Illinois General Assembly - Full Text of HB4381
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Full Text of HB4381  102nd General Assembly

HB4381 102ND GENERAL ASSEMBLY

  
  

 


 
102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB4381

 

Introduced 1/21/2022, by Rep. Paul Jacobs, Tony McCombie and Chris Bos

 

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

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Reduces the rate of tax on diapers and baby wipes to 1% (currently, 6.25%). Makes various formatting changes.


LRB102 22272 HLH 31405 b

 

 

A BILL FOR

 

HB4381LRB102 22272 HLH 31405 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
53-10 as follows:
 
6    (35 ILCS 105/3-10)
7    Sec. 3-10. Rate of tax. Unless otherwise provided in this
8Section, the tax imposed by this Act is at the rate of 6.25% of
9either the selling price or the fair market value, if any, of
10the tangible personal property. In all cases where property
11functionally used or consumed is the same as the property that
12was purchased at retail, then the tax is imposed on the selling
13price of the property. In all cases where property
14functionally used or consumed is a by-product or waste product
15that has been refined, manufactured, or produced from property
16purchased at retail, then the tax is imposed on the lower of
17the fair market value, if any, of the specific property so used
18in this State or on the selling price of the property purchased
19at retail. For purposes of this Section "fair market value"
20means the price at which property would change hands between a
21willing buyer and a willing seller, neither being under any
22compulsion to buy or sell and both having reasonable knowledge
23of the relevant facts. The fair market value shall be

 

 

HB4381- 2 -LRB102 22272 HLH 31405 b

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

 

 

HB4381- 3 -LRB102 22272 HLH 31405 b

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

 

 

HB4381- 4 -LRB102 22272 HLH 31405 b

1    well as any accessories and components related to those
2    devices;
3        (4) modifications to a motor vehicle for the purpose
4    of rendering it usable by a person with a disability;
5        (5) insulin, blood sugar testing materials, syringes,
6    and needles used by human diabetics; and
7        (6) diapers and baby wipes. food for human consumption
8    that is to be consumed off the premises where it is sold
9    (other than alcoholic beverages, food consisting of or
10    infused with adult use cannabis, soft drinks, and food
11    that has been prepared for immediate consumption) and
12    prescription and nonprescription medicines, drugs, medical
13    appliances, products classified as Class III medical
14    devices by the United States Food and Drug Administration
15    that are used for cancer treatment pursuant to a
16    prescription, as well as any accessories and components
17    related to those devices, modifications to a motor vehicle
18    for the purpose of rendering it usable by a person with a
19    disability, and insulin, blood sugar testing materials,
20    syringes, and needles used by human diabetics, the tax is
21    imposed at the rate of 1%.
22    For the purposes of this Section, until September 1, 2009:
23the term "soft drinks" means any complete, finished,
24ready-to-use, non-alcoholic drink, whether carbonated or not,
25including but not limited to soda water, cola, fruit juice,
26vegetable juice, carbonated water, and all other preparations

 

 

HB4381- 5 -LRB102 22272 HLH 31405 b

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

 

 

HB4381- 6 -LRB102 22272 HLH 31405 b

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

 

 

HB4381- 7 -LRB102 22272 HLH 31405 b

1the 98th General Assembly, "prescription and nonprescription
2medicines and drugs" includes medical cannabis purchased from
3a registered dispensing organization under the Compassionate
4Use of Medical Cannabis Program Act.
5    As used in this Section, "adult use cannabis" means
6cannabis subject to tax under the Cannabis Cultivation
7Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
8and does not include cannabis subject to tax under the
9Compassionate Use of Medical Cannabis Program Act.
10    If the property that is purchased at retail from a
11retailer is acquired outside Illinois and used outside
12Illinois before being brought to Illinois for use here and is
13taxable under this Act, the "selling price" on which the tax is
14computed shall be reduced by an amount that represents a
15reasonable allowance for depreciation for the period of prior
16out-of-state use.
17(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
18102-4, eff. 4-27-21.)
 
