Illinois General Assembly - Full Text of HB0818
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Full Text of HB0818  100th General Assembly

HB0818 100TH GENERAL ASSEMBLY

  
  

 


 
100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
HB0818

 

Introduced , by Rep. Michael J. Zalewski

 

SYNOPSIS AS INTRODUCED:
 
20 ILCS 605/605-1020 new
35 ILCS 105/3-5
35 ILCS 110/3-5
35 ILCS 115/3-5
35 ILCS 120/2-5
35 ILCS 640/2-4

    Amends the Department of Commerce and Economic Opportunity Law of the Civil Administrative Code of Illinois, the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act, and the Electricity Excise Tax Law. Provides that the Department of Commerce and Economic Opportunity shall issue certificates of exemption to qualified Illinois data centers. Provides that qualified tangible personal property used in the construction or operation of a certified data center is exempt from the taxes imposed under the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, the Retailers' Occupation Tax Act. Provides that certified data centers are exempt from the tax imposed under the Electricity Excise Tax Law. Effective immediately.


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FISCAL NOTE ACT MAY APPLY

 

 

A BILL FOR

 

HB0818LRB100 06016 HLH 16046 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 Department of Commerce and Economic
5Opportunity Law of the Civil Administrative Code of Illinois is
6amended by adding Section 605-1020 as follows:
 
7    (20 ILCS 605/605-1020 new)
8    Sec. 605-1020. Data Center Investment Program.
9    (a) The Department shall issue certificates of exemption
10from the Retailers' Occupation Tax Act, the Use Tax Act, the
11Service Use Tax Act, the Service Occupation Tax Act, and the
12Electricity Excise Tax Law to qualifying Illinois data centers.
13    (b) Data centers seeking qualification for a new or
14expanding facility shall apply to the Department in the manner
15specified by the Department. The Department and any qualifying
16person seeking to claim the exemption, including a data center
17operator on behalf of itself and its tenants, must enter into a
18memorandum of understanding that, at a minimum, provides the
19details for determining the amount of capital investment made
20and the number of new jobs created, the timeline for achieving
21the capital investment and new job goals, the repayment
22obligation should those goals not be achieved, and any
23conditions under which repayment by the qualifying data center

 

 

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1or data center tenant claiming the exemption may be required.
2    (c) In addition, the exemption shall apply to any computer
3equipment or enabling equipment and any software purchased or
4leased to upgrade, supplement, or replace computer equipment or
5enabling software purchased or leased in the initial
6investment. Data centers that would have qualified under
7subsection (e) prior to July 1, 2017 may apply for and obtain
8an exemption for subsequent purchases of computer equipment or
9enabling software purchased or leased to upgrade, supplement,
10or replace computer equipment or enabling software purchased or
11leased in the original investment that would have qualified
12under subsection (e).
13    (d) Beginning July 15, 2018, and each year thereafter, the
14Department shall annually compile a report on the outcomes and
15effectiveness of the program under this Section.
16    (e) As used in this Section:
17    "Data center" means a building or a series of buildings
18rehabilitated or constructed to house a group of networked
19server computers in one physical location or several sites in
20order to centralize the storage, management, and dissemination
21of data and information.
22    "Qualifying Illinois data center" means a data center that:
23        (1) is located in Illinois;
24        (2) results in a new capital investment on or after
25    July 1, 2017 of at least $25,000,000, collectively, by the
26    data center operator and the tenants of the data center

 

 

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1    over a period of 48 months, and
2        (3) results in the creation on or after July 1, 2017
3    and over a period of 48 months of at last 10 full-time or
4    full-time equivalent new jobs by the data center operator
5    and the tenants of the data center, collectively,
6    associated with the operation or maintenance of the data
7    center.
8    "Full-time equivalent job" means a job in which the new
9employee works for the owner, operator, or tenant of a data
10center, or for a corporation under contract with the owner,
11operator or tenant of a data center, at a rate of at least 35
12hours per week. An owner, operator, or tenant who employs labor
13or services at a specific site or facility under contract with
14another may declare one full-time, permanent job for every
151,820 man hours worked per year under that contract. Vacations,
16paid holidays, and sick time are included in this computation.
17Overtime is not considered a part of regular hours.
 
18    Section 10. The Use Tax Act is amended by changing Section
193-5 as follows:
 
20    (35 ILCS 105/3-5)
21    Sec. 3-5. Exemptions. Use of the following tangible
22personal property is exempt from the tax imposed by this Act:
23    (1) Personal property purchased from a corporation,
24society, association, foundation, institution, or

 

 

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

 

 

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1religious, or educational purposes, or by a not-for-profit
2corporation, society, association, foundation, institution, or
3organization that has no compensated officers or employees and
4that is organized and operated primarily for the recreation of
5persons 55 years of age or older. A limited liability company
6may qualify for the exemption under this paragraph only if the
7limited liability company is organized and operated
8exclusively for educational purposes. On and after July 1,
91987, however, no entity otherwise eligible for this exemption
10shall make tax-free purchases unless it has an active exemption
11identification number issued by the Department.
12    (5) Until July 1, 2003, a passenger car that is a
13replacement vehicle to the extent that the purchase price of
14the car is subject to the Replacement Vehicle Tax.
15    (6) 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,
19certified by the purchaser to be used primarily for graphic
20arts production, and including machinery and equipment
21purchased for lease. Equipment includes chemicals or chemicals
22acting as catalysts but only if the chemicals or chemicals
23acting as catalysts effect a direct and immediate change upon a
24graphic arts product.
25    (7) Farm chemicals.
26    (8) Legal tender, currency, medallions, or gold or silver

 

 

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1coinage issued by the State of Illinois, the government of the
2United States of America, or the government of any foreign
3country, and bullion.
4    (9) Personal property purchased from a teacher-sponsored
5student organization affiliated with an elementary or
6secondary school located in Illinois.
7    (10) A motor vehicle that is used for automobile renting,
8as defined in the Automobile Renting Occupation and Use Tax
9Act.
10    (11) Farm machinery and equipment, both new and used,
11including that manufactured on special order, certified by the
12purchaser to be used primarily for production agriculture or
13State or federal agricultural programs, including individual
14replacement parts for the machinery and equipment, including
15machinery and equipment purchased for lease, and including
16implements of husbandry defined in Section 1-130 of the
17Illinois Vehicle Code, farm machinery and agricultural
18chemical and fertilizer spreaders, and nurse wagons required to
19be registered under Section 3-809 of the Illinois Vehicle Code,
20but excluding other motor vehicles required to be registered
21under the Illinois Vehicle Code. Horticultural polyhouses or
22hoop houses used for propagating, growing, or overwintering
23plants shall be considered farm machinery and equipment under
24this item (11). Agricultural chemical tender tanks and dry
25boxes shall include units sold separately from a motor vehicle
26required to be licensed and units sold mounted on a motor

 

 

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1vehicle required to be licensed if the selling price of the
2tender is separately stated.
3    Farm machinery and equipment shall include precision
4farming equipment that is installed or purchased to be
5installed on farm machinery and equipment including, but not
6limited to, tractors, harvesters, sprayers, planters, seeders,
7or spreaders. Precision farming equipment includes, but is not
8limited to, soil testing sensors, computers, monitors,
9software, global positioning and mapping systems, and other
10such equipment.
11    Farm machinery and equipment also includes computers,
12sensors, software, and related equipment used primarily in the
13computer-assisted operation of production agriculture
14facilities, equipment, and activities such as, but not limited
15to, the collection, monitoring, and correlation of animal and
16crop data for the purpose of formulating animal diets and
17agricultural chemicals. This item (11) is exempt from the
18provisions of Section 3-90.
19    (12) Until June 30, 2013, fuel and petroleum products sold
20to or used by an air common carrier, certified by the carrier
21to be used for consumption, shipment, or storage in the conduct
22of its business as an air common carrier, for a flight destined
23for or returning from a location or locations outside the
24United States without regard to previous or subsequent domestic
25stopovers.
26    Beginning July 1, 2013, fuel and petroleum products sold to

 

 

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

 

 

