97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB2867

 

Introduced 2/22/2011, by Rep. Thomas Holbrook

 

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 certain electric vehicles are exempt from taxation under the Acts. Effective July 1, 2011.


LRB097 10601 HLH 50977 b

FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB2867LRB097 10601 HLH 50977 b

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

 

 

HB2867- 2 -LRB097 10601 HLH 50977 b

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 the effective date
7of this amendatory Act of the 92nd General Assembly, however,
8an entity otherwise eligible for this exemption shall not make
9tax-free purchases unless it has an active identification
10number issued by the Department.
11    (4) Personal property purchased by a governmental body, by
12a corporation, society, association, foundation, or
13institution organized and operated exclusively for charitable,
14religious, or educational purposes, or by a not-for-profit
15corporation, society, association, foundation, institution, or
16organization that has no compensated officers or employees and
17that is organized and operated primarily for the recreation of
18persons 55 years of age or older. A limited liability company
19may qualify for the exemption under this paragraph only if the
20limited liability company is organized and operated
21exclusively for educational purposes. On and after July 1,
221987, however, no entity otherwise eligible for this exemption
23shall make tax-free purchases unless it has an active exemption
24identification number issued by the Department.
25    (5) Until July 1, 2003, a passenger car that is a
26replacement vehicle to the extent that the purchase price of

 

 

HB2867- 3 -LRB097 10601 HLH 50977 b

1the car is subject to the Replacement Vehicle Tax.
2    (6) Until July 1, 2003 and beginning again on September 1,
32004 through August 30, 2014, graphic arts machinery and
4equipment, including repair and replacement parts, both new and
5used, and including that manufactured on special order,
6certified by the purchaser to be used primarily for graphic
7arts production, and including machinery and equipment
8purchased for lease. Equipment includes chemicals or chemicals
9acting as catalysts but only if the chemicals or chemicals
10acting as catalysts effect a direct and immediate change upon a
11graphic arts product.
12    (7) Farm chemicals.
13    (8) Legal tender, currency, medallions, or gold or silver
14coinage issued by the State of Illinois, the government of the
15United States of America, or the government of any foreign
16country, and bullion.
17    (9) Personal property purchased from a teacher-sponsored
18student organization affiliated with an elementary or
19secondary school located in Illinois.
20    (10) A motor vehicle of the first division, a motor vehicle
21of the second division that is a self-contained motor vehicle
22designed or permanently converted to provide living quarters
23for recreational, camping, or travel use, with direct walk
24through to the living quarters from the driver's seat, or a
25motor vehicle of the second division that is of the van
26configuration designed for the transportation of not less than

 

 

HB2867- 4 -LRB097 10601 HLH 50977 b

17 nor more than 16 passengers, as defined in Section 1-146 of
2the Illinois Vehicle Code, that is used for automobile renting,
3as defined in the Automobile Renting Occupation and Use Tax
4Act.
5    (11) Farm machinery and equipment, both new and used,
6including that manufactured on special order, certified by the
7purchaser to be used primarily for production agriculture or
8State or federal agricultural programs, including individual
9replacement parts for the machinery and equipment, including
10machinery and equipment purchased for lease, and including
11implements of husbandry defined in Section 1-130 of the
12Illinois Vehicle Code, farm machinery and agricultural
13chemical and fertilizer spreaders, and nurse wagons required to
14be registered under Section 3-809 of the Illinois Vehicle Code,
15but excluding other motor vehicles required to be registered
16under the Illinois Vehicle Code. Horticultural polyhouses or
17hoop houses used for propagating, growing, or overwintering
18plants shall be considered farm machinery and equipment under
19this item (11). Agricultural chemical tender tanks and dry
20boxes shall include units sold separately from a motor vehicle
21required to be licensed and units sold mounted on a motor
22vehicle required to be licensed if the selling price of the
23tender is separately stated.
24    Farm machinery and equipment shall include precision
25farming equipment that is installed or purchased to be
26installed on farm machinery and equipment including, but not

 

 

HB2867- 5 -LRB097 10601 HLH 50977 b

1limited to, tractors, harvesters, sprayers, planters, seeders,
2or spreaders. Precision farming equipment includes, but is not
3limited to, soil testing sensors, computers, monitors,
4software, global positioning and mapping systems, and other
5such equipment.
6    Farm machinery and equipment also includes computers,
7sensors, software, and related equipment used primarily in the
8computer-assisted operation of production agriculture
9facilities, equipment, and activities such as, but not limited
10to, the collection, monitoring, and correlation of animal and
11crop data for the purpose of formulating animal diets and
12agricultural chemicals. This item (11) is exempt from the
13provisions of Section 3-90.
14    (12) Fuel and petroleum products sold to or used by an air
15common carrier, certified by the carrier to be used for
16consumption, shipment, or storage in the conduct of its
17business as an air common carrier, for a flight destined for or
18returning from a location or locations outside the United
19States without regard to previous or subsequent domestic
20stopovers.
21    (13) Proceeds of mandatory service charges separately
22stated on customers' bills for the purchase and consumption of
23food and beverages purchased at retail from a retailer, to the
24extent that the proceeds of the service charge are in fact
25turned over as tips or as a substitute for tips to the
26employees who participate directly in preparing, serving,

 

 

HB2867- 6 -LRB097 10601 HLH 50977 b

1hosting or cleaning up the food or beverage function with
2respect to which the service charge is imposed.
3    (14) Until July 1, 2003, oil field exploration, drilling,
4and production equipment, including (i) rigs and parts of rigs,
5rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
6tubular goods, including casing and drill strings, (iii) pumps
7and pump-jack units, (iv) storage tanks and flow lines, (v) any
8individual replacement part for oil field exploration,
9drilling, and production equipment, and (vi) machinery and
10equipment purchased for lease; but excluding motor vehicles
11required to be registered under the Illinois Vehicle Code.
12    (15) Photoprocessing machinery and equipment, including
13repair and replacement parts, both new and used, including that
14manufactured on special order, certified by the purchaser to be
15used primarily for photoprocessing, and including
16photoprocessing machinery and equipment purchased for lease.
17    (16) Until July 1, 2003, coal exploration, mining,
18offhighway hauling, processing, maintenance, and reclamation
19equipment, including replacement parts and equipment, and
20including equipment purchased for lease, but excluding motor
21vehicles required to be registered under the Illinois Vehicle
22Code.
23    (17) Until July 1, 2003, distillation machinery and
24equipment, sold as a unit or kit, assembled or installed by the
25retailer, certified by the user to be used only for the
26production of ethyl alcohol that will be used for consumption

 

 

HB2867- 7 -LRB097 10601 HLH 50977 b

1as motor fuel or as a component of motor fuel for the personal
2use of the user, and not subject to sale or resale.
3    (18) Manufacturing and assembling machinery and equipment
4used primarily in the process of manufacturing or assembling
5tangible personal property for wholesale or retail sale or
6lease, whether that sale or lease is made directly by the
7manufacturer or by some other person, whether the materials
8used in the process are owned by the manufacturer or some other
9person, or whether that sale or lease is made apart from or as
10an incident to the seller's engaging in the service occupation
11of producing machines, tools, dies, jigs, patterns, gauges, or
12other similar items of no commercial value on special order for
13a particular purchaser.
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 provisions

