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91_SB1674
LRB9113151SMdv
1 AN ACT concerning prepaid telephone calling arrangements.
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 and by adding Section 3-27 as follows:
6 (35 ILCS 105/3) (from Ch. 120, par. 439.3)
7 Sec. 3. Tax imposed. A tax is imposed upon the privilege
8 of using in this State tangible personal property purchased
9 at retail from a retailer, including computer software, and
10 including photographs, negatives, and positives that are the
11 product of photoprocessing, but not including products of
12 photoprocessing produced for use in motion pictures for
13 commercial exhibition. Beginning January 1, 2001, prepaid
14 telephone calling arrangements shall be considered tangible
15 personal property subject to the tax imposed under this Act
16 regardless of the form in which those arrangements may be
17 embodied, transmitted, or fixed by any method now known or
18 hereafter developed.
19 (Source: P.A. 91-51, eff. 6-30-99.)
20 (35 ILCS 105/3-27 new)
21 Sec. 3-27. Prepaid telephone calling arrangements.
22 "Prepaid telephone calling arrangements" mean the right to
23 exclusively purchase telephone or telecommunications services
24 that must be paid for in advance and enable the origination
25 of one or more intrastate, interstate, or international
26 telephone calls or other telecommunications using an access
27 number, an authorizations code, or both, whether manually or
28 electronically dialed, for which payment to a retailer must
29 be made in advance, provided that, unless recharged, no
30 further service is provided once that prepaid amount of
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1 service has been consumed. Prepaid telephone calling
2 arrangements include the recharge of a prepaid calling
3 arrangement. For purposes of this Section, "recharge" means
4 the purchase of additional prepaid telephone or
5 telecommunications services whether or not the purchaser
6 acquires a different access number or authorization code.
7 For purposes of this Section, "telecommunications" means that
8 term as defined in Section 2 of the Telecommunications Excise
9 Tax Act. "Prepaid telephone calling arrangement" does not
10 include an arrangement whereby a customer purchases a payment
11 card and pursuant to which the service provider reflects the
12 amount of such purchase as a credit on an invoice issued to
13 that customer under an existing subscription plan.
14 Section 10. The Service Use Tax Act is amended by
15 changing Section 3 and by adding 3-27 as follows:
16 (35 ILCS 110/3) (from Ch. 120, par. 439.33)
17 Sec. 3. Tax imposed. A tax is imposed upon the
18 privilege of using in this State real or tangible personal
19 property acquired as an incident to the purchase of a service
20 from a serviceman, including computer software, and including
21 photographs, negatives, and positives that are the product of
22 photoprocessing, but not including products of
23 photoprocessing produced for use in motion pictures for
24 public commercial exhibition. Beginning January 1, 2001,
25 prepaid telephone calling arrangements shall be considered
26 tangible personal property subject to the tax imposed under
27 this Act regardless of the form in which those arrangements
28 may be embodied, transmitted, or fixed by any method now
29 known or hereafter developed.
30 (Source: P.A. 91-51, eff. 6-30-99.)
31 (35 ILCS 110/3-27 new)
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1 Sec. 3-27. Prepaid telephone calling arrangements.
2 "Prepaid telephone calling arrangements" mean the right to
3 exclusively purchase telephone or telecommunications services
4 that must be paid for in advance and enable the origination
5 of one or more intrastate, interstate, or international
6 telephone calls or other telecommunications using an access
7 number, an authorizations code, or both, whether manually or
8 electronically dialed, for which payment to a retailer must
9 be made in advance, provided that, unless recharged, no
10 further service is provided once that prepaid amount of
11 service has been consumed. Prepaid telephone calling
12 arrangements include the recharge of a prepaid calling
13 arrangement. For purposes of this Section, "recharge" means
14 the purchase of additional prepaid telephone or
15 telecommunications services whether or not the purchaser
16 acquires a different access number or authorization code.
17 For purposes of this Section, "telecommunications" means that
18 term as defined in Section 2 of the Telecommunications Excise
19 Tax Act. "Prepaid telephone calling arrangement" does not
20 include an arrangement whereby a customer purchases a payment
21 card and pursuant to which the service provider reflects the
22 amount of such purchase as a credit on an invoice issued to
23 that customer under an existing subscription plan.
24 Section 15. The Service Occupation Tax Act is amended by
25 changing Section 3 and by adding Section 3-27 as follows:
26 (35 ILCS 115/3) (from Ch. 120, par. 439.103)
27 Sec. 3. Tax imposed. A tax is imposed upon all persons
28 engaged in the business of making sales of service ( referred
29 to as "servicemen") on all tangible personal property
30 transferred as an incident of a sale of service, including
31 computer software, and including photographs, negatives, and
32 positives that are the product of photoprocessing, but not
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1 including products of photoprocessing produced for use in
2 motion pictures for public commercial exhibition. Beginning
3 January 1, 2001, prepaid telephone calling arrangements shall
4 be considered tangible personal property subject to the tax
5 imposed under this Act regardless of the form in which those
6 arrangements may be embodied, transmitted, or fixed by any
7 method now known or hereafter developed.
8 (Source: P.A. 91-51, eff. 6-30-99.)
9 (35 ILCS 115/3-27 new)
10 Sec. 3-27. Prepaid telephone calling arrangements.
11 "Prepaid telephone calling arrangements" mean the right to
12 exclusively purchase telephone or telecommunications services
13 that must be paid for in advance and enable the origination
14 of one or more intrastate, interstate, or international
15 telephone calls or other telecommunications using an access
16 number, an authorizations code, or both, whether manually or
17 electronically dialed, for which payment to a retailer must
18 be made in advance, provided that, unless recharged, no
19 further service is provided once that prepaid amount of
20 service has been consumed. Prepaid telephone calling
21 arrangements include the recharge of a prepaid calling
22 arrangement. For purposes of this Section, "recharge" means
23 the purchase of additional prepaid telephone or
24 telecommunications services whether or not the purchaser
25 acquires a different access number or authorization code.
26 For purposes of this Section, "telecommunications" means that
27 term as defined in Section 2 of the Telecommunications Excise
28 Tax Act. "Prepaid telephone calling arrangement" does not
29 include an arrangement whereby a customer purchases a payment
30 card and pursuant to which the service provider reflects the
31 amount of such purchase as a credit on an invoice issued to
32 that customer under an existing subscription plan.
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1 Section 20. The Retailers' Occupation Tax Act is amended
2 by changing Section 2 and by adding Section 2-27 as follows:
3 (35 ILCS 120/2) (from Ch. 120, par. 441)
4 Sec. 2. Tax imposed. A tax is imposed upon persons
5 engaged in the business of selling at retail tangible
6 personal property, including computer software, and including
7 photographs, negatives, and positives that are the product of
8 photoprocessing, but not including products of
9 photoprocessing produced for use in motion pictures for
10 public commercial exhibition. Beginning January 1, 2001,
11 prepaid telephone calling arrangements shall be considered
12 tangible personal property subject to the tax imposed under
13 this Act regardless of the form in which those arrangements
14 may be embodied, transmitted, or fixed by any method now
15 known or hereafter developed.
16 (Source: P.A. 91-51, eff. 6-30-99.)
17 (35 ILCS 120/2-27 new)
18 Sec. 2-27. Prepaid telephone calling arrangements.
19 "Prepaid telephone calling arrangements" mean the right to
20 exclusively purchase telephone or telecommunications services
21 that must be paid for in advance and enable the origination
22 of one or more intrastate, interstate, or international
23 telephone calls or other telecommunications using an access
24 number, an authorizations code, or both, whether manually or
25 electronically dialed, for which payment to a retailer must
26 be made in advance, provided that, unless recharged, no
27 further service is provided once that prepaid amount of
28 service has been consumed. Prepaid telephone calling
29 arrangements include the recharge of a prepaid calling
30 arrangement. For purposes of this Section, "recharge" means
31 the purchase of additional prepaid telephone or
32 telecommunications services whether or not the purchaser
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1 acquires a different access number or authorization code.
2 For purposes of this Section, "telecommunications" means that
3 term as defined in Section 2 of the Telecommunications Excise
4 Tax Act. "Prepaid telephone calling arrangement" does not
5 include an arrangement whereby a customer purchases a payment
6 card and pursuant to which the service provider reflects the
7 amount of such purchase as a credit on an invoice issued to
8 that customer under an existing subscription plan.
