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91_HB2184
LRB9103467PTpk
1 AN ACT concerning taxation.
2 Be it enacted by the People of the State of Illinois,
3 represented in the General Assembly:
4 Section 5. The Use Tax Act is amended by changing
5 Section 3-5 as follows:
6 (35 ILCS 105/3-5) (from Ch. 120, par. 439.3-5)
7 Sec. 3-5. Exemptions. Use of the following tangible
8 personal property is exempt from the tax imposed by this Act:
9 (1) Personal property purchased from a corporation,
10 society, association, foundation, institution, or
11 organization, other than a limited liability company, that is
12 organized and operated as a not-for-profit service enterprise
13 for the benefit of persons 65 years of age or older if the
14 personal property was not purchased by the enterprise for the
15 purpose of resale by the enterprise.
16 (2) Personal property purchased by a not-for-profit
17 Illinois county fair association for use in conducting,
18 operating, or promoting the county fair.
19 (3) Personal property purchased by a not-for-profit
20 music or dramatic arts organization that establishes, by
21 proof required by the Department by rule, that it has
22 received an exemption under Section 501(c)(3) of the Internal
23 Revenue Code and that is organized and operated for the
24 presentation of live public performances of musical or
25 theatrical works on a regular basis.
26 (4) Personal property purchased by a governmental body,
27 by a corporation, society, association, foundation, or
28 institution organized and operated exclusively for
29 charitable, religious, or educational purposes, or by a
30 not-for-profit corporation, society, association, foundation,
31 institution, or organization that has no compensated officers
-2- LRB9103467PTpk
1 or employees and that is organized and operated primarily for
2 the recreation of persons 55 years of age or older. A limited
3 liability company may qualify for the exemption under this
4 paragraph only if the limited liability company is organized
5 and operated exclusively for educational purposes. On and
6 after July 1, 1987, however, no entity otherwise eligible for
7 this exemption shall make tax-free purchases unless it has an
8 active exemption identification number issued by the
9 Department.
10 (5) A passenger car that is a replacement vehicle to the
11 extent that the purchase price of the car is subject to the
12 Replacement Vehicle Tax.
13 (6) Graphic arts machinery and equipment, including
14 repair and replacement parts, both new and used, and
15 including that manufactured on special order, certified by
16 the purchaser to be used primarily for graphic arts
17 production, and including machinery and equipment purchased
18 for lease.
19 (7) Farm chemicals.
20 (8) Legal tender, currency, medallions, or gold or
21 silver coinage issued by the State of Illinois, the
22 government of the United States of America, or the government
23 of any foreign country, and bullion.
24 (9) Personal property purchased from a teacher-sponsored
25 student organization affiliated with an elementary or
26 secondary school located in Illinois.
27 (10) A motor vehicle of the first division, a motor
28 vehicle of the second division that is a self-contained motor
29 vehicle designed or permanently converted to provide living
30 quarters for recreational, camping, or travel use, with
31 direct walk through to the living quarters from the driver's
32 seat, or a motor vehicle of the second division that is of
33 the van configuration designed for the transportation of not
34 less than 7 nor more than 16 passengers, as defined in
-3- LRB9103467PTpk
1 Section 1-146 of the Illinois Vehicle Code, that is used for
2 automobile renting, as defined in the Automobile Renting
3 Occupation and Use Tax Act.
4 (11) Farm machinery and equipment purchased for more
5 than $250, both new and used, including that manufactured on
6 special order, certified by the purchaser to be used
7 primarily for production agriculture or State or federal
8 agricultural programs, including individual replacement parts
9 for the machinery and equipment, including machinery and
10 equipment purchased for lease, and including implements of
11 husbandry defined in Section 1-130 of the Illinois Vehicle
12 Code, farm machinery and agricultural chemical and fertilizer
13 spreaders, and nurse wagons required to be registered under
14 Section 3-809 of the Illinois Vehicle Code, but excluding
15 other motor vehicles required to be registered under the
16 Illinois Vehicle Code. Horticultural polyhouses or hoop
17 houses used for propagating, growing, or overwintering plants
18 shall be considered farm machinery and equipment under this
19 item (11). Agricultural chemical tender tanks and dry boxes
20 shall include units sold separately from a motor vehicle
21 required to be licensed and units sold mounted on a motor
22 vehicle required to be licensed if the selling price of the
23 tender is separately stated.
24 Farm machinery and equipment shall include precision
25 farming equipment that is installed or purchased to be
26 installed on farm machinery and equipment including, but not
27 limited to, tractors, harvesters, sprayers, planters,
28 seeders, or spreaders. Precision farming equipment includes,
29 but is not limited to, soil testing sensors, computers,
30 monitors, software, global positioning and mapping systems,
31 and other such equipment.
32 Farm machinery and equipment also includes computers,
33 sensors, software, and related equipment used primarily in
34 the computer-assisted operation of production agriculture
-4- LRB9103467PTpk
1 facilities, equipment, and activities such as, but not
2 limited to, the collection, monitoring, and correlation of
3 animal and crop data for the purpose of formulating animal
4 diets and agricultural chemicals. This item (11) is exempt
5 from the provisions of Section 3-90.