 

 

HB2867- 8 -LRB097 10601 HLH 50977 b

1of Section 3-90, and the exemption provided for under this item
2(21) applies for all periods beginning May 30, 1995, but no
3claim for credit or refund is allowed on or after January 1,
42008 for such taxes paid during the period beginning May 30,
52000 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 the
14Retailers' Occupation Tax Act. If the equipment is leased in a
15manner that does not qualify for this exemption or is used in
16any other non-exempt manner, the lessor shall be liable for the
17tax imposed under this Act or the Service Use Tax Act, as the
18case may be, based on the fair market value of the property at
19the time the non-qualifying use occurs. No lessor shall collect
20or attempt to collect an amount (however designated) that
21purports to reimburse that lessor for the tax imposed by this
22Act or the Service Use Tax Act, as the case may be, if the tax
23has not been paid by the lessor. If a lessor improperly
24collects any such amount from the lessee, the lessee shall have
25a legal right to claim a refund of that amount from the lessor.
26If, however, that amount is not refunded to the lessee for any

 

 

HB2867- 9 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 10 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 11 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 12 -LRB097 10601 HLH 50977 b

1another individual or entity that sold the property for the
2purpose of resale by the fundraising entity and that profits
3from the sale to the fundraising entity. This paragraph is
4exempt from the provisions of Section 3-90.
5    (29) Beginning January 1, 2000 and through December 31,
62001, new or used automatic vending machines that prepare and
7serve hot food and beverages, including coffee, soup, and other
8items, and replacement parts for these machines. Beginning
9January 1, 2002 and through June 30, 2003, machines and parts
10for machines used in commercial, coin-operated amusement and
11vending business if a use or occupation tax is paid on the
12gross receipts derived from the use of the commercial,
13coin-operated amusement and vending machines. This paragraph
14is exempt from the provisions of Section 3-90.
15    (30) Beginning January 1, 2001 and through June 30, 2011,
16food for human consumption that is to be consumed off the
17premises where it is sold (other than alcoholic beverages, soft
18drinks, and food that has been prepared for immediate
19consumption) and prescription and nonprescription medicines,
20drugs, medical appliances, and insulin, urine testing
21materials, syringes, and needles used by diabetics, for human
22use, when purchased for use by a person receiving medical
23assistance under Article V of the Illinois Public Aid Code who
24resides in a licensed long-term care facility, as defined in
25the Nursing Home Care Act, or in a licensed facility as defined
26in the MR/DD Community Care Act.

 

 

HB2867- 13 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 14 -LRB097 10601 HLH 50977 b

1of the 92nd General Assembly, personal property purchased by a
2lessor who leases the property, under a lease of one year or
3longer executed or in effect at the time the lessor would
4otherwise be subject to the tax imposed by this Act, to a
5governmental body that has been issued an active sales tax
6exemption identification number by the Department under
7Section 1g of the Retailers' Occupation Tax Act. If the
8property is leased in a manner that does not qualify for this
9exemption or used in any other nonexempt manner, the lessor
10shall be liable for the tax imposed under this Act or the
11Service Use Tax Act, as the case may be, based on the fair
12market value of the property at the time the nonqualifying use
13occurs. No lessor shall collect or attempt to collect an amount
14(however designated) that purports to reimburse that lessor for
15the tax imposed by this Act or the Service Use Tax Act, as the
16case may be, if the tax has not been paid by the lessor. If a
17lessor improperly collects any such amount from the lessee, the
18lessee shall have a legal right to claim a refund of that
19amount from the lessor. If, however, that amount is not
20refunded to the lessee for any reason, the lessor is liable to
21pay that amount to the Department. This paragraph is exempt
22from the provisions of Section 3-90.
23    (33) On and after July 1, 2003 and through June 30, 2004,
24the use in this State of motor vehicles of the second division
25with a gross vehicle weight in excess of 8,000 pounds and that
26are subject to the commercial distribution fee imposed under

 

 

HB2867- 15 -LRB097 10601 HLH 50977 b

1Section 3-815.1 of the Illinois Vehicle Code. Beginning on July
21, 2004 and through June 30, 2005, the use in this State of
3motor vehicles of the second division: (i) with a gross vehicle
4weight rating in excess of 8,000 pounds; (ii) that are subject
5to the commercial distribution fee imposed under Section
63-815.1 of the Illinois Vehicle Code; and (iii) that are
7primarily used for commercial purposes. Through June 30, 2005,
8this exemption applies to repair and replacement parts added
9after the initial purchase of such a motor vehicle if that
10motor vehicle is used in a manner that would qualify for the
11rolling stock exemption otherwise provided for in this Act. For
12purposes of this paragraph, the term "used for commercial
13purposes" means the transportation of persons or property in
14furtherance of any commercial or industrial enterprise,
15whether for-hire or not.
16    (34) Beginning January 1, 2008, tangible personal property
17used in the construction or maintenance of a community water
18supply, as defined under Section 3.145 of the Environmental
19Protection Act, that is operated by a not-for-profit
20corporation that holds a valid water supply permit issued under
21Title IV of the Environmental Protection Act. This paragraph is
22exempt from the provisions of Section 3-90.
23    (35) Beginning January 1, 2010, materials, parts,
24equipment, components, and furnishings incorporated into or
25upon an aircraft as part of the modification, refurbishment,
26completion, replacement, repair, or maintenance of the

 

 

HB2867- 16 -LRB097 10601 HLH 50977 b

1aircraft. This exemption includes consumable supplies used in
2the modification, refurbishment, completion, replacement,
3repair, and maintenance of aircraft, but excludes any
4materials, parts, equipment, components, and consumable
5supplies used in the modification, replacement, repair, and
6maintenance of aircraft engines or power plants, whether such
7engines or power plants are installed or uninstalled upon any
8such aircraft. "Consumable supplies" include, but are not
9limited to, adhesive, tape, sandpaper, general purpose
10lubricants, cleaning solution, latex gloves, and protective
11films. This exemption applies only to those organizations that
12(i) hold an Air Agency Certificate and are empowered to operate
13an approved repair station by the Federal Aviation
14Administration, (ii) have a Class IV Rating, and (iii) conduct
15operations in accordance with Part 145 of the Federal Aviation
16Regulations. The exemption does not include aircraft operated
17by a commercial air carrier providing scheduled passenger air
18service pursuant to authority issued under Part 121 or Part 129
19of the Federal Aviation Regulations.
20    (36) Tangible personal property purchased by a
21public-facilities corporation, as described in Section
2211-65-10 of the Illinois Municipal Code, for purposes of
23constructing or furnishing a municipal convention hall, but
24only if the legal title to the municipal convention hall is
25transferred to the municipality without any further
26consideration by or on behalf of the municipality at the time

 

 

