Illinois House Bill HB2518 Engrossed / Bill

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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
20  or cultural organization that establishes, by proof required
21  by the Department by rule, that it has received an exemption
22  under Section 501(c)(3) of the Internal Revenue Code and that
23  is 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 July 1, 2001 (the
7  effective date of Public Act 92-35), however, an entity
8  otherwise eligible for this exemption shall not make tax-free
9  purchases unless it has an active identification number issued
10  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
24  exemption 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
5  and 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
11  a graphic arts product. Beginning on July 1, 2017, graphic
12  arts machinery and equipment is included in the manufacturing
13  and assembling machinery and equipment exemption under
14  paragraph (18).
15  (7) Farm chemicals.
16  (8) Legal tender, currency, medallions, or gold or silver
17  coinage issued by the State of Illinois, the government of the
18  United States of America, or the government of any foreign
19  country, and bullion.
20  (9) Personal property purchased from a teacher-sponsored
21  student organization affiliated with an elementary or
22  secondary school located in Illinois.
23  (10) A motor vehicle that is used for automobile renting,
24  as defined in the Automobile Renting Occupation and Use Tax
25  Act.
26  (11) Farm machinery and equipment, both new and used,

 

 

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1  including that manufactured on special order, certified by the
2  purchaser to be used primarily for production agriculture or
3  State or federal agricultural programs, including individual
4  replacement parts for the machinery and equipment, including
5  machinery and equipment purchased for lease, and including
6  implements of husbandry defined in Section 1-130 of the
7  Illinois Vehicle Code, farm machinery and agricultural
8  chemical and fertilizer spreaders, and nurse wagons required
9  to be registered under Section 3-809 of the Illinois Vehicle
10  Code, but excluding other motor vehicles required to be
11  registered under the Illinois Vehicle Code. Horticultural
12  polyhouses or hoop houses used for propagating, growing, or
13  overwintering plants shall be considered farm machinery and
14  equipment under this item (11). Agricultural chemical tender
15  tanks and dry boxes shall include units sold separately from a
16  motor vehicle required to be licensed and units sold mounted
17  on a motor vehicle required to be licensed if the selling price
18  of the tender is separately stated.
19  Farm machinery and equipment shall include precision
20  farming equipment that is installed or purchased to be
21  installed on farm machinery and equipment including, but not
22  limited to, tractors, harvesters, sprayers, planters, seeders,
23  or spreaders. Precision farming equipment includes, but is not
24  limited to, soil testing sensors, computers, monitors,
25  software, global positioning and mapping systems, and other
26  such equipment.

 

 

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1  Farm machinery and equipment also includes computers,
2  sensors, software, and related equipment used primarily in the
3  computer-assisted operation of production agriculture
4  facilities, equipment, and activities such as, but not limited
5  to, the collection, monitoring, and correlation of animal and
6  crop data for the purpose of formulating animal diets and
7  agricultural chemicals. This item (11) is exempt from the
8  provisions of Section 3-90.
9  (12) Until June 30, 2013, fuel and petroleum products sold
10  to or used by an air common carrier, certified by the carrier
11  to be used for consumption, shipment, or storage in the
12  conduct of its business as an air common carrier, for a flight
13  destined for or returning from a location or locations outside
14  the United States without regard to previous or subsequent
15  domestic stopovers.
16  Beginning July 1, 2013, fuel and petroleum products sold
17  to or used by an air carrier, certified by the carrier to be
18  used for consumption, shipment, or storage in the conduct of
19  its business as an air common carrier, for a flight that (i) is
20  engaged in foreign trade or is engaged in trade between the
21  United States and any of its possessions and (ii) transports
22  at least one individual or package for hire from the city of
23  origination to the city of final destination on the same
24  aircraft, without regard to a change in the flight number of
25  that aircraft.
26  (13) 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 purchased at retail from a retailer, to the
3  extent that the proceeds of the service charge are in fact
4  turned over as tips or as a substitute for tips to the
5  employees who participate directly in preparing, serving,
6  hosting or cleaning up the food or beverage function with
7  respect to which the service charge is imposed.
8  (14) Until July 1, 2003, oil field exploration, drilling,
9  and production equipment, including (i) rigs and parts of
10  rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
11  pipe and tubular goods, including casing and drill strings,
12  (iii) pumps and pump-jack units, (iv) storage tanks and flow
13  lines, (v) any individual replacement part for oil field
14  exploration, drilling, and production equipment, and (vi)
15  machinery and equipment purchased for lease; but excluding
16  motor vehicles required to be registered under the Illinois
17  Vehicle Code.
18  (15) Photoprocessing machinery and equipment, including
19  repair and replacement parts, both new and used, including
20  that manufactured on special order, certified by the purchaser
21  to be used primarily for photoprocessing, and including
22  photoprocessing machinery and equipment purchased for lease.
23  (16) Until July 1, 2028, coal and aggregate exploration,
24  mining, off-highway hauling, processing, maintenance, and
25  reclamation equipment, including replacement parts and
26  equipment, and including equipment purchased for lease, but

