103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB3059

 

Introduced 2/17/2023, by Rep. Dave Vella

 

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

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that diapers are exempt from the taxes imposed under the Acts. Effective immediately.


LRB103 27006 HLH 53373 b

 

 

A BILL FOR

 

HB3059LRB103 27006 HLH 53373 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Section
53-5 as follows:
 
6    (35 ILCS 105/3-5)
7    Sec. 3-5. Exemptions. Use of the following tangible
8personal property is exempt from the tax imposed by this Act:
9    (1) Personal property purchased from a corporation,
10society, association, foundation, institution, or
11organization, other than a limited liability company, that is
12organized and operated as a not-for-profit service enterprise
13for the benefit of persons 65 years of age or older if the
14personal property was not purchased by the enterprise for the
15purpose of resale by the enterprise.
16    (2) Personal property purchased by a not-for-profit
17Illinois county fair association for use in conducting,
18operating, or promoting the county fair.
19    (3) Personal property purchased by a not-for-profit arts
20or cultural organization that establishes, by proof required
21by the Department by rule, that it has received an exemption
22under Section 501(c)(3) of the Internal Revenue Code and that
23is organized 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
24exemption identification 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
5and used, 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
11a graphic arts product. Beginning on July 1, 2017, graphic
12arts machinery and equipment is included in the manufacturing
13and assembling machinery and equipment exemption under
14paragraph (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
9to be registered under Section 3-809 of the Illinois Vehicle
10Code, but excluding other motor vehicles required to be
11registered under the Illinois Vehicle Code. Horticultural
12polyhouses or hoop houses used for propagating, growing, or
13overwintering plants shall be considered farm machinery and
14equipment under this item (11). Agricultural chemical tender
15tanks and dry boxes shall include units sold separately from a
16motor vehicle required to be licensed and units sold mounted
17on a motor vehicle required to be licensed if the selling price
18of the tender 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
12conduct of its business as an air common carrier, for a flight
13destined for or returning from a location or locations outside
14the United States without regard to previous or subsequent
15domestic stopovers.
16    Beginning July 1, 2013, fuel and petroleum products sold
17to or used by an air carrier, certified by the carrier to be
18used for consumption, shipment, or storage in the conduct of
19its business 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
22at least 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
10rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
11pipe and tubular goods, including casing and drill strings,
12(iii) pumps and pump-jack units, (iv) storage tanks and flow
13lines, (v) any individual replacement part for oil field
14exploration, drilling, and production equipment, and (vi)
15machinery and equipment purchased for lease; but excluding
16motor vehicles required to be registered under the Illinois
17Vehicle Code.
18    (15) Photoprocessing machinery and equipment, including
19repair and replacement parts, both new and used, including
20that manufactured on special order, certified by the purchaser
21to be used primarily for photoprocessing, and including
22photoprocessing machinery and equipment purchased for lease.
23    (16) Until July 1, 2028, 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

 

 

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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    (17) Until July 1, 2003, distillation machinery and
9equipment, sold as a unit or kit, assembled or installed by the
10retailer, certified by the user to be used only for the
11production of ethyl alcohol that will be used for consumption
12as motor fuel or as a component of motor fuel for the personal
13use of the user, and not subject to sale or resale.
14    (18) Manufacturing and assembling machinery and equipment
15used primarily in the process of manufacturing or assembling
16tangible personal property for wholesale or retail sale or
17lease, whether that sale or lease is made directly by the
18manufacturer or by some other person, whether the materials
19used in the process are owned by the manufacturer or some other
20person, or whether that sale or lease is made apart from or as
21an incident to the seller's engaging in the service occupation
22of producing machines, tools, dies, jigs, patterns, gauges, or
23other similar items of no commercial value on special order
24for a particular purchaser. The exemption provided by this
25paragraph (18) includes production related tangible personal
26property, as defined in Section 3-50, purchased on or after

 

 

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1July 1, 2019. The exemption provided by this paragraph (18)
2does not include machinery and equipment used in (i) the
3generation of electricity for wholesale or retail sale; (ii)
4the generation or treatment of natural or artificial gas for
5wholesale or retail sale that is delivered to customers
6through pipes, pipelines, or mains; or (iii) the treatment of
7water for wholesale or retail sale that is delivered to
8customers through pipes, pipelines, or mains. The provisions
9of Public Act 98-583 are declaratory of existing law as to the
10meaning and scope of this exemption. Beginning on July 1,
112017, the exemption provided by this paragraph (18) includes,
12but is not limited to, graphic arts machinery and equipment,
13as defined in paragraph (6) of this Section.
14    (19) Personal property delivered to a purchaser or
15purchaser's donee inside Illinois when the purchase order for
16that personal property was received by a florist located
17outside Illinois who has a florist located inside Illinois
18deliver the personal property.
19    (20) Semen used for artificial insemination of livestock
20for direct agricultural production.
21    (21) Horses, or interests in horses, registered with and
22meeting the requirements of any of the Arabian Horse Club
23Registry of America, Appaloosa Horse Club, American Quarter
24Horse Association, United States Trotting Association, or
25Jockey Club, as appropriate, used for purposes of breeding or
26racing for prizes. This item (21) is exempt from the

 

 

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1provisions of Section 3-90, and the exemption provided for
2under this item (21) applies for all periods beginning May 30,
31995, but no claim for credit or refund is allowed on or after
4January 1, 2008 for such taxes paid during the period
5beginning May 30, 2000 and ending on January 1, 2008.
6    (22) Computers and communications equipment utilized for
7any hospital purpose and equipment used in the diagnosis,
8analysis, or treatment of hospital patients purchased by a
9lessor who leases the equipment, under a lease of one year or
10longer executed or in effect at the time the lessor would
11otherwise be subject to the tax imposed by this Act, to a
12hospital that has been issued an active tax exemption
13identification number by the Department under Section 1g of
14the Retailers' Occupation Tax Act. If the equipment is leased
15in a manner that does not qualify for this exemption or is used
16in any other non-exempt manner, the lessor shall be liable for
17the tax imposed under this Act or the Service Use Tax Act, as
18the case may be, based on the fair market value of the property
19at the time the non-qualifying use occurs. No lessor shall
20collect or attempt to collect an amount (however designated)
21that purports to reimburse that lessor for the tax imposed by
22this Act or the Service Use Tax Act, as the case may be, if the
23tax has not been paid by the lessor. If a lessor improperly
24collects any such amount from the lessee, the lessee shall
25have a legal right to claim a refund of that amount from the
26lessor. If, however, that amount is not refunded to the lessee

 

 

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

 

 

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1for disaster relief to be used in a State or federally declared
2disaster area in Illinois or bordering Illinois by a
3manufacturer or retailer that is registered in this State to a
4corporation, society, association, foundation, or institution
5that has been issued a sales tax exemption identification
6number by the Department that assists victims of the disaster
7who reside within the declared disaster area.
8    (25) Beginning with taxable years ending on or after
9December 31, 1995 and ending with taxable years ending on or
10before December 31, 2004, personal property that is used in
11the performance of infrastructure repairs in this State,
12including but not limited to municipal roads and streets,
13access roads, bridges, sidewalks, waste disposal systems,
14water and sewer line extensions, water distribution and
15purification facilities, storm water drainage and retention
16facilities, and sewage treatment facilities, resulting from a
17State or federally declared disaster in Illinois or bordering
18Illinois when such repairs are initiated on facilities located
19in the declared disaster area within 6 months after the
20disaster.
21    (26) Beginning July 1, 1999, game or game birds purchased
22at a "game breeding and hunting preserve area" as that term is
23used in the Wildlife Code. This paragraph is exempt from the
24provisions of Section 3-90.
25    (27) A motor vehicle, as that term is defined in Section
261-146 of the Illinois Vehicle Code, that is donated to a

 

 

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

 

 

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1entity purchases the personal property sold at the events from
2another individual or entity that sold the property for the
3purpose of resale by the fundraising entity and that profits
4from the sale to the fundraising entity. This paragraph is
5exempt from the provisions of Section 3-90.
6    (29) Beginning January 1, 2000 and through December 31,
72001, new or used automatic vending machines that prepare and
8serve hot food and beverages, including coffee, soup, and
9other items, and replacement parts for these machines.
10Beginning January 1, 2002 and through June 30, 2003, machines
11and parts for machines used in commercial, coin-operated
12amusement and vending business if a use or occupation tax is
13paid on the gross receipts derived from the use of the
14commercial, coin-operated amusement and vending machines. This
15paragraph is exempt from the provisions of Section 3-90.
16    (30) Beginning January 1, 2001 and through June 30, 2016,
17food for human consumption that is to be consumed off the
18premises where it is sold (other than alcoholic beverages,
19soft drinks, and food that has been prepared for immediate
20consumption) and prescription and nonprescription medicines,
21drugs, medical appliances, and insulin, urine testing
22materials, syringes, and needles used by diabetics, for human
23use, when purchased for use by a person receiving medical
24assistance under Article V of the Illinois Public Aid Code who
25resides in a licensed long-term care facility, as defined in
26the Nursing Home Care Act, or in a licensed facility as defined

