Bill Text: IL SB1664 | 2009-2010 | 96th General Assembly | Introduced

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Bill Title: Amends the Home Rule County Retailers' Occupation Tax Law of the Counties Code and the Home Rule County Service Occupation Tax Law of the Counties Code. Provides that the maximum tax rate that is permitted under those Laws is 0.75%, unless a higher rate is authorized by referendum. Preempts home rule powers. Effective immediately.

Spectrum: Bipartisan Bill

Status: (Introduced - Dead) 2009-04-03 - Rule 3-9(a) / Re-referred to Assignments [SB1664 Detail]

Download: Illinois-2009-SB1664-Introduced.html

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96TH GENERAL ASSEMBLY State of Illinois 2009 and 2010 SB1664 Introduced 2/19/2009, by Sen. Matt Murphy SYNOPSIS AS INTRODUCED:
55 ILCS 5/5-1006 from Ch. 34, par. 5-1006
55 ILCS 5/5-1007 from Ch. 34, par. 5-1007
Amends the Home Rule County Retailers' Occupation Tax Law of the Counties Code and the Home Rule County Service Occupation Tax Law of the Counties Code. Provides that the maximum tax rate that is permitted under those Laws is 0.75%, unless a higher rate is authorized by referendum. Preempts home rule powers. Effective immediately.
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FISCAL NOTE ACT MAY APPLY HOME RULE NOTE ACT MAY APPLY STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT
A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Counties Code is amended by changing
Sections 5-1006 and 5-1007 as follows:
(55 ILCS 5/5-1006) (from Ch. 34, par. 5-1006)
Sec. 5-1006. Home Rule County Retailers' Occupation Tax
Law. Any county that is a home rule unit may impose a tax upon
all persons engaged in the business of selling tangible
personal property, other than an item of tangible personal
property titled or registered with an agency of this State's
government, at retail in the county on the gross receipts from
such sales made in the course of their business. If imposed,
this tax shall only be imposed in 1/4% increments. On and after
September 1, 1991, this additional tax may not be imposed on
the sales of food for human consumption which is to be consumed
off the premises where it is sold (other than alcoholic
beverages, soft drinks and food which has been prepared for
immediate consumption) and prescription and nonprescription
medicines, drugs, medical appliances and insulin, urine
testing materials, syringes and needles used by diabetics. The
tax imposed by a home rule county pursuant to this Section and
all civil penalties that may be assessed as an incident thereof

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shall be collected and enforced by the State Department of
Revenue. The certificate of registration that is issued by the
Department to a retailer under the Retailers' Occupation Tax
Act shall permit the retailer to engage in a business that is
taxable under any ordinance or resolution enacted pursuant to
this Section without registering separately with the
Department under such ordinance or resolution or under this
Section. The Department shall have full power to administer and
enforce this Section; to collect all taxes and penalties due
hereunder; to dispose of taxes and penalties so collected in
the manner hereinafter provided; and to determine all rights to
credit memoranda arising on account of the erroneous payment of
tax or penalty hereunder. In the administration of, and
compliance with, this Section, the Department and persons who
are subject to this Section shall have the same rights,
remedies, privileges, immunities, powers and duties, and be
subject to the same conditions, restrictions, limitations,
penalties and definitions of terms, and employ the same modes
of procedure, as are prescribed in Sections 1, 1a, 1a-1, 1d,
1e, 1f, 1i, 1j, 1k, 1m, 1n, 2 through 2-65 (in respect to all
provisions therein other than the State rate of tax), 4, 5, 5a,
5b, 5c, 5d, 5e, 5f, 5g, 5h, 5i, 5j, 5k, 5l, 6, 6a, 6b, 6c, 7, 8,
9, 10, 11, 12 and 13 of the Retailers' Occupation Tax Act and
Section 3-7 of the Uniform Penalty and Interest Act, as fully
as if those provisions were set forth herein.
No tax may be imposed by a home rule county pursuant to

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this Section unless the county also imposes a tax at the same
rate pursuant to Section 5-1007.
Persons subject to any tax imposed pursuant to the
authority granted in this Section may reimburse themselves for
their seller's tax liability hereunder by separately stating
such tax as an additional charge, which charge may be stated in
combination, in a single amount, with State tax which sellers
are required to collect under the Use Tax Act, pursuant to such
bracket schedules as the Department may prescribe.
Whenever the Department determines that a refund should be
made under this Section to a claimant instead of issuing a
credit memorandum, the Department shall notify the State
Comptroller, who shall cause the order to be drawn for the
amount specified and to the person named in the notification
from the Department. The refund shall be paid by the State
Treasurer out of the home rule county retailers' occupation tax
fund.
The Department shall forthwith pay over to the State
Treasurer, ex officio, as trustee, all taxes and penalties
collected hereunder. On or before the 25th day of each calendar
month, the Department shall prepare and certify to the
Comptroller the disbursement of stated sums of money to named
counties, the counties to be those from which retailers have
paid taxes or penalties hereunder to the Department during the
second preceding calendar month. The amount to be paid to each
county shall be the amount (not including credit memoranda)