9 Section 25. The Telecommunications Excise Tax Act is
10 amended by changing Sections 2, 3, and 6 as follows:
11 (35 ILCS 630/2) (from Ch. 120, par. 2002)
12 Sec. 2. As used in this Article, unless the context
13 clearly requires otherwise:
14 (a) "Gross charge" means the amount paid for the act or
15 privilege of originating or receiving telecommunications in
16 this State and for all services and equipment provided in
17 connection therewith by a retailer, valued in money whether
18 paid in money or otherwise, including cash, credits, services
19 and property of every kind or nature, and shall be determined
20 without any deduction on account of the cost of such
21 telecommunications, the cost of materials used, labor or
22 service costs or any other expense whatsoever. In case
23 credit is extended, the amount thereof shall be included only
24 as and when paid. "Gross charges" for private line service
25 shall include charges imposed at each channel point within
26 this State, charges for the channel mileage between each
27 channel point within this State, and charges for that portion
28 of the interstate inter-office channel provided within
29 Illinois. However, "gross charges" shall not include:
30 (1) any amounts added to a purchaser's bill because
31 of a charge made pursuant to (i) the tax imposed by this
32 Article; (ii) charges added to customers' bills pursuant
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1 to the provisions of Sections 9-221 or 9-222 of the
2 Public Utilities Act, as amended, or any similar charges
3 added to customers' bills by retailers who are not
4 subject to rate regulation by the Illinois Commerce
5 Commission for the purpose of recovering any of the tax
6 liabilities or other amounts specified in such provisions
7 of such Act; or (iii) the tax imposed by Section 4251 of
8 the Internal Revenue Code;
9 (2) charges for a sent collect telecommunication
10 received outside of the State;
11 (3) charges for leased time on equipment or charges
12 for the storage of data or information for subsequent
13 retrieval or the processing of data or information
14 intended to change its form or content. Such equipment
15 includes, but is not limited to, the use of calculators,
16 computers, data processing equipment, tabulating
17 equipment or accounting equipment and also includes the
18 usage of computers under a time-sharing agreement;
19 (4) charges for customer equipment, including such
20 equipment that is leased or rented by the customer from
21 any source, wherein such charges are disaggregated and
22 separately identified from other charges;
23 (5) charges to business enterprises certified under
24 Section 9-222.1 of the Public Utilities Act, as amended,
25 to the extent of such exemption and during the period of
26 time specified by the Department of Commerce and
27 Community Affairs;
28 (6) charges for telecommunications and all services
29 and equipment provided in connection therewith between a
30 parent corporation and its wholly owned subsidiaries or
31 between wholly owned subsidiaries when the tax imposed
32 under this Article has already been paid to a retailer
33 and only to the extent that the charges between the
34 parent corporation and wholly owned subsidiaries or
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1 between wholly owned subsidiaries represent expense
2 allocation between the corporations and not the
3 generation of profit for the corporation rendering such
4 service;
5 (7) bad debts. Bad debt means any portion of a debt
6 that is related to a sale at retail for which gross
7 charges are not otherwise deductible or excludable that
8 has become worthless or uncollectable, as determined
9 under applicable federal income tax standards. If the
10 portion of the debt deemed to be bad is subsequently
11 paid, the retailer shall report and pay the tax on that
12 portion during the reporting period in which the payment
13 is made;
14 (8) charges paid by inserting coins in
15 coin-operated telecommunication devices;
16 (9) amounts paid by telecommunications retailers
17 under the Telecommunications Municipal Infrastructure
18 Maintenance Fee Act.
19 (b) "Amount paid" means the amount charged to the
20 taxpayer's service address in this State regardless of where
21 such amount is billed or paid.
22 (c) "Telecommunications", in addition to the meaning
23 ordinarily and popularly ascribed to it, includes, without
24 limitation, messages or information transmitted through use
25 of local, toll and wide area telephone service; private line
26 services; channel services; telegraph services;
27 teletypewriter; computer exchange services; cellular mobile
28 telecommunications service; specialized mobile radio;
29 stationary two way radio; paging service; or any other form
30 of mobile and portable one-way or two-way communications; or
31 any other transmission of messages or information by
32 electronic or similar means, between or among points by wire,
33 cable, fiber-optics, laser, microwave, radio, satellite or
34 similar facilities. As used in this Act, "private line" means
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1 a dedicated non-traffic sensitive service for a single
2 customer, that entitles the customer to exclusive or priority
3 use of a communications channel or group of channels, from
4 one or more specified locations to one or more other
5 specified locations. The definition of "telecommunications"
6 shall not include value added services in which computer
7 processing applications are used to act on the form, content,
8 code and protocol of the information for purposes other than
9 transmission. "Telecommunications" shall not include
10 purchases of telecommunications by a telecommunications
11 service provider for use as a component part of the service
12 provided by him to the ultimate retail consumer who
13 originates or terminates the taxable end-to-end
14 communications. Carrier access charges, right of access
15 charges, charges for use of inter-company facilities, and all
16 telecommunications resold in the subsequent provision of,
17 used as a component of, or integrated into end-to-end
18 telecommunications service shall be non-taxable as sales for
19 resale.
20 (d) "Interstate telecommunications" means all
21 telecommunications that either originate or terminate outside
22 this State.
23 (e) "Intrastate telecommunications" means all
24 telecommunications that originate and terminate within this
25 State.
26 (f) "Department" means the Department of Revenue of the
27 State of Illinois.
28 (g) "Director" means the Director of Revenue for the
29 Department of Revenue of the State of Illinois.
30 (h) "Taxpayer" means a person who individually or
31 through his agents, employees or permittees engages in the
32 act or privilege of originating or receiving
33 telecommunications in this State and who incurs a tax
34 liability under this Article.
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1 (i) "Person" means any natural individual, firm, trust,
2 estate, partnership, association, joint stock company, joint
3 venture, corporation, limited liability company, or a
4 receiver, trustee, guardian or other representative appointed
5 by order of any court, the Federal and State governments,
6 including State universities created by statute or any city,
7 town, county or other political subdivision of this State.
8 (j) "Purchase at retail" means the acquisition,
9 consumption or use of telecommunication through a sale at
10 retail.
11 (k) "Sale at retail" means the transmitting, supplying
12 or furnishing of telecommunications and all services and
13 equipment provided in connection therewith for a
14 consideration to persons other than the Federal and State
15 governments, and State universities created by statute and
16 other than between a parent corporation and its wholly owned
17 subsidiaries or between wholly owned subsidiaries for their
18 use or consumption and not for resale.
19 (l) "Retailer" means and includes every person engaged
20 in the business of making sales at retail as defined in this
21 Article. The Department may, in its discretion, upon
22 application, authorize the collection of the tax hereby
23 imposed by any retailer not maintaining a place of business
24 within this State, who, to the satisfaction of the
25 Department, furnishes adequate security to insure collection
26 and payment of the tax. Such retailer shall be issued,
27 without charge, a permit to collect such tax. When so
28 authorized, it shall be the duty of such retailer to collect
29 the tax upon all of the gross charges for telecommunications
30 in this State in the same manner and subject to the same
31 requirements as a retailer maintaining a place of business
32 within this State. The permit may be revoked by the
33 Department at its discretion.
34 (m) "Retailer maintaining a place of business in this
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1 State", or any like term, means and includes any retailer
2 having or maintaining within this State, directly or by a
3 subsidiary, an office, distribution facilities, transmission
4 facilities, sales office, warehouse or other place of
5 business, or any agent or other representative operating
6 within this State under the authority of the retailer or its
7 subsidiary, irrespective of whether such place of business or
8 agent or other representative is located here permanently or
9 temporarily, or whether such retailer or subsidiary is
10 licensed to do business in this State.
11 (n) "Service address" means the location of
12 telecommunications equipment from which the
13 telecommunications services are originated or at which
14 telecommunications services are received by a taxpayer. In
15 the event this may not be a defined location, as in the case
16 of mobile phones, paging systems, maritime systems,
17 air-to-ground systems and the like, service address shall
18 mean the location of a taxpayer's primary use of the
19 telecommunications equipment as defined by telephone number,
20 authorization code, or location in Illinois where bills are
21 sent.
22 (o) "Prepaid telephone calling arrangements" mean the
23 right to exclusively purchase telephone or telecommunications
24 services that must be paid for in advance and enable the
25 origination of one or more intrastate, interstate, or
26 international telephone calls or other telecommunications
27 using an access number, an authorizations code, or both,
28 whether manually or electronically dialed, for which payment
29 to a retailer must be made in advance, provided that, unless
30 recharged, no further service is provided once that prepaid
31 amount of service has been consumed. Prepaid telephone
32 calling arrangements include the recharge of a prepaid
33 calling arrangement. For purposes of this subsection,
34 "recharge" means the purchase of additional prepaid telephone
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1 or telecommunications services whether or not the purchaser
2 acquires a different access number or authorization code.
3 "Prepaid telephone calling arrangement" does not include an
4 arrangement whereby a customer purchases a payment card and
5 pursuant to which the service provider reflects the amount of
6 such purchase as a credit on an invoice issued to that
7 customer under an existing subscription plan.