 

 

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1in the ID/DD Community Care Act, the MC/DD Act, or the
2Specialized Mental Health Rehabilitation Act of 2013.
3    (31) Beginning on August 2, 2001 (the effective date of
4Public Act 92-227), computers and communications equipment
5utilized for any hospital purpose and equipment used in the
6diagnosis, analysis, or treatment of hospital patients
7purchased by a lessor who leases the equipment, under a lease
8of one year or longer executed or in effect at the time the
9lessor would otherwise be subject to the tax imposed by this
10Act, to a hospital that has been issued an active tax exemption
11identification number by the Department under Section 1g of
12the Retailers' Occupation Tax Act. If the equipment is leased
13in a manner that does not qualify for this exemption or is used
14in any other nonexempt manner, the lessor shall be liable for
15the tax imposed under this Act or the Service Use Tax Act, as
16the case may be, based on the fair market value of the property
17at the time the nonqualifying use occurs. No lessor shall
18collect or attempt to collect an amount (however designated)
19that purports to reimburse that lessor for the tax imposed by
20this Act or the Service Use Tax Act, as the case may be, if the
21tax has not been paid by the lessor. If a lessor improperly
22collects any such amount from the lessee, the lessee shall
23have a legal right to claim a refund of that amount from the
24lessor. If, however, that amount is not refunded to the lessee
25for any reason, the lessor is liable to pay that amount to the
26Department. This paragraph is exempt from the provisions of

 

 

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1Section 3-90.
2    (32) Beginning on August 2, 2001 (the effective date of
3Public Act 92-227), personal property purchased by a lessor
4who leases the property, under a lease of one year or longer
5executed or in effect at the time the lessor would otherwise be
6subject to the tax imposed by this Act, to a governmental body
7that has been issued an active sales tax exemption
8identification number by the Department under Section 1g of
9the Retailers' Occupation Tax Act. If the property is leased
10in a manner that does not qualify for this exemption or used in
11any other nonexempt manner, the lessor shall be liable for the
12tax imposed under this Act or the Service Use Tax Act, as the
13case may be, based on the fair market value of the property at
14the time the nonqualifying use occurs. No lessor shall collect
15or attempt to collect an amount (however designated) that
16purports to reimburse that lessor for the tax imposed by this
17Act or the Service Use Tax Act, as the case may be, if the tax
18has not been paid by the lessor. If a lessor improperly
19collects any such amount from the lessee, the lessee shall
20have a legal right to claim a refund of that amount from the
21lessor. If, however, that amount is not refunded to the lessee
22for any reason, the lessor is liable to pay that amount to the
23Department. This paragraph is exempt from the provisions of
24Section 3-90.
25    (33) On and after July 1, 2003 and through June 30, 2004,
26the use in this State of motor vehicles of the second division

 

 

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1with a gross vehicle weight in excess of 8,000 pounds and that
2are subject to the commercial distribution fee imposed under
3Section 3-815.1 of the Illinois Vehicle Code. Beginning on
4July 1, 2004 and through June 30, 2005, the use in this State
5of motor vehicles of the second division: (i) with a gross
6vehicle weight rating in excess of 8,000 pounds; (ii) that are
7subject to the commercial distribution fee imposed under
8Section 3-815.1 of the Illinois Vehicle Code; and (iii) that
9are primarily used for commercial purposes. Through June 30,
102005, this exemption applies to repair and replacement parts
11added after the initial purchase of such a motor vehicle if
12that motor vehicle is used in a manner that would qualify for
13the rolling stock exemption otherwise provided for in this
14Act. For purposes of this paragraph, the term "used for
15commercial purposes" means the transportation of persons or
16property in furtherance of any commercial or industrial
17enterprise, whether for-hire or not.
18    (34) Beginning January 1, 2008, tangible personal property
19used in the construction or maintenance of a community water
20supply, as defined under Section 3.145 of the Environmental
21Protection Act, that is operated by a not-for-profit
22corporation that holds a valid water supply permit issued
23under Title IV of the Environmental Protection Act. This
24paragraph is exempt from the provisions of Section 3-90.
25    (35) Beginning January 1, 2010 and continuing through
26December 31, 2024, materials, parts, equipment, components,

 

 

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1and furnishings incorporated into or upon an aircraft as part
2of the modification, refurbishment, completion, replacement,
3repair, or maintenance of the aircraft. This exemption
4includes consumable supplies used in the modification,
5refurbishment, completion, replacement, repair, and
6maintenance of aircraft, but excludes any materials, parts,
7equipment, components, and consumable supplies used in the
8modification, replacement, repair, and maintenance of aircraft
9engines or power plants, whether such engines or power plants
10are installed or uninstalled upon any such aircraft.
11"Consumable supplies" include, but are not limited to,
12adhesive, tape, sandpaper, general purpose lubricants,
13cleaning solution, latex gloves, and protective films. This
14exemption applies only to the use of qualifying tangible
15personal property by persons who modify, refurbish, complete,
16repair, replace, or maintain aircraft and who (i) hold an Air
17Agency Certificate and are empowered to operate an approved
18repair station by the Federal Aviation Administration, (ii)
19have a Class IV Rating, and (iii) conduct operations in
20accordance with Part 145 of the Federal Aviation Regulations.
21The exemption does not include aircraft operated by a
22commercial air carrier providing scheduled passenger air
23service pursuant to authority issued under Part 121 or Part
24129 of the Federal Aviation Regulations. The changes made to
25this paragraph (35) by Public Act 98-534 are declarative of
26existing law. It is the intent of the General Assembly that the

 

 

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1exemption under this paragraph (35) applies continuously from
2January 1, 2010 through December 31, 2024; however, no claim
3for credit or refund is allowed for taxes paid as a result of
4the disallowance of this exemption on or after January 1, 2015
5and prior to February 5, 2020 (the effective date of Public Act
6101-629) this amendatory Act of the 101st General Assembly.
7    (36) Tangible personal property purchased by a
8public-facilities corporation, as described in Section
911-65-10 of the Illinois Municipal Code, for purposes of
10constructing or furnishing a municipal convention hall, but
11only if the legal title to the municipal convention hall is
12transferred to the municipality without any further
13consideration by or on behalf of the municipality at the time
14of the completion of the municipal convention hall or upon the
15retirement or redemption of any bonds or other debt
16instruments issued by the public-facilities corporation in
17connection with the development of the municipal convention
18hall. This exemption includes existing public-facilities
19corporations as provided in Section 11-65-25 of the Illinois
20Municipal Code. This paragraph is exempt from the provisions
21of Section 3-90.
22    (37) Beginning January 1, 2017 and through December 31,
232026, menstrual pads, tampons, and menstrual cups.
24    (38) Merchandise that is subject to the Rental Purchase
25Agreement Occupation and Use Tax. The purchaser must certify
26that the item is purchased to be rented subject to a rental

 

 

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1purchase agreement, as defined in the Rental Purchase
2Agreement Act, and provide proof of registration under the
3Rental Purchase Agreement Occupation and Use Tax Act. This
4paragraph is exempt from the provisions of Section 3-90.
5    (39) Tangible personal property purchased by a purchaser
6who is exempt from the tax imposed by this Act by operation of
7federal law. This paragraph is exempt from the provisions of
8Section 3-90.
9    (40) Qualified tangible personal property used in the
10construction or operation of a data center that has been
11granted a certificate of exemption by the Department of
12Commerce and Economic Opportunity, whether that tangible
13personal property is purchased by the owner, operator, or
14tenant of the data center or by a contractor or subcontractor
15of the owner, operator, or tenant. Data centers that would
16have qualified for a certificate of exemption prior to January
171, 2020 had Public Act 101-31 been in effect may apply for and
18obtain an exemption for subsequent purchases of computer
19equipment or enabling software purchased or leased to upgrade,
20supplement, or replace computer equipment or enabling software
21purchased or leased in the original investment that would have
22qualified.
23    The Department of Commerce and Economic Opportunity shall
24grant a certificate of exemption under this item (40) to
25qualified data centers as defined by Section 605-1025 of the
26Department of Commerce and Economic Opportunity Law of the

 

 

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1Civil Administrative Code of Illinois.
2    For the purposes of this item (40):
3        "Data center" means a building or a series of
4    buildings rehabilitated or constructed to house working
5    servers in one physical location or multiple sites within
6    the State of Illinois.
7        "Qualified tangible personal property" means:
8    electrical systems and equipment; climate control and
9    chilling equipment and systems; mechanical systems and
10    equipment; monitoring and secure systems; emergency
11    generators; hardware; computers; servers; data storage
12    devices; network connectivity equipment; racks; cabinets;
13    telecommunications cabling infrastructure; raised floor
14    systems; peripheral components or systems; software;
15    mechanical, electrical, or plumbing systems; battery
16    systems; cooling systems and towers; temperature control
17    systems; other cabling; and other data center
18    infrastructure equipment and systems necessary to operate
19    qualified tangible personal property, including fixtures;
20    and component parts of any of the foregoing, including
21    installation, maintenance, repair, refurbishment, and
22    replacement of qualified tangible personal property to
23    generate, transform, transmit, distribute, or manage
24    electricity necessary to operate qualified tangible
25    personal property; and all other tangible personal
26    property that is essential to the operations of a computer