19    Section 10. The Service Use Tax Act is amended by changing
20Section 3-10 as follows:
 
21    (35 ILCS 110/3-10)  (from Ch. 120, par. 439.33-10)
22    Sec. 3-10. Rate of tax. Unless otherwise provided in this
23Section, the tax imposed by this Act is at the rate of 6.25% of
24the selling price of tangible personal property transferred as

 

 

HB4381- 8 -LRB102 22272 HLH 31405 b

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

 

 

HB4381- 9 -LRB102 22272 HLH 31405 b

1the tax imposed by this Act applies to (i) 80% of the selling
2price of property transferred as an incident to the sale of
3service on or after July 1, 2003 and on or before December 31,
42018 and (ii) 100% of the proceeds of the selling price
5thereafter. If, at any time, however, the tax under this Act on
6sales of biodiesel blends, as defined in the Use Tax Act, with
7no less than 1% and no more than 10% biodiesel is imposed at
8the rate of 1.25%, then the tax imposed by this Act applies to
9100% of the proceeds of sales of biodiesel blends with no less
10than 1% and no more than 10% biodiesel made during that time.
11    With respect to 100% biodiesel, as defined in the Use Tax
12Act, and biodiesel blends, as defined in the Use Tax Act, with
13more than 10% but no more than 99% biodiesel, the tax imposed
14by this Act does not apply to the proceeds of the selling price
15of property transferred as an incident to the sale of service
16on or after July 1, 2003 and on or before December 31, 2023 but
17applies to 100% of the selling price thereafter.
18    At the election of any registered serviceman made for each
19fiscal year, sales of service in which the aggregate annual
20cost price of tangible personal property transferred as an
21incident to the sales of service is less than 35%, or 75% in
22the case of servicemen transferring prescription drugs or
23servicemen engaged in graphic arts production, of the
24aggregate annual total gross receipts from all sales of
25service, the tax imposed by this Act shall be based on the
26serviceman's cost price of the tangible personal property

 

 

HB4381- 10 -LRB102 22272 HLH 31405 b

1transferred as an incident to the sale of those services.
2    The tax shall be imposed at the rate of 1% on food prepared
3for immediate consumption and transferred incident to a sale
4of service subject to this Act or the Service Occupation Tax
5Act by an entity licensed under the Hospital Licensing Act,
6the Nursing Home Care Act, the Assisted Living and Shared
7Housing Act, the ID/DD Community Care Act, the MC/DD Act, the
8Specialized Mental Health Rehabilitation Act of 2013, or the
9Child Care Act of 1969, or an entity that holds a permit issued
10pursuant to the Life Care Facilities Act. The tax shall also be
11imposed at the rate of 1% on the following items:
12        (1) food for human consumption that is to be consumed
13    off the premises where it is sold (other than alcoholic
14    beverages, food consisting of or infused with adult use
15    cannabis, soft drinks, and food that has been prepared for
16    immediate consumption and is not otherwise included in
17    this paragraph);
18        (2) prescription and nonprescription medicines, drugs,
19    and medical appliances;
20        (3) products classified as Class III medical devices
21    by the United States Food and Drug Administration that are
22    used for cancer treatment pursuant to a prescription, as
23    well as any accessories and components related to those
24    devices;
25        (4) modifications to a motor vehicle for the purpose
26    of rendering it usable by a person with a disability;

 

 