HB2867- 17 -LRB097 10601 HLH 50977 b

1of the completion of the municipal convention hall or upon the
2retirement or redemption of any bonds or other debt instruments
3issued by the public-facilities corporation in connection with
4the development of the municipal convention hall. This
5exemption includes existing public-facilities corporations as
6provided in Section 11-65-25 of the Illinois Municipal Code.
7This paragraph is exempt from the provisions of Section 3-90.
8    (37) On and after July 1, 2011 and through June 30, 2016, a
9qualified plug-in electric drive vehicle that (i) is a
104-wheeled motor vehicle, (ii) is made by a manufacturer
11primarily for use on public streets, roads, and highways, (iii)
12has not been modified from the original manufacturer
13specifications, (iv) is acquired for use or lease by the
14purchaser or lessor and not for resale, (v) is rated at not
15more than 8,500 pounds unloaded gross vehicle weight, (vi) has
16a maximum speed capability of at least 65 miles per hour, (vii)
17is propelled to a significant extent by an electric motor that
18draws electricity from a battery that has a capacity of not
19less than 4 kilowatt hours and is capable of being recharged
20from an external source of electricity, and (viii) is acquired
21by the purchaser or lessor on or after July 1, 2011 and through
22June 30, 2016.
23(Source: P.A. 95-88, eff. 1-1-08; 95-538, eff. 1-1-08; 95-876,
24eff. 8-21-08; 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
2596-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
267-2-10.)
 

 

 

HB2867- 18 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 19 -LRB097 10601 HLH 50977 b

1organizations, local arts councils, visual arts organizations,
2and media arts organizations. On and after the effective date
3of this amendatory Act of the 92nd General Assembly, however,
4an entity otherwise eligible for this exemption shall not make
5tax-free purchases unless it has an active identification
6number issued by the Department.
7    (4) Legal tender, currency, medallions, or gold or silver
8coinage issued by the State of Illinois, the government of the
9United States of America, or the government of any foreign
10country, and bullion.
11    (5) Until July 1, 2003 and beginning again on September 1,
122004 through August 30, 2014, graphic arts machinery and
13equipment, including repair and replacement parts, both new and
14used, and including that manufactured on special order or
15purchased for lease, certified by the purchaser to be used
16primarily for graphic arts production. Equipment includes
17chemicals or chemicals acting as catalysts but only if the
18chemicals or chemicals acting as catalysts effect a direct and
19immediate change upon a graphic arts product.
20    (6) Personal property purchased from a teacher-sponsored
21student organization affiliated with an elementary or
22secondary school located in Illinois.
23    (7) Farm machinery and equipment, both new and used,
24including that manufactured on special order, certified by the
25purchaser to be used primarily for production agriculture or
26State or federal agricultural programs, including individual

 

 

HB2867- 20 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 21 -LRB097 10601 HLH 50977 b

1facilities, equipment, and activities such as, but not limited
2to, the collection, monitoring, and correlation of animal and
3crop data for the purpose of formulating animal diets and
4agricultural chemicals. This item (7) is exempt from the
5provisions of Section 3-75.
6    (8) Fuel and petroleum products sold to or used by an air
7common carrier, certified by the carrier to be used for
8consumption, shipment, or storage in the conduct of its
9business as an air common carrier, for a flight destined for or
10returning from a location or locations outside the United
11States without regard to previous or subsequent domestic
12stopovers.
13    (9) Proceeds of mandatory service charges separately
14stated on customers' bills for the purchase and consumption of
15food and beverages acquired as an incident to the purchase of a
16service from a serviceman, to the extent that the proceeds of
17the service charge are in fact turned over as tips or as a
18substitute for tips to the employees who participate directly
19in preparing, serving, hosting or cleaning up the food or
20beverage function with respect to which the service charge is
21imposed.
22    (10) Until July 1, 2003, oil field exploration, drilling,
23and production equipment, including (i) rigs and parts of rigs,
24rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
25tubular goods, including casing and drill strings, (iii) pumps
26and pump-jack units, (iv) storage tanks and flow lines, (v) any

 

 

HB2867- 22 -LRB097 10601 HLH 50977 b

1individual replacement part for oil field exploration,
2drilling, and production equipment, and (vi) machinery and
3equipment purchased for lease; but excluding motor vehicles
4required to be registered under the Illinois Vehicle Code.
5    (11) Proceeds from the sale of photoprocessing machinery
6and equipment, including repair and replacement parts, both new
7and used, including that manufactured on special order,
8certified by the purchaser to be used primarily for
9photoprocessing, and including photoprocessing machinery and
10equipment purchased for lease.
11    (12) Until July 1, 2003, coal exploration, mining,
12offhighway hauling, processing, maintenance, and reclamation
13equipment, including replacement parts and equipment, and
14including equipment purchased for lease, but excluding motor
15vehicles required to be registered under the Illinois Vehicle
16Code.
17    (13) Semen used for artificial insemination of livestock
18for direct agricultural production.
19    (14) Horses, or interests in horses, registered with and
20meeting the requirements of any of the Arabian Horse Club
21Registry of America, Appaloosa Horse Club, American Quarter
22Horse Association, United States Trotting Association, or
23Jockey Club, as appropriate, used for purposes of breeding or
24racing for prizes. This item (14) is exempt from the provisions
25of Section 3-75, and the exemption provided for under this item
26(14) applies for all periods beginning May 30, 1995, but no

 

 

HB2867- 23 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 24 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 25 -LRB097 10601 HLH 50977 b

1manufacturer or retailer that is registered in this State to a
2corporation, society, association, foundation, or institution
3that has been issued a sales tax exemption identification
4number by the Department that assists victims of the disaster
5who reside within the declared disaster area.
6    (18) Beginning with taxable years ending on or after
7December 31, 1995 and ending with taxable years ending on or
8before December 31, 2004, personal property that is used in the
9performance of infrastructure repairs in this State, including
10but not limited to municipal roads and streets, access roads,
11bridges, sidewalks, waste disposal systems, water and sewer
12line extensions, water distribution and purification
13facilities, storm water drainage and retention facilities, and
14sewage treatment facilities, resulting from a State or
15federally declared disaster in Illinois or bordering Illinois
16when such repairs are initiated on facilities located in the
17declared disaster area within 6 months after the disaster.
18    (19) Beginning July 1, 1999, game or game birds purchased
19at a "game breeding and hunting preserve area" or an "exotic
20game hunting area" as those terms are used in the Wildlife Code
21or at a hunting enclosure approved through rules adopted by the
22Department of Natural Resources. This paragraph is exempt from
23the provisions of Section 3-75.
24    (20) A motor vehicle, as that term is defined in Section
251-146 of the Illinois Vehicle Code, that is donated to a
26corporation, limited liability company, society, association,

 

 

HB2867- 26 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 27 -LRB097 10601 HLH 50977 b