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1    (15) Photoprocessing machinery and equipment, including
2repair and replacement parts, both new and used, including that
3manufactured on special order, certified by the purchaser to be
4used primarily for photoprocessing, and including
5photoprocessing machinery and equipment purchased for lease.
6    (16) Coal and aggregate exploration, mining, off-highway
7hauling, processing, maintenance, and reclamation equipment,
8including replacement parts and equipment, and including
9equipment purchased for lease, but excluding motor vehicles
10required to be registered under the Illinois Vehicle Code. The
11changes made to this Section by Public Act 97-767 apply on and
12after July 1, 2003, but no claim for credit or refund is
13allowed on or after August 16, 2013 (the effective date of
14Public Act 98-456) for such taxes paid during the period
15beginning July 1, 2003 and ending on August 16, 2013 (the
16effective date of Public Act 98-456).
17    (17) 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    (18) Manufacturing and assembling machinery and equipment
24used primarily in the process of manufacturing or assembling
25tangible personal property for wholesale or retail sale or
26lease, whether that sale or lease is made directly by the

 

 

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1manufacturer or by some other person, whether the materials
2used in the process are owned by the manufacturer or some other
3person, or whether that sale or lease is made apart from or as
4an incident to the seller's engaging in the service occupation
5of producing machines, tools, dies, jigs, patterns, gauges, or
6other similar items of no commercial value on special order for
7a particular purchaser. The exemption provided by this
8paragraph (18) does not include machinery and equipment used in
9(i) the generation of electricity for wholesale or retail sale;
10(ii) the generation or treatment of natural or artificial gas
11for wholesale or retail sale that is delivered to customers
12through pipes, pipelines, or mains; or (iii) the treatment of
13water for wholesale or retail sale that is delivered to
14customers through pipes, pipelines, or mains. The provisions of
15Public Act 98-583 are declaratory of existing law as to the
16meaning and scope of this exemption.
17    (19) Personal property delivered to a purchaser or
18purchaser's donee inside Illinois when the purchase order for
19that personal property was received by a florist located
20outside Illinois who has a florist located inside Illinois
21deliver the personal property.
22    (20) Semen used for artificial insemination of livestock
23for direct agricultural production.
24    (21) Horses, or interests in horses, registered with and
25meeting the requirements of any of the Arabian Horse Club
26Registry of America, Appaloosa Horse Club, American Quarter

 

 

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1Horse Association, United States Trotting Association, or
2Jockey Club, as appropriate, used for purposes of breeding or
3racing for prizes. This item (21) is exempt from the provisions
4of Section 3-90, and the exemption provided for under this item
5(21) applies for all periods beginning May 30, 1995, but no
6claim for credit or refund is allowed on or after January 1,
72008 for such taxes paid during the period beginning May 30,
82000 and ending on January 1, 2008.
9    (22) Computers and communications equipment utilized for
10any hospital purpose and equipment used in the diagnosis,
11analysis, or treatment of hospital patients purchased by a
12lessor who leases the equipment, under a lease of one year or
13longer executed or in effect at the time the lessor would
14otherwise be subject to the tax imposed by this Act, to a
15hospital that has been issued an active tax exemption
16identification number by the Department under Section 1g of the
17Retailers' Occupation Tax Act. If the equipment is leased in a
18manner that does not qualify for this exemption or is used in
19any other non-exempt manner, the lessor shall be liable for the
20tax imposed under this Act or the Service Use Tax Act, as the
21case may be, based on the fair market value of the property at
22the time the non-qualifying use occurs. No lessor shall collect
23or attempt to collect an amount (however designated) that
24purports to reimburse that lessor for the tax imposed by this
25Act or the Service Use Tax Act, as the case may be, if the tax
26has not been paid by the lessor. If a lessor improperly

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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1with a gross vehicle weight in excess of 8,000 pounds and that
2are subject to the commercial distribution fee imposed under
3Section 3-815.1 of the Illinois Vehicle Code. Beginning on July
41, 2004 and through June 30, 2005, the use in this State of
5motor vehicles of the second division: (i) with a gross vehicle
6weight rating in excess of 8,000 pounds; (ii) that are subject
7to the commercial distribution fee imposed under Section
83-815.1 of the Illinois Vehicle Code; and (iii) that are
9primarily used for commercial purposes. Through June 30, 2005,
10this exemption applies to repair and replacement parts added
11after the initial purchase of such a motor vehicle if that
12motor vehicle is used in a manner that would qualify for the
13rolling stock exemption otherwise provided for in this Act. For
14purposes of this paragraph, the term "used for commercial
15purposes" means the transportation of persons or property in
16furtherance of any commercial or industrial enterprise,
17whether for-hire or not.
18    (34) Beginning January 1, 2008, tangible personal property
19used in the construction or maintenance of a community water
20supply, as defined under Section 3.145 of the Environmental
21Protection Act, that is operated by a not-for-profit
22corporation that holds a valid water supply permit issued under
23Title IV of the Environmental Protection Act. This paragraph is
24exempt from the provisions of Section 3-90.
25    (35) Beginning January 1, 2010, materials, parts,
26equipment, components, and furnishings incorporated into or

 

 

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1upon an aircraft as part of the modification, refurbishment,
2completion, replacement, repair, or maintenance of the
3aircraft. This exemption includes consumable supplies used in
4the modification, refurbishment, completion, replacement,
5repair, and maintenance of aircraft, but excludes any
6materials, parts, equipment, components, and consumable
7supplies used in the modification, replacement, repair, and
8maintenance of aircraft engines or power plants, whether such
9engines or power plants are installed or uninstalled upon any
10such aircraft. "Consumable supplies" include, but are not
11limited to, adhesive, tape, sandpaper, general purpose
12lubricants, cleaning solution, latex gloves, and protective
13films. This exemption applies only to the use of qualifying
14tangible personal property by persons who modify, refurbish,
15complete, repair, replace, or maintain aircraft and who (i)
16hold an Air Agency Certificate and are empowered to operate an
17approved 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. The changes made to this
24paragraph (35) by Public Act 98-534 are declarative of existing
25law.
26    (36) Tangible personal property purchased by a

 

 

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1public-facilities corporation, as described in Section
211-65-10 of the Illinois Municipal Code, for purposes of
3constructing or furnishing a municipal convention hall, but
4only if the legal title to the municipal convention hall is
5transferred to the municipality without any further
6consideration by or on behalf of the municipality at the time
7of the completion of the municipal convention hall or upon the
8retirement or redemption of any bonds or other debt instruments
9issued by the public-facilities corporation in connection with
10the development of the municipal convention hall. This
11exemption includes existing public-facilities corporations as
12provided in Section 11-65-25 of the Illinois Municipal Code.
13This paragraph is exempt from the provisions of Section 3-90.
14    (37) Beginning January 1, 2017, menstrual pads, tampons,
15and menstrual cups.
16    (38) Beginning on July 1, 2017, qualified tangible personal
17property used in the construction or operation of a data center
18that has been granted a certificate of exemption by the
19Department of Commerce and Economic Opportunity under Section
20605-1020 of the Department of Commerce and Economic Opportunity
21Law of the Civil Administrative Code of Illinois, whether that
22tangible personal property is purchased by the owner of the
23data center or by a contractor, subcontractor, or tenant of the
24owner. This paragraph is exempt from the provisions of Section
253-90.
26(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;

 

 

HB0818- 21 -LRB100 06016 HLH 16046 b

198-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-574, eff.
21-1-14; 98-583, eff. 1-1-14; 98-756, eff. 7-16-14; 99-180, eff.
37-29-15; 99-855, eff. 8-19-16.)
 