8 (Source: P.A. 90-562, eff. 12-16-97.)
9 (35 ILCS 630/3) (from Ch. 120, par. 2003)
10 Sec. 3. Until December 31, 1997, a tax is imposed upon
11 the act or privilege of originating or receiving intrastate
12 telecommunications by a person in this State at the rate of
13 5% of the gross charge for such telecommunications purchased
14 at retail from a retailer by such person. Beginning January
15 1, 1998, a tax is imposed upon the act or privilege of
16 originating in this State or receiving in this State
17 intrastate telecommunications by a person in this State at
18 the rate of 7% of the gross charge for such
19 telecommunications purchased at retail from a retailer by
20 such person. However, such tax is not imposed on the act or
21 privilege to the extent such act or privilege may not, under
22 the Constitution and statutes of the United States, be made
23 the subject of taxation by the State. Beginning January 1,
24 2001, prepaid telephone calling arrangements shall not be
25 considered telecommunications subject to the tax imposed
26 under this Act.
27 (Source: P.A. 90-548, eff. 12-4-97.)
28 (35 ILCS 630/6) (from Ch. 120, par. 2006)
29 Sec. 6. Except as provided hereinafter in this Section,
30 on or before the 15th day of each month each retailer
31 maintaining a place of business in this State shall make a
32 return to the Department for the preceding calendar month,
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1 stating:
2 1. His name;
3 2. The address of his principal place of business,
4 and the address of the principal place of business (if
5 that is a different address) from which he engages in the
6 business of transmitting telecommunications;
7 3. Total amount of gross charges billed by him
8 during the preceding calendar month for providing
9 telecommunications during such calendar month;
10 4. Total amount received by him during the
11 preceding calendar month on credit extended;
12 5. Deductions allowed by law;
13 6. Gross charges which were billed by him during
14 the preceding calendar month and upon the basis of which
15 the tax is imposed;
16 7. Amount of tax (computed upon Item 6);
17 8. Such other reasonable information as the
18 Department may require.
19 Any taxpayer required to make payments under this Section
20 may make the payments by electronic funds transfer. The
21 Department shall adopt rules necessary to effectuate a
22 program of electronic funds transfer.
23 If the retailer's average monthly tax billings due to the
24 Department do not exceed $200, the Department may authorize
25 his returns to be filed on a quarter annual basis, with the
26 return for January, February and March of a given year being
27 due by April 15 of such year; with the return for April, May
28 and June of a given year being due by July 15 of such year;
29 with the return for July, August and September of a given
30 year being due by October 15 of such year; and with the
31 return of October, November and December of a given year
32 being due by January 15 of the following year.
33 If the retailer is otherwise required to file a monthly
34 or quarterly return and if the retailer's average monthly tax
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1 billings due to the Department do not exceed $50, the
2 Department may authorize his or her return to be filed on an
3 annual basis, with the return for a given year being due by
4 January 15th of the following year.
5 Notwithstanding any other provision of this Article
6 containing the time within which a retailer may file his
7 return, in the case of any retailer who ceases to engage in a
8 kind of business which makes him responsible for filing
9 returns under this Article, such retailer shall file a final
10 return under this Article with the Department not more than
11 one month after discontinuing such business.
12 In making such return, the retailer shall determine the
13 value of any consideration other than money received by him
14 and he shall include such value in his return. Such
15 determination shall be subject to review and revision by the
16 Department in the manner hereinafter provided for the
17 correction of returns.
18 Each retailer whose average monthly liability to the
19 Department under this Article was $10,000 or more during the
20 preceding calendar year, excluding the month of highest
21 liability and the month of lowest liability in such calendar
22 year, and who is not operated by a unit of local government,
23 shall make estimated payments to the Department on or before
24 the 7th, 15th, 22nd and last day of the month during which
25 tax collection liability to the Department is incurred in an
26 amount not less than the lower of either 22.5% of the
27 retailer's actual tax collections for the month or 25% of the
28 retailer's actual tax collections for the same calendar month
29 of the preceding year. The amount of such quarter monthly
30 payments shall be credited against the final liability of the
31 retailer's return for that month. Any outstanding credit,
32 approved by the Department, arising from the retailer's
33 overpayment of its final liability for any month may be
34 applied to reduce the amount of any subsequent quarter
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1 monthly payment or credited against the final liability of
2 the retailer's return for any subsequent month. If any
3 quarter monthly payment is not paid at the time or in the
4 amount required by this Section, the retailer shall be liable
5 for penalty and interest on the difference between the
6 minimum amount due as a payment and the amount of such
7 payment actually and timely paid, except insofar as the
8 retailer has previously made payments for that month to the
9 Department in excess of the minimum payments previously due.
10 If the Director finds that the information required for
11 the making of an accurate return cannot reasonably be
12 compiled by a retailer within 15 days after the close of the
13 calendar month for which a return is to be made, he may grant
14 an extension of time for the filing of such return for a
15 period of not to exceed 31 calendar days. The granting of
16 such an extension may be conditioned upon the deposit by the
17 retailer with the Department of an amount of money not
18 exceeding the amount estimated by the Director to be due with
19 the return so extended. All such deposits, including any
20 heretofore made with the Department, shall be credited
21 against the retailer's liabilities under this Article. If
22 any such deposit exceeds the retailer's present and probable
23 future liabilities under this Article, the Department shall
24 issue to the retailer a credit memorandum, which may be
25 assigned by the retailer to a similar retailer under this
26 Article, in accordance with reasonable rules and regulations
27 to be prescribed by the Department.
28 The retailer making the return herein provided for shall,
29 at the time of making such return, pay to the Department the
30 amount of tax herein imposed. On and after the effective date
31 of this Article of 1985, $1,000,000 of the moneys received by
32 the Department of Revenue pursuant to this Article shall be
33 paid each month into the Common School Fund and the remainder
34 into the General Revenue Fund. On and after February 1, 1998,
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1 however, of the moneys received by the Department of Revenue
2 pursuant to the additional taxes imposed by this amendatory
3 Act of 1997 one-half shall be deposited into the School
4 Infrastructure Fund and one-half shall be deposited into the
5 Common School Fund. On and after the effective date of this
6 amendatory Act of the 91st General Assembly, if in any fiscal
7 year the total of the moneys deposited into the School
8 Infrastructure Fund under this Act is less than the total of
9 the moneys deposited into that Fund from the additional taxes
10 imposed by Public Act 90-548 during fiscal year 1999, then,
11 as soon as possible after the close of the fiscal year, the
12 Comptroller shall order transferred and the Treasurer shall
13 transfer from the General Revenue Fund to the School
14 Infrastructure Fund an amount equal to the difference between
15 the fiscal year total deposits and the total amount deposited
16 into the Fund in fiscal year 1999.
17 (Source: P.A. 90-16, eff. 6-16-97; 90-548, eff. 12-4-97;
18 91-541, eff. 8-13-99.)
19 Section 30. The Telecommunications Municipal
20 Infrastructure Maintenance Fee Act is amended by changing
21 Sections 10 and 20 as follows:
22 (35 ILCS 635/10)
23 Sec. 10. Definitions.
24 (a) "Gross charges" means the amount paid to a
25 telecommunications retailer for the act or privilege of
26 originating or receiving telecommunications in this State or
27 the municipality imposing the fee under this Act, as the
28 context requires, and for all services rendered in connection
29 therewith, valued in money whether paid in money or
30 otherwise, including cash, credits, services, and property of
31 every kind or nature, and shall be determined without any
32 deduction on account of the cost of such telecommunications,
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1 the cost of the materials used, labor or service costs, or
2 any other expense whatsoever. In case credit is extended,
3 the amount thereof shall be included only as and when paid.
4 "Gross charges" for private line service shall include
5 charges imposed at each channel point within this State or
6 the municipality imposing the fee under this Act, charges for
7 the channel mileage between each channel point within this
8 State or the municipality imposing the fee under this Act,
9 and charges for that portion of the interstate inter-office
10 channel provided within Illinois or the municipality imposing
11 the fee under this Act. However, "gross charges" shall not
12 include:
13 (1) any amounts added to a purchaser's bill because
14 of a charge made under: (i) the fee imposed by this
15 Section, (ii) additional charges added to a purchaser's
16 bill under Section 9-221 or 9-222 of the Public Utilities
17 Act, (iii) amounts collected under Section 8-11-17 of the
18 Illinois Municipal Code, (iv) the tax imposed by the
19 Telecommunications Excise Tax Act, (v) 911 surcharges, or
20 (vi) the tax imposed by Section 4251 of the Internal
21 Revenue Code;
22 (2) charges for a sent collect telecommunication
23 received outside of this State or the municipality
24 imposing the fee, as the context requires;
25 (3) charges for leased time on equipment or charges
26 for the storage of data or information or subsequent
27 retrieval or the processing of data or information
28 intended to change its form or content. Such equipment
29 includes, but is not limited to, the use of calculators,
30 computers, data processing equipment, tabulating
31 equipment, or accounting equipment and also includes the
32 usage of computers under a time-sharing agreement.