HB4381- 11 -LRB102 22272 HLH 31405 b

1        (5) insulin, blood sugar testing materials, syringes,
2    and needles used by human diabetics; and
3        (6) diapers and baby wipes.
4food for human consumption that is to be consumed off the
5premises where it is sold (other than alcoholic beverages,
6food consisting of or infused with adult use cannabis, soft
7drinks, and food that has been prepared for immediate
8consumption and is not otherwise included in this paragraph)
9and prescription and nonprescription medicines, drugs, medical
10appliances, products classified as Class III medical devices
11by the United States Food and Drug Administration that are
12used for cancer treatment pursuant to a prescription, as well
13as any accessories and components related to those devices,
14modifications to a motor vehicle for the purpose of rendering
15it usable by a person with a disability, and insulin, blood
16sugar testing materials, syringes, and needles used by human
17diabetics.
18    For the purposes of this Section, until September 1, 2009:
19the term "soft drinks" means any complete, finished,
20ready-to-use, non-alcoholic drink, whether carbonated or not,
21including but not limited to soda water, cola, fruit juice,
22vegetable juice, carbonated water, and all other preparations
23commonly known as soft drinks of whatever kind or description
24that are contained in any closed or sealed bottle, can,
25carton, or container, regardless of size; but "soft drinks"
26does not include coffee, tea, non-carbonated water, infant

 

 

HB4381- 12 -LRB102 22272 HLH 31405 b

1formula, milk or milk products as defined in the Grade A
2Pasteurized Milk and Milk Products Act, or drinks containing
350% or more natural fruit or vegetable juice.
4    Notwithstanding any other provisions of this Act,
5beginning September 1, 2009, "soft drinks" means non-alcoholic
6beverages that contain natural or artificial sweeteners. "Soft
7drinks" do not include beverages that contain milk or milk
8products, soy, rice or similar milk substitutes, or greater
9than 50% of vegetable or fruit juice by volume.
10    Until August 1, 2009, and notwithstanding any other
11provisions of this Act, "food for human consumption that is to
12be consumed off the premises where it is sold" includes all
13food sold through a vending machine, except soft drinks and
14food products that are dispensed hot from a vending machine,
15regardless of the location of the vending machine. Beginning
16August 1, 2009, and notwithstanding any other provisions of
17this Act, "food for human consumption that is to be consumed
18off the premises where it is sold" includes all food sold
19through a vending machine, except soft drinks, candy, and food
20products that are dispensed hot from a vending machine,
21regardless of the location of the vending machine.
22    Notwithstanding any other provisions of this Act,
23beginning September 1, 2009, "food for human consumption that
24is to be consumed off the premises where it is sold" does not
25include candy. For purposes of this Section, "candy" means a
26preparation of sugar, honey, or other natural or artificial

 

 

HB4381- 13 -LRB102 22272 HLH 31405 b

1sweeteners in combination with chocolate, fruits, nuts or
2other ingredients or flavorings in the form of bars, drops, or
3pieces. "Candy" does not include any preparation that contains
4flour or requires refrigeration.
5    Notwithstanding any other provisions of this Act,
6beginning September 1, 2009, "nonprescription medicines and
7drugs" does not include grooming and hygiene products. For
8purposes of this Section, "grooming and hygiene products"
9includes, but is not limited to, soaps and cleaning solutions,
10shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
11lotions and screens, unless those products are available by
12prescription only, regardless of whether the products meet the
13definition of "over-the-counter-drugs". For the purposes of
14this paragraph, "over-the-counter-drug" means a drug for human
15use that contains a label that identifies the product as a drug
16as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
17label includes:
18        (A) A "Drug Facts" panel; or
19        (B) A statement of the "active ingredient(s)" with a
20    list of those ingredients contained in the compound,
21    substance or preparation.
22    Beginning on January 1, 2014 (the effective date of Public
23Act 98-122), "prescription and nonprescription medicines and
24drugs" includes medical cannabis purchased from a registered
25dispensing organization under the Compassionate Use of Medical
26Cannabis Program Act.

 

 

HB4381- 14 -LRB102 22272 HLH 31405 b

1    As used in this Section, "adult use cannabis" means
2cannabis subject to tax under the Cannabis Cultivation
3Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
4and does not include cannabis subject to tax under the
5Compassionate Use of Medical Cannabis Program Act.
6    If the property that is acquired from a serviceman is
7acquired outside Illinois and used outside Illinois before
8being brought to Illinois for use here and is taxable under
9this Act, the "selling price" on which the tax is computed
10shall be reduced by an amount that represents a reasonable
11allowance for depreciation for the period of prior
12out-of-state use.
13(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
14102-4, eff. 4-27-21; 102-16, eff. 6-17-21.)
 