4    Section 15. The Service Use Tax Act is amended by changing
5Section 3-5 as follows:
 
6    (35 ILCS 110/3-5)
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 non-profit Illinois
17county fair association for use in conducting, operating, or
18promoting 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
24support of arts or cultural programming, activities, or

 

 

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1services. These organizations include, but are not limited to,
2music and dramatic arts organizations such as symphony
3orchestras and theatrical groups, arts and cultural service
4organizations, local arts councils, visual arts organizations,
5and media arts organizations. On and after the effective date
6of this amendatory Act of the 92nd General Assembly, however,
7an entity otherwise eligible for this exemption shall not make
8tax-free purchases unless it has an active identification
9number issued by the Department.
10    (4) Legal tender, currency, medallions, or gold or silver
11coinage issued by the State of Illinois, the government of the
12United States of America, or the government of any foreign
13country, and bullion.
14    (5) Until July 1, 2003 and beginning again on September 1,
152004 through August 30, 2014, graphic arts machinery and
16equipment, including repair and replacement parts, both new and
17used, and including that manufactured on special order or
18purchased for lease, certified by the purchaser to be used
19primarily for graphic arts production. Equipment includes
20chemicals or chemicals acting as catalysts but only if the
21chemicals or chemicals acting as catalysts effect a direct and
22immediate change upon a graphic arts product.
23    (6) Personal property purchased from a teacher-sponsored
24student organization affiliated with an elementary or
25secondary school located in Illinois.
26    (7) Farm machinery and equipment, both new and used,

 

 

HB0818- 23 -LRB100 06016 HLH 16046 b

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

 

 

HB0818- 24 -LRB100 06016 HLH 16046 b

1    Farm machinery and equipment also includes computers,
2sensors, software, and related equipment used primarily in the
3computer-assisted operation of production agriculture
4facilities, equipment, and activities such as, but not limited
5to, the collection, monitoring, and correlation of animal and
6crop data for the purpose of formulating animal diets and
7agricultural chemicals. This item (7) is exempt from the
8provisions of Section 3-75.
9    (8) Until June 30, 2013, fuel and petroleum products sold
10to or used by an air common carrier, certified by the carrier
11to be used for consumption, shipment, or storage in the conduct
12of its business as an air common carrier, for a flight destined
13for or returning from a location or locations outside the
14United States without regard to previous or subsequent domestic
15stopovers.
16    Beginning July 1, 2013, fuel and petroleum products sold to
17or used by an air carrier, certified by the carrier to be used
18for consumption, shipment, or storage in the conduct of its
19business as an air common carrier, for a flight that (i) is
20engaged in foreign trade or is engaged in trade between the
21United States and any of its possessions and (ii) transports at
22least one individual or package for hire from the city of
23origination to the city of final destination on the same
24aircraft, without regard to a change in the flight number of
25that aircraft.
26    (9) Proceeds of mandatory service charges separately

 

 

HB0818- 25 -LRB100 06016 HLH 16046 b

1stated on customers' bills for the purchase and consumption of
2food and beverages acquired as an incident to the purchase of a
3service from a serviceman, to the extent that the proceeds of
4the service charge are in fact turned over as tips or as a
5substitute for tips to the employees who participate directly
6in preparing, serving, hosting or cleaning up the food or
7beverage function with respect to which the service charge is
8imposed.
9    (10) Until July 1, 2003, oil field exploration, drilling,
10and production equipment, including (i) rigs and parts of rigs,
11rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
12tubular goods, including casing and drill strings, (iii) pumps
13and pump-jack units, (iv) storage tanks and flow lines, (v) any
14individual replacement part for oil field exploration,
15drilling, and production equipment, and (vi) machinery and
16equipment purchased for lease; but excluding motor vehicles
17required to be registered under the Illinois Vehicle Code.
18    (11) Proceeds from the sale of photoprocessing machinery
19and equipment, including repair and replacement parts, both new
20and used, including that manufactured on special order,
21certified by the purchaser to be used primarily for
22photoprocessing, and including photoprocessing machinery and
23equipment purchased for lease.
24    (12) Coal and aggregate exploration, mining, off-highway
25hauling, processing, maintenance, and reclamation equipment,
26including replacement parts and equipment, and including

 

 

HB0818- 26 -LRB100 06016 HLH 16046 b

1equipment purchased for lease, but excluding motor vehicles
2required to be registered under the Illinois Vehicle Code. The
3changes made to this Section by Public Act 97-767 apply on and
4after July 1, 2003, but no claim for credit or refund is
5allowed on or after August 16, 2013 (the effective date of
6Public Act 98-456) for such taxes paid during the period
7beginning July 1, 2003 and ending on August 16, 2013 (the
8effective date of Public Act 98-456).
9    (13) Semen used for artificial insemination of livestock
10for direct agricultural production.
11    (14) Horses, or interests in horses, registered with and
12meeting the requirements of any of the Arabian Horse Club
13Registry of America, Appaloosa Horse Club, American Quarter
14Horse Association, United States Trotting Association, or
15Jockey Club, as appropriate, used for purposes of breeding or
16racing for prizes. This item (14) is exempt from the provisions
17of Section 3-75, and the exemption provided for under this item
18(14) applies for all periods beginning May 30, 1995, but no
19claim for credit or refund is allowed on or after the effective
20date of this amendatory Act of the 95th General Assembly for
21such taxes paid during the period beginning May 30, 2000 and
22ending on the effective date of this amendatory Act of the 95th
23General Assembly.
24    (15) Computers and communications equipment utilized for
25any hospital purpose and equipment used in the diagnosis,
26analysis, or treatment of hospital patients purchased by a

 

 

HB0818- 27 -LRB100 06016 HLH 16046 b

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

 

 

HB0818- 28 -LRB100 06016 HLH 16046 b

1qualify for this exemption or is used in any other non-exempt
2manner, the lessor shall be liable for the tax imposed under
3this Act or the Use Tax Act, as the case may be, based on the
4fair market value of the property at the time the
5non-qualifying use occurs. No lessor shall collect or attempt
6to collect an amount (however designated) that purports to
7reimburse that lessor for the tax imposed by this Act or the
8Use Tax Act, as the case may be, if the tax has not been paid by
9the lessor. If a lessor improperly collects any such amount
10from the lessee, the lessee shall have a legal right to claim a
11refund of that amount from the lessor. If, however, that amount
12is not refunded to the lessee for any reason, the lessor is
13liable to pay that amount to the Department.
14    (17) Beginning with taxable years ending on or after
15December 31, 1995 and ending with taxable years ending on or
16before December 31, 2004, personal property that is donated for
17disaster relief to be used in a State or federally declared
18disaster area in Illinois or bordering Illinois by a
19manufacturer or retailer that is registered in this State to a
20corporation, society, association, foundation, or institution
21that has been issued a sales tax exemption identification
22number by the Department that assists victims of the disaster
23who reside within the declared disaster area.
24    (18) Beginning with taxable years ending on or after
25December 31, 1995 and ending with taxable years ending on or
26before December 31, 2004, personal property that is used in the

 

 

HB0818- 29 -LRB100 06016 HLH 16046 b

1performance of infrastructure repairs in this State, including
2but not limited to municipal roads and streets, access roads,
3bridges, sidewalks, waste disposal systems, water and sewer
4line extensions, water distribution and purification
5facilities, storm water drainage and retention facilities, and
6sewage treatment facilities, resulting from a State or
7federally declared disaster in Illinois or bordering Illinois
8when such repairs are initiated on facilities located in the
9declared disaster area within 6 months after the disaster.
10    (19) Beginning July 1, 1999, game or game birds purchased
11at a "game breeding and hunting preserve area" as that term is
12used in the Wildlife Code. This paragraph is exempt from the
13provisions of Section 3-75.
14    (20) A motor vehicle, as that term is defined in Section
151-146 of the Illinois Vehicle Code, that is donated to a
16corporation, limited liability company, society, association,
17foundation, or institution that is determined by the Department
18to be organized and operated exclusively for educational
19purposes. For purposes of this exemption, "a corporation,
20limited liability company, society, association, foundation,
21or institution organized and operated exclusively for
22educational purposes" means all tax-supported public schools,
23private schools that offer systematic instruction in useful
24branches of learning by methods common to public schools and
25that compare favorably in their scope and intensity with the
26course of study presented in tax-supported schools, and

 

 