1purpose of resale by the fundraising entity and that profits
2from the sale to the fundraising entity. This paragraph is
3exempt from the provisions of Section 3-75.
4    (22) Beginning January 1, 2000 and through December 31,
52001, new or used automatic vending machines that prepare and
6serve hot food and beverages, including coffee, soup, and other
7items, and replacement parts for these machines. Beginning
8January 1, 2002 and through June 30, 2003, machines and parts
9for machines used in commercial, coin-operated amusement and
10vending business if a use or occupation tax is paid on the
11gross receipts derived from the use of the commercial,
12coin-operated amusement and vending machines. This paragraph
13is exempt from the provisions of Section 3-75.
14    (23) Beginning August 23, 2001 and through June 30, 2011,
15food for human consumption that is to be consumed off the
16premises where it is sold (other than alcoholic beverages, soft
17drinks, and food that has been prepared for immediate
18consumption) and prescription and nonprescription medicines,
19drugs, medical appliances, and insulin, urine testing
20materials, syringes, and needles used by diabetics, for human
21use, when purchased for use by a person receiving medical
22assistance under Article V of the Illinois Public Aid Code who
23resides in a licensed long-term care facility, as defined in
24the Nursing Home Care Act, or in a licensed facility as defined
25in the MR/DD Community Care Act.
26    (24) Beginning on the effective date of this amendatory Act

 

 

HB2867- 28 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 29 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 30 -LRB097 10601 HLH 50977 b

1    (27) Beginning January 1, 2010, materials, parts,
2equipment, components, and furnishings incorporated into or
3upon an aircraft as part of the modification, refurbishment,
4completion, replacement, repair, or maintenance of the
5aircraft. This exemption includes consumable supplies used in
6the modification, refurbishment, completion, replacement,
7repair, and maintenance of aircraft, but excludes any
8materials, parts, equipment, components, and consumable
9supplies used in the modification, replacement, repair, and
10maintenance of aircraft engines or power plants, whether such
11engines or power plants are installed or uninstalled upon any
12such aircraft. "Consumable supplies" include, but are not
13limited to, adhesive, tape, sandpaper, general purpose
14lubricants, cleaning solution, latex gloves, and protective
15films. This exemption applies only to those organizations that
16(i) hold an Air Agency Certificate and are empowered to operate
17an approved repair station by the Federal Aviation
18Administration, (ii) have a Class IV Rating, and (iii) conduct
19operations in accordance with Part 145 of the Federal Aviation
20Regulations. The exemption does not include aircraft operated
21by a commercial air carrier providing scheduled passenger air
22service pursuant to authority issued under Part 121 or Part 129
23of the Federal Aviation Regulations.
24    (28) Tangible personal property purchased by a
25public-facilities corporation, as described in Section
2611-65-10 of the Illinois Municipal Code, for purposes of

 

 

HB2867- 31 -LRB097 10601 HLH 50977 b

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 instruments
7issued by the public-facilities corporation in connection with
8the development of the municipal convention hall. This
9exemption includes existing public-facilities corporations as
10provided in Section 11-65-25 of the Illinois Municipal Code.
11This paragraph is exempt from the provisions of Section 3-75.
12    (29) On and after July 1, 2011 and through June 30, 2016, a
13qualified plug-in electric drive vehicle that (i) is a
144-wheeled motor vehicle, (ii) is made by a manufacturer
15primarily for use on public streets, roads, and highways, (iii)
16has not been modified from the original manufacturer
17specifications, (iv) is acquired for use or lease by the
18purchaser or lessor and not for resale, (v) is rated at not
19more than 8,500 pounds unloaded gross vehicle weight, (vi) has
20a maximum speed capability of at least 65 miles per hour, (vii)
21is propelled to a significant extent by an electric motor that
22draws electricity from a battery that has a capacity of not
23less than 4 kilowatt hours and is capable of being recharged
24from an external source of electricity, and (viii) is acquired
25by the purchaser or lessor on or after July 1, 2011 and through
26June 30, 2016.

 

 

HB2867- 32 -LRB097 10601 HLH 50977 b

1(Source: P.A. 95-88, eff. 1-1-08; 95-538, eff. 1-1-08; 95-876,
2eff. 8-21-08; 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
396-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
47-2-10.)
 
5    Section 15. The Service Occupation Tax Act is amended by
6changing Section 3-5 as follows:
 
7    (35 ILCS 115/3-5)
8    Sec. 3-5. Exemptions. The following tangible personal
9property is exempt from the tax imposed by this Act:
10    (1) Personal property sold by a corporation, society,
11association, foundation, institution, or organization, other
12than a limited liability company, that is organized and
13operated as a not-for-profit service enterprise for the benefit
14of persons 65 years of age or older if the personal property
15was not purchased by the enterprise for the purpose of resale
16by the enterprise.
17    (2) Personal property purchased by a not-for-profit
18Illinois county fair association for use in conducting,
19operating, or promoting the county fair.
20    (3) Personal property purchased by any not-for-profit arts
21or cultural organization that establishes, by proof required by
22the Department by rule, that it has received an exemption under
23Section 501(c)(3) of the Internal Revenue Code and that is
24organized and operated primarily for the presentation or

 

 

HB2867- 33 -LRB097 10601 HLH 50977 b

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 the effective date
7of this amendatory Act of the 92nd General Assembly, however,
8an entity otherwise eligible for this exemption shall not make
9tax-free purchases unless it has an active identification
10number issued by the Department.
11    (4) Legal tender, currency, medallions, or gold or silver
12coinage issued by the State of Illinois, the government of the
13United States of America, or the government of any foreign
14country, and bullion.
15    (5) Until July 1, 2003 and beginning again on September 1,
162004 through August 30, 2014, graphic arts machinery and
17equipment, including repair and replacement parts, both new and
18used, and including that manufactured on special order or
19purchased for lease, certified by the purchaser to be used
20primarily for graphic arts production. Equipment includes
21chemicals or chemicals acting as catalysts but only if the
22chemicals or chemicals acting as catalysts effect a direct and
23immediate change upon a graphic arts product.
24    (6) Personal property sold by a teacher-sponsored student
25organization affiliated with an elementary or secondary school
26located in Illinois.

 

 

HB2867- 34 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 35 -LRB097 10601 HLH 50977 b

1such equipment.
2    Farm machinery and equipment also includes computers,
3sensors, software, and related equipment used primarily in the
4computer-assisted operation of production agriculture
5facilities, equipment, and activities such as, but not limited
6to, the collection, monitoring, and correlation of animal and
7crop data for the purpose of formulating animal diets and
8agricultural chemicals. This item (7) is exempt from the
9provisions of Section 3-55.
10    (8) Fuel and petroleum products sold to or used by an air
11common carrier, certified by the carrier to be used for
12consumption, shipment, or storage in the conduct of its
13business as an air common carrier, for a flight destined for or
14returning from a location or locations outside the United
15States without regard to previous or subsequent domestic
16stopovers.
17    (9) Proceeds of mandatory service charges separately
18stated on customers' bills for the purchase and consumption of
19food and beverages, to the extent that the proceeds of the
20service charge are in fact turned over as tips or as a
21substitute for tips to the employees who participate directly
22in preparing, serving, hosting or cleaning up the food or
23beverage function with respect to which the service charge is
24imposed.
25    (10) Until July 1, 2003, oil field exploration, drilling,
26and production equipment, including (i) rigs and parts of rigs,

 

 