 

 

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1  excluding motor vehicles required to be registered under the
2  Illinois Vehicle Code. The changes made to this Section by
3  Public Act 97-767 apply on and after July 1, 2003, but no claim
4  for credit or refund is allowed on or after August 16, 2013
5  (the effective date of Public Act 98-456) for such taxes paid
6  during the period beginning July 1, 2003 and ending on August
7  16, 2013 (the effective date of Public Act 98-456).
8  (17) Until July 1, 2003, distillation machinery and
9  equipment, sold as a unit or kit, assembled or installed by the
10  retailer, certified by the user to be used only for the
11  production of ethyl alcohol that will be used for consumption
12  as motor fuel or as a component of motor fuel for the personal
13  use of the user, and not subject to sale or resale.
14  (18) Manufacturing and assembling machinery and equipment
15  used primarily in the process of manufacturing or assembling
16  tangible personal property for wholesale or retail sale or
17  lease, whether that sale or lease is made directly by the
18  manufacturer or by some other person, whether the materials
19  used in the process are owned by the manufacturer or some other
20  person, or whether that sale or lease is made apart from or as
21  an incident to the seller's engaging in the service occupation
22  of producing machines, tools, dies, jigs, patterns, gauges, or
23  other similar items of no commercial value on special order
24  for a particular purchaser. The exemption provided by this
25  paragraph (18) includes production related tangible personal
26  property, as defined in Section 3-50, purchased on or after

 

 

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1  July 1, 2019. The exemption provided by this paragraph (18)
2  does not include machinery and equipment used in (i) the
3  generation of electricity for wholesale or retail sale; (ii)
4  the generation or treatment of natural or artificial gas for
5  wholesale or retail sale that is delivered to customers
6  through pipes, pipelines, or mains; or (iii) the treatment of
7  water for wholesale or retail sale that is delivered to
8  customers through pipes, pipelines, or mains. The provisions
9  of Public Act 98-583 are declaratory of existing law as to the
10  meaning and scope of this exemption. Beginning on July 1,
11  2017, the exemption provided by this paragraph (18) includes,
12  but is not limited to, graphic arts machinery and equipment,
13  as defined in paragraph (6) of this Section.
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

 

 

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1  provisions of Section 3-90, and the exemption provided for
2  under this item (21) applies for all periods beginning May 30,
3  1995, but no claim for credit or refund is allowed on or after
4  January 1, 2008 for such taxes paid during the period
5  beginning May 30, 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
14  the Retailers' Occupation Tax Act. If the equipment is leased
15  in a manner that does not qualify for this exemption or is used
16  in any other non-exempt manner, the lessor shall be liable for
17  the tax imposed under this Act or the Service Use Tax Act, as
18  the case may be, based on the fair market value of the property
19  at the time the non-qualifying use occurs. No lessor shall
20  collect or attempt to collect an amount (however designated)
21  that purports to reimburse that lessor for the tax imposed by
22  this Act or the Service Use Tax Act, as the case may be, if the
23  tax has not been paid by the lessor. If a lessor improperly
24  collects any such amount from the lessee, the lessee shall
25  have a legal right to claim a refund of that amount from the
26  lessor. If, however, that amount is not refunded to the lessee

 

 

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1  for any reason, the lessor is liable to pay that amount to the
2  Department.
3  (23) Personal property purchased by a lessor who leases
4  the property, under a lease of one year or longer executed or
5  in effect at the time the lessor would otherwise be subject to
6  the tax imposed by this Act, to a governmental body that has
7  been issued an active sales tax exemption identification
8  number by the Department under Section 1g of the Retailers'
9  Occupation Tax Act. If the property is leased in a manner that
10  does not qualify for this exemption or used in any other
11  non-exempt manner, the lessor shall be liable for the tax
12  imposed under this Act or the Service Use Tax Act, as the case
13  may be, based on the fair market value of the property at the
14  time the non-qualifying use occurs. No lessor shall collect or
15  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
20  have a legal right to claim a refund of that amount from the
21  lessor. If, however, that amount is not refunded to the lessee
22  for any reason, the lessor is liable to pay that amount to the
23  Department.
24  (24) Beginning with taxable years ending on or after
25  December 31, 1995 and ending with taxable years ending on or
26  before December 31, 2004, personal property that is donated