HB0818- 30 -LRB100 06016 HLH 16046 b

1vocational or technical schools or institutes organized and
2operated exclusively to provide a course of study of not less
3than 6 weeks duration and designed to prepare individuals to
4follow a trade or to pursue a manual, technical, mechanical,
5industrial, business, or commercial occupation.
6    (21) Beginning January 1, 2000, personal property,
7including food, purchased through fundraising events for the
8benefit of a public or private elementary or secondary school,
9a group of those schools, or one or more school districts if
10the events are sponsored by an entity recognized by the school
11district that consists primarily of volunteers and includes
12parents and teachers of the school children. This paragraph
13does not apply to fundraising events (i) for the benefit of
14private home instruction or (ii) for which the fundraising
15entity purchases the personal property sold at the events from
16another individual or entity that sold the property for the
17purpose of resale by the fundraising entity and that profits
18from the sale to the fundraising entity. This paragraph is
19exempt from the provisions of Section 3-75.
20    (22) Beginning January 1, 2000 and through December 31,
212001, new or used automatic vending machines that prepare and
22serve hot food and beverages, including coffee, soup, and other
23items, and replacement parts for these machines. Beginning
24January 1, 2002 and through June 30, 2003, machines and parts
25for machines used in commercial, coin-operated amusement and
26vending business if a use or occupation tax is paid on the

 

 

HB0818- 31 -LRB100 06016 HLH 16046 b

1gross receipts derived from the use of the commercial,
2coin-operated amusement and vending machines. This paragraph
3is exempt from the provisions of Section 3-75.
4    (23) Beginning August 23, 2001 and through June 30, 2016,
5food for human consumption that is to be consumed off the
6premises where it is sold (other than alcoholic beverages, soft
7drinks, and food that has been prepared for immediate
8consumption) and prescription and nonprescription medicines,
9drugs, medical appliances, and insulin, urine testing
10materials, syringes, and needles used by diabetics, for human
11use, when purchased for use by a person receiving medical
12assistance under Article V of the Illinois Public Aid Code who
13resides in a licensed long-term care facility, as defined in
14the Nursing Home Care Act, or in a licensed facility as defined
15in the ID/DD Community Care Act, the MC/DD Act, or the
16Specialized Mental Health Rehabilitation Act of 2013.
17    (24) Beginning on the effective date of this amendatory Act
18of the 92nd General Assembly, computers and communications
19equipment utilized for any hospital purpose and equipment used
20in the diagnosis, analysis, or treatment of hospital patients
21purchased by a lessor who leases the equipment, under a lease
22of one year or longer executed or in effect at the time the
23lessor would otherwise be subject to the tax imposed by this
24Act, to a hospital that has been issued an active tax exemption
25identification number by the Department under Section 1g of the
26Retailers' Occupation Tax Act. If the equipment is leased in a

 

 

HB0818- 32 -LRB100 06016 HLH 16046 b

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

 

 

HB0818- 33 -LRB100 06016 HLH 16046 b

1the nonqualifying use occurs. No lessor shall collect or
2attempt to collect an amount (however designated) that purports
3to reimburse that lessor for the tax imposed by this Act or the
4Use Tax Act, as the case may be, if the tax has not been paid by
5the lessor. If a lessor improperly collects any such amount
6from the lessee, the lessee shall have a legal right to claim a
7refund of that amount from the lessor. If, however, that amount
8is not refunded to the lessee for any reason, the lessor is
9liable to pay that amount to the Department. This paragraph is
10exempt from the provisions of Section 3-75.
11    (26) Beginning January 1, 2008, tangible personal property
12used in the construction or maintenance of a community water
13supply, as defined under Section 3.145 of the Environmental
14Protection Act, that is operated by a not-for-profit
15corporation that holds a valid water supply permit issued under
16Title IV of the Environmental Protection Act. This paragraph is
17exempt from the provisions of Section 3-75.
18    (27) Beginning January 1, 2010, materials, parts,
19equipment, components, and furnishings incorporated into or
20upon an aircraft as part of the modification, refurbishment,
21completion, replacement, repair, or maintenance of the
22aircraft. This exemption includes consumable supplies used in
23the modification, refurbishment, completion, replacement,
24repair, and maintenance of aircraft, but excludes any
25materials, parts, equipment, components, and consumable
26supplies used in the modification, replacement, repair, and

 

 

HB0818- 34 -LRB100 06016 HLH 16046 b

1maintenance of aircraft engines or power plants, whether such
2engines or power plants are installed or uninstalled upon any
3such aircraft. "Consumable supplies" include, but are not
4limited to, adhesive, tape, sandpaper, general purpose
5lubricants, cleaning solution, latex gloves, and protective
6films. This exemption applies only to the use of qualifying
7tangible personal property transferred incident to the
8modification, refurbishment, completion, replacement, repair,
9or maintenance of aircraft by persons who (i) hold an Air
10Agency Certificate and are empowered to operate an approved
11repair station by the Federal Aviation Administration, (ii)
12have a Class IV Rating, and (iii) conduct operations in
13accordance with Part 145 of the Federal Aviation Regulations.
14The exemption does not include aircraft operated by a
15commercial air carrier providing scheduled passenger air
16service pursuant to authority issued under Part 121 or Part 129
17of the Federal Aviation Regulations. The changes made to this
18paragraph (27) by Public Act 98-534 are declarative of existing
19law.
20    (28) 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

 

 

HB0818- 35 -LRB100 06016 HLH 16046 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 3-75.
8    (29) Beginning January 1, 2017, menstrual pads, tampons,
9and menstrual cups.
10    (30) Beginning on July 1, 2017, qualified tangible personal
11property used in the construction or operation of a data center
12that has been granted a certificate of exemption by the
13Department of Commerce and Economic Opportunity under Section
14605-1020 of the Department of Commerce and Economic Opportunity
15Law of the Civil Administrative Code of Illinois, whether that
16tangible personal property is purchased by the owner of the
17data center or by a contractor, subcontractor, or tenant of the
18owner. This paragraph is exempt from the provisions of Section
193-75.
20(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
2198-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-756, eff.
227-16-14; 99-180, eff. 7-29-15; 99-855, eff. 8-19-16.)
 
23    Section 20. The Service Occupation Tax Act is amended by
24changing Section 3-5 as follows:
 

 

 

HB0818- 36 -LRB100 06016 HLH 16046 b

1    (35 ILCS 115/3-5)
2    Sec. 3-5. Exemptions. The following tangible personal
3property is exempt from the tax imposed by this Act:
4    (1) Personal property sold by a corporation, society,
5association, foundation, institution, or organization, other
6than a limited liability company, that is organized and
7operated as a not-for-profit service enterprise for the benefit
8of persons 65 years of age or older if the personal property
9was not purchased by the enterprise for the purpose of resale
10by the enterprise.
11    (2) Personal property purchased by a not-for-profit
12Illinois county fair association for use in conducting,
13operating, or promoting the county fair.
14    (3) Personal property purchased by any not-for-profit arts
15or cultural organization that establishes, by proof required by
16the Department by rule, that it has received an exemption under
17Section 501(c)(3) of the Internal Revenue Code and that is
18organized and operated primarily for the presentation or
19support of arts or cultural programming, activities, or
20services. These organizations include, but are not limited to,
21music and dramatic arts organizations such as symphony
22orchestras and theatrical groups, arts and cultural service
23organizations, local arts councils, visual arts organizations,
24and media arts organizations. On and after the effective date
25of this amendatory Act of the 92nd General Assembly, however,
26an entity otherwise eligible for this exemption shall not make

 

 

HB0818- 37 -LRB100 06016 HLH 16046 b

1tax-free purchases unless it has an active identification
2number issued by the Department.
3    (4) Legal tender, currency, medallions, or gold or silver
4coinage issued by the State of Illinois, the government of the
5United States of America, or the government of any foreign
6country, and bullion.
7    (5) Until July 1, 2003 and beginning again on September 1,
82004 through August 30, 2014, graphic arts machinery and
9equipment, including repair and replacement parts, both new and
10used, and including that manufactured on special order or
11purchased for lease, certified by the purchaser to be used
12primarily for graphic arts production. Equipment includes
13chemicals or chemicals acting as catalysts but only if the
14chemicals or chemicals acting as catalysts effect a direct and
15immediate change upon a graphic arts product.
16    (6) Personal property sold by a teacher-sponsored student
17organization affiliated with an elementary or secondary school
18located in Illinois.
19    (7) Farm machinery and equipment, both new and used,
20including that manufactured on special order, certified by the
21purchaser to be used primarily for production agriculture or
22State or federal agricultural programs, including individual
23replacement parts for the machinery and equipment, including
24machinery and equipment purchased for lease, and including
25implements of husbandry defined in Section 1-130 of the
26Illinois Vehicle Code, farm machinery and agricultural

 

 

