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91_HB0542sam001
LRB9101956PTpkam01
1 AMENDMENT TO HOUSE BILL 542
2 AMENDMENT NO. . Amend House Bill 542 by replacing
3 everything after the enacting clause with the following:
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
-2- LRB9101956PTpkam01
1 Revenue Code and that is organized and operated for the
2 presentation of live public performances of musical or
3 theatrical works on a regular basis.
4 (4) Personal property purchased by a governmental body,
5 by a corporation, society, association, foundation, or
6 institution organized and operated exclusively for
7 charitable, religious, or educational purposes, or by a
8 not-for-profit corporation, society, association, foundation,
9 institution, or organization that has no compensated officers
10 or employees and that is organized and operated primarily for
11 the recreation of persons 55 years of age or older. A limited
12 liability company may qualify for the exemption under this
13 paragraph only if the limited liability company is organized
14 and operated exclusively for educational purposes. On and
15 after July 1, 1987, however, no entity otherwise eligible for
16 this exemption shall make tax-free purchases unless it has an
17 active exemption identification number issued by the
18 Department.
19 (5) A passenger car that is a replacement vehicle to the
20 extent that the purchase price of the car is subject to the
21 Replacement Vehicle Tax.
22 (6) Graphic arts machinery and equipment, including
23 repair and replacement parts, both new and used, and
24 including that manufactured on special order, certified by
25 the purchaser to be used primarily for graphic arts
26 production, and including machinery and equipment purchased
27 for lease.
28 (7) Farm chemicals.
29 (8) Legal tender, currency, medallions, or gold or
30 silver coinage issued by the State of Illinois, the
31 government of the United States of America, or the government
32 of any foreign country, and bullion.
33 (9) Personal property purchased from a teacher-sponsored
34 student organization affiliated with an elementary or
-3- LRB9101956PTpkam01
1 secondary school located in Illinois.
2 (10) A motor vehicle of the first division, a motor
3 vehicle of the second division that is a self-contained motor
4 vehicle designed or permanently converted to provide living
5 quarters for recreational, camping, or travel use, with
6 direct walk through to the living quarters from the driver's
7 seat, or a motor vehicle of the second division that is of
8 the van configuration designed for the transportation of not
9 less than 7 nor more than 16 passengers, as defined in
10 Section 1-146 of the Illinois Vehicle Code, that is used for
11 automobile renting, as defined in the Automobile Renting
12 Occupation and Use Tax Act.
13 (11) Farm machinery and equipment, both new and used,
14 including that manufactured on special order, certified by
15 the purchaser to be used primarily for production agriculture
16 or State or federal agricultural programs, including
17 individual replacement parts for the machinery and equipment,
18 including machinery and equipment purchased for lease, and
19 including implements of husbandry defined in Section 1-130 of
20 the Illinois Vehicle Code, farm machinery and agricultural
21 chemical and fertilizer spreaders, and nurse wagons required
22 to be registered under Section 3-809 of the Illinois Vehicle
23 Code, but excluding other motor vehicles required to be
24 registered under the Illinois Vehicle Code. Horticultural
25 polyhouses or hoop houses used for propagating, growing, or
26 overwintering plants shall be considered farm machinery and
27 equipment under this item (11). Agricultural chemical tender
28 tanks and dry boxes shall include units sold separately from
29 a motor vehicle required to be licensed and units sold
30 mounted on a motor vehicle required to be licensed if the
31 selling price of the tender is separately stated.
32 Farm machinery and equipment shall include precision
33 farming equipment that is installed or purchased to be
34 installed on farm machinery and equipment including, but not
-4- LRB9101956PTpkam01
1 limited to, tractors, harvesters, sprayers, planters,
2 seeders, or spreaders. Precision farming equipment includes,
3 but is not limited to, soil testing sensors, computers,
4 monitors, software, global positioning and mapping systems,
5 and other such equipment.
6 Farm machinery and equipment also includes computers,
7 sensors, software, and related equipment used primarily in
8 the computer-assisted operation of production agriculture
9 facilities, equipment, and activities such as, but not
10 limited to, the collection, monitoring, and correlation of
11 animal and crop data for the purpose of formulating animal
12 diets and agricultural chemicals. This item (11) is exempt
13 from the provisions of Section 3-90.
14 (12) Fuel and petroleum products sold to or used by an
15 air common carrier, certified by the carrier to be used for
16 consumption, shipment, or storage in the conduct of its
17 business as an air common carrier, for a flight destined for
18 or returning from a location or locations outside the United
19 States without regard to previous or subsequent domestic
20 stopovers.
21 (13) Proceeds of mandatory service charges separately
22 stated on customers' bills for the purchase and consumption
23 of food and beverages purchased at retail from a retailer, to
24 the extent that the proceeds of the service charge are in
25 fact turned over as tips or as a substitute for tips to the
26 employees who participate directly in preparing, serving,
27 hosting or cleaning up the food or beverage function with
28 respect to which the service charge is imposed.
29 (14) Oil field exploration, drilling, and production
30 equipment, including (i) rigs and parts of rigs, rotary rigs,
31 cable tool rigs, and workover rigs, (ii) pipe and tubular
32 goods, including casing and drill strings, (iii) pumps and
33 pump-jack units, (iv) storage tanks and flow lines, (v) any
34 individual replacement part for oil field exploration,
-5- LRB9101956PTpkam01
1 drilling, and production equipment, and (vi) machinery and
2 equipment purchased for lease; but excluding motor vehicles
3 required to be registered under the Illinois Vehicle Code.
