Illinois-2011-HB5326-Introduced

97TH GENERAL ASSEMBLY State of Illinois 2011 and 2012 HB5326

Introduced , by Rep. Jerry L. Mitchell

SYNOPSIS AS INTRODUCED:

`35 ILCS 105/3-5`
`35 ILCS 110/3-5`
`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, from August 15th through November 15th of each year beginning in 2012, propane used for agricultural purposes is exempt from taxation under the Acts. Effective immediately.

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FISCAL NOTE ACT MAY APPLY

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 3-5 as follows:

6 (35 ILCS 105/3-5)

7 Sec. 3-5. Exemptions. Use of the following tangible

8 personal property is exempt from the tax imposed by this Act:

9 (1) Personal property purchased from a corporation,

10 society, association, foundation, institution, or

11 organization, other than a limited liability company, that is

12 organized and operated as a not-for-profit service enterprise

13 for the benefit of persons 65 years of age or older if the

14 personal property was not purchased by the enterprise for the

15 purpose of resale by the enterprise.

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

17 Illinois county fair association for use in conducting,

18 operating, or promoting the county fair.

19 (3) Personal property purchased by a not-for-profit arts or

20 cultural organization that establishes, by proof required by

21 the Department by rule, that it has received an exemption under

22 Section 501(c)(3) of the Internal Revenue Code and that is

23 organized and operated primarily for the presentation or

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1 support of arts or cultural programming, activities, or

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

3 music and dramatic arts organizations such as symphony

4 orchestras and theatrical groups, arts and cultural service

5 organizations, local arts councils, visual arts organizations,

6 and media arts organizations. On and after the effective date

7 of this amendatory Act of the 92nd General Assembly, however,

8 an entity otherwise eligible for this exemption shall not make

9 tax-free purchases unless it has an active identification

10 number issued by the Department.

11 (4) Personal property purchased by a governmental body, by

12 a corporation, society, association, foundation, or

13 institution organized and operated exclusively for charitable,

14 religious, or educational purposes, or by a not-for-profit

15 corporation, society, association, foundation, institution, or

16 organization that has no compensated officers or employees and

17 that is organized and operated primarily for the recreation of

18 persons 55 years of age or older. A limited liability company

19 may qualify for the exemption under this paragraph only if the

20 limited liability company is organized and operated

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

22 1987, however, no entity otherwise eligible for this exemption

23 shall make tax-free purchases unless it has an active exemption

24 identification number issued by the Department.

25 (5) Until July 1, 2003, a passenger car that is a

26 replacement vehicle to the extent that the purchase price of

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1 the car is subject to the Replacement Vehicle Tax.

2 (6) 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 and

5 used, and including that manufactured on special order,

6 certified by the purchaser to be used primarily for graphic

7 arts production, and including machinery and equipment

8 purchased for lease. Equipment includes chemicals or chemicals

9 acting as catalysts but only if the chemicals or chemicals

10 acting as catalysts effect a direct and immediate change upon a

11 graphic arts product.

12 (7) Farm chemicals.

13 (8) Legal tender, currency, medallions, or gold or silver

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

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

16 country, and bullion.

17 (9) Personal property purchased from a teacher-sponsored

18 student organization affiliated with an elementary or

19 secondary school located in Illinois.

20 (10) A motor vehicle of the first division, a motor vehicle

21 of the second division that is a self-contained motor vehicle

22 designed or permanently converted to provide living quarters

23 for recreational, camping, or travel use, with direct walk

24 through to the living quarters from the driver's seat, or a

25 motor vehicle of the second division that is of the van

26 configuration designed for the transportation of not less than

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1 7 nor more than 16 passengers, as defined in Section 1-146 of

2 the Illinois Vehicle Code, that is used for automobile renting,

3 as defined in the Automobile Renting Occupation and Use Tax

4 Act.

5 (11) Farm machinery and equipment, both new and used,

6 including that manufactured on special order, certified by the

7 purchaser to be used primarily for production agriculture or

8 State or federal agricultural programs, including individual

9 replacement parts for the machinery and equipment, including

10 machinery and equipment purchased for lease, and including

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

12 Illinois Vehicle Code, farm machinery and agricultural

13 chemical and fertilizer spreaders, and nurse wagons required to

14 be registered under Section 3-809 of the Illinois Vehicle Code,

15 but excluding other motor vehicles required to be registered

16 under the Illinois Vehicle Code. Horticultural polyhouses or

17 hoop houses used for propagating, growing, or overwintering

18 plants shall be considered farm machinery and equipment under

19 this item (11). Agricultural chemical tender tanks and dry

20 boxes shall include units sold separately from a motor vehicle

21 required to be licensed and units sold mounted on a motor

22 vehicle required to be licensed if the selling price of the

23 tender is separately stated.

24 Farm machinery and equipment shall include precision

25 farming equipment that is installed or purchased to be

26 installed on farm machinery and equipment including, but not

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

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

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

4 software, global positioning and mapping systems, and other

5 such equipment.

6 Farm machinery and equipment also includes computers,

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

8 computer-assisted operation of production agriculture

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

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

11 crop data for the purpose of formulating animal diets and

12 agricultural chemicals. This item (11) is exempt from the

13 provisions of Section 3-90.

14 (12) Fuel and petroleum products sold to or used by an air

15 common carrier, certified by the carrier to be used for

16 consumption, shipment, or storage in the conduct of its

17 business as an air common carrier, for a flight destined for or

18 returning from a location or locations outside the United

19 States without regard to previous or subsequent domestic

20 stopovers.

21 (13) Proceeds of mandatory service charges separately

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

23 food and beverages purchased at retail from a retailer, to the

24 extent that the proceeds of the service charge are in fact

25 turned over as tips or as a substitute for tips to the

26 employees who participate directly in preparing, serving,

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1 hosting or cleaning up the food or beverage function with

2 respect to which the service charge is imposed.

3 (14) Until July 1, 2003, oil field exploration, drilling,

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

5 rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and

6 tubular goods, including casing and drill strings, (iii) pumps

7 and pump-jack units, (iv) storage tanks and flow lines, (v) any

8 individual replacement part for oil field exploration,

9 drilling, and production equipment, and (vi) machinery and

10 equipment purchased for lease; but excluding motor vehicles

11 required to be registered under the Illinois Vehicle Code.

12 (15) Photoprocessing machinery and equipment, including

13 repair and replacement parts, both new and used, including that

14 manufactured on special order, certified by the purchaser to be

15 used primarily for photoprocessing, and including

16 photoprocessing machinery and equipment purchased for lease.

17 (16) Until July 1, 2003, coal exploration, mining,

18 offhighway hauling, processing, maintenance, and reclamation

19 equipment, including replacement parts and equipment, and

20 including equipment purchased for lease, but excluding motor

21 vehicles required to be registered under the Illinois Vehicle

22 Code.

23 (17) Until July 1, 2003, distillation machinery and

24 equipment, sold as a unit or kit, assembled or installed by the

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

26 production of ethyl alcohol that will be used for consumption

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1 as motor fuel or as a component of motor fuel for the personal

2 use of the user, and not subject to sale or resale.

3 (18) Manufacturing and assembling machinery and equipment

4 used primarily in the process of manufacturing or assembling

5 tangible personal property for wholesale or retail sale or

6 lease, whether that sale or lease is made directly by the

7 manufacturer or by some other person, whether the materials

8 used in the process are owned by the manufacturer or some other

9 person, or whether that sale or lease is made apart from or as

10 an incident to the seller's engaging in the service occupation

11 of producing machines, tools, dies, jigs, patterns, gauges, or

12 other similar items of no commercial value on special order for

13 a particular purchaser.

14 (19) Personal property delivered to a purchaser or

15 purchaser's donee inside Illinois when the purchase order for

16 that personal property was received by a florist located

17 outside Illinois who has a florist located inside Illinois

18 deliver the personal property.

19 (20) Semen used for artificial insemination of livestock

20 for direct agricultural production.

21 (21) Horses, or interests in horses, registered with and

22 meeting the requirements of any of the Arabian Horse Club

23 Registry of America, Appaloosa Horse Club, American Quarter

24 Horse Association, United States Trotting Association, or

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

26 racing for prizes. This item (21) is exempt from the provisions

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1 of Section 3-90, and the exemption provided for under this item

2 (21) applies for all periods beginning May 30, 1995, but no

3 claim for credit or refund is allowed on or after January 1,

4 2008 for such taxes paid during the period beginning May 30,

5 2000 and ending on January 1, 2008.

