HB5723 102ND GENERAL ASSEMBLY

  
  

 


 
102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB5723

 

Introduced 3/15/2022, by Rep. Mark Batinick - Patrick Windhorst - Paul Jacobs - Daniel Swanson

 

SYNOPSIS AS INTRODUCED:
 
35 ILCS 105/3-10
35 ILCS 110/3-10  from Ch. 120, par. 439.33-10
35 ILCS 115/3-10  from Ch. 120, par. 439.103-10
35 ILCS 120/2-10
35 ILCS 120/2d  from Ch. 120, par. 441d

    Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that, beginning 30 days after the effective date of the amendatory Act, the cents per gallon rate established by the Department of Revenue for the prepayment of tax by motor fuel retailers may not exceed $0.18 per gallon for motor fuel and 80% of that amount for gasohol and biodiesel blends. Provides that the rate of tax imposed under the Acts for motor fuel, gasohol, majority blended ethanol fuel, and biodiesel and biodiesel blends may not exceed that prepayment amount set by the Department of Revenue. Effective immediately.


LRB102 26700 HLH 37540 b

 

 

A BILL FOR

 

HB5723LRB102 26700 HLH 37540 b

1    AN ACT concerning revenue.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Use Tax Act is amended by changing Section
53-10 as follows:
 
6    (35 ILCS 105/3-10)
7    Sec. 3-10. Rate of tax. Unless otherwise provided in this
8Section, the tax imposed by this Act is at the rate of 6.25% of
9either the selling price or the fair market value, if any, of
10the tangible personal property. In all cases where property
11functionally used or consumed is the same as the property that
12was purchased at retail, then the tax is imposed on the selling
13price of the property. In all cases where property
14functionally used or consumed is a by-product or waste product
15that has been refined, manufactured, or produced from property
16purchased at retail, then the tax is imposed on the lower of
17the fair market value, if any, of the specific property so used
18in this State or on the selling price of the property purchased
19at retail. For purposes of this Section "fair market value"
20means the price at which property would change hands between a
21willing buyer and a willing seller, neither being under any
22compulsion to buy or sell and both having reasonable knowledge
23of the relevant facts. The fair market value shall be

 

 

HB5723- 2 -LRB102 26700 HLH 37540 b

1established by Illinois sales by the taxpayer of the same
2property as that functionally used or consumed, or if there
3are no such sales by the taxpayer, then comparable sales or
4purchases of property of like kind and character in Illinois.
5    Beginning on July 1, 2000 and through December 31, 2000,
6with respect to motor fuel, as defined in Section 1.1 of the
7Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
8the Use Tax Act, the tax is imposed at the rate of 1.25%.
9    Beginning 30 days after the effective date of this
10amendatory Act of the 102nd General Assembly, with respect to:
11motor fuel, as defined in Section 1.1 of the Motor Fuel Tax
12Law; gasohol, as defined in Section 3-40 of this Act; majority
13blended ethanol fuel; and biodiesel and biodiesel blends, the
14tax imposed under this Act may not exceed the cents per gallon
15rate established by the Department under subsection (e) of
16Section 2d of the Retailers' Occupation Tax Act. With respect
17to the tax imposed on biodiesel blends and gasohol, the
18maximum cents per gallon rate shall include the reduction
19allowed in subsection (e) of Section 2d of the Retailers'
20Occupation Tax Act.
21    Beginning on August 6, 2010 through August 15, 2010, with
22respect to sales tax holiday items as defined in Section 3-6 of
23this Act, the tax is imposed at the rate of 1.25%.
24    With respect to gasohol, the tax imposed by this Act
25applies to (i) 70% of the proceeds of sales made on or after
26January 1, 1990, and before July 1, 2003, (ii) 80% of the

 

 