33 (4) charges for customer equipment, including such
34 equipment that is leased or rented by the customer from
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1 any source, wherein such charges are disaggregated and
2 separately identified from other charges;
3 (5) charges to business enterprises certified under
4 Section 9-222.1 of the Public Utilities Act to the extent
5 of such exemption and during the period of time specified
6 by the Department of Commerce and Community Affairs or by
7 the municipality imposing the fee under the Act, as the
8 context requires;
9 (6) charges for telecommunications and all services
10 and equipment provided in connection therewith between a
11 parent corporation and its wholly owned subsidiaries or
12 between wholly owned subsidiaries, and only to the extent
13 that the charges between the parent corporation and
14 wholly owned subsidiaries or between wholly owned
15 subsidiaries represent expense allocation between the
16 corporations and not the generation of profit other than
17 a regulatory required profit for the corporation
18 rendering such services;
19 (7) bad debts ("bad debt" means any portion of a
20 debt that is related to a sale at retail for which gross
21 charges are not otherwise deductible or excludable that
22 has become worthless or uncollectible, as determined
23 under applicable federal income tax standards; if the
24 portion of the debt deemed to be bad is subsequently
25 paid, the retailer shall report and pay the tax on that
26 portion during the reporting period in which the payment
27 is made);
28 (8) charges paid by inserting coins in
29 coin-operated telecommunication devices; or
30 (9) charges for telecommunications and all services
31 and equipment provided to a municipality imposing the
32 infrastructure maintenance fee.
33 (a-5) "Department" means the Illinois Department of
34 Revenue.
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1 (b) "Telecommunications" includes, but is not limited
2 to, messages or information transmitted through use of local,
3 toll, and wide area telephone service, channel services,
4 telegraph services, teletypewriter service, computer exchange
5 services, private line services, specialized mobile radio
6 services, or any other transmission of messages or
7 information by electronic or similar means, between or among
8 points by wire, cable, fiber optics, laser, microwave, radio,
9 satellite, or similar facilities. Unless the context clearly
10 requires otherwise, "telecommunications" shall also include
11 wireless telecommunications as hereinafter defined.
12 "Telecommunications" shall not include value added services
13 in which computer processing applications are used to act on
14 the form, content, code, and protocol of the information for
15 purposes other than transmission. "Telecommunications" shall
16 not include purchase of telecommunications by a
17 telecommunications service provider for use as a component
18 part of the service provided by him or her to the ultimate
19 retail consumer who originates or terminates the end-to-end
20 communications. Retailer access charges, right of access
21 charges, charges for use of intercompany facilities, and all
22 telecommunications resold in the subsequent provision and
23 used as a component of, or integrated into, end-to-end
24 telecommunications service shall not be included in gross
25 charges as sales for resale. "Telecommunications" shall not
26 include the provision of cable services through a cable
27 system as defined in the Cable Communications Act of 1984 (47
28 U.S.C. Sections 521 and following) as now or hereafter
29 amended or through an open video system as defined in the
30 Rules of the Federal Communications Commission (47 C.D.F.
31 76.1550 and following) as now or hereafter amended. Beginning
32 January 1, 2001, prepaid telephone calling arrangements shall
33 not be considered "telecommunications" subject to the tax
34 imposed under this Act. For purposes of this Section,
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1 "prepaid telephone calling arrangements" means that term as
2 defined in Section 2-27 of the Retailers' Occupation Tax Act.
3 (c) "Wireless telecommunications" includes cellular
4 mobile telephone services, personal wireless services as
5 defined in Section 704(C) of the Telecommunications Act of
6 1996 (Public Law No. 104-104) as now or hereafter amended,
7 including all commercial mobile radio services, and paging
8 services.
9 (d) "Telecommunications retailer" or "retailer" or
10 "carrier" means and includes every person engaged in the
11 business of making sales of telecommunications at retail as
12 defined in this Section. The Illinois Department of Revenue
13 or the municipality imposing the fee, as the case may be,
14 may, in its discretion, upon applications, authorize the
15 collection of the fee hereby imposed by any retailer not
16 maintaining a place of business within this State, who, to
17 the satisfaction of the Department or municipality, furnishes
18 adequate security to insure collection and payment of the
19 fee. When so authorized, it shall be the duty of such
20 retailer to pay the fee upon all of the gross charges for
21 telecommunications in the same manner and subject to the same
22 requirements as a retailer maintaining a place of business
23 within the State or municipality imposing the fee.
24 (e) "Retailer maintaining a place of business in this
25 State", or any like term, means and includes any retailer
26 having or maintaining within this State, directly or by a
27 subsidiary, an office, distribution facilities, transmission
28 facilities, sales office, warehouse, or other place of
29 business, or any agent or other representative operating
30 within this State under the authority of the retailer or its
31 subsidiary, irrespective of whether such place of business or
32 agent or other representative is located here permanently or
33 temporarily, or whether such retailer or subsidiary is
34 licensed to do business in this State.
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1 (f) "Sale of telecommunications at retail" means the
2 transmitting, supplying, or furnishing of telecommunications
3 and all services rendered in connection therewith for a
4 consideration, other than between a parent corporation and
5 its wholly owned subsidiaries or between wholly owned
6 subsidiaries, when the gross charge made by one such
7 corporation to another such corporation is not greater than
8 the gross charge paid to the retailer for their use or
9 consumption and not for sale.
10 (g) "Service address" means the location of
11 telecommunications equipment from which telecommunications
12 services are originated or at which telecommunications
13 services are received. If this is not a defined location, as
14 in the case of wireless telecommunications, paging systems,
15 maritime systems, air-to-ground systems, and the like,
16 "service address" shall mean the location of the customer's
17 primary use of the telecommunications equipment as defined by
18 the location in Illinois where bills are sent.
19 (Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97.)
20 (35 ILCS 635/20)
21 Sec. 20. Municipal telecommunications infrastructure
22 maintenance fee.
23 (a) A municipality may impose a municipal infrastructure
24 maintenance fee upon telecommunications retailers in an
25 amount specified in subsection (b). On and after the
26 effective date of this amendatory Act of 1997, a certified
27 copy of an ordinance or resolution imposing a fee under this
28 Section shall be filed with the Department within 30 days
29 after the effective date of this amendatory Act or the
30 effective date of the ordinance or resolution imposing such
31 fee, whichever is later. Failure to file a certified copy of
32 the ordinance or resolution imposing a fee under this Section
33 shall have no effect on the validity of the ordinance or
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1 resolution. The Department shall create and maintain a list
2 of all ordinances and resolutions filed pursuant to this
3 Section and make that list, as well as copies of the
4 ordinances and resolutions, available to the public for a
5 reasonable fee.
6 (b) The amount of the municipal infrastructure
7 maintenance fee imposed upon a telecommunications retailer
8 under this Section shall not exceed: (i) in a municipality
9 with a population of more than 500,000, 2.0% of all gross
10 charges charged by the telecommunications retailer to service
11 addresses in the municipality for telecommunications
12 originating or received in the municipality; and (ii) in a
13 municipality with a population of 500,000 or less, 1.0% of
14 all gross charges charged by the telecommunications retailer
15 to service addresses in the municipality for
16 telecommunications originating or received in the
17 municipality. If imposed, the municipal telecommunications
18 infrastructure fee must be in 1/4% increments. However, the
19 fee shall not be imposed in any case in which the imposition
20 of the fee would violate the Constitution or statutes of the
21 United States.
22 (c) The municipal telecommunications infrastructure fee
23 authorized by this Section shall be collected, enforced, and
24 administered as set forth in subsection (c) of Section 25 of
25 this Act.
26 (d) A municipality with a population of more than
27 500,000 that imposes a municipal infrastructure maintenance
28 fee under this Section may, by ordinance, exempt from the fee
29 all charges for the inbound toll-free telecommunications
30 service commonly known as "800", "877", or "888" or for a
31 similar service.
32 (Source: P.A. 90-154, eff. 1-1-98; 90-562, eff. 12-16-97.)
