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91_HB1387
LRB9103923PTpk
1 AN ACT to amend the Telecommunications Excise Tax Act by
2 changing Section 2.
3 Be it enacted by the People of the State of Illinois,
4 represented in the General Assembly:
5 Section 5. The Telecommunications Excise Tax Act is
6 amended by changing Section 2 as follows:
7 (35 ILCS 630/2) (from Ch. 120, par. 2002)
8 Sec. 2. As used in this Article, unless the context
9 clearly requires otherwise:
10 (a) "Gross charge" means the amount paid for the act or
11 privilege of originating or receiving telecommunications in
12 this State and for all services and equipment provided in
13 connection therewith by a retailer, valued in money whether
14 paid in money or otherwise, including cash, credits, services
15 and property of every kind or nature, and shall be determined
16 without any deduction on account of the cost of such
17 telecommunications, the cost of materials used, labor or
18 service costs or any other expense whatsoever. In case
19 credit is extended, the amount thereof shall be included only
20 as and when paid. "Gross charges" for private line service
21 shall include charges imposed at each channel point within
22 this State, charges for the channel mileage between each
23 channel point within this State, and charges for that portion
24 of the interstate inter-office channel provided within
25 Illinois. However, "gross charges" shall not include:
26 (1) any amounts added to a purchaser's bill because
27 of a charge made pursuant to (i) the tax imposed by this
28 Article; (ii) charges added to customers' bills pursuant
29 to the provisions of Sections 9-221 or 9-222 of the
30 Public Utilities Act, as amended, or any similar charges
31 added to customers' bills by retailers who are not
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1 subject to rate regulation by the Illinois Commerce
2 Commission for the purpose of recovering any of the tax
3 liabilities or other amounts specified in such provisions
4 of such Act; or (iii) the tax imposed by Section 4251 of
5 the Internal Revenue Code;
6 (2) charges for a sent collect telecommunication
7 received outside of the State;
8 (3) charges for leased time on equipment or charges
9 for the storage of data or information for subsequent
10 retrieval or the processing of data or information
11 intended to change its form or content. Such equipment
12 includes, but is not limited to, the use of calculators,
13 computers, data processing equipment, tabulating
14 equipment or accounting equipment and also includes the
15 usage of computers under a time-sharing agreement;
16 (4) charges for customer equipment, including such
17 equipment that is leased or rented by the customer from
18 any source, wherein such charges are disaggregated and
19 separately identified from other charges;
20 (5) charges to business enterprises certified under
21 Section 9-222.1 of the Public Utilities Act, as amended,
22 to the extent of such exemption and during the period of
23 time specified by the Department of Commerce and
24 Community Affairs;
25 (6) charges for telecommunications and all services
26 and equipment provided in connection therewith between a
27 parent corporation and its wholly owned subsidiaries or
28 between wholly owned subsidiaries when the tax imposed
29 under this Article has already been paid to a retailer
30 and only to the extent that the charges between the
31 parent corporation and wholly owned subsidiaries or
32 between wholly owned subsidiaries represent expense
33 allocation between the corporations and not the
34 generation of profit for the corporation rendering such
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1 service;
2 (7) bad debts. Bad debt means any portion of a debt
3 that is related to a sale at retail for which gross
4 charges are not otherwise deductible or excludable that
5 has become worthless or uncollectable, as determined
6 under applicable federal income tax standards. If the
7 portion of the debt deemed to be bad is subsequently
8 paid, the retailer shall report and pay the tax on that
9 portion during the reporting period in which the payment
10 is made;
11 (8) charges paid by inserting coins in
12 coin-operated telecommunication devices;
13 (9) amounts paid by telecommunications retailers
14 under the Telecommunications Municipal Infrastructure
15 Maintenance Fee Act;.
16 (10) charges paid by a taxpayer who is receiving a
17 grant under the Senior Citizens and Disabled Persons
18 Property Tax Relief and Pharmaceutical Assistance Act or
19 by the spouse of that taxpayer.
20 (b) "Amount paid" means the amount charged to the
21 taxpayer's service address in this State regardless of where
22 such amount is billed or paid.