 

 

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1    data center. The term "qualified tangible personal
2    property" also includes building materials physically
3    incorporated in to the qualifying data center. To document
4    the exemption allowed under this Section, the retailer
5    must obtain from the purchaser a copy of the certificate
6    of eligibility issued by the Department of Commerce and
7    Economic Opportunity.
8    This item (40) is exempt from the provisions of Section
93-90.
10    (41) Beginning July 1, 2022, breast pumps, breast pump
11collection and storage supplies, and breast pump kits. This
12item (41) is exempt from the provisions of Section 3-90. As
13used in this item (41):
14        "Breast pump" means an electrically controlled or
15    manually controlled pump device designed or marketed to be
16    used to express milk from a human breast during lactation,
17    including the pump device and any battery, AC adapter, or
18    other power supply unit that is used to power the pump
19    device and is packaged and sold with the pump device at the
20    time of sale.
21        "Breast pump collection and storage supplies" means
22    items of tangible personal property designed or marketed
23    to be used in conjunction with a breast pump to collect
24    milk expressed from a human breast and to store collected
25    milk until it is ready for consumption.
26        "Breast pump collection and storage supplies"

 

 

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1    includes, but is not limited to: breast shields and breast
2    shield connectors; breast pump tubes and tubing adapters;
3    breast pump valves and membranes; backflow protectors and
4    backflow protector adaptors; bottles and bottle caps
5    specific to the operation of the breast pump; and breast
6    milk storage bags.
7        "Breast pump collection and storage supplies" does not
8    include: (1) bottles and bottle caps not specific to the
9    operation of the breast pump; (2) breast pump travel bags
10    and other similar carrying accessories, including ice
11    packs, labels, and other similar products; (3) breast pump
12    cleaning supplies; (4) nursing bras, bra pads, breast
13    shells, and other similar products; and (5) creams,
14    ointments, and other similar products that relieve
15    breastfeeding-related symptoms or conditions of the
16    breasts or nipples, unless sold as part of a breast pump
17    kit that is pre-packaged by the breast pump manufacturer
18    or distributor.
19        "Breast pump kit" means a kit that: (1) contains no
20    more than a breast pump, breast pump collection and
21    storage supplies, a rechargeable battery for operating the
22    breast pump, a breastmilk cooler, bottle stands, ice
23    packs, and a breast pump carrying case; and (2) is
24    pre-packaged as a breast pump kit by the breast pump
25    manufacturer or distributor.
26    (42) (41) Tangible personal property sold by or on behalf

 

 

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1of the State Treasurer pursuant to the Revised Uniform
2Unclaimed Property Act. This item (42) (41) is exempt from the
3provisions of Section 3-90.
4    (43) Beginning July 1, 2023, diapers. This item (43) is
5exempt from the provisions of Section 3-90.
6(Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 6-28-19;
7101-81, eff. 7-12-19; 101-629, eff. 2-5-20; 102-16, eff.
86-17-21; 102-700, Article 70, Section 70-5, eff. 4-19-22;
9102-700, Article 75, Section 75-5, eff. 4-19-22; 102-1026,
10eff. 5-27-22; revised 8-1-22.)
 
11    Section 10. The Service Use Tax Act is amended by changing
12Section 3-5 as follows:
 
13    (35 ILCS 110/3-5)
14    Sec. 3-5. Exemptions. Use of the following tangible
15personal property is exempt from the tax imposed by this Act:
16    (1) Personal property purchased from a corporation,
17society, association, foundation, institution, or
18organization, other than a limited liability company, that is
19organized and operated as a not-for-profit service enterprise
20for the benefit of persons 65 years of age or older if the
21personal property was not purchased by the enterprise for the
22purpose of resale by the enterprise.
23    (2) Personal property purchased by a non-profit Illinois
24county fair association for use in conducting, operating, or

 

 

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1promoting the county fair.
2    (3) Personal property purchased by a not-for-profit arts
3or cultural organization that establishes, by proof required
4by the Department by rule, that it has received an exemption
5under Section 501(c)(3) of the Internal Revenue Code and that
6is organized and operated primarily for the presentation or
7support of arts or cultural programming, activities, or
8services. These organizations include, but are not limited to,
9music and dramatic arts organizations such as symphony
10orchestras and theatrical groups, arts and cultural service
11organizations, local arts councils, visual arts organizations,
12and media arts organizations. On and after July 1, 2001 (the
13effective date of Public Act 92-35), however, an entity
14otherwise eligible for this exemption shall not make tax-free
15purchases unless it has an active identification number issued
16by the Department.
17    (4) Legal tender, currency, medallions, or gold or silver
18coinage issued by the State of Illinois, the government of the
19United States of America, or the government of any foreign
20country, and bullion.
21    (5) Until July 1, 2003 and beginning again on September 1,
222004 through August 30, 2014, graphic arts machinery and
23equipment, including repair and replacement parts, both new
24and used, and including that manufactured on special order or
25purchased for lease, certified by the purchaser to be used
26primarily for graphic arts production. Equipment includes

 

 

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

 

 

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

 

 

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

 

 

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1motor vehicles required to be registered under the Illinois
2Vehicle Code.
3    (11) Proceeds from the sale of photoprocessing machinery
4and equipment, including repair and replacement parts, both
5new and used, including that manufactured on special order,
6certified by the purchaser to be used primarily for
7photoprocessing, and including photoprocessing machinery and
8equipment purchased for lease.
9    (12) Until July 1, 2028, coal and aggregate exploration,
10mining, off-highway hauling, processing, maintenance, and
11reclamation equipment, including replacement parts and
12equipment, and including equipment purchased for lease, but
13excluding motor vehicles required to be registered under the
14Illinois Vehicle Code. The changes made to this Section by
15Public Act 97-767 apply on and after July 1, 2003, but no claim
16for credit or refund is allowed on or after August 16, 2013
17(the effective date of Public Act 98-456) for such taxes paid
18during the period beginning July 1, 2003 and ending on August
1916, 2013 (the effective date of Public Act 98-456).
20    (13) Semen used for artificial insemination of livestock
21for direct agricultural production.
22    (14) Horses, or interests in horses, registered with and
23meeting the requirements of any of the Arabian Horse Club
24Registry of America, Appaloosa Horse Club, American Quarter
25Horse Association, United States Trotting Association, or
26Jockey Club, as appropriate, used for purposes of breeding or

 

 

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1racing for prizes. This item (14) is exempt from the
2provisions of Section 3-75, and the exemption provided for
3under this item (14) applies for all periods beginning May 30,
41995, but no claim for credit or refund is allowed on or after
5January 1, 2008 (the effective date of Public Act 95-88) for
6such taxes paid during the period beginning May 30, 2000 and
7ending on January 1, 2008 (the effective date of Public Act
895-88).
9    (15) Computers and communications equipment utilized for
10any hospital purpose and equipment used in the diagnosis,
11analysis, or treatment of hospital patients purchased by a
12lessor who leases the equipment, under a lease of one year or
13longer executed or in effect at the time the lessor would
14otherwise be subject to the tax imposed by this Act, to a
15hospital that has been issued an active tax exemption
16identification number by the Department under Section 1g of
17the Retailers' Occupation Tax Act. If the equipment is leased
18in a manner that does not qualify for this exemption or is used
19in any other non-exempt manner, the lessor shall be liable for
20the tax imposed under this Act or the Use Tax Act, as the case
21may be, based on the fair market value of the property at the
22time the non-qualifying use occurs. No lessor shall collect or
23attempt to collect an amount (however designated) that
24purports to reimburse that lessor for the tax imposed by this
25Act or the Use Tax Act, as the case may be, if the tax has not
26been paid by the lessor. If a lessor improperly collects any

 

 

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

 

 

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

 

 

HB3059- 32 -LRB103 27006 HLH 53373 b

1    (20) A motor vehicle, as that term is defined in Section
21-146 of the Illinois Vehicle Code, that is donated to a
3corporation, limited liability company, society, association,
4foundation, or institution that is determined by the
5Department to be organized and operated exclusively for
6educational purposes. For purposes of this exemption, "a
7corporation, limited liability company, society, association,
8foundation, or institution organized and operated exclusively
9for educational purposes" means all tax-supported public
10schools, private schools that offer systematic instruction in
11useful branches of learning by methods common to public
12schools and that compare favorably in their scope and
13intensity with the course of study presented in tax-supported
14schools, and vocational or technical schools or institutes
15organized and operated exclusively to provide a course of
16study of not less than 6 weeks duration and designed to prepare
17individuals to follow a trade or to pursue a manual,
18technical, mechanical, industrial, business, or commercial
19occupation.
20    (21) Beginning January 1, 2000, personal property,
21including food, purchased through fundraising events for the
22benefit of a public or private elementary or secondary school,
23a group of those schools, or one or more school districts if
24the events are sponsored by an entity recognized by the school
25district that consists primarily of volunteers and includes
26parents and teachers of the school children. This paragraph