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collected hereunder during the second preceding calendar month
by the Department plus an amount the Department determines is
necessary to offset any amounts that were erroneously paid to a
different taxing body, and not including an amount equal to the
amount of refunds made during the second preceding calendar
month by the Department on behalf of such county, and not
including any amount which the Department determines is
necessary to offset any amounts which were payable to a
different taxing body but were erroneously paid to the county.
Within 10 days after receipt, by the Comptroller, of the
disbursement certification to the counties provided for in this
Section to be given to the Comptroller by the Department, the
Comptroller shall cause the orders to be drawn for the
respective amounts in accordance with the directions contained
in the certification.
In addition to the disbursement required by the preceding
paragraph, an allocation shall be made in March of each year to
each county that received more than $500,000 in disbursements
under the preceding paragraph in the preceding calendar year.
The allocation shall be in an amount equal to the average
monthly distribution made to each such county under the
preceding paragraph during the preceding calendar year
(excluding the 2 months of highest receipts). The distribution
made in March of each year subsequent to the year in which an
allocation was made pursuant to this paragraph and the
preceding paragraph shall be reduced by the amount allocated

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and disbursed under this paragraph in the preceding calendar
year. The Department shall prepare and certify to the
Comptroller for disbursement the allocations made in
accordance with this paragraph.
For the purpose of determining the local governmental unit
whose tax is applicable, a retail sale by a producer of coal or
other mineral mined in Illinois is a sale at retail at the
place where the coal or other mineral mined in Illinois is
extracted from the earth. This paragraph does not apply to coal
or other mineral when it is delivered or shipped by the seller
to the purchaser at a point outside Illinois so that the sale
is exempt under the United States Constitution as a sale in
interstate or foreign commerce.
Nothing in this Section shall be construed to authorize a
county to impose a tax upon the privilege of engaging in any
business which under the Constitution of the United States may
not be made the subject of taxation by this State.
An ordinance or resolution imposing or discontinuing a tax
hereunder or effecting a change in the rate thereof shall be
adopted and a certified copy thereof filed with the Department
on or before the first day of June, whereupon the Department
shall proceed to administer and enforce this Section as of the
first day of September next following such adoption and filing.
Beginning January 1, 1992, an ordinance or resolution imposing
or discontinuing the tax hereunder or effecting a change in the
rate thereof shall be adopted and a certified copy thereof

SB1664 - 6 - LRB096 10735 RLJ 20920 b
filed with the Department on or before the first day of July,
whereupon the Department shall proceed to administer and
enforce this Section as of the first day of October next
following such adoption and filing. Beginning January 1, 1993,
an ordinance or resolution imposing or discontinuing the tax
hereunder or effecting a change in the rate thereof shall be
adopted and a certified copy thereof filed with the Department
on or before the first day of October, whereupon the Department
shall proceed to administer and enforce this Section as of the
first day of January next following such adoption and filing.
Beginning April 1, 1998, an ordinance or resolution imposing or
discontinuing the tax hereunder or effecting a change in the
rate thereof shall either (i) be adopted and a certified copy
thereof filed with the Department on or before the first day of
April, whereupon the Department shall proceed to administer and
enforce this Section as of the first day of July next following
the adoption and filing; or (ii) be adopted and a certified
copy thereof filed with the Department on or before the first
day of October, whereupon the Department shall proceed to
administer and enforce this Section as of the first day of
January next following the adoption and filing.
When certifying the amount of a monthly disbursement to a
county under this Section, the Department shall increase or
decrease such amount by an amount necessary to offset any
misallocation of previous disbursements. The offset amount
shall be the amount erroneously disbursed within the previous 6

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months from the time a misallocation is discovered.
Except as otherwise provided in this Section, beginning on
the first day of the first month to occur not less than 30
calendar days after the effective date of this amendatory Act
of the 96th General Assembly, the maximum rate of any tax
imposed under this Section is 0.75%. If the rate of tax exceeds
0.75% on the effective date of this amendatory Act of the 96th
General Assembly, then the rate shall be reduced to 0.75%
beginning on the first day of the first month to occur not less
than 30 calendar days after the effective date of this
amendatory Act of the 96th General Assembly. The county board
of a county that is authorized to impose a tax under this
Section may increase the rate to more than 0.75%, but only
after the question is approved by the voters of the county at
an election held in accordance with the general election law.
The county board proposing the increase shall certify the
proposition to the proper election officials who shall submit
the proposition to the voters at an election in accordance with
the general election law. The proposition shall be in
substantially the following form:
"Shall (county) be authorized to increase its
retailers' occupation tax to (percent)?"
Votes shall be recorded as "Yes" or "No". If a majority of
the votes cast on the proposition are in favor of the increase,
then the increase is authorized.
A home rule unit may not impose retailers' occupation taxes