15    Section 15. The Service Occupation Tax Act is amended by
16changing Section 3-10 as follows:
 
17    (35 ILCS 115/3-10)  (from Ch. 120, par. 439.103-10)
18    Sec. 3-10. Rate of tax. Unless otherwise provided in this
19Section, the tax imposed by this Act is at the rate of 6.25% of
20the "selling price", as defined in Section 2 of the Service Use
21Tax Act, of the tangible personal property. For the purpose of
22computing this tax, in no event shall the "selling price" be
23less than the cost price to the serviceman of the tangible
24personal property transferred. The selling price of each item

 

 

HB4381- 15 -LRB102 22272 HLH 31405 b

1of tangible personal property transferred as an incident of a
2sale of service may be shown as a distinct and separate item on
3the serviceman's billing to the service customer. If the
4selling price is not so shown, the selling price of the
5tangible personal property is deemed to be 50% of the
6serviceman's entire billing to the service customer. When,
7however, a serviceman contracts to design, develop, and
8produce special order machinery or equipment, the tax imposed
9by this Act shall be based on the serviceman's cost price of
10the tangible personal property transferred incident to the
11completion of the contract.
12    Beginning on July 1, 2000 and through December 31, 2000,
13with respect to motor fuel, as defined in Section 1.1 of the
14Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
15the Use Tax Act, the tax is imposed at the rate of 1.25%.
16    With respect to gasohol, as defined in the Use Tax Act, the
17tax imposed by this Act shall apply to (i) 70% of the cost
18price of property transferred as an incident to the sale of
19service on or after January 1, 1990, and before July 1, 2003,
20(ii) 80% of the selling price of property transferred as an
21incident to the sale of service on or after July 1, 2003 and on
22or before July 1, 2017, and (iii) 100% of the cost price
23thereafter. If, at any time, however, the tax under this Act on
24sales of gasohol, as defined in the Use Tax Act, is imposed at
25the rate of 1.25%, then the tax imposed by this Act applies to
26100% of the proceeds of sales of gasohol made during that time.

 

 

HB4381- 16 -LRB102 22272 HLH 31405 b

1    With respect to majority blended ethanol fuel, as defined
2in the Use Tax Act, the tax imposed by this Act does not apply
3to the selling price of property transferred as an incident to
4the sale of service on or after July 1, 2003 and on or before
5December 31, 2023 but applies to 100% of the selling price
6thereafter.
7    With respect to biodiesel blends, as defined in the Use
8Tax Act, with no less than 1% and no more than 10% biodiesel,
9the tax imposed by this Act applies to (i) 80% of the selling
10price of property transferred as an incident to the sale of
11service on or after July 1, 2003 and on or before December 31,
122018 and (ii) 100% of the proceeds of the selling price
13thereafter. If, at any time, however, the tax under this Act on
14sales of biodiesel blends, as defined in the Use Tax Act, with
15no less than 1% and no more than 10% biodiesel is imposed at
16the rate of 1.25%, then the tax imposed by this Act applies to
17100% of the proceeds of sales of biodiesel blends with no less
18than 1% and no more than 10% biodiesel made during that time.
19    With respect to 100% biodiesel, as defined in the Use Tax
20Act, and biodiesel blends, as defined in the Use Tax Act, with
21more than 10% but no more than 99% biodiesel material, the tax
22imposed by this Act does not apply to the proceeds of the
23selling price of property transferred as an incident to the
24sale of service on or after July 1, 2003 and on or before
25December 31, 2023 but applies to 100% of the selling price
26thereafter.