4 (15) Photoprocessing machinery and equipment, including
5 repair and replacement parts, both new and used, including
6 that manufactured on special order, certified by the
7 purchaser to be used primarily for photoprocessing, and
8 including photoprocessing machinery and equipment purchased
9 for lease.
10 (16) Coal exploration, mining, offhighway hauling,
11 processing, maintenance, and reclamation equipment, including
12 replacement parts and equipment, and including equipment
13 purchased for lease, but excluding motor vehicles required to
14 be registered under the Illinois Vehicle Code.
15 (17) Distillation machinery and equipment, sold as a
16 unit or kit, assembled or installed by the retailer,
17 certified by the user to be used only for the production of
18 ethyl alcohol that will be used for consumption as motor fuel
19 or as a component of motor fuel for the personal use of the
20 user, and not subject to sale or resale.
21 (18) Manufacturing and assembling machinery and
22 equipment used primarily in the process of manufacturing or
23 assembling tangible personal property for wholesale or retail
24 sale or lease, whether that sale or lease is made directly by
25 the manufacturer or by some other person, whether the
26 materials used in the process are owned by the manufacturer
27 or some other person, or whether that sale or lease is made
28 apart from or as an incident to the seller's engaging in the
29 service occupation of producing machines, tools, dies, jigs,
30 patterns, gauges, or other similar items of no commercial
31 value on special order for a particular purchaser.
32 (19) Personal property delivered to a purchaser or
33 purchaser's donee inside Illinois when the purchase order for
34 that personal property was received by a florist located
-6- LRB9101956PTpkam01
1 outside Illinois who has a florist located inside Illinois
2 deliver the personal property.
3 (20) Semen used for artificial insemination of livestock
4 for direct agricultural production.
5 (21) Horses, or interests in horses, registered with and
6 meeting the requirements of any of the Arabian Horse Club
7 Registry of America, Appaloosa Horse Club, American Quarter
8 Horse Association, United States Trotting Association, or
9 Jockey Club, as appropriate, used for purposes of breeding or
10 racing for prizes.
11 (22) Computers and communications equipment utilized for
12 any hospital purpose and equipment used in the diagnosis,
13 analysis, or treatment of hospital patients purchased by a
14 lessor who leases the equipment, under a lease of one year or
15 longer executed or in effect at the time the lessor would
16 otherwise be subject to the tax imposed by this Act, 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. If the equipment is
20 leased in a manner that does not qualify for this exemption
21 or is used in any other non-exempt manner, the lessor shall
22 be liable for the tax imposed under this Act or the Service
23 Use Tax Act, as the case may be, based on the fair market
24 value of the property at the time the non-qualifying use
25 occurs. No lessor shall collect or attempt to collect an
26 amount (however designated) that purports to reimburse that
27 lessor for the tax imposed by this Act or the Service Use Tax
28 Act, as the case may be, if the tax has not been paid by the
29 lessor. If a lessor improperly collects any such amount from
30 the lessee, the lessee shall have a legal right to claim a
31 refund of that amount from the lessor. If, however, that
32 amount is not refunded to the lessee for any reason, the
33 lessor is liable to pay that amount to the Department.
34 (23) Personal property purchased by a lessor who leases
-7- LRB9101956PTpkam01
1 the property, under a lease of one year or longer executed
2 or in effect at the time the lessor would otherwise be
3 subject to the tax imposed by this Act, to a governmental
4 body that has been issued an active sales tax exemption
5 identification number by the Department under Section 1g of
6 the Retailers' Occupation Tax Act. If the property is leased
7 in a manner that does not qualify for this exemption or used
8 in any other non-exempt manner, the lessor shall be liable
9 for the tax imposed under this Act or the Service Use Tax
10 Act, as the case may be, based on the fair market value of
11 the property at the time the non-qualifying use occurs. No
12 lessor shall collect or attempt to collect an amount (however
13 designated) that purports to reimburse that lessor for the
14 tax imposed by this Act or the Service Use Tax Act, as the
15 case may be, if the tax has not been paid by the lessor. If
16 a lessor improperly collects any such amount from the lessee,
17 the lessee shall have a legal right to claim a refund of that
18 amount from the lessor. If, however, that amount is not
19 refunded to the lessee for any reason, the lessor is liable
20 to pay that amount to the Department.
21 (24) Beginning with taxable years ending on or after
22 December 31, 1995 and ending with taxable years ending on or
23 before December 31, 2004, personal property that is donated
24 for disaster relief to be used in a State or federally
25 declared disaster area in Illinois or bordering Illinois by a
26 manufacturer or retailer that is registered in this State to
27 a corporation, society, association, foundation, or
28 institution that has been issued a sales tax exemption
29 identification number by the Department that assists victims
30 of the disaster who reside within the declared disaster area.
31 (25) Beginning with taxable years ending on or after
32 December 31, 1995 and ending with taxable years ending on or
33 before December 31, 2004, personal property that is used in
34 the performance of infrastructure repairs in this State,
-8- LRB9101956PTpkam01
1 including but not limited to municipal roads and streets,
2 access roads, bridges, sidewalks, waste disposal systems,
3 water and sewer line extensions, water distribution and
4 purification facilities, storm water drainage and retention
5 facilities, and sewage treatment facilities, resulting from a
6 State or federally declared disaster in Illinois or bordering
7 Illinois when such repairs are initiated on facilities
8 located in the declared disaster area within 6 months after
9 the disaster.