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in a manner that is inconsistent with this Section. This
Section is a limitation of home rule powers and functions under
subsection (g) of Section 6 of Article VII of the Illinois
Constitution.
This Section shall be known and may be cited as the Home
Rule County Retailers' Occupation Tax Law.
(Source: P.A. 90-689, eff. 7-31-98; 91-51, eff. 6-30-99.)
(55 ILCS 5/5-1007) (from Ch. 34, par. 5-1007)
Sec. 5-1007. Home Rule County Service Occupation Tax Law.
The corporate authorities of a home rule county may impose a
tax upon all persons engaged, in such county, in the business
of making sales of service at the same rate of tax imposed
pursuant to Section 5-1006 of the selling price of all tangible
personal property transferred by such servicemen either in the
form of tangible personal property or in the form of real
estate as an incident to a sale of service. If imposed, such
tax shall only be imposed in 1/4% increments. On and after
September 1, 1991, this additional tax may not be imposed on
the sales of food for human consumption which is to be consumed
off the premises where it is sold (other than alcoholic
beverages, soft drinks and food which has been prepared for
immediate consumption) and prescription and nonprescription
medicines, drugs, medical appliances and insulin, urine
testing materials, syringes and needles used by diabetics. The
tax imposed by a home rule county pursuant to this Section and

SB1664 - 9 - LRB096 10735 RLJ 20920 b
all civil penalties that may be assessed as an incident thereof
shall be collected and enforced by the State Department of
Revenue. The certificate of registration which is issued by the
Department to a retailer under the Retailers' Occupation Tax
Act or under the Service Occupation Tax Act shall permit such
registrant to engage in a business which is taxable under any
ordinance or resolution enacted pursuant to this Section
without registering separately with the Department under such
ordinance or resolution or under this Section. The Department
shall have full power to administer and enforce this Section;
to collect all taxes and penalties due hereunder; to dispose of
taxes and penalties so collected in the manner hereinafter
provided; and to determine all rights to credit memoranda
arising on account of the erroneous payment of tax or penalty
hereunder. In the administration of, and compliance with, this
Section the Department and persons who are subject to this
Section shall have the same rights, remedies, privileges,
immunities, powers and duties, and be subject to the same
conditions, restrictions, limitations, penalties and
definitions of terms, and employ the same modes of procedure,
as are prescribed in Sections 1a-1, 2, 2a, 3 through 3-50 (in
respect to all provisions therein other than the State rate of
tax), 4 (except that the reference to the State shall be to the
taxing county), 5, 7, 8 (except that the jurisdiction to which
the tax shall be a debt to the extent indicated in that Section
8 shall be the taxing county), 9 (except as to the disposition

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of taxes and penalties collected, and except that the returned
merchandise credit for this county tax may not be taken against
any State tax), 10, 11, 12 (except the reference therein to
Section 2b of the Retailers' Occupation Tax Act), 13 (except
that any reference to the State shall mean the taxing county),
the first paragraph of Section 15, 16, 17, 18, 19 and 20 of the
Service Occupation Tax Act and Section 3-7 of the Uniform
Penalty and Interest Act, as fully as if those provisions were
set forth herein.
No tax may be imposed by a home rule county pursuant to
this Section unless such county also imposes a tax at the same
rate pursuant to Section 5-1006.
Persons subject to any tax imposed pursuant to the
authority granted in this Section may reimburse themselves for
their serviceman's tax liability hereunder by separately
stating such tax as an additional charge, which charge may be
stated in combination, in a single amount, with State tax which
servicemen are authorized to collect under the Service Use Tax
Act, pursuant to such bracket schedules as the Department may
prescribe.
Whenever the Department determines that a refund should be
made under this Section to a claimant instead of issuing credit
memorandum, the Department shall notify the State Comptroller,
who shall cause the order to be drawn for the amount specified,
and to the person named, in such notification from the
Department. Such refund shall be paid by the State Treasurer