6 (22) Computers and communications equipment utilized for

7 any hospital purpose and equipment used in the diagnosis,

8 analysis, or treatment of hospital patients purchased by a

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

10 longer executed or in effect at the time the lessor would

11 otherwise be subject to the tax imposed by this Act, to a

12 hospital that has been issued an active tax exemption

13 identification number by the Department under Section 1g of the

14 Retailers' Occupation Tax Act. If the equipment is leased in a

15 manner that does not qualify for this exemption or is used in

16 any other non-exempt manner, the lessor shall be liable for the

17 tax imposed under this Act or the Service Use Tax Act, as the

18 case may be, based on the fair market value of the property at

19 the time the non-qualifying use occurs. No lessor shall collect

20 or attempt to collect an amount (however designated) that

21 purports to reimburse that lessor for the tax imposed by this

22 Act or the Service Use Tax Act, as the case may be, if the tax

23 has not been paid by the lessor. If a lessor improperly

24 collects any such amount from the lessee, the lessee shall have

25 a legal right to claim a refund of that amount from the lessor.

26 If, however, that amount is not refunded to the lessee for any

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1 reason, the lessor is liable to pay that amount to the

2 Department.

3 (23) Personal property purchased by a lessor who leases the

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

5 effect at the time the lessor would otherwise be subject to the

6 tax imposed by this Act, to a governmental body that has been

7 issued an active sales tax exemption identification number by

8 the Department under Section 1g of the Retailers' Occupation

9 Tax Act. If the property is leased in a manner that does not

10 qualify for this exemption or used in any other non-exempt

11 manner, the lessor shall be liable for the tax imposed under

12 this Act or the Service Use Tax Act, as the case may be, based

13 on the fair market value of the property at the time the

14 non-qualifying use occurs. No lessor shall collect or attempt

15 to collect an amount (however designated) that purports to

16 reimburse that lessor for the tax imposed by this Act or the

17 Service Use Tax Act, as the case may be, if the tax has not been

18 paid by the lessor. If a lessor improperly collects any such

19 amount from the lessee, the lessee shall have a legal right to

20 claim a refund of that amount from the lessor. If, however,

21 that amount is not refunded to the lessee for any reason, the

22 lessor is liable to pay that amount to the Department.

23 (24) Beginning with taxable years ending on or after

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

25 before December 31, 2004, personal property that is donated for

26 disaster relief to be used in a State or federally declared

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1 disaster area in Illinois or bordering Illinois by a

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

3 corporation, society, association, foundation, or institution

4 that has been issued a sales tax exemption identification

5 number by the Department that assists victims of the disaster

6 who reside within the declared disaster area.

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

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

9 before December 31, 2004, personal property that is used in the

10 performance of infrastructure repairs in this State, including

11 but not limited to municipal roads and streets, access roads,

12 bridges, sidewalks, waste disposal systems, water and sewer

13 line extensions, water distribution and purification

14 facilities, storm water drainage and retention facilities, and

15 sewage treatment facilities, resulting from a State or

16 federally declared disaster in Illinois or bordering Illinois

17 when such repairs are initiated on facilities located in the

18 declared disaster area within 6 months after the disaster.

19 (26) Beginning July 1, 1999, game or game birds purchased

20 at a "game breeding and hunting preserve area" as that term is

21 used in the Wildlife Code. This paragraph is exempt from the

22 provisions of Section 3-90.

23 (27) A motor vehicle, as that term is defined in Section

24 1-146 of the Illinois Vehicle Code, that is donated to a

25 corporation, limited liability company, society, association,

26 foundation, or institution that is determined by the Department

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1 to be organized and operated exclusively for educational

2 purposes. For purposes of this exemption, "a corporation,

3 limited liability company, society, association, foundation,

4 or institution organized and operated exclusively for

5 educational purposes" means all tax-supported public schools,

6 private schools that offer systematic instruction in useful

7 branches of learning by methods common to public schools and

8 that compare favorably in their scope and intensity with the

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

10 vocational or technical schools or institutes organized and

11 operated exclusively to provide a course of study of not less

12 than 6 weeks duration and designed to prepare individuals to

13 follow a trade or to pursue a manual, technical, mechanical,

14 industrial, business, or commercial occupation.

15 (28) Beginning January 1, 2000, personal property,

16 including food, purchased through fundraising events for the

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

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

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

20 district that consists primarily of volunteers and includes

21 parents and teachers of the school children. This paragraph

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

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

24 entity purchases the personal property sold at the events from

25 another individual or entity that sold the property for the

26 purpose of resale by the fundraising entity and that profits

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

2 exempt from the provisions of Section 3-90.

3 (29) Beginning January 1, 2000 and through December 31,

4 2001, new or used automatic vending machines that prepare and

5 serve hot food and beverages, including coffee, soup, and other

6 items, and replacement parts for these machines. Beginning

7 January 1, 2002 and through June 30, 2003, machines and parts

8 for machines used in commercial, coin-operated amusement and

9 vending business if a use or occupation tax is paid on the

10 gross receipts derived from the use of the commercial,

11 coin-operated amusement and vending machines. This paragraph

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

13 (30) Beginning January 1, 2001 and through June 30, 2011,

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

15 premises where it is sold (other than alcoholic beverages, soft

16 drinks, and food that has been prepared for immediate

17 consumption) and prescription and nonprescription medicines,

18 drugs, medical appliances, and insulin, urine testing

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

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

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

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

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

24 in the ID/DD Community Care Act or the Specialized Mental

25 Health Rehabilitation Act.

26 (31) Beginning on the effective date of this amendatory Act

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1 of the 92nd General Assembly, computers and communications

2 equipment utilized for any hospital purpose and equipment used

3 in the diagnosis, analysis, or treatment of hospital patients

4 purchased by a lessor who leases the equipment, under a lease

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

6 lessor would otherwise be subject to the tax imposed by this

7 Act, to a hospital that has been issued an active tax exemption

8 identification number by the Department under Section 1g of the

9 Retailers' Occupation Tax Act. If the equipment is leased in a

10 manner that does not qualify for this exemption or is used in

11 any other nonexempt manner, the lessor shall be liable for the

12 tax imposed under this Act or the Service Use Tax Act, as the

13 case may be, based on the fair market value of the property at

14 the time the nonqualifying use occurs. No lessor shall collect

15 or attempt to collect an amount (however designated) that

16 purports to reimburse that lessor for the tax imposed by this

17 Act or the Service Use Tax Act, as the case may be, if the tax

18 has not been paid by the lessor. If a lessor improperly

19 collects any such amount from the lessee, the lessee shall have

20 a legal right to claim a refund of that amount from the lessor.

21 If, however, that amount is not refunded to the lessee for any

22 reason, the lessor is liable to pay that amount to the

23 Department. This paragraph is exempt from the provisions of

24 Section 3-90.

25 (32) Beginning on the effective date of this amendatory Act

26 of the 92nd General Assembly, personal property purchased by a

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1 lessor who leases the property, under a lease of one year or

2 longer executed or in effect at the time the lessor would

3 otherwise be subject to the tax imposed by this Act, to a

4 governmental body that has been issued an active sales tax

5 exemption identification number by the Department under

6 Section 1g of the Retailers' Occupation Tax Act. If the

7 property is leased in a manner that does not qualify for this

8 exemption or used in any other nonexempt manner, the lessor

9 shall be liable for the tax imposed under this Act or the

10 Service Use Tax Act, as the case may be, based on the fair

11 market value of the property at the time the nonqualifying use

12 occurs. No lessor shall collect or attempt to collect an amount

13 (however designated) that purports to reimburse that lessor for

14 the tax imposed by this Act or the Service Use Tax Act, as the

15 case may be, if the tax has not been paid by the lessor. If a

16 lessor improperly collects any such amount from the lessee, the

17 lessee shall have a legal right to claim a refund of that

18 amount from the lessor. If, however, that amount is not

19 refunded to the lessee for any reason, the lessor is liable to

20 pay that amount to the Department. This paragraph is exempt

21 from the provisions of Section 3-90.

22 (33) On and after July 1, 2003 and through June 30, 2004,

23 the use in this State of motor vehicles of the second division

24 with a gross vehicle weight in excess of 8,000 pounds and that

25 are subject to the commercial distribution fee imposed under

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

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

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

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

4 to the commercial distribution fee imposed under Section

5 3-815.1 of the Illinois Vehicle Code; and (iii) that are

6 primarily used for commercial purposes. Through June 30, 2005,

7 this exemption applies to repair and replacement parts added

8 after the initial purchase of such a motor vehicle if that

9 motor vehicle is used in a manner that would qualify for the

10 rolling stock exemption otherwise provided for in this Act. For

11 purposes of this paragraph, the term "used for commercial

12 purposes" means the transportation of persons or property in

13 furtherance of any commercial or industrial enterprise,

14 whether for-hire or not.

