Illinois-2021-HB5251-Introduced

102ND GENERAL ASSEMBLY State of Illinois 2021 and 2022 HB5251

Introduced , by Rep. Keith R. Wheeler

SYNOPSIS AS INTRODUCED:

`35 ILCS 105/3-55`	`from Ch. 120, par. 439.3-55`
`35 ILCS 110/3-45`	`from Ch. 120, par. 439.33-45`
`35 ILCS 115/3-5`
`35 ILCS 120/2-5`

Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that

the exemption for the use or sale of tangible personal property
purchased

from an Illinois retailer by a taxpayer engaged in centralized
purchasing

activities in Illinois who will temporarily store the property in Illinois

(i) for the purpose of
subsequently transporting it outside this State for

use or consumption solely outside this State or (ii) for the purpose of

being
processed, fabricated, or manufactured into, attached to, or

incorporated into
other tangible personal property to be transported

outside this State and used or consumed solely outside this State sunsets on June 30, 2023 (currently, June 30, 2016). Effective immediately.

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A BILL FOR

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1 AN ACT concerning revenue.

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 Section

5 3-55 as follows:

6 (35 ILCS 105/3-55) (from Ch. 120, par. 439.3-55)

7 Sec. 3-55. Multistate exemption. To prevent actual or

8 likely multistate taxation, the tax imposed by this Act does

9 not apply to the use of tangible personal property in this

10 State under the following circumstances:

11 (a) The use, in this State, of tangible personal property

12 acquired outside this State by a nonresident individual and

13 brought into this State by the individual for his or her own

14 use while temporarily within this State or while passing

15 through this State.

16 (b) (Blank).

17 (c) The use, in this State, by owners, lessors, or

18 shippers of tangible personal property that is utilized by

19 interstate carriers for hire for use as rolling stock moving

20 in interstate commerce as long as so used by the interstate

21 carriers for hire, and equipment operated by a

22 telecommunications provider, licensed as a common carrier by

23 the Federal Communications Commission, which is permanently

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1 installed in or affixed to aircraft moving in interstate

2 commerce.

3 (d) The use, in this State, of tangible personal property

4 that is acquired outside this State and caused to be brought

5 into this State by a person who has already paid a tax in

6 another State in respect to the sale, purchase, or use of that

7 property, to the extent of the amount of the tax properly due

8 and paid in the other State.

9 (e) The temporary storage, in this State, of tangible

10 personal property that is acquired outside this State and

11 that, after being brought into this State and stored here

12 temporarily, is used solely outside this State or is

13 physically attached to or incorporated into other tangible

14 personal property that is used solely outside this State, or

15 is altered by converting, fabricating, manufacturing,

16 printing, processing, or shaping, and, as altered, is used

17 solely outside this State.

18 (f) The temporary storage in this State of building

19 materials and fixtures that are acquired either in this State

20 or outside this State by an Illinois registered combination

21 retailer and construction contractor, and that the purchaser

22 thereafter uses outside this State by incorporating that

23 property into real estate located outside this State.

24 (g) The use or purchase of tangible personal property by a

25 common carrier by rail or motor that receives the physical

26 possession of the property in Illinois, and that transports

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1 the property, or shares with another common carrier in the

2 transportation of the property, out of Illinois on a standard

3 uniform bill of lading showing the seller of the property as

4 the shipper or consignor of the property to a destination

5 outside Illinois, for use outside Illinois.

6 (h) Except as provided in subsection (h-1), the use, in

7 this State, of a motor vehicle that was sold in this State to a

8 nonresident, even though the motor vehicle is delivered to the

9 nonresident in this State, if the motor vehicle is not to be

10 titled in this State, and if a drive-away permit is issued to

11 the motor vehicle as provided in Section 3-603 of the Illinois

12 Vehicle Code or if the nonresident purchaser has vehicle

13 registration plates to transfer to the motor vehicle upon

14 returning to his or her home state. The issuance of the

15 drive-away permit or having the out-of-state registration

16 plates to be transferred shall be prima facie evidence that

17 the motor vehicle will not be titled in this State.

18 (h-1) The exemption under subsection (h) does not apply if

19 the state in which the motor vehicle will be titled does not

20 allow a reciprocal exemption for the use in that state of a

21 motor vehicle sold and delivered in that state to an Illinois

22 resident but titled in Illinois. The tax collected under this

23 Act on the sale of a motor vehicle in this State to a resident

24 of another state that does not allow a reciprocal exemption

25 shall be imposed at a rate equal to the state's rate of tax on

26 taxable property in the state in which the purchaser is a

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1 resident, except that the tax shall not exceed the tax that

2 would otherwise be imposed under this Act. At the time of the

3 sale, the purchaser shall execute a statement, signed under

4 penalty of perjury, of his or her intent to title the vehicle

5 in the state in which the purchaser is a resident within 30

6 days after the sale and of the fact of the payment to the State

7 of Illinois of tax in an amount equivalent to the state's rate

8 of tax on taxable property in his or her state of residence and

9 shall submit the statement to the appropriate tax collection

10 agency in his or her state of residence. In addition, the

11 retailer must retain a signed copy of the statement in his or

12 her records. Nothing in this subsection shall be construed to

13 require the removal of the vehicle from this state following

14 the filing of an intent to title the vehicle in the purchaser's

15 state of residence if the purchaser titles the vehicle in his

16 or her state of residence within 30 days after the date of

17 sale. The tax collected under this Act in accordance with this

18 subsection (h-1) shall be proportionately distributed as if

19 the tax were collected at the 6.25% general rate imposed under

20 this Act.

21 (h-2) The following exemptions apply with respect to

22 certain aircraft:

23 (1) Beginning on July 1, 2007, no tax is imposed under

24 this Act on the purchase of an aircraft, as defined in

25 Section 3 of the Illinois Aeronautics Act, if all of the

26 following conditions are met:

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1 (A) the aircraft leaves this State within 15 days

2 after the later of either the issuance of the final

3 billing for the purchase of the aircraft or the

4 authorized approval for return to service, completion

5 of the maintenance record entry, and completion of the

6 test flight and ground test for inspection, as

7 required by 14 C.F.R. 91.407;

8 (B) the aircraft is not based or registered in

9 this State after the purchase of the aircraft; and

10 (C) the purchaser provides the Department with a

11 signed and dated certification, on a form prescribed

12 by the Department, certifying that the requirements of

13 this item (1) are met. The certificate must also

14 include the name and address of the purchaser, the

15 address of the location where the aircraft is to be

16 titled or registered, the address of the primary

17 physical location of the aircraft, and other

18 information that the Department may reasonably

19 require.

20 (2) Beginning on July 1, 2007, no tax is imposed under

21 this Act on the use of an aircraft, as defined in Section 3

22 of the Illinois Aeronautics Act, that is temporarily

23 located in this State for the purpose of a prepurchase

24 evaluation if all of the following conditions are met:

25 (A) the aircraft is not based or registered in

26 this State after the prepurchase evaluation; and

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1 (B) the purchaser provides the Department with a

2 signed and dated certification, on a form prescribed

3 by the Department, certifying that the requirements of

4 this item (2) are met. The certificate must also

5 include the name and address of the purchaser, the

6 address of the location where the aircraft is to be

7 titled or registered, the address of the primary

8 physical location of the aircraft, and other

9 information that the Department may reasonably

10 require.

11 (3) Beginning on July 1, 2007, no tax is imposed under

12 this Act on the use of an aircraft, as defined in Section 3

13 of the Illinois Aeronautics Act, that is temporarily

14 located in this State for the purpose of a post-sale

15 customization if all of the following conditions are met:

16 (A) the aircraft leaves this State within 15 days

17 after the authorized approval for return to service,

18 completion of the maintenance record entry, and

19 completion of the test flight and ground test for

20 inspection, as required by 14 C.F.R. 91.407;

21 (B) the aircraft is not based or registered in

22 this State either before or after the post-sale

23 customization; and

24 (C) the purchaser provides the Department with a

25 signed and dated certification, on a form prescribed

26 by the Department, certifying that the requirements of

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1 this item (3) are met. The certificate must also

2 include the name and address of the purchaser, the

3 address of the location where the aircraft is to be

4 titled or registered, the address of the primary

5 physical location of the aircraft, and other

6 information that the Department may reasonably

7 require.