 

 

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1  for disaster relief to be used in a State or federally declared
2  disaster area in Illinois or bordering Illinois by a
3  manufacturer or retailer that is registered in this State to a
4  corporation, society, association, foundation, or institution
5  that has been issued a sales tax exemption identification
6  number by the Department that assists victims of the disaster
7  who reside within the declared disaster area.
8  (25) 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 used in
11  the performance of infrastructure repairs in this State,
12  including but not limited to municipal roads and streets,
13  access roads, bridges, sidewalks, waste disposal systems,
14  water and sewer line extensions, water distribution and
15  purification facilities, storm water drainage and retention
16  facilities, and sewage treatment facilities, resulting from a
17  State or federally declared disaster in Illinois or bordering
18  Illinois when such repairs are initiated on facilities located
19  in the declared disaster area within 6 months after the
20  disaster.
21  (26) Beginning July 1, 1999, game or game birds purchased
22  at a "game breeding and hunting preserve area" as that term is
23  used in the Wildlife Code. This paragraph is exempt from the
24  provisions of Section 3-90.
25  (27) A motor vehicle, as that term is defined in Section
26  1-146 of the Illinois Vehicle Code, that is donated to a

 

 

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1  corporation, limited liability company, society, association,
2  foundation, or institution that is determined by the
3  Department to be organized and operated exclusively for
4  educational purposes. For purposes of this exemption, "a
5  corporation, limited liability company, society, association,
6  foundation, or institution organized and operated exclusively
7  for educational purposes" means all tax-supported public
8  schools, private schools that offer systematic instruction in
9  useful branches of learning by methods common to public
10  schools and that compare favorably in their scope and
11  intensity with the course of study presented in tax-supported
12  schools, and vocational or technical schools or institutes
13  organized and operated exclusively to provide a course of
14  study of not less than 6 weeks duration and designed to prepare
15  individuals to follow a trade or to pursue a manual,
16  technical, mechanical, industrial, business, or commercial
17  occupation.
18  (28) Beginning January 1, 2000, personal property,
19  including food, purchased through fundraising events for the
20  benefit of a public or private elementary or secondary school,
21  a group of those schools, or one or more school districts if
22  the events are sponsored by an entity recognized by the school
23  district that consists primarily of volunteers and includes
24  parents and teachers of the school children. This paragraph
25  does not apply to fundraising events (i) for the benefit of
26  private home instruction or (ii) for which the fundraising

 

 

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1  entity purchases the personal property sold at the events from
2  another individual or entity that sold the property for the
3  purpose of resale by the fundraising entity and that profits
4  from the sale to the fundraising entity. This paragraph is
5  exempt from the provisions of Section 3-90.
6  (29) Beginning January 1, 2000 and through December 31,
7  2001, new or used automatic vending machines that prepare and
8  serve hot food and beverages, including coffee, soup, and
9  other items, and replacement parts for these machines.
10  Beginning January 1, 2002 and through June 30, 2003, machines
11  and parts for machines used in commercial, coin-operated
12  amusement and vending business if a use or occupation tax is
13  paid on the gross receipts derived from the use of the
14  commercial, coin-operated amusement and vending machines. This
15  paragraph is exempt from the provisions of Section 3-90.
16  (30) Beginning January 1, 2001 and through June 30, 2016,
17  food for human consumption that is to be consumed off the
18  premises where it is sold (other than alcoholic beverages,
19  soft drinks, and food that has been prepared for immediate
20  consumption) and prescription and nonprescription medicines,
21  drugs, medical appliances, and insulin, urine testing
22  materials, syringes, and needles used by diabetics, for human
23  use, when purchased for use by a person receiving medical
24  assistance under Article V of the Illinois Public Aid Code who
25  resides in a licensed long-term care facility, as defined in
26  the Nursing Home Care Act, or in a licensed facility as defined

 

 