15 (34) Beginning January 1, 2008, tangible personal property

16 used in the construction or maintenance of a community water

17 supply, as defined under Section 3.145 of the Environmental

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

19 corporation that holds a valid water supply permit issued under

20 Title IV of the Environmental Protection Act. This paragraph is

21 exempt from the provisions of Section 3-90.

22 (35) Beginning January 1, 2010, materials, parts,

23 equipment, components, and furnishings incorporated into or

24 upon an aircraft as part of the modification, refurbishment,

25 completion, replacement, repair, or maintenance of the

26 aircraft. This exemption includes consumable supplies used in

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1 the modification, refurbishment, completion, replacement,

2 repair, and maintenance of aircraft, but excludes any

3 materials, parts, equipment, components, and consumable

4 supplies used in the modification, replacement, repair, and

5 maintenance of aircraft engines or power plants, whether such

6 engines or power plants are installed or uninstalled upon any

7 such aircraft. "Consumable supplies" include, but are not

8 limited to, adhesive, tape, sandpaper, general purpose

9 lubricants, cleaning solution, latex gloves, and protective

10 films. This exemption applies only to those organizations that

11 (i) hold an Air Agency Certificate and are empowered to operate

12 an approved repair station by the Federal Aviation

13 Administration, (ii) have a Class IV Rating, and (iii) conduct

14 operations in accordance with Part 145 of the Federal Aviation

15 Regulations. The exemption does not include aircraft operated

16 by a commercial air carrier providing scheduled passenger air

17 service pursuant to authority issued under Part 121 or Part 129

18 of the Federal Aviation Regulations.

19 (36) Tangible personal property purchased by a

20 public-facilities corporation, as described in Section

21 11-65-10 of the Illinois Municipal Code, for purposes of

22 constructing or furnishing a municipal convention hall, but

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

24 transferred to the municipality without any further

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

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

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1 retirement or redemption of any bonds or other debt instruments

2 issued by the public-facilities corporation in connection with

3 the development of the municipal convention hall. This

4 exemption includes existing public-facilities corporations as

5 provided in Section 11-65-25 of the Illinois Municipal Code.

6 This paragraph is exempt from the provisions of Section 3-90.

7 (37) From August 15th through November 15th of each year

8 beginning in 2012, propane used for agricultural purposes. This

9 paragraph is exempt from the provisions of Section 3-90.

10 (Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;

11 96-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.

12 7-2-10; 97-38, eff. 6-28-11; 97-227, eff. 1-1-12; 97-431, eff.

13 8-16-11; revised 9-12-11.)

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

15 Section 3-5 as follows:

16 (35 ILCS 110/3-5)

17 Sec. 3-5. Exemptions. Use of the following tangible

18 personal property is exempt from the tax imposed by this Act:

19 (1) Personal property purchased from a corporation,

20 society, association, foundation, institution, or

21 organization, other than a limited liability company, that is

22 organized and operated as a not-for-profit service enterprise

23 for the benefit of persons 65 years of age or older if the

24 personal property was not purchased by the enterprise for the

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1 purpose of resale by the enterprise.

2 (2) Personal property purchased by a non-profit Illinois

3 county fair association for use in conducting, operating, or

4 promoting the county fair.

5 (3) Personal property purchased by a not-for-profit arts or

6 cultural organization that establishes, by proof required by

7 the Department by rule, that it has received an exemption under

8 Section 501(c)(3) of the Internal Revenue Code and that is

9 organized and operated primarily for the presentation or

10 support of arts or cultural programming, activities, or

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

12 music and dramatic arts organizations such as symphony

13 orchestras and theatrical groups, arts and cultural service

14 organizations, local arts councils, visual arts organizations,

15 and media arts organizations. On and after the effective date

16 of this amendatory Act of the 92nd General Assembly, however,

17 an entity otherwise eligible for this exemption shall not make

18 tax-free purchases unless it has an active identification

19 number issued by the Department.

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

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

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

23 country, and bullion.

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

25 2004 through August 30, 2014, graphic arts machinery and

26 equipment, including repair and replacement parts, both new and

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1 used, and including that manufactured on special order or

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

3 primarily for graphic arts production. Equipment includes

4 chemicals or chemicals acting as catalysts but only if the

5 chemicals or chemicals acting as catalysts effect a direct and

6 immediate change upon a graphic arts product.

7 (6) Personal property purchased from a teacher-sponsored

8 student organization affiliated with an elementary or

9 secondary school located in Illinois.

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

11 including that manufactured on special order, certified by the

12 purchaser to be used primarily for production agriculture or

13 State or federal agricultural programs, including individual

14 replacement parts for the machinery and equipment, including

15 machinery and equipment purchased for lease, and including

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

17 Illinois Vehicle Code, farm machinery and agricultural

18 chemical and fertilizer spreaders, and nurse wagons required to

19 be registered under Section 3-809 of the Illinois Vehicle Code,

20 but excluding other motor vehicles required to be registered

21 under the Illinois Vehicle Code. Horticultural polyhouses or

22 hoop houses used for propagating, growing, or overwintering

23 plants shall be considered farm machinery and equipment under

24 this item (7). Agricultural chemical tender tanks and dry boxes

25 shall include units sold separately from a motor vehicle

26 required to be licensed and units sold mounted on a motor

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1 vehicle required to be licensed if the selling price of the

2 tender is separately stated.

3 Farm machinery and equipment shall include precision

4 farming equipment that is installed or purchased to be

5 installed on farm machinery and equipment including, but not

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

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

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

9 software, global positioning and mapping systems, and other

10 such equipment.

11 Farm machinery and equipment also includes computers,

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

13 computer-assisted operation of production agriculture

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

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

16 crop data for the purpose of formulating animal diets and

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

18 provisions of Section 3-75.

19 (8) Fuel and petroleum products sold to or used by an air

20 common carrier, certified by the carrier to be used for

21 consumption, shipment, or storage in the conduct of its

22 business as an air common carrier, for a flight destined for or

23 returning from a location or locations outside the United

24 States without regard to previous or subsequent domestic

25 stopovers.

26 (9) Proceeds of mandatory service charges separately

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

2 food and beverages acquired as an incident to the purchase of a

3 service from a serviceman, to the extent that the proceeds of

4 the service charge are in fact turned over as tips or as a

5 substitute for tips to the employees who participate directly

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

7 beverage function with respect to which the service charge is

8 imposed.

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

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

11 rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and

12 tubular goods, including casing and drill strings, (iii) pumps

13 and pump-jack units, (iv) storage tanks and flow lines, (v) any

14 individual replacement part for oil field exploration,

15 drilling, and production equipment, and (vi) machinery and

16 equipment purchased for lease; but excluding motor vehicles

17 required to be registered under the Illinois Vehicle Code.

18 (11) Proceeds from the sale of photoprocessing machinery

19 and equipment, including repair and replacement parts, both new

20 and used, including that manufactured on special order,

21 certified by the purchaser to be used primarily for

22 photoprocessing, and including photoprocessing machinery and

23 equipment purchased for lease.

24 (12) Until July 1, 2003, coal exploration, mining,

25 offhighway hauling, processing, maintenance, and reclamation

26 equipment, including replacement parts and equipment, and

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1 including equipment purchased for lease, but excluding motor

2 vehicles required to be registered under the Illinois Vehicle

3 Code.

4 (13) Semen used for artificial insemination of livestock

5 for direct agricultural production.

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

7 meeting the requirements of any of the Arabian Horse Club

8 Registry of America, Appaloosa Horse Club, American Quarter

9 Horse Association, United States Trotting Association, or

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

11 racing for prizes. This item (14) is exempt from the provisions

12 of Section 3-75, and the exemption provided for under this item

13 (14) applies for all periods beginning May 30, 1995, but no

14 claim for credit or refund is allowed on or after the effective

15 date of this amendatory Act of the 95th General Assembly for

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

17 ending on the effective date of this amendatory Act of the 95th

18 General Assembly.

19 (15) Computers and communications equipment utilized for

20 any hospital purpose and equipment used in the diagnosis,

21 analysis, or treatment of hospital patients purchased by a

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

23 longer executed or in effect at the time the lessor would

24 otherwise be subject to the tax imposed by this Act, to a

25 hospital that has been issued an active tax exemption

26 identification number by the Department under Section 1g of the

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1 Retailers' Occupation Tax Act. If the equipment is leased in a

2 manner that does not qualify for this exemption or is used in

3 any other non-exempt manner, the lessor shall be liable for the

4 tax imposed under this Act or the Use Tax Act, as the case may

5 be, based on the fair market value of the property at the time

6 the non-qualifying use occurs. No lessor shall collect or

7 attempt to collect an amount (however designated) that purports

8 to reimburse that lessor for the tax imposed by this Act or the

9 Use Tax Act, as the case may be, if the tax has not been paid by

10 the lessor. If a lessor improperly collects any such amount

11 from the lessee, the lessee shall have a legal right to claim a

12 refund of that amount from the lessor. If, however, that amount

13 is not refunded to the lessee for any reason, the lessor is

14 liable to pay that amount to the Department.