HB0818- 38 -LRB100 06016 HLH 16046 b

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

 

 

HB0818- 39 -LRB100 06016 HLH 16046 b

1provisions of Section 3-55.
2    (8) Until June 30, 2013, fuel and petroleum products sold
3to or used by an air common carrier, certified by the carrier
4to be used for consumption, shipment, or storage in the conduct
5of its business as an air common carrier, for a flight destined
6for or returning from a location or locations outside the
7United States without regard to previous or subsequent domestic
8stopovers.
9    Beginning July 1, 2013, fuel and petroleum products sold to
10or used by an air carrier, certified by the carrier to be used
11for consumption, shipment, or storage in the conduct of its
12business as an air common carrier, for a flight that (i) is
13engaged in foreign trade or is engaged in trade between the
14United States and any of its possessions and (ii) transports at
15least one individual or package for hire from the city of
16origination to the city of final destination on the same
17aircraft, without regard to a change in the flight number of
18that aircraft.
19    (9) Proceeds of mandatory service charges separately
20stated on customers' bills for the purchase and consumption of
21food and beverages, to the extent that the proceeds of the
22service charge are in fact turned over as tips or as a
23substitute for tips to the employees who participate directly
24in preparing, serving, hosting or cleaning up the food or
25beverage function with respect to which the service charge is
26imposed.

 

 

HB0818- 40 -LRB100 06016 HLH 16046 b

1    (10) 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    (11) 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    (12) Coal and aggregate exploration, mining, off-highway
16hauling, processing, maintenance, and reclamation equipment,
17including replacement parts and equipment, and including
18equipment purchased for lease, but excluding motor vehicles
19required to be registered under the Illinois Vehicle Code. The
20changes made to this Section by Public Act 97-767 apply on and
21after July 1, 2003, but no claim for credit or refund is
22allowed on or after August 16, 2013 (the effective date of
23Public Act 98-456) for such taxes paid during the period
24beginning July 1, 2003 and ending on August 16, 2013 (the
25effective date of Public Act 98-456).
26    (13) Beginning January 1, 1992 and through June 30, 2016,

 

 

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1food for human consumption that is to be consumed off the
2premises where it is sold (other than alcoholic beverages, soft
3drinks and food that has been prepared for immediate
4consumption) and prescription and non-prescription medicines,
5drugs, medical appliances, and insulin, urine testing
6materials, syringes, and needles used by diabetics, for human
7use, when purchased for use by a person receiving medical
8assistance under Article V of the Illinois Public Aid Code who
9resides in a licensed long-term care facility, as defined in
10the Nursing Home Care Act, or in a licensed facility as defined
11in the ID/DD Community Care Act, the MC/DD Act, or the
12Specialized Mental Health Rehabilitation Act of 2013.
13    (14) Semen used for artificial insemination of livestock
14for direct agricultural production.
15    (15) Horses, or interests in horses, registered with and
16meeting the requirements of any of the Arabian Horse Club
17Registry of America, Appaloosa Horse Club, American Quarter
18Horse Association, United States Trotting Association, or
19Jockey Club, as appropriate, used for purposes of breeding or
20racing for prizes. This item (15) is exempt from the provisions
21of Section 3-55, and the exemption provided for under this item
22(15) applies for all periods beginning May 30, 1995, but no
23claim for credit or refund is allowed on or after January 1,
242008 (the effective date of Public Act 95-88) for such taxes
25paid during the period beginning May 30, 2000 and ending on
26January 1, 2008 (the effective date of Public Act 95-88).

 

 

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1    (16) Computers and communications equipment utilized for
2any hospital purpose and equipment used in the diagnosis,
3analysis, or treatment of hospital patients sold to a lessor
4who leases the equipment, under a lease of one year or longer
5executed or in effect at the time of the purchase, to a
6hospital that has been issued an active tax exemption
7identification number by the Department under Section 1g of the
8Retailers' Occupation Tax Act.
9    (17) Personal property sold to a lessor who leases the
10property, under a lease of one year or longer executed or in
11effect at the time of the purchase, to a governmental body that
12has been issued an active tax exemption identification number
13by the Department under Section 1g of the Retailers' Occupation
14Tax Act.
15    (18) Beginning with taxable years ending on or after
16December 31, 1995 and ending with taxable years ending on or
17before December 31, 2004, personal property that is donated for
18disaster relief to be used in a State or federally declared
19disaster area in Illinois or bordering Illinois by a
20manufacturer or retailer that is registered in this State to a
21corporation, society, association, foundation, or institution
22that has been issued a sales tax exemption identification
23number by the Department that assists victims of the disaster
24who reside within the declared disaster area.
25    (19) Beginning with taxable years ending on or after
26December 31, 1995 and ending with taxable years ending on or

 

 

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1before December 31, 2004, personal property that is used in the
2performance of infrastructure repairs in this State, including
3but not limited to municipal roads and streets, access roads,
4bridges, sidewalks, waste disposal systems, water and sewer
5line extensions, water distribution and purification
6facilities, storm water drainage and retention facilities, and
7sewage treatment facilities, resulting from a State or
8federally declared disaster in Illinois or bordering Illinois
9when such repairs are initiated on facilities located in the
10declared disaster area within 6 months after the disaster.
11    (20) Beginning July 1, 1999, game or game birds sold at a
12"game breeding and hunting preserve area" as that term is used
13in the Wildlife Code. This paragraph is exempt from the
14provisions of Section 3-55.
15    (21) A motor vehicle, as that term is defined in Section
161-146 of the Illinois Vehicle Code, that is donated to a
17corporation, limited liability company, society, association,
18foundation, or institution that is determined by the Department
19to be organized and operated exclusively for educational
20purposes. For purposes of this exemption, "a corporation,
21limited liability company, society, association, foundation,
22or institution organized and operated exclusively for
23educational purposes" means all tax-supported public schools,
24private schools that offer systematic instruction in useful
25branches of learning by methods common to public schools and
26that compare favorably in their scope and intensity with the

 

 

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1course of study presented in tax-supported schools, and
2vocational or technical schools or institutes organized and
3operated exclusively to provide a course of study of not less
4than 6 weeks duration and designed to prepare individuals to
5follow a trade or to pursue a manual, technical, mechanical,
6industrial, business, or commercial occupation.
7    (22) Beginning January 1, 2000, personal property,
8including food, purchased through fundraising events for the
9benefit of a public or private elementary or secondary school,
10a group of those schools, or one or more school districts if
11the events are sponsored by an entity recognized by the school
12district that consists primarily of volunteers and includes
13parents and teachers of the school children. This paragraph
14does not apply to fundraising events (i) for the benefit of
15private home instruction or (ii) for which the fundraising
16entity purchases the personal property sold at the events from
17another individual or entity that sold the property for the
18purpose of resale by the fundraising entity and that profits
19from the sale to the fundraising entity. This paragraph is
20exempt from the provisions of Section 3-55.
21    (23) Beginning January 1, 2000 and through December 31,
222001, new or used automatic vending machines that prepare and
23serve hot food and beverages, including coffee, soup, and other
24items, and replacement parts for these machines. Beginning
25January 1, 2002 and through June 30, 2003, machines and parts
26for machines used in commercial, coin-operated amusement and

 

 

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1vending business if a use or occupation tax is paid on the
2gross receipts derived from the use of the commercial,
3coin-operated amusement and vending machines. This paragraph
4is exempt from the provisions of Section 3-55.
5    (24) Beginning on the effective date of this amendatory Act
6of the 92nd General Assembly, computers and communications
7equipment utilized for any hospital purpose and equipment used
8in the diagnosis, analysis, or treatment of hospital patients
9sold to a lessor who leases the equipment, under a lease of one
10year or longer executed or in effect at the time of the
11purchase, to a hospital that has been issued an active tax
12exemption identification number by the Department under
13Section 1g of the Retailers' Occupation Tax Act. This paragraph
14is exempt from the provisions of Section 3-55.
15    (25) Beginning on the effective date of this amendatory Act
16of the 92nd General Assembly, personal property sold to a
17lessor who leases the property, under a lease of one year or
18longer executed or in effect at the time of the purchase, to a
19governmental body that has been issued an active tax exemption
20identification number by the Department under Section 1g of the
21Retailers' Occupation Tax Act. This paragraph is exempt from
22the provisions of Section 3-55.
23    (26) Beginning on January 1, 2002 and through June 30,
242016, tangible personal property purchased from an Illinois
25retailer by a taxpayer engaged in centralized purchasing
26activities in Illinois who will, upon receipt of the property

