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91_SB0434
LRB9104499PTpk
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- LRB9104499PTpk
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- LRB9104499PTpk
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, both new and used,
5 including that manufactured on special order, certified by
6 the purchaser to be used primarily for production agriculture
7 or State or federal agricultural programs, including
8 individual replacement parts for the machinery and equipment,
9 including machinery and equipment purchased for lease, and
10 including implements of husbandry defined in Section 1-130 of
11 the Illinois Vehicle Code, farm machinery and agricultural
12 chemical and fertilizer spreaders, and nurse wagons required
13 to be registered under Section 3-809 of the Illinois Vehicle
14 Code, but excluding other motor vehicles required to be
15 registered under the Illinois Vehicle Code. Horticultural
16 polyhouses or hoop houses used for propagating, growing, or
17 overwintering plants shall be considered farm machinery and
18 equipment under this item (11). Agricultural chemical tender
19 tanks and dry boxes shall include units sold separately from
20 a motor vehicle required to be licensed and units sold
21 mounted on a motor vehicle required to be licensed if the
22 selling price of the tender is separately stated.
23 Farm machinery and equipment shall include precision
24 farming equipment that is installed or purchased to be
25 installed on farm machinery and equipment including, but not
26 limited to, tractors, harvesters, sprayers, planters,
27 seeders, or spreaders. Precision farming equipment includes,
28 but is not limited to, soil testing sensors, computers,
29 monitors, software, global positioning and mapping systems,
30 and other such equipment.
31 Farm machinery and equipment also includes computers,
32 sensors, software, and related equipment used primarily in
33 the computer-assisted operation of production agriculture
34 facilities, equipment, and activities such as, but not
-4- LRB9104499PTpk
1 limited to, the collection, monitoring, and correlation of
2 animal and crop data for the purpose of formulating animal
3 diets and agricultural chemicals. This item (11) is exempt
4 from the provisions of Section 3-90.
5 (12) Fuel and petroleum products sold to or used by an
6 air common carrier, certified by the carrier to be used for
7 consumption, shipment, or storage in the conduct of its
8 business as an air common carrier, for a flight destined for
9 or returning from a location or locations outside the United
10 States without regard to previous or subsequent domestic
11 stopovers.
12 (13) Proceeds of mandatory service charges separately
13 stated on customers' bills for the purchase and consumption
14 of food and beverages purchased at retail from a retailer, to
15 the extent that the proceeds of the service charge are in
16 fact turned over as tips or as a substitute for tips to the
17 employees who participate directly in preparing, serving,
18 hosting or cleaning up the food or beverage function with
19 respect to which the service charge is imposed.
20 (14) Oil field exploration, drilling, and production
21 equipment, including (i) rigs and parts of rigs, rotary rigs,
22 cable tool rigs, and workover rigs, (ii) pipe and tubular
23 goods, including casing and drill strings, (iii) pumps and
24 pump-jack units, (iv) storage tanks and flow lines, (v) any
25 individual replacement part for oil field exploration,
26 drilling, and production equipment, and (vi) machinery and
27 equipment purchased for lease; but excluding motor vehicles
28 required to be registered under the Illinois Vehicle Code.
29 (15) Photoprocessing machinery and equipment, including
30 repair and replacement parts, both new and used, including
31 that manufactured on special order, certified by the
32 purchaser to be used primarily for photoprocessing, and
33 including photoprocessing machinery and equipment purchased
34 for lease.
-5- LRB9104499PTpk
1 (16) Coal exploration, mining, offhighway hauling,
2 processing, maintenance, and reclamation equipment, including
3 replacement parts and equipment, and including equipment
4 purchased for lease, but excluding motor vehicles required to
5 be registered under the Illinois Vehicle Code.
6 (17) Distillation machinery and equipment, sold as a
7 unit or kit, assembled or installed by the retailer,
8 certified by the user to be used only for the production of
9 ethyl alcohol that will be used for consumption as motor fuel
10 or as a component of motor fuel for the personal use of the
11 user, and not subject to sale or resale.