 

 

HB4381- 17 -LRB102 22272 HLH 31405 b

1    At the election of any registered serviceman made for each
2fiscal year, sales of service in which the aggregate annual
3cost price of tangible personal property transferred as an
4incident to the sales of service is less than 35%, or 75% in
5the case of servicemen transferring prescription drugs or
6servicemen engaged in graphic arts production, of the
7aggregate annual total gross receipts from all sales of
8service, the tax imposed by this Act shall be based on the
9serviceman's cost price of the tangible personal property
10transferred incident to the sale of those services.
11    The tax shall be imposed at the rate of 1% on food prepared
12for immediate consumption and transferred incident to a sale
13of service subject to this Act or the Service Occupation Tax
14Act by an entity licensed under the Hospital Licensing Act,
15the Nursing Home Care Act, the Assisted Living and Shared
16Housing Act, the ID/DD Community Care Act, the MC/DD Act, the
17Specialized Mental Health Rehabilitation Act of 2013, or the
18Child Care Act of 1969, or an entity that holds a permit issued
19pursuant to the Life Care Facilities Act. The tax shall also be
20imposed at the rate of 1% on the following items:
21        (1) food for human consumption that is to be consumed
22    off the premises where it is sold (other than alcoholic
23    beverages, food consisting of or infused with adult use
24    cannabis, soft drinks, and food that has been prepared for
25    immediate consumption and is not otherwise included in
26    this paragraph);

 

 

HB4381- 18 -LRB102 22272 HLH 31405 b

1        (2) prescription and nonprescription medicines, drugs,
2    and medical appliances;
3        (3) products classified as Class III medical devices
4    by the United States Food and Drug Administration that are
5    used for cancer treatment pursuant to a prescription, as
6    well as any accessories and components related to those
7    devices;
8        (4) modifications to a motor vehicle for the purpose
9    of rendering it usable by a person with a disability;
10        (5) insulin, blood sugar testing materials, syringes,
11    and needles used by human diabetics; and
12        (6) diapers and baby wipes.
13food for human consumption that is to be consumed off the
14premises where it is sold (other than alcoholic beverages,
15food consisting of or infused with adult use cannabis, soft
16drinks, and food that has been prepared for immediate
17consumption and is not otherwise included in this paragraph)
18and prescription and nonprescription medicines, drugs, medical
19appliances, products classified as Class III medical devices
20by the United States Food and Drug Administration that are
21used for cancer treatment pursuant to a prescription, as well
22as any accessories and components related to those devices,
23modifications to a motor vehicle for the purpose of rendering
24it usable by a person with a disability, and insulin, blood
25sugar testing materials, syringes, and needles used by human
26diabetics.

 

 

HB4381- 19 -LRB102 22272 HLH 31405 b

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

 

 

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

 

 

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1        (A) A "Drug Facts" panel; or
2        (B) A statement of the "active ingredient(s)" with a
3    list of those ingredients contained in the compound,
4    substance or preparation.
5    Beginning on January 1, 2014 (the effective date of Public
6Act 98-122), "prescription and nonprescription medicines and
7drugs" includes medical cannabis purchased from a registered
8dispensing organization under the Compassionate Use of Medical
9Cannabis Program Act.
10    As used in this Section, "adult use cannabis" means
11cannabis subject to tax under the Cannabis Cultivation
12Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
13and does not include cannabis subject to tax under the
14Compassionate Use of Medical Cannabis Program Act.
15(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
16102-4, eff. 4-27-21; 102-16, eff. 6-17-21.)
 
17    Section 20. The Retailers' Occupation Tax Act is amended
18by changing Section 2-10 as follows:
 
19    (35 ILCS 120/2-10)
20    Sec. 2-10. Rate of tax. Unless otherwise provided in this
21Section, the tax imposed by this Act is at the rate of 6.25% of
22gross receipts from sales of tangible personal property made
23in the course of business.
24    Beginning on July 1, 2000 and through December 31, 2000,

 

 

