97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB5362

 

Introduced 2/15/2012, by Rep. Mike Fortner

 

SYNOPSIS AS INTRODUCED:
 
65 ILCS 5/8-11-1.3  from Ch. 24, par. 8-11-1.3
65 ILCS 5/8-11-1.4  from Ch. 24, par. 8-11-1.4
65 ILCS 5/8-11-1.5  from Ch. 24, par. 8-11-1.5

    Amends the Illinois Municipal Code. Provides that the corporate authorities of a non-home rule municipality may use (now, until December 31, 2015) the proceeds of a tax imposed under the Non-Home Rule Municipal Retailers' Occupation Tax Act, Non-Home Rule Municipal Service Occupation Tax Act, or the Non-Home Rule Municipal Use Tax Act for expenditure on municipal operations, in addition to or in lieu of any expenditure on public infrastructure or for property tax relief. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

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1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Municipal Code is amended by
5changing Sections 8-11-1.3, 8-11-1.4, and 8-11-1.5 as follows:
 
6    (65 ILCS 5/8-11-1.3)  (from Ch. 24, par. 8-11-1.3)
7    Sec. 8-11-1.3. Non-Home Rule Municipal Retailers'
8Occupation Tax Act. The corporate authorities of a non-home
9rule municipality may impose a tax upon all persons engaged in
10the business of selling tangible personal property, other than
11on an item of tangible personal property which is titled and
12registered by an agency of this State's Government, at retail
13in the municipality for expenditure on public infrastructure or
14for property tax relief or both as defined in Section 8-11-1.2
15if approved by referendum as provided in Section 8-11-1.1, of
16the gross receipts from such sales made in the course of such
17business. If the tax is approved by referendum on or after July
1814, 2010 (the effective date of Public Act 96-1057), the
19corporate authorities of a non-home rule municipality may,
20until December 31, 2015, use the proceeds of the tax for
21expenditure on municipal operations, in addition to or in lieu
22of any expenditure on public infrastructure or for property tax
23relief. The tax imposed may not be more than 1% and may be

 

 

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1imposed only in 1/4% increments. The tax may not be imposed on
2the sale of food for human consumption that is to be consumed
3off the premises where it is sold (other than alcoholic
4beverages, soft drinks, and food that has been prepared for
5immediate consumption) and prescription and nonprescription
6medicines, drugs, medical appliances, and insulin, urine
7testing materials, syringes, and needles used by diabetics. The
8tax imposed by a municipality pursuant to this Section and all
9civil penalties that may be assessed as an incident thereof
10shall be collected and enforced by the State Department of
11Revenue. The certificate of registration which is issued by the
12Department to a retailer under the Retailers' Occupation Tax
13Act shall permit such retailer to engage in a business which is
14taxable under any ordinance or resolution enacted pursuant to
15this Section without registering separately with the
16Department under such ordinance or resolution or under this
17Section. The Department shall have full power to administer and
18enforce this Section; to collect all taxes and penalties due
19hereunder; to dispose of taxes and penalties so collected in
20the manner hereinafter provided, and to determine all rights to
21credit memoranda, arising on account of the erroneous payment
22of tax or penalty hereunder. In the administration of, and
23compliance with, this Section, the Department and persons who
24are subject to this Section shall have the same rights,
25remedies, privileges, immunities, powers and duties, and be
26subject to the same conditions, restrictions, limitations,

 

 

