (41) Tangible personal property sold to a
14    public-facilities corporation, as described in Section
15    11-65-10 of the Illinois Municipal Code, for purposes of
16    constructing or furnishing a municipal convention hall,
17    but only if the legal title to the municipal convention
18    hall is transferred to the municipality without any further
19    consideration by or on behalf of the municipality at the
20    time of the completion of the municipal convention hall or
21    upon the retirement or redemption of any bonds or other
22    debt instruments issued by the public-facilities
23    corporation in connection with the development of the
24    municipal convention hall. This exemption includes
25    existing public-facilities corporations as provided in
26    Section 11-65-25 of the Illinois Municipal Code. This

 

 

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1    paragraph is exempt from the provisions of Section 2-70.
2        (42) Beginning January 1, 2017, menstrual pads,
3    tampons, and menstrual cups.
4        (43) Merchandise that is subject to the Rental Purchase
5    Agreement Occupation and Use Tax. The purchaser must
6    certify that the item is purchased to be rented subject to
7    a rental purchase agreement, as defined in the Rental
8    Purchase Agreement Act, and provide proof of registration
9    under the Rental Purchase Agreement Occupation and Use Tax
10    Act. This paragraph is exempt from the provisions of
11    Section 2-70.
12        (44) Qualified tangible personal property used in the
13    construction or operation of a data center that has been
14    granted a certificate of exemption by the Department of
15    Commerce and Economic Opportunity, whether that tangible
16    personal property is purchased by the owner, operator, or
17    tenant of the data center or by a contractor or
18    subcontractor of the owner, operator, or tenant. Data
19    centers that would have qualified for a certificate of
20    exemption prior to January 1, 2020 had this amendatory Act
21    of the 101st General Assembly been in effect, may apply for
22    and obtain an exemption for subsequent purchases of
23    computer equipment or enabling software purchased or
24    leased to upgrade, supplement, or replace computer
25    equipment or enabling software purchased or leased in the
26    original investment that would have qualified.

 

 

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1        The Department of Commerce and Economic Opportunity
2    shall grant a certificate of exemption under this item (44)
3    to qualified data centers as defined by Section 605-1025 of
4    the Department of Commerce and Economic Opportunity Law of
5    the Civil Administrative Code of Illinois.
6        For the purposes of this item (44):
7            "Data center" means a building or a series of
8        buildings rehabilitated or constructed to house
9        working servers in one physical location or multiple
10        sites within the State of Illinois.
11            "Qualified tangible personal property" means:
12        electrical systems and equipment; climate control and
13        chilling equipment and systems; mechanical systems and
14        equipment; monitoring and secure systems; emergency
15        generators; hardware; computers; servers; data storage
16        devices; network connectivity equipment; racks;
17        cabinets; telecommunications cabling infrastructure;
18        raised floor systems; peripheral components or
19        systems; software; mechanical, electrical, or plumbing
20        systems; battery systems; cooling systems and towers;
21        temperature control systems; other cabling; and other
22        data center infrastructure equipment and systems
23        necessary to operate qualified tangible personal
24        property, including fixtures; and component parts of
25        any of the foregoing, including installation,
26        maintenance, repair, refurbishment, and replacement of

 

 

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1        qualified tangible personal property to generate,
2        transform, transmit, distribute, or manage electricity
3        necessary to operate qualified tangible personal
4        property; and all other tangible personal property
5        that is essential to the operations of a computer data
6        center. The term "qualified tangible personal
7        property" also includes building materials physically
8        incorporated in to the qualifying data center. To
9        document the exemption allowed under this Section, the
10        retailer must obtain from the purchaser a copy of the
11        certificate of eligibility issued by the Department of
12        Commerce and Economic Opportunity.
13        This item (44) is exempt from the provisions of Section
14    2-70.
15        (45) Beginning July 1, 2020, prescription medicines
16    and medical devices (including, but not limited to,
17    products classified as Class III medical devices by the
18    United States Food and Drug Administration that are used
19    for cancer treatment pursuant to a prescription, as well as
20    any accessories and components related to those devices).
21    This item (45) is exempt from the provisions of Section
22    2-70.
23(Source: P.A. 100-22, eff. 7-6-17; 100-321, eff. 8-24-17;
24100-437, eff. 1-1-18; 100-594, eff. 6-29-18; 100-863, eff.
258-14-18; 100-1171, eff. 1-4-19; 101-31, eff. 6-28-19; 101-81,
26eff. 7-12-19.)
 