8 If tax becomes due under this subsection (h-2) because of

9 the purchaser's use of the aircraft in this State, the

10 purchaser shall file a return with the Department and pay the

11 tax on the fair market value of the aircraft. This return and

12 payment of the tax must be made no later than 30 days after the

13 aircraft is used in a taxable manner in this State. The tax is

14 based on the fair market value of the aircraft on the date that

15 it is first used in a taxable manner in this State.

16 For purposes of this subsection (h-2):

17 "Based in this State" means hangared, stored, or otherwise

18 used, excluding post-sale customizations as defined in this

19 Section, for 10 or more days in each 12-month period

20 immediately following the date of the sale of the aircraft.

21 "Post-sale customization" means any improvement,

22 maintenance, or repair that is performed on an aircraft

23 following a transfer of ownership of the aircraft.

24 "Prepurchase evaluation" means an examination of an

25 aircraft to provide a potential purchaser with information

26 relevant to the potential purchase.

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1 "Registered in this State" means an aircraft registered

2 with the Department of Transportation, Aeronautics Division,

3 or titled or registered with the Federal Aviation

4 Administration to an address located in this State.

5 This subsection (h-2) is exempt from the provisions of

6 Section 3-90.

7 (i) Beginning July 1, 1999, the use, in this State, of fuel

8 acquired outside this State and brought into this State in the

9 fuel supply tanks of locomotives engaged in freight hauling

10 and passenger service for interstate commerce. This subsection

11 is exempt from the provisions of Section 3-90.

12 (j) Beginning on January 1, 2002 and through June 30, 2023

13 ~~June 30, 2016~~, the use of tangible personal property purchased

14 from an Illinois retailer by a taxpayer engaged in centralized

15 purchasing activities in Illinois who will, upon receipt of

16 the property in Illinois, temporarily store the property in

17 Illinois (i) for the purpose of subsequently transporting it

18 outside this State for use or consumption thereafter solely

19 outside this State or (ii) for the purpose of being processed,

20 fabricated, or manufactured into, attached to, or incorporated

21 into other tangible personal property to be transported

22 outside this State and thereafter used or consumed solely

23 outside this State. The Director of Revenue shall, pursuant to

24 rules adopted in accordance with the Illinois Administrative

25 Procedure Act, issue a permit to any taxpayer in good standing

26 with the Department who is eligible for the exemption under

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1 this subsection (j). The permit issued under this subsection

2 (j) shall authorize the holder, to the extent and in the manner

3 specified in the rules adopted under this Act, to purchase

4 tangible personal property from a retailer exempt from the

5 taxes imposed by this Act. Taxpayers shall maintain all

6 necessary books and records to substantiate the use and

7 consumption of all such tangible personal property outside of

8 the State of Illinois.

9 (Source: P.A. 100-321, eff. 8-24-17.)

10 Section 10. The Service Use Tax Act is amended by changing

11 Section 3-45 as follows:

12 (35 ILCS 110/3-45) (from Ch. 120, par. 439.33-45)

13 Sec. 3-45. Multistate exemption. To prevent actual or

14 likely multistate taxation, the tax imposed by this Act does

15 not apply to the use of tangible personal property in this

16 State under the following circumstances:

17 (a) The use, in this State, of property acquired outside

18 this State by a nonresident individual and brought into this

19 State by the individual for his or her own use while

20 temporarily within this State or while passing through this

21 State.

22 (b) The use, in this State, of property that is acquired

23 outside this State and that is moved into this State for use as

24 rolling stock moving in interstate commerce.

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1 (c) The use, in this State, of property that is acquired

2 outside this State and caused to be brought into this State by

3 a person who has already paid a tax in another state in respect

4 to the sale, purchase, or use of that property, to the extent

5 of the amount of the tax properly due and paid in the other

6 state.

7 (d) The temporary storage, in this State, of property that

8 is acquired outside this State and that after being brought

9 into this State and stored here temporarily, is used solely

10 outside this State or is physically attached to or

11 incorporated into other property that is used solely outside

12 this State, or is altered by converting, fabricating,

13 manufacturing, printing, processing, or shaping, and, as

14 altered, is used solely outside this State.

15 (e) Beginning July 1, 1999, the use, in this State, of fuel

16 acquired outside this State and brought into this State in the

17 fuel supply tanks of locomotives engaged in freight hauling

18 and passenger service for interstate commerce. This subsection

19 is exempt from the provisions of Section 3-75.

20 (f) Beginning on January 1, 2002 and through June 30, 2023

21 ~~June 30, 2016~~, the use of tangible personal property purchased

22 from an Illinois retailer by a taxpayer engaged in centralized

23 purchasing activities in Illinois who will, upon receipt of

24 the property in Illinois, temporarily store the property in

25 Illinois (i) for the purpose of subsequently transporting it

26 outside this State for use or consumption thereafter solely

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1 outside this State or (ii) for the purpose of being processed,

2 fabricated, or manufactured into, attached to, or incorporated

3 into other tangible personal property to be transported

4 outside this State and thereafter used or consumed solely

5 outside this State. The Director of Revenue shall, pursuant to

6 rules adopted in accordance with the Illinois Administrative

7 Procedure Act, issue a permit to any taxpayer in good standing

8 with the Department who is eligible for the exemption under

9 this subsection (f). The permit issued under this subsection

10 (f) shall authorize the holder, to the extent and in the manner

11 specified in the rules adopted under this Act, to purchase

12 tangible personal property from a retailer exempt from the

13 taxes imposed by this Act. Taxpayers shall maintain all

14 necessary books and records to substantiate the use and

15 consumption of all such tangible personal property outside of

16 the State of Illinois.

17 (Source: P.A. 97-73, eff. 6-30-11.)

18 Section 15. The Service Occupation Tax Act is amended by

19 changing Section 3-5 as follows:

20 (35 ILCS 115/3-5)

21 Sec. 3-5. Exemptions. The following tangible personal

22 property is exempt from the tax imposed by this Act:

23 (1) Personal property sold by a corporation, society,

24 association, foundation, institution, or organization, other

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1 than a limited liability company, that is organized and

2 operated as a not-for-profit service enterprise for the

3 benefit of persons 65 years of age or older if the personal

4 property was not purchased by the enterprise for the purpose

5 of resale by the enterprise.

6 (2) Personal property purchased by a not-for-profit

7 Illinois county fair association for use in conducting,

8 operating, or promoting the county fair.

9 (3) Personal property purchased by any not-for-profit arts

10 or cultural organization that establishes, by proof required

11 by the Department by rule, that it has received an exemption

12 under Section 501(c)(3) of the Internal Revenue Code and that

13 is organized and operated primarily for the presentation or

14 support of arts or cultural programming, activities, or

15 services. These organizations include, but are not limited to,

16 music and dramatic arts organizations such as symphony

17 orchestras and theatrical groups, arts and cultural service

18 organizations, local arts councils, visual arts organizations,

19 and media arts organizations. On and after July 1, 2001 (the

20 effective date of Public Act 92-35), however, an entity

21 otherwise eligible for this exemption shall not make tax-free

22 purchases unless it has an active identification number issued

23 by the Department.

24 (4) Legal tender, currency, medallions, or gold or silver

25 coinage issued by the State of Illinois, the government of the

26 United States of America, or the government of any foreign

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1 country, and bullion.

2 (5) Until July 1, 2003 and beginning again on September 1,

3 2004 through August 30, 2014, graphic arts machinery and

4 equipment, including repair and replacement parts, both new

5 and used, and including that manufactured on special order or

6 purchased for lease, certified by the purchaser to be used

7 primarily for graphic arts production. Equipment includes

8 chemicals or chemicals acting as catalysts but only if the

9 chemicals or chemicals acting as catalysts effect a direct and

10 immediate change upon a graphic arts product. Beginning on

11 July 1, 2017, graphic arts machinery and equipment is included

12 in the manufacturing and assembling machinery and equipment

13 exemption under Section 2 of this Act.