15 (16) Personal property purchased by a lessor who leases the

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

17 effect at the time the lessor would otherwise be subject to the

18 tax imposed by this Act, to a governmental body that has been

19 issued an active tax exemption identification number by the

20 Department under Section 1g of the Retailers' Occupation Tax

21 Act. If the property is leased in a manner that does not

22 qualify for this exemption or is used in any other non-exempt

23 manner, the lessor shall be liable for the tax imposed under

24 this Act or the Use Tax Act, as the case may be, based on the

25 fair market value of the property at the time the

26 non-qualifying use occurs. No lessor shall collect or attempt

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1 to collect an amount (however designated) that purports to

2 reimburse that lessor for the tax imposed by this Act or the

3 Use Tax Act, as the case may be, if the tax has not been paid by

4 the lessor. If a lessor improperly collects any such amount

5 from the lessee, the lessee shall have a legal right to claim a

6 refund of that amount from the lessor. If, however, that amount

7 is not refunded to the lessee for any reason, the lessor is

8 liable to pay that amount to the Department.

9 (17) Beginning with taxable years ending on or after

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

11 before December 31, 2004, personal property that is donated for

12 disaster relief to be used in a State or federally declared

13 disaster area in Illinois or bordering Illinois by a

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

15 corporation, society, association, foundation, or institution

16 that has been issued a sales tax exemption identification

17 number by the Department that assists victims of the disaster

18 who reside within the declared disaster area.

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

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

21 before December 31, 2004, personal property that is used in the

22 performance of infrastructure repairs in this State, including

23 but not limited to municipal roads and streets, access roads,

24 bridges, sidewalks, waste disposal systems, water and sewer

25 line extensions, water distribution and purification

26 facilities, storm water drainage and retention facilities, and

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1 sewage treatment facilities, resulting from a State or

2 federally declared disaster in Illinois or bordering Illinois

3 when such repairs are initiated on facilities located in the

4 declared disaster area within 6 months after the disaster.

5 (19) Beginning July 1, 1999, game or game birds purchased

6 at a "game breeding and hunting preserve area" as that term is

7 used in the Wildlife Code. This paragraph is exempt from the

8 provisions of Section 3-75.

9 (20) A motor vehicle, as that term is defined in Section

10 1-146 of the Illinois Vehicle Code, that is donated to a

11 corporation, limited liability company, society, association,

12 foundation, or institution that is determined by the Department

13 to be organized and operated exclusively for educational

14 purposes. For purposes of this exemption, "a corporation,

15 limited liability company, society, association, foundation,

16 or institution organized and operated exclusively for

17 educational purposes" means all tax-supported public schools,

18 private schools that offer systematic instruction in useful

19 branches of learning by methods common to public schools and

20 that compare favorably in their scope and intensity with the

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

22 vocational or technical schools or institutes organized and

23 operated exclusively to provide a course of study of not less

24 than 6 weeks duration and designed to prepare individuals to

25 follow a trade or to pursue a manual, technical, mechanical,

26 industrial, business, or commercial occupation.

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

2 including food, purchased through fundraising events for the

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

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

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

6 district that consists primarily of volunteers and includes

7 parents and teachers of the school children. This paragraph

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

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

10 entity purchases the personal property sold at the events from

11 another individual or entity that sold the property for the

12 purpose of resale by the fundraising entity and that profits

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

14 exempt from the provisions of Section 3-75.

15 (22) Beginning January 1, 2000 and through December 31,

16 2001, new or used automatic vending machines that prepare and

17 serve hot food and beverages, including coffee, soup, and other

18 items, and replacement parts for these machines. Beginning

19 January 1, 2002 and through June 30, 2003, machines and parts

20 for machines used in commercial, coin-operated amusement and

21 vending business if a use or occupation tax is paid on the

22 gross receipts derived from the use of the commercial,

23 coin-operated amusement and vending machines. This paragraph

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

25 (23) Beginning August 23, 2001 and through June 30, 2011,

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, soft

2 drinks, and food that has been prepared for immediate

3 consumption) and prescription and nonprescription 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 or the Specialized Mental

11 Health Rehabilitation Act.

12 (24) Beginning on the effective date of this amendatory Act

13 of the 92nd General Assembly, computers and communications

14 equipment utilized for any hospital purpose and equipment used

15 in the diagnosis, analysis, or treatment of hospital patients

16 purchased by a lessor who leases the equipment, under a lease

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

18 lessor would otherwise be subject to the tax imposed by this

19 Act, to a hospital that has been issued an active tax exemption

20 identification number by the Department under Section 1g of the

21 Retailers' Occupation Tax Act. If the equipment is leased in a

22 manner that does not qualify for this exemption or is used in

23 any other nonexempt manner, the lessor shall be liable for the

24 tax imposed under this Act or the Use Tax Act, as the case may

25 be, based on the fair market value of the property at the time

26 the nonqualifying use occurs. No lessor shall collect or

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1 attempt to collect an amount (however designated) that purports

2 to reimburse that lessor for the tax imposed by this Act or the

3 Use Tax Act, as the case may be, if the tax has not been paid by

4 the lessor. If a lessor improperly collects any such amount

5 from the lessee, the lessee shall have a legal right to claim a

6 refund of that amount from the lessor. If, however, that amount

7 is not refunded to the lessee for any reason, the lessor is

8 liable to pay that amount to the Department. This paragraph is

9 exempt from the provisions of Section 3-75.

10 (25) Beginning on the effective date of this amendatory Act

11 of the 92nd General Assembly, personal property purchased by a

12 lessor who leases the property, under a lease of one year or

13 longer executed or in effect at the time the lessor would

14 otherwise be subject to the tax imposed by this Act, to a

15 governmental body that has been issued an active tax exemption

16 identification number by the Department under Section 1g of the

17 Retailers' Occupation Tax Act. If the property is leased in a

18 manner that does not qualify for this exemption or is used in

19 any other nonexempt manner, the lessor shall be liable for the

20 tax imposed under this Act or the Use Tax Act, as the case may

21 be, based on the fair market value of the property at the time

22 the nonqualifying use occurs. No lessor shall collect or

23 attempt to collect an amount (however designated) that purports

24 to reimburse that lessor for the tax imposed by this Act or the

25 Use Tax Act, as the case may be, if the tax has not been paid by

26 the lessor. If a lessor improperly collects any such amount

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1 from the lessee, the lessee shall have a legal right to claim a

2 refund of that amount from the lessor. If, however, that amount

3 is not refunded to the lessee for any reason, the lessor is

4 liable to pay that amount to the Department. This paragraph is

5 exempt from the provisions of Section 3-75.

6 (26) Beginning January 1, 2008, tangible personal property

7 used in the construction or maintenance of a community water

8 supply, as defined under Section 3.145 of the Environmental

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

10 corporation that holds a valid water supply permit issued under

11 Title IV of the Environmental Protection Act. This paragraph is

12 exempt from the provisions of Section 3-75.

13 (27) Beginning January 1, 2010, materials, parts,

14 equipment, components, and furnishings incorporated into or

15 upon an aircraft as part of the modification, refurbishment,

16 completion, replacement, repair, or maintenance of the

17 aircraft. This exemption includes consumable supplies used in

18 the modification, refurbishment, completion, replacement,

19 repair, and maintenance of aircraft, but excludes any

20 materials, parts, equipment, components, and consumable

21 supplies used in the modification, replacement, repair, and

22 maintenance of aircraft engines or power plants, whether such

23 engines or power plants are installed or uninstalled upon any

24 such aircraft. "Consumable supplies" include, but are not

25 limited to, adhesive, tape, sandpaper, general purpose

26 lubricants, cleaning solution, latex gloves, and protective

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1 films. This exemption applies only to those organizations that

2 (i) hold an Air Agency Certificate and are empowered to operate

3 an approved repair station by the Federal Aviation

4 Administration, (ii) have a Class IV Rating, and (iii) conduct

5 operations in accordance with Part 145 of the Federal Aviation

6 Regulations. The exemption does not include aircraft operated

7 by a commercial air carrier providing scheduled passenger air

8 service pursuant to authority issued under Part 121 or Part 129

9 of the Federal Aviation Regulations.