6 (12) Fuel and petroleum products sold to or used by an
7 air common carrier, certified by the carrier to be used for
8 consumption, shipment, or storage in the conduct of its
9 business as an air common carrier, for a flight destined for
10 or returning from a location or locations outside the United
11 States without regard to previous or subsequent domestic
12 stopovers.
13 (13) Proceeds of mandatory service charges separately
14 stated on customers' bills for the purchase and consumption
15 of food and beverages purchased at retail from a retailer, to
16 the extent that the proceeds of the service charge are in
17 fact turned over as tips or as a substitute for tips to the
18 employees who participate directly in preparing, serving,
19 hosting or cleaning up the food or beverage function with
20 respect to which the service charge is imposed.
21 (14) Oil field exploration, drilling, and production
22 equipment, including (i) rigs and parts of rigs, rotary rigs,
23 cable tool rigs, and workover rigs, (ii) pipe and tubular
24 goods, including casing and drill strings, (iii) pumps and
25 pump-jack units, (iv) storage tanks and flow lines, (v) any
26 individual replacement part for oil field exploration,
27 drilling, and production equipment, and (vi) machinery and
28 equipment purchased for lease; but excluding motor vehicles
29 required to be registered under the Illinois Vehicle Code.
30 (15) Photoprocessing machinery and equipment, including
31 repair and replacement parts, both new and used, including
32 that manufactured on special order, certified by the
33 purchaser to be used primarily for photoprocessing, and
34 including photoprocessing machinery and equipment purchased
-5- LRB9103467PTpk
1 for lease.
2 (16) Coal exploration, mining, offhighway hauling,
3 processing, maintenance, and reclamation equipment, including
4 replacement parts and equipment, and including equipment
5 purchased for lease, but excluding motor vehicles required to
6 be registered under the Illinois Vehicle Code.
7 (17) Distillation machinery and equipment, sold as a
8 unit or kit, assembled or installed by the retailer,
9 certified by the user to be used only for the production of
10 ethyl alcohol that will be used for consumption as motor fuel
11 or as a component of motor fuel for the personal use of the
12 user, and not subject to sale or resale.
13 (18) Manufacturing and assembling machinery and
14 equipment used primarily in the process of manufacturing or
15 assembling tangible personal property for wholesale or retail
16 sale or lease, whether that sale or lease is made directly by
17 the manufacturer or by some other person, whether the
18 materials used in the process are owned by the manufacturer
19 or some other person, or whether that sale or lease is made
20 apart from or as an incident to the seller's engaging in the
21 service occupation of producing machines, tools, dies, jigs,
22 patterns, gauges, or other similar items of no commercial
23 value on special order for a particular purchaser.
24 (19) Personal property delivered to a purchaser or
25 purchaser's donee inside Illinois when the purchase order for
26 that personal property was received by a florist located
27 outside Illinois who has a florist located inside Illinois
28 deliver the personal property.
29 (20) Semen used for artificial insemination of livestock
30 for direct agricultural production.
31 (21) Horses, or interests in horses, registered with and
32 meeting the requirements of any of the Arabian Horse Club
33 Registry of America, Appaloosa Horse Club, American Quarter
34 Horse Association, United States Trotting Association, or
-6- LRB9103467PTpk
1 Jockey Club, as appropriate, used for purposes of breeding or
2 racing for prizes.
3 (22) Computers and communications equipment utilized for
4 any hospital purpose and equipment used in the diagnosis,
5 analysis, or treatment of hospital patients purchased by a
6 lessor who leases the equipment, under a lease of one year or
7 longer executed or in effect at the time the lessor would
8 otherwise be subject to the tax imposed by this Act, to a
9 hospital that has been issued an active tax exemption
10 identification number by the Department under Section 1g of
11 the Retailers' Occupation Tax Act. If the equipment is
12 leased in a manner that does not qualify for this exemption
13 or is used in any other non-exempt manner, the lessor shall
14 be liable for the tax imposed under this Act or the Service
15 Use Tax Act, as the case may be, based on the fair market
16 value of the property at the time the non-qualifying use
17 occurs. No lessor shall collect or attempt to collect an
18 amount (however designated) that purports to reimburse that
19 lessor for the tax imposed by this Act or the Service Use Tax
20 Act, as the case may be, if the tax has not been paid by the
21 lessor. If a lessor improperly collects any such amount from
22 the lessee, the lessee shall have a legal right to claim a
23 refund of that amount from the lessor. If, however, that
24 amount is not refunded to the lessee for any reason, the
25 lessor is liable to pay that amount to the Department.
26 (23) Personal property purchased by a lessor who leases
27 the property, under a lease of one year or longer executed
28 or in effect at the time the lessor would otherwise be
29 subject to the tax imposed by this Act, to a governmental
30 body that has been issued an active sales tax exemption
31 identification number by the Department under Section 1g of
32 the Retailers' Occupation Tax Act. If the property is leased
33 in a manner that does not qualify for this exemption or used
34 in any other non-exempt manner, the lessor shall be liable
-7- LRB9103467PTpk
1 for the tax imposed under this Act or the Service Use Tax
2 Act, as the case may be, based on the fair market value of
3 the property at the time the non-qualifying use occurs. No
4 lessor shall collect or attempt to collect an amount (however
5 designated) that purports to reimburse that lessor for the
6 tax imposed by this Act or the Service Use Tax Act, as the
7 case may be, if the tax has not been paid by the lessor. If
8 a lessor improperly collects any such amount from the lessee,
9 the lessee shall have a legal right to claim a refund of that
10 amount from the lessor. If, however, that amount is not
11 refunded to the lessee for any reason, the lessor is liable
12 to pay that amount to the Department.