12 (18) Manufacturing and assembling machinery and
13 equipment used primarily in the process of manufacturing or
14 assembling tangible personal property for wholesale or retail
15 sale or lease, whether that sale or lease is made directly by
16 the manufacturer or by some other person, whether the
17 materials used in the process are owned by the manufacturer
18 or some other person, or whether that sale or lease is made
19 apart from or as an incident to the seller's engaging in the
20 service occupation of producing machines, tools, dies, jigs,
21 patterns, gauges, or other similar items of no commercial
22 value on special order for a particular purchaser.
23 (19) Personal property delivered to a purchaser or
24 purchaser's donee inside Illinois when the purchase order for
25 that personal property was received by a florist located
26 outside Illinois who has a florist located inside Illinois
27 deliver the personal property.
28 (20) Semen used for artificial insemination of livestock
29 for direct agricultural production.
30 (21) Horses, or interests in horses, registered with and
31 meeting the requirements of any of the Arabian Horse Club
32 Registry of America, Appaloosa Horse Club, American Quarter
33 Horse Association, United States Trotting Association, or
34 Jockey Club, as appropriate, used for purposes of breeding or
-6- LRB9104499PTpk
1 racing for prizes.
2 (22) Computers and communications equipment utilized for
3 any hospital purpose and equipment used in the diagnosis,
4 analysis, or treatment of hospital patients purchased by a
5 lessor who leases the equipment, under a lease of one year or
6 longer executed or in effect at the time the lessor would
7 otherwise be subject to the tax imposed by this Act, to a
8 hospital that has been issued an active tax exemption
9 identification number by the Department under Section 1g of
10 the Retailers' Occupation Tax Act. If the equipment is
11 leased in a manner that does not qualify for this exemption
12 or is used in any other non-exempt manner, the lessor shall
13 be liable for the tax imposed under this Act or the Service
14 Use Tax Act, as the case may be, based on the fair market
15 value of the property at the time the non-qualifying use
16 occurs. No lessor shall collect or attempt to collect an
17 amount (however designated) that purports to reimburse that
18 lessor for the tax imposed by this Act or the Service Use Tax
19 Act, as the case may be, if the tax has not been paid by the
20 lessor. If a lessor improperly collects any such amount from
21 the lessee, the lessee shall have a legal right to claim a
22 refund of that amount from the lessor. If, however, that
23 amount is not refunded to the lessee for any reason, the
24 lessor is liable to pay that amount to the Department.
25 (23) Personal property purchased by a lessor who leases
26 the property, under a lease of one year or longer executed
27 or in effect at the time the lessor would otherwise be
28 subject to the tax imposed by this Act, to a governmental
29 body that has been issued an active sales tax exemption
30 identification number by the Department under Section 1g of
31 the Retailers' Occupation Tax Act. If the property is leased
32 in a manner that does not qualify for this exemption or used
33 in any other non-exempt manner, the lessor shall be liable
34 for the tax imposed under this Act or the Service Use Tax
-7- LRB9104499PTpk
1 Act, as the case may be, based on the fair market value of
2 the property at the time the non-qualifying use occurs. No
3 lessor shall collect or attempt to collect an amount (however
4 designated) that purports to reimburse that lessor for the
5 tax imposed by this Act or the Service Use Tax Act, as the
6 case may be, if the tax has not been paid by the lessor. If
7 a lessor improperly collects any such amount from the lessee,
8 the lessee shall have a legal right to claim a refund of that
9 amount from the lessor. If, however, that amount is not
10 refunded to the lessee for any reason, the lessor is liable
11 to pay that amount to the Department.
12 (24) 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 donated
15 for disaster relief to be used in a State or federally
16 declared disaster area in Illinois or bordering Illinois by a
17 manufacturer or retailer that is registered in this State to
18 a corporation, society, association, foundation, or
19 institution that has been issued a sales tax exemption
20 identification number by the Department that assists victims
21 of the disaster who reside within the declared disaster area.