14 (6) Personal property sold by a teacher-sponsored student

15 organization affiliated with an elementary or secondary school

16 located in Illinois.

17 (7) Farm machinery and equipment, both new and used,

18 including that manufactured on special order, certified by the

19 purchaser to be used primarily for production agriculture or

20 State or federal agricultural programs, including individual

21 replacement parts for the machinery and equipment, including

22 machinery and equipment purchased for lease, and including

23 implements of husbandry defined in Section 1-130 of the

24 Illinois Vehicle Code, farm machinery and agricultural

25 chemical and fertilizer spreaders, and nurse wagons required

26 to be registered under Section 3-809 of the Illinois Vehicle

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1 Code, but excluding other motor vehicles required to be

2 registered under the Illinois Vehicle Code. Horticultural

3 polyhouses or hoop houses used for propagating, growing, or

4 overwintering plants shall be considered farm machinery and

5 equipment under this item (7). Agricultural chemical tender

6 tanks and dry boxes shall include units sold separately from a

7 motor vehicle required to be licensed and units sold mounted

8 on a motor vehicle required to be licensed if the selling price

9 of the tender is separately stated.

10 Farm machinery and equipment shall include precision

11 farming equipment that is installed or purchased to be

12 installed on farm machinery and equipment including, but not

13 limited to, tractors, harvesters, sprayers, planters, seeders,

14 or spreaders. Precision farming equipment includes, but is not

15 limited to, soil testing sensors, computers, monitors,

16 software, global positioning and mapping systems, and other

17 such equipment.

18 Farm machinery and equipment also includes computers,

19 sensors, software, and related equipment used primarily in the

20 computer-assisted operation of production agriculture

21 facilities, equipment, and activities such as, but not limited

22 to, the collection, monitoring, and correlation of animal and

23 crop data for the purpose of formulating animal diets and

24 agricultural chemicals. This item (7) is exempt from the

25 provisions of Section 3-55.

26 (8) Until June 30, 2013, fuel and petroleum products sold

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1 to or used by an air common carrier, certified by the carrier

2 to be used for consumption, shipment, or storage in the

3 conduct of its business as an air common carrier, for a flight

4 destined for or returning from a location or locations outside

5 the United States without regard to previous or subsequent

6 domestic stopovers.

7 Beginning July 1, 2013, fuel and petroleum products sold

8 to or used by an air carrier, certified by the carrier to be

9 used for consumption, shipment, or storage in the conduct of

10 its business as an air common carrier, for a flight that (i) is

11 engaged in foreign trade or is engaged in trade between the

12 United States and any of its possessions and (ii) transports

13 at least one individual or package for hire from the city of

14 origination to the city of final destination on the same

15 aircraft, without regard to a change in the flight number of

16 that aircraft.

17 (9) Proceeds of mandatory service charges separately

18 stated on customers' bills for the purchase and consumption of

19 food and beverages, to the extent that the proceeds of the

20 service charge are in fact turned over as tips or as a

21 substitute for tips to the employees who participate directly

22 in preparing, serving, hosting or cleaning up the food or

23 beverage function with respect to which the service charge is

24 imposed.

25 (10) Until July 1, 2003, oil field exploration, drilling,

26 and production equipment, including (i) rigs and parts of

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1 rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)

2 pipe and tubular goods, including casing and drill strings,

3 (iii) pumps and pump-jack units, (iv) storage tanks and flow

4 lines, (v) any individual replacement part for oil field

5 exploration, drilling, and production equipment, and (vi)

6 machinery and equipment purchased for lease; but excluding

7 motor vehicles required to be registered under the Illinois

8 Vehicle Code.

9 (11) Photoprocessing machinery and equipment, including

10 repair and replacement parts, both new and used, including

11 that manufactured on special order, certified by the purchaser

12 to be used primarily for photoprocessing, and including

13 photoprocessing machinery and equipment purchased for lease.

14 (12) Until July 1, 2023, coal and aggregate exploration,

15 mining, off-highway hauling, processing, maintenance, and

16 reclamation equipment, including replacement parts and

17 equipment, and including equipment purchased for lease, but

18 excluding motor vehicles required to be registered under the

19 Illinois Vehicle Code. The changes made to this Section by

20 Public Act 97-767 apply on and after July 1, 2003, but no claim

21 for credit or refund is allowed on or after August 16, 2013

22 (the effective date of Public Act 98-456) for such taxes paid

23 during the period beginning July 1, 2003 and ending on August

24 16, 2013 (the effective date of Public Act 98-456).

25 (13) Beginning January 1, 1992 and through June 30, 2016,

26 food for human consumption that is to be consumed off the

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1 premises where it is sold (other than alcoholic beverages,

2 soft drinks and food that has been prepared for immediate

3 consumption) and prescription and non-prescription medicines,

4 drugs, medical appliances, and insulin, urine testing

5 materials, syringes, and needles used by diabetics, for human

6 use, when purchased for use by a person receiving medical

7 assistance under Article V of the Illinois Public Aid Code who

8 resides in a licensed long-term care facility, as defined in

9 the Nursing Home Care Act, or in a licensed facility as defined

10 in the ID/DD Community Care Act, the MC/DD Act, or the

11 Specialized Mental Health Rehabilitation Act of 2013.

12 (14) Semen used for artificial insemination of livestock

13 for direct agricultural production.

14 (15) Horses, or interests in horses, registered with and

15 meeting the requirements of any of the Arabian Horse Club

16 Registry of America, Appaloosa Horse Club, American Quarter

17 Horse Association, United States Trotting Association, or

18 Jockey Club, as appropriate, used for purposes of breeding or

19 racing for prizes. This item (15) is exempt from the

20 provisions of Section 3-55, and the exemption provided for

21 under this item (15) applies for all periods beginning May 30,

22 1995, but no claim for credit or refund is allowed on or after

23 January 1, 2008 (the effective date of Public Act 95-88) for

24 such taxes paid during the period beginning May 30, 2000 and

25 ending on January 1, 2008 (the effective date of Public Act

26 95-88).

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1 (16) Computers and communications equipment utilized for

2 any hospital purpose and equipment used in the diagnosis,

3 analysis, or treatment of hospital patients sold to a lessor

4 who leases the equipment, under a lease of one year or longer

5 executed or in effect at the time of the purchase, to a

6 hospital that has been issued an active tax exemption

7 identification number by the Department under Section 1g of

8 the Retailers' Occupation Tax Act.

9 (17) Personal property sold to a lessor who leases the

10 property, under a lease of one year or longer executed or in

11 effect at the time of the purchase, to a governmental body that

12 has been issued an active tax exemption identification number

13 by the Department under Section 1g of the Retailers'

14 Occupation Tax Act.

15 (18) Beginning with taxable years ending on or after

16 December 31, 1995 and ending with taxable years ending on or

17 before December 31, 2004, personal property that is donated

18 for disaster relief to be used in a State or federally declared

19 disaster area in Illinois or bordering Illinois by a

20 manufacturer or retailer that is registered in this State to a

21 corporation, society, association, foundation, or institution

22 that has been issued a sales tax exemption identification

23 number by the Department that assists victims of the disaster

24 who reside within the declared disaster area.

25 (19) Beginning with taxable years ending on or after

26 December 31, 1995 and ending with taxable years ending on or

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1 before December 31, 2004, personal property that is used in

2 the performance of infrastructure repairs in this State,

3 including but not limited to municipal roads and streets,

4 access roads, bridges, sidewalks, waste disposal systems,

5 water and sewer line extensions, water distribution and

6 purification facilities, storm water drainage and retention

7 facilities, and sewage treatment facilities, resulting from a

8 State or federally declared disaster in Illinois or bordering

9 Illinois when such repairs are initiated on facilities located

10 in the declared disaster area within 6 months after the

11 disaster.

12 (20) Beginning July 1, 1999, game or game birds sold at a

13 "game breeding and hunting preserve area" as that term is used

14 in the Wildlife Code. This paragraph is exempt from the

15 provisions of Section 3-55.