33 Section 35. The Illinois Municipal Code is amended by
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1 changing Sections 8-11-2 and 8-11-17 as follows:
2 (65 ILCS 5/8-11-2) (from Ch. 24, par. 8-11-2)
3 Sec. 8-11-2. The corporate authorities of any
4 municipality may tax any or all of the following occupations
5 or privileges:
6 1. Persons engaged in the business of transmitting
7 messages by means of electricity or radio magnetic waves,
8 or fiber optics, at a rate not to exceed 5% of the gross
9 receipts from that business originating within the
10 corporate limits of the municipality. Beginning January
11 1, 2001, prepaid telephone calling arrangements shall not
12 be considered "telecommunications" subject to the tax
13 imposed under this Act. For purposes of this Section,
14 "prepaid telephone calling arrangements" means that term
15 as defined in Section 2-27 of the Retailers' Occupation
16 Tax Act.
17 2. Persons engaged in the business of distributing,
18 supplying, furnishing, or selling gas for use or
19 consumption within the corporate limits of a municipality
20 of 500,000 or fewer population, and not for resale, at a
21 rate not to exceed 5% of the gross receipts therefrom.
22 2a. Persons engaged in the business of
23 distributing, supplying, furnishing, or selling gas for
24 use or consumption within the corporate limits of a
25 municipality of over 500,000 population, and not for
26 resale, at a rate not to exceed 8% of the gross receipts
27 therefrom. If imposed, this tax shall be paid in monthly
28 payments.
29 3. The privilege of using or consuming electricity
30 acquired in a purchase at retail and used or consumed
31 within the corporate limits of the municipality at rates
32 not to exceed the following maximum rates, calculated on
33 a monthly basis for each purchaser:
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1 (i) For the first 2,000 kilowatt-hours used or
2 consumed in a month; 0.61 cents per kilowatt-hour;
3 (ii) For the next 48,000 kilowatt-hours used or
4 consumed in a month; 0.40 cents per kilowatt-hour;
5 (iii) For the next 50,000 kilowatt-hours used or
6 consumed in a month; 0.36 cents per kilowatt-hour;
7 (iv) For the next 400,000 kilowatt-hours used or
8 consumed in a month; 0.35 cents per kilowatt-hour;
9 (v) For the next 500,000 kilowatt-hours used or
10 consumed in a month; 0.34 cents per kilowatt-hour;
11 (vi) For the next 2,000,000 kilowatt-hours used or
12 consumed in a month; 0.32 cents per kilowatt-hour;
13 (vii) For the next 2,000,000 kilowatt-hours used or
14 consumed in a month; 0.315 cents per kilowatt-hour;
15 (viii) For the next 5,000,000 kilowatt-hours used
16 or consumed in a month; 0.31 cents per kilowatt-hour;
17 (ix) For the next 10,000,000 kilowatt-hours used or
18 consumed in a month; 0.305 cents per kilowatt-hour; and
19 (x) For all electricity used or consumed in excess
20 of 20,000,000 kilowatt-hours in a month, 0.30 cents per
21 kilowatt-hour.
22 If a municipality imposes a tax at rates lower than
23 either the maximum rates specified in this Section or the
24 alternative maximum rates promulgated by the Illinois
25 Commerce Commission, as provided below, the tax rates
26 shall be imposed upon the kilowatt hour categories set
27 forth above with the same proportional relationship as
28 that which exists among such maximum rates.
29 Notwithstanding the foregoing, until December 31, 2008,
30 no municipality shall establish rates that are in excess
31 of rates reasonably calculated to produce revenues that
32 equal the maximum total revenues such municipality could
33 have received under the tax authorized by this
34 subparagraph in the last full calendar year prior to the
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1 effective date of Section 65 of this amendatory Act of
2 1997; provided that this shall not be a limitation on the
3 amount of tax revenues actually collected by such
4 municipality.
5 Upon the request of the corporate authorities of a
6 municipality, the Illinois Commerce Commission shall,
7 within 90 days after receipt of such request, promulgate
8 alternative rates for each of these kilowatt-hour
9 categories that will reflect, as closely as reasonably
10 practical for that municipality, the distribution of the
11 tax among classes of purchasers as if the tax were based
12 on a uniform percentage of the purchase price of
13 electricity. A municipality that has adopted an
14 ordinance imposing a tax pursuant to subparagraph 3 as it
15 existed prior to the effective date of Section 65 of this
16 amendatory Act of 1997 may, rather than imposing the tax
17 permitted by this amendatory Act of 1997, continue to
18 impose the tax pursuant to that ordinance with respect to
19 gross receipts received from residential customers
20 through July 31, 1999, and with respect to gross receipts
21 from any non-residential customer until the first bill
22 issued to such customer for delivery services in
23 accordance with Section 16-104 of the Public Utilities
24 Act but in no case later than the last bill issued to
25 such customer before December 31, 2000. No ordinance
26 imposing the tax permitted by this amendatory Act of 1997
27 shall be applicable to any non-residential customer until
28 the first bill issued to such customer for delivery
29 services in accordance with Section 16-104 of the Public
30 Utilities Act but in no case later than the last bill
31 issued to such non-residential customer before December
32 31, 2000.
33 4. Persons engaged in the business of distributing,
34 supplying, furnishing, or selling water for use or
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1 consumption within the corporate limits of the
2 municipality, and not for resale, at a rate not to exceed
3 5% of the gross receipts therefrom.
4 None of the taxes authorized by this Section may be
5 imposed with respect to any transaction in interstate
6 commerce or otherwise to the extent to which the business or
7 privilege may not, under the constitution and statutes of the
8 United States, be made the subject of taxation by this State
9 or any political sub-division thereof; nor shall any persons
10 engaged in the business of distributing, supplying,
11 furnishing, selling or transmitting gas, water, or
12 electricity, or engaged in the business of transmitting
13 messages, or using or consuming electricity acquired in a
14 purchase at retail, be subject to taxation under the
15 provisions of this Section for those transactions that are or
16 may become subject to taxation under the provisions of the
17 "Municipal Retailers' Occupation Tax Act" authorized by
18 Section 8-11-1; nor shall any tax authorized by this Section
19 be imposed upon any person engaged in a business or on any
20 privilege unless the tax is imposed in like manner and at the
21 same rate upon all persons engaged in businesses of the same
22 class in the municipality, whether privately or municipally
23 owned or operated, or exercising the same privilege within
24 the municipality.
25 Any of the taxes enumerated in this Section may be in
26 addition to the payment of money, or value of products or
27 services furnished to the municipality by the taxpayer as
28 compensation for the use of its streets, alleys, or other
29 public places, or installation and maintenance therein,
30 thereon or thereunder of poles, wires, pipes or other
31 equipment used in the operation of the taxpayer's business.
32 (a) If the corporate authorities of any home rule
33 municipality have adopted an ordinance that imposed a tax on
34 public utility customers, between July 1, 1971, and October
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1 1, 1981, on the good faith belief that they were exercising
2 authority pursuant to Section 6 of Article VII of the 1970
3 Illinois Constitution, that action of the corporate
4 authorities shall be declared legal and valid,
5 notwithstanding a later decision of a judicial tribunal
6 declaring the ordinance invalid. No municipality shall be
7 required to rebate, refund, or issue credits for any taxes
8 described in this paragraph, and those taxes shall be deemed
9 to have been levied and collected in accordance with the
10 Constitution and laws of this State.
11 (b) In any case in which (i) prior to October 19, 1979,
12 the corporate authorities of any municipality have adopted an
13 ordinance imposing a tax authorized by this Section (or by
14 the predecessor provision of the "Revised Cities and Villages
15 Act") and have explicitly or in practice interpreted gross
16 receipts to include either charges added to customers' bills
17 pursuant to the provision of paragraph (a) of Section 36 of
18 the Public Utilities Act or charges added to customers' bills
19 by taxpayers who are not subject to rate regulation by the
20 Illinois Commerce Commission for the purpose of recovering
21 any of the tax liabilities or other amounts specified in such
22 paragraph (a) of Section 36 of that Act, and (ii) on or after
23 October 19, 1979, a judicial tribunal has construed gross
24 receipts to exclude all or part of those charges, then
25 neither those municipality nor any taxpayer who paid the tax
26 shall be required to rebate, refund, or issue credits for any
27 tax imposed or charge collected from customers pursuant to
28 the municipality's interpretation prior to October 19, 1979.
29 This paragraph reflects a legislative finding that it would
30 be contrary to the public interest to require a municipality
31 or its taxpayers to refund taxes or charges attributable to
32 the municipality's more inclusive interpretation of gross
33 receipts prior to October 19, 1979, and is not intended to
34 prescribe or limit judicial construction of this Section. The
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1 legislative finding set forth in this subsection does not
2 apply to taxes imposed after the effective date of this
3 amendatory Act of 1995.