10 (26) A motor vehicle, as that term is defined in Section
11 1-146 of the Illinois Vehicle Code, that is donated to a
12 corporation, limited liability company, society, association,
13 foundation, or institution that is determined by the
14 Department to be organized and operated exclusively for
15 educational purposes. For purposes of this exemption, "a
16 corporation, limited liability company, society, association,
17 foundation, or institution organized and operated exclusively
18 for educational purposes" means all tax-supported public
19 schools, private schools that offer systematic instruction in
20 useful branches of learning by methods common to public
21 schools and that compare favorably in their scope and
22 intensity with the course of study presented in tax-supported
23 schools, and vocational or technical schools or institutes
24 organized and operated exclusively to provide a course of
25 study of not less than 6 weeks duration and designed to
26 prepare individuals to follow a trade or to pursue a manual,
27 technical, mechanical, industrial, business, or commercial
28 occupation.
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; 90-552,
32 eff. 12-12-97; 90-605, eff. 6-30-98.)
33 Section 10. The Service Use Tax Act is amended by
-9- LRB9101956PTpkam01
1 changing Section 3-5 as follows:
2 (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
3 Sec. 3-5. Exemptions. Use of the following tangible
4 personal property is exempt from the tax imposed by this Act:
5 (1) Personal property purchased from a corporation,
6 society, association, foundation, institution, or
7 organization, other than a limited liability company, that is
8 organized and operated as a not-for-profit service enterprise
9 for the benefit of persons 65 years of age or older if the
10 personal property was not purchased by the enterprise for the
11 purpose of resale by the enterprise.
12 (2) Personal property purchased by a non-profit Illinois
13 county fair association for use in conducting, operating, or
14 promoting the county fair.
15 (3) Personal property purchased by a not-for-profit
16 music or dramatic arts organization that establishes, by
17 proof required by the Department by rule, that it has
18 received an exemption under Section 501(c)(3) of the Internal
19 Revenue Code and that is organized and operated for the
20 presentation of live public performances of musical or
21 theatrical works on a regular basis.
22 (4) Legal tender, currency, medallions, or gold or
23 silver coinage issued by the State of Illinois, the
24 government of the United States of America, or the government
25 of any foreign country, and bullion.
26 (5) Graphic arts machinery and equipment, including
27 repair and replacement parts, both new and used, and
28 including that manufactured on special order or purchased for
29 lease, certified by the purchaser to be used primarily for
30 graphic arts production.
31 (6) Personal property purchased from a teacher-sponsored
32 student organization affiliated with an elementary or
33 secondary school located in Illinois.
-10- LRB9101956PTpkam01
1 (7) Farm machinery and equipment, both new and used,
2 including that manufactured on special order, certified by
3 the purchaser to be used primarily for production agriculture
4 or State or federal agricultural programs, including
5 individual replacement parts for the machinery and equipment,
6 including machinery and equipment purchased for lease, and
7 including implements of husbandry defined in Section 1-130 of
8 the Illinois Vehicle Code, farm machinery and agricultural
9 chemical and fertilizer spreaders, and nurse wagons required
10 to be registered under Section 3-809 of the Illinois Vehicle
11 Code, but excluding other motor vehicles required to be
12 registered under the Illinois Vehicle Code. Horticultural
13 polyhouses or hoop houses used for propagating, growing, or
14 overwintering plants shall be considered farm machinery and
15 equipment under this item (7). Agricultural chemical tender
16 tanks and dry boxes shall include units sold separately from
17 a motor vehicle required to be licensed and units sold
18 mounted on a motor vehicle required to be licensed if the
19 selling price of the tender is separately stated.
20 Farm machinery and equipment shall include precision
21 farming equipment that is installed or purchased to be
22 installed on farm machinery and equipment including, but not
23 limited to, tractors, harvesters, sprayers, planters,
24 seeders, or spreaders. Precision farming equipment includes,
25 but is not limited to, soil testing sensors, computers,
26 monitors, software, global positioning and mapping systems,
27 and other such equipment.
28 Farm machinery and equipment also includes computers,
29 sensors, software, and related equipment used primarily in
30 the computer-assisted operation of production agriculture
31 facilities, equipment, and activities such as, but not
32 limited to, the collection, monitoring, and correlation of
33 animal and crop data for the purpose of formulating animal
34 diets and agricultural chemicals. This item (7) is exempt
-11- LRB9101956PTpkam01
1 from the provisions of Section 3-75.
2 (8) Fuel and petroleum products sold to or used by an
3 air common carrier, certified by the carrier to be used for
4 consumption, shipment, or storage in the conduct of its
5 business as an air common carrier, for a flight destined for
6 or returning from a location or locations outside the United
7 States without regard to previous or subsequent domestic
8 stopovers.
9 (9) Proceeds of mandatory service charges separately
10 stated on customers' bills for the purchase and consumption
11 of food and beverages acquired as an incident to the purchase
12 of a service from a serviceman, to the extent that the
13 proceeds of the service charge are in fact turned over as
14 tips or as a substitute for tips to the employees who
15 participate directly in preparing, serving, hosting or
16 cleaning up the food or beverage function with respect to
17 which the service charge is imposed.