13 (24) Beginning with taxable years ending on or after
14 December 31, 1995 and ending with taxable years ending on or
15 before December 31, 2004, personal property that is donated
16 for disaster relief to be used in a State or federally
17 declared disaster area in Illinois or bordering Illinois by a
18 manufacturer or retailer that is registered in this State to
19 a corporation, society, association, foundation, or
20 institution that has been issued a sales tax exemption
21 identification number by the Department that assists victims
22 of the disaster who reside within the declared disaster area.
23 (25) Beginning with taxable years ending on or after
24 December 31, 1995 and ending with taxable years ending on or
25 before December 31, 2004, personal property that is used in
26 the performance of infrastructure repairs in this State,
27 including but not limited to municipal roads and streets,
28 access roads, bridges, sidewalks, waste disposal systems,
29 water and sewer line extensions, water distribution and
30 purification facilities, storm water drainage and retention
31 facilities, and sewage treatment facilities, resulting from a
32 State or federally declared disaster in Illinois or bordering
33 Illinois when such repairs are initiated on facilities
34 located in the declared disaster area within 6 months after
-8- LRB9103467PTpk
1 the disaster.
2 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
3 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
4 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
5 eff. 12-12-97; 90-605, eff. 6-30-98.)
6 Section 10. The Service Use Tax Act is amended by
7 changing Section 3-5 as follows:
8 (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
9 Sec. 3-5. Exemptions. Use of the following tangible
10 personal property is exempt from the tax imposed by this Act:
11 (1) Personal property purchased from a corporation,
12 society, association, foundation, institution, or
13 organization, other than a limited liability company, that is
14 organized and operated as a not-for-profit service enterprise
15 for the benefit of persons 65 years of age or older if the
16 personal property was not purchased by the enterprise for the
17 purpose of resale by the enterprise.
18 (2) Personal property purchased by a non-profit Illinois
19 county fair association for use in conducting, operating, or
20 promoting the county fair.
21 (3) Personal property purchased by a not-for-profit
22 music or dramatic arts organization that establishes, by
23 proof required by the Department by rule, that it has
24 received an exemption under Section 501(c)(3) of the Internal
25 Revenue Code and that is organized and operated for the
26 presentation of live public performances of musical or
27 theatrical works on a regular basis.
28 (4) Legal tender, currency, medallions, or gold or
29 silver coinage issued by the State of Illinois, the
30 government of the United States of America, or the government
31 of any foreign country, and bullion.
32 (5) Graphic arts machinery and equipment, including
-9- LRB9103467PTpk
1 repair and replacement parts, both new and used, and
2 including that manufactured on special order or purchased for
3 lease, certified by the purchaser to be used primarily for
4 graphic arts production.
5 (6) Personal property purchased from a teacher-sponsored
6 student organization affiliated with an elementary or
7 secondary school located in Illinois.
8 (7) Farm machinery and equipment purchased for more than
9 $250, both new and used, including that manufactured on
10 special order, certified by the purchaser to be used
11 primarily for production agriculture or State or federal
12 agricultural programs, including individual replacement parts
13 for the machinery and equipment, including machinery and
14 equipment purchased for lease, and including implements of
15 husbandry defined in Section 1-130 of the Illinois Vehicle
16 Code, farm machinery and agricultural chemical and fertilizer
17 spreaders, and nurse wagons required to be registered under
18 Section 3-809 of the Illinois Vehicle Code, but excluding
19 other motor vehicles required to be registered under the
20 Illinois Vehicle Code. Horticultural polyhouses or hoop
21 houses used for propagating, growing, or overwintering plants
22 shall be considered farm machinery and equipment under this
23 item (7). Agricultural chemical tender tanks and dry boxes
24 shall include units sold separately from a motor vehicle
25 required to be licensed and units sold mounted on a motor
26 vehicle required to be licensed if the selling price of the
27 tender is separately stated.
28 Farm machinery and equipment shall include precision
29 farming equipment that is installed or purchased to be
30 installed on farm machinery and equipment including, but not
31 limited to, tractors, harvesters, sprayers, planters,
32 seeders, or spreaders. Precision farming equipment includes,
33 but is not limited to, soil testing sensors, computers,
34 monitors, software, global positioning and mapping systems,
-10- LRB9103467PTpk
1 and other such equipment.
2 Farm machinery and equipment also includes computers,
3 sensors, software, and related equipment used primarily in
4 the computer-assisted operation of production agriculture
5 facilities, equipment, and activities such as, but not
6 limited to, the collection, monitoring, and correlation of
7 animal and crop data for the purpose of formulating animal
8 diets and agricultural chemicals. This item (7) is exempt
9 from the provisions of Section 3-75.