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1penalties and definitions of terms, and employ the same modes
2of procedure, as are prescribed in Sections 1, 1a, 1a-1, 1d,
31e, 1f, 1i, 1j, 2 through 2-65 (in respect to all provisions
4therein other than the State rate of tax), 2c, 3 (except as to
5the disposition of taxes and penalties collected), 4, 5, 5a,
65b, 5c, 5d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8,
79, 10, 11, 12 and 13 of the Retailers' Occupation Tax Act and
8Section 3-7 of the Uniform Penalty and Interest Act as fully as
9if those provisions were set forth herein.
10    No municipality may impose a tax under this Section unless
11the municipality also imposes a tax at the same rate under
12Section 8-11-1.4 of this Code.
13    Persons subject to any tax imposed pursuant to the
14authority granted in this Section may reimburse themselves for
15their seller's tax liability hereunder by separately stating
16such tax as an additional charge, which charge may be stated in
17combination, in a single amount, with State tax which sellers
18are required to collect under the Use Tax Act, pursuant to such
19bracket schedules as the Department may prescribe.
20    Whenever the Department determines that a refund should be
21made under this Section to a claimant instead of issuing a
22credit memorandum, the Department shall notify the State
23Comptroller, who shall cause the order to be drawn for the
24amount specified, and to the person named, in such notification
25from the Department. Such refund shall be paid by the State
26Treasurer out of the non-home rule municipal retailers'

 

 

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1occupation tax fund.
2    The Department shall forthwith pay over to the State
3Treasurer, ex officio, as trustee, all taxes and penalties
4collected hereunder.
5    As soon as possible after the first day of each month,
6beginning January 1, 2011, upon certification of the Department
7of Revenue, the Comptroller shall order transferred, and the
8Treasurer shall transfer, to the STAR Bonds Revenue Fund the
9local sales tax increment, as defined in the Innovation
10Development and Economy Act, collected under this Section
11during the second preceding calendar month for sales within a
12STAR bond district.
13    After the monthly transfer to the STAR Bonds Revenue Fund,
14on or before the 25th day of each calendar month, the
15Department shall prepare and certify to the Comptroller the
16disbursement of stated sums of money to named municipalities,
17the municipalities to be those from which retailers have paid
18taxes or penalties hereunder to the Department during the
19second preceding calendar month. The amount to be paid to each
20municipality shall be the amount (not including credit
21memoranda) collected hereunder during the second preceding
22calendar month by the Department plus an amount the Department
23determines is necessary to offset any amounts which were
24erroneously paid to a different taxing body, and not including
25an amount equal to the amount of refunds made during the second
26preceding calendar month by the Department on behalf of such

 

 

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1municipality, and not including any amount which the Department
2determines is necessary to offset any amounts which were
3payable to a different taxing body but were erroneously paid to
4the municipality, and not including any amounts that are
5transferred to the STAR Bonds Revenue Fund. Within 10 days
6after receipt, by the Comptroller, of the disbursement
7certification to the municipalities, provided for in this
8Section to be given to the Comptroller by the Department, the
9Comptroller shall cause the orders to be drawn for the
10respective amounts in accordance with the directions contained
11in such certification.
12    For the purpose of determining the local governmental unit
13whose tax is applicable, a retail sale, by a producer of coal
14or other mineral mined in Illinois, is a sale at retail at the
15place where the coal or other mineral mined in Illinois is
16extracted from the earth. This paragraph does not apply to coal
17or other mineral when it is delivered or shipped by the seller
18to the purchaser at a point outside Illinois so that the sale
19is exempt under the Federal Constitution as a sale in
20interstate or foreign commerce.
21    Nothing in this Section shall be construed to authorize a
22municipality to impose a tax upon the privilege of engaging in
23any business which under the constitution of the United States
24may not be made the subject of taxation by this State.
25    When certifying the amount of a monthly disbursement to a
26municipality under this Section, the Department shall increase

 

 

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1or decrease such amount by an amount necessary to offset any
2misallocation of previous disbursements. The offset amount
3shall be the amount erroneously disbursed within the previous 6
4months from the time a misallocation is discovered.
5    The Department of Revenue shall implement this amendatory
6Act of the 91st General Assembly so as to collect the tax on
7and after January 1, 2002.
8    As used in this Section, "municipal" and "municipality"
9means a city, village or incorporated town, including an
10incorporated town which has superseded a civil township.
11    This Section shall be known and may be cited as the
12"Non-Home Rule Municipal Retailers' Occupation Tax Act".
13(Source: P.A. 96-939, eff. 6-24-10; 96-1057, eff. 7-14-10;
1497-333, eff. 8-12-11.)
 