10 (28) Tangible personal property purchased by a

11 public-facilities corporation, as described in Section

12 11-65-10 of the Illinois Municipal Code, for purposes of

13 constructing or furnishing a municipal convention hall, but

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

15 transferred to the municipality without any further

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

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

18 retirement or redemption of any bonds or other debt instruments

19 issued by the public-facilities corporation in connection with

20 the development of the municipal convention hall. This

21 exemption includes existing public-facilities corporations as

22 provided in Section 11-65-25 of the Illinois Municipal Code.

23 This paragraph is exempt from the provisions of Section 3-75.

24 (29) From August 15th through November 15th of each year

25 beginning in 2012, propane used for agricultural purposes. This

26 paragraph is exempt from the provisions of Section 3-75.

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1 (Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;

2 96-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.

3 7-2-10; 97-38, eff. 6-28-11; 97-227, eff. 1-1-12; 97-431, eff.

4 8-16-11; revised 9-12-11.)

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

6 changing Section 3-5 as follows:

7 (35 ILCS 115/3-5)

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

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

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

11 association, foundation, institution, or organization, other

12 than a limited liability company, that is organized and

13 operated as a not-for-profit service enterprise for the benefit

14 of persons 65 years of age or older if the personal property

15 was not purchased by the enterprise for the purpose of resale

16 by the enterprise.

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

18 Illinois county fair association for use in conducting,

19 operating, or promoting the county fair.

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

21 or cultural organization that establishes, by proof required by

22 the Department by rule, that it has received an exemption under

23 Section 501(c)(3) of the Internal Revenue Code and that is

24 organized and operated primarily for the presentation or

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1 support of arts or cultural programming, activities, or

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

3 music and dramatic arts organizations such as symphony

4 orchestras and theatrical groups, arts and cultural service

5 organizations, local arts councils, visual arts organizations,

6 and media arts organizations. On and after the effective date

7 of this amendatory Act of the 92nd General Assembly, however,

8 an entity otherwise eligible for this exemption shall not make

9 tax-free purchases unless it has an active identification

10 number issued by the Department.

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

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

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

14 country, and bullion.

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

16 2004 through August 30, 2014, graphic arts machinery and

17 equipment, including repair and replacement parts, both new and

18 used, and including that manufactured on special order or

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

20 primarily for graphic arts production. Equipment includes

21 chemicals or chemicals acting as catalysts but only if the

22 chemicals or chemicals acting as catalysts effect a direct and

23 immediate change upon a graphic arts product.

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

25 organization affiliated with an elementary or secondary school

26 located in Illinois.

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

2 including that manufactured on special order, certified by the

3 purchaser to be used primarily for production agriculture or

4 State or federal agricultural programs, including individual

5 replacement parts for the machinery and equipment, including

6 machinery and equipment purchased for lease, and including

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

8 Illinois Vehicle Code, farm machinery and agricultural

9 chemical and fertilizer spreaders, and nurse wagons required to

10 be registered under Section 3-809 of the Illinois Vehicle Code,

11 but excluding other motor vehicles required to be registered

12 under the Illinois Vehicle Code. Horticultural polyhouses or

13 hoop houses used for propagating, growing, or overwintering

14 plants shall be considered farm machinery and equipment under

15 this item (7). Agricultural chemical tender tanks and dry boxes

16 shall include units sold separately from a motor vehicle

17 required to be licensed and units sold mounted on a motor

18 vehicle required to be licensed if the selling price of the

19 tender is separately stated.

20 Farm machinery and equipment shall include precision

21 farming equipment that is installed or purchased to be

22 installed on farm machinery and equipment including, but not

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

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

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

26 software, global positioning and mapping systems, and other

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1 such equipment.

2 Farm machinery and equipment also includes computers,

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

4 computer-assisted operation of production agriculture

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

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

7 crop data for the purpose of formulating animal diets and

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

9 provisions of Section 3-55.

10 (8) Fuel and petroleum products sold to or used by an air

11 common carrier, certified by the carrier to be used for

12 consumption, shipment, or storage in the conduct of its

13 business as an air common carrier, for a flight destined for or

14 returning from a location or locations outside the United

15 States without regard to previous or subsequent domestic

16 stopovers.

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 rigs,

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

2 tubular goods, including casing and drill strings, (iii) pumps

3 and pump-jack units, (iv) storage tanks and flow lines, (v) any

4 individual replacement part for oil field exploration,

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

6 equipment purchased for lease; but excluding motor vehicles

7 required to be registered under the Illinois Vehicle Code.

8 (11) Photoprocessing machinery and equipment, including

9 repair and replacement parts, both new and used, including that

10 manufactured on special order, certified by the purchaser to be

11 used primarily for photoprocessing, and including

12 photoprocessing machinery and equipment purchased for lease.

13 (12) Until July 1, 2003, coal exploration, mining,

14 offhighway hauling, processing, maintenance, and reclamation

15 equipment, including replacement parts and equipment, and

16 including equipment purchased for lease, but excluding motor

17 vehicles required to be registered under the Illinois Vehicle

18 Code.

19 (13) Beginning January 1, 1992 and through June 30, 2011,

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

21 premises where it is sold (other than alcoholic beverages, soft

22 drinks and food that has been prepared for immediate

23 consumption) and prescription and non-prescription medicines,

24 drugs, medical appliances, and insulin, urine testing

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

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

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

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

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

4 in the ID/DD Community Care Act or the Specialized Mental

5 Health Rehabilitation Act.

6 (14) Semen used for artificial insemination of livestock

7 for direct agricultural production.

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

9 meeting the requirements of any of the Arabian Horse Club

10 Registry of America, Appaloosa Horse Club, American Quarter

11 Horse Association, United States Trotting Association, or

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

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

14 of Section 3-55, and the exemption provided for under this item

15 (15) applies for all periods beginning May 30, 1995, but no

16 claim for credit or refund is allowed on or after January 1,

17 2008 (the effective date of Public Act 95-88) for such taxes

18 paid during the period beginning May 30, 2000 and ending on

19 January 1, 2008 (the effective date of Public Act 95-88).

20 (16) Computers and communications equipment utilized for

21 any hospital purpose and equipment used in the diagnosis,

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

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

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

25 hospital that has been issued an active tax exemption

26 identification number by the Department under Section 1g of the

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1 Retailers' Occupation Tax Act.

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

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

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

5 has been issued an active tax exemption identification number

6 by the Department under Section 1g of the Retailers' Occupation

7 Tax Act.

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

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

10 before December 31, 2004, personal property that is donated for

11 disaster relief to be used in a State or federally declared

12 disaster area in Illinois or bordering Illinois by a

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

14 corporation, society, association, foundation, or institution

15 that has been issued a sales tax exemption identification

16 number by the Department that assists victims of the disaster

17 who reside within the declared disaster area.

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

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

20 before December 31, 2004, personal property that is used in the

21 performance of infrastructure repairs in this State, including

22 but not limited to municipal roads and streets, access roads,

23 bridges, sidewalks, waste disposal systems, water and sewer

24 line extensions, water distribution and purification

25 facilities, storm water drainage and retention facilities, and

26 sewage treatment facilities, resulting from a State or

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1 federally declared disaster in Illinois or bordering Illinois

2 when such repairs are initiated on facilities located in the

3 declared disaster area within 6 months after the disaster.

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

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

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

7 provisions of Section 3-55.

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

9 1-146 of the Illinois Vehicle Code, that is donated to a

10 corporation, limited liability company, society, association,

11 foundation, or institution that is determined by the Department

12 to be organized and operated exclusively for educational

13 purposes. For purposes of this exemption, "a corporation,

14 limited liability company, society, association, foundation,

15 or institution organized and operated exclusively for

16 educational purposes" means all tax-supported public schools,

17 private schools that offer systematic instruction in useful

18 branches of learning by methods common to public schools and

19 that 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 and

22 operated exclusively to provide a course of study of not less

23 than 6 weeks duration and designed to prepare individuals to

24 follow a trade or to pursue a manual, technical, mechanical,

25 industrial, business, or commercial occupation.

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

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1 including food, purchased through fundraising events for the

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

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

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

5 district that consists primarily of volunteers and includes

6 parents and teachers of the school children. This paragraph

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

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

9 entity purchases the personal property sold at the events from

10 another individual or entity that sold the property for the

11 purpose of resale by the fundraising entity and that profits

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

13 exempt from the provisions of Section 3-55.