10 (8) Fuel and petroleum products sold to or used by an
11 air common carrier, certified by the carrier to be used for
12 consumption, shipment, or storage in the conduct of its
13 business as an air common carrier, for a flight destined for
14 or returning from a location or locations outside the United
15 States without regard to previous or subsequent domestic
16 stopovers.
17 (9) Proceeds of mandatory service charges separately
18 stated on customers' bills for the purchase and consumption
19 of food and beverages acquired as an incident to the purchase
20 of a service from a serviceman, to the extent that the
21 proceeds of the service charge are in fact turned over as
22 tips or as a substitute for tips to the employees who
23 participate directly in preparing, serving, hosting or
24 cleaning up the food or beverage function with respect to
25 which the service charge is imposed.
26 (10) Oil field exploration, drilling, and production
27 equipment, including (i) rigs and parts of rigs, rotary rigs,
28 cable tool rigs, and workover rigs, (ii) pipe and tubular
29 goods, including casing and drill strings, (iii) pumps and
30 pump-jack units, (iv) storage tanks and flow lines, (v) any
31 individual replacement part for oil field exploration,
32 drilling, and production equipment, and (vi) machinery and
33 equipment purchased for lease; but excluding motor vehicles
34 required to be registered under the Illinois Vehicle Code.
-11- LRB9103467PTpk
1 (11) Proceeds from the sale of photoprocessing machinery
2 and equipment, including repair and replacement parts, both
3 new and used, including that manufactured on special order,
4 certified by the purchaser to be used primarily for
5 photoprocessing, and including photoprocessing machinery and
6 equipment purchased for lease.
7 (12) Coal exploration, mining, offhighway hauling,
8 processing, maintenance, and reclamation equipment, including
9 replacement parts and equipment, and including equipment
10 purchased for lease, but excluding motor vehicles required to
11 be registered under the Illinois Vehicle Code.
12 (13) Semen used for artificial insemination of livestock
13 for direct agricultural production.
14 (14) Horses, or interests in horses, registered with and
15 meeting the requirements of any of the Arabian Horse Club
16 Registry of America, Appaloosa Horse Club, American Quarter
17 Horse Association, United States Trotting Association, or
18 Jockey Club, as appropriate, used for purposes of breeding or
19 racing for prizes.
20 (15) Computers and communications equipment utilized for
21 any hospital purpose and equipment used in the diagnosis,
22 analysis, or treatment of hospital patients purchased by a
23 lessor who leases the equipment, under a lease of one year or
24 longer executed or in effect at the time the lessor would
25 otherwise be subject to the tax imposed by this Act, to a
26 hospital that has been issued an active tax exemption
27 identification number by the Department under Section 1g of
28 the Retailers' Occupation Tax Act. If the equipment is leased
29 in a manner that does not qualify for this exemption or is
30 used in any other non-exempt manner, the lessor shall be
31 liable for the tax imposed under this Act or the Use Tax Act,
32 as the case may be, based on the fair market value of the
33 property at the time the non-qualifying use occurs. No
34 lessor shall collect or attempt to collect an amount (however
-12- LRB9103467PTpk
1 designated) that purports to reimburse that lessor for the
2 tax imposed by this Act or the Use Tax Act, as the case may
3 be, if the tax has not been paid by the lessor. If a lessor
4 improperly collects any such amount from the lessee, the
5 lessee shall have a legal right to claim a refund of that
6 amount from the lessor. If, however, that amount is not
7 refunded to the lessee for any reason, the lessor is liable
8 to pay that amount to the Department.
9 (16) Personal property purchased by a lessor who leases
10 the property, under a lease of one year or longer executed or
11 in effect at the time the lessor would otherwise be subject
12 to the tax imposed by this Act, to a governmental body that
13 has been issued an active tax exemption identification number
14 by the Department under Section 1g of the Retailers'
15 Occupation Tax Act. If the property is leased in a manner
16 that does not qualify for this exemption or is used in any
17 other non-exempt manner, the lessor shall be liable for the
18 tax imposed under this Act or the Use Tax Act, as the case
19 may be, based on the fair market value of the property at the
20 time the non-qualifying use occurs. No lessor shall collect
21 or attempt to collect an amount (however designated) that
22 purports to reimburse that lessor for the tax imposed by this
23 Act or the Use Tax Act, as the case may be, if the tax has
24 not been paid by the lessor. If a lessor improperly collects
25 any such amount from the lessee, the lessee shall have a
26 legal right to claim a refund of that amount from the lessor.
27 If, however, that amount is not refunded to the lessee for
28 any reason, the lessor is liable to pay that amount to the
29 Department.
30 (17) Beginning with taxable years ending on or after
31 December 31, 1995 and ending with taxable years ending on or
32 before December 31, 2004, personal property that is donated
33 for disaster relief to be used in a State or federally
34 declared disaster area in Illinois or bordering Illinois by a
-13- LRB9103467PTpk
1 manufacturer or retailer that is registered in this State to
2 a corporation, society, association, foundation, or
3 institution that has been issued a sales tax exemption
4 identification number by the Department that assists victims
5 of the disaster who reside within the declared disaster area.