HB5723- 3 -LRB102 26700 HLH 37540 b

1proceeds of sales made on or after July 1, 2003 and on or
2before July 1, 2017, and (iii) 100% of the proceeds of sales
3made thereafter. If, at any time, however, the tax under this
4Act on sales of gasohol is imposed at the rate of 1.25%, then
5the tax imposed by this Act applies to 100% of the proceeds of
6sales of gasohol made during that time.
7    With respect to majority blended ethanol fuel, the tax
8imposed by this Act does not apply to the proceeds of sales
9made on or after July 1, 2003 and on or before December 31,
102023 but applies to 100% of the proceeds of sales made
11thereafter.
12    With respect to biodiesel blends with no less than 1% and
13no more than 10% biodiesel, the tax imposed by this Act applies
14to (i) 80% of the proceeds of sales made on or after July 1,
152003 and on or before December 31, 2018 and (ii) 100% of the
16proceeds of sales made thereafter. If, at any time, however,
17the tax under this Act on sales of biodiesel blends with no
18less than 1% and no more than 10% biodiesel is imposed at the
19rate of 1.25%, then the tax imposed by this Act applies to 100%
20of the proceeds of sales of biodiesel blends with no less than
211% and no more than 10% biodiesel made during that time.
22    With respect to 100% biodiesel and biodiesel blends with
23more than 10% but no more than 99% biodiesel, the tax imposed
24by this Act does not apply to the proceeds of sales made on or
25after July 1, 2003 and on or before December 31, 2023 but
26applies to 100% of the proceeds of sales made thereafter.

 

 

HB5723- 4 -LRB102 26700 HLH 37540 b

1    With respect to food for human consumption that is to be
2consumed off the premises where it is sold (other than
3alcoholic beverages, food consisting of or infused with adult
4use cannabis, soft drinks, and food that has been prepared for
5immediate consumption) and prescription and nonprescription
6medicines, drugs, medical appliances, products classified as
7Class III medical devices by the United States Food and Drug
8Administration that are used for cancer treatment pursuant to
9a prescription, as well as any accessories and components
10related to those devices, modifications to a motor vehicle for
11the purpose of rendering it usable by a person with a
12disability, and insulin, blood sugar testing materials,
13syringes, and needles used by human diabetics, the tax is
14imposed at the rate of 1%. For the purposes of this Section,
15until September 1, 2009: the term "soft drinks" means any
16complete, finished, ready-to-use, non-alcoholic drink, whether
17carbonated or not, including but not limited to soda water,
18cola, fruit juice, vegetable juice, carbonated water, and all
19other preparations commonly known as soft drinks of whatever
20kind or description that are contained in any closed or sealed
21bottle, can, carton, or container, regardless of size; but
22"soft drinks" does not include coffee, tea, non-carbonated
23water, infant formula, milk or milk products as defined in the
24Grade A Pasteurized Milk and Milk Products Act, or drinks
25containing 50% or more natural fruit or vegetable juice.
26    Notwithstanding any other provisions of this Act,

 

 

HB5723- 5 -LRB102 26700 HLH 37540 b

1beginning September 1, 2009, "soft drinks" means non-alcoholic
2beverages that contain natural or artificial sweeteners. "Soft
3drinks" do not include beverages that contain milk or milk
4products, soy, rice or similar milk substitutes, or greater
5than 50% of vegetable or fruit juice by volume.
6    Until August 1, 2009, and notwithstanding any other
7provisions of this Act, "food for human consumption that is to
8be consumed off the premises where it is sold" includes all
9food sold through a vending machine, except soft drinks and
10food products that are dispensed hot from a vending machine,
11regardless of the location of the vending machine. Beginning
12August 1, 2009, and notwithstanding any other provisions of
13this Act, "food for human consumption that is to be consumed
14off the premises where it is sold" includes all food sold
15through a vending machine, except soft drinks, candy, and food
16products that are dispensed hot from a vending machine,
17regardless of the location of the vending machine.
18    Notwithstanding any other provisions of this Act,
19beginning September 1, 2009, "food for human consumption that
20is to be consumed off the premises where it is sold" does not
21include candy. For purposes of this Section, "candy" means a
22preparation of sugar, honey, or other natural or artificial
23sweeteners in combination with chocolate, fruits, nuts or
24other ingredients or flavorings in the form of bars, drops, or
25pieces. "Candy" does not include any preparation that contains
26flour or requires refrigeration.

 

 

HB5723- 6 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 7 -LRB102 26700 HLH 37540 b

1Compassionate Use of Medical Cannabis Program Act.
2    If the property that is purchased at retail from a
3retailer is acquired outside Illinois and used outside
4Illinois before being brought to Illinois for use here and is
5taxable under this Act, the "selling price" on which the tax is
6computed shall be reduced by an amount that represents a
7reasonable allowance for depreciation for the period of prior
8out-of-state use.
9(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
10102-4, eff. 4-27-21.)
 