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

15 2001, new or used automatic vending machines that prepare and

16 serve hot food and beverages, including coffee, soup, and other

17 items, and replacement parts for these machines. Beginning

18 January 1, 2002 and through June 30, 2003, machines and parts

19 for machines used in commercial, coin-operated amusement and

20 vending business if a use or occupation tax is paid on the

21 gross receipts derived from the use of the commercial,

22 coin-operated amusement and vending machines. This paragraph

23 is exempt from the provisions of Section 3-55.

24 (24) Beginning on the effective date of this amendatory Act

25 of the 92nd General Assembly, computers and communications

26 equipment utilized for any hospital purpose and equipment used

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1 in the diagnosis, analysis, or treatment of hospital patients

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

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

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

5 exemption identification number by the Department under

6 Section 1g of the Retailers' Occupation Tax Act. This paragraph

7 is exempt from the provisions of Section 3-55.

8 (25) Beginning on the effective date of this amendatory Act

9 of the 92nd General Assembly, personal property sold to a

10 lessor who leases the property, under a lease of one year or

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

12 governmental body that has been issued an active tax exemption

13 identification number by the Department under Section 1g of the

14 Retailers' Occupation Tax Act. This paragraph is exempt from

15 the provisions of Section 3-55.

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

17 2016, tangible personal property purchased from an Illinois

18 retailer by a taxpayer engaged in centralized purchasing

19 activities in Illinois who will, upon receipt of the property

20 in Illinois, temporarily store the property in Illinois (i) for

21 the purpose of subsequently transporting it outside this State

22 for use or consumption thereafter solely outside this State or

23 (ii) for the purpose of being processed, fabricated, or

24 manufactured into, attached to, or incorporated into other

25 tangible personal property to be transported outside this State

26 and thereafter used or consumed solely outside this State. The

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1 Director of Revenue shall, pursuant to rules adopted in

2 accordance with the Illinois Administrative Procedure Act,

3 issue a permit to any taxpayer in good standing with the

4 Department who is eligible for the exemption under this

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

6 shall authorize the holder, to the extent and in the manner

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

8 tangible personal property from a retailer exempt from the

9 taxes imposed by this Act. Taxpayers shall maintain all

10 necessary books and records to substantiate the use and

11 consumption of all such tangible personal property outside of

12 the State of Illinois.

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

14 used in the construction or maintenance of a community water

15 supply, as defined under Section 3.145 of the Environmental

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

17 corporation that holds a valid water supply permit issued under

18 Title IV of the Environmental Protection Act. This paragraph is

19 exempt from the provisions of Section 3-55.

20 (28) Tangible personal property sold to a

21 public-facilities corporation, as described in Section

22 11-65-10 of the Illinois Municipal Code, for purposes of

23 constructing or furnishing a municipal convention hall, but

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

25 transferred to the municipality without any further

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

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

2 retirement or redemption of any bonds or other debt instruments

3 issued by the public-facilities corporation in connection with

4 the development of the municipal convention hall. This

5 exemption includes existing public-facilities corporations as

6 provided in Section 11-65-25 of the Illinois Municipal Code.

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

8 (29) Beginning January 1, 2010, materials, parts,

9 equipment, components, and furnishings incorporated into or

10 upon an aircraft as part of the modification, refurbishment,

11 completion, replacement, repair, or maintenance of the

12 aircraft. This exemption includes consumable supplies used in

13 the modification, refurbishment, completion, replacement,

14 repair, and maintenance of aircraft, but excludes any

15 materials, parts, equipment, components, and consumable

16 supplies used in the modification, replacement, repair, and

17 maintenance of aircraft engines or power plants, whether such

18 engines or power plants are installed or uninstalled upon any

19 such aircraft. "Consumable supplies" include, but are not

20 limited to, adhesive, tape, sandpaper, general purpose

21 lubricants, cleaning solution, latex gloves, and protective

22 films. This exemption applies only to those organizations that

23 (i) hold an Air Agency Certificate and are empowered to operate

24 an approved repair station by the Federal Aviation

25 Administration, (ii) have a Class IV Rating, and (iii) conduct

26 operations in accordance with Part 145 of the Federal Aviation

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1 Regulations. The exemption does not include aircraft operated

2 by a commercial air carrier providing scheduled passenger air

3 service pursuant to authority issued under Part 121 or Part 129

4 of the Federal Aviation Regulations.

5 (30) From August 15th through November 15th of each year

6 beginning in 2012, propane used for agricultural purposes. This

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

8 (Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;

9 96-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.

10 7-2-10; 97-38, eff. 6-28-11; 97-73, eff. 6-30-11; 97-227, eff.

11 1-1-12; 97-431, eff. 8-16-11; revised 9-12-11.)

12 Section 20. The Retailers' Occupation Tax Act is amended by

13 changing Section 2-5 as follows:

14 (35 ILCS 120/2-5)

15 Sec. 2-5. Exemptions. Gross receipts from proceeds from the

16 sale of the following tangible personal property are exempt

17 from the tax imposed by this Act:

18 (1) Farm chemicals.

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

20 including that manufactured on special order, certified by the

21 purchaser to be used primarily for production agriculture or

22 State or federal agricultural programs, including individual

23 replacement parts for the machinery and equipment, including

24 machinery and equipment purchased for lease, and including

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

2 Illinois Vehicle Code, farm machinery and agricultural

3 chemical and fertilizer spreaders, and nurse wagons required to

4 be registered under Section 3-809 of the Illinois Vehicle Code,

5 but excluding other motor vehicles required to be registered

6 under the Illinois Vehicle Code. Horticultural polyhouses or

7 hoop houses used for propagating, growing, or overwintering

8 plants shall be considered farm machinery and equipment under

9 this item (2). Agricultural chemical tender tanks and dry boxes

10 shall include units sold separately from a motor vehicle

11 required to be licensed and units sold mounted on a motor

12 vehicle required to be licensed, if the selling price of the

13 tender is separately stated.

14 Farm machinery and equipment shall include precision

15 farming equipment that is installed or purchased to be

16 installed on farm machinery and equipment including, but not

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

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

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

20 software, global positioning and mapping systems, and other

21 such equipment.

22 Farm machinery and equipment also includes computers,

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

24 computer-assisted operation of production agriculture

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

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

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1 crop data for the purpose of formulating animal diets and

2 agricultural chemicals. This item (2) ~~(7)~~is exempt from the

3 provisions of Section 2-70.

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

5 equipment, sold as a unit or kit, assembled or installed by the

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

7 production of ethyl alcohol that will be used for consumption

8 as motor fuel or as a component of motor fuel for the personal

9 use of the user, and not subject to sale or resale.

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

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

12 equipment, including repair and replacement parts, both new and

13 used, and including that manufactured on special order or

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

15 primarily for graphic arts production. Equipment includes

16 chemicals or chemicals acting as catalysts but only if the

17 chemicals or chemicals acting as catalysts effect a direct and

18 immediate change upon a graphic arts product.

19 (5) A motor vehicle of the first division, a motor vehicle

20 of the second division that is a self contained motor vehicle

21 designed or permanently converted to provide living quarters

22 for recreational, camping, or travel use, with direct walk

23 through access to the living quarters from the driver's seat,

24 or a motor vehicle of the second division that is of the van

25 configuration designed for the transportation of not less than

26 7 nor more than 16 passengers, as defined in Section 1-146 of

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1 the Illinois Vehicle Code, that is used for automobile renting,

2 as defined in the Automobile Renting Occupation and Use Tax

3 Act. This paragraph is exempt from the provisions of Section

4 2-70.

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

6 organization affiliated with an elementary or secondary school

7 located in Illinois.

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

9 selling price of a passenger car the sale of which is subject

10 to the Replacement Vehicle Tax.

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

12 association for use in conducting, operating, or promoting the

13 county fair.

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

15 cultural organization that establishes, by proof required by

16 the Department by rule, that it has received an exemption under

17 Section 501(c)(3) of the Internal Revenue Code and that is

18 organized and operated primarily for the presentation or

19 support of arts or cultural programming, activities, or

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

21 music and dramatic arts organizations such as symphony

22 orchestras and theatrical groups, arts and cultural service

23 organizations, local arts councils, visual arts organizations,

24 and media arts organizations. On and after the effective date

25 of this amendatory Act of the 92nd General Assembly, however,

26 an entity otherwise eligible for this exemption shall not make

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1 tax-free purchases unless it has an active identification

2 number issued by the Department.