 

 

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1does not apply to fundraising events (i) for the benefit of
2private home instruction or (ii) for which the fundraising
3entity purchases the personal property sold at the events from
4another individual or entity that sold the property for the
5purpose of resale by the fundraising entity and that profits
6from the sale to the fundraising entity. This paragraph is
7exempt from the provisions of Section 3-75.
8    (22) Beginning January 1, 2000 and through December 31,
92001, new or used automatic vending machines that prepare and
10serve hot food and beverages, including coffee, soup, and
11other items, and replacement parts for these machines.
12Beginning January 1, 2002 and through June 30, 2003, machines
13and parts for machines used in commercial, coin-operated
14amusement and vending business if a use or occupation tax is
15paid on the gross receipts derived from the use of the
16commercial, coin-operated amusement and vending machines. This
17paragraph is exempt from the provisions of Section 3-75.
18    (23) Beginning August 23, 2001 and through June 30, 2016,
19food for human consumption that is to be consumed off the
20premises where it is sold (other than alcoholic beverages,
21soft drinks, and food that has been prepared for immediate
22consumption) and prescription and nonprescription medicines,
23drugs, medical appliances, and insulin, urine testing
24materials, syringes, and needles used by diabetics, for human
25use, when purchased for use by a person receiving medical
26assistance under Article V of the Illinois Public Aid Code who

 

 

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1resides in a licensed long-term care facility, as defined in
2the Nursing Home Care Act, or in a licensed facility as defined
3in the ID/DD Community Care Act, the MC/DD Act, or the
4Specialized Mental Health Rehabilitation Act of 2013.
5    (24) Beginning on August 2, 2001 (the effective date of
6Public Act 92-227), computers and communications equipment
7utilized for any hospital purpose and equipment used in the
8diagnosis, analysis, or treatment of hospital patients
9purchased by a lessor who leases the equipment, under a lease
10of one year or longer executed or in effect at the time the
11lessor would otherwise be subject to the tax imposed by this
12Act, to a hospital that has been issued an active tax exemption
13identification number by the Department under Section 1g of
14the Retailers' Occupation Tax Act. If the equipment is leased
15in a manner that does not qualify for this exemption or is used
16in any other nonexempt manner, the lessor shall be liable for
17the tax imposed under this Act or the Use Tax Act, as the case
18may be, based on the fair market value of the property at the
19time the nonqualifying use occurs. No lessor shall collect or
20attempt to collect an amount (however designated) that
21purports to reimburse that lessor for the tax imposed by this
22Act or the Use Tax Act, as the case may be, if the tax has not
23been paid by the lessor. If a lessor improperly collects any
24such amount from the lessee, the lessee shall have a legal
25right to claim a refund of that amount from the lessor. If,
26however, that amount is not refunded to the lessee for any

 

 

HB3059- 35 -LRB103 27006 HLH 53373 b

1reason, the lessor is liable to pay that amount to the
2Department. This paragraph is exempt from the provisions of
3Section 3-75.
4    (25) Beginning on August 2, 2001 (the effective date of
5Public Act 92-227), personal property purchased by a lessor
6who leases the property, under a lease of one year or longer
7executed or in effect at the time the lessor would otherwise be
8subject to the tax imposed by this Act, to a governmental body
9that has been issued an active tax exemption identification
10number by the Department under Section 1g of the Retailers'
11Occupation Tax Act. If the property is leased in a manner that
12does not qualify for this exemption or is used in any other
13nonexempt manner, the lessor shall be liable for the tax
14imposed under this Act or the Use Tax Act, as the case may be,
15based on the fair market value of the property at the time the
16nonqualifying use occurs. No lessor shall collect or attempt
17to collect an amount (however designated) that purports to
18reimburse that lessor for the tax imposed by this Act or the
19Use Tax Act, as the case may be, if the tax has not been paid
20by the lessor. If a lessor improperly collects any such amount
21from the lessee, the lessee shall have a legal right to claim a
22refund of that amount from the lessor. If, however, that
23amount is not refunded to the lessee for any reason, the lessor
24is liable to pay that amount to the Department. This paragraph
25is exempt from the provisions of Section 3-75.
26    (26) Beginning January 1, 2008, tangible personal property

 

 

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1used in the construction or maintenance of a community water
2supply, as defined under Section 3.145 of the Environmental
3Protection Act, that is operated by a not-for-profit
4corporation that holds a valid water supply permit issued
5under Title IV of the Environmental Protection Act. This
6paragraph is exempt from the provisions of Section 3-75.
7    (27) Beginning January 1, 2010 and continuing through
8December 31, 2024, materials, parts, equipment, components,
9and furnishings incorporated into or upon an aircraft as part
10of the modification, refurbishment, completion, replacement,
11repair, or maintenance of the aircraft. This exemption
12includes consumable supplies used in the modification,
13refurbishment, completion, replacement, repair, and
14maintenance of aircraft, but excludes any materials, parts,
15equipment, components, and consumable supplies used in the
16modification, replacement, repair, and maintenance of aircraft
17engines or power plants, whether such engines or power plants
18are installed or uninstalled upon any such aircraft.
19"Consumable supplies" include, but are not limited to,
20adhesive, tape, sandpaper, general purpose lubricants,
21cleaning solution, latex gloves, and protective films. This
22exemption applies only to the use of qualifying tangible
23personal property transferred incident to the modification,
24refurbishment, completion, replacement, repair, or maintenance
25of aircraft by persons who (i) hold an Air Agency Certificate
26and are empowered to operate an approved repair station by the

 

 

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1Federal Aviation Administration, (ii) have a Class IV Rating,
2and (iii) conduct operations in accordance with Part 145 of
3the Federal Aviation Regulations. The exemption does not
4include aircraft operated by a commercial air carrier
5providing scheduled passenger air service pursuant to
6authority issued under Part 121 or Part 129 of the Federal
7Aviation Regulations. The changes made to this paragraph (27)
8by Public Act 98-534 are declarative of existing law. It is the
9intent of the General Assembly that the exemption under this
10paragraph (27) applies continuously from January 1, 2010
11through December 31, 2024; however, no claim for credit or
12refund is allowed for taxes paid as a result of the
13disallowance of this exemption on or after January 1, 2015 and
14prior to February 5, 2020 (the effective date of Public Act
15101-629) this amendatory Act of the 101st General Assembly.
16    (28) Tangible personal property purchased by a
17public-facilities corporation, as described in Section
1811-65-10 of the Illinois Municipal Code, for purposes of
19constructing or furnishing a municipal convention hall, but
20only if the legal title to the municipal convention hall is
21transferred to the municipality without any further
22consideration by or on behalf of the municipality at the time
23of the completion of the municipal convention hall or upon the
24retirement or redemption of any bonds or other debt
25instruments issued by the public-facilities corporation in
26connection with the development of the municipal convention

 

 

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1hall. This exemption includes existing public-facilities
2corporations as provided in Section 11-65-25 of the Illinois
3Municipal Code. This paragraph is exempt from the provisions
4of Section 3-75.
5    (29) Beginning January 1, 2017 and through December 31,
62026, menstrual pads, tampons, and menstrual cups.
7    (30) Tangible personal property transferred to a purchaser
8who is exempt from the tax imposed by this Act by operation of
9federal law. This paragraph is exempt from the provisions of
10Section 3-75.
11    (31) Qualified tangible personal property used in the
12construction or operation of a data center that has been
13granted a certificate of exemption by the Department of
14Commerce and Economic Opportunity, whether that tangible
15personal property is purchased by the owner, operator, or
16tenant of the data center or by a contractor or subcontractor
17of the owner, operator, or tenant. Data centers that would
18have qualified for a certificate of exemption prior to January
191, 2020 had Public Act 101-31 this amendatory Act of the 101st
20General Assembly been in effect, may apply for and obtain an
21exemption for subsequent purchases of computer equipment or
22enabling software purchased or leased to upgrade, supplement,
23or replace computer equipment or enabling software purchased
24or leased in the original investment that would have
25qualified.
26    The Department of Commerce and Economic Opportunity shall

 

 

HB3059- 39 -LRB103 27006 HLH 53373 b

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
7    buildings rehabilitated or constructed to house working
8    servers in one physical location or multiple sites within
9    the State of 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
8    must obtain from the purchaser a copy of the certificate
9    of 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, 2022, breast pumps, breast pump
14collection and storage supplies, and breast pump kits. This
15item (32) is exempt from the provisions of Section 3-75. As
16used in this item (32):
17        "Breast pump" means an electrically controlled or
18    manually controlled pump device designed or marketed to be
19    used to express milk from a human breast during lactation,
20    including the pump device and any battery, AC adapter, or
21    other power supply unit that is used to power the pump
22    device and is packaged and sold with the pump device at the
23    time of sale.
24        "Breast pump collection and storage supplies" means
25    items of tangible personal property designed or marketed
26    to be used in conjunction with a breast pump to collect