6 (18) Beginning with taxable years ending on or after
7 December 31, 1995 and ending with taxable years ending on or
8 before December 31, 2004, personal property that is used in
9 the performance of infrastructure repairs in this State,
10 including but not limited to municipal roads and streets,
11 access roads, bridges, sidewalks, waste disposal systems,
12 water and sewer line extensions, water distribution and
13 purification facilities, storm water drainage and retention
14 facilities, and sewage treatment facilities, resulting from a
15 State or federally declared disaster in Illinois or bordering
16 Illinois when such repairs are initiated on facilities
17 located in the declared disaster area within 6 months after
18 the disaster.
19 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
20 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
21 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
22 eff. 12-12-97; 90-605, eff. 6-30-98.)
23 Section 15. The Service Occupation Tax Act is amended by
24 changing Section 3-5 as follows:
25 (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
26 Sec. 3-5. Exemptions. The following tangible personal
27 property is exempt from the tax imposed by this Act:
28 (1) Personal property sold by a corporation, society,
29 association, foundation, institution, or organization, other
30 than a limited liability company, that is organized and
31 operated as a not-for-profit service enterprise for the
32 benefit of persons 65 years of age or older if the personal
-14- LRB9103467PTpk
1 property was not purchased by the enterprise for the purpose
2 of resale by the enterprise.
3 (2) Personal property purchased by a not-for-profit
4 Illinois county fair association for use in conducting,
5 operating, or promoting the county fair.
6 (3) Personal property purchased by any not-for-profit
7 music or dramatic arts organization that establishes, by
8 proof required by the Department by rule, that it has
9 received an exemption under Section 501(c)(3) of the
10 Internal Revenue Code and that is organized and operated for
11 the presentation of live public performances of musical or
12 theatrical works on a regular basis.
13 (4) Legal tender, currency, medallions, or gold or
14 silver coinage issued by the State of Illinois, the
15 government of the United States of America, or the government
16 of any foreign country, and bullion.
17 (5) Graphic arts machinery and equipment, including
18 repair and replacement parts, both new and used, and
19 including that manufactured on special order or purchased for
20 lease, certified by the purchaser to be used primarily for
21 graphic arts production.
22 (6) Personal property sold by a teacher-sponsored
23 student organization affiliated with an elementary or
24 secondary school located in Illinois.
25 (7) Farm machinery and equipment sold for more than $250
26 , both new and used, including that manufactured on special
27 order, certified by the purchaser to be used primarily for
28 production agriculture or State or federal agricultural
29 programs, including individual replacement parts for the
30 machinery and equipment, including machinery and equipment
31 purchased for lease, and including implements of husbandry
32 defined in Section 1-130 of the Illinois Vehicle Code, farm
33 machinery and agricultural chemical and fertilizer spreaders,
34 and nurse wagons required to be registered under Section
-15- LRB9103467PTpk
1 3-809 of the Illinois Vehicle Code, but excluding other motor
2 vehicles required to be registered under the Illinois Vehicle
3 Code. Horticultural polyhouses or hoop houses used for
4 propagating, growing, or overwintering plants shall be
5 considered farm machinery and equipment under this item (7).
6 Agricultural chemical tender tanks and dry boxes shall
7 include units sold separately from a motor vehicle required
8 to be licensed and units sold mounted on a motor vehicle
9 required to be licensed if the selling price of the tender is
10 separately stated.
11 Farm machinery and equipment shall include precision
12 farming equipment that is installed or purchased to be
13 installed on farm machinery and equipment including, but not
14 limited to, tractors, harvesters, sprayers, planters,
15 seeders, or spreaders. Precision farming equipment includes,
16 but is not limited to, soil testing sensors, computers,
17 monitors, software, global positioning and mapping systems,
18 and other such equipment.
19 Farm machinery and equipment also includes computers,
20 sensors, software, and related equipment used primarily in
21 the computer-assisted operation of production agriculture
22 facilities, equipment, and activities such as, but not
23 limited to, the collection, monitoring, and correlation of
24 animal and crop data for the purpose of formulating animal
25 diets and agricultural chemicals. This item (7) is exempt
26 from the provisions of Section 3-55 3-75.
27 (8) Fuel and petroleum products sold to or used by an
28 air common carrier, certified by the carrier to be used for
29 consumption, shipment, or storage in the conduct of its
30 business as an air common carrier, for a flight destined for
31 or returning from a location or locations outside the United
32 States without regard to previous or subsequent domestic
33 stopovers.
34 (9) Proceeds of mandatory service charges separately
-16- LRB9103467PTpk
1 stated on customers' bills for the purchase and consumption
2 of food and beverages, to the extent that the proceeds of the
3 service charge are in fact turned over as tips or as a
4 substitute for tips to the employees who participate directly
5 in preparing, serving, hosting or cleaning up the food or
6 beverage function with respect to which the service charge is
7 imposed.
8 (10) Oil field exploration, drilling, and production
9 equipment, including (i) rigs and parts of rigs, rotary rigs,
10 cable tool rigs, and workover rigs, (ii) pipe and tubular
11 goods, including casing and drill strings, (iii) pumps and
12 pump-jack units, (iv) storage tanks and flow lines, (v) any
13 individual replacement part for oil field exploration,
14 drilling, and production equipment, and (vi) machinery and
15 equipment purchased for lease; but excluding motor vehicles
16 required to be registered under the Illinois Vehicle Code.