 

 

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1    (35 ILCS 120/2-10)
2    Sec. 2-10. Rate of tax. Unless otherwise provided in this
3Section, the tax imposed by this Act is at the rate of 6.25% of
4gross receipts from sales of tangible personal property made in
5the course of business.
6    Beginning on July 1, 2000 and through December 31, 2000,
7with respect to motor fuel, as defined in Section 1.1 of the
8Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
9the Use Tax Act, the tax is imposed at the rate of 1.25%.
10    Beginning on August 6, 2010 through August 15, 2010, with
11respect to sales tax holiday items as defined in Section 2-8 of
12this Act, the tax is imposed at the rate of 1.25%.
13    Within 14 days after the effective date of this amendatory
14Act of the 91st General Assembly, each retailer of motor fuel
15and gasohol shall cause the following notice to be posted in a
16prominently visible place on each retail dispensing device that
17is used to dispense motor fuel or gasohol in the State of
18Illinois: "As of July 1, 2000, the State of Illinois has
19eliminated the State's share of sales tax on motor fuel and
20gasohol through December 31, 2000. The price on this pump
21should reflect the elimination of the tax." The notice shall be
22printed in bold print on a sign that is no smaller than 4
23inches by 8 inches. The sign shall be clearly visible to
24customers. Any retailer who fails to post or maintain a
25required sign through December 31, 2000 is guilty of a petty

 

 

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1offense for which the fine shall be $500 per day per each
2retail premises where a violation occurs.
3    With respect to gasohol, as defined in the Use Tax Act, the
4tax imposed by this Act applies to (i) 70% of the proceeds of
5sales made on or after January 1, 1990, and before July 1,
62003, (ii) 80% of the proceeds of sales made on or after July
71, 2003 and on or before July 1, 2017, and (iii) 100% of the
8proceeds of sales made thereafter. If, at any time, however,
9the tax under this Act on sales of gasohol, as defined in the
10Use Tax Act, is imposed at the rate of 1.25%, then the tax
11imposed by this Act applies to 100% of the proceeds of sales of
12gasohol made during that time.
13    With respect to majority blended ethanol fuel, as defined
14in the Use Tax Act, the tax imposed by this Act does not apply
15to the proceeds of sales made on or after July 1, 2003 and on or
16before December 31, 2023 but applies to 100% of the proceeds of
17sales made thereafter.
18    With respect to biodiesel blends, as defined in the Use Tax
19Act, with no less than 1% and no more than 10% biodiesel, the
20tax imposed by this Act applies to (i) 80% of the proceeds of
21sales made on or after July 1, 2003 and on or before December
2231, 2018 and (ii) 100% of the proceeds of sales made
23thereafter. If, at any time, however, the tax under this Act on
24sales of biodiesel blends, as defined in the Use Tax Act, with
25no less than 1% and no more than 10% biodiesel is imposed at
26the rate of 1.25%, then the tax imposed by this Act applies to

 

 

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1100% of the proceeds of sales of biodiesel blends with no less
2than 1% and no more than 10% biodiesel made during that time.
3    With respect to 100% biodiesel, as defined in the Use Tax
4Act, and biodiesel blends, as defined in the Use Tax Act, with
5more than 10% but no more than 99% biodiesel, the tax imposed
6by this Act does not apply to the proceeds of sales made on or
7after July 1, 2003 and on or before December 31, 2023 but
8applies to 100% of the proceeds of sales made thereafter.
9    With respect to food for human consumption that is to be
10consumed off the premises where it is sold (other than
11alcoholic beverages, food consisting of or infused with adult
12use cannabis, soft drinks, and food that has been prepared for
13immediate consumption) and prescription and nonprescription
14medicines and , drugs, medical appliances, products classified
15as Class III medical devices by the United States Food and Drug
16Administration that are used for cancer treatment pursuant to a
17prescription, as well as any accessories and components related
18to those devices, modifications to a motor vehicle for the
19purpose of rendering it usable by a person with a disability,
20and insulin, urine testing materials, syringes, and needles
21used by diabetics, for human use, the tax is imposed at the
22rate of 1%. For the purposes of this Section, until September
231, 2009: the term "soft drinks" means any complete, finished,
24ready-to-use, non-alcoholic drink, whether carbonated or not,
25including but not limited to soda water, cola, fruit juice,
26vegetable juice, carbonated water, and all other preparations