 

 

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1    milk expressed from a human breast and to store collected
2    milk until it is ready for consumption.
3        "Breast pump collection and storage supplies"
4    includes, but is not limited to: breast shields and breast
5    shield connectors; breast pump tubes and tubing adapters;
6    breast pump valves and membranes; backflow protectors and
7    backflow protector adaptors; bottles and bottle caps
8    specific to the operation of the breast pump; and breast
9    milk storage bags.
10        "Breast pump collection and storage supplies" does not
11    include: (1) bottles and bottle caps not specific to the
12    operation of the breast pump; (2) breast pump travel bags
13    and other similar carrying accessories, including ice
14    packs, labels, and other similar products; (3) breast pump
15    cleaning supplies; (4) nursing bras, bra pads, breast
16    shells, and other similar products; and (5) creams,
17    ointments, and other similar products that relieve
18    breastfeeding-related symptoms or conditions of the
19    breasts or nipples, unless sold as part of a breast pump
20    kit that is pre-packaged by the breast pump manufacturer
21    or distributor.
22        "Breast pump kit" means a kit that: (1) contains no
23    more than a breast pump, breast pump collection and
24    storage supplies, a rechargeable battery for operating the
25    breast pump, a breastmilk cooler, bottle stands, ice
26    packs, and a breast pump carrying case; and (2) is

 

 

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1    pre-packaged as a breast pump kit by the breast pump
2    manufacturer or distributor.
3    (33) (32) Tangible personal property sold by or on behalf
4of the State Treasurer pursuant to the Revised Uniform
5Unclaimed Property Act. This item (33) (32) is exempt from the
6provisions of Section 3-75.
7    (34) Beginning July 1, 2023, diapers. This item (34) is
8exempt from the provisions of Section 3-75.
9(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
10101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-700, Article
1170, Section 70-10, eff. 4-19-22; 102-700, Article 75, Section
1275-10, eff. 4-19-22; 102-1026, eff. 5-27-22; revised 8-3-22.)
 
13    Section 15. The Service Occupation Tax Act is amended by
14changing Section 3-5 as follows:
 
15    (35 ILCS 115/3-5)
16    Sec. 3-5. Exemptions. The following tangible personal
17property is exempt from the tax imposed by this Act:
18    (1) Personal property sold by a corporation, society,
19association, foundation, institution, or organization, other
20than a limited liability company, that is organized and
21operated as a not-for-profit service enterprise for the
22benefit of persons 65 years of age or older if the personal
23property was not purchased by the enterprise for the purpose
24of resale by the enterprise.

 

 

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1    (2) Personal property purchased by a not-for-profit
2Illinois county fair association for use in conducting,
3operating, or promoting the county fair.
4    (3) Personal property purchased by any not-for-profit arts
5or cultural organization that establishes, by proof required
6by the Department by rule, that it has received an exemption
7under Section 501(c)(3) of the Internal Revenue Code and that
8is organized and operated primarily for the presentation or
9support of arts or cultural programming, activities, or
10services. These organizations include, but are not limited to,
11music and dramatic arts organizations such as symphony
12orchestras and theatrical groups, arts and cultural service
13organizations, local arts councils, visual arts organizations,
14and media arts organizations. On and after July 1, 2001 (the
15effective date of Public Act 92-35), however, an entity
16otherwise eligible for this exemption shall not make tax-free
17purchases unless it has an active identification number issued
18by the Department.
19    (4) Legal tender, currency, medallions, or gold or silver
20coinage issued by the State of Illinois, the government of the
21United States of America, or the government of any foreign
22country, and bullion.
23    (5) Until July 1, 2003 and beginning again on September 1,
242004 through August 30, 2014, graphic arts machinery and
25equipment, including repair and replacement parts, both new
26and used, and including that manufactured on special order or

 

 

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

 

 

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

 

 

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

 

 

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1machinery and equipment purchased for lease; but excluding
2motor vehicles required to be registered under the Illinois
3Vehicle Code.
4    (11) Photoprocessing machinery and equipment, including
5repair and replacement parts, both new and used, including
6that manufactured on special order, certified by the purchaser
7to be used primarily for photoprocessing, and including
8photoprocessing machinery and equipment purchased for lease.
9    (12) Until July 1, 2028, coal and aggregate exploration,
10mining, off-highway hauling, processing, maintenance, and
11reclamation equipment, including replacement parts and
12equipment, and including equipment purchased for lease, but
13excluding motor vehicles required to be registered under the
14Illinois Vehicle Code. The changes made to this Section by
15Public Act 97-767 apply on and after July 1, 2003, but no claim
16for credit or refund is allowed on or after August 16, 2013
17(the effective date of Public Act 98-456) for such taxes paid
18during the period beginning July 1, 2003 and ending on August
1916, 2013 (the effective date of Public Act 98-456).
20    (13) Beginning January 1, 1992 and through June 30, 2016,
21food for human consumption that is to be consumed off the
22premises where it is sold (other than alcoholic beverages,
23soft drinks and food that has been prepared for immediate
24consumption) and prescription and non-prescription medicines,
25drugs, medical appliances, and insulin, urine testing
26materials, syringes, and needles used by diabetics, for human

 

 

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1use, when purchased for use by a person receiving medical
2assistance under Article V of the Illinois Public Aid Code who
3resides in a licensed long-term care facility, as defined in
4the Nursing Home Care Act, or in a licensed facility as defined
5in the ID/DD Community Care Act, the MC/DD Act, or the
6Specialized Mental Health Rehabilitation Act of 2013.
7    (14) Semen used for artificial insemination of livestock
8for direct agricultural production.
9    (15) Horses, or interests in horses, registered with and
10meeting the requirements of any of the Arabian Horse Club
11Registry of America, Appaloosa Horse Club, American Quarter
12Horse Association, United States Trotting Association, or
13Jockey Club, as appropriate, used for purposes of breeding or
14racing for prizes. This item (15) is exempt from the
15provisions of Section 3-55, and the exemption provided for
16under this item (15) applies for all periods beginning May 30,
171995, but no claim for credit or refund is allowed on or after
18January 1, 2008 (the effective date of Public Act 95-88) for
19such taxes paid during the period beginning May 30, 2000 and
20ending on January 1, 2008 (the effective date of Public Act
2195-88).
22    (16) Computers and communications equipment utilized for
23any hospital purpose and equipment used in the diagnosis,
24analysis, or treatment of hospital patients sold to a lessor
25who leases the equipment, under a lease of one year or longer
26executed or in effect at the time of the purchase, to a

 

 

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

 

 

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1purification facilities, storm water drainage and retention
2facilities, and sewage treatment facilities, resulting from a
3State or federally declared disaster in Illinois or bordering
4Illinois when such repairs are initiated on facilities located
5in the declared disaster area within 6 months after the
6disaster.
7    (20) Beginning July 1, 1999, game or game birds sold at a
8"game breeding and hunting preserve area" as that term is used
9in the Wildlife Code. This paragraph is exempt from the
10provisions of Section 3-55.
11    (21) A motor vehicle, as that term is defined in Section
121-146 of the Illinois Vehicle Code, that is donated to a
13corporation, limited liability company, society, association,
14foundation, or institution that is determined by the
15Department to be organized and operated exclusively for
16educational purposes. For purposes of this exemption, "a
17corporation, limited liability company, society, association,
18foundation, or institution organized and operated exclusively
19for educational purposes" means all tax-supported public
20schools, private schools that offer systematic instruction in
21useful branches of learning by methods common to public
22schools and that compare favorably in their scope and
23intensity with the course of study presented in tax-supported
24schools, and vocational or technical schools or institutes
25organized and operated exclusively to provide a course of
26study of not less than 6 weeks duration and designed to prepare

 

 

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1individuals to follow a trade or to pursue a manual,
2technical, mechanical, industrial, business, or commercial
3occupation.
4    (22) 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 3-55.
18    (23) 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
21other items, and replacement parts for these machines.
22Beginning January 1, 2002 and through June 30, 2003, machines
23and parts for machines used in commercial, coin-operated
24amusement and vending business if a use or occupation tax is
25paid on the gross receipts derived from the use of the
26commercial, coin-operated amusement and vending machines. This

 

 