16 (21) A motor vehicle, as that term is defined in Section

17 1-146 of the Illinois Vehicle Code, that is donated to a

18 corporation, limited liability company, society, association,

19 foundation, or institution that is determined by the

20 Department to be organized and operated exclusively for

21 educational purposes. For purposes of this exemption, "a

22 corporation, limited liability company, society, association,

23 foundation, or institution organized and operated exclusively

24 for educational purposes" means all tax-supported public

25 schools, private schools that offer systematic instruction in

26 useful branches of learning by methods common to public

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1 schools and that compare favorably in their scope and

2 intensity with the course of study presented in tax-supported

3 schools, and vocational or technical schools or institutes

4 organized and operated exclusively to provide a course of

5 study of not less than 6 weeks duration and designed to prepare

6 individuals to follow a trade or to pursue a manual,

7 technical, mechanical, industrial, business, or commercial

8 occupation.

9 (22) Beginning January 1, 2000, personal property,

10 including food, purchased through fundraising events for the

11 benefit of a public or private elementary or secondary school,

12 a group of those schools, or one or more school districts if

13 the events are sponsored by an entity recognized by the school

14 district that consists primarily of volunteers and includes

15 parents and teachers of the school children. This paragraph

16 does not apply to fundraising events (i) for the benefit of

17 private home instruction or (ii) for which the fundraising

18 entity purchases the personal property sold at the events from

19 another individual or entity that sold the property for the

20 purpose of resale by the fundraising entity and that profits

21 from the sale to the fundraising entity. This paragraph is

22 exempt from the provisions of Section 3-55.

23 (23) Beginning January 1, 2000 and through December 31,

24 2001, new or used automatic vending machines that prepare and

25 serve hot food and beverages, including coffee, soup, and

26 other items, and replacement parts for these machines.

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1 Beginning January 1, 2002 and through June 30, 2003, machines

2 and parts for machines used in commercial, coin-operated

3 amusement and vending business if a use or occupation tax is

4 paid on the gross receipts derived from the use of the

5 commercial, coin-operated amusement and vending machines. This

6 paragraph is exempt from the provisions of Section 3-55.

7 (24) Beginning on August 2, 2001 (the effective date of

8 Public Act 92-227), computers and communications equipment

9 utilized for any hospital purpose and equipment used in the

10 diagnosis, analysis, or treatment of hospital patients sold to

11 a lessor who leases the equipment, under a lease of one year or

12 longer executed or in effect at the time of the purchase, to a

13 hospital that has been issued an active tax exemption

14 identification number by the Department under Section 1g of

15 the Retailers' Occupation Tax Act. This paragraph is exempt

16 from the provisions of Section 3-55.

17 (25) Beginning on August 2, 2001 (the effective date of

18 Public Act 92-227), personal property sold to a lessor who

19 leases the property, under a lease of one year or longer

20 executed or in effect at the time of the purchase, to a

21 governmental body that has been issued an active tax exemption

22 identification number by the Department under Section 1g of

23 the Retailers' Occupation Tax Act. This paragraph is exempt

24 from the provisions of Section 3-55.

25 (26) Beginning on January 1, 2002 and through June 30,

26 2023 ~~June 30, 2016~~, tangible personal property purchased from

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1 an Illinois retailer by a taxpayer engaged in centralized

2 purchasing activities in Illinois who will, upon receipt of

3 the property in Illinois, temporarily store the property in

4 Illinois (i) for the purpose of subsequently transporting it

5 outside this State for use or consumption thereafter solely

6 outside this State or (ii) for the purpose of being processed,

7 fabricated, or manufactured into, attached to, or incorporated

8 into other tangible personal property to be transported

9 outside this State and thereafter used or consumed solely

10 outside this State. The Director of Revenue shall, pursuant to

11 rules adopted in accordance with the Illinois Administrative

12 Procedure Act, issue a permit to any taxpayer in good standing

13 with the Department who is eligible for the exemption under

14 this paragraph (26). The permit issued under this paragraph

15 (26) shall authorize the holder, to the extent and in the

16 manner specified in the rules adopted under this Act, to

17 purchase tangible personal property from a retailer exempt

18 from the taxes imposed by this Act. Taxpayers shall maintain

19 all necessary books and records to substantiate the use and

20 consumption of all such tangible personal property outside of

21 the State of Illinois.

22 (27) Beginning January 1, 2008, tangible personal property

23 used in the construction or maintenance of a community water

24 supply, as defined under Section 3.145 of the Environmental

25 Protection Act, that is operated by a not-for-profit

26 corporation that holds a valid water supply permit issued

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1 under Title IV of the Environmental Protection Act. This

2 paragraph is exempt from the provisions of Section 3-55.

3 (28) Tangible personal property sold to a

4 public-facilities corporation, as described in Section

5 11-65-10 of the Illinois Municipal Code, for purposes of

6 constructing or furnishing a municipal convention hall, but

7 only if the legal title to the municipal convention hall is

8 transferred to the municipality without any further

9 consideration by or on behalf of the municipality at the time

10 of the completion of the municipal convention hall or upon the

11 retirement or redemption of any bonds or other debt

12 instruments issued by the public-facilities corporation in

13 connection with the development of the municipal convention

14 hall. This exemption includes existing public-facilities

15 corporations as provided in Section 11-65-25 of the Illinois

16 Municipal Code. This paragraph is exempt from the provisions

17 of Section 3-55.

18 (29) Beginning January 1, 2010 and continuing through

19 December 31, 2024, materials, parts, equipment, components,

20 and furnishings incorporated into or upon an aircraft as part

21 of the modification, refurbishment, completion, replacement,

22 repair, or maintenance of the aircraft. This exemption

23 includes consumable supplies used in the modification,

24 refurbishment, completion, replacement, repair, and

25 maintenance of aircraft, but excludes any materials, parts,

26 equipment, components, and consumable supplies used in the

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1 modification, replacement, repair, and maintenance of aircraft

2 engines or power plants, whether such engines or power plants

3 are installed or uninstalled upon any such aircraft.

4 "Consumable supplies" include, but are not limited to,

5 adhesive, tape, sandpaper, general purpose lubricants,

6 cleaning solution, latex gloves, and protective films. This

7 exemption applies only to the transfer of qualifying tangible

8 personal property incident to the modification, refurbishment,

9 completion, replacement, repair, or maintenance of an aircraft

10 by persons who (i) hold an Air Agency Certificate and are

11 empowered to operate an approved repair station by the Federal

12 Aviation Administration, (ii) have a Class IV Rating, and

13 (iii) conduct operations in accordance with Part 145 of the

14 Federal Aviation Regulations. The exemption does not include

15 aircraft operated by a commercial air carrier providing

16 scheduled passenger air service pursuant to authority issued

17 under Part 121 or Part 129 of the Federal Aviation

18 Regulations. The changes made to this paragraph (29) by Public

19 Act 98-534 are declarative of existing law. It is the intent of

20 the General Assembly that the exemption under this paragraph

21 (29) applies continuously from January 1, 2010 through

22 December 31, 2024; however, no claim for credit or refund is

23 allowed for taxes paid as a result of the disallowance of this

24 exemption on or after January 1, 2015 and prior to the

25 effective date of this amendatory Act of the 101st General

26 Assembly.

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1 (30) Beginning January 1, 2017 and through December 31,

2 2026, menstrual pads, tampons, and menstrual cups.

3 (31) Tangible personal property transferred to a purchaser

4 who is exempt from tax by operation of federal law. This

5 paragraph is exempt from the provisions of Section 3-55.

6 (32) Qualified tangible personal property used in the

7 construction or operation of a data center that has been

8 granted a certificate of exemption by the Department of

9 Commerce and Economic Opportunity, whether that tangible

10 personal property is purchased by the owner, operator, or

11 tenant of the data center or by a contractor or subcontractor

12 of the owner, operator, or tenant. Data centers that would

13 have qualified for a certificate of exemption prior to January

14 1, 2020 had this amendatory Act of the 101st General Assembly

15 been in effect, may apply for and obtain an exemption for

16 subsequent purchases of computer equipment or enabling

17 software purchased or leased to upgrade, supplement, or

18 replace computer equipment or enabling software purchased or

19 leased in the original investment that would have qualified.