11    Section 10. The Service Use Tax Act is amended by changing
12Section 3-10 as follows:
 
13    (35 ILCS 110/3-10)  (from Ch. 120, par. 439.33-10)
14    Sec. 3-10. Rate of tax. Unless otherwise provided in this
15Section, the tax imposed by this Act is at the rate of 6.25% of
16the selling price of tangible personal property transferred as
17an incident to the sale of service, but, for the purpose of
18computing this tax, in no event shall the selling price be less
19than the cost price of the property to the serviceman.
20    Beginning on July 1, 2000 and through December 31, 2000,
21with respect to motor fuel, as defined in Section 1.1 of the
22Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
23the Use Tax Act, the tax is imposed at the rate of 1.25%.
24    Beginning 30 days after the effective date of this

 

 

HB5723- 8 -LRB102 26700 HLH 37540 b

1amendatory Act of the 102nd General Assembly, with respect to:
2motor fuel, as defined in Section 1.1 of the Motor Fuel Tax
3Law; gasohol, as defined in Section 3-40 of the Use Tax Act;
4majority blended ethanol fuel; and biodiesel and biodiesel
5blends, the tax imposed under this Act may not exceed the cents
6per gallon rate established by the Department under subsection
7(e) of Section 2d of the Retailers' Occupation Tax Act. With
8respect to the tax imposed on biodiesel blends and gasohol,
9the maximum cents per gallon rate shall include the reduction
10allowed in subsection (e) of Section 2d of the Retailers'
11Occupation Tax Act.
12    With respect to gasohol, as defined in the Use Tax Act, the
13tax imposed by this Act applies to (i) 70% of the selling price
14of property transferred as an incident to the sale of service
15on or after January 1, 1990, and before July 1, 2003, (ii) 80%
16of the selling price of property transferred as an incident to
17the sale of service on or after July 1, 2003 and on or before
18July 1, 2017, and (iii) 100% of the selling price thereafter.
19If, at any time, however, the tax under this Act on sales of
20gasohol, as defined in the Use Tax Act, is imposed at the rate
21of 1.25%, then the tax imposed by this Act applies to 100% of
22the proceeds of sales of gasohol made during that time.
23    With respect to majority blended ethanol fuel, as defined
24in the Use Tax Act, the tax imposed by this Act does not apply
25to the selling price of property transferred as an incident to
26the sale of service on or after July 1, 2003 and on or before

 

 

HB5723- 9 -LRB102 26700 HLH 37540 b

1December 31, 2023 but applies to 100% of the selling price
2thereafter.
3    With respect to biodiesel blends, as defined in the Use
4Tax Act, with no less than 1% and no more than 10% biodiesel,
5the tax imposed by this Act applies to (i) 80% of the selling
6price of property transferred as an incident to the sale of
7service on or after July 1, 2003 and on or before December 31,
82018 and (ii) 100% of the proceeds of the selling price
9thereafter. If, at any time, however, the tax under this Act on
10sales of biodiesel blends, as defined in the Use Tax Act, with
11no less than 1% and no more than 10% biodiesel is imposed at
12the rate of 1.25%, then the tax imposed by this Act applies to
13100% of the proceeds of sales of biodiesel blends with no less
14than 1% and no more than 10% biodiesel made during that time.
15    With respect to 100% biodiesel, as defined in the Use Tax
16Act, and biodiesel blends, as defined in the Use Tax Act, with
17more than 10% but no more than 99% biodiesel, the tax imposed
18by this Act does not apply to the proceeds of the selling price
19of property transferred as an incident to the sale of service
20on or after July 1, 2003 and on or before December 31, 2023 but
21applies to 100% of the selling price thereafter.
22    At the election of any registered serviceman made for each
23fiscal year, sales of service in which the aggregate annual
24cost price of tangible personal property transferred as an
25incident to the sales of service is less than 35%, or 75% in
26the case of servicemen transferring prescription drugs or

 

 

HB5723- 10 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 11 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 12 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 13 -LRB102 26700 HLH 37540 b