23 (c) "Telecommunications", in addition to the meaning
24 ordinarily and popularly ascribed to it, includes, without
25 limitation, messages or information transmitted through use
26 of local, toll and wide area telephone service; private line
27 services; channel services; telegraph services;
28 teletypewriter; computer exchange services; cellular mobile
29 telecommunications service; specialized mobile radio;
30 stationary two way radio; paging service; or any other form
31 of mobile and portable one-way or two-way communications; or
32 any other transmission of messages or information by
33 electronic or similar means, between or among points by wire,
34 cable, fiber-optics, laser, microwave, radio, satellite or
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1 similar facilities. As used in this Act, "private line" means
2 a dedicated non-traffic sensitive service for a single
3 customer, that entitles the customer to exclusive or priority
4 use of a communications channel or group of channels, from
5 one or more specified locations to one or more other
6 specified locations. The definition of "telecommunications"
7 shall not include value added services in which computer
8 processing applications are used to act on the form, content,
9 code and protocol of the information for purposes other than
10 transmission. "Telecommunications" shall not include
11 purchases of telecommunications by a telecommunications
12 service provider for use as a component part of the service
13 provided by him to the ultimate retail consumer who
14 originates or terminates the taxable end-to-end
15 communications. Carrier access charges, right of access
16 charges, charges for use of inter-company facilities, and all
17 telecommunications resold in the subsequent provision of,
18 used as a component of, or integrated into end-to-end
19 telecommunications service shall be non-taxable as sales for
20 resale.
21 (d) "Interstate telecommunications" means all
22 telecommunications that either originate or terminate outside
23 this State.
24 (e) "Intrastate telecommunications" means all
25 telecommunications that originate and terminate within this
26 State.
27 (f) "Department" means the Department of Revenue of the
28 State of Illinois.
29 (g) "Director" means the Director of Revenue for the
30 Department of Revenue of the State of Illinois.
31 (h) "Taxpayer" means a person who individually or
32 through his agents, employees or permittees engages in the
33 act or privilege of originating or receiving
34 telecommunications in this State and who incurs a tax
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1 liability under this Article.
2 (i) "Person" means any natural individual, firm, trust,
3 estate, partnership, association, joint stock company, joint
4 venture, corporation, limited liability company, or a
5 receiver, trustee, guardian or other representative appointed
6 by order of any court, the Federal and State governments,
7 including State universities created by statute or any city,
8 town, county or other political subdivision of this State.
9 (j) "Purchase at retail" means the acquisition,
10 consumption or use of telecommunication through a sale at
11 retail.
12 (k) "Sale at retail" means the transmitting, supplying
13 or furnishing of telecommunications and all services and
14 equipment provided in connection therewith for a
15 consideration to persons other than the Federal and State
16 governments, and State universities created by statute and
17 other than between a parent corporation and its wholly owned
18 subsidiaries or between wholly owned subsidiaries for their
19 use or consumption and not for resale.
20 (l) "Retailer" means and includes every person engaged
21 in the business of making sales at retail as defined in this
22 Article. The Department may, in its discretion, upon
23 application, authorize the collection of the tax hereby
24 imposed by any retailer not maintaining a place of business
25 within this State, who, to the satisfaction of the
26 Department, furnishes adequate security to insure collection
27 and payment of the tax. Such retailer shall be issued,
28 without charge, a permit to collect such tax. When so
29 authorized, it shall be the duty of such retailer to collect
30 the tax upon all of the gross charges for telecommunications
31 in this State in the same manner and subject to the same
32 requirements as a retailer maintaining a place of business
33 within this State. The permit may be revoked by the
34 Department at its discretion.
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1 (m) "Retailer maintaining a place of business in this
2 State", or any like term, means and includes any retailer
3 having or maintaining within this State, directly or by a
4 subsidiary, an office, distribution facilities, transmission
5 facilities, sales office, warehouse or other place of
6 business, or any agent or other representative operating
7 within this State under the authority of the retailer or its
8 subsidiary, irrespective of whether such place of business or
9 agent or other representative is located here permanently or
10 temporarily, or whether such retailer or subsidiary is
11 licensed to do business in this State.
12 (n) "Service address" means the location of
13 telecommunications equipment from which the
14 telecommunications services are originated or at which
15 telecommunications services are received by a taxpayer. In
16 the event this may not be a defined location, as in the case
17 of mobile phones, paging systems, maritime systems,
18 air-to-ground systems and the like, service address shall
19 mean the location of a taxpayer's primary use of the
20 telecommunications equipment as defined by telephone number,
21 authorization code, or location in Illinois where bills are
22 sent.
23 (Source: P.A. 90-562, eff. 12-16-97.)