HB2867- 36 -LRB097 10601 HLH 50977 b

1rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
2tubular goods, including casing and drill strings, (iii) pumps
3and pump-jack units, (iv) storage tanks and flow lines, (v) any
4individual replacement part for oil field exploration,
5drilling, and production equipment, and (vi) machinery and
6equipment purchased for lease; but excluding motor vehicles
7required to be registered under the Illinois Vehicle Code.
8    (11) Photoprocessing machinery and equipment, including
9repair and replacement parts, both new and used, including that
10manufactured on special order, certified by the purchaser to be
11used primarily for photoprocessing, and including
12photoprocessing machinery and equipment purchased for lease.
13    (12) Until July 1, 2003, coal exploration, mining,
14offhighway hauling, processing, maintenance, and reclamation
15equipment, including replacement parts and equipment, and
16including equipment purchased for lease, but excluding motor
17vehicles required to be registered under the Illinois Vehicle
18Code.
19    (13) Beginning January 1, 1992 and through June 30, 2011,
20food for human consumption that is to be consumed off the
21premises where it is sold (other than alcoholic beverages, soft
22drinks and food that has been prepared for immediate
23consumption) and prescription and non-prescription medicines,
24drugs, medical appliances, and insulin, urine testing
25materials, syringes, and needles used by diabetics, for human
26use, when purchased for use by a person receiving medical

 

 

HB2867- 37 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 38 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 39 -LRB097 10601 HLH 50977 b

1when such repairs are initiated on facilities located in the
2declared disaster area within 6 months after the disaster.
3    (20) Beginning July 1, 1999, game or game birds sold at a
4"game breeding and hunting preserve area" or an "exotic game
5hunting area" as those terms are used in the Wildlife Code or
6at a hunting enclosure approved through rules adopted by the
7Department of Natural Resources. This paragraph is exempt from
8the provisions of Section 3-55.
9    (21) A motor vehicle, as that term is defined in Section
101-146 of the Illinois Vehicle Code, that is donated to a
11corporation, limited liability company, society, association,
12foundation, or institution that is determined by the Department
13to be organized and operated exclusively for educational
14purposes. For purposes of this exemption, "a corporation,
15limited liability company, society, association, foundation,
16or institution organized and operated exclusively for
17educational purposes" means all tax-supported public schools,
18private schools that offer systematic instruction in useful
19branches of learning by methods common to public schools and
20that compare favorably in their scope and intensity with the
21course of study presented in tax-supported schools, and
22vocational or technical schools or institutes organized and
23operated exclusively to provide a course of study of not less
24than 6 weeks duration and designed to prepare individuals to
25follow a trade or to pursue a manual, technical, mechanical,
26industrial, business, or commercial occupation.

 

 

HB2867- 40 -LRB097 10601 HLH 50977 b

1    (22) Beginning January 1, 2000, personal property,
2including food, purchased through fundraising events for the
3benefit of a public or private elementary or secondary school,
4a group of those schools, or one or more school districts if
5the events are sponsored by an entity recognized by the school
6district that consists primarily of volunteers and includes
7parents and teachers of the school children. This paragraph
8does not apply to fundraising events (i) for the benefit of
9private home instruction or (ii) for which the fundraising
10entity purchases the personal property sold at the events from
11another individual or entity that sold the property for the
12purpose of resale by the fundraising entity and that profits
13from the sale to the fundraising entity. This paragraph is
14exempt from the provisions of Section 3-55.
15    (23) Beginning January 1, 2000 and through December 31,
162001, new or used automatic vending machines that prepare and
17serve hot food and beverages, including coffee, soup, and other
18items, and replacement parts for these machines. Beginning
19January 1, 2002 and through June 30, 2003, machines and parts
20for machines used in commercial, coin-operated amusement and
21vending business if a use or occupation tax is paid on the
22gross receipts derived from the use of the commercial,
23coin-operated amusement and vending machines. This paragraph
24is exempt from the provisions of Section 3-55.
25    (24) Beginning on the effective date of this amendatory Act
26of the 92nd General Assembly, computers and communications

 

 

HB2867- 41 -LRB097 10601 HLH 50977 b

1equipment utilized for any hospital purpose and equipment used
2in the diagnosis, analysis, or treatment of hospital patients
3sold to a lessor who leases the equipment, under a lease of one
4year or longer executed or in effect at the time of the
5purchase, to a hospital that has been issued an active tax
6exemption identification number by the Department under
7Section 1g of the Retailers' Occupation Tax Act. This paragraph
8is exempt from the provisions of Section 3-55.
9    (25) Beginning on the effective date of this amendatory Act
10of the 92nd General Assembly, personal property sold to a
11lessor who leases the property, under a lease of one year or
12longer executed or in effect at the time of the purchase, to a
13governmental body that has been issued an active tax exemption
14identification number by the Department under Section 1g of the
15Retailers' Occupation Tax Act. This paragraph is exempt from
16the provisions of Section 3-55.
17    (26) Beginning on January 1, 2002 and through June 30,
182011, tangible personal property purchased from an Illinois
19retailer by a taxpayer engaged in centralized purchasing
20activities in Illinois who will, upon receipt of the property
21in Illinois, temporarily store the property in Illinois (i) for
22the purpose of subsequently transporting it outside this State
23for use or consumption thereafter solely outside this State or
24(ii) for the purpose of being processed, fabricated, or
25manufactured into, attached to, or incorporated into other
26tangible personal property to be transported outside this State

 

 

HB2867- 42 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 43 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 44 -LRB097 10601 HLH 50977 b

1operations in accordance with Part 145 of the Federal Aviation
2Regulations. The exemption does not include aircraft operated
3by a commercial air carrier providing scheduled passenger air
4service pursuant to authority issued under Part 121 or Part 129
5of the Federal Aviation Regulations.
6    (30) On and after July 1, 2011 and through June 30, 2016, a
7qualified plug-in electric drive vehicle that (i) is a
84-wheeled motor vehicle, (ii) is made by a manufacturer
9primarily for use on public streets, roads, and highways, (iii)
10has not been modified from the original manufacturer
11specifications, (iv) is acquired for use or lease by the
12purchaser or lessor and not for resale, (v) is rated at not
13more than 8,500 pounds unloaded gross vehicle weight, (vi) has
14a maximum speed capability of at least 65 miles per hour, (vii)
15is propelled to a significant extent by an electric motor that
16draws electricity from a battery that has a capacity of not
17less than 4 kilowatt hours and is capable of being recharged
18from an external source of electricity, and (viii) is acquired
19by the purchaser or lessor on or after July 1, 2011 and through
20June 30, 2016.
21(Source: P.A. 95-88, eff. 1-1-08; 95-538, eff. 1-1-08; 95-876,
22eff. 8-21-08; 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;
2396-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.
247-2-10.)
 
25    Section 20. The Retailers' Occupation Tax Act is amended by

 

 

HB2867- 45 -LRB097 10601 HLH 50977 b

1changing Section 2-5 as follows:
 
2    (35 ILCS 120/2-5)
3    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
4sale of the following tangible personal property are exempt
5from the tax imposed by this Act:
6    (1) Farm chemicals.
7    (2) Farm machinery and equipment, both new and used,
8including that manufactured on special order, certified by the
9purchaser to be used primarily for production agriculture or
10State or federal agricultural programs, including individual
11replacement parts for the machinery and equipment, including
12machinery and equipment purchased for lease, and including
13implements of husbandry defined in Section 1-130 of the
14Illinois Vehicle Code, farm machinery and agricultural
15chemical and fertilizer spreaders, and nurse wagons required to
16be registered under Section 3-809 of the Illinois Vehicle Code,
17but excluding other motor vehicles required to be registered
18under the Illinois Vehicle Code. Horticultural polyhouses or
19hoop houses used for propagating, growing, or overwintering
20plants shall be considered farm machinery and equipment under
21this item (2). Agricultural chemical tender tanks and dry boxes
22shall include units sold separately from a motor vehicle
23required to be licensed and units sold mounted on a motor
24vehicle required to be licensed, if the selling price of the
25tender is separately stated.