1as required by 21 C.F.R. 201.66. The "over-the-counter-drug"
2label includes:
3        (A) A "Drug Facts" panel; or
4        (B) A statement of the "active ingredient(s)" with a
5    list of those ingredients contained in the compound,
6    substance or preparation.
7    Beginning on January 1, 2014 (the effective date of Public
8Act 98-122), "prescription and nonprescription medicines and
9drugs" includes medical cannabis purchased from a registered
10dispensing organization under the Compassionate Use of Medical
11Cannabis Program Act.
12    As used in this Section, "adult use cannabis" means
13cannabis subject to tax under the Cannabis Cultivation
14Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
15and does not include cannabis subject to tax under the
16Compassionate Use of Medical Cannabis Program Act.
17    If the property that is acquired from a serviceman is
18acquired outside Illinois and used outside Illinois before
19being brought to Illinois for use here and is taxable under
20this Act, the "selling price" on which the tax is computed
21shall be reduced by an amount that represents a reasonable
22allowance for depreciation for the period of prior
23out-of-state use.
24(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
25102-4, eff. 4-27-21; 102-16, eff. 6-17-21.)
 

 

 

HB5723- 14 -LRB102 26700 HLH 37540 b

1    Section 15. The Service Occupation Tax Act is amended by
2changing Section 3-10 as follows:
 
3    (35 ILCS 115/3-10)  (from Ch. 120, par. 439.103-10)
4    Sec. 3-10. Rate of tax. Unless otherwise provided in this
5Section, the tax imposed by this Act is at the rate of 6.25% of
6the "selling price", as defined in Section 2 of the Service Use
7Tax Act, of the tangible personal property. For the purpose of
8computing this tax, in no event shall the "selling price" be
9less than the cost price to the serviceman of the tangible
10personal property transferred. The selling price of each item
11of tangible personal property transferred as an incident of a
12sale of service may be shown as a distinct and separate item on
13the serviceman's billing to the service customer. If the
14selling price is not so shown, the selling price of the
15tangible personal property is deemed to be 50% of the
16serviceman's entire billing to the service customer. When,
17however, a serviceman contracts to design, develop, and
18produce special order machinery or equipment, the tax imposed
19by this Act shall be based on the serviceman's cost price of
20the tangible personal property transferred incident to the
21completion of the contract.
22    Beginning on July 1, 2000 and through December 31, 2000,
23with respect to motor fuel, as defined in Section 1.1 of the
24Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
25the Use Tax Act, the tax is imposed at the rate of 1.25%.

 

 

HB5723- 15 -LRB102 26700 HLH 37540 b

1    Beginning 30 days after the effective date of this
2amendatory Act of the 102nd General Assembly, with respect to:
3motor fuel, as defined in Section 1.1 of the Motor Fuel Tax
4Law; gasohol, as defined in Section 3-40 of the Use Tax Act;
5majority blended ethanol fuel; and biodiesel and biodiesel
6blends, the tax imposed under this Act may not exceed the cents
7per gallon rate established by the Department under subsection
8(e) of Section 2d of the Retailers' Occupation Tax Act. With
9respect to the tax imposed on biodiesel blends and gasohol,
10the maximum cents per gallon rate shall include the reduction
11allowed in subsection (e) of Section 2d of the Retailers'
12Occupation Tax Act.
13    With respect to gasohol, as defined in the Use Tax Act, the
14tax imposed by this Act shall apply to (i) 70% of the cost
15price of property transferred as an incident to the sale of
16service on or after January 1, 1990, and before July 1, 2003,
17(ii) 80% of the selling price of property transferred as an
18incident to the sale of service on or after July 1, 2003 and on
19or before July 1, 2017, and (iii) 100% of the cost price
20thereafter. If, at any time, however, the tax under this Act on
21sales of gasohol, as defined in the Use Tax Act, is imposed at
22the rate of 1.25%, then the tax imposed by this Act applies to
23100% of the proceeds of sales of gasohol made during that time.
24    With respect to majority blended ethanol fuel, as defined
25in the Use Tax Act, the tax imposed by this Act does not apply
26to the selling price of property transferred as an incident to

 

 