18 (10) Oil field exploration, drilling, and production
19 equipment, including (i) rigs and parts of rigs, rotary rigs,
20 cable tool rigs, and workover rigs, (ii) pipe and tubular
21 goods, including casing and drill strings, (iii) pumps and
22 pump-jack units, (iv) storage tanks and flow lines, (v) any
23 individual replacement part for oil field exploration,
24 drilling, and production equipment, and (vi) machinery and
25 equipment purchased for lease; but excluding motor vehicles
26 required to be registered under the Illinois Vehicle Code.
27 (11) Proceeds from the sale of photoprocessing machinery
28 and equipment, including repair and replacement parts, both
29 new and used, including that manufactured on special order,
30 certified by the purchaser to be used primarily for
31 photoprocessing, and including photoprocessing machinery and
32 equipment purchased for lease.
33 (12) Coal exploration, mining, offhighway hauling,
34 processing, maintenance, and reclamation equipment, including
-12- LRB9101956PTpkam01
1 replacement parts and equipment, and including equipment
2 purchased for lease, but excluding motor vehicles required to
3 be registered under the Illinois Vehicle Code.
4 (13) Semen used for artificial insemination of livestock
5 for direct agricultural production.
6 (14) 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 (15) Computers and communications equipment utilized for
13 any hospital purpose and equipment used in the diagnosis,
14 analysis, or treatment of hospital patients purchased by a
15 lessor who leases the equipment, under a lease of one year or
16 longer executed or in effect at the time the lessor would
17 otherwise be subject to the tax imposed by this Act, to a
18 hospital that has been issued an active tax exemption
19 identification number by the Department under Section 1g of
20 the Retailers' Occupation Tax Act. If the equipment is leased
21 in a manner that does not qualify for this exemption or is
22 used in any other non-exempt manner, the lessor shall be
23 liable for the tax imposed under this Act or the Use Tax Act,
24 as the case may be, based on the fair market value of the
25 property at the time the non-qualifying use occurs. No
26 lessor shall collect or attempt to collect an amount (however
27 designated) that purports to reimburse that lessor for the
28 tax imposed by this Act or the Use Tax Act, as the case may
29 be, if the tax has not been paid by the lessor. If a lessor
30 improperly collects any such amount from the lessee, the
31 lessee shall have a legal right to claim a refund of that
32 amount from the lessor. If, however, that amount is not
33 refunded to the lessee for any reason, the lessor is liable
34 to pay that amount to the Department.
-13- LRB9101956PTpkam01
1 (16) Personal property purchased by a lessor who leases
2 the property, under a lease of one year or longer executed or
3 in effect at the time the lessor would otherwise be subject
4 to the tax imposed by this Act, to a governmental body that
5 has been issued an active tax exemption identification number
6 by the Department under Section 1g of the Retailers'
7 Occupation Tax Act. If the property is leased in a manner
8 that does not qualify for this exemption or is used in any
9 other non-exempt manner, the lessor shall be liable for the
10 tax imposed under this Act or the Use Tax Act, as the case
11 may be, based on the fair market value of the property at the
12 time the non-qualifying use occurs. No lessor shall collect
13 or attempt to collect an amount (however designated) that
14 purports to reimburse that lessor for the tax imposed by this
15 Act or the Use Tax Act, as the case may be, if the tax has
16 not been paid by the lessor. If a lessor improperly collects
17 any such amount from the lessee, the lessee shall have a
18 legal right to claim a refund of that amount from the lessor.
19 If, however, that amount is not refunded to the lessee for
20 any reason, the lessor is liable to pay that amount to the
21 Department.
22 (17) Beginning with taxable years ending on or after
23 December 31, 1995 and ending with taxable years ending on or
24 before December 31, 2004, personal property that is donated
25 for disaster relief to be used in a State or federally
26 declared disaster area in Illinois or bordering Illinois by a
27 manufacturer or retailer that is registered in this State to
28 a corporation, society, association, foundation, or
29 institution that has been issued a sales tax exemption
30 identification number by the Department that assists victims
31 of the disaster who reside within the declared disaster area.
32 (18) Beginning with taxable years ending on or after
33 December 31, 1995 and ending with taxable years ending on or
34 before December 31, 2004, personal property that is used in
-14- LRB9101956PTpkam01
1 the performance of infrastructure repairs in this State,
2 including but not limited to municipal roads and streets,
3 access roads, bridges, sidewalks, waste disposal systems,
4 water and sewer line extensions, water distribution and
5 purification facilities, storm water drainage and retention
6 facilities, and sewage treatment facilities, resulting from a
7 State or federally declared disaster in Illinois or bordering
8 Illinois when such repairs are initiated on facilities
9 located in the declared disaster area within 6 months after
10 the disaster.
11 (19) A motor vehicle, as that term is defined in Section
12 1-146 of the Illinois Vehicle Code, that is donated to a
13 corporation, limited liability company, society, association,
14 foundation, or institution that is determined by the
15 Department to be organized and operated exclusively for
16 educational purposes. For purposes of this exemption, "a
17 corporation, limited liability company, society, association,
18 foundation, or institution organized and operated exclusively
19 for educational purposes" means all tax-supported public
20 schools, private schools that offer systematic instruction in
21 useful branches of learning by methods common to public
22 schools and that compare favorably in their scope and
23 intensity with the course of study presented in tax-supported
24 schools, and vocational or technical schools or institutes
25 organized and operated exclusively to provide a course of
26 study of not less than 6 weeks duration and designed to
27 prepare individuals to follow a trade or to pursue a manual,
28 technical, mechanical, industrial, business, or commercial
29 occupation.
30 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
31 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
32 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
33 eff. 12-12-97; 90-605, eff. 6-30-98.)