22 (25) 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 used in
25 the performance of infrastructure repairs in this State,
26 including but not limited to municipal roads and streets,
27 access roads, bridges, sidewalks, waste disposal systems,
28 water and sewer line extensions, water distribution and
29 purification facilities, storm water drainage and retention
30 facilities, and sewage treatment facilities, resulting from a
31 State or federally declared disaster in Illinois or bordering
32 Illinois when such repairs are initiated on facilities
33 located in the declared disaster area within 6 months after
34 the disaster.
-8- LRB9104499PTpk
1 (26) Beginning July 1, 1999, game or game birds
2 purchased at a "game breeding and hunting preserve area" or
3 an "exotic game hunting area" as those terms are used in the
4 Wildlife Code or at a hunting enclosure approved through
5 rules adopted by the Department of Natural Resources. This
6 paragraph is exempt from the provisions of Section 3-90.
7 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
8 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
9 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
10 eff. 12-12-97; 90-605, eff. 6-30-98.)
11 Section 10. The Service Use Tax Act is amended by
12 changing Section 3-5 as follows:
13 (35 ILCS 110/3-5) (from Ch. 120, par. 439.33-5)
14 Sec. 3-5. Exemptions. Use of the following tangible
15 personal property is exempt from the tax imposed by this Act:
16 (1) Personal property purchased from a corporation,
17 society, association, foundation, institution, or
18 organization, other than a limited liability company, that is
19 organized and operated as a not-for-profit service enterprise
20 for the benefit of persons 65 years of age or older if the
21 personal property was not purchased by the enterprise for the
22 purpose of resale by the enterprise.
23 (2) Personal property purchased by a non-profit Illinois
24 county fair association for use in conducting, operating, or
25 promoting the county fair.
26 (3) Personal property purchased by a not-for-profit
27 music or dramatic arts organization that establishes, by
28 proof required by the Department by rule, that it has
29 received an exemption under Section 501(c)(3) of the Internal
30 Revenue Code and that is organized and operated for the
31 presentation of live public performances of musical or
32 theatrical works on a regular basis.
-9- LRB9104499PTpk
1 (4) 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 (5) Graphic arts machinery and equipment, including
6 repair and replacement parts, both new and used, and
7 including that manufactured on special order or purchased for
8 lease, certified by the purchaser to be used primarily for
9 graphic arts production.
10 (6) Personal property purchased from a teacher-sponsored
11 student organization affiliated with an elementary or
12 secondary school located in Illinois.
13 (7) 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 (7). 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
-10- LRB9104499PTpk
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 (7) is exempt
13 from the provisions of Section 3-75.
14 (8) 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 (9) Proceeds of mandatory service charges separately
22 stated on customers' bills for the purchase and consumption
23 of food and beverages acquired as an incident to the purchase
24 of a service from a serviceman, to the extent that the
25 proceeds of the service charge are in fact turned over as
26 tips or as a substitute for tips to the employees who
27 participate directly in preparing, serving, hosting or
28 cleaning up the food or beverage function with respect to
29 which the service charge is imposed.
30 (10) Oil field exploration, drilling, and production
31 equipment, including (i) rigs and parts of rigs, rotary rigs,
32 cable tool rigs, and workover rigs, (ii) pipe and tubular
33 goods, including casing and drill strings, (iii) pumps and
34 pump-jack units, (iv) storage tanks and flow lines, (v) any
-11- LRB9104499PTpk
1 individual replacement part for oil field exploration,
2 drilling, and production equipment, and (vi) machinery and
3 equipment purchased for lease; but excluding motor vehicles
4 required to be registered under the Illinois Vehicle Code.
5 (11) Proceeds from the sale of photoprocessing machinery
6 and equipment, including repair and replacement parts, both
7 new and used, including that manufactured on special order,
8 certified by the purchaser to be used primarily for
9 photoprocessing, and including photoprocessing machinery and
10 equipment purchased for lease.
11 (12) Coal exploration, mining, offhighway hauling,
12 processing, maintenance, and reclamation equipment, including
13 replacement parts and equipment, and including equipment
14 purchased for lease, but excluding motor vehicles required to
15 be registered under the Illinois Vehicle Code.