4 (c) The tax authorized by subparagraph 3 shall be
5 collected from the purchaser by the person maintaining a
6 place of business in this State who delivers the electricity
7 to the purchaser. This tax shall constitute a debt of the
8 purchaser to the person who delivers the electricity to the
9 purchaser and if unpaid, is recoverable in the same manner as
10 the original charge for delivering the electricity. Any tax
11 required to be collected pursuant to an ordinance authorized
12 by subparagraph 3 and any such tax collected by a person
13 delivering electricity shall constitute a debt owed to the
14 municipality by such person delivering the electricity,
15 provided, that the person delivering electricity shall be
16 allowed credit for such tax related to deliveries of
17 electricity the charges for which are written off as
18 uncollectible, and provided further, that if such charges are
19 thereafter collected, the delivering supplier shall be
20 obligated to remit such tax. For purposes of this subsection
21 (c), any partial payment not specifically identified by the
22 purchaser shall be deemed to be for the delivery of
23 electricity. Persons delivering electricity shall collect the
24 tax from the purchaser by adding such tax to the gross charge
25 for delivering the electricity, in the manner prescribed by
26 the municipality. Persons delivering electricity shall also
27 be authorized to add to such gross charge an amount equal to
28 3% of the tax to reimburse the person delivering electricity
29 for the expenses incurred in keeping records, billing
30 customers, preparing and filing returns, remitting the tax
31 and supplying data to the municipality upon request. If the
32 person delivering electricity fails to collect the tax from
33 the purchaser, then the purchaser shall be required to pay
34 the tax directly to the municipality in the manner prescribed
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1 by the municipality. Persons delivering electricity who file
2 returns pursuant to this paragraph (c) shall, at the time of
3 filing such return, pay the municipality the amount of the
4 tax collected pursuant to subparagraph 3.
5 (d) For the purpose of the taxes enumerated in this
6 Section:
7 "Gross receipts" means the consideration received for the
8 transmission of messages, the consideration received for
9 distributing, supplying, furnishing or selling gas for use or
10 consumption and not for resale, and the consideration
11 received for distributing, supplying, furnishing or selling
12 water for use or consumption and not for resale, and for all
13 services rendered in connection therewith valued in money,
14 whether received in money or otherwise, including cash,
15 credit, services and property of every kind and material and
16 for all services rendered therewith, and shall be determined
17 without any deduction on account of the cost of transmitting
18 such messages, without any deduction on account of the cost
19 of the service, product or commodity supplied, the cost of
20 materials used, labor or service cost, or any other expenses
21 whatsoever. "Gross receipts" shall not include that portion
22 of the consideration received for distributing, supplying,
23 furnishing, or selling gas or water to, or for the
24 transmission of messages for, business enterprises described
25 in paragraph (e) of this Section to the extent and during the
26 period in which the exemption authorized by paragraph (e) is
27 in effect or for school districts or units of local
28 government described in paragraph (f) during the period in
29 which the exemption authorized in paragraph (f) is in effect.
30 "Gross receipts" shall not include amounts paid by
31 telecommunications retailers under the Telecommunications
32 Municipal Infrastructure Maintenance Fee Act.
33 For utility bills issued on or after May 1, 1996, but
34 before May 1, 1997, and for receipts from those utility
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1 bills, "gross receipts" does not include one-third of (i)
2 amounts added to customers' bills under Section 9-222 of the
3 Public Utilities Act, or (ii) amounts added to customers'
4 bills by taxpayers who are not subject to rate regulation by
5 the Illinois Commerce Commission for the purpose of
6 recovering any of the tax liabilities described in Section
7 9-222 of the Public Utilities Act. For utility bills issued
8 on or after May 1, 1997, but before May 1, 1998, and for
9 receipts from those utility bills, "gross receipts" does not
10 include two-thirds of (i) amounts added to customers' bills
11 under Section 9-222 of the Public Utilities Act, or (ii)
12 amount added to customers' bills by taxpayers who are not
13 subject to rate regulation by the Illinois Commerce
14 Commission for the purpose of recovering any of the tax
15 liabilities described in Section 9-222 of the Public
16 Utilities Act. For utility bills issued on or after May 1,
17 1998, and for receipts from those utility bills, "gross
18 receipts" does not include (i) amounts added to customers'
19 bills under Section 9-222 of the Public Utilities Act, or
20 (ii) amounts added to customers' bills by taxpayers who are
21 not subject to rate regulation by the Illinois Commerce
22 Commission for the purpose of recovering any of the tax
23 liabilities described in Section 9-222 of the Public
24 Utilities Act.
25 For purposes of this Section "gross receipts" shall not
26 include (i) amounts added to customers' bills under Section
27 9-221 of the Public Utilities Act, or (ii) charges added to
28 customers' bills to recover the surcharge imposed under the
29 Emergency Telephone System Act. This paragraph is not
30 intended to nor does it make any change in the meaning of
31 "gross receipts" for the purposes of this Section, but is
32 intended to remove possible ambiguities, thereby confirming
33 the existing meaning of "gross receipts" prior to the
34 effective date of this amendatory Act of 1995.
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1 The words "transmitting messages", in addition to the
2 usual and popular meaning of person to person communication,
3 shall include the furnishing, for a consideration, of
4 services or facilities (whether owned or leased), or both, to
5 persons in connection with the transmission of messages where
6 those persons do not, in turn, receive any consideration in
7 connection therewith, but shall not include such furnishing
8 of services or facilities to persons for the transmission of
9 messages to the extent that any such services or facilities
10 for the transmission of messages are furnished for a
11 consideration, by those persons to other persons, for the
12 transmission of messages.
13 "Person" as used in this Section means any natural
14 individual, firm, trust, estate, partnership, association,
15 joint stock company, joint adventure, corporation, limited
16 liability company, municipal corporation, the State or any of
17 its political subdivisions, any State university created by
18 statute, or a receiver, trustee, guardian or other
19 representative appointed by order of any court.
20 "Person maintaining a place of business in this State"
21 shall mean any person having or maintaining within this
22 State, directly or by a subsidiary or other affiliate, an
23 office, generation facility, distribution facility,
24 transmission facility, sales office or other place of
25 business, or any employee, agent, or other representative
26 operating within this State under the authority of the person
27 or its subsidiary or other affiliate, irrespective of whether
28 such place of business or agent or other representative is
29 located in this State permanently or temporarily, or whether
30 such person, subsidiary or other affiliate is licensed or
31 qualified to do business in this State.
32 "Public utility" shall have the meaning ascribed to it in
33 Section 3-105 of the Public Utilities Act and shall include
34 telecommunications carriers as defined in Section 13-202 of
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1 that Act and alternative retail electric suppliers as defined
2 in Section 16-102 of that Act.
3 "Purchase at retail" shall mean any acquisition of
4 electricity by a purchaser for purposes of use or
5 consumption, and not for resale, but shall not include the
6 use of electricity by a public utility directly in the
7 generation, production, transmission, delivery or sale of
8 electricity.
9 "Purchaser" shall mean any person who uses or consumes,
10 within the corporate limits of the municipality, electricity
11 acquired in a purchase at retail.
12 In the case of persons engaged in the business of
13 transmitting messages through the use of mobile equipment,
14 such as cellular phones and paging systems, the gross
15 receipts from the business shall be deemed to originate
16 within the corporate limits of a municipality only if the
17 address to which the bills for the service are sent is within
18 those corporate limits. If, however, that address is not
19 located within a municipality that imposes a tax under this
20 Section, then (i) if the party responsible for the bill is
21 not an individual, the gross receipts from the business shall
22 be deemed to originate within the corporate limits of the
23 municipality where that party's principal place of business
24 in Illinois is located, and (ii) if the party responsible for
25 the bill is an individual, the gross receipts from the
26 business shall be deemed to originate within the corporate
27 limits of the municipality where that party's principal
28 residence in Illinois is located.
29 (e) Any municipality that imposes taxes upon public
30 utilities or upon the privilege of using or consuming
31 electricity pursuant to this Section whose territory includes
32 any part of an enterprise zone or federally designated
33 Foreign Trade Zone or Sub-Zone may, by a majority vote of its
34 corporate authorities, exempt from those taxes for a period
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1 not exceeding 20 years any specified percentage of gross
2 receipts of public utilities received from, or electricity
3 used or consumed by, business enterprises that:
4 (1) either (i) make investments that cause the
5 creation of a minimum of 200 full-time equivalent jobs in
6 Illinois, (ii) make investments of at least $175,000,000
7 that cause the creation of a minimum of 150 full-time
8 equivalent jobs in Illinois, or (iii) make investments
9 that cause the retention of a minimum of 1,000 full-time
10 jobs in Illinois; and
11 (2) are either (i) located in an Enterprise Zone
12 established pursuant to the Illinois Enterprise Zone Act
13 or (ii) Department of Commerce and Community Affairs
14 designated High Impact Businesses located in a federally
15 designated Foreign Trade Zone or Sub-Zone; and
16 (3) are certified by the Department of Commerce and
17 Community Affairs as complying with the requirements
18 specified in clauses (1) and (2) of this paragraph (e).