17 (11) Photoprocessing machinery and equipment, including
18 repair and replacement parts, both new and used, including
19 that manufactured on special order, certified by the
20 purchaser to be used primarily for photoprocessing, and
21 including photoprocessing machinery and equipment purchased
22 for lease.
23 (12) Coal exploration, mining, offhighway hauling,
24 processing, maintenance, and reclamation equipment, including
25 replacement parts and equipment, and including equipment
26 purchased for lease, but excluding motor vehicles required to
27 be registered under the Illinois Vehicle Code.
28 (13) Food for human consumption that is to be consumed
29 off the premises where it is sold (other than alcoholic
30 beverages, soft drinks and food that has been prepared for
31 immediate consumption) and prescription and non-prescription
32 medicines, drugs, medical appliances, and insulin, urine
33 testing materials, syringes, and needles used by diabetics,
34 for human use, when purchased for use by a person receiving
-17- LRB9103467PTpk
1 medical assistance under Article 5 of the Illinois Public Aid
2 Code who resides in a licensed long-term care facility, as
3 defined in the Nursing Home Care Act.
4 (14) Semen used for artificial insemination of livestock
5 for direct agricultural production.
6 (15) Horses, or interests in horses, registered with and
7 meeting the requirements of any of the Arabian Horse Club
8 Registry of America, Appaloosa Horse Club, American Quarter
9 Horse Association, United States Trotting Association, or
10 Jockey Club, as appropriate, used for purposes of breeding or
11 racing for prizes.
12 (16) Computers and communications equipment utilized for
13 any hospital purpose and equipment used in the diagnosis,
14 analysis, or treatment of hospital patients sold to a lessor
15 who leases the equipment, under a lease of one year or longer
16 executed or in effect at the time of the purchase, to a
17 hospital that has been issued an active tax exemption
18 identification number by the Department under Section 1g of
19 the Retailers' Occupation Tax Act.
20 (17) Personal property sold to a lessor who leases the
21 property, under a lease of one year or longer executed or in
22 effect at the time of the purchase, to a governmental body
23 that has been issued an active tax exemption identification
24 number by the Department under Section 1g of the Retailers'
25 Occupation Tax Act.
26 (18) Beginning with taxable years ending on or after
27 December 31, 1995 and ending with taxable years ending on or
28 before December 31, 2004, personal property that is donated
29 for disaster relief to be used in a State or federally
30 declared disaster area in Illinois or bordering Illinois by a
31 manufacturer or retailer that is registered in this State to
32 a corporation, society, association, foundation, or
33 institution that has been issued a sales tax exemption
34 identification number by the Department that assists victims
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1 of the disaster who reside within the declared disaster area.
2 (19) Beginning with taxable years ending on or after
3 December 31, 1995 and ending with taxable years ending on or
4 before December 31, 2004, personal property that is used in
5 the performance of infrastructure repairs in this State,
6 including but not limited to municipal roads and streets,
7 access roads, bridges, sidewalks, waste disposal systems,
8 water and sewer line extensions, water distribution and
9 purification facilities, storm water drainage and retention
10 facilities, and sewage treatment facilities, resulting from a
11 State or federally declared disaster in Illinois or bordering
12 Illinois when such repairs are initiated on facilities
13 located in the declared disaster area within 6 months after
14 the disaster.
15 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
16 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
17 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
18 eff. 12-12-97; 90-605, eff. 6-30-98; revised 2-10-99.)
19 Section 20. The Retailers' Occupation Tax Act is amended
20 by changing Section 2-5 as follows:
21 (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
22 Sec. 2-5. Exemptions. Gross receipts from proceeds from
23 the sale of the following tangible personal property are
24 exempt from the tax imposed by this Act:
25 (1) Farm chemicals.
26 (2) Farm machinery and equipment sold for more than $250
27 , both new and used, including that manufactured on special
28 order, certified by the purchaser to be used primarily for
29 production agriculture or State or federal agricultural
30 programs, including individual replacement parts for the
31 machinery and equipment, including machinery and equipment
32 purchased for lease, and including implements of husbandry
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1 defined in Section 1-130 of the Illinois Vehicle Code, farm
2 machinery and agricultural chemical and fertilizer spreaders,
3 and nurse wagons required to be registered under Section
4 3-809 of the Illinois Vehicle Code, but excluding other motor
5 vehicles required to be registered under the Illinois Vehicle
6 Code. Horticultural polyhouses or hoop houses used for
7 propagating, growing, or overwintering plants shall be
8 considered farm machinery and equipment under this item (2).
9 Agricultural chemical tender tanks and dry boxes shall
10 include units sold separately from a motor vehicle required
11 to be licensed and units sold mounted on a motor vehicle
12 required to be licensed, if the selling price of the tender
13 is separately stated.
14 Farm machinery and equipment shall include precision
15 farming equipment that is installed or purchased to be
16 installed on farm machinery and equipment including, but not
17 limited to, tractors, harvesters, sprayers, planters,
18 seeders, or spreaders. Precision farming equipment includes,
19 but is not limited to, soil testing sensors, computers,
20 monitors, software, global positioning and mapping systems,
21 and other such equipment.