15    (65 ILCS 5/8-11-1.4)  (from Ch. 24, par. 8-11-1.4)
16    Sec. 8-11-1.4. Non-Home Rule Municipal Service Occupation
17Tax Act. The corporate authorities of a non-home rule
18municipality may impose a tax upon all persons engaged, in such
19municipality, in the business of making sales of service for
20expenditure on public infrastructure or for property tax relief
21or both as defined in Section 8-11-1.2 if approved by
22referendum as provided in Section 8-11-1.1, of the selling
23price of all tangible personal property transferred by such
24servicemen either in the form of tangible personal property or
25in the form of real estate as an incident to a sale of service.

 

 

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1If the tax is approved by referendum on or after July 14, 2010
2(the effective date of Public Act 96-1057), the corporate
3authorities of a non-home rule municipality may, until December
431, 2015, use the proceeds of the tax for expenditure on
5municipal operations, in addition to or in lieu of any
6expenditure on public infrastructure or for property tax
7relief. The tax imposed may not be more than 1% and may be
8imposed only in 1/4% increments. The tax may not be imposed on
9the sale of food for human consumption that is to be consumed
10off the premises where it is sold (other than alcoholic
11beverages, soft drinks, and food that has been prepared for
12immediate consumption) and prescription and nonprescription
13medicines, drugs, medical appliances, and insulin, urine
14testing materials, syringes, and needles used by diabetics. The
15tax imposed by a municipality pursuant to this Section and all
16civil penalties that may be assessed as an incident thereof
17shall be collected and enforced by the State Department of
18Revenue. The certificate of registration which is issued by the
19Department to a retailer under the Retailers' Occupation Tax
20Act or under the Service Occupation Tax Act shall permit such
21registrant to engage in a business which is taxable under any
22ordinance or resolution enacted pursuant to this Section
23without registering separately with the Department under such
24ordinance or resolution or under this Section. The Department
25shall have full power to administer and enforce this Section;
26to collect all taxes and penalties due hereunder; to dispose of

 

 

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1taxes and penalties so collected in the manner hereinafter
2provided, and to determine all rights to credit memoranda
3arising on account of the erroneous payment of tax or penalty
4hereunder. In the administration of, and compliance with, this
5Section the Department and persons who are subject to this
6Section shall have the same rights, remedies, privileges,
7immunities, powers and duties, and be subject to the same
8conditions, restrictions, limitations, penalties and
9definitions of terms, and employ the same modes of procedure,
10as are prescribed in Sections 1a-1, 2, 2a, 3 through 3-50 (in
11respect to all provisions therein other than the State rate of
12tax), 4 (except that the reference to the State shall be to the
13taxing municipality), 5, 7, 8 (except that the jurisdiction to
14which the tax shall be a debt to the extent indicated in that
15Section 8 shall be the taxing municipality), 9 (except as to
16the disposition of taxes and penalties collected, and except
17that the returned merchandise credit for this municipal tax may
18not be taken against any State tax), 10, 11, 12 (except the
19reference therein to Section 2b of the Retailers' Occupation
20Tax Act), 13 (except that any reference to the State shall mean
21the taxing municipality), the first paragraph of Section 15,
2216, 17, 18, 19 and 20 of the Service Occupation Tax Act and
23Section 3-7 of the Uniform Penalty and Interest Act, as fully
24as if those provisions were set forth herein.
25    No municipality may impose a tax under this Section unless
26the municipality also imposes a tax at the same rate under

 

 