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1with respect to motor fuel, as defined in Section 1.1 of the
2Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
3the Use Tax Act, the tax is imposed at the rate of 1.25%.
4    Beginning on August 6, 2010 through August 15, 2010, with
5respect to sales tax holiday items as defined in Section 2-8 of
6this Act, the tax is imposed at the rate of 1.25%.
7    Within 14 days after the effective date of this amendatory
8Act of the 91st General Assembly, each retailer of motor fuel
9and gasohol shall cause the following notice to be posted in a
10prominently visible place on each retail dispensing device
11that is used to dispense motor fuel or gasohol in the State of
12Illinois: "As of July 1, 2000, the State of Illinois has
13eliminated the State's share of sales tax on motor fuel and
14gasohol through December 31, 2000. The price on this pump
15should reflect the elimination of the tax." The notice shall
16be printed in bold print on a sign that is no smaller than 4
17inches by 8 inches. The sign shall be clearly visible to
18customers. Any retailer who fails to post or maintain a
19required sign through December 31, 2000 is guilty of a petty
20offense for which the fine shall be $500 per day per each
21retail premises where a violation occurs.
22    With respect to gasohol, as defined in the Use Tax Act, the
23tax imposed by this Act applies to (i) 70% of the proceeds of
24sales made on or after January 1, 1990, and before July 1,
252003, (ii) 80% of the proceeds of sales made on or after July
261, 2003 and on or before July 1, 2017, and (iii) 100% of the

 

 

HB4381- 23 -LRB102 22272 HLH 31405 b

1proceeds of sales made thereafter. If, at any time, however,
2the tax under this Act on sales of gasohol, as defined in the
3Use Tax Act, is imposed at the rate of 1.25%, then the tax
4imposed by this Act applies to 100% of the proceeds of sales of
5gasohol made during that time.
6    With respect to majority blended ethanol fuel, as defined
7in the Use Tax Act, the tax imposed by this Act does not apply
8to the proceeds of sales made on or after July 1, 2003 and on
9or before December 31, 2023 but applies to 100% of the proceeds
10of sales made thereafter.
11    With respect to biodiesel blends, as defined in the Use
12Tax Act, with no less than 1% and no more than 10% biodiesel,
13the tax imposed by this Act applies to (i) 80% of the proceeds
14of sales made on or after July 1, 2003 and on or before
15December 31, 2018 and (ii) 100% of the proceeds of sales made
16thereafter. If, at any time, however, the tax under this Act on
17sales of biodiesel blends, as defined in the Use Tax Act, with
18no less than 1% and no more than 10% biodiesel is imposed at
19the rate of 1.25%, then the tax imposed by this Act applies to
20100% of the proceeds of sales of biodiesel blends with no less
21than 1% and no more than 10% biodiesel made during that time.
22    With respect to 100% biodiesel, as defined in the Use Tax
23Act, and biodiesel blends, as defined in the Use Tax Act, with
24more than 10% but no more than 99% biodiesel, the tax imposed
25by this Act does not apply to the proceeds of sales made on or
26after July 1, 2003 and on or before December 31, 2023 but

 

 

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1applies to 100% of the proceeds of sales made thereafter.
2    The tax is imposed at the rate of 1% on the following
3items:
4        (1) food for human consumption that is to be consumed
5    off the premises where it is sold (other than alcoholic
6    beverages, food consisting of or infused with adult use
7    cannabis, soft drinks, and food that has been prepared for
8    immediate consumption);
9        (2) prescription and nonprescription medicines, drugs,
10    and medical appliances;
11        (3) products classified as Class III medical devices
12    by the United States Food and Drug Administration that are
13    used for cancer treatment pursuant to a prescription, as
14    well as any accessories and components related to those
15    devices;
16        (4) modifications to a motor vehicle for the purpose
17    of rendering it usable by a person with a disability;
18        (5) insulin, blood sugar testing materials, syringes,
19    and needles used by human diabetics; and
20        (6) diapers and baby wipes.
21With respect to food for human consumption that is to be
22consumed off the premises where it is sold (other than
23alcoholic beverages, food consisting of or infused with adult
24use cannabis, soft drinks, and food that has been prepared for
25immediate consumption) and prescription and nonprescription
26medicines, drugs, medical appliances, products classified as