22 Farm machinery and equipment also includes computers,
23 sensors, software, and related equipment used primarily in
24 the computer-assisted operation of production agriculture
25 facilities, equipment, and activities such as, but not
26 limited to, the collection, monitoring, and correlation of
27 animal and crop data for the purpose of formulating animal
28 diets and agricultural chemicals. This item (7) is exempt
29 from the provisions of Section 2-70 3-75.
30 (3) Distillation machinery and equipment, sold as a unit
31 or kit, assembled or installed by the retailer, certified by
32 the user to be used only for the production of ethyl alcohol
33 that will be used for consumption as motor fuel or as a
34 component of motor fuel for the personal use of the user, and
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1 not subject to sale or resale.
2 (4) Graphic arts machinery and equipment, including
3 repair and replacement parts, both new and used, and
4 including that manufactured on special order or purchased for
5 lease, certified by the purchaser to be used primarily for
6 graphic arts production.
7 (5) A motor vehicle of the first division, a motor
8 vehicle of the second division that is a self-contained motor
9 vehicle designed or permanently converted to provide living
10 quarters for recreational, camping, or travel use, with
11 direct walk through access to the living quarters from the
12 driver's seat, or a motor vehicle of the second division that
13 is of the van configuration designed for the transportation
14 of not less than 7 nor more than 16 passengers, as defined in
15 Section 1-146 of the Illinois Vehicle Code, that is used for
16 automobile renting, as defined in the Automobile Renting
17 Occupation and Use Tax Act.
18 (6) Personal property sold by a teacher-sponsored
19 student organization affiliated with an elementary or
20 secondary school located in Illinois.
21 (7) Proceeds of that portion of the selling price of a
22 passenger car the sale of which is subject to the Replacement
23 Vehicle Tax.
24 (8) Personal property sold to an Illinois county fair
25 association for use in conducting, operating, or promoting
26 the county fair.
27 (9) Personal property sold to a not-for-profit music or
28 dramatic arts organization that establishes, by proof
29 required by the Department by rule, that it has received an
30 exemption under Section 501(c) (3) of the Internal Revenue
31 Code and that is organized and operated for the presentation
32 of live public performances of musical or theatrical works on
33 a regular basis.
34 (10) Personal property sold by a corporation, society,
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1 association, foundation, institution, or organization, other
2 than a limited liability company, that is organized and
3 operated as a not-for-profit service enterprise for the
4 benefit of persons 65 years of age or older if the personal
5 property was not purchased by the enterprise for the purpose
6 of resale by the enterprise.
7 (11) Personal property sold to a governmental body, to a
8 corporation, society, association, foundation, or institution
9 organized and operated exclusively for charitable, religious,
10 or educational purposes, or to a not-for-profit corporation,
11 society, association, foundation, institution, or
12 organization that has no compensated officers or employees
13 and that is organized and operated primarily for the
14 recreation of persons 55 years of age or older. A limited
15 liability company may qualify for the exemption under this
16 paragraph only if the limited liability company is organized
17 and operated exclusively for educational purposes. On and
18 after July 1, 1987, however, no entity otherwise eligible for
19 this exemption shall make tax-free purchases unless it has an
20 active identification number issued by the Department.
21 (12) Personal property sold to interstate carriers for
22 hire for use as rolling stock moving in interstate commerce
23 or to lessors under leases of one year or longer executed or
24 in effect at the time of purchase by interstate carriers for
25 hire for use as rolling stock moving in interstate commerce
26 and equipment operated by a telecommunications provider,
27 licensed as a common carrier by the Federal Communications
28 Commission, which is permanently installed in or affixed to
29 aircraft moving in interstate commerce.
30 (13) Proceeds from sales to owners, lessors, or shippers
31 of tangible personal property that is utilized by interstate
32 carriers for hire for use as rolling stock moving in
33 interstate commerce and equipment operated by a
34 telecommunications provider, licensed as a common carrier by
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1 the Federal Communications Commission, which is permanently
2 installed in or affixed to aircraft moving in interstate
3 commerce.
4 (14) Machinery and equipment that will be used by the
5 purchaser, or a lessee of the purchaser, primarily in the
6 process of manufacturing or assembling tangible personal
7 property for wholesale or retail sale or lease, whether the
8 sale or lease is made directly by the manufacturer or by some
9 other person, whether the materials used in the process are
10 owned by the manufacturer or some other person, or whether
11 the sale or lease is made apart from or as an incident to the
12 seller's engaging in the service occupation of producing
13 machines, tools, dies, jigs, patterns, gauges, or other
14 similar items of no commercial value on special order for a
15 particular purchaser.
16 (15) Proceeds of mandatory service charges separately
17 stated on customers' bills for purchase and consumption of
18 food and beverages, to the extent that the proceeds of the
19 service charge are in fact turned over as tips or as a
20 substitute for tips to the employees who participate directly
21 in preparing, serving, hosting or cleaning up the food or
22 beverage function with respect to which the service charge is
23 imposed.
24 (16) Petroleum products sold to a purchaser if the
25 seller is prohibited by federal law from charging tax to the
26 purchaser.
27 (17) Tangible personal property sold to a common carrier
28 by rail or motor that receives the physical possession of the
29 property in Illinois and that transports the property, or
30 shares with another common carrier in the transportation of
31 the property, out of Illinois on a standard uniform bill of
32 lading showing the seller of the property as the shipper or
33 consignor of the property to a destination outside Illinois,
34 for use outside Illinois.