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

4 association, foundation, institution, or organization, other

5 than a limited liability company, that is organized and

6 operated as a not-for-profit service enterprise for the benefit

7 of persons 65 years of age or older if the personal property

8 was not purchased by the enterprise for the purpose of resale

9 by the enterprise.

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

11 corporation, society, association, foundation, or institution

12 organized and operated exclusively for charitable, religious,

13 or educational purposes, or to a not-for-profit corporation,

14 society, association, foundation, institution, or organization

15 that has no compensated officers or employees and that is

16 organized and operated primarily for the recreation of persons

17 55 years of age or older. A limited liability company may

18 qualify for the exemption under this paragraph only if the

19 limited liability company is organized and operated

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

21 1987, however, no entity otherwise eligible for this exemption

22 shall make tax-free purchases unless it has an active

23 identification number issued by the Department.

24 (12) Tangible personal property sold to interstate

25 carriers for hire for use as rolling stock moving in interstate

26 commerce or to lessors under leases of one year or longer

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1 executed or in effect at the time of purchase by interstate

2 carriers for hire for use as rolling stock moving in interstate

3 commerce and equipment operated by a telecommunications

4 provider, licensed as a common carrier by the Federal

5 Communications Commission, which is permanently installed in

6 or affixed to aircraft moving in interstate commerce.

7 (12-5) On and after July 1, 2003 and through June 30, 2004,

8 motor vehicles of the second division with a gross vehicle

9 weight in excess of 8,000 pounds that are subject to the

10 commercial distribution fee imposed under Section 3-815.1 of

11 the Illinois Vehicle Code. Beginning on July 1, 2004 and

12 through June 30, 2005, the use in this State of motor vehicles

13 of the second division: (i) with a gross vehicle weight rating

14 in excess of 8,000 pounds; (ii) that are subject to the

15 commercial distribution fee imposed under Section 3-815.1 of

16 the Illinois Vehicle Code; and (iii) that are primarily used

17 for commercial purposes. Through June 30, 2005, this exemption

18 applies to repair and replacement parts added after the initial

19 purchase of such a motor vehicle if that motor vehicle is used

20 in a manner that would qualify for the rolling stock exemption

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

22 paragraph, "used for commercial purposes" means the

23 transportation of persons or property in furtherance of any

24 commercial or industrial enterprise whether for-hire or not.

25 (13) Proceeds from sales to owners, lessors, or shippers of

26 tangible personal property that is utilized by interstate

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1 carriers for hire for use as rolling stock moving in interstate

2 commerce and equipment operated by a telecommunications

3 provider, licensed as a common carrier by the Federal

4 Communications Commission, which is permanently installed in

5 or affixed to aircraft moving in interstate commerce.

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

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

8 process of manufacturing or assembling tangible personal

9 property for wholesale or retail sale or lease, whether the

10 sale or lease is made directly by the manufacturer or by some

11 other person, whether the materials used in the process are

12 owned by the manufacturer or some other person, or whether the

13 sale or lease is made apart from or as an incident to the

14 seller's engaging in the service occupation of producing

15 machines, tools, dies, jigs, patterns, gauges, or other similar

16 items of no commercial value on special order for a particular

17 purchaser.

18 (15) Proceeds of mandatory service charges separately

19 stated on customers' bills for purchase and consumption of food

20 and beverages, to the extent that the proceeds of the service

21 charge are in fact turned over as tips or as a substitute for

22 tips to the employees who participate directly in preparing,

23 serving, hosting or cleaning up the food or beverage function

24 with respect to which the service charge is imposed.

25 (16) Petroleum products sold to a purchaser if the seller

26 is prohibited by federal law from charging tax to the

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1 purchaser.

2 (17) Tangible personal property sold to a common carrier by

3 rail or motor that receives the physical possession of the

4 property in Illinois and that transports the property, or

5 shares with another common carrier in the transportation of the

6 property, out of Illinois on a standard uniform bill of lading

7 showing the seller of the property as the shipper or consignor

8 of the property to a destination outside Illinois, for use

9 outside Illinois.

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

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

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

13 country, and bullion.

14 (19) Until July 1 2003, oil field exploration, drilling,

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

16 rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and

17 tubular goods, including casing and drill strings, (iii) pumps

18 and pump-jack units, (iv) storage tanks and flow lines, (v) any

19 individual replacement part for oil field exploration,

20 drilling, and production equipment, and (vi) machinery and

21 equipment purchased for lease; but excluding motor vehicles

22 required to be registered under the Illinois Vehicle Code.

23 (20) Photoprocessing machinery and equipment, including

24 repair and replacement parts, both new and used, including that

25 manufactured on special order, certified by the purchaser to be

26 used primarily for photoprocessing, and including

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1 photoprocessing machinery and equipment purchased for lease.

2 (21) Until July 1, 2003, coal exploration, mining,

3 offhighway hauling, processing, maintenance, and reclamation

4 equipment, including replacement parts and equipment, and

5 including equipment purchased for lease, but excluding motor

6 vehicles required to be registered under the Illinois Vehicle

7 Code.

8 (22) Fuel and petroleum products sold to or used by an air

9 carrier, certified by the carrier to be used for consumption,

10 shipment, or storage in the conduct of its business as an air

11 common carrier, for a flight destined for or returning from a

12 location or locations outside the United States without regard

13 to previous or subsequent domestic stopovers.

14 (23) A transaction in which the purchase order is received

15 by a florist who is located outside Illinois, but who has a

16 florist located in Illinois deliver the property to the

17 purchaser or the purchaser's donee in Illinois.

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

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

20 transportation of property or the conveyance of persons for

21 hire on rivers bordering on this State if the fuel is delivered

22 by the seller to the purchaser's barge, ship, or vessel while

23 it is afloat upon that bordering river.

24 (25) Except as provided in item (25-5) of this Section, a

25 motor vehicle sold in this State to a nonresident even though

26 the motor vehicle is delivered to the nonresident in this

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1 State, if the motor vehicle is not to be titled in this State,

2 and if a drive-away permit is issued to the motor vehicle as

3 provided in Section 3-603 of the Illinois Vehicle Code or if

4 the nonresident purchaser has vehicle registration plates to

5 transfer to the motor vehicle upon returning to his or her home

6 state. The issuance of the drive-away permit or having the

7 out-of-state registration plates to be transferred is prima

8 facie evidence that the motor vehicle will not be titled in

9 this State.

10 (25-5) The exemption under item (25) does not apply if the

11 state in which the motor vehicle will be titled does not allow

12 a reciprocal exemption for a motor vehicle sold and delivered

13 in that state to an Illinois resident but titled in Illinois.

14 The tax collected under this Act on the sale of a motor vehicle

15 in this State to a resident of another state that does not

16 allow a reciprocal exemption shall be imposed at a rate equal

17 to the state's rate of tax on taxable property in the state in

18 which the purchaser is a resident, except that the tax shall

19 not exceed the tax that would otherwise be imposed under this

20 Act. At the time of the sale, the purchaser shall execute a

21 statement, signed under penalty of perjury, of his or her

22 intent to title the vehicle in the state in which the purchaser

23 is a resident within 30 days after the sale and of the fact of

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

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

26 his or her state of residence and shall submit the statement to

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1 the appropriate tax collection agency in his or her state of

2 residence. In addition, the retailer must retain a signed copy

3 of the statement in his or her records. Nothing in this item

4 shall be construed to require the removal of the vehicle from

5 this state following the filing of an intent to title the

6 vehicle in the purchaser's state of residence if the purchaser

7 titles the vehicle in his or her state of residence within 30

8 days after the date of sale. The tax collected under this Act

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

10 distributed as if the tax were collected at the 6.25% general

11 rate imposed under this Act.

12 (25-7) Beginning on July 1, 2007, no tax is imposed under

13 this Act on the sale of an aircraft, as defined in Section 3 of

14 the Illinois Aeronautics Act, if all of the following

15 conditions are met:

16 (1) the aircraft leaves this State within 15 days after

17 the later of either the issuance of the final billing for

18 the sale of the aircraft, or the authorized approval for

19 return to service, completion of the maintenance record

20 entry, and completion of the test flight and ground test

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

22 (2) the aircraft is not based or registered in this

23 State after the sale of the aircraft; and

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

25 and provides to the Department a signed and dated

26 certification from the purchaser, on a form prescribed by

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1 the Department, certifying that the requirements of this

2 item (25-7) are met. The certificate must also include the

3 name and address of the purchaser, the address of the

4 location where the aircraft is to be titled or registered,

5 the address of the primary physical location of the

6 aircraft, and other information that the Department may

7 reasonably require.