HB3059- 52 -LRB103 27006 HLH 53373 b

1paragraph is exempt from the provisions of Section 3-55.
2    (24) Beginning on August 2, 2001 (the effective date of
3Public Act 92-227), computers and communications equipment
4utilized for any hospital purpose and equipment used in the
5diagnosis, analysis, or treatment of hospital patients sold to
6a lessor who leases the equipment, under a lease of one year or
7longer executed or in effect at the time of the purchase, to a
8hospital that has been issued an active tax exemption
9identification number by the Department under Section 1g of
10the Retailers' Occupation Tax Act. This paragraph is exempt
11from the provisions of Section 3-55.
12    (25) Beginning on August 2, 2001 (the effective date of
13Public Act 92-227), personal property sold to a lessor who
14leases the property, under a lease of one year or longer
15executed or in effect at the time of the purchase, to a
16governmental body that has been issued an active tax exemption
17identification number by the Department under Section 1g of
18the Retailers' Occupation Tax Act. This paragraph is exempt
19from the provisions of Section 3-55.
20    (26) Beginning on January 1, 2002 and through June 30,
212016, tangible personal property purchased from an Illinois
22retailer by a taxpayer engaged in centralized purchasing
23activities in Illinois who will, upon receipt of the property
24in Illinois, temporarily store the property in Illinois (i)
25for the purpose of subsequently transporting it outside this
26State for use or consumption thereafter solely outside this

 

 

HB3059- 53 -LRB103 27006 HLH 53373 b

1State or (ii) for the purpose of being processed, fabricated,
2or manufactured into, attached to, or incorporated into other
3tangible personal property to be transported outside this
4State and thereafter used or consumed solely outside this
5State. The Director of Revenue shall, pursuant to rules
6adopted in accordance with the Illinois Administrative
7Procedure Act, issue a permit to any taxpayer in good standing
8with the Department who is eligible for the exemption under
9this paragraph (26). The permit issued under this paragraph
10(26) shall authorize the holder, to the extent and in the
11manner specified in the rules adopted under this Act, to
12purchase tangible personal property from a retailer exempt
13from the taxes imposed by this Act. Taxpayers shall maintain
14all necessary books and records to substantiate the use and
15consumption of all such tangible personal property outside of
16the State of Illinois.
17    (27) Beginning January 1, 2008, tangible personal property
18used in the construction or maintenance of a community water
19supply, as defined under Section 3.145 of the Environmental
20Protection Act, that is operated by a not-for-profit
21corporation that holds a valid water supply permit issued
22under Title IV of the Environmental Protection Act. This
23paragraph is exempt from the provisions of Section 3-55.
24    (28) Tangible personal property sold to a
25public-facilities corporation, as described in Section
2611-65-10 of the Illinois Municipal Code, for purposes of

 

 

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1constructing or furnishing a municipal convention hall, but
2only if the legal title to the municipal convention hall is
3transferred to the municipality without any further
4consideration by or on behalf of the municipality at the time
5of the completion of the municipal convention hall or upon the
6retirement or redemption of any bonds or other debt
7instruments issued by the public-facilities corporation in
8connection with the development of the municipal convention
9hall. This exemption includes existing public-facilities
10corporations as provided in Section 11-65-25 of the Illinois
11Municipal Code. This paragraph is exempt from the provisions
12of Section 3-55.
13    (29) Beginning January 1, 2010 and continuing through
14December 31, 2024, materials, parts, equipment, components,
15and furnishings incorporated into or upon an aircraft as part
16of the modification, refurbishment, completion, replacement,
17repair, or maintenance of the aircraft. This exemption
18includes consumable supplies used in the modification,
19refurbishment, completion, replacement, repair, and
20maintenance of aircraft, but excludes any materials, parts,
21equipment, components, and consumable supplies used in the
22modification, replacement, repair, and maintenance of aircraft
23engines or power plants, whether such engines or power plants
24are installed or uninstalled upon any such aircraft.
25"Consumable supplies" include, but are not limited to,
26adhesive, tape, sandpaper, general purpose lubricants,

 

 

HB3059- 55 -LRB103 27006 HLH 53373 b

1cleaning solution, latex gloves, and protective films. This
2exemption applies only to the transfer of qualifying tangible
3personal property incident to the modification, refurbishment,
4completion, replacement, repair, or maintenance of an aircraft
5by persons who (i) hold an Air Agency Certificate and are
6empowered to operate an approved repair station by the Federal
7Aviation Administration, (ii) have a Class IV Rating, and
8(iii) conduct operations in accordance with Part 145 of the
9Federal Aviation Regulations. The exemption does not include
10aircraft operated by a commercial air carrier providing
11scheduled passenger air service pursuant to authority issued
12under Part 121 or Part 129 of the Federal Aviation
13Regulations. The changes made to this paragraph (29) by Public
14Act 98-534 are declarative of existing law. It is the intent of
15the General Assembly that the exemption under this paragraph
16(29) applies continuously from January 1, 2010 through
17December 31, 2024; however, no claim for credit or refund is
18allowed for taxes paid as a result of the disallowance of this
19exemption on or after January 1, 2015 and prior to February 5,
202020 (the effective date of Public Act 101-629) this
21amendatory Act of the 101st General Assembly.
22    (30) Beginning January 1, 2017 and through December 31,
232026, menstrual pads, tampons, and menstrual cups.
24    (31) Tangible personal property transferred to a purchaser
25who is exempt from tax by operation of federal law. This
26paragraph is exempt from the provisions of Section 3-55.

 

 

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1    (32) Qualified tangible personal property used in the
2construction or operation of a data center that has been
3granted a certificate of exemption by the Department of
4Commerce and Economic Opportunity, whether that tangible
5personal property is purchased by the owner, operator, or
6tenant of the data center or by a contractor or subcontractor
7of the owner, operator, or tenant. Data centers that would
8have qualified for a certificate of exemption prior to January
91, 2020 had Public Act 101-31 this amendatory Act of the 101st
10General Assembly been in effect, may apply for and obtain an
11exemption for subsequent purchases of computer equipment or
12enabling software purchased or leased to upgrade, supplement,
13or replace computer equipment or enabling software purchased
14or leased in the original investment that would have
15qualified.
16    The Department of Commerce and Economic Opportunity shall
17grant a certificate of exemption under this item (32) to
18qualified data centers as defined by Section 605-1025 of the
19Department of Commerce and Economic Opportunity Law of the
20Civil Administrative Code of Illinois.
21    For the purposes of this item (32):
22        "Data center" means a building or a series of
23    buildings rehabilitated or constructed to house working
24    servers in one physical location or multiple sites within
25    the State of Illinois.
26        "Qualified tangible personal property" means:

 

 

HB3059- 57 -LRB103 27006 HLH 53373 b

1    electrical systems and equipment; climate control and
2    chilling equipment and systems; mechanical systems and
3    equipment; monitoring and secure systems; emergency
4    generators; hardware; computers; servers; data storage
5    devices; network connectivity equipment; racks; cabinets;
6    telecommunications cabling infrastructure; raised floor
7    systems; peripheral components or systems; software;
8    mechanical, electrical, or plumbing systems; battery
9    systems; cooling systems and towers; temperature control
10    systems; other cabling; and other data center
11    infrastructure equipment and systems necessary to operate
12    qualified tangible personal property, including fixtures;
13    and component parts of any of the foregoing, including
14    installation, maintenance, repair, refurbishment, and
15    replacement of qualified tangible personal property to
16    generate, transform, transmit, distribute, or manage
17    electricity necessary to operate qualified tangible
18    personal property; and all other tangible personal
19    property that is essential to the operations of a computer
20    data center. The term "qualified tangible personal
21    property" also includes building materials physically
22    incorporated in to the qualifying data center. To document
23    the exemption allowed under this Section, the retailer
24    must obtain from the purchaser a copy of the certificate
25    of eligibility issued by the Department of Commerce and
26    Economic Opportunity.

 

 

HB3059- 58 -LRB103 27006 HLH 53373 b

1    This item (32) is exempt from the provisions of Section
23-55.
3    (33) Beginning July 1, 2022, breast pumps, breast pump
4collection and storage supplies, and breast pump kits. This
5item (33) is exempt from the provisions of Section 3-55. As
6used in this item (33):
7        "Breast pump" means an electrically controlled or
8    manually controlled pump device designed or marketed to be
9    used to express milk from a human breast during lactation,
10    including the pump device and any battery, AC adapter, or
11    other power supply unit that is used to power the pump
12    device and is packaged and sold with the pump device at the
13    time of sale.
14        "Breast pump collection and storage supplies" means
15    items of tangible personal property designed or marketed
16    to be used in conjunction with a breast pump to collect
17    milk expressed from a human breast and to store collected
18    milk until it is ready for consumption.
19        "Breast pump collection and storage supplies"
20    includes, but is not limited to: breast shields and breast
21    shield connectors; breast pump tubes and tubing adapters;
22    breast pump valves and membranes; backflow protectors and
23    backflow protector adaptors; bottles and bottle caps
24    specific to the operation of the breast pump; and breast
25    milk storage bags.
26        "Breast pump collection and storage supplies" does not

 

 

HB3059- 59 -LRB103 27006 HLH 53373 b

1    include: (1) bottles and bottle caps not specific to the
2    operation of the breast pump; (2) breast pump travel bags
3    and other similar carrying accessories, including ice
4    packs, labels, and other similar products; (3) breast pump
5    cleaning supplies; (4) nursing bras, bra pads, breast
6    shells, and other similar products; and (5) creams,
7    ointments, and other similar products that relieve
8    breastfeeding-related symptoms or conditions of the
9    breasts or nipples, unless sold as part of a breast pump
10    kit that is pre-packaged by the breast pump manufacturer
11    or distributor.
12        "Breast pump kit" means a kit that: (1) contains no
13    more than a breast pump, breast pump collection and
14    storage supplies, a rechargeable battery for operating the
15    breast pump, a breastmilk cooler, bottle stands, ice
16    packs, and a breast pump carrying case; and (2) is
17    pre-packaged as a breast pump kit by the breast pump
18    manufacturer or distributor.
19    (34) (33) Tangible personal property sold by or on behalf
20of the State Treasurer pursuant to the Revised Uniform
21Unclaimed Property Act. This item (34) (33) is exempt from the
22provisions of Section 3-55.
23    (35) Beginning July 1, 2023, diapers. This item (35) is
24exempt from the provisions of Section 3-55.
25(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
26101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-700, Article

 

 

HB3059- 60 -LRB103 27006 HLH 53373 b

170, Section 70-15, eff. 4-19-22; 102-700, Article 75, Section
275-15, eff. 4-19-22; 102-1026, eff. 5-27-22; revised 8-9-22.)
 