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1 (18) Legal tender, currency, medallions, or gold or
2 silver coinage issued by the State of Illinois, the
3 government of the United States of America, or the government
4 of any foreign country, and bullion.
5 (19) Oil field exploration, drilling, and production
6 equipment, including (i) rigs and parts of rigs, rotary rigs,
7 cable tool rigs, and workover rigs, (ii) pipe and tubular
8 goods, including casing and drill strings, (iii) pumps and
9 pump-jack units, (iv) storage tanks and flow lines, (v) any
10 individual replacement part for oil field exploration,
11 drilling, and production equipment, and (vi) machinery and
12 equipment purchased for lease; but excluding motor vehicles
13 required to be registered under the Illinois Vehicle Code.
14 (20) Photoprocessing machinery and equipment, including
15 repair and replacement parts, both new and used, including
16 that manufactured on special order, certified by the
17 purchaser to be used primarily for photoprocessing, and
18 including photoprocessing machinery and equipment purchased
19 for lease.
20 (21) Coal exploration, mining, offhighway hauling,
21 processing, maintenance, and reclamation equipment, including
22 replacement parts and equipment, and including equipment
23 purchased for lease, but excluding motor vehicles required to
24 be registered under the Illinois Vehicle Code.
25 (22) Fuel and petroleum products sold to or used by an
26 air carrier, certified by the carrier to be used for
27 consumption, shipment, or storage in the conduct of its
28 business as an air common carrier, for a flight destined for
29 or returning from a location or locations outside the United
30 States without regard to previous or subsequent domestic
31 stopovers.
32 (23) A transaction in which the purchase order is
33 received by a florist who is located outside Illinois, but
34 who has a florist located in Illinois deliver the property to
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1 the purchaser or the purchaser's donee in Illinois.
2 (24) Fuel consumed or used in the operation of ships,
3 barges, or vessels that are used primarily in or for the
4 transportation of property or the conveyance of persons for
5 hire on rivers bordering on this State if the fuel is
6 delivered by the seller to the purchaser's barge, ship, or
7 vessel while it is afloat upon that bordering river.
8 (25) A motor vehicle sold in this State to a nonresident
9 even though the motor vehicle is delivered to the nonresident
10 in this State, if the motor vehicle is not to be titled in
11 this State, and if a driveaway decal permit is issued to the
12 motor vehicle as provided in Section 3-603 of the Illinois
13 Vehicle Code or if the nonresident purchaser has vehicle
14 registration plates to transfer to the motor vehicle upon
15 returning to his or her home state. The issuance of the
16 driveaway decal permit or having the out-of-state
17 registration plates to be transferred is prima facie evidence
18 that the motor vehicle will not be titled in this State.
19 (26) Semen used for artificial insemination of livestock
20 for direct agricultural production.
21 (27) Horses, or interests in horses, registered with and
22 meeting the requirements of any of the Arabian Horse Club
23 Registry of America, Appaloosa Horse Club, American Quarter
24 Horse Association, United States Trotting Association, or
25 Jockey Club, as appropriate, used for purposes of breeding or
26 racing for prizes.
27 (28) Computers and communications equipment utilized for
28 any hospital purpose and equipment used in the diagnosis,
29 analysis, or treatment of hospital patients sold to a lessor
30 who leases the equipment, under a lease of one year or longer
31 executed or in effect at the time of the purchase, to a
32 hospital that has been issued an active tax exemption
33 identification number by the Department under Section 1g of
34 this Act.
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1 (29) Personal property sold to a lessor who leases the
2 property, under a lease of one year or longer executed or in
3 effect at the time of the purchase, to a governmental body
4 that has been issued an active tax exemption identification
5 number by the Department under Section 1g of this Act.
6 (30) Beginning with taxable years ending on or after
7 December 31, 1995 and ending with taxable years ending on or
8 before December 31, 2004, personal property that is donated
9 for disaster relief to be used in a State or federally
10 declared disaster area in Illinois or bordering Illinois by a
11 manufacturer or retailer that is registered in this State to
12 a corporation, society, association, foundation, or
13 institution that has been issued a sales tax exemption
14 identification number by the Department that assists victims
15 of the disaster who reside within the declared disaster area.
16 (31) Beginning with taxable years ending on or after
17 December 31, 1995 and ending with taxable years ending on or
18 before December 31, 2004, personal property that is used in
19 the performance of infrastructure repairs in this State,
20 including but not limited to municipal roads and streets,
21 access roads, bridges, sidewalks, waste disposal systems,
22 water and sewer line extensions, water distribution and
23 purification facilities, storm water drainage and retention
24 facilities, and sewage treatment facilities, resulting from a
25 State or federally declared disaster in Illinois or bordering
26 Illinois when such repairs are initiated on facilities
27 located in the declared disaster area within 6 months after
28 the disaster.
29 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
30 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
31 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-519,
32 eff. 6-1-98; 90-552, eff. 12-12-97; 90-605, eff. 6-30-98;
33 revised 2-10-99.)
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1 Section 99. Effective date. This Act takes effect
2 January 1, 2000.