 

 

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1in Illinois, temporarily store the property in Illinois (i) for
2the purpose of subsequently transporting it outside this State
3for use or consumption thereafter solely outside this State or
4(ii) for the purpose of being processed, fabricated, or
5manufactured into, attached to, or incorporated into other
6tangible personal property to be transported outside this State
7and thereafter used or consumed solely outside this State. The
8Director of Revenue shall, pursuant to rules adopted in
9accordance with the Illinois Administrative Procedure Act,
10issue a permit to any taxpayer in good standing with the
11Department who is eligible for the exemption under this
12paragraph (26). The permit issued under this paragraph (26)
13shall authorize the holder, to the extent and in the manner
14specified in the rules adopted under this Act, to purchase
15tangible personal property from a retailer exempt from the
16taxes imposed by this Act. Taxpayers shall maintain all
17necessary books and records to substantiate the use and
18consumption of all such tangible personal property outside of
19the State of Illinois.
20    (27) 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 3-55.

 

 

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1    (28) Tangible personal property sold to a
2public-facilities corporation, as described in Section
311-65-10 of the Illinois Municipal Code, for purposes of
4constructing or furnishing a municipal convention hall, but
5only if the legal title to the municipal convention hall is
6transferred to the municipality without any further
7consideration by or on behalf of the municipality at the time
8of the completion of the municipal convention hall or upon the
9retirement or redemption of any bonds or other debt instruments
10issued by the public-facilities corporation in connection with
11the development of the municipal convention hall. This
12exemption includes existing public-facilities corporations as
13provided in Section 11-65-25 of the Illinois Municipal Code.
14This paragraph is exempt from the provisions of Section 3-55.
15    (29) Beginning January 1, 2010, materials, parts,
16equipment, components, and furnishings incorporated into or
17upon an aircraft as part of the modification, refurbishment,
18completion, replacement, repair, or maintenance of the
19aircraft. This exemption includes consumable supplies used in
20the modification, refurbishment, completion, replacement,
21repair, and maintenance of aircraft, but excludes any
22materials, parts, equipment, components, and consumable
23supplies used in the modification, replacement, repair, and
24maintenance of aircraft engines or power plants, whether such
25engines or power plants are installed or uninstalled upon any
26such aircraft. "Consumable supplies" include, but are not

 

 

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1limited to, adhesive, tape, sandpaper, general purpose
2lubricants, cleaning solution, latex gloves, and protective
3films. This exemption applies only to the transfer of
4qualifying tangible personal property incident to the
5modification, refurbishment, completion, replacement, repair,
6or maintenance of an aircraft by persons who (i) hold an Air
7Agency Certificate and are empowered to operate an approved
8repair station by the Federal Aviation Administration, (ii)
9have a Class IV Rating, and (iii) conduct operations in
10accordance with Part 145 of the Federal Aviation Regulations.
11The exemption does not include aircraft operated by a
12commercial air carrier providing scheduled passenger air
13service pursuant to authority issued under Part 121 or Part 129
14of the Federal Aviation Regulations. The changes made to this
15paragraph (29) by Public Act 98-534 are declarative of existing
16law.
17    (30) Beginning January 1, 2017, menstrual pads, tampons,
18and menstrual cups.
19    (31) Beginning on July 1, 2017, qualified tangible personal
20property used in the construction or operation of a data center
21that has been granted a certificate of exemption by the
22Department of Commerce and Economic Opportunity under Section
23605-1020 of the Department of Commerce and Economic Opportunity
24Law of the Civil Administrative Code of Illinois, whether that
25tangible personal property is purchased by the owner of the
26data center or by a contractor, subcontractor, or tenant of the

 

 

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1owner. This paragraph is exempt from the provisions of Section
23-55.
3(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
498-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-756, eff.
57-16-14; 99-180, eff. 7-29-15; 99-855, eff. 8-19-16.)
 
6    Section 25. The Retailers' Occupation Tax Act is amended by
7changing Section 2-5 as follows:
 
8    (35 ILCS 120/2-5)
9    Sec. 2-5. Exemptions. Gross receipts from proceeds from the
10sale of the following tangible personal property are exempt
11from the tax imposed by this Act:
12    (1) Farm chemicals.
13    (2) Farm machinery and equipment, both new and used,
14including that manufactured on special order, certified by the
15purchaser to be used primarily for production agriculture or
16State or federal agricultural programs, including individual
17replacement parts for the machinery and equipment, including
18machinery and equipment purchased for lease, and including
19implements of husbandry defined in Section 1-130 of the
20Illinois Vehicle Code, farm machinery and agricultural
21chemical and fertilizer spreaders, and nurse wagons required to
22be registered under Section 3-809 of the Illinois Vehicle Code,
23but excluding other motor vehicles required to be registered
24under the Illinois Vehicle Code. Horticultural polyhouses or

 

 

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

 

 

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1production of ethyl alcohol that will be used for consumption
2as motor fuel or as a component of motor fuel for the personal
3use of the user, and not subject to sale or resale.
4    (4) Until July 1, 2003 and beginning again September 1,
52004 through August 30, 2014, graphic arts machinery and
6equipment, including repair and replacement parts, both new and
7used, and including that manufactured on special order or
8purchased for lease, certified by the purchaser to be used
9primarily for graphic arts production. Equipment includes
10chemicals or chemicals acting as catalysts but only if the
11chemicals or chemicals acting as catalysts effect a direct and
12immediate change upon a graphic arts product.
13    (5) A motor vehicle that is used for automobile renting, as
14defined in the Automobile Renting Occupation and Use Tax Act.
15This paragraph is exempt from the provisions of Section 2-70.
16    (6) Personal property sold by a teacher-sponsored student
17organization affiliated with an elementary or secondary school
18located in Illinois.
19    (7) Until July 1, 2003, proceeds of that portion of the
20selling price of a passenger car the sale of which is subject
21to the Replacement Vehicle Tax.
22    (8) Personal property sold to an Illinois county fair
23association for use in conducting, operating, or promoting the
24county fair.
25    (9) Personal property sold to a not-for-profit arts or
26cultural organization that establishes, by proof required by

 

 

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1the Department by rule, that it has received an exemption under
2Section 501(c)(3) of the Internal Revenue Code and that is
3organized and operated primarily for the presentation or
4support of arts or cultural programming, activities, or
5services. These organizations include, but are not limited to,
6music and dramatic arts organizations such as symphony
7orchestras and theatrical groups, arts and cultural service
8organizations, local arts councils, visual arts organizations,
9and media arts organizations. On and after the effective date
10of this amendatory Act of the 92nd General Assembly, however,
11an entity otherwise eligible for this exemption shall not make
12tax-free purchases unless it has an active identification
13number issued by the Department.
14    (10) Personal property sold by a corporation, society,
15association, foundation, institution, or organization, other
16than a limited liability company, that is organized and
17operated as a not-for-profit service enterprise for the benefit
18of persons 65 years of age or older if the personal property
19was not purchased by the enterprise for the purpose of resale
20by the enterprise.
21    (11) Personal property sold to a governmental body, to a
22corporation, society, association, foundation, or institution
23organized and operated exclusively for charitable, religious,
24or educational purposes, or to a not-for-profit corporation,
25society, association, foundation, institution, or organization
26that has no compensated officers or employees and that is

 

 