3    Section 20. The Retailers' Occupation Tax Act is amended
4by changing Section 2-5 as follows:
 
5    (35 ILCS 120/2-5)
6    Sec. 2-5. Exemptions. Gross receipts from proceeds from
7the sale of the following tangible personal property are
8exempt from the tax imposed by this Act:
9        (1) Farm chemicals.
10        (2) Farm machinery and equipment, both new and used,
11    including that manufactured on special order, certified by
12    the purchaser to be used primarily for production
13    agriculture or State or federal agricultural programs,
14    including individual replacement parts for the machinery
15    and equipment, including machinery and equipment purchased
16    for lease, and including implements of husbandry defined
17    in Section 1-130 of the Illinois Vehicle Code, farm
18    machinery and agricultural chemical and fertilizer
19    spreaders, and nurse wagons required to be registered
20    under Section 3-809 of the Illinois Vehicle Code, but
21    excluding other motor vehicles required to be registered
22    under the Illinois Vehicle Code. Horticultural polyhouses
23    or hoop houses used for propagating, growing, or
24    overwintering plants shall be considered farm machinery

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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1    including repair and replacement parts, both new and used,
2    including that manufactured on special order, certified by
3    the purchaser to be used primarily for photoprocessing,
4    and including photoprocessing machinery and equipment
5    purchased for lease.
6        (21) Until July 1, 2028, coal and aggregate
7    exploration, mining, off-highway hauling, processing,
8    maintenance, and reclamation equipment, including
9    replacement parts and equipment, and including equipment
10    purchased for lease, but excluding motor vehicles required
11    to be registered under the Illinois Vehicle Code. The
12    changes made to this Section by Public Act 97-767 apply on
13    and after July 1, 2003, but no claim for credit or refund
14    is allowed on or after August 16, 2013 (the effective date
15    of Public Act 98-456) for such taxes paid during the
16    period beginning July 1, 2003 and ending on August 16,
17    2013 (the effective date of Public Act 98-456).
18        (22) Until June 30, 2013, fuel and petroleum products
19    sold to or used by an air carrier, certified by the carrier
20    to be used for consumption, shipment, or storage in the
21    conduct of its business as an air common carrier, for a
22    flight destined for or returning from a location or
23    locations outside the United States without regard to
24    previous or subsequent domestic stopovers.
25        Beginning July 1, 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 that (i) is engaged in foreign trade or is engaged
4    in trade between the United States and any of its
5    possessions and (ii) transports at least one individual or
6    package for hire from the city of origination to the city
7    of final destination on the same aircraft, without regard
8    to a change in the flight number of that aircraft.
9        (23) A transaction in which the purchase order is
10    received by a florist who is located outside Illinois, but
11    who has a florist located in Illinois deliver the property
12    to the purchaser or the purchaser's donee in Illinois.
13        (24) Fuel consumed or used in the operation of ships,
14    barges, or vessels that are used primarily in or for the
15    transportation of property or the conveyance of persons
16    for hire on rivers bordering on this State if the fuel is
17    delivered by the seller to the purchaser's barge, ship, or
18    vessel while it is afloat upon that bordering river.
19        (25) Except as provided in item (25-5) of this
20    Section, a motor vehicle sold in this State to a
21    nonresident even though the motor vehicle is delivered to
22    the nonresident in this State, if the motor vehicle is not
23    to be titled in this State, and if a drive-away permit is
24    issued to the motor vehicle as provided in Section 3-603
25    of the Illinois Vehicle Code or if the nonresident
26    purchaser has vehicle registration plates to transfer to

 

 

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

 

 

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1    records. Nothing in this item shall be construed to
2    require the removal of the vehicle from this state
3    following the filing of an intent to title the vehicle in
4    the purchaser's state of residence if the purchaser titles
5    the vehicle in his or her state of residence within 30 days
6    after the date of sale. The tax collected under this Act in
7    accordance with this item (25-5) shall be proportionately
8    distributed as if the tax were collected at the 6.25%
9    general rate imposed under this Act.
10        (25-7) Beginning on July 1, 2007, no tax is imposed
11    under this Act on the sale of an aircraft, as defined in
12    Section 3 of the Illinois Aeronautics Act, if all of the
13    following conditions are met:
14            (1) the aircraft leaves this State within 15 days
15        after the later of either the issuance of the final
16        billing for the sale of the aircraft, or the
17        authorized approval for return to service, completion
18        of the maintenance record entry, and completion of the
19        test flight and ground test for inspection, as
20        required by 14 CFR C.F.R. 91.407;
21            (2) the aircraft is not based or registered in
22        this State after the sale of the aircraft; and
23            (3) the seller retains in his or her books and
24        records and provides to the Department a signed and
25        dated certification from the purchaser, on a form
26        prescribed by the Department, certifying that the

 

 

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

 

 

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

 

 

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

 

 

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1        (33) A motor vehicle, as that term is defined in
2    Section 1-146 of the Illinois Vehicle Code, that is
3    donated to a corporation, limited liability company,
4    society, association, foundation, or institution that is
5    determined by the Department to be organized and operated
6    exclusively for educational purposes. For purposes of this
7    exemption, "a corporation, limited liability company,
8    society, association, foundation, or institution organized
9    and operated exclusively for educational purposes" means
10    all tax-supported public schools, private schools that
11    offer systematic instruction in useful branches of
12    learning by methods common to public schools and that
13    compare favorably in their scope and intensity with the
14    course of study presented in tax-supported schools, and
15    vocational or technical schools or institutes organized
16    and operated exclusively to provide a course of study of
17    not less than 6 weeks duration and designed to prepare
18    individuals to follow a trade or to pursue a manual,
19    technical, mechanical, industrial, business, or commercial
20    occupation.
21        (34) Beginning January 1, 2000, personal property,
22    including food, purchased through fundraising events for
23    the benefit of a public or private elementary or secondary
24    school, a group of those schools, or one or more school
25    districts if the events are sponsored by an entity
26    recognized by the school district that consists primarily

 

 

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1    of volunteers and includes parents and teachers of the
2    school children. This paragraph does not apply to
3    fundraising events (i) for the benefit of private home
4    instruction or (ii) for which the fundraising entity
5    purchases the personal property sold at the events from
6    another individual or entity that sold the property for
7    the purpose of resale by the fundraising entity and that
8    profits from the sale to the fundraising entity. This
9    paragraph is exempt from the provisions of Section 2-70.
10        (35) Beginning January 1, 2000 and through December
11    31, 2001, new or used automatic vending machines that
12    prepare and serve hot food and beverages, including
13    coffee, soup, and other items, and replacement parts for
14    these machines. Beginning January 1, 2002 and through June
15    30, 2003, machines and parts for machines used in
16    commercial, coin-operated amusement and vending business
17    if a use or occupation tax is paid on the gross receipts
18    derived from the use of the commercial, coin-operated
19    amusement and vending machines. This paragraph is exempt
20    from the provisions of Section 2-70.
21        (35-5) Beginning August 23, 2001 and through June 30,
22    2016, food for human consumption that is to be consumed
23    off the premises where it is sold (other than alcoholic
24    beverages, soft drinks, and food that has been prepared
25    for immediate consumption) and prescription and
26    nonprescription medicines, drugs, medical appliances, and

 

 

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

 

 

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1    2016, tangible personal property purchased from an
2    Illinois retailer by a taxpayer engaged in centralized
3    purchasing activities in Illinois who will, upon receipt
4    of the property in Illinois, temporarily store the
5    property in Illinois (i) for the purpose of subsequently
6    transporting it outside this State for use or consumption
7    thereafter solely outside this State or (ii) for the
8    purpose of being processed, fabricated, or manufactured
9    into, attached to, or incorporated into other tangible
10    personal property to be transported outside this State and
11    thereafter used or consumed solely outside this State. The
12    Director of Revenue shall, pursuant to rules adopted in
13    accordance with the Illinois Administrative Procedure Act,
14    issue a permit to any taxpayer in good standing with the
15    Department who is eligible for the exemption under this
16    paragraph (38). The permit issued under this paragraph
17    (38) shall authorize the holder, to the extent and in the
18    manner specified in the rules adopted under this Act, to
19    purchase tangible personal property from a retailer exempt
20    from the taxes imposed by this Act. Taxpayers shall
21    maintain all necessary books and records to substantiate
22    the use and consumption of all such tangible personal
23    property outside of the State of Illinois.
24        (39) Beginning January 1, 2008, tangible personal
25    property used in the construction or maintenance of a
26    community water supply, as defined under Section 3.145 of