20 The Department of Commerce and Economic Opportunity shall

21 grant a certificate of exemption under this item (32) to

22 qualified data centers as defined by Section 605-1025 of the

23 Department of Commerce and Economic Opportunity Law of the

24 Civil Administrative Code of Illinois.

25 For the purposes of this item (32):

26 "Data center" means a building or a series of

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1 buildings rehabilitated or constructed to house working

2 servers in one physical location or multiple sites within

3 the State of Illinois.

4 "Qualified tangible personal property" means:

5 electrical systems and equipment; climate control and

6 chilling equipment and systems; mechanical systems and

7 equipment; monitoring and secure systems; emergency

8 generators; hardware; computers; servers; data storage

9 devices; network connectivity equipment; racks; cabinets;

10 telecommunications cabling infrastructure; raised floor

11 systems; peripheral components or systems; software;

12 mechanical, electrical, or plumbing systems; battery

13 systems; cooling systems and towers; temperature control

14 systems; other cabling; and other data center

15 infrastructure equipment and systems necessary to operate

16 qualified tangible personal property, including fixtures;

17 and component parts of any of the foregoing, including

18 installation, maintenance, repair, refurbishment, and

19 replacement of qualified tangible personal property to

20 generate, transform, transmit, distribute, or manage

21 electricity necessary to operate qualified tangible

22 personal property; and all other tangible personal

23 property that is essential to the operations of a computer

24 data center. The term "qualified tangible personal

25 property" also includes building materials physically

26 incorporated in to the qualifying data center. To document

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1 the exemption allowed under this Section, the retailer

2 must obtain from the purchaser a copy of the certificate

3 of eligibility issued by the Department of Commerce and

4 Economic Opportunity.

5 This item (32) is exempt from the provisions of Section

6 3-55.

7 (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;

8 101-629, eff. 2-5-20; 102-16, eff. 6-17-21.)

9 Section 20. The Retailers' Occupation Tax Act is amended

10 by changing Section 2-5 as follows:

11 (35 ILCS 120/2-5)

12 Sec. 2-5. Exemptions. Gross receipts from proceeds from

13 the sale of the following tangible personal property are

14 exempt from the tax imposed by this Act:

15 (1) Farm chemicals.

16 (2) Farm machinery and equipment, both new and used,

17 including that manufactured on special order, certified by

18 the purchaser to be used primarily for production

19 agriculture or State or federal agricultural programs,

20 including individual replacement parts for the machinery

21 and equipment, including machinery and equipment purchased

22 for lease, and including implements of husbandry defined

23 in Section 1-130 of the Illinois Vehicle Code, farm

24 machinery and agricultural chemical and fertilizer

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1 spreaders, and nurse wagons required to be registered

2 under Section 3-809 of the Illinois Vehicle Code, but

3 excluding other motor vehicles required to be registered

4 under the Illinois Vehicle Code. Horticultural polyhouses

5 or hoop houses used for propagating, growing, or

6 overwintering plants shall be considered farm machinery

7 and equipment under this item (2). Agricultural chemical

8 tender tanks and dry boxes shall include units sold

9 separately from a motor vehicle required to be licensed

10 and units sold mounted on a motor vehicle required to be

11 licensed, if the selling price of the tender is separately

12 stated.

13 Farm machinery and equipment shall include precision

14 farming equipment that is installed or purchased to be

15 installed on farm machinery and equipment including, but

16 not limited to, tractors, harvesters, sprayers, planters,

17 seeders, or spreaders. Precision farming equipment

18 includes, but is not limited to, soil testing sensors,

19 computers, monitors, software, global positioning and

20 mapping systems, and other such equipment.

21 Farm machinery and equipment also includes computers,

22 sensors, software, and related equipment used primarily in

23 the computer-assisted operation of production agriculture

24 facilities, equipment, and activities such as, but not

25 limited to, the collection, monitoring, and correlation of

26 animal and crop data for the purpose of formulating animal

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1 diets and agricultural chemicals. This item (2) is exempt

2 from the provisions of Section 2-70.

3 (3) Until July 1, 2003, distillation machinery and

4 equipment, sold as a unit or kit, assembled or installed

5 by the retailer, certified by the user to be used only for

6 the production of ethyl alcohol that will be used for

7 consumption as motor fuel or as a component of motor fuel

8 for the personal use of the user, and not subject to sale

9 or resale.

10 (4) Until July 1, 2003 and beginning again September

11 1, 2004 through August 30, 2014, graphic arts machinery

12 and equipment, including repair and replacement parts,

13 both new and used, and including that manufactured on

14 special order or purchased for lease, certified by the

15 purchaser to be used primarily for graphic arts

16 production. Equipment includes chemicals or chemicals

17 acting as catalysts but only if the chemicals or chemicals

18 acting as catalysts effect a direct and immediate change

19 upon a graphic arts product. Beginning on July 1, 2017,

20 graphic arts machinery and equipment is included in the

21 manufacturing and assembling machinery and equipment

22 exemption under paragraph (14).

23 (5) A motor vehicle that is used for automobile

24 renting, as defined in the Automobile Renting Occupation

25 and Use Tax Act. This paragraph is exempt from the

26 provisions of Section 2-70.

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1 (6) Personal property sold by a teacher-sponsored

2 student organization affiliated with an elementary or

3 secondary school located in Illinois.

4 (7) Until July 1, 2003, proceeds of that portion of

5 the selling price of a passenger car the sale of which is

6 subject to the Replacement Vehicle Tax.

7 (8) Personal property sold to an Illinois county fair

8 association for use in conducting, operating, or promoting

9 the county fair.

10 (9) Personal property sold to a not-for-profit arts or

11 cultural organization that establishes, by proof required

12 by the Department by rule, that it has received an

13 exemption under Section 501(c)(3) of the Internal Revenue

14 Code and that is organized and operated primarily for the

15 presentation or support of arts or cultural programming,

16 activities, or services. These organizations include, but

17 are not limited to, music and dramatic arts organizations

18 such as symphony orchestras and theatrical groups, arts

19 and cultural service organizations, local arts councils,

20 visual arts organizations, and media arts organizations.

21 On and after July 1, 2001 (the effective date of Public Act

22 92-35), however, an entity otherwise eligible for this

23 exemption shall not make tax-free purchases unless it has

24 an active identification number issued by the Department.

25 (10) Personal property sold by a corporation, society,

26 association, foundation, institution, or organization,

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1 other than a limited liability company, that is organized

2 and operated as a not-for-profit service enterprise for

3 the benefit of persons 65 years of age or older if the

4 personal property was not purchased by the enterprise for

5 the purpose of resale by the enterprise.

6 (11) Personal property sold to a governmental body, to

7 a corporation, society, association, foundation, or

8 institution organized and operated exclusively for

9 charitable, religious, or educational purposes, or to a

10 not-for-profit corporation, society, association,

11 foundation, institution, or organization that has no

12 compensated officers or employees and that is organized

13 and operated primarily for the recreation of persons 55

14 years of age or older. A limited liability company may

15 qualify for the exemption under this paragraph only if the

16 limited liability company is organized and operated

17 exclusively for educational purposes. On and after July 1,

18 1987, however, no entity otherwise eligible for this

19 exemption shall make tax-free purchases unless it has an

20 active identification number issued by the Department.

21 (12) (Blank).

22 (12-5) On and after July 1, 2003 and through June 30,

23 2004, motor vehicles of the second division with a gross

24 vehicle weight in excess of 8,000 pounds that are subject

25 to the commercial distribution fee imposed under Section

26 3-815.1 of the Illinois Vehicle Code. Beginning on July 1,

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1 2004 and through June 30, 2005, the use in this State of

2 motor vehicles of the second division: (i) with a gross

3 vehicle weight rating in excess of 8,000 pounds; (ii) that

4 are subject to the commercial distribution fee imposed

5 under Section 3-815.1 of the Illinois Vehicle Code; and

6 (iii) that are primarily used for commercial purposes.