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1Section 8-11-1.3 of this Code.
2    Persons subject to any tax imposed pursuant to the
3authority granted in this Section may reimburse themselves for
4their serviceman's tax liability hereunder by separately
5stating such tax as an additional charge, which charge may be
6stated in combination, in a single amount, with State tax which
7servicemen are authorized to collect under the Service Use Tax
8Act, pursuant to such bracket schedules as the Department may
9prescribe.
10    Whenever the Department determines that a refund should be
11made under this Section to a claimant instead of issuing credit
12memorandum, the Department shall notify the State Comptroller,
13who shall cause the order to be drawn for the amount specified,
14and to the person named, in such notification from the
15Department. Such refund shall be paid by the State Treasurer
16out of the municipal retailers' occupation tax fund.
17    The Department shall forthwith pay over to the State
18Treasurer, ex officio, as trustee, all taxes and penalties
19collected hereunder.
20    As soon as possible after the first day of each month,
21beginning January 1, 2011, upon certification of the Department
22of Revenue, the Comptroller shall order transferred, and the
23Treasurer shall transfer, to the STAR Bonds Revenue Fund the
24local sales tax increment, as defined in the Innovation
25Development and Economy Act, collected under this Section
26during the second preceding calendar month for sales within a

 

 

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1STAR bond district.
2    After the monthly transfer to the STAR Bonds Revenue Fund,
3on or before the 25th day of each calendar month, the
4Department shall prepare and certify to the Comptroller the
5disbursement of stated sums of money to named municipalities,
6the municipalities to be those from which suppliers and
7servicemen have paid taxes or penalties hereunder to the
8Department during the second preceding calendar month. The
9amount to be paid to each municipality shall be the amount (not
10including credit memoranda) collected hereunder during the
11second preceding calendar month by the Department, and not
12including an amount equal to the amount of refunds made during
13the second preceding calendar month by the Department on behalf
14of such municipality, and not including any amounts that are
15transferred to the STAR Bonds Revenue Fund. Within 10 days
16after receipt, by the Comptroller, of the disbursement
17certification to the municipalities and the General Revenue
18Fund, provided for in this Section to be given to the
19Comptroller by the Department, the Comptroller shall cause the
20orders to be drawn for the respective amounts in accordance
21with the directions contained in such certification.
22    The Department of Revenue shall implement this amendatory
23Act of the 91st General Assembly so as to collect the tax on
24and after January 1, 2002.
25    Nothing in this Section shall be construed to authorize a
26municipality to impose a tax upon the privilege of engaging in

 

 

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1any business which under the constitution of the United States
2may not be made the subject of taxation by this State.
3    As used in this Section, "municipal" or "municipality"
4means or refers to a city, village or incorporated town,
5including an incorporated town which has superseded a civil
6township.
7    This Section shall be known and may be cited as the
8"Non-Home Rule Municipal Service Occupation Tax Act".
9(Source: P.A. 96-939, eff. 6-24-10; 96-1057, eff. 7-14-10;
1097-333, eff. 8-12-11.)
 
11    (65 ILCS 5/8-11-1.5)  (from Ch. 24, par. 8-11-1.5)
12    Sec. 8-11-1.5. Non-Home Rule Municipal Use Tax Act. The
13corporate authorities of a non-home rule municipality may
14impose a tax upon the privilege of using, in such municipality,
15any item of tangible personal property which is purchased at
16retail from a retailer, and which is titled or registered with
17an agency of this State's government, based on the selling
18price of such tangible personal property, as "selling price" is
19defined in the Use Tax Act, for expenditure on public
20infrastructure or for property tax relief or both as defined in
21Section 8-11-1.2, if approved by referendum as provided in
22Section 8-11-1.1. If the tax is approved by referendum on or
23after the effective date of this amendatory Act of the 96th
24General Assembly, the corporate authorities of a non-home rule
25municipality may, until December 31, 2015, use the proceeds of

 

 

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1the tax for expenditure on municipal operations, in addition to
2or in lieu of any expenditure on public infrastructure or for
3property tax relief. The tax imposed may not be more than 1%
4and may be imposed only in 1/4% increments. Such tax shall be
5collected from persons whose Illinois address for title or
6registration purposes is given as being in such municipality.
7Such tax shall be collected by the municipality imposing such
8tax. A non-home rule municipality may not impose and collect
9the tax prior to January 1, 2002.
10    This Section shall be known and may be cited as the
11"Non-Home Rule Municipal Use Tax Act".
12(Source: P.A. 96-1057, eff. 7-14-10.)
 
13    Section 99. Effective date. This Act takes effect upon
14becoming law.