 

 

HB2867- 46 -LRB097 10601 HLH 50977 b

1    Farm machinery and equipment shall include precision
2farming equipment that is installed or purchased to be
3installed on farm machinery and equipment including, but not
4limited to, tractors, harvesters, sprayers, planters, seeders,
5or spreaders. Precision farming equipment includes, but is not
6limited to, soil testing sensors, computers, monitors,
7software, global positioning and mapping systems, and other
8such equipment.
9    Farm machinery and equipment also includes computers,
10sensors, software, and related equipment used primarily in the
11computer-assisted operation of production agriculture
12facilities, equipment, and activities such as, but not limited
13to, the collection, monitoring, and correlation of animal and
14crop data for the purpose of formulating animal diets and
15agricultural chemicals. This item (7) is exempt from the
16provisions of Section 2-70.
17    (3) Until July 1, 2003, distillation machinery and
18equipment, sold as a unit or kit, assembled or installed by the
19retailer, certified by the user to be used only for the
20production of ethyl alcohol that will be used for consumption
21as motor fuel or as a component of motor fuel for the personal
22use of the user, and not subject to sale or resale.
23    (4) Until July 1, 2003 and beginning again September 1,
242004 through August 30, 2014, graphic arts machinery and
25equipment, including repair and replacement parts, both new and
26used, and including that manufactured on special order or

 

 

HB2867- 47 -LRB097 10601 HLH 50977 b

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.
6    (5) A motor vehicle of the first division, a motor vehicle
7of the second division that is a self contained motor vehicle
8designed or permanently converted to provide living quarters
9for recreational, camping, or travel use, with direct walk
10through access to the living quarters from the driver's seat,
11or a motor vehicle of the second division that is of the van
12configuration designed for the transportation of not less than
137 nor more than 16 passengers, as defined in Section 1-146 of
14the Illinois Vehicle Code, that is used for automobile renting,
15as defined in the Automobile Renting Occupation and Use Tax
16Act. This paragraph is exempt from the provisions of Section
172-70.
18    (6) Personal property sold by a teacher-sponsored student
19organization affiliated with an elementary or secondary school
20located in Illinois.
21    (7) Until July 1, 2003, proceeds of that portion of the
22selling price of a passenger car the sale of which is subject
23to the Replacement Vehicle Tax.
24    (8) Personal property sold to an Illinois county fair
25association for use in conducting, operating, or promoting the
26county fair.

 

 

HB2867- 48 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 49 -LRB097 10601 HLH 50977 b

1society, association, foundation, institution, or organization
2that has no compensated officers or employees and that is
3organized and operated primarily for the recreation of persons
455 years of age or older. A limited liability company may
5qualify for the exemption under this paragraph only if the
6limited liability company is organized and operated
7exclusively for educational purposes. On and after July 1,
81987, however, no entity otherwise eligible for this exemption
9shall make tax-free purchases unless it has an active
10identification number issued by the Department.
11    (12) Tangible personal property sold to interstate
12carriers for hire for use as rolling stock moving in interstate
13commerce or to lessors under leases of one year or longer
14executed or in effect at the time of purchase by interstate
15carriers for hire for use as rolling stock moving in interstate
16commerce and equipment operated by a telecommunications
17provider, licensed as a common carrier by the Federal
18Communications Commission, which is permanently installed in
19or affixed to aircraft moving in interstate commerce.
20    (12-5) On and after July 1, 2003 and through June 30, 2004,
21motor vehicles of the second division with a gross vehicle
22weight in excess of 8,000 pounds that are subject to the
23commercial distribution fee imposed under Section 3-815.1 of
24the Illinois Vehicle Code. Beginning on July 1, 2004 and
25through June 30, 2005, the use in this State of motor vehicles
26of the second division: (i) with a gross vehicle weight rating

 

 

HB2867- 50 -LRB097 10601 HLH 50977 b

1in excess of 8,000 pounds; (ii) that are subject to the
2commercial distribution fee imposed under Section 3-815.1 of
3the Illinois Vehicle Code; and (iii) that are primarily used
4for commercial purposes. Through June 30, 2005, this exemption
5applies to repair and replacement parts added after the initial
6purchase of such a motor vehicle if that motor vehicle is used
7in a manner that would qualify for the rolling stock exemption
8otherwise provided for in this Act. For purposes of this
9paragraph, "used for commercial purposes" means the
10transportation of persons or property in furtherance of any
11commercial or industrial enterprise whether for-hire or not.
12    (13) Proceeds from sales to owners, lessors, or shippers of
13tangible personal property that is utilized by interstate
14carriers for hire for use as rolling stock moving in interstate
15commerce and equipment operated by a telecommunications
16provider, licensed as a common carrier by the Federal
17Communications Commission, which is permanently installed in
18or affixed to aircraft moving in interstate commerce.
19    (14) Machinery and equipment that will be used by the
20purchaser, or a lessee of the purchaser, primarily in the
21process of manufacturing or assembling tangible personal
22property for wholesale or retail sale or lease, whether the
23sale or lease is made directly by the manufacturer or by some
24other person, whether the materials used in the process are
25owned by the manufacturer or some other person, or whether the
26sale or lease is made apart from or as an incident to the

 

 

HB2867- 51 -LRB097 10601 HLH 50977 b

1seller's engaging in the service occupation of producing
2machines, tools, dies, jigs, patterns, gauges, or other similar
3items of no commercial value on special order for a particular
4purchaser.
5    (15) Proceeds of mandatory service charges separately
6stated on customers' bills for purchase and consumption of food
7and beverages, to the extent that the proceeds of the service
8charge are in fact turned over as tips or as a substitute for
9tips to the employees who participate directly in preparing,
10serving, hosting or cleaning up the food or beverage function
11with respect to which the service charge is imposed.
12    (16) Petroleum products sold to a purchaser if the seller
13is prohibited by federal law from charging tax to the
14purchaser.
15    (17) Tangible personal property sold to a common carrier by
16rail or motor that receives the physical possession of the
17property in Illinois and that transports the property, or
18shares with another common carrier in the transportation of the
19property, out of Illinois on a standard uniform bill of lading
20showing the seller of the property as the shipper or consignor
21of the property to a destination outside Illinois, for use
22outside Illinois.
23    (18) Legal tender, currency, medallions, or gold or silver
24coinage issued by the State of Illinois, the government of the
25United States of America, or the government of any foreign
26country, and bullion.