16 (13) Semen used for artificial insemination of livestock
17 for direct agricultural production.
18 (14) Horses, or interests in horses, registered with and
19 meeting the requirements of any of the Arabian Horse Club
20 Registry of America, Appaloosa Horse Club, American Quarter
21 Horse Association, United States Trotting Association, or
22 Jockey Club, as appropriate, used for purposes of breeding or
23 racing for prizes.
24 (15) Computers and communications equipment utilized for
25 any hospital purpose and equipment used in the diagnosis,
26 analysis, or treatment of hospital patients purchased by a
27 lessor who leases the equipment, under a lease of one year or
28 longer executed or in effect at the time the lessor would
29 otherwise be subject to the tax imposed by this Act, to a
30 hospital that has been issued an active tax exemption
31 identification number by the Department under Section 1g of
32 the Retailers' Occupation Tax Act. If the equipment is leased
33 in a manner that does not qualify for this exemption or is
34 used in any other non-exempt manner, the lessor shall be
-12- LRB9104499PTpk
1 liable for the tax imposed under this Act or the Use Tax Act,
2 as the case may be, based on the fair market value of the
3 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 Use Tax Act, as the case may
7 be, if the tax has not been paid by the lessor. If a lessor
8 improperly collects any such amount from the lessee, the
9 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 (16) Personal property purchased by a lessor who leases
14 the property, under a lease of one year or longer executed or
15 in effect at the time the lessor would otherwise be subject
16 to the tax imposed by this Act, to a governmental body that
17 has been issued an active tax exemption identification number
18 by the Department under Section 1g of the Retailers'
19 Occupation Tax Act. If the property is leased in a manner
20 that does not qualify for this exemption or is used in any
21 other non-exempt manner, the lessor shall be liable for the
22 tax imposed under this Act or the Use Tax Act, as the case
23 may be, based on the fair market value of the property at the
24 time the non-qualifying use occurs. No lessor shall collect
25 or attempt to collect an amount (however designated) that
26 purports to reimburse that lessor for the tax imposed by this
27 Act or the Use Tax Act, as the case may be, if the tax has
28 not been paid by the lessor. If a lessor improperly collects
29 any such amount from the lessee, the lessee shall have a
30 legal right to claim a refund of that amount from the lessor.
31 If, however, that amount is not refunded to the lessee for
32 any reason, the lessor is liable to pay that amount to the
33 Department.
34 (17) Beginning with taxable years ending on or after
-13- LRB9104499PTpk
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 (18) 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 (19) Beginning July 1, 1999, game or game birds
24 purchased at a "game breeding and hunting preserve area" or
25 an "exotic game hunting area" as those terms are used in the
26 Wildlife Code or at a hunting enclosure approved through
27 rules adopted by the Department of Natural Resources. This
28 paragraph is exempt from the provisions of Section 3-75.
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 15. The Service Occupation Tax Act is amended by
-14- LRB9104499PTpk
1 changing Section 3-5 as follows:
2 (35 ILCS 115/3-5) (from Ch. 120, par. 439.103-5)
3 Sec. 3-5. Exemptions. The following tangible personal
4 property is exempt from the tax imposed by this Act:
5 (1) Personal property sold by a corporation, society,
6 association, foundation, institution, or organization, other
7 than a limited liability company, that is organized and
8 operated as a not-for-profit service enterprise for the
9 benefit of persons 65 years of age or older if the personal
10 property was not purchased by the enterprise for the purpose
11 of resale by the enterprise.
12 (2) Personal property purchased by a not-for-profit
13 Illinois county fair association for use in conducting,
14 operating, or promoting the county fair.
15 (3) Personal property purchased by any 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
19 Internal Revenue Code and that is organized and operated for
20 the 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 sold by a teacher-sponsored
32 student organization affiliated with an elementary or
33 secondary school located in Illinois.