7 Through June 30, 2005, this exemption applies to repair

8 and replacement parts added after the initial purchase of

9 such a motor vehicle if that motor vehicle is used in a

10 manner that would qualify for the rolling stock exemption

11 otherwise provided for in this Act. For purposes of this

12 paragraph, "used for commercial purposes" means the

13 transportation of persons or property in furtherance of

14 any commercial or industrial enterprise whether for-hire

15 or not.

16 (13) Proceeds from sales to owners, lessors, or

17 shippers of tangible personal property that is utilized by

18 interstate carriers for hire for use as rolling stock

19 moving in interstate commerce and equipment operated by a

20 telecommunications provider, licensed as a common carrier

21 by the Federal Communications Commission, which is

22 permanently installed in or affixed to aircraft moving in

23 interstate commerce.

24 (14) Machinery and equipment that will be used by the

25 purchaser, or a lessee of the purchaser, primarily in the

26 process of manufacturing or assembling tangible personal

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1 property for wholesale or retail sale or lease, whether

2 the sale or lease is made directly by the manufacturer or

3 by some other person, whether the materials used in the

4 process are owned by the manufacturer or some other

5 person, or whether the sale or lease is made apart from or

6 as an incident to the seller's engaging in the service

7 occupation of producing machines, tools, dies, jigs,

8 patterns, gauges, or other similar items of no commercial

9 value on special order for a particular purchaser. The

10 exemption provided by this paragraph (14) does not include

11 machinery and equipment used in (i) the generation of

12 electricity for wholesale or retail sale; (ii) the

13 generation or treatment of natural or artificial gas for

14 wholesale or retail sale that is delivered to customers

15 through pipes, pipelines, or mains; or (iii) the treatment

16 of water for wholesale or retail sale that is delivered to

17 customers through pipes, pipelines, or mains. The

18 provisions of Public Act 98-583 are declaratory of

19 existing law as to the meaning and scope of this

20 exemption. Beginning on July 1, 2017, the exemption

21 provided by this paragraph (14) includes, but is not

22 limited to, graphic arts machinery and equipment, as

23 defined in paragraph (4) of this Section.

24 (15) Proceeds of mandatory service charges separately

25 stated on customers' bills for purchase and consumption of

26 food and beverages, to the extent that the proceeds of the

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1 service charge are in fact turned over as tips or as a

2 substitute for tips to the employees who participate

3 directly in preparing, serving, hosting or cleaning up the

4 food or beverage function with respect to which the

5 service charge is imposed.

6 (16) Tangible personal property sold to a purchaser if

7 the purchaser is exempt from use tax by operation of

8 federal law. This paragraph is exempt from the provisions

9 of Section 2-70.

10 (17) Tangible personal property sold to a common

11 carrier by rail or motor that receives the physical

12 possession of the property in Illinois and that transports

13 the property, or shares with another common carrier in the

14 transportation of the property, out of Illinois on a

15 standard uniform bill of lading showing the seller of the

16 property as the shipper or consignor of the property to a

17 destination outside Illinois, for use outside Illinois.

18 (18) Legal tender, currency, medallions, or gold or

19 silver coinage issued by the State of Illinois, the

20 government of the United States of America, or the

21 government of any foreign country, and bullion.

22 (19) Until July 1, 2003, oil field exploration,

23 drilling, and production equipment, including (i) rigs and

24 parts of rigs, rotary rigs, cable tool rigs, and workover

25 rigs, (ii) pipe and tubular goods, including casing and

26 drill strings, (iii) pumps and pump-jack units, (iv)

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1 storage tanks and flow lines, (v) any individual

2 replacement part for oil field exploration, drilling, and

3 production equipment, and (vi) machinery and equipment

4 purchased for lease; but excluding motor vehicles required

5 to be registered under the Illinois Vehicle Code.

6 (20) Photoprocessing machinery and equipment,

7 including repair and replacement parts, both new and used,

8 including that manufactured on special order, certified by

9 the purchaser to be used primarily for photoprocessing,

10 and including photoprocessing machinery and equipment

11 purchased for lease.

12 (21) Until July 1, 2023, coal and aggregate

13 exploration, mining, off-highway hauling, processing,

14 maintenance, and reclamation equipment, including

15 replacement parts and equipment, and including equipment

16 purchased for lease, but excluding motor vehicles required

17 to be registered under the Illinois Vehicle Code. The

18 changes made to this Section by Public Act 97-767 apply on

19 and after July 1, 2003, but no claim for credit or refund

20 is allowed on or after August 16, 2013 (the effective date

21 of Public Act 98-456) for such taxes paid during the

22 period beginning July 1, 2003 and ending on August 16,

23 2013 (the effective date of Public Act 98-456).

24 (22) Until June 30, 2013, fuel and petroleum products

25 sold to or used by an air carrier, certified by the carrier

26 to be used for consumption, shipment, or storage in the

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1 conduct of its business as an air common carrier, for a

2 flight destined for or returning from a location or

3 locations outside the United States without regard to

4 previous or subsequent domestic stopovers.

5 Beginning July 1, 2013, fuel and petroleum products

6 sold to or used by an air carrier, certified by the carrier

7 to be used for consumption, shipment, or storage in the

8 conduct of its business as an air common carrier, for a

9 flight that (i) is engaged in foreign trade or is engaged

10 in trade between the United States and any of its

11 possessions and (ii) transports at least one individual or

12 package for hire from the city of origination to the city

13 of final destination on the same aircraft, without regard

14 to a change in the flight number of that aircraft.

15 (23) A transaction in which the purchase order is

16 received by a florist who is located outside Illinois, but

17 who has a florist located in Illinois deliver the property

18 to the purchaser or the purchaser's donee in Illinois.

19 (24) Fuel consumed or used in the operation of ships,

20 barges, or vessels that are used primarily in or for the

21 transportation of property or the conveyance of persons

22 for hire on rivers bordering on this State if the fuel is

23 delivered by the seller to the purchaser's barge, ship, or

24 vessel while it is afloat upon that bordering river.

25 (25) Except as provided in item (25-5) of this

26 Section, a motor vehicle sold in this State to a

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1 nonresident even though the motor vehicle is delivered to

2 the nonresident in this State, if the motor vehicle is not

3 to be titled in this State, and if a drive-away permit is

4 issued to the motor vehicle as provided in Section 3-603

5 of the Illinois Vehicle Code or if the nonresident

6 purchaser has vehicle registration plates to transfer to

7 the motor vehicle upon returning to his or her home state.

8 The issuance of the drive-away permit or having the

9 out-of-state registration plates to be transferred is

10 prima facie evidence that the motor vehicle will not be

11 titled in this State.

12 (25-5) The exemption under item (25) does not apply if

13 the state in which the motor vehicle will be titled does

14 not allow a reciprocal exemption for a motor vehicle sold

15 and delivered in that state to an Illinois resident but

16 titled in Illinois. The tax collected under this Act on

17 the sale of a motor vehicle in this State to a resident of

18 another state that does not allow a reciprocal exemption

19 shall be imposed at a rate equal to the state's rate of tax

20 on taxable property in the state in which the purchaser is

21 a resident, except that the tax shall not exceed the tax

22 that would otherwise be imposed under this Act. At the

23 time of the sale, the purchaser shall execute a statement,

24 signed under penalty of perjury, of his or her intent to

25 title the vehicle in the state in which the purchaser is a

26 resident within 30 days after the sale and of the fact of

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1 the payment to the State of Illinois of tax in an amount

2 equivalent to the state's rate of tax on taxable property

3 in his or her state of residence and shall submit the

4 statement to the appropriate tax collection agency in his

5 or her state of residence. In addition, the retailer must

6 retain a signed copy of the statement in his or her

7 records. Nothing in this item shall be construed to

8 require the removal of the vehicle from this state

9 following the filing of an intent to title the vehicle in

10 the purchaser's state of residence if the purchaser titles

11 the vehicle in his or her state of residence within 30 days

12 after the date of sale. The tax collected under this Act in

13 accordance with this item (25-5) shall be proportionately

14 distributed as if the tax were collected at the 6.25%

15 general rate imposed under this Act.