SB1664 - 11 - LRB096 10735 RLJ 20920 b
out of the home rule county retailers' occupation tax fund.
The Department shall forthwith pay over to the State
Treasurer, ex-officio, as trustee, all taxes and penalties
collected hereunder. On or before the 25th day of each calendar
month, the Department shall prepare and certify to the
Comptroller the disbursement of stated sums of money to named
counties, the counties to be those from which suppliers and
servicemen have paid taxes or penalties hereunder to the
Department during the second preceding calendar month. The
amount to be paid to each county shall be the amount (not
including credit memoranda) collected hereunder during the
second preceding calendar month by the Department, and not
including an amount equal to the amount of refunds made during
the second preceding calendar month by the Department on behalf
of such county. Within 10 days after receipt, by the
Comptroller, of the disbursement certification to the counties
provided for in this Section to be given to the Comptroller by
the Department, the Comptroller shall cause the orders to be
drawn for the respective amounts in accordance with the
directions contained in such certification.
In addition to the disbursement required by the preceding
paragraph, an allocation shall be made in each year to each
county which received more than $500,000 in disbursements under
the preceding paragraph in the preceding calendar year. The
allocation shall be in an amount equal to the average monthly
distribution made to each such county under the preceding

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paragraph during the preceding calendar year (excluding the 2
months of highest receipts). The distribution made in March of
each year subsequent to the year in which an allocation was
made pursuant to this paragraph and the preceding paragraph
shall be reduced by the amount allocated and disbursed under
this paragraph in the preceding calendar year. The Department
shall prepare and certify to the Comptroller for disbursement
the allocations made in accordance with this paragraph.
Nothing in this Section shall be construed to authorize a
county to impose a tax upon the privilege of engaging in any
business which under the Constitution of the United States may
not be made the subject of taxation by this State.
An ordinance or resolution imposing or discontinuing a tax
hereunder or effecting a change in the rate thereof shall be
adopted and a certified copy thereof filed with the Department
on or before the first day of June, whereupon the Department
shall proceed to administer and enforce this Section as of the
first day of September next following such adoption and filing.
Beginning January 1, 1992, an ordinance or resolution imposing
or discontinuing the tax hereunder or effecting a change in the
rate thereof shall be adopted and a certified copy thereof
filed with the Department on or before the first day of July,
whereupon the Department shall proceed to administer and
enforce this Section as of the first day of October next
following such adoption and filing. Beginning January 1, 1993,
an ordinance or resolution imposing or discontinuing the tax

SB1664 - 13 - LRB096 10735 RLJ 20920 b
hereunder or effecting a change in the rate thereof shall be
adopted and a certified copy thereof filed with the Department
on or before the first day of October, whereupon the Department
shall proceed to administer and enforce this Section as of the
first day of January next following such adoption and filing.
Beginning April 1, 1998, an ordinance or resolution imposing or
discontinuing the tax hereunder or effecting a change in the
rate thereof shall either (i) be adopted and a certified copy
thereof filed with the Department on or before the first day of
April, whereupon the Department shall proceed to administer and
enforce this Section as of the first day of July next following
the adoption and filing; or (ii) be adopted and a certified
copy thereof filed with the Department on or before the first
day of October, whereupon the Department shall proceed to
administer and enforce this Section as of the first day of
January next following the adoption and filing.
Except as otherwise provided in this Section, beginning on
the first day of the first month to occur not less than 30
calendar days after the effective date of this amendatory Act
of the 96th General Assembly, the maximum rate of any tax
imposed under this Section is 0.75%. If the rate of tax exceeds
0.75% on the effective date of this amendatory Act of the 96th
General Assembly, then the rate shall be reduced to 0.75%
beginning on the first day of the first month to occur not less
than 30 calendar days after the effective date of this
amendatory Act of the 96th General Assembly. The county board

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of a county that is authorized to impose a tax under this
Section may increase the rate to more than 0.75%, but only
after the question is approved by the voters of the county at
an election held in accordance with the general election law.
The county board proposing the increase shall certify the
proposition to the proper election officials who shall submit
the proposition to the voters at an election in accordance with
the general election law. The proposition shall be in
substantially the following form:
"Shall (county) be authorized to increase its service
occupation tax to (percent)?"
Votes shall be recorded as "Yes" or "No". If a majority of
the votes cast on the proposition are in favor of the increase,
then the increase is authorized.
A home rule unit may not impose service occupation taxes in
a manner that is inconsistent with this Section. This Section
is a limitation of home rule powers and functions under
subsection (g) of Section 6 of Article VII of the Illinois
Constitution.
This Section shall be known and may be cited as the Home
Rule County Service Occupation Tax Law.
(Source: P.A. 90-689, eff. 7-31-98; 91-51, eff. 6-30-99.)
Section 99. Effective date. This Act takes effect upon
becoming law.