-15- LRB9104499PTpk
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
-16- LRB9104499PTpk
1 from the provisions of Section 3-55 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, to the extent that the proceeds of the
12 service charge are in fact turned over as tips or as a
13 substitute for tips to the employees who participate directly
14 in preparing, serving, hosting or cleaning up the food or
15 beverage function with respect to which the service charge is
16 imposed.
17 (10) Oil field exploration, drilling, and production
18 equipment, including (i) rigs and parts of rigs, rotary rigs,
19 cable tool rigs, and workover rigs, (ii) pipe and tubular
20 goods, including casing and drill strings, (iii) pumps and
21 pump-jack units, (iv) storage tanks and flow lines, (v) any
22 individual replacement part for oil field exploration,
23 drilling, and production equipment, and (vi) machinery and
24 equipment purchased for lease; but excluding motor vehicles
25 required to be registered under the Illinois Vehicle Code.
26 (11) Photoprocessing machinery and equipment, including
27 repair and replacement parts, both new and used, including
28 that manufactured on special order, certified by the
29 purchaser to be used primarily for photoprocessing, and
30 including photoprocessing machinery and equipment purchased
31 for lease.
32 (12) Coal exploration, mining, offhighway hauling,
33 processing, maintenance, and reclamation equipment, including
34 replacement parts and equipment, and including equipment
-17- LRB9104499PTpk
1 purchased for lease, but excluding motor vehicles required to
2 be registered under the Illinois Vehicle Code.
3 (13) Food for human consumption that is to be consumed
4 off the premises where it is sold (other than alcoholic
5 beverages, soft drinks and food that has been prepared for
6 immediate consumption) and prescription and non-prescription
7 medicines, drugs, medical appliances, and insulin, urine
8 testing materials, syringes, and needles used by diabetics,
9 for human use, when purchased for use by a person receiving
10 medical assistance under Article 5 of the Illinois Public Aid
11 Code who resides in a licensed long-term care facility, as
12 defined in the Nursing Home Care Act.
13 (14) Semen used for artificial insemination of livestock
14 for direct agricultural production.
15 (15) 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 (16) 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 the Retailers' Occupation Tax Act.
29 (17) 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 the Retailers'
34 Occupation Tax Act.
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1 (18) Beginning with taxable years ending on or after
2 December 31, 1995 and ending with taxable years ending on or
3 before December 31, 2004, personal property that is donated
4 for disaster relief to be used in a State or federally
5 declared disaster area in Illinois or bordering Illinois by a
6 manufacturer or retailer that is registered in this State to
7 a corporation, society, association, foundation, or
8 institution that has been issued a sales tax exemption
9 identification number by the Department that assists victims
10 of the disaster who reside within the declared disaster area.
11 (19) Beginning with taxable years ending on or after
12 December 31, 1995 and ending with taxable years ending on or
13 before December 31, 2004, personal property that is used in
14 the performance of infrastructure repairs in this State,
15 including but not limited to municipal roads and streets,
16 access roads, bridges, sidewalks, waste disposal systems,
17 water and sewer line extensions, water distribution and
18 purification facilities, storm water drainage and retention
19 facilities, and sewage treatment facilities, resulting from a
20 State or federally declared disaster in Illinois or bordering
21 Illinois when such repairs are initiated on facilities
22 located in the declared disaster area within 6 months after
23 the disaster.
24 (Source: P.A. 89-16, eff. 5-30-95; 89-115, eff. 1-1-96;
25 89-349, eff. 8-17-95; 89-495, eff. 6-24-96; 89-496, eff.
26 6-25-96; 89-626, eff. 8-9-96; 90-14, eff. 7-1-97; 90-552,
27 eff. 12-12-97; 90-605, eff. 6-30-98; revised 2-10-99.)
28 (20) Beginning July 1, 1999, game or game birds sold at
29 a "game breeding and hunting preserve area" or an "exotic
30 game hunting area" as those terms are used in the Wildlife
31 Code or at a hunting enclosure approved through rules adopted
32 by the Department of Natural Resources. This paragraph is
33 exempt from the provisions of Section 3-55.