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1organized and operated primarily for the recreation of persons
255 years of age or older. A limited liability company may
3qualify for the exemption under this paragraph only if the
4limited liability company is organized and operated
5exclusively for educational purposes. On and after July 1,
61987, however, no entity otherwise eligible for this exemption
7shall make tax-free purchases unless it has an active
8identification number issued by the Department.
9    (12) Tangible personal property sold to interstate
10carriers for hire for use as rolling stock moving in interstate
11commerce or to lessors under leases of one year or longer
12executed or in effect at the time of purchase by interstate
13carriers for hire for use as rolling stock moving in interstate
14commerce and equipment operated by a telecommunications
15provider, licensed as a common carrier by the Federal
16Communications Commission, which is permanently installed in
17or affixed to aircraft moving in interstate commerce.
18    (12-5) On and after July 1, 2003 and through June 30, 2004,
19motor vehicles of the second division with a gross vehicle
20weight in excess of 8,000 pounds that are subject to the
21commercial distribution fee imposed under Section 3-815.1 of
22the Illinois Vehicle Code. Beginning on July 1, 2004 and
23through June 30, 2005, the use in this State of motor vehicles
24of the second division: (i) with a gross vehicle weight rating
25in excess of 8,000 pounds; (ii) that are subject to the
26commercial distribution fee imposed under Section 3-815.1 of

 

 

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

 

 

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1items of no commercial value on special order for a particular
2purchaser. The exemption provided by this paragraph (14) does
3not include machinery and equipment used in (i) the generation
4of electricity for wholesale or retail sale; (ii) the
5generation or treatment of natural or artificial gas for
6wholesale or retail sale that is delivered to customers through
7pipes, pipelines, or mains; or (iii) the treatment of water for
8wholesale or retail sale that is delivered to customers through
9pipes, pipelines, or mains. The provisions of Public Act 98-583
10are declaratory of existing law as to the meaning and scope of
11this exemption.
12    (15) Proceeds of mandatory service charges separately
13stated on customers' bills for purchase and consumption of food
14and beverages, to the extent that the proceeds of the service
15charge are in fact turned over as tips or as a substitute for
16tips to the employees who participate directly in preparing,
17serving, hosting or cleaning up the food or beverage function
18with respect to which the service charge is imposed.
19    (16) Petroleum products sold to a purchaser if the seller
20is prohibited by federal law from charging tax to the
21purchaser.
22    (17) Tangible personal property sold to a common carrier by
23rail or motor that receives the physical possession of the
24property in Illinois and that transports the property, or
25shares with another common carrier in the transportation of the
26property, out of Illinois on a standard uniform bill of lading

 

 

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1showing the seller of the property as the shipper or consignor
2of the property to a destination outside Illinois, for use
3outside Illinois.
4    (18) Legal tender, currency, medallions, or gold or silver
5coinage issued by the State of Illinois, the government of the
6United States of America, or the government of any foreign
7country, and bullion.
8    (19) Until July 1 2003, oil field exploration, drilling,
9and production equipment, including (i) rigs and parts of rigs,
10rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and
11tubular goods, including casing and drill strings, (iii) pumps
12and pump-jack units, (iv) storage tanks and flow lines, (v) any
13individual replacement part for oil field exploration,
14drilling, and production equipment, and (vi) machinery and
15equipment purchased for lease; but excluding motor vehicles
16required to be registered under the Illinois Vehicle Code.
17    (20) Photoprocessing machinery and equipment, including
18repair and replacement parts, both new and used, including that
19manufactured on special order, certified by the purchaser to be
20used primarily for photoprocessing, and including
21photoprocessing machinery and equipment purchased for lease.
22    (21) Coal and aggregate exploration, mining, off-highway
23hauling, processing, maintenance, and reclamation equipment,
24including replacement parts and equipment, and including
25equipment purchased for lease, but excluding motor vehicles
26required to be registered under the Illinois Vehicle Code. The

 

 

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1changes made to this Section by Public Act 97-767 apply on and
2after July 1, 2003, but no claim for credit or refund is
3allowed on or after August 16, 2013 (the effective date of
4Public Act 98-456) for such taxes paid during the period
5beginning July 1, 2003 and ending on August 16, 2013 (the
6effective date of Public Act 98-456).
7    (22) Until June 30, 2013, fuel and petroleum products sold
8to or used by an air carrier, certified by the carrier to be
9used for consumption, shipment, or storage in the conduct of
10its business as an air common carrier, for a flight destined
11for or returning from a location or locations outside the
12United States without regard to previous or subsequent domestic
13stopovers.
14    Beginning July 1, 2013, fuel and petroleum products sold to
15or used by an air carrier, certified by the carrier to be used
16for consumption, shipment, or storage in the conduct of its
17business as an air common carrier, for a flight that (i) is
18engaged in foreign trade or is engaged in trade between the
19United States and any of its possessions and (ii) transports at
20least one individual or package for hire from the city of
21origination to the city of final destination on the same
22aircraft, without regard to a change in the flight number of
23that aircraft.
24    (23) A transaction in which the purchase order is received
25by a florist who is located outside Illinois, but who has a
26florist located in Illinois deliver the property to the

 

 

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

 

 

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

 

 

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

 

 

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1    This paragraph (25-7) is exempt from the provisions of
2Section 2-70.
3    (26) Semen used for artificial insemination of livestock
4for direct agricultural production.
5    (27) Horses, or interests in horses, registered with and
6meeting the requirements of any of the Arabian Horse Club
7Registry of America, Appaloosa Horse Club, American Quarter
8Horse Association, United States Trotting Association, or
9Jockey Club, as appropriate, used for purposes of breeding or
10racing for prizes. This item (27) is exempt from the provisions
11of Section 2-70, and the exemption provided for under this item
12(27) applies for all periods beginning May 30, 1995, but no
13claim for credit or refund is allowed on or after January 1,
142008 (the effective date of Public Act 95-88) for such taxes
15paid during the period beginning May 30, 2000 and ending on
16January 1, 2008 (the effective date of Public Act 95-88).
17    (28) Computers and communications equipment utilized for
18any hospital purpose and equipment used in the diagnosis,
19analysis, or treatment of hospital patients sold to a lessor
20who leases the equipment, under a lease of one year or longer
21executed or in effect at the time of the purchase, to a
22hospital that has been issued an active tax exemption
23identification number by the Department under Section 1g of
24this Act.
25    (29) Personal property sold to a lessor who leases the
26property, under a lease of one year or longer executed or in

 

 

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

 

 

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1"game breeding and hunting preserve area" as that term is used
2in the Wildlife Code. This paragraph is exempt from the
3provisions of Section 2-70.
4    (33) A motor vehicle, as that term is defined in Section
51-146 of the Illinois Vehicle Code, that is donated to a
6corporation, limited liability company, society, association,
7foundation, or institution that is determined by the Department
8to be organized and operated exclusively for educational
9purposes. For purposes of this exemption, "a corporation,
10limited liability company, society, association, foundation,
11or institution organized and operated exclusively for
12educational purposes" means all tax-supported public schools,
13private schools that offer systematic instruction in useful
14branches of learning by methods common to public schools and
15that compare favorably in their scope and intensity with the
16course of study presented in tax-supported schools, and
17vocational or technical schools or institutes organized and
18operated exclusively to provide a course of study of not less
19than 6 weeks duration and designed to prepare individuals to
20follow a trade or to pursue a manual, technical, mechanical,
21industrial, business, or commercial occupation.
22    (34) Beginning January 1, 2000, personal property,
23including food, purchased through fundraising events for the
24benefit of a public or private elementary or secondary school,
25a group of those schools, or one or more school districts if
26the events are sponsored by an entity recognized by the school

 

 

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1district that consists primarily of volunteers and includes
2parents and teachers of the school children. This paragraph
3does not apply to fundraising events (i) for the benefit of
4private home instruction or (ii) for which the fundraising
5entity purchases the personal property sold at the events from
6another individual or entity that sold the property for the
7purpose of resale by the fundraising entity and that profits
8from the sale to the fundraising entity. This paragraph is
9exempt from the provisions of Section 2-70.
10    (35) Beginning January 1, 2000 and through December 31,
112001, new or used automatic vending machines that prepare and
12serve hot food and beverages, including coffee, soup, and other
13items, and replacement parts for these machines. Beginning
14January 1, 2002 and through June 30, 2003, machines and parts
15for machines used in commercial, coin-operated amusement and
16vending business if a use or occupation tax is paid on the
17gross receipts derived from the use of the commercial,
18coin-operated amusement and vending machines. This paragraph
19is exempt from the provisions of Section 2-70.
20    (35-5) Beginning August 23, 2001 and through June 30, 2016,
21food for human consumption that is to be consumed off the
22premises where it is sold (other than alcoholic beverages, soft
23drinks, and food that has been prepared for immediate
24consumption) and prescription and nonprescription medicines,
25drugs, medical appliances, and insulin, urine testing
26materials, syringes, and needles used by diabetics, for human