 

 

SB3296- 98 -LRB101 19659 HLH 69147 b

1commonly known as soft drinks of whatever kind or description
2that are contained in any closed or sealed bottle, can, carton,
3or container, regardless of size; but "soft drinks" does not
4include coffee, tea, non-carbonated water, infant formula,
5milk or milk products as defined in the Grade A Pasteurized
6Milk and Milk Products Act, or drinks containing 50% or more
7natural fruit or vegetable juice.
8    Notwithstanding any other provisions of this Act,
9beginning September 1, 2009, "soft drinks" means non-alcoholic
10beverages that contain natural or artificial sweeteners. "Soft
11drinks" do not include beverages that contain milk or milk
12products, soy, rice or similar milk substitutes, or greater
13than 50% of vegetable or fruit juice by volume.
14    Until August 1, 2009, and notwithstanding any other
15provisions of this Act, "food for human consumption that is to
16be consumed off the premises where it is sold" includes all
17food sold through a vending machine, except soft drinks and
18food products that are dispensed hot from a vending machine,
19regardless of the location of the vending machine. Beginning
20August 1, 2009, and notwithstanding any other provisions of
21this Act, "food for human consumption that is to be consumed
22off the premises where it is sold" includes all food sold
23through a vending machine, except soft drinks, candy, and food
24products that are dispensed hot from a vending machine,
25regardless of the location of the vending machine.
26    Notwithstanding any other provisions of this Act,

 

 

SB3296- 99 -LRB101 19659 HLH 69147 b

1beginning September 1, 2009, "food for human consumption that
2is to be consumed off the premises where it is sold" does not
3include candy. For purposes of this Section, "candy" means a
4preparation of sugar, honey, or other natural or artificial
5sweeteners in combination with chocolate, fruits, nuts or other
6ingredients or flavorings in the form of bars, drops, or
7pieces. "Candy" does not include any preparation that contains
8flour or requires refrigeration.
9    Notwithstanding any other provisions of this Act,
10beginning September 1, 2009, "nonprescription medicines and
11drugs" does not include grooming and hygiene products. For
12purposes of this Section, "grooming and hygiene products"
13includes, but is not limited to, soaps and cleaning solutions,
14shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
15lotions and screens, unless those products are available by
16prescription only, regardless of whether the products meet the
17definition of "over-the-counter-drugs". For the purposes of
18this paragraph, "over-the-counter-drug" means a drug for human
19use that contains a label that identifies the product as a drug
20as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
21label includes:
22        (A) A "Drug Facts" panel; or
23        (B) A statement of the "active ingredient(s)" with a
24    list of those ingredients contained in the compound,
25    substance or preparation.
26    Beginning on the effective date of this amendatory Act of

 

 

SB3296- 100 -LRB101 19659 HLH 69147 b

1the 98th General Assembly, "prescription and nonprescription
2medicines and drugs" includes medical cannabis purchased from a
3registered dispensing organization under the Compassionate Use
4of Medical Cannabis Program Act.
5    As used in this Section, "adult use cannabis" means
6cannabis subject to tax under the Cannabis Cultivation
7Privilege Tax Law and the Cannabis Purchaser Excise Tax Law and
8does not include cannabis subject to tax under the
9Compassionate Use of Medical Cannabis Program Act.
10(Source: P.A. 100-22, eff. 7-6-17; 101-363, eff. 8-9-19;
11101-593, eff. 12-4-19.)
 
12    Section 99. Effective date. This Act takes effect July 1,
132020.