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1 Section 20. The Retailers' Occupation Tax Act is amended
2 by changing Section 2-5 as follows:
3 (35 ILCS 120/2-5) (from Ch. 120, par. 441-5)
4 Sec. 2-5. Exemptions. Gross receipts from proceeds from
5 the sale of the following tangible personal property are
6 exempt from the tax imposed by this Act:
7 (1) Farm chemicals.
8 (2) Farm machinery and equipment, both new and used,
9 including that manufactured on special order, certified by
10 the purchaser to be used primarily for production agriculture
11 or State or federal agricultural programs, including
12 individual replacement parts for the machinery and equipment,
13 including machinery and equipment purchased for lease, and
14 including implements of husbandry defined in Section 1-130 of
15 the Illinois Vehicle Code, farm machinery and agricultural
16 chemical and fertilizer spreaders, and nurse wagons required
17 to be registered under Section 3-809 of the Illinois Vehicle
18 Code, but excluding other motor vehicles required to be
19 registered under the Illinois Vehicle Code. Horticultural
20 polyhouses or hoop houses used for propagating, growing, or
21 overwintering plants shall be considered farm machinery and
22 equipment under this item (2). Agricultural chemical tender
23 tanks and dry boxes shall include units sold separately from
24 a motor vehicle required to be licensed and units sold
25 mounted on a motor vehicle required to be licensed, if the
26 selling price of the tender is separately stated.
27 Farm machinery and equipment shall include precision
28 farming equipment that is installed or purchased to be
29 installed on farm machinery and equipment including, but not
30 limited to, tractors, harvesters, sprayers, planters,
31 seeders, or spreaders. Precision farming equipment includes,
32 but is not limited to, soil testing sensors, computers,
33 monitors, software, global positioning and mapping systems,
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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 2-70 3-75.
10 (3) Distillation machinery and equipment, sold as a unit
11 or kit, assembled or installed by the retailer, certified by
12 the user to be used only for the production of ethyl alcohol
13 that will be used for consumption as motor fuel or as a
14 component of motor fuel for the personal use of the user, and
15 not subject to sale or resale.
16 (4) Graphic arts machinery and equipment, including
17 repair and replacement parts, both new and used, and
18 including that manufactured on special order or purchased for
19 lease, certified by the purchaser to be used primarily for
20 graphic arts production.
21 (5) A motor vehicle of the first division, a motor
22 vehicle of the second division that is a self-contained motor
23 vehicle designed or permanently converted to provide living
24 quarters for recreational, camping, or travel use, with
25 direct walk through access to the living quarters from the
26 driver's seat, or a motor vehicle of the second division that
27 is of the van configuration designed for the transportation
28 of not less than 7 nor more than 16 passengers, as defined in
29 Section 1-146 of the Illinois Vehicle Code, that is used for
30 automobile renting, as defined in the Automobile Renting
31 Occupation and Use Tax Act.
32 (6) Personal property sold by a teacher-sponsored
33 student organization affiliated with an elementary or
34 secondary school located in Illinois.
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1 (7) Proceeds of that portion of the selling price of a
2 passenger car the sale of which is subject to the Replacement
3 Vehicle Tax.
4 (8) Personal property sold to an Illinois county fair
5 association for use in conducting, operating, or promoting
6 the county fair.
7 (9) Personal property sold to a not-for-profit music or
8 dramatic arts organization that establishes, by proof
9 required by the Department by rule, that it has received an
10 exemption under Section 501(c) (3) of the Internal Revenue
11 Code and that is organized and operated for the presentation
12 of live public performances of musical or theatrical works on
13 a regular basis.
14 (10) Personal property sold by a corporation, society,
15 association, foundation, institution, or organization, other
16 than a limited liability company, that is organized and
17 operated as a not-for-profit service enterprise for the
18 benefit of persons 65 years of age or older if the personal
19 property was not purchased by the enterprise for the purpose
20 of resale by the enterprise.