16 (25-7) Beginning on July 1, 2007, no tax is imposed

17 under this Act on the sale of an aircraft, as defined in

18 Section 3 of the Illinois Aeronautics Act, if all of the

19 following conditions are met:

20 (1) the aircraft leaves this State within 15 days

21 after the later of either the issuance of the final

22 billing for the sale of the aircraft, or the

23 authorized approval for return to service, completion

24 of the maintenance record entry, and completion of the

25 test flight and ground test for inspection, as

26 required by 14 C.F.R. 91.407;

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1 (2) the aircraft is not based or registered in

2 this State after the sale of the aircraft; and

3 (3) the seller retains in his or her books and

4 records and provides to the Department a signed and

5 dated certification from the purchaser, on a form

6 prescribed by the Department, certifying that the

7 requirements of this item (25-7) are met. The

8 certificate must also include the name and address of

9 the purchaser, the address of the location where the

10 aircraft is to be titled or registered, the address of

11 the primary physical location of the aircraft, and

12 other information that the Department may reasonably

13 require.

14 For purposes of this item (25-7):

15 "Based in this State" means hangared, stored, or

16 otherwise used, excluding post-sale customizations as

17 defined in this Section, for 10 or more days in each

18 12-month period immediately following the date of the sale

19 of the aircraft.

20 "Registered in this State" means an aircraft

21 registered with the Department of Transportation,

22 Aeronautics Division, or titled or registered with the

23 Federal Aviation Administration to an address located in

24 this State.

25 This paragraph (25-7) is exempt from the provisions of

26 Section 2-70.

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1 (26) Semen used for artificial insemination of

2 livestock for direct agricultural production.

3 (27) Horses, or interests in horses, registered with

4 and meeting the requirements of any of the Arabian Horse

5 Club Registry of America, Appaloosa Horse Club, American

6 Quarter Horse Association, United States Trotting

7 Association, or Jockey Club, as appropriate, used for

8 purposes of breeding or racing for prizes. This item (27)

9 is exempt from the provisions of Section 2-70, and the

10 exemption provided for under this item (27) applies for

11 all periods beginning May 30, 1995, but no claim for

12 credit or refund is allowed on or after January 1, 2008

13 (the effective date of Public Act 95-88) for such taxes

14 paid during the period beginning May 30, 2000 and ending

15 on January 1, 2008 (the effective date of Public Act

16 95-88).

17 (28) Computers and communications equipment utilized

18 for any hospital purpose and equipment used in the

19 diagnosis, analysis, or treatment of hospital patients

20 sold to a lessor who leases the equipment, under a lease of

21 one year or longer executed or in effect at the time of the

22 purchase, to a hospital that has been issued an active tax

23 exemption identification number by the Department under

24 Section 1g of this Act.

25 (29) Personal property sold to a lessor who leases the

26 property, under a lease of one year or longer executed or

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1 in effect at the time of the purchase, to a governmental

2 body that has been issued an active tax exemption

3 identification number by the Department under Section 1g

4 of this Act.

5 (30) Beginning with taxable years ending on or after

6 December 31, 1995 and ending with taxable years ending on

7 or before December 31, 2004, personal property that is

8 donated for disaster relief to be used in a State or

9 federally declared disaster area in Illinois or bordering

10 Illinois by a manufacturer or retailer that is registered

11 in this State to a corporation, society, association,

12 foundation, or institution that has been issued a sales

13 tax exemption identification number by the Department that

14 assists victims of the disaster who reside within the

15 declared disaster area.

16 (31) Beginning with taxable years ending on or after

17 December 31, 1995 and ending with taxable years ending on

18 or before December 31, 2004, personal property that is

19 used in the performance of infrastructure repairs in this

20 State, including but not limited to municipal roads and

21 streets, access roads, bridges, sidewalks, waste disposal

22 systems, water and sewer line extensions, water

23 distribution and purification facilities, storm water

24 drainage and retention facilities, and sewage treatment

25 facilities, resulting from a State or federally declared

26 disaster in Illinois or bordering Illinois when such

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1 repairs are initiated on facilities located in the

2 declared disaster area within 6 months after the disaster.

3 (32) Beginning July 1, 1999, game or game birds sold

4 at a "game breeding and hunting preserve area" as that

5 term is used in the Wildlife Code. This paragraph is

6 exempt from the provisions of Section 2-70.

7 (33) A motor vehicle, as that term is defined in

8 Section 1-146 of the Illinois Vehicle Code, that is

9 donated to a corporation, limited liability company,

10 society, association, foundation, or institution that is

11 determined by the Department to be organized and operated

12 exclusively for educational purposes. For purposes of this

13 exemption, "a corporation, limited liability company,

14 society, association, foundation, or institution organized

15 and operated exclusively for educational purposes" means

16 all tax-supported public schools, private schools that

17 offer systematic instruction in useful branches of

18 learning by methods common to public schools and that

19 compare favorably in their scope and intensity with the

20 course of study presented in tax-supported schools, and

21 vocational or technical schools or institutes organized

22 and operated exclusively to provide a course of study of

23 not less than 6 weeks duration and designed to prepare

24 individuals to follow a trade or to pursue a manual,

25 technical, mechanical, industrial, business, or commercial

26 occupation.

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1 (34) Beginning January 1, 2000, personal property,

2 including food, purchased through fundraising events for

3 the benefit of a public or private elementary or secondary

4 school, a group of those schools, or one or more school

5 districts if the events are sponsored by an entity

6 recognized by the school district that consists primarily

7 of volunteers and includes parents and teachers of the

8 school children. This paragraph does not apply to

9 fundraising events (i) for the benefit of private home

10 instruction or (ii) for which the fundraising entity

11 purchases the personal property sold at the events from

12 another individual or entity that sold the property for

13 the purpose of resale by the fundraising entity and that

14 profits from the sale to the fundraising entity. This

15 paragraph is exempt from the provisions of Section 2-70.

16 (35) Beginning January 1, 2000 and through December

17 31, 2001, new or used automatic vending machines that

18 prepare and serve hot food and beverages, including

19 coffee, soup, and other items, and replacement parts for

20 these machines. Beginning January 1, 2002 and through June

21 30, 2003, machines and parts for machines used in

22 commercial, coin-operated amusement and vending business

23 if a use or occupation tax is paid on the gross receipts

24 derived from the use of the commercial, coin-operated

25 amusement and vending machines. This paragraph is exempt

26 from the provisions of Section 2-70.

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1 (35-5) Beginning August 23, 2001 and through June 30,

2 2016, food for human consumption that is to be consumed

3 off the premises where it is sold (other than alcoholic

4 beverages, soft drinks, and food that has been prepared

5 for immediate consumption) and prescription and

6 nonprescription medicines, drugs, medical appliances, and

7 insulin, urine testing materials, syringes, and needles

8 used by diabetics, for human use, when purchased for use

9 by a person receiving medical assistance under Article V

10 of the Illinois Public Aid Code who resides in a licensed

11 long-term care facility, as defined in the Nursing Home

12 Care Act, or a licensed facility as defined in the ID/DD

13 Community Care Act, the MC/DD Act, or the Specialized

14 Mental Health Rehabilitation Act of 2013.

15 (36) Beginning August 2, 2001, computers and

16 communications equipment utilized for any hospital purpose

17 and equipment used in the diagnosis, analysis, or

18 treatment of hospital patients sold to a lessor who leases

19 the equipment, under a lease of one year or longer

20 executed or in effect at the time of the purchase, to a

21 hospital that has been issued an active tax exemption

22 identification number by the Department under Section 1g

23 of this Act. This paragraph is exempt from the provisions

24 of Section 2-70.

25 (37) Beginning August 2, 2001, personal property sold

26 to a lessor who leases the property, under a lease of one

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1 year or longer executed or in effect at the time of the

2 purchase, to a governmental body that has been issued an

3 active tax exemption identification number by the

4 Department under Section 1g of this Act. This paragraph is

5 exempt from the provisions of Section 2-70.