 

 

HB2867- 52 -LRB097 10601 HLH 50977 b

1    (19) Until July 1 2003, oil field exploration, drilling,
2and production equipment, including (i) rigs and parts of rigs,
3rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
4tubular goods, including casing and drill strings, (iii) pumps
5and pump-jack units, (iv) storage tanks and flow lines, (v) any
6individual replacement part for oil field exploration,
7drilling, and production equipment, and (vi) machinery and
8equipment purchased for lease; but excluding motor vehicles
9required to be registered under the Illinois Vehicle Code.
10    (20) Photoprocessing machinery and equipment, including
11repair and replacement parts, both new and used, including that
12manufactured on special order, certified by the purchaser to be
13used primarily for photoprocessing, and including
14photoprocessing machinery and equipment purchased for lease.
15    (21) Until July 1, 2003, coal exploration, mining,
16offhighway hauling, processing, maintenance, and reclamation
17equipment, including replacement parts and equipment, and
18including equipment purchased for lease, but excluding motor
19vehicles required to be registered under the Illinois Vehicle
20Code.
21    (22) Fuel and petroleum products sold to or used by an air
22carrier, certified by the carrier to be used for consumption,
23shipment, or storage in the conduct of its business as an air
24common carrier, for a flight destined for or returning from a
25location or locations outside the United States without regard
26to previous or subsequent domestic stopovers.

 

 

HB2867- 53 -LRB097 10601 HLH 50977 b

1    (23) A transaction in which the purchase order is received
2by a florist who is located outside Illinois, but who has a
3florist located in Illinois deliver the property to the
4purchaser or the purchaser's donee in Illinois.
5    (24) Fuel consumed or used in the operation of ships,
6barges, or vessels that are used primarily in or for the
7transportation of property or the conveyance of persons for
8hire on rivers bordering on this State if the fuel is delivered
9by the seller to the purchaser's barge, ship, or vessel while
10it is afloat upon that bordering river.
11    (25) Except as provided in item (25-5) of this Section, a
12motor vehicle sold in this State to a nonresident even though
13the motor vehicle is delivered to the nonresident in this
14State, if the motor vehicle is not to be titled in this State,
15and if a drive-away permit is issued to the motor vehicle as
16provided in Section 3-603 of the Illinois Vehicle Code or if
17the nonresident purchaser has vehicle registration plates to
18transfer to the motor vehicle upon returning to his or her home
19state. The issuance of the drive-away permit or having the
20out-of-state registration plates to be transferred is prima
21facie evidence that the motor vehicle will not be titled in
22this State.
23    (25-5) The exemption under item (25) does not apply if the
24state in which the motor vehicle will be titled does not allow
25a reciprocal exemption for a motor vehicle sold and delivered
26in that state to an Illinois resident but titled in Illinois.

 

 

HB2867- 54 -LRB097 10601 HLH 50977 b

1The tax collected under this Act on the sale of a motor vehicle
2in this State to a resident of another state that does not
3allow a reciprocal exemption shall be imposed at a rate equal
4to the state's rate of tax on taxable property in the state in
5which the purchaser is a resident, except that the tax shall
6not exceed the tax that would otherwise be imposed under this
7Act. At the time of the sale, the purchaser shall execute a
8statement, signed under penalty of perjury, of his or her
9intent to title the vehicle in the state in which the purchaser
10is a resident within 30 days after the sale and of the fact of
11the payment to the State of Illinois of tax in an amount
12equivalent to the state's rate of tax on taxable property in
13his or her state of residence and shall submit the statement to
14the appropriate tax collection agency in his or her state of
15residence. In addition, the retailer must retain a signed copy
16of the statement in his or her records. Nothing in this item
17shall be construed to require the removal of the vehicle from
18this state following the filing of an intent to title the
19vehicle in the purchaser's state of residence if the purchaser
20titles the vehicle in his or her state of residence within 30
21days after the date of sale. The tax collected under this Act
22in accordance with this item (25-5) shall be proportionately
23distributed as if the tax were collected at the 6.25% general
24rate imposed under this Act.
25    (25-7) Beginning on July 1, 2007, no tax is imposed under
26this Act on the sale of an aircraft, as defined in Section 3 of

 

 

HB2867- 55 -LRB097 10601 HLH 50977 b

1the Illinois Aeronautics Act, if all of the following
2conditions are met:
3        (1) the aircraft leaves this State within 15 days after
4    the later of either the issuance of the final billing for
5    the sale of the aircraft, or the authorized approval for
6    return to service, completion of the maintenance record
7    entry, and completion of the test flight and ground test
8    for inspection, as required by 14 C.F.R. 91.407;
9        (2) the aircraft is not based or registered in this
10    State after the sale of the aircraft; and
11        (3) the seller retains in his or her books and records
12    and provides to the Department a signed and dated
13    certification from the purchaser, on a form prescribed by
14    the Department, certifying that the requirements of this
15    item (25-7) are met. The certificate must also include the
16    name and address of the purchaser, the address of the
17    location where the aircraft is to be titled or registered,
18    the address of the primary physical location of the
19    aircraft, and other information that the Department may
20    reasonably require.
21    For purposes of this item (25-7):
22    "Based in this State" means hangared, stored, or otherwise
23used, excluding post-sale customizations as defined in this
24Section, for 10 or more days in each 12-month period
25immediately following the date of the sale of the aircraft.
26    "Registered in this State" means an aircraft registered

 

 

HB2867- 56 -LRB097 10601 HLH 50977 b

1with the Department of Transportation, Aeronautics Division,
2or titled or registered with the Federal Aviation
3Administration to an address located in this State.
4    This paragraph (25-7) is exempt from the provisions of
5Section 2-70.
6    (26) Semen used for artificial insemination of livestock
7for direct agricultural production.
8    (27) Horses, or interests in horses, registered with and
9meeting the requirements of any of the Arabian Horse Club
10Registry of America, Appaloosa Horse Club, American Quarter
11Horse Association, United States Trotting Association, or
12Jockey Club, as appropriate, used for purposes of breeding or
13racing for prizes. This item (27) is exempt from the provisions
14of Section 2-70, and the exemption provided for under this item
15(27) applies for all periods beginning May 30, 1995, but no
16claim for credit or refund is allowed on or after January 1,
172008 (the effective date of Public Act 95-88) for such taxes
18paid during the period beginning May 30, 2000 and ending on
19January 1, 2008 (the effective date of Public Act 95-88).
20    (28) Computers and communications equipment utilized for
21any hospital purpose and equipment used in the diagnosis,
22analysis, or treatment of hospital patients sold to a lessor
23who leases the equipment, under a lease of one year or longer
24executed or in effect at the time of the purchase, to a
25hospital that has been issued an active tax exemption
26identification number by the Department under Section 1g of

 

 

HB2867- 57 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 58 -LRB097 10601 HLH 50977 b

1when such repairs are initiated on facilities located in the
2declared disaster area within 6 months after the disaster.
3    (32) Beginning July 1, 1999, game or game birds sold at a
4"game breeding and hunting preserve area" or an "exotic game
5hunting area" as those terms are used in the Wildlife Code or
6at a hunting enclosure approved through rules adopted by the
7Department of Natural Resources. This paragraph is exempt from
8the provisions of Section 2-70.
9    (33) A motor vehicle, as that term is defined in Section
101-146 of the Illinois Vehicle Code, that is donated to a
11corporation, limited liability company, society, association,
12foundation, or institution that is determined by the Department
13to be organized and operated exclusively for educational
14purposes. For purposes of this exemption, "a corporation,
15limited liability company, society, association, foundation,
16or institution organized and operated exclusively for
17educational purposes" means all tax-supported public schools,
18private schools that offer systematic instruction in useful
19branches of learning by methods common to public schools and
20that compare favorably in their scope and intensity with the
21course of study presented in tax-supported schools, and
22vocational or technical schools or institutes organized and
23operated exclusively to provide a course of study of not less
24than 6 weeks duration and designed to prepare individuals to
25follow a trade or to pursue a manual, technical, mechanical,
26industrial, business, or commercial occupation.