19 Upon adoption of the ordinance authorizing the exemption,
20 the municipal clerk shall transmit a copy of that ordinance
21 to the Department of Commerce and Community Affairs. The
22 Department of Commerce and Community Affairs shall determine
23 whether the business enterprises located in the municipality
24 meet the criteria prescribed in this paragraph. If the
25 Department of Commerce and Community Affairs determines that
26 the business enterprises meet the criteria, it shall grant
27 certification. The Department of Commerce and Community
28 Affairs shall act upon certification requests within 30 days
29 after receipt of the ordinance.
30 Upon certification of the business enterprise by the
31 Department of Commerce and Community Affairs, the Department
32 of Commerce and Community Affairs shall notify the Department
33 of Revenue of the certification. The Department of Revenue
34 shall notify the public utilities of the exemption status of
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1 the gross receipts received from, and the electricity used or
2 consumed by, the certified business enterprises. Such
3 exemption status shall be effective within 3 months after
4 certification.
5 (f) A municipality that imposes taxes upon public
6 utilities or upon the privilege of using or consuming
7 electricity under this Section and whose territory includes
8 part of another unit of local government or a school district
9 may by ordinance exempt the other unit of local government or
10 school district from those taxes.
11 (g) The amendment of this Section by Public Act 84-127
12 shall take precedence over any other amendment of this
13 Section by any other amendatory Act passed by the 84th
14 General Assembly before the effective date of Public Act
15 84-127.
16 (h) In any case in which, before July 1, 1992, a person
17 engaged in the business of transmitting messages through the
18 use of mobile equipment, such as cellular phones and paging
19 systems, has determined the municipality within which the
20 gross receipts from the business originated by reference to
21 the location of its transmitting or switching equipment, then
22 (i) neither the municipality to which tax was paid on that
23 basis nor the taxpayer that paid tax on that basis shall be
24 required to rebate, refund, or issue credits for any such tax
25 or charge collected from customers to reimburse the taxpayer
26 for the tax and (ii) no municipality to which tax would have
27 been paid with respect to those gross receipts if the
28 provisions of this amendatory Act of 1991 had been in effect
29 before July 1, 1992, shall have any claim against the
30 taxpayer for any amount of the tax.
31 (Source: P.A. 89-325, eff. 1-1-96; 90-16, eff. 6-16-97;
32 90-561, eff. 8-1-98; 90-562, eff. 12-16-97; 90-655, eff.
33 7-30-98.)
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1 (65 ILCS 5/8-11-17) (from Ch. 24, par. 8-11-17)
2 Sec. 8-11-17. Municipal telecommunications tax.
3 (a) Beginning on the effective date of this amendatory
4 Act of 1991, the corporate authorities of any municipality in
5 this State may tax any or all of the following acts or
6 privileges:
7 (1) The act or privilege of originating in such
8 municipality or receiving in such municipality intrastate
9 telecommunications by a person at a rate not to exceed 5%
10 of the gross charge for such telecommunications purchased
11 at retail from a retailer by such person. However, such
12 tax is not imposed on such act or privilege to the extent
13 such act or privilege may not, under the Constitution and
14 statutes of the United States, be made the subject of
15 taxation by municipalities in this State.
16 (2) The act or privilege of originating in such
17 municipality or receiving in such municipality interstate
18 telecommunications by a person at a rate not to exceed 5%
19 of the gross charge for such telecommunications purchased
20 at retail from a retailer by such person. To prevent
21 actual multi-state taxation of the act or privilege that
22 is subject to taxation under this paragraph, any
23 taxpayer, upon proof that the taxpayer has paid a tax in
24 another state on such event, shall be allowed a credit
25 against any tax enacted pursuant to an ordinance
26 authorized by this paragraph to the extent of the amount
27 of such tax properly due and paid in such other state
28 which was not previously allowed as a credit against any
29 other state or local tax in this State. However, such
30 tax is not imposed on the act or privilege to the extent
31 such act or privilege may not, under the Constitution and
32 statutes of the United States, be made the subject of
33 taxation by municipalities in this State.
34 (3) The taxes authorized by paragraphs (1) and (2)
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1 of subsection (a) of this Section may only be levied if
2 such municipality does not then have in effect an
3 occupation tax imposed on persons engaged in the business
4 of transmitting messages by means of electricity as
5 authorized by Section 8-11-2 of the Illinois Municipal
6 Code.
7 (b) The tax authorized by this Section shall be
8 collected from the taxpayer by a retailer maintaining a place
9 of business in this State and making or effectuating the sale
10 at retail and shall be remitted by such retailer to the
11 municipality. Any tax required to be collected pursuant to
12 an ordinance authorized by this Section and any such tax
13 collected by such retailer shall constitute a debt owed by
14 the retailer to such municipality. Retailers shall collect
15 the tax from the taxpayer by adding the tax to the gross
16 charge for the act or privilege of originating or receiving
17 telecommunications when sold for use, in the manner
18 prescribed by the municipality. The tax authorized by this
19 Section shall constitute a debt of the purchaser to the
20 retailer who provides such taxable services until paid and,
21 if unpaid, is recoverable at law in the same manner as the
22 original charge for such taxable services. If the retailer
23 fails to collect the tax from the taxpayer, then the taxpayer
24 shall be required to pay the tax directly to the municipality
25 in the manner provided by the municipality. The municipality
26 imposing the tax shall provide for its administration and
27 enforcement.
28 Beginning January 1, 1994, retailers filing tax returns
29 pursuant to this Section shall, at the time of filing such
30 return, pay to the municipality the amount of the tax imposed
31 by this Section, less a commission of 1.75% which is allowed
32 to reimburse the retailer for the expenses incurred in
33 keeping records, billing the customer, preparing and filing
34 returns, remitting the tax and supplying data to the
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1 municipality upon request. No commission may be claimed by a
2 retailer for tax not timely remitted to the municipality.
3 Whenever possible, the tax authorized by this Section
4 shall, when collected, be stated as a distinct item separate
5 and apart from the gross charge for telecommunications.
6 (c) For the purpose of the taxes authorized by this
7 Section:
8 (1) "Amount paid" means the amount charged to the
9 taxpayer's service address in such municipality
10 regardless of where such amount is billed or paid.
11 (2) "Gross charge" means the amount paid for the
12 act or privilege of originating or receiving
13 telecommunications in such municipality and for all
14 services rendered in connection therewith, valued in
15 money whether paid in money or otherwise, including cash,
16 credits, services and property of every kind or nature,
17 and shall be determined without any deduction on account
18 of the cost of such telecommunications, the cost of the
19 materials used, labor or service costs or any other
20 expense whatsoever. In case credit is extended, the
21 amount thereof shall be included only as and when paid.
22 However, "gross charge" shall not include:
23 (A) any amounts added to a purchaser's bill
24 because of a charge made pursuant to: (i) the tax
25 imposed by this Section, (ii) additional charges
26 added to a purchaser's bill pursuant to Section
27 9-222 of the Public Utilities Act, (iii) the tax
28 imposed by the Telecommunications Excise Tax Act, or
29 (iv) the tax imposed by Section 4251 of the Internal
30 Revenue Code;
31 (B) charges for a sent collect
32 telecommunication received outside of such
33 municipality;
34 (C) charges for leased time on equipment or
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1 charges for the storage of data or information or
2 subsequent retrieval or the processing of data or
3 information intended to change its form or content.
4 Such equipment includes, but is not limited to, the
5 use of calculators, computers, data processing
6 equipment, tabulating equipment or accounting
7 equipment and also includes the usage of computers
8 under a time-sharing agreement;
9 (D) charges for customer equipment, including
10 such equipment that is leased or rented by the
11 customer from any source, wherein such charges are
12 disaggregated and separately identified from other
13 charges;
14 (E) charges to business enterprises certified
15 under Section 9-222.1 of the Public Utilities Act to
16 the extent of such exemption and during the period
17 of time specified by the Department of Commerce and
18 Community Affairs;
19 (F) charges for telecommunications and all
20 services and equipment provided in connection
21 therewith between a parent corporation and its
22 wholly owned subsidiaries or between wholly owned
23 subsidiaries when the tax imposed under this Section
24 has already been paid to a retailer and only to the
25 extent that the charges between the parent
26 corporation and wholly owned subsidiaries or between
27 wholly owned subsidiaries represent expense
28 allocation between the corporations and not the
29 generation of profit for the corporation rendering
30 such service;
31 (G) bad debts ("bad debt" means any portion of
32 a debt that is related to a sale at retail for which
33 gross charges are not otherwise deductible or
34 excludable that has become worthless or
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1 uncollectable, as determined under applicable
2 federal income tax standards; if the portion of the
3 debt deemed to be bad is subsequently paid, the
4 retailer shall report and pay the tax on that
5 portion during the reporting period in which the
6 payment is made);
7 (H) charges paid by inserting coins in
8 coin-operated telecommunication devices; or
9 (I) amounts paid by telecommunications
10 retailers under the Telecommunications Municipal
11 Infrastructure Maintenance Fee Act.
12 (3) "Interstate telecommunications" means all
13 telecommunications that either originate or terminate
14 outside this State.