6 (38) Beginning on January 1, 2002 and through June 30,

7 2023 ~~June 30, 2016~~, tangible personal property purchased

8 from an Illinois retailer by a taxpayer engaged in

9 centralized purchasing activities in Illinois who will,

10 upon receipt of the property in Illinois, temporarily

11 store the property in Illinois (i) for the purpose of

12 subsequently transporting it outside this State for use or

13 consumption thereafter solely outside this State or (ii)

14 for the purpose of being processed, fabricated, or

15 manufactured into, attached to, or incorporated into other

16 tangible personal property to be transported outside this

17 State and thereafter used or consumed solely outside this

18 State. The Director of Revenue shall, pursuant to rules

19 adopted in accordance with the Illinois Administrative

20 Procedure Act, issue a permit to any taxpayer in good

21 standing with the Department who is eligible for the

22 exemption under this paragraph (38). The permit issued

23 under this paragraph (38) shall authorize the holder, to

24 the extent and in the manner specified in the rules

25 adopted under this Act, to purchase tangible personal

26 property from a retailer exempt from the taxes imposed by

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1 this Act. Taxpayers shall maintain all necessary books and

2 records to substantiate the use and consumption of all

3 such tangible personal property outside of the State of

4 Illinois.

5 (39) Beginning January 1, 2008, tangible personal

6 property used in the construction or maintenance of a

7 community water supply, as defined under Section 3.145 of

8 the Environmental Protection Act, that is operated by a

9 not-for-profit corporation that holds a valid water supply

10 permit issued under Title IV of the Environmental

11 Protection Act. This paragraph is exempt from the

12 provisions of Section 2-70.

13 (40) Beginning January 1, 2010 and continuing through

14 December 31, 2024, materials, parts, equipment,

15 components, and furnishings incorporated into or upon an

16 aircraft as part of the modification, refurbishment,

17 completion, replacement, repair, or maintenance of the

18 aircraft. This exemption includes consumable supplies used

19 in the modification, refurbishment, completion,

20 replacement, repair, and maintenance of aircraft, but

21 excludes any materials, parts, equipment, components, and

22 consumable supplies used in the modification, replacement,

23 repair, and maintenance of aircraft engines or power

24 plants, whether such engines or power plants are installed

25 or uninstalled upon any such aircraft. "Consumable

26 supplies" include, but are not limited to, adhesive, tape,

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1 sandpaper, general purpose lubricants, cleaning solution,

2 latex gloves, and protective films. This exemption applies

3 only to the sale of qualifying tangible personal property

4 to persons who modify, refurbish, complete, replace, or

5 maintain an aircraft and who (i) hold an Air Agency

6 Certificate and are empowered to operate an approved

7 repair station by the Federal Aviation Administration,

8 (ii) have a Class IV Rating, and (iii) conduct operations

9 in accordance with Part 145 of the Federal Aviation

10 Regulations. The exemption does not include aircraft

11 operated by a commercial air carrier providing scheduled

12 passenger air service pursuant to authority issued under

13 Part 121 or Part 129 of the Federal Aviation Regulations.

14 The changes made to this paragraph (40) by Public Act

15 98-534 are declarative of existing law. It is the intent

16 of the General Assembly that the exemption under this

17 paragraph (40) applies continuously from January 1, 2010

18 through December 31, 2024; however, no claim for credit or

19 refund is allowed for taxes paid as a result of the

20 disallowance of this exemption on or after January 1, 2015

21 and prior to the effective date of this amendatory Act of

22 the 101st General Assembly.

23 (41) Tangible personal property sold to a

24 public-facilities corporation, as described in Section

25 11-65-10 of the Illinois Municipal Code, for purposes of

26 constructing or furnishing a municipal convention hall,

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1 but only if the legal title to the municipal convention

2 hall is transferred to the municipality without any

3 further consideration by or on behalf of the municipality

4 at the time of the completion of the municipal convention

5 hall or upon the retirement or redemption of any bonds or

6 other debt instruments issued by the public-facilities

7 corporation in connection with the development of the

8 municipal convention hall. This exemption includes

9 existing public-facilities corporations as provided in

10 Section 11-65-25 of the Illinois Municipal Code. This

11 paragraph is exempt from the provisions of Section 2-70.

12 (42) Beginning January 1, 2017 and through December

13 31, 2026, menstrual pads, tampons, and menstrual cups.

14 (43) Merchandise that is subject to the Rental

15 Purchase Agreement Occupation and Use Tax. The purchaser

16 must certify that the item is purchased to be rented

17 subject to a rental purchase agreement, as defined in the

18 Rental Purchase Agreement Act, and provide proof of

19 registration under the Rental Purchase Agreement

20 Occupation and Use Tax Act. This paragraph is exempt from

21 the provisions of Section 2-70.

22 (44) Qualified tangible personal property used in the

23 construction or operation of a data center that has been

24 granted a certificate of exemption by the Department of

25 Commerce and Economic Opportunity, whether that tangible

26 personal property is purchased by the owner, operator, or

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1 tenant of the data center or by a contractor or

2 subcontractor of the owner, operator, or tenant. Data

3 centers that would have qualified for a certificate of

4 exemption prior to January 1, 2020 had this amendatory Act

5 of the 101st General Assembly been in effect, may apply

6 for and obtain an exemption for subsequent purchases of

7 computer equipment or enabling software purchased or

8 leased to upgrade, supplement, or replace computer

9 equipment or enabling software purchased or leased in the

10 original investment that would have qualified.

11 The Department of Commerce and Economic Opportunity

12 shall grant a certificate of exemption under this item

13 (44) to qualified data centers as defined by Section

14 605-1025 of the Department of Commerce and Economic

15 Opportunity Law of the Civil Administrative Code of

16 Illinois.

17 For the purposes of this item (44):

18 "Data center" means a building or a series of

19 buildings rehabilitated or constructed to house

20 working servers in one physical location or multiple

21 sites within the State of Illinois.

22 "Qualified tangible personal property" means:

23 electrical systems and equipment; climate control and

24 chilling equipment and systems; mechanical systems and

25 equipment; monitoring and secure systems; emergency

26 generators; hardware; computers; servers; data storage

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1 devices; network connectivity equipment; racks;

2 cabinets; telecommunications cabling infrastructure;

3 raised floor systems; peripheral components or

4 systems; software; mechanical, electrical, or plumbing

5 systems; battery systems; cooling systems and towers;

6 temperature control systems; other cabling; and other

7 data center infrastructure equipment and systems

8 necessary to operate qualified tangible personal

9 property, including fixtures; and component parts of

10 any of the foregoing, including installation,

11 maintenance, repair, refurbishment, and replacement of

12 qualified tangible personal property to generate,

13 transform, transmit, distribute, or manage electricity

14 necessary to operate qualified tangible personal

15 property; and all other tangible personal property

16 that is essential to the operations of a computer data

17 center. The term "qualified tangible personal

18 property" also includes building materials physically

19 incorporated into ~~in to~~ the qualifying data center. To

20 document the exemption allowed under this Section, the

21 retailer must obtain from the purchaser a copy of the

22 certificate of eligibility issued by the Department of

23 Commerce and Economic Opportunity.

24 This item (44) is exempt from the provisions of

25 Section 2-70.

26 (45) Beginning January 1, 2020 and through December

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1 31, 2020, sales of tangible personal property made by a

2 marketplace seller over a marketplace for which tax is due

3 under this Act but for which use tax has been collected and

4 remitted to the Department by a marketplace facilitator

5 under Section 2d of the Use Tax Act are exempt from tax

6 under this Act. A marketplace seller claiming this

7 exemption shall maintain books and records demonstrating

8 that the use tax on such sales has been collected and

9 remitted by a marketplace facilitator. Marketplace sellers

10 that have properly remitted tax under this Act on such

11 sales may file a claim for credit as provided in Section 6

12 of this Act. No claim is allowed, however, for such taxes

13 for which a credit or refund has been issued to the

14 marketplace facilitator under the Use Tax Act, or for

15 which the marketplace facilitator has filed a claim for

16 credit or refund under the Use Tax Act.

17 (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;

18 101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-634, eff.

19 8-27-21; revised 11-9-21.)

20 Section 99. Effective date. This Act takes effect upon

21 becoming law.