21 (11) Personal property sold to a governmental body, to a
22 corporation, society, association, foundation, or institution
23 organized and operated exclusively for charitable, religious,
24 or educational purposes, or to a not-for-profit corporation,
25 society, association, foundation, institution, or
26 organization that has no compensated officers or employees
27 and that is organized and operated primarily for the
28 recreation of persons 55 years of age or older. A limited
29 liability company may qualify for the exemption under this
30 paragraph only if the limited liability company is organized
31 and operated exclusively for educational purposes. On and
32 after July 1, 1987, however, no entity otherwise eligible for
33 this exemption shall make tax-free purchases unless it has an
34 active identification number issued by the Department.
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1 (12) Personal property sold to interstate carriers for
2 hire for use as rolling stock moving in interstate commerce
3 or to lessors under leases of one year or longer executed or
4 in effect at the time of purchase by interstate carriers for
5 hire for use as rolling stock moving in interstate commerce
6 and equipment operated by a telecommunications provider,
7 licensed as a common carrier by the Federal Communications
8 Commission, which is permanently installed in or affixed to
9 aircraft moving in interstate commerce.
10 (13) Proceeds from sales to owners, lessors, or shippers
11 of tangible personal property that is utilized by interstate
12 carriers for hire for use as rolling stock moving in
13 interstate commerce and equipment operated by a
14 telecommunications provider, licensed as a common carrier by
15 the Federal Communications Commission, which is permanently
16 installed in or affixed to aircraft moving in interstate
17 commerce.
18 (14) Machinery and equipment that will be used by the
19 purchaser, or a lessee of the purchaser, primarily in the
20 process of manufacturing or assembling tangible personal
21 property for wholesale or retail sale or lease, whether the
22 sale or lease is made directly by the manufacturer or by some
23 other person, whether the materials used in the process are
24 owned by the manufacturer or some other person, or whether
25 the sale or lease is made apart from or as an incident to the
26 seller's engaging in the service occupation of producing
27 machines, tools, dies, jigs, patterns, gauges, or other
28 similar items of no commercial value on special order for a
29 particular purchaser.
30 (15) Proceeds of mandatory service charges separately
31 stated on customers' bills for purchase and consumption of
32 food and beverages, to the extent that the proceeds of the
33 service charge are in fact turned over as tips or as a
34 substitute for tips to the employees who participate directly
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1 in preparing, serving, hosting or cleaning up the food or
2 beverage function with respect to which the service charge is
3 imposed.
4 (16) Petroleum products sold to a purchaser if the
5 seller is prohibited by federal law from charging tax to the
6 purchaser.
7 (17) Tangible personal property sold to a common carrier
8 by rail or motor that receives the physical possession of the
9 property in Illinois and that transports the property, or
10 shares with another common carrier in the transportation of
11 the property, out of Illinois on a standard uniform bill of
12 lading showing the seller of the property as the shipper or
13 consignor of the property to a destination outside Illinois,
14 for use outside Illinois.
15 (18) Legal tender, currency, medallions, or gold or
16 silver coinage issued by the State of Illinois, the
17 government of the United States of America, or the government
18 of any foreign country, and bullion.
19 (19) Oil field exploration, drilling, and production
20 equipment, including (i) rigs and parts of rigs, rotary rigs,
21 cable tool rigs, and workover rigs, (ii) pipe and tubular
22 goods, including casing and drill strings, (iii) pumps and
23 pump-jack units, (iv) storage tanks and flow lines, (v) any
24 individual replacement part for oil field exploration,
25 drilling, and production equipment, and (vi) machinery and
26 equipment purchased for lease; but excluding motor vehicles
27 required to be registered under the Illinois Vehicle Code.
28 (20) Photoprocessing machinery and equipment, including
29 repair and replacement parts, both new and used, including
30 that manufactured on special order, certified by the
31 purchaser to be used primarily for photoprocessing, and
32 including photoprocessing machinery and equipment purchased
33 for lease.
34 (21) Coal exploration, mining, offhighway hauling,
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1 processing, maintenance, and reclamation equipment, including
2 replacement parts and equipment, and including equipment
3 purchased for lease, but excluding motor vehicles required to
4 be registered under the Illinois Vehicle Code.