15 (4) "Intrastate telecommunications" means all
16 telecommunications that originate and terminate within
17 this State.
18 (5) "Person" means any natural individual, firm,
19 trust, estate, partnership, association, joint stock
20 company, joint venture, corporation, limited liability
21 company, or a receiver, trustee, guardian or other
22 representative appointed by order of any court, the
23 Federal and State governments, including State
24 universities created by statute, or any city, town,
25 county, or other political subdivision of this State.
26 (6) "Purchase at retail" means the acquisition,
27 consumption or use of telecommunications through a sale
28 at retail.
29 (7) "Retailer" means and includes every person
30 engaged in the business of making sales at retail as
31 defined in this Section. A municipality may, in its
32 discretion, upon application, authorize the collection of
33 the tax hereby imposed by any retailer not maintaining a
34 place of business within this State, who to the
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1 satisfaction of the municipality, furnishes adequate
2 security to insure collection and payment of the tax.
3 Such retailer shall be issued, without charge, a permit
4 to collect such tax. When so authorized, it shall be the
5 duty of such retailer to collect the tax upon all of the
6 gross charges for telecommunications in such municipality
7 in the same manner and subject to the same requirements
8 as a retailer maintaining a place of business within such
9 municipality.
10 (8) "Retailer maintaining a place of business in
11 this State", or any like term, means and includes any
12 retailer having or maintaining within this State,
13 directly or by a subsidiary, an office, distribution
14 facilities, transmission facilities, sales office,
15 warehouse or other place of business, or any agent or
16 other representative operating within this State under
17 the authority of the retailer or its subsidiary,
18 irrespective of whether such place of business or agent
19 or other representative is located here permanently or
20 temporarily, or whether such retailer or subsidiary is
21 licensed to do business in this State.
22 (9) "Sale at retail" means the transmitting,
23 supplying or furnishing of telecommunications and all
24 services rendered in connection therewith for a
25 consideration, to persons other than the Federal and
26 State governments, and State universities created by
27 statute and other than between a parent corporation and
28 its wholly owned subsidiaries or between wholly owned
29 subsidiaries, when the tax has already been paid to a
30 retailer and the gross charge made by one such
31 corporation to another such corporation is not greater
32 than the gross charge paid to the retailer for their use
33 or consumption and not for resale.
34 (10) "Service address" means the location of
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1 telecommunications equipment from which
2 telecommunications services are originated or at which
3 telecommunications services are received by a taxpayer.
4 If this is not a defined location, as in the case of
5 mobile phones, paging systems, maritime systems,
6 air-to-ground systems and the like, "service address"
7 shall mean the location of a taxpayer's primary use of
8 the telecommunication equipment as defined by telephone
9 number, authorization code, or location in Illinois where
10 bills are sent.
11 (11) "Taxpayer" means a person who individually or
12 through his agents, employees, or permittees engages in
13 the act or privilege of originating in such municipality
14 or receiving in such municipality telecommunications and
15 who incurs a tax liability under any ordinance authorized
16 by this Section.
17 (12) "Telecommunications", in addition to the usual
18 and popular meaning, includes, but is not limited to,
19 messages or information transmitted through use of local,
20 toll and wide area telephone service, channel services,
21 telegraph services, teletypewriter service, computer
22 exchange services; cellular mobile telecommunications
23 service, specialized mobile radio services, paging
24 service, or any other form of mobile and portable one-way
25 or two-way communications, or any other transmission of
26 messages or information by electronic or similar means,
27 between or among points by wire, cable, fiber optics,
28 laser, microwave, radio, satellite or similar facilities.
29 The definition of "telecommunications" shall not include
30 value added services in which computer processing
31 applications are used to act on the form, content, code
32 and protocol of the information for purposes other than
33 transmission. "Telecommunications" shall not include
34 purchase of telecommunications by a telecommunications
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1 service provider for use as a component part of the
2 service provided by him to the ultimate retail consumer
3 who originates or terminates the taxable end-to-end
4 communications. Carrier access charges, right of access
5 charges, charges for use of inter-company facilities, and
6 all telecommunications resold in the subsequent provision
7 used as a component of, or integrated into, end-to-end
8 telecommunications service shall be non-taxable as sales
9 for resale. Beginning January 1, 2001, prepaid telephone
10 calling arrangements shall not be considered
11 "telecommunications" subject to the tax imposed under
12 this Act. For purposes of this Section, "prepaid
13 telephone calling arrangements" means that term as
14 defined in Section 2-27 of the Retailers' Occupation Tax
15 Act.
16 (d) If a person, who originates or receives
17 telecommunications in such municipality claims to be a
18 reseller of such telecommunications, such person shall apply
19 to the municipality for a resale number. Such applicant
20 shall state facts which will show the municipality why such
21 applicant is not liable for tax under any ordinance
22 authorized by this Section on any of such purchases and shall
23 furnish such additional information as the municipality may
24 reasonably require.
25 Upon approval of the application, the municipality shall
26 assign a resale number to the applicant and shall certify
27 such number to the applicant. The municipality may cancel
28 any number which is obtained through misrepresentation, or
29 which is used to send or receive such telecommunication
30 tax-free when such actions in fact are not for resale, or
31 which no longer applies because of the person's having
32 discontinued the making of resales.
33 Except as provided hereinabove in this Section, the act
34 or privilege of sending or receiving telecommunications in
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1 this State shall not be made tax-free on the ground of being
2 a sale for resale unless the person has an active resale
3 number from the municipality and furnishes that number to the
4 retailer in connection with certifying to the retailer that
5 any sale to such person is non-taxable because of being a
6 sale for resale.
7 (e) A municipality that imposes taxes upon
8 telecommunications under this Section and whose territory
9 includes part of another unit of local government or a school
10 district may, by ordinance, exempt the other unit of local
11 government or school district from those taxes.
12 (f) A municipality that imposes taxes upon
13 telecommunications under this Section may, by ordinance, (i)
14 reduce the rate of the tax for persons 65 years of age or
15 older or (ii) exempt persons 65 years of age or older from
16 those taxes. Taxes related to such rate reductions or
17 exemptions shall be rebated from the municipality directly to
18 persons qualified for the rate reduction or exemption as
19 determined by the municipality's ordinance.
20 (g) A municipality with a population of more than
21 500,000 that imposes a tax under this Section may, by
22 ordinance, exempt from the tax all charges for the inbound
23 toll-free telecommunications service commonly known as "800",
24 "877", or "888" or for a similar service.
25 (Source: P.A. 90-357, eff. 1-1-98; 90-562, eff. 12-16-97.)
26 Section 90. The State Mandates Act is amended by adding
27 Section 8.24 as follows:
28 (30 ILCS 805/8.24 new)
29 Sec. 8.24. Exempt mandate. Notwithstanding Sections 6
30 and 8 of this Act, no reimbursement by the State is required
31 for the implementation of any mandate created by this
32 amendatory Act of the 91st General Assembly.
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1 Section 99. Effective date. This Act takes effect upon
2 becoming law.
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1 INDEX
2 Statutes amended in order of appearance
3 35 ILCS 105/3 from Ch. 120, par. 439.3
4 35 ILCS 105/3-27 new
5 35 ILCS 110/3 from Ch. 120, par. 439.33
6 35 ILCS 110/3-27 new
7 35 ILCS 115/3 from Ch. 120, par. 439.103
8 35 ILCS 115/3-27 new
9 35 ILCS 120/2 from Ch. 120, par. 441
10 35 ILCS 120/2-27 new
11 35 ILCS 630/2 from Ch. 120, par. 2002
12 35 ILCS 630/3 from Ch. 120, par. 2003
13 35 ILCS 630/6 from Ch. 120, par. 2006
14 35 ILCS 635/10
15 35 ILCS 635/20
16 65 ILCS 5/8-11-2 from Ch. 24, par. 8-11-2
17 65 ILCS 5/8-11-17 from Ch. 24, par. 8-11-17
18 30 ILCS 805/8.24 new