 

 

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1    the Environmental Protection Act, that is operated by a
2    not-for-profit corporation that holds a valid water supply
3    permit issued under Title IV of the Environmental
4    Protection Act. This paragraph is exempt from the
5    provisions of Section 2-70.
6        (40) Beginning January 1, 2010 and continuing through
7    December 31, 2024, materials, parts, equipment,
8    components, and furnishings incorporated into or upon an
9    aircraft as part of the modification, refurbishment,
10    completion, replacement, repair, or maintenance of the
11    aircraft. This exemption includes consumable supplies used
12    in the modification, refurbishment, completion,
13    replacement, repair, and maintenance of aircraft, but
14    excludes any materials, parts, equipment, components, and
15    consumable supplies used in the modification, replacement,
16    repair, and maintenance of aircraft engines or power
17    plants, whether such engines or power plants are installed
18    or uninstalled upon any such aircraft. "Consumable
19    supplies" include, but are not limited to, adhesive, tape,
20    sandpaper, general purpose lubricants, cleaning solution,
21    latex gloves, and protective films. This exemption applies
22    only to the sale of qualifying tangible personal property
23    to persons who modify, refurbish, complete, replace, or
24    maintain an aircraft and who (i) hold an Air Agency
25    Certificate and are empowered to operate an approved
26    repair station by the Federal Aviation Administration,

 

 

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1    (ii) have a Class IV Rating, and (iii) conduct operations
2    in accordance with Part 145 of the Federal Aviation
3    Regulations. The exemption does not include aircraft
4    operated by a commercial air carrier providing scheduled
5    passenger air service pursuant to authority issued under
6    Part 121 or Part 129 of the Federal Aviation Regulations.
7    The changes made to this paragraph (40) by Public Act
8    98-534 are declarative of existing law. It is the intent
9    of the General Assembly that the exemption under this
10    paragraph (40) applies continuously from January 1, 2010
11    through December 31, 2024; however, no claim for credit or
12    refund is allowed for taxes paid as a result of the
13    disallowance of this exemption on or after January 1, 2015
14    and prior to February 5, 2020 (the effective date of
15    Public Act 101-629) this amendatory Act of the 101st
16    General Assembly.
17        (41) Tangible personal property sold to a
18    public-facilities corporation, as described in Section
19    11-65-10 of the Illinois Municipal Code, for purposes of
20    constructing or furnishing a municipal convention hall,
21    but only if the legal title to the municipal convention
22    hall is transferred to the municipality without any
23    further consideration by or on behalf of the municipality
24    at the time of the completion of the municipal convention
25    hall or upon the retirement or redemption of any bonds or
26    other debt instruments issued by the public-facilities

 

 

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1    corporation in connection with the development of the
2    municipal convention hall. This exemption includes
3    existing public-facilities corporations as provided in
4    Section 11-65-25 of the Illinois Municipal Code. This
5    paragraph is exempt from the provisions of Section 2-70.
6        (42) Beginning January 1, 2017 and through December
7    31, 2026, menstrual pads, tampons, and menstrual cups.
8        (43) Merchandise that is subject to the Rental
9    Purchase Agreement Occupation and Use Tax. The purchaser
10    must certify that the item is purchased to be rented
11    subject to a rental purchase agreement, as defined in the
12    Rental Purchase Agreement Act, and provide proof of
13    registration under the Rental Purchase Agreement
14    Occupation and Use Tax Act. This paragraph is exempt from
15    the provisions of Section 2-70.
16        (44) Qualified tangible personal property used in the
17    construction or operation of a data center that has been
18    granted a certificate of exemption by the Department of
19    Commerce and Economic Opportunity, whether that tangible
20    personal property is purchased by the owner, operator, or
21    tenant of the data center or by a contractor or
22    subcontractor of the owner, operator, or tenant. Data
23    centers that would have qualified for a certificate of
24    exemption prior to January 1, 2020 had Public Act 101-31
25    this amendatory Act of the 101st General Assembly been in
26    effect, may apply for and obtain an exemption for

 

 

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

 

 

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1        temperature control systems; other cabling; and other
2        data center infrastructure equipment and systems
3        necessary to operate qualified tangible personal
4        property, including fixtures; and component parts of
5        any of the foregoing, including installation,
6        maintenance, repair, refurbishment, and replacement of
7        qualified tangible personal property to generate,
8        transform, transmit, distribute, or manage electricity
9        necessary to operate qualified tangible personal
10        property; and all other tangible personal property
11        that is essential to the operations of a computer data
12        center. The term "qualified tangible personal
13        property" also includes building materials physically
14        incorporated into the qualifying data center. To
15        document the exemption allowed under this Section, the
16        retailer must obtain from the purchaser a copy of the
17        certificate of eligibility issued by the Department of
18        Commerce and Economic Opportunity.
19        This item (44) is exempt from the provisions of
20    Section 2-70.
21        (45) Beginning January 1, 2020 and through December
22    31, 2020, sales of tangible personal property made by a
23    marketplace seller over a marketplace for which tax is due
24    under this Act but for which use tax has been collected and
25    remitted to the Department by a marketplace facilitator
26    under Section 2d of the Use Tax Act are exempt from tax

 

 

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1    under this Act. A marketplace seller claiming this
2    exemption shall maintain books and records demonstrating
3    that the use tax on such sales has been collected and
4    remitted by a marketplace facilitator. Marketplace sellers
5    that have properly remitted tax under this Act on such
6    sales may file a claim for credit as provided in Section 6
7    of this Act. No claim is allowed, however, for such taxes
8    for which a credit or refund has been issued to the
9    marketplace facilitator under the Use Tax Act, or for
10    which the marketplace facilitator has filed a claim for
11    credit or refund under the Use Tax Act.
12        (46) Beginning July 1, 2022, breast pumps, breast pump
13    collection and storage supplies, and breast pump kits.
14    This item (46) is exempt from the provisions of Section
15    2-70. As used in this item (46):
16        "Breast pump" means an electrically controlled or
17    manually controlled pump device designed or marketed to be
18    used to express milk from a human breast during lactation,
19    including the pump device and any battery, AC adapter, or
20    other power supply unit that is used to power the pump
21    device and is packaged and sold with the pump device at the
22    time of sale.
23        "Breast pump collection and storage supplies" means
24    items of tangible personal property designed or marketed
25    to be used in conjunction with a breast pump to collect
26    milk expressed from a human breast and to store collected

 

 

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1    milk until it is ready for consumption.
2        "Breast pump collection and storage supplies"
3    includes, but is not limited to: breast shields and breast
4    shield connectors; breast pump tubes and tubing adapters;
5    breast pump valves and membranes; backflow protectors and
6    backflow protector adaptors; bottles and bottle caps
7    specific to the operation of the breast pump; and breast
8    milk storage bags.
9        "Breast pump collection and storage supplies" does not
10    include: (1) bottles and bottle caps not specific to the
11    operation of the breast pump; (2) breast pump travel bags
12    and other similar carrying accessories, including ice
13    packs, labels, and other similar products; (3) breast pump
14    cleaning supplies; (4) nursing bras, bra pads, breast
15    shells, and other similar products; and (5) creams,
16    ointments, and other similar products that relieve
17    breastfeeding-related symptoms or conditions of the
18    breasts or nipples, unless sold as part of a breast pump
19    kit that is pre-packaged by the breast pump manufacturer
20    or distributor.
21        "Breast pump kit" means a kit that: (1) contains no
22    more than a breast pump, breast pump collection and
23    storage supplies, a rechargeable battery for operating the
24    breast pump, a breastmilk cooler, bottle stands, ice
25    packs, and a breast pump carrying case; and (2) is
26    pre-packaged as a breast pump kit by the breast pump

 

 

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1    manufacturer or distributor.
2        (47) (46) Tangible personal property sold by or on
3    behalf of the State Treasurer pursuant to the Revised
4    Uniform Unclaimed Property Act. This item (47) (46) is
5    exempt from the provisions of Section 2-70.
6        (48) Beginning July 1, 2023, diapers. This item (48)
7    is exempt from the provisions of Section 2-70.
8(Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
9101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-634, eff.
108-27-21; 102-700, Article 70, Section 70-20, eff. 4-19-22;
11102-700, Article 75, Section 75-20, eff. 4-19-22; 102-813,
12eff. 5-13-22; 102-1026, eff. 5-27-22; revised 8-15-22.)
 
13    Section 99. Effective date. This Act takes effect upon
14becoming law.