5 (22) Fuel and petroleum products sold to or used by an
6 air carrier, certified by the carrier to be used for
7 consumption, shipment, or storage in the conduct of its
8 business as an air common carrier, for a flight destined for
9 or returning from a location or locations outside the United
10 States without regard to previous or subsequent domestic
11 stopovers.
12 (23) A transaction in which the purchase order is
13 received by a florist who is located outside Illinois, but
14 who has a florist located in Illinois deliver the property to
15 the purchaser or the purchaser's donee in Illinois.
16 (24) Fuel consumed or used in the operation of ships,
17 barges, or vessels that are used primarily in or for the
18 transportation of property or the conveyance of persons for
19 hire on rivers bordering on this State if the fuel is
20 delivered by the seller to the purchaser's barge, ship, or
21 vessel while it is afloat upon that bordering river.
22 (25) A motor vehicle sold in this State to a nonresident
23 even though the motor vehicle is delivered to the nonresident
24 in this State, if the motor vehicle is not to be titled in
25 this State, and if a driveaway decal permit is issued to the
26 motor vehicle as provided in Section 3-603 of the Illinois
27 Vehicle Code or if the nonresident purchaser has vehicle
28 registration plates to transfer to the motor vehicle upon
29 returning to his or her home state. The issuance of the
30 driveaway decal permit or having the out-of-state
31 registration plates to be transferred is prima facie evidence
32 that the motor vehicle will not be titled in this State.
33 (26) Semen used for artificial insemination of livestock
34 for direct agricultural production.
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1 (27) Horses, or interests in horses, registered with and
2 meeting the requirements of any of the Arabian Horse Club
3 Registry of America, Appaloosa Horse Club, American Quarter
4 Horse Association, United States Trotting Association, or
5 Jockey Club, as appropriate, used for purposes of breeding or
6 racing for prizes.
7 (28) Computers and communications equipment utilized for
8 any hospital purpose and equipment used in the diagnosis,
9 analysis, or treatment of hospital patients sold to a lessor
10 who leases the equipment, under a lease of one year or longer
11 executed or in effect at the time of the purchase, to a
12 hospital that has been issued an active tax exemption
13 identification number by the Department under Section 1g of
14 this Act.
15 (29) Personal property sold to a lessor who leases the
16 property, under a lease of one year or longer executed or in
17 effect at the time of the purchase, to a governmental body
18 that has been issued an active tax exemption identification
19 number by the Department under Section 1g of this Act.
20 (30) Beginning with taxable years ending on or after
21 December 31, 1995 and ending with taxable years ending on or
22 before December 31, 2004, personal property that is donated
23 for disaster relief to be used in a State or federally
24 declared disaster area in Illinois or bordering Illinois by a
25 manufacturer or retailer that is registered in this State to
26 a corporation, society, association, foundation, or
27 institution that has been issued a sales tax exemption
28 identification number by the Department that assists victims
29 of the disaster who reside within the declared disaster area.
30 (31) 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 used in
33 the performance of infrastructure repairs in this State,
34 including but not limited to municipal roads and streets,
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1 access roads, bridges, sidewalks, waste disposal systems,
2 water and sewer line extensions, water distribution and
3 purification facilities, storm water drainage and retention
4 facilities, and sewage treatment facilities, resulting from a
5 State or federally declared disaster in Illinois or bordering
6 Illinois when such repairs are initiated on facilities
7 located in the declared disaster area within 6 months after
8 the disaster.
9 (32) Beginning July 1, 1999, game or game birds sold at
10 a "game breeding and hunting preserve area" or an "exotic
11 game hunting area" as those terms are used in the Wildlife
12 Code or at a hunting enclosure approved through rules adopted
13 by the Department of Natural Resources. This paragraph is
14 exempt from the provisions of Section 2-70.
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; 90-519,
18 eff. 6-1-98; 90-552, eff. 12-12-97; 90-605, eff. 6-30-98;
19 revised 2-10-99.)
20 Section 99. Effective date. This Act takes effect upon
21 becoming law.