-15- LRB9101956PTpkam01
1 Section 15. The Service Occupation Tax Act is amended by
2 changing Section 3-5 as follows:
3 (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
4 Sec. 3-5. Exemptions. The following tangible personal
5 property is exempt from the tax imposed by this Act:
6 (1) Personal property sold by a corporation, society,
7 association, foundation, institution, or organization, other
8 than a limited liability company, that is organized and
9 operated as a not-for-profit service enterprise for the
10 benefit of persons 65 years of age or older if the personal
11 property was not purchased by the enterprise for the purpose
12 of resale by the enterprise.
13 (2) Personal property purchased by a not-for-profit
14 Illinois county fair association for use in conducting,
15 operating, or promoting the county fair.
16 (3) Personal property purchased by any not-for-profit
17 music or dramatic arts organization that establishes, by
18 proof required by the Department by rule, that it has
19 received an exemption under Section 501(c)(3) of the
20 Internal Revenue Code and that is organized and operated for
21 the presentation of live public performances of musical or
22 theatrical works on a regular basis.
23 (4) Legal tender, currency, medallions, or gold or
24 silver coinage issued by the State of Illinois, the
25 government of the United States of America, or the government
26 of any foreign country, and bullion.
27 (5) Graphic arts machinery and equipment, including
28 repair and replacement parts, both new and used, and
29 including that manufactured on special order or purchased for
30 lease, certified by the purchaser to be used primarily for
31 graphic arts production.
32 (6) Personal property sold by a teacher-sponsored
33 student organization affiliated with an elementary or
-16- LRB9101956PTpkam01
1 secondary school located in Illinois.
2 (7) Farm machinery and equipment, both new and used,
3 including that manufactured on special order, certified by
4 the purchaser to be used primarily for production agriculture
5 or State or federal agricultural programs, including
6 individual replacement parts for the machinery and equipment,
7 including machinery and equipment purchased for lease, and
8 including implements of husbandry defined in Section 1-130 of
9 the Illinois Vehicle Code, farm machinery and agricultural
10 chemical and fertilizer spreaders, and nurse wagons required
11 to be registered under Section 3-809 of the Illinois Vehicle
12 Code, but excluding other motor vehicles required to be
13 registered under the Illinois Vehicle Code. Horticultural
14 polyhouses or hoop houses used for propagating, growing, or
15 overwintering plants shall be considered farm machinery and
16 equipment under this item (7). Agricultural chemical tender
17 tanks and dry boxes shall include units sold separately from
18 a motor vehicle required to be licensed and units sold
19 mounted on a motor vehicle required to be licensed if the
20 selling price of the tender is separately stated.
21 Farm machinery and equipment shall include precision
22 farming equipment that is installed or purchased to be
23 installed on farm machinery and equipment including, but not
24 limited to, tractors, harvesters, sprayers, planters,
25 seeders, or spreaders. Precision farming equipment includes,
26 but is not limited to, soil testing sensors, computers,
27 monitors, software, global positioning and mapping systems,
28 and other such equipment.
29 Farm machinery and equipment also includes computers,
30 sensors, software, and related equipment used primarily in
31 the computer-assisted operation of production agriculture
32 facilities, equipment, and activities such as, but not
33 limited to, the collection, monitoring, and correlation of
34 animal and crop data for the purpose of formulating animal
-17- LRB9101956PTpkam01
1 diets and agricultural chemicals. This item (7) is exempt
2 from the provisions of Section 3-55 3-75.
3 (8) Fuel and petroleum products sold to or used by an
4 air common carrier, certified by the carrier to be used for
5 consumption, shipment, or storage in the conduct of its
6 business as an air common carrier, for a flight destined for
7 or returning from a location or locations outside the United
8 States without regard to previous or subsequent domestic
9 stopovers.
10 (9) Proceeds of mandatory service charges separately
11 stated on customers' bills for the purchase and consumption
12 of food and beverages, to the extent that the proceeds of the
13 service charge are in fact turned over as tips or as a
14 substitute for tips to the employees who participate directly
15 in preparing, serving, hosting or cleaning up the food or
16 beverage function with respect to which the service charge is
17 imposed.
18 (10) Oil field exploration, drilling, and production
19 equipment, including (i) rigs and parts of rigs, rotary rigs,
20 cable tool rigs, and workover rigs, (ii) pipe and tubular
21 goods, including casing and drill strings, (iii) pumps and
22 pump-jack units, (iv) storage tanks and flow lines, (v) any
23 individual replacement part for oil field exploration,
24 drilling, and production equipment, and (vi) machinery and
25 equipment purchased for lease; but excluding motor vehicles
26 required to be registered under the Illinois Vehicle Code.
27 (11) Photoprocessing machinery and equipment, including
28 repair and replacement parts, both new and used, including
29 that manufactured on special order, certified by the
30 purchaser to be used primarily for photoprocessing, and
31 including photoprocessing machinery and equipment purchased
32 for lease.
33 (12) Coal exploration, mining, offhighway hauling,
34 processing, maintenance, and reclamation equipment, including
-18- LRB9101956PTpkam01
1 replacement parts and equipment, and including equipment
2 purchased for lease, but excluding motor vehicles required to
3 be registered under the Illinois Vehicle Code.