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

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

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

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

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

13 "Registered in this State" means an aircraft registered

14 with the Department of Transportation, Aeronautics Division,

15 or titled or registered with the Federal Aviation

16 Administration to an address located in this State.

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

18 Section 2-70.

19 (26) Semen used for artificial insemination of livestock

20 for direct agricultural production.

21 (27) Horses, or interests in horses, registered with and

22 meeting the requirements of any of the Arabian Horse Club

23 Registry of America, Appaloosa Horse Club, American Quarter

24 Horse Association, United States Trotting Association, or

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

26 racing for prizes. This item (27) is exempt from the provisions

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1 of Section 2-70, and the exemption provided for under this item

2 (27) applies for all periods beginning May 30, 1995, but no

3 claim for credit or refund is allowed on or after January 1,

4 2008 (the effective date of Public Act 95-88) for such taxes

5 paid during the period beginning May 30, 2000 and ending on

6 January 1, 2008 (the effective date of Public Act 95-88).

7 (28) Computers and communications equipment utilized for

8 any hospital purpose and equipment used in the diagnosis,

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

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

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

12 hospital that has been issued an active tax exemption

13 identification number by the Department under Section 1g of

14 this Act.

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

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

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

18 has been issued an active tax exemption identification number

19 by the Department under Section 1g of this Act.

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

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

22 before December 31, 2004, personal property that is donated for

23 disaster relief to be used in a State or federally declared

24 disaster area in Illinois or bordering Illinois by a

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

26 corporation, society, association, foundation, or institution

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1 that has been issued a sales tax exemption identification

2 number by the Department that assists victims of the disaster

3 who reside within the declared disaster area.

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

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

6 before December 31, 2004, personal property that is used in the

7 performance of infrastructure repairs in this State, including

8 but not limited to municipal roads and streets, access roads,

9 bridges, sidewalks, waste disposal systems, water and sewer

10 line extensions, water distribution and purification

11 facilities, storm water drainage and retention facilities, and

12 sewage treatment facilities, resulting from a State or

13 federally declared disaster in Illinois or bordering Illinois

14 when such repairs are initiated on facilities located in the

15 declared disaster area within 6 months after the disaster.

16 (32) Beginning July 1, 1999, game or game birds sold at a

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

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

19 provisions of Section 2-70.

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

21 1-146 of the Illinois Vehicle Code, that is donated to a

22 corporation, limited liability company, society, association,

23 foundation, or institution that is determined by the Department

24 to be organized and operated exclusively for educational

25 purposes. For purposes of this exemption, "a corporation,

26 limited liability company, society, association, foundation,

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1 or institution organized and operated exclusively for

2 educational purposes" means all tax-supported public schools,

3 private schools that offer systematic instruction in useful

4 branches of learning by methods common to public schools and

5 that compare favorably in their scope and intensity with the

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

7 vocational or technical schools or institutes organized and

8 operated exclusively to provide a course of study of not less

9 than 6 weeks duration and designed to prepare individuals to

10 follow a trade or to pursue a manual, technical, mechanical,

11 industrial, business, or commercial occupation.

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

13 including food, purchased through fundraising events for the

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

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

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

17 district that consists primarily of volunteers and includes

18 parents and teachers of the school children. This paragraph

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

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

21 entity purchases the personal property sold at the events from

22 another individual or entity that sold the property for the

23 purpose of resale by the fundraising entity and that profits

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

25 exempt from the provisions of Section 2-70.

26 (35) Beginning January 1, 2000 and through December 31,

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1 2001, new or used automatic vending machines that prepare and

2 serve hot food and beverages, including coffee, soup, and other

3 items, and replacement parts for these machines. Beginning

4 January 1, 2002 and through June 30, 2003, machines and parts

5 for machines used in commercial, coin-operated amusement and

6 vending business if a use or occupation tax is paid on the

7 gross receipts derived from the use of the commercial,

8 coin-operated amusement and vending machines. This paragraph

9 is exempt from the provisions of Section 2-70.

10 (35-5) Beginning August 23, 2001 and through June 30, 2011,

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

12 premises where it is sold (other than alcoholic beverages, soft

13 drinks, and food that has been prepared for immediate

14 consumption) and prescription and nonprescription medicines,

15 drugs, medical appliances, and insulin, urine testing

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

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

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

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

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

21 the ID/DD Community Care Act or the Specialized Mental Health

22 Rehabilitation Act.

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

24 communications equipment utilized for any hospital purpose and

25 equipment used in the diagnosis, analysis, or treatment of

26 hospital patients sold to a lessor who leases the equipment,

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1 under a lease of one year or longer executed or in effect at

2 the time of the purchase, to a hospital that has been issued an

3 active tax exemption identification number by the Department

4 under Section 1g of this Act. This paragraph is exempt from the

5 provisions of Section 2-70.

6 (37) Beginning August 2, 2001, personal property sold to a

7 lessor who leases the property, under a lease of one year or

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

9 governmental body that has been issued an active tax exemption

10 identification number by the Department under Section 1g of

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

12 Section 2-70.

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

14 2016, tangible personal property purchased from an Illinois

15 retailer by a taxpayer engaged in centralized purchasing

16 activities in Illinois who will, upon receipt of the property

17 in Illinois, temporarily store the property in Illinois (i) for

18 the purpose of subsequently transporting it outside this State

19 for use or consumption thereafter solely outside this State or

20 (ii) for the purpose of being processed, fabricated, or

21 manufactured into, attached to, or incorporated into other

22 tangible personal property to be transported outside this State

23 and thereafter used or consumed solely outside this State. The

24 Director of Revenue shall, pursuant to rules adopted in

25 accordance with the Illinois Administrative Procedure Act,

26 issue a permit to any taxpayer in good standing with the

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1 Department who is eligible for the exemption under this

2 paragraph (38). The permit issued under this paragraph (38)

3 shall authorize the holder, to the extent and in the manner

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

5 tangible personal property from a retailer exempt from the

6 taxes imposed by this Act. Taxpayers shall maintain all

7 necessary books and records to substantiate the use and

8 consumption of all such tangible personal property outside of

9 the State of Illinois.

10 (39) Beginning January 1, 2008, tangible personal property

11 used in the construction or maintenance of a community water

12 supply, as defined under Section 3.145 of the Environmental

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

14 corporation that holds a valid water supply permit issued under

15 Title IV of the Environmental Protection Act. This paragraph is

16 exempt from the provisions of Section 2-70.

17 (40) Beginning January 1, 2010, materials, parts,

18 equipment, components, and furnishings incorporated into or

19 upon an aircraft as part of the modification, refurbishment,

20 completion, replacement, repair, or maintenance of the

21 aircraft. This exemption includes consumable supplies used in

22 the modification, refurbishment, completion, replacement,

23 repair, and maintenance of aircraft, but excludes any

24 materials, parts, equipment, components, and consumable

25 supplies used in the modification, replacement, repair, and

26 maintenance of aircraft engines or power plants, whether such

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1 engines or power plants are installed or uninstalled upon any

2 such aircraft. "Consumable supplies" include, but are not

3 limited to, adhesive, tape, sandpaper, general purpose

4 lubricants, cleaning solution, latex gloves, and protective

5 films. This exemption applies only to those organizations that

6 (i) hold an Air Agency Certificate and are empowered to operate

7 an approved repair station by the Federal Aviation

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

9 operations in accordance with Part 145 of the Federal Aviation

10 Regulations. The exemption does not include aircraft operated

11 by a commercial air carrier providing scheduled passenger air

12 service pursuant to authority issued under Part 121 or Part 129

13 of the Federal Aviation Regulations.

14 (41) Tangible personal property sold to a

15 public-facilities corporation, as described in Section

16 11-65-10 of the Illinois Municipal Code, for purposes of

17 constructing or furnishing a municipal convention hall, but

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

19 transferred to the municipality without any further

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

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

22 retirement or redemption of any bonds or other debt instruments

23 issued by the public-facilities corporation in connection with

24 the development of the municipal convention hall. This

25 exemption includes existing public-facilities corporations as

26 provided in Section 11-65-25 of the Illinois Municipal Code.

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

2 (42) From August 15th through November 15th of each year

3 beginning in 2012, propane used for agricultural purposes. This

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

5 (Source: P.A. 96-116, eff. 7-31-09; 96-339, eff. 7-1-10;

6 96-532, eff. 8-14-09; 96-759, eff. 1-1-10; 96-1000, eff.

7 7-2-10; 97-38, eff. 6-28-11; 97-73, eff. 6-30-11; 97-227, eff.

8 1-1-12; 97-431, eff. 8-16-11; revised 9-12-11.)

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

10 becoming law.