97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB1731

 

Introduced , by Rep. Karen A. Yarbrough

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 143/10-5
35 ILCS 143/10-10
35 ILCS 143/10-30

    Amends the Tobacco Products Tax Act of 1995. Defines "little cigar". Provides that little cigars shall be taxed at a rate per cigar that is equal to the rate imposed per cigarette under the Cigarette Tax Act. Provides that a distributor shall disclose the quantity of little cigars sold or otherwise disposed of.


LRB097 10208 PJG 50404 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB1731LRB097 10208 PJG 50404 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 Tobacco Products Tax Act of 1995 is amended
5by changing Sections 10-5, 10-10, and 10-30 as follows:
 
6    (35 ILCS 143/10-5)
7    Sec. 10-5. Definitions. For purposes of this Act:
8    "Business" means any trade, occupation, activity, or
9enterprise engaged in, at any location whatsoever, for the
10purpose of selling tobacco products.
11    "Cigarette" has the meaning ascribed to the term in Section
121 of the Cigarette Tax Act.
13    "Correctional Industries program" means a program run by a
14State penal institution in which residents of the penal
15institution produce tobacco products for sale to persons
16incarcerated in penal institutions or resident patients of a
17State operated mental health facility.
18    "Department" means the Illinois Department of Revenue.
19    "Distributor" means any of the following:
20        (1) Any manufacturer or wholesaler in this State
21    engaged in the business of selling tobacco products who
22    sells, exchanges, or distributes tobacco products to
23    retailers or consumers in this State.

 

 

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1        (2) Any manufacturer or wholesaler engaged in the
2    business of selling tobacco products from without this
3    State who sells, exchanges, distributes, ships, or
4    transports tobacco products to retailers or consumers
5    located in this State, so long as that manufacturer or
6    wholesaler has or maintains within this State, directly or
7    by subsidiary, an office, sales house, or other place of
8    business, or any agent or other representative operating
9    within this State under the authority of the person or
10    subsidiary, irrespective of whether the place of business
11    or agent or other representative is located here
12    permanently or temporarily.
13        (3) Any retailer who receives tobacco products on which
14    the tax has not been or will not be paid by another
15    distributor.
16    "Distributor" does not include any person, wherever
17resident or located, who makes, manufactures, or fabricates
18tobacco products as part of a Correctional Industries program
19for sale to residents incarcerated in penal institutions or
20resident patients of a State operated mental health facility.
21    "Little cigar" means any roll for smoking, made wholly or
22in part of tobacco, if such product uses an integrated
23cellulose acetate or other similar filter and is wrapped in any
24substance containing tobacco, other than natural leaf tobacco.
25    "Manufacturer" means any person, wherever resident or
26located, who manufactures and sells tobacco products, except a

 

 

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1person who makes, manufactures, or fabricates tobacco products
2as a part of a Correctional Industries program for sale to
3persons incarcerated in penal institutions or resident
4patients of a State operated mental health facility.
5    "Person" means any natural individual, firm, partnership,
6association, joint stock company, joint venture, limited
7liability company, or public or private corporation, however
8formed, or a receiver, executor, administrator, trustee,
9conservator, or other representative appointed by order of any
10court.
11    "Place of business" means and includes any place where
12tobacco products are sold or where tobacco products are
13manufactured, stored, or kept for the purpose of sale or
14consumption, including any vessel, vehicle, airplane, train,
15or vending machine.
16    "Retailer" means any person in this State engaged in the
17business of selling tobacco products to consumers in this
18State, regardless of quantity or number of sales.
19    "Sale" means any transfer, exchange, or barter in any
20manner or by any means whatsoever for a consideration and
21includes all sales made by persons.
22    "Tobacco products" means any cigars, including little
23cigars; cheroots; stogies; periques; granulated, plug cut,
24crimp cut, ready rubbed, and other smoking tobacco; snuff or
25snuff flour; cavendish; plug and twist tobacco; fine-cut and
26other chewing tobaccos; shorts; refuse scraps, clippings,

 

 

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1cuttings, and sweeping of tobacco; and other kinds and forms of
2tobacco, prepared in such manner as to be suitable for chewing
3or smoking in a pipe or otherwise, or both for chewing and
4smoking; but does not include cigarettes or tobacco purchased
5for the manufacture of cigarettes by cigarette distributors and
6manufacturers defined in the Cigarette Tax Act and persons who
7make, manufacture, or fabricate cigarettes as a part of a
8Correctional Industries program for sale to residents
9incarcerated in penal institutions or resident patients of a
10State operated mental health facility.
11    "Wholesale price" means the established list price for
12which a manufacturer sells tobacco products to a distributor,
13before the allowance of any discount, trade allowance, rebate,
14or other reduction. In the absence of such an established list
15price, the manufacturer's invoice price at which the
16manufacturer sells the tobacco product to unaffiliated
17distributors, before any discounts, trade allowances, rebates,
18or other reductions, shall be presumed to be the wholesale
19price.
20    "Wholesaler" means any person, wherever resident or
21located, engaged in the business of selling tobacco products to
22others for the purpose of resale.
23(Source: P.A. 92-231, eff. 8-2-01.)
 
24    (35 ILCS 143/10-10)
25    Sec. 10-10. Tax imposed. On the first day of the third

 

 

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1month after the month in which this Act becomes law, a tax is
2imposed on any person engaged in business as a distributor of
3tobacco products. The tax on tobacco products, other than
4little cigars, as defined in Section 10-5, is at the rate of
518% of the wholesale price of tobacco products sold or
6otherwise disposed of to retailers or consumers located in this
7State. The tax on little cigars, as defined in Section 10-5, is
8at a rate per little cigar that is equal to the total taxes
9imposed per cigarette under Section 2 of the Cigarette Tax Act,
10as such Section may be amended from time to time, or under any
11successor provisions taxing cigarettes. The tax is in addition
12to all other occupation or privilege taxes imposed by the State
13of Illinois, by any political subdivision thereof, or by any
14municipal corporation. However, the tax is not imposed upon any
15activity in that business in interstate commerce or otherwise,
16to the extent to which that activity may not, under the
17Constitution and Statutes of the United States, be made the
18subject of taxation by this State. The tax is also not imposed
19on sales made to the United States or any entity thereof.
20    All moneys received by the Department under this Act shall
21be paid into the Long-Term Care Provider Fund of the State
22Treasury.
23(Source: P.A. 92-231, eff. 8-2-01.)
 
24    (35 ILCS 143/10-30)
25    Sec. 10-30. Returns. Every distributor shall, on or before

 

 

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1the 15th day of each month, file a return with the Department
2covering the preceding calendar month. The return shall
3disclose the wholesale price for tobacco products and the
4quantity of little cigars sold or otherwise disposed of and
5other information that the Department may reasonably require.
6The return shall be filed upon a form prescribed and furnished
7by the Department.
8    At the time when any return of any distributor is due to be
9filed with the Department, the distributor shall also remit to
10the Department the tax liability that the distributor has
11incurred for transactions occurring in the preceding calendar
12month.
13(Source: P.A. 89-21, eff. 6-6-95.)