HB5723- 16 -LRB102 26700 HLH 37540 b

1the sale of service on or after July 1, 2003 and on or before
2December 31, 2023 but applies to 100% of the selling price
3thereafter.
4    With respect to biodiesel blends, as defined in the Use
5Tax Act, with no less than 1% and no more than 10% biodiesel,
6the tax imposed by this Act applies to (i) 80% of the selling
7price of property transferred as an incident to the sale of
8service on or after July 1, 2003 and on or before December 31,
92018 and (ii) 100% of the proceeds of the selling price
10thereafter. If, at any time, however, the tax under this Act on
11sales of biodiesel blends, as defined in the Use Tax Act, with
12no less than 1% and no more than 10% biodiesel is imposed at
13the rate of 1.25%, then the tax imposed by this Act applies to
14100% of the proceeds of sales of biodiesel blends with no less
15than 1% and no more than 10% biodiesel made during that time.
16    With respect to 100% biodiesel, as defined in the Use Tax
17Act, and biodiesel blends, as defined in the Use Tax Act, with
18more than 10% but no more than 99% biodiesel material, the tax
19imposed by this Act does not apply to the proceeds of the
20selling price of property transferred as an incident to the
21sale of service on or after July 1, 2003 and on or before
22December 31, 2023 but applies to 100% of the selling price
23thereafter.
24    At the election of any registered serviceman made for each
25fiscal year, sales of service in which the aggregate annual
26cost price of tangible personal property transferred as an

 

 

HB5723- 17 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 18 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 19 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 20 -LRB102 26700 HLH 37540 b

1this paragraph, "over-the-counter-drug" means a drug for human
2use that contains a label that identifies the product as a drug
3as required by 21 C.F.R. 201.66. The "over-the-counter-drug"
4label includes:
5        (A) A "Drug Facts" panel; or
6        (B) A statement of the "active ingredient(s)" with a
7    list of those ingredients contained in the compound,
8    substance or preparation.
9    Beginning on January 1, 2014 (the effective date of Public
10Act 98-122), "prescription and nonprescription medicines and
11drugs" includes medical cannabis purchased from a registered
12dispensing organization under the Compassionate Use of Medical
13Cannabis Program Act.
14    As used in this Section, "adult use cannabis" means
15cannabis subject to tax under the Cannabis Cultivation
16Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
17and does not include cannabis subject to tax under the
18Compassionate Use of Medical Cannabis Program Act.
19(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
20102-4, eff. 4-27-21; 102-16, eff. 6-17-21.)
 
21    Section 20. The Retailers' Occupation Tax Act is amended
22by changing Sections 2-10 and 2d as follows:
 
23    (35 ILCS 120/2-10)
24    Sec. 2-10. Rate of tax. Unless otherwise provided in this

 

 

HB5723- 21 -LRB102 26700 HLH 37540 b

1Section, the tax imposed by this Act is at the rate of 6.25% of
2gross receipts from sales of tangible personal property made
3in the course of business.
4    Beginning on July 1, 2000 and through December 31, 2000,
5with respect to motor fuel, as defined in Section 1.1 of the
6Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
7the Use Tax Act, the tax is imposed at the rate of 1.25%.
8    Beginning 30 days after the effective date of this
9amendatory Act of the 102nd General Assembly, with respect to:
10motor fuel, as defined in Section 1.1 of the Motor Fuel Tax
11Law; gasohol, as defined in Section 3-40 of the Use Tax Act;
12majority blended ethanol fuel; and biodiesel and biodiesel
13blends, the tax imposed under this Act may not exceed the cents
14per gallon rate established by the Department under subsection
15(e) of Section 2d of this Act. With respect to the tax imposed
16on biodiesel blends and gasohol, the maximum cents per gallon
17rate shall include the reduction allowed in subsection (e) of
18Section 2d of the Retailers' Occupation Tax Act.
19    Beginning on August 6, 2010 through August 15, 2010, with
20respect to sales tax holiday items as defined in Section 2-8 of
21this Act, the tax is imposed at the rate of 1.25%.
22    Within 14 days after the effective date of this amendatory
23Act of the 91st General Assembly, each retailer of motor fuel
24and gasohol shall cause the following notice to be posted in a
25prominently visible place on each retail dispensing device
26that is used to dispense motor fuel or gasohol in the State of

 

 