 

 

HB4381- 25 -LRB102 22272 HLH 31405 b

1Class III medical devices by the United States Food and Drug
2Administration that are used for cancer treatment pursuant to
3a prescription, as well as any accessories and components
4related to those devices, modifications to a motor vehicle for
5the purpose of rendering it usable by a person with a
6disability, and insulin, blood sugar testing materials,
7syringes, and needles used by human diabetics, the tax is
8imposed at the rate of 1%.
9    For the purposes of this Section, until September 1, 2009:
10the term "soft drinks" means any complete, finished,
11ready-to-use, non-alcoholic drink, whether carbonated or not,
12including but not limited to soda water, cola, fruit juice,
13vegetable juice, carbonated water, and all other preparations
14commonly known as soft drinks of whatever kind or description
15that are contained in any closed or sealed bottle, can,
16carton, or container, regardless of size; but "soft drinks"
17does not include coffee, tea, non-carbonated water, infant
18formula, milk or milk products as defined in the Grade A
19Pasteurized Milk and Milk Products Act, or drinks containing
2050% or more natural fruit or vegetable juice.
21    Notwithstanding any other provisions of this Act,
22beginning September 1, 2009, "soft drinks" means non-alcoholic
23beverages that contain natural or artificial sweeteners. "Soft
24drinks" do not include beverages that contain milk or milk
25products, soy, rice or similar milk substitutes, or greater
26than 50% of vegetable or fruit juice by volume.

 

 

HB4381- 26 -LRB102 22272 HLH 31405 b

1    Until August 1, 2009, and notwithstanding any other
2provisions of this Act, "food for human consumption that is to
3be consumed off the premises where it is sold" includes all
4food sold through a vending machine, except soft drinks and
5food products that are dispensed hot from a vending machine,
6regardless of the location of the vending machine. Beginning
7August 1, 2009, and notwithstanding any other provisions of
8this Act, "food for human consumption that is to be consumed
9off the premises where it is sold" includes all food sold
10through a vending machine, except soft drinks, candy, and food
11products that are dispensed hot from a vending machine,
12regardless of the location of the vending machine.
13    Notwithstanding any other provisions of this Act,
14beginning September 1, 2009, "food for human consumption that
15is to be consumed off the premises where it is sold" does not
16include candy. For purposes of this Section, "candy" means a
17preparation of sugar, honey, or other natural or artificial
18sweeteners in combination with chocolate, fruits, nuts or
19other ingredients or flavorings in the form of bars, drops, or
20pieces. "Candy" does not include any preparation that contains
21flour or requires refrigeration.
22    Notwithstanding any other provisions of this Act,
23beginning September 1, 2009, "nonprescription medicines and
24drugs" does not include grooming and hygiene products. For
25purposes of this Section, "grooming and hygiene products"
26includes, but is not limited to, soaps and cleaning solutions,

 

 

HB4381- 27 -LRB102 22272 HLH 31405 b

1shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
2lotions and screens, unless those products are available by
3prescription only, regardless of whether the products meet the
4definition of "over-the-counter-drugs". For the purposes of
5this paragraph, "over-the-counter-drug" means a drug for human
6use that contains a label that identifies the product as a drug
7as required by 21 C.F.R. § 201.66. The "over-the-counter-drug"
8label includes:
9        (A) A "Drug Facts" panel; or
10        (B) A statement of the "active ingredient(s)" with a
11    list of those ingredients contained in the compound,
12    substance or preparation.
13    Beginning on the effective date of this amendatory Act of
14the 98th General Assembly, "prescription and nonprescription
15medicines and drugs" includes medical cannabis purchased from
16a registered dispensing organization under the Compassionate
17Use of Medical Cannabis Program Act.
18    As used in this Section, "adult use cannabis" means
19cannabis subject to tax under the Cannabis Cultivation
20Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
21and does not include cannabis subject to tax under the
22Compassionate Use of Medical Cannabis Program Act.
23(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
24102-4, eff. 4-27-21.)