4 (13) Food for human consumption that is to be consumed
5 off the premises where it is sold (other than alcoholic
6 beverages, soft drinks and food that has been prepared for
7 immediate consumption) and prescription and non-prescription
8 medicines, drugs, medical appliances, and insulin, urine
9 testing materials, syringes, and needles used by diabetics,
10 for human use, when purchased for use by a person receiving
11 medical assistance under Article 5 of the Illinois Public Aid
12 Code who resides in a licensed long-term care facility, as
13 defined in the Nursing Home Care Act.
14 (14) Semen used for artificial insemination of livestock
15 for direct agricultural production.
16 (15) Horses, or interests in horses, registered with and
17 meeting the requirements of any of the Arabian Horse Club
18 Registry of America, Appaloosa Horse Club, American Quarter
19 Horse Association, United States Trotting Association, or
20 Jockey Club, as appropriate, used for purposes of breeding or
21 racing for prizes.
22 (16) Computers and communications equipment utilized for
23 any hospital purpose and equipment used in the diagnosis,
24 analysis, or treatment of hospital patients sold to a lessor
25 who leases the equipment, under a lease of one year or longer
26 executed or in effect at the time of the purchase, to a
27 hospital that has been issued an active tax exemption
28 identification number by the Department under Section 1g of
29 the Retailers' Occupation Tax Act.
30 (17) Personal property sold to a lessor who leases the
31 property, under a lease of one year or longer executed or in
32 effect at the time of the purchase, to a governmental body
33 that has been issued an active tax exemption identification
34 number by the Department under Section 1g of the Retailers'
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1 Occupation Tax Act.
2 (18) 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 donated
5 for disaster relief to be used in a State or federally
6 declared disaster area in Illinois or bordering Illinois by a
7 manufacturer or retailer that is registered in this State to
8 a corporation, society, association, foundation, or
9 institution that has been issued a sales tax exemption
10 identification number by the Department that assists victims
11 of the disaster who reside within the declared disaster area.
12 (19) Beginning with taxable years ending on or after
13 December 31, 1995 and ending with taxable years ending on or
14 before December 31, 2004, personal property that is used in
15 the performance of infrastructure repairs in this State,
16 including but not limited to municipal roads and streets,
17 access roads, bridges, sidewalks, waste disposal systems,
18 water and sewer line extensions, water distribution and
19 purification facilities, storm water drainage and retention
20 facilities, and sewage treatment facilities, resulting from a
21 State or federally declared disaster in Illinois or bordering
22 Illinois when such repairs are initiated on facilities
23 located in the declared disaster area within 6 months after
24 the disaster.
25 (20) A motor vehicle, as that term is defined in Section
26 1-146 of the Illinois Vehicle Code, that is donated to a
27 corporation, limited liability company, society, association,
28 foundation, or institution that is determined by the
29 Department to be organized and operated exclusively for
30 educational purposes. For purposes of this exemption, "a
31 corporation, limited liability company, society, association,
32 foundation, or institution organized and operated exclusively
33 for educational purposes" means all tax-supported public
34 schools, private schools that offer systematic instruction in
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1 useful branches of learning by methods common to public
2 schools and that compare favorably in their scope and
3 intensity with the course of study presented in tax-supported
4 schools, and vocational or technical schools or institutes
5 organized and operated exclusively to provide a course of
6 study of not less than 6 weeks duration and designed to
7 prepare individuals to follow a trade or to pursue a manual,
8 technical, mechanical, industrial, business, or commercial
9 occupation.
10 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
11 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
12 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
13 eff. 12-12-97; 90-605, eff. 6-30-98; revised 2-10-99.)
14 Section 20. The Retailers' Occupation Tax Act is amended
15 by changing Section 2-5 as follows:
16 (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
17 Sec. 2-5. Exemptions. Gross receipts from proceeds from
18 the sale of the following tangible personal property are
19 exempt from the tax imposed by this Act:
20 (1) Farm chemicals.
21 (2) Farm machinery and equipment, both new and used,
22 including that manufactured on special order, certified by
23 the purchaser to be used primarily for production agriculture
24 or State or federal agricultural programs, including
25 individual replacement parts for the machinery and equipment,
26 including machinery and equipment purchased for lease, and
27 including implements of husbandry defined in Section 1-130 of
28 the Illinois Vehicle Code, farm machinery and agricultural
29 chemical and fertilizer spreaders, and nurse wagons required
30 to be registered under Section 3-809 of the Illinois Vehicle
31 Code, but excluding other motor vehicles required to be
32 registered under the Illinois Vehicle Code. Horticultural
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1 polyhouses or hoop houses used for propagating, growing, or
2 overwintering plants shall be considered farm machinery and
3 equipment under this item (2). Agricultural chemical tender
4 tanks and dry boxes shall include units sold separately from
5 a motor vehicle required to be licensed and units sold
6 mounted on a motor vehicle required to be licensed, if the
7 selling price of the tender is separately stated.
8 Farm machinery and equipment shall include precision
9 farming equipment that is installed or purchased to be
10 installed on farm machinery and equipment including, but not
11 limited to, tractors, harvesters, sprayers, planters,
12 seeders, or spreaders. Precision farming equipment includes,
13 but is not limited to, soil testing sensors, computers,
14 monitors, software, global positioning and mapping systems,
15 and other such equipment.
16 Farm machinery and equipment also includes computers,
17 sensors, software, and related equipment used primarily in
18 the computer-assisted operation of production agriculture
19 facilities, equipment, and activities such as, but not
20 limited to, the collection, monitoring, and correlation of
21 animal and crop data for the purpose of formulating animal
22 diets and agricultural chemicals. This item (7) is exempt
23 from the provisions of Section 2-70 3-75.