HB5723- 22 -LRB102 26700 HLH 37540 b

1Illinois: "As of July 1, 2000, the State of Illinois has
2eliminated the State's share of sales tax on motor fuel and
3gasohol through December 31, 2000. The price on this pump
4should reflect the elimination of the tax." The notice shall
5be printed in bold print on a sign that is no smaller than 4
6inches by 8 inches. The sign shall be clearly visible to
7customers. Any retailer who fails to post or maintain a
8required sign through December 31, 2000 is guilty of a petty
9offense for which the fine shall be $500 per day per each
10retail premises where a violation occurs.
11    With respect to gasohol, as defined in the Use Tax Act, the
12tax imposed by this Act applies to (i) 70% of the proceeds of
13sales made on or after January 1, 1990, and before July 1,
142003, (ii) 80% of the proceeds of sales made on or after July
151, 2003 and on or before July 1, 2017, and (iii) 100% of the
16proceeds of sales made thereafter. If, at any time, however,
17the tax under this Act on sales of gasohol, as defined in the
18Use Tax Act, is imposed at the rate of 1.25%, then the tax
19imposed by this Act applies to 100% of the proceeds of sales of
20gasohol made during that time.
21    With respect to majority blended ethanol fuel, as defined
22in the Use Tax Act, the tax imposed by this Act does not apply
23to the proceeds of sales made on or after July 1, 2003 and on
24or before December 31, 2023 but applies to 100% of the proceeds
25of sales made thereafter.
26    With respect to biodiesel blends, as defined in the Use

 

 

HB5723- 23 -LRB102 26700 HLH 37540 b

1Tax Act, with no less than 1% and no more than 10% biodiesel,
2the tax imposed by this Act applies to (i) 80% of the proceeds
3of sales made on or after July 1, 2003 and on or before
4December 31, 2018 and (ii) 100% of the proceeds of sales made
5thereafter. If, at any time, however, the tax under this Act on
6sales of biodiesel blends, as defined in the Use Tax Act, with
7no less than 1% and no more than 10% biodiesel is imposed at
8the rate of 1.25%, then the tax imposed by this Act applies to
9100% of the proceeds of sales of biodiesel blends with no less
10than 1% and no more than 10% biodiesel made during that time.
11    With respect to 100% biodiesel, as defined in the Use Tax
12Act, and biodiesel blends, as defined in the Use Tax Act, with
13more than 10% but no more than 99% biodiesel, the tax imposed
14by this Act does not apply to the proceeds of sales made on or
15after July 1, 2003 and on or before December 31, 2023 but
16applies to 100% of the proceeds of sales made thereafter.
17    With respect to food for human consumption that is to be
18consumed off the premises where it is sold (other than
19alcoholic beverages, food consisting of or infused with adult
20use cannabis, soft drinks, and food that has been prepared for
21immediate consumption) and prescription and nonprescription
22medicines, drugs, medical appliances, products classified as
23Class III medical devices by the United States Food and Drug
24Administration that are used for cancer treatment pursuant to
25a prescription, as well as any accessories and components
26related to those devices, modifications to a motor vehicle for

 

 

HB5723- 24 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 25 -LRB102 26700 HLH 37540 b

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

 

 

HB5723- 26 -LRB102 26700 HLH 37540 b

1use that contains a label that identifies the product as a drug
2as required by 21 C.F.R. 201.66. The "over-the-counter-drug"
3label includes:
4        (A) A "Drug Facts" panel; or
5        (B) A statement of the "active ingredient(s)" with a
6    list of those ingredients contained in the compound,
7    substance or preparation.
8    Beginning on the effective date of this amendatory Act of
9the 98th General Assembly, "prescription and nonprescription
10medicines and drugs" includes medical cannabis purchased from
11a registered dispensing organization under the Compassionate
12Use of Medical Cannabis Program Act.
13    As used in this Section, "adult use cannabis" means
14cannabis subject to tax under the Cannabis Cultivation
15Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
16and does not include cannabis subject to tax under the
17Compassionate Use of Medical Cannabis Program Act.
18(Source: P.A. 101-363, eff. 8-9-19; 101-593, eff. 12-4-19;
19102-4, eff. 4-27-21.)
 