 

 

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1use, when purchased for use by a person receiving medical
2assistance under Article V of the Illinois Public Aid Code who
3resides in a licensed long-term care facility, as defined in
4the Nursing Home Care Act, or a licensed facility as defined in
5the ID/DD Community Care Act, the MC/DD Act, or the Specialized
6Mental Health Rehabilitation Act of 2013.
7    (36) Beginning August 2, 2001, computers and
8communications equipment utilized for any hospital purpose and
9equipment used in the diagnosis, analysis, or treatment of
10hospital patients sold to a lessor who leases the equipment,
11under a lease of one year or longer executed or in effect at
12the time of the purchase, to a hospital that has been issued an
13active tax exemption identification number by the Department
14under Section 1g of this Act. This paragraph is exempt from the
15provisions of Section 2-70.
16    (37) Beginning August 2, 2001, personal property sold to a
17lessor who leases the property, under a lease of one year or
18longer executed or in effect at the time of the purchase, to a
19governmental body that has been issued an active tax exemption
20identification number by the Department under Section 1g of
21this Act. This paragraph is exempt from the provisions of
22Section 2-70.
23    (38) Beginning on January 1, 2002 and through June 30,
242016, tangible personal property purchased from an Illinois
25retailer by a taxpayer engaged in centralized purchasing
26activities in Illinois who will, upon receipt of the property

 

 

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1in Illinois, temporarily store the property in Illinois (i) for
2the purpose of subsequently transporting it outside this State
3for use or consumption thereafter solely outside this State or
4(ii) for the purpose of being processed, fabricated, or
5manufactured into, attached to, or incorporated into other
6tangible personal property to be transported outside this State
7and thereafter used or consumed solely outside this State. The
8Director of Revenue shall, pursuant to rules adopted in
9accordance with the Illinois Administrative Procedure Act,
10issue a permit to any taxpayer in good standing with the
11Department who is eligible for the exemption under this
12paragraph (38). The permit issued under this paragraph (38)
13shall authorize the holder, to the extent and in the manner
14specified in the rules adopted under this Act, to purchase
15tangible personal property from a retailer exempt from the
16taxes imposed by this Act. Taxpayers shall maintain all
17necessary books and records to substantiate the use and
18consumption of all such tangible personal property outside of
19the State of Illinois.
20    (39) 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 2-70.

 

 

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1    (40) 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 the sale of qualifying
16tangible personal property to persons who modify, refurbish,
17complete, replace, or maintain an aircraft and who (i) hold an
18Air Agency Certificate and are empowered to operate an approved
19repair station by the Federal Aviation Administration, (ii)
20have a Class IV Rating, and (iii) conduct operations in
21accordance with Part 145 of the Federal Aviation Regulations.
22The exemption does not include aircraft operated by a
23commercial air carrier providing scheduled passenger air
24service pursuant to authority issued under Part 121 or Part 129
25of the Federal Aviation Regulations. The changes made to this
26paragraph (40) by Public Act 98-534 are declarative of existing

 

 

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1law.
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) Beginning January 1, 2017, menstrual pads, tampons,
17and menstrual cups.
18    (43) Beginning on July 1, 2017, qualified tangible personal
19property used in the construction or operation of a data center
20that has been granted a certificate of exemption by the
21Department of Commerce and Economic Opportunity under Section
22605-1020 of the Department of Commerce and Economic Opportunity
23Law of the Civil Administrative Code of Illinois, whether that
24tangible personal property is purchased by the owner of the
25data center or by a contractor, subcontractor, or tenant of the
26owner. This paragraph is exempt from the provisions of Section

 

 

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12-70.
2(Source: P.A. 98-104, eff. 7-22-13; 98-422, eff. 8-16-13;
398-456, eff. 8-16-13; 98-534, eff. 8-23-13; 98-574, eff.
41-1-14; 98-583, eff. 1-1-14; 98-756, eff. 7-16-14; 99-180, eff.
57-29-15; 99-855, eff. 8-19-16.)
 
6    Section 30. The Electricity Excise Tax Law is amended by
7changing Section 2-4 as follows:
 
8    (35 ILCS 640/2-4)
9    Sec. 2-4. Tax imposed.
10    (a) Except as provided in subsection (b), a tax is imposed
11on the privilege of using in this State electricity purchased
12for use or consumption and not for resale, other than by
13municipal corporations owning and operating a local
14transportation system for public service, at the following
15rates per kilowatt-hour delivered to the purchaser:
16        (i) For the first 2000 kilowatt-hours used or consumed
17    in a month: 0.330 cents per kilowatt-hour;
18        (ii) For the next 48,000 kilowatt-hours used or
19    consumed in a month: 0.319 cents per kilowatt-hour;
20        (iii) For the next 50,000 kilowatt-hours used or
21    consumed in a month: 0.303 cents per kilowatt-hour;
22        (iv) For the next 400,000 kilowatt-hours used or
23    consumed in a month: 0.297 cents per kilowatt-hour;
24        (v) For the next 500,000 kilowatt-hours used or

 

 

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1    consumed in a month: 0.286 cents per kilowatt-hour;
2        (vi) For the next 2,000,000 kilowatt-hours used or
3    consumed in a month: 0.270 cents per kilowatt-hour;
4        (vii) For the next 2,000,000 kilowatt-hours used or
5    consumed in a month: 0.254 cents per kilowatt-hour;
6        (viii) For the next 5,000,000 kilowatt-hours used or
7    consumed in a month: 0.233 cents per kilowatt-hour;
8        (ix) For the next 10,000,000 kilowatt-hours used or
9    consumed in a month: 0.207 cents per kilowatt-hour;
10        (x) For all electricity in excess of 20,000,000
11    kilowatt-hours used or consumed in a month: 0.202 cents per
12    kilowatt-hour.
13    Provided, that in lieu of the foregoing rates, the tax is
14imposed on a self-assessing purchaser at the rate of 5.1% of
15the self-assessing purchaser's purchase price for all
16electricity distributed, supplied, furnished, sold,
17transmitted and delivered to the self-assessing purchaser in a
18month.
19    (b) A tax is imposed on the privilege of using in this
20State electricity purchased from a municipal system or electric
21cooperative, as defined in Article XVII of the Public Utilities
22Act, which has not made an election as permitted by either
23Section 17-200 or Section 17-300 of such Act, at the lesser of
240.32 cents per kilowatt hour of all electricity distributed,
25supplied, furnished, sold, transmitted, and delivered by such
26municipal system or electric cooperative to the purchaser or 5%

 

 

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1of each such purchaser's purchase price for all electricity
2distributed, supplied, furnished, sold, transmitted, and
3delivered by such municipal system or electric cooperative to
4the purchaser, whichever is the lower rate as applied to each
5purchaser in each billing period.
6    (c) The tax imposed by this Section 2-4 is not imposed with
7respect to any use of electricity by business enterprises
8certified under Section 9-222.1 or 9-222.1A of the Public
9Utilities Act, as amended, to the extent of such exemption and
10during the time specified by the Department of Commerce and
11Economic Opportunity; or with respect to any transaction in
12interstate commerce, or otherwise, to the extent to which such
13transaction may not, under the Constitution and statutes of the
14United States, be made the subject of taxation by this State.
15    (d) Beginning July 1, 2017, a business enterprise that is
16certified as a qualified data center, as defined by Section
17605-1020 of the Department of Commerce and Economic Opportunity
18Law of the Civil Administrative Code of Illinois, by the
19Department of Commerce and Economic Opportunity is exempt from
20the tax imposed under this Section. The Department of Commerce
21and Economic Opportunity may adopt rules to carry out the
22provisions of this subsection including procedures for
23applying for the exemption. The Department of Commerce and
24Economic Opportunity shall notify the Department of Revenue of
25the certification. The Department of Revenue shall then notify
26the public utility of the exemption status of the business

 

 

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1enterprise. The exemption shall take effect upon certification
2of the qualifying data center.
3(Source: P.A. 94-793, eff. 5-19-06.)
 
4    Section 99. Effective date. This Act takes effect upon
5becoming law.