24 (3) Distillation machinery and equipment, sold as a unit
25 or kit, assembled or installed by the retailer, certified by
26 the user to be used only for the production of ethyl alcohol
27 that will be used for consumption as motor fuel or as a
28 component of motor fuel for the personal use of the user, and
29 not subject to sale or resale.
30 (4) Graphic arts machinery and equipment, including
31 repair and replacement parts, both new and used, and
32 including that manufactured on special order or purchased for
33 lease, certified by the purchaser to be used primarily for
34 graphic arts production.
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1 (5) A motor vehicle of the first division, a motor
2 vehicle of the second division that is a self-contained motor
3 vehicle designed or permanently converted to provide living
4 quarters for recreational, camping, or travel use, with
5 direct walk through access to the living quarters from the
6 driver's seat, or a motor vehicle of the second division that
7 is of the van configuration designed for the transportation
8 of not less than 7 nor more than 16 passengers, as defined in
9 Section 1-146 of the Illinois Vehicle Code, that is used for
10 automobile renting, as defined in the Automobile Renting
11 Occupation and Use Tax Act.
12 (6) Personal property sold by a teacher-sponsored
13 student organization affiliated with an elementary or
14 secondary school located in Illinois.
15 (7) Proceeds of that portion of the selling price of a
16 passenger car the sale of which is subject to the Replacement
17 Vehicle Tax.
18 (8) Personal property sold to an Illinois county fair
19 association for use in conducting, operating, or promoting
20 the county fair.
21 (9) Personal property sold to a not-for-profit music or
22 dramatic arts organization that establishes, by proof
23 required by the Department by rule, that it has received an
24 exemption under Section 501(c) (3) of the Internal Revenue
25 Code and that is organized and operated for the presentation
26 of live public performances of musical or theatrical works on
27 a regular basis.
28 (10) 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
33 property was not purchased by the enterprise for the purpose
34 of resale by the enterprise.
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1 (11) Personal property sold to a governmental body, to a
2 corporation, society, association, foundation, or institution
3 organized and operated exclusively for charitable, religious,
4 or educational purposes, or to a not-for-profit corporation,
5 society, association, foundation, institution, or
6 organization that has no compensated officers or employees
7 and that is organized and operated primarily for the
8 recreation of persons 55 years of age or older. A limited
9 liability company may qualify for the exemption under this
10 paragraph only if the limited liability company is organized
11 and operated exclusively for educational purposes. On and
12 after July 1, 1987, however, no entity otherwise eligible for
13 this exemption shall make tax-free purchases unless it has an
14 active identification number issued by the Department.
15 (12) Personal property sold to interstate carriers for
16 hire for use as rolling stock moving in interstate commerce
17 or to lessors under leases of one year or longer executed or
18 in effect at the time of purchase by interstate carriers for
19 hire for use as rolling stock moving in interstate commerce
20 and equipment operated by a telecommunications provider,
21 licensed as a common carrier by the Federal Communications
22 Commission, which is permanently installed in or affixed to
23 aircraft moving in interstate commerce.
24 (13) Proceeds from sales to owners, lessors, or shippers
25 of tangible personal property that is utilized by interstate
26 carriers for hire for use as rolling stock moving in
27 interstate commerce and equipment operated by a
28 telecommunications provider, licensed as a common carrier by
29 the Federal Communications Commission, which is permanently
30 installed in or affixed to aircraft moving in interstate
31 commerce.
32 (14) Machinery and equipment that will be used by the
33 purchaser, or a lessee of the purchaser, primarily in the
34 process of manufacturing or assembling tangible personal
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1 property for wholesale or retail sale or lease, whether the
2 sale or lease is made directly by the manufacturer or by some
3 other person, whether the materials used in the process are
4 owned by the manufacturer or some other person, or whether
5 the sale or lease is made apart from or as an incident to the
6 seller's engaging in the service occupation of producing
7 machines, tools, dies, jigs, patterns, gauges, or other
8 similar items of no commercial value on special order for a
9 particular purchaser.
10 (15) Proceeds of mandatory service charges separately
11 stated on customers' bills for purchase and consumption of
12 food and beverages, to the extent that the proceeds of the
13 service charge are in fact turned over as tips or as a
14 substitute for tips to the employees who participate directly
15 in preparing, serving, hosting or cleaning up the food or
16 beverage function with respect to which the service charge is
17 imposed.
18 (16) Petroleum products sold to a purchaser if the
19 seller is prohibited by federal law from charging tax to the
20 purchaser.
21 (17) Tangible personal property sold to a common carrier
22 by rail or motor that receives the physical possession of the
23 property in Illinois and that transports the property, or
24 shares with another common carrier in the transportation of
25 the property, out of Illinois on a standard uniform bill of
26 lading showing the seller of the property as the shipper or
27 consignor of the property to a destination outside Illinois,
28 for use outside Illinois.
29 (18) Legal tender, currency, medallions, or gold or
30 silver coinage issued by the State of Illinois, the
31 government of the United States of America, or the government
32 of any foreign country, and bullion.
33 (19) Oil field exploration, drilling, and production
34 equipment, including (i) rigs and parts of rigs, rotary rigs,
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1 cable tool rigs, and workover rigs, (ii) pipe and tubular
2 goods, including casing and drill strings, (iii) pumps and
3 pump-jack units, (iv) storage tanks and flow lines, (v) any
4 individual replacement part for oil field exploration,
5 drilling, and production equipment, and (vi) machinery and
6 equipment purchased for lease; but excluding motor vehicles
7 required to be registered under the Illinois Vehicle Code.