 

 

HB2867- 59 -LRB097 10601 HLH 50977 b

1    (34) Beginning January 1, 2000, personal property,
2including food, purchased through fundraising events for the
3benefit of a public or private elementary or secondary school,
4a group of those schools, or one or more school districts if
5the events are sponsored by an entity recognized by the school
6district that consists primarily of volunteers and includes
7parents and teachers of the school children. This paragraph
8does not apply to fundraising events (i) for the benefit of
9private home instruction or (ii) for which the fundraising
10entity purchases the personal property sold at the events from
11another individual or entity that sold the property for the
12purpose of resale by the fundraising entity and that profits
13from the sale to the fundraising entity. This paragraph is
14exempt from the provisions of Section 2-70.
15    (35) Beginning January 1, 2000 and through December 31,
162001, new or used automatic vending machines that prepare and
17serve hot food and beverages, including coffee, soup, and other
18items, and replacement parts for these machines. Beginning
19January 1, 2002 and through June 30, 2003, machines and parts
20for machines used in commercial, coin-operated amusement and
21vending business if a use or occupation tax is paid on the
22gross receipts derived from the use of the commercial,
23coin-operated amusement and vending machines. This paragraph
24is exempt from the provisions of Section 2-70.
25    (35-5) Beginning August 23, 2001 and through June 30, 2011,
26food for human consumption that is to be consumed off the

 

 

HB2867- 60 -LRB097 10601 HLH 50977 b

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

 

 

HB2867- 61 -LRB097 10601 HLH 50977 b

1    (38) Beginning on January 1, 2002 and through June 30,
22011, tangible personal property purchased from an Illinois
3retailer by a taxpayer engaged in centralized purchasing
4activities in Illinois who will, upon receipt of the property
5in Illinois, temporarily store the property in Illinois (i) for
6the purpose of subsequently transporting it outside this State
7for use or consumption thereafter solely outside this State or
8(ii) for the purpose of being processed, fabricated, or
9manufactured into, attached to, or incorporated into other
10tangible personal property to be transported outside this State
11and thereafter used or consumed solely outside this State. The
12Director of Revenue shall, pursuant to rules adopted in
13accordance with the Illinois Administrative Procedure Act,
14issue a permit to any taxpayer in good standing with the
15Department who is eligible for the exemption under this
16paragraph (38). The permit issued under this paragraph (38)
17shall authorize the holder, to the extent and in the manner
18specified in the rules adopted under this Act, to purchase
19tangible personal property from a retailer exempt from the
20taxes imposed by this Act. Taxpayers shall maintain all
21necessary books and records to substantiate the use and
22consumption of all such tangible personal property outside of
23the State of Illinois.
24    (39) Beginning January 1, 2008, tangible personal property
25used in the construction or maintenance of a community water
26supply, as defined under Section 3.145 of the Environmental

 

 

HB2867- 62 -LRB097 10601 HLH 50977 b

1Protection Act, that is operated by a not-for-profit
2corporation that holds a valid water supply permit issued under
3Title IV of the Environmental Protection Act. This paragraph is
4exempt from the provisions of Section 2-70.
5    (40) Beginning January 1, 2010, materials, parts,
6equipment, components, and furnishings incorporated into or
7upon an aircraft as part of the modification, refurbishment,
8completion, replacement, repair, or maintenance of the
9aircraft. This exemption includes consumable supplies used in
10the modification, refurbishment, completion, replacement,
11repair, and maintenance of aircraft, but excludes any
12materials, parts, equipment, components, and consumable
13supplies used in the modification, replacement, repair, and
14maintenance of aircraft engines or power plants, whether such
15engines or power plants are installed or uninstalled upon any
16such aircraft. "Consumable supplies" include, but are not
17limited to, adhesive, tape, sandpaper, general purpose
18lubricants, cleaning solution, latex gloves, and protective
19films. This exemption applies only to those organizations that
20(i) hold an Air Agency Certificate and are empowered to operate
21an approved repair station by the Federal Aviation
22Administration, (ii) have a Class IV Rating, and (iii) conduct
23operations in accordance with Part 145 of the Federal Aviation
24Regulations. The exemption does not include aircraft operated
25by a commercial air carrier providing scheduled passenger air
26service pursuant to authority issued under Part 121 or Part 129

 

 

HB2867- 63 -LRB097 10601 HLH 50977 b

1of the Federal Aviation Regulations.
2    (41) Tangible personal property sold to a
3public-facilities corporation, as described in Section
411-65-10 of the Illinois Municipal Code, for purposes of
5constructing or furnishing a municipal convention hall, but
6only if the legal title to the municipal convention hall is
7transferred to the municipality without any further
8consideration by or on behalf of the municipality at the time
9of the completion of the municipal convention hall or upon the
10retirement or redemption of any bonds or other debt instruments
11issued by the public-facilities corporation in connection with
12the development of the municipal convention hall. This
13exemption includes existing public-facilities corporations as
14provided in Section 11-65-25 of the Illinois Municipal Code.
15This paragraph is exempt from the provisions of Section 2-70.
16    (42) On and after July 1, 2011 and through June 30, 2016, a
17qualified plug-in electric drive vehicle that (i) is a
184-wheeled motor vehicle, (ii) is made by a manufacturer
19primarily for use on public streets, roads, and highways, (iii)
20has not been modified from the original manufacturer
21specifications, (iv) is acquired for use or lease by the
22purchaser or lessor and not for resale, (v) is rated at not
23more than 8,500 pounds unloaded gross vehicle weight, (vi) has
24a maximum speed capability of at least 65 miles per hour, (vii)
25is propelled to a significant extent by an electric motor that
26draws electricity from a battery that has a capacity of not

 

 

HB2867- 64 -LRB097 10601 HLH 50977 b

1less than 4 kilowatt hours and is capable of being recharged
2from an external source of electricity, and (viii) is acquired
3by the purchaser or lessor on or after July 1, 2011 and through
4June 30, 2016.
5(Source: P.A. 95-88, eff. 1-1-08; 95-233, eff. 8-16-07; 95-304,
6eff. 8-20-07; 95-538, eff. 1-1-08; 95-707, eff. 1-11-08;
795-876, eff. 8-21-08; 96-116, eff. 7-31-09; 96-339, eff.
87-1-10; 96-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000,
9eff. 7-2-10.)
 
10    Section 99. Effective date. This Act takes effect July 1,
112011.