20    (35 ILCS 120/2d)  (from Ch. 120, par. 441d)
21    Sec. 2d. Tax prepayment by motor fuel retailer.
22    (a) Any person engaged in the business of selling motor
23fuel at retail, as defined in the Motor Fuel Tax Law, and who
24is not a licensed distributor or supplier, as defined in the
25Motor Fuel Tax Law, shall prepay to his or her distributor,

 

 

HB5723- 27 -LRB102 26700 HLH 37540 b

1supplier, or other reseller of motor fuel a portion of the tax
2imposed by this Act if the distributor, supplier, or other
3reseller of motor fuel is registered under Section 2a or
4Section 2c of this Act. The prepayment requirement provided
5for in this Section does not apply to liquid propane gas.
6    (b) Beginning on July 1, 2000 and through December 31,
72000, the Retailers' Occupation Tax paid to the distributor,
8supplier, or other reseller shall be an amount equal to $0.01
9per gallon of the motor fuel, except gasohol as defined in
10Section 2-10 of this Act which shall be an amount equal to
11$0.01 per gallon, purchased from the distributor, supplier, or
12other reseller.
13    (c) Before July 1, 2000 and then beginning on January 1,
142001 and through June 30, 2003, the Retailers' Occupation Tax
15paid to the distributor, supplier, or other reseller shall be
16an amount equal to $0.04 per gallon of the motor fuel, except
17gasohol as defined in Section 2-10 of this Act which shall be
18an amount equal to $0.03 per gallon, purchased from the
19distributor, supplier, or other reseller.
20    (d) Beginning July 1, 2003 and through December 31, 2010,
21the Retailers' Occupation Tax paid to the distributor,
22supplier, or other reseller shall be an amount equal to $0.06
23per gallon of the motor fuel, except gasohol as defined in
24Section 2-10 of this Act which shall be an amount equal to
25$0.05 per gallon, purchased from the distributor, supplier, or
26other reseller.

 

 

HB5723- 28 -LRB102 26700 HLH 37540 b

1    (e) Beginning on January 1, 2011 and thereafter, the
2Retailers' Occupation Tax paid to the distributor, supplier,
3or other reseller shall be at the rate established by the
4Department under this subsection. The rate shall be
5established by the Department on January 1 and July 1 of each
6year using the average selling price, as defined in Section 1
7of this Act, per gallon of motor fuel sold in the State during
8the previous 6 months and multiplying that amount by 6.25% to
9determine the cents per gallon rate. Beginning 30 days after
10the effective date of this amendatory Act of the 102nd General
11Assembly, the cents per gallon rate established by the
12Department for motor fuel under this subsection may not exceed
13$0.18 per gallon. In the case of biodiesel blends, as defined
14in Section 3-42 of the Use Tax Act, with no less than 1% and no
15more than 10% biodiesel, and in the case of gasohol, as defined
16in Section 3-40 of the Use Tax Act, the rate shall be 80% of
17the rate established by the Department under this subsection
18for motor fuel. The Department shall provide persons subject
19to this Section notice of the rate established under this
20subsection at least 20 days prior to each January 1 and July 1.
21The Department shall provide persons subject to this Section
22notice of the rate change required by this amendatory Act of
23the 102nd General Assembly at least 20 days prior to the date
24on which that change takes effect. Publication of the
25established rate on the Department's internet website shall
26constitute sufficient notice under this Section. The

 

 

HB5723- 29 -LRB102 26700 HLH 37540 b

1Department may use data derived from independent surveys
2conducted or accumulated by third parties to determine the
3average selling price per gallon of motor fuel sold in the
4State.
5    (f) Any person engaged in the business of selling motor
6fuel at retail shall be entitled to a credit against tax due
7under this Act in an amount equal to the tax paid to the
8distributor, supplier, or other reseller.
9    (g) Every distributor, supplier, or other reseller
10registered as provided in Section 2a or Section 2c of this Act
11shall remit the prepaid tax on all motor fuel that is due from
12any person engaged in the business of selling at retail motor
13fuel with the returns filed under Section 2f or Section 3 of
14this Act, but the vendors discount provided in Section 3 shall
15not apply to the amount of prepaid tax that is remitted. Any
16distributor or supplier who fails to properly collect and
17remit the tax shall be liable for the tax. For purposes of this
18Section, the prepaid tax is due on invoiced gallons sold
19during a month by the 20th day of the following month.
20(Source: P.A. 96-1384, eff. 7-29-10.)
 
21    Section 99. Effective date. This Act takes effect upon
22becoming law.