8 (20) Photoprocessing machinery and equipment, including
9 repair and replacement parts, both new and used, including
10 that manufactured on special order, certified by the
11 purchaser to be used primarily for photoprocessing, and
12 including photoprocessing machinery and equipment purchased
13 for lease.
14 (21) Coal exploration, mining, offhighway hauling,
15 processing, maintenance, and reclamation equipment, including
16 replacement parts and equipment, and including equipment
17 purchased for lease, but excluding motor vehicles required to
18 be registered under the Illinois Vehicle Code.
19 (22) Fuel and petroleum products sold to or used by an
20 air carrier, certified by the carrier to be used for
21 consumption, shipment, or storage in the conduct of its
22 business as an air common carrier, for a flight destined for
23 or returning from a location or locations outside the United
24 States without regard to previous or subsequent domestic
25 stopovers.
26 (23) A transaction in which the purchase order is
27 received by a florist who is located outside Illinois, but
28 who has a florist located in Illinois deliver the property to
29 the purchaser or the purchaser's donee in Illinois.
30 (24) Fuel consumed or used in the operation of ships,
31 barges, or vessels that are used primarily in or for the
32 transportation of property or the conveyance of persons for
33 hire on rivers bordering on this State if the fuel is
34 delivered by the seller to the purchaser's barge, ship, or
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1 vessel while it is afloat upon that bordering river.
2 (25) A motor vehicle sold in this State to a nonresident
3 even though the motor vehicle is delivered to the nonresident
4 in this State, if the motor vehicle is not to be titled in
5 this State, and if a driveaway decal permit is issued to the
6 motor vehicle as provided in Section 3-603 of the Illinois
7 Vehicle Code or if the nonresident purchaser has vehicle
8 registration plates to transfer to the motor vehicle upon
9 returning to his or her home state. The issuance of the
10 driveaway decal permit or having the out-of-state
11 registration plates to be transferred is prima facie evidence
12 that the motor vehicle will not be titled in this State.
13 (26) Semen used for artificial insemination of livestock
14 for direct agricultural production.
15 (27) Horses, or interests in horses, registered with and
16 meeting the requirements of any of the Arabian Horse Club
17 Registry of America, Appaloosa Horse Club, American Quarter
18 Horse Association, United States Trotting Association, or
19 Jockey Club, as appropriate, used for purposes of breeding or
20 racing for prizes.
21 (28) Computers and communications equipment utilized for
22 any hospital purpose and equipment used in the diagnosis,
23 analysis, or treatment of hospital patients sold to a lessor
24 who leases the equipment, under a lease of one year or longer
25 executed or in effect at the time of the purchase, to a
26 hospital that has been issued an active tax exemption
27 identification number by the Department under Section 1g of
28 this Act.
29 (29) Personal property sold to a lessor who leases the
30 property, under a lease of one year or longer executed or in
31 effect at the time of the purchase, to a governmental body
32 that has been issued an active tax exemption identification
33 number by the Department under Section 1g of this Act.
34 (30) Beginning with taxable years ending on or after
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1 December 31, 1995 and ending with taxable years ending on or
2 before December 31, 2004, personal property that is donated
3 for disaster relief to be used in a State or federally
4 declared disaster area in Illinois or bordering Illinois by a
5 manufacturer or retailer that is registered in this State to
6 a corporation, society, association, foundation, or
7 institution that has been issued a sales tax exemption
8 identification number by the Department that assists victims
9 of the disaster who reside within the declared disaster area.
10 (31) Beginning with taxable years ending on or after
11 December 31, 1995 and ending with taxable years ending on or
12 before December 31, 2004, personal property that is used in
13 the performance of infrastructure repairs in this State,
14 including but not limited to municipal roads and streets,
15 access roads, bridges, sidewalks, waste disposal systems,
16 water and sewer line extensions, water distribution and
17 purification facilities, storm water drainage and retention
18 facilities, and sewage treatment facilities, resulting from a
19 State or federally declared disaster in Illinois or bordering
20 Illinois when such repairs are initiated on facilities
21 located in the declared disaster area within 6 months after
22 the disaster.
23 (32) A motor vehicle, as that term is defined in Section
24 1-146 of the Illinois Vehicle Code, that is donated to a
25 corporation, limited liability company, society, association,
26 foundation, or institution that is determined by the
27 Department to be organized and operated exclusively for
28 educational purposes. For purposes of this exemption, "a
29 corporation, limited liability company, society, association,
30 foundation, or institution organized and operated exclusively
31 for educational purposes" means all tax-supported public
32 schools, private schools that offer systematic instruction in
33 useful branches of learning by methods common to public
34 schools and that compare favorably in their scope and
-28- LRB9101956PTpkam01
1 intensity with the course of study presented in tax-supported
2 schools, and vocational or technical schools or institutes
3 organized and operated exclusively to provide a course of
4 study of not less than 6 weeks duration and designed to
5 prepare individuals to follow a trade or to pursue a manual,
6 technical, mechanical, industrial, business, or commercial
7 occupation.
8 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
9 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
10 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-519,
11 eff. 6-1-98; 90-552, eff. 12-12-97; 90-605, eff. 6-30-98;
12 revised 2-10-99.)
13 Section 99. Effective date. This Act takes effect upon
14 becoming law.".