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1  in the ID/DD Community Care Act, the MC/DD Act, or the
2  Specialized Mental Health Rehabilitation Act of 2013.
3  (31) Beginning on August 2, 2001 (the effective date of
4  Public Act 92-227), computers and communications equipment
5  utilized for any hospital purpose and equipment used in the
6  diagnosis, analysis, or treatment of hospital patients
7  purchased by a lessor who leases the equipment, under a lease
8  of one year or longer executed or in effect at the time the
9  lessor would otherwise be subject to the tax imposed by this
10  Act, to a hospital that has been issued an active tax exemption
11  identification number by the Department under Section 1g of
12  the Retailers' Occupation Tax Act. If the equipment is leased
13  in a manner that does not qualify for this exemption or is used
14  in any other nonexempt manner, the lessor shall be liable for
15  the tax imposed under this Act or the Service Use Tax Act, as
16  the case may be, based on the fair market value of the property
17  at the time the nonqualifying use occurs. No lessor shall
18  collect or attempt to collect an amount (however designated)
19  that purports to reimburse that lessor for the tax imposed by
20  this Act or the Service Use Tax Act, as the case may be, if the
21  tax has not been paid by the lessor. If a lessor improperly
22  collects any such amount from the lessee, the lessee shall
23  have a legal right to claim a refund of that amount from the
24  lessor. If, however, that amount is not refunded to the lessee
25  for any reason, the lessor is liable to pay that amount to the
26  Department. This paragraph is exempt from the provisions of

 

 

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1  Section 3-90.
2  (32) Beginning on August 2, 2001 (the effective date of
3  Public Act 92-227), personal property purchased by a lessor
4  who leases the property, under a lease of one year or longer
5  executed or in effect at the time the lessor would otherwise be
6  subject to the tax imposed by this Act, to a governmental body
7  that has been issued an active sales tax exemption
8  identification number by the Department under Section 1g of
9  the Retailers' Occupation Tax Act. If the property is leased
10  in a manner that does not qualify for this exemption or 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
20  have a legal right to claim a refund of that amount from the
21  lessor. If, however, that amount is not refunded to the lessee
22  for any 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  (33) On and after July 1, 2003 and through June 30, 2004,
26  the use in this State of motor vehicles of the second division

 

 

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1  with a gross vehicle weight in excess of 8,000 pounds and that
2  are subject to the commercial distribution fee imposed under
3  Section 3-815.1 of the Illinois Vehicle Code. Beginning on
4  July 1, 2004 and through June 30, 2005, the use in this State
5  of motor vehicles of the second division: (i) with a gross
6  vehicle weight rating in excess of 8,000 pounds; (ii) that are
7  subject to the commercial distribution fee imposed under
8  Section 3-815.1 of the Illinois Vehicle Code; and (iii) that
9  are primarily used for commercial purposes. Through June 30,
10  2005, this exemption applies to repair and replacement parts
11  added after the initial purchase of such a motor vehicle if
12  that motor vehicle is used in a manner that would qualify for
13  the rolling stock exemption otherwise provided for in this
14  Act. For purposes of this paragraph, the term "used for
15  commercial purposes" means the transportation of persons or
16  property in furtherance of any commercial or industrial
17  enterprise, whether for-hire or not.
18  (34) Beginning January 1, 2008, tangible personal property
19  used in the construction or maintenance of a community water
20  supply, as defined under Section 3.145 of the Environmental
21  Protection Act, that is operated by a not-for-profit
22  corporation that holds a valid water supply permit issued
23  under Title IV of the Environmental Protection Act. This
24  paragraph is exempt from the provisions of Section 3-90.
25  (35) Beginning January 1, 2010 and continuing through
26  December 31, 2024, materials, parts, equipment, components,

 

 

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1  and furnishings incorporated into or upon an aircraft as part
2  of the modification, refurbishment, completion, replacement,
3  repair, or maintenance of the aircraft. This exemption
4  includes consumable supplies used in the modification,
5  refurbishment, completion, replacement, repair, and
6  maintenance of aircraft. However, until January 1, 2024, this
7  exemption , but excludes any materials, parts, equipment,
8  components, and consumable supplies used in the modification,
9  replacement, repair, and maintenance of aircraft engines or
10  power plants, whether such engines or power plants are
11  installed or uninstalled upon any such aircraft. "Consumable
12  supplies" include, but are not limited to, adhesive, tape,
13  sandpaper, general purpose lubricants, cleaning solution,
14  latex gloves, and protective films.
15  Beginning January 1, 2010 and continuing through December
16  31, 2023, this This exemption applies only to the use of
17  qualifying tangible personal property by persons who modify,
18  refurbish, complete, repair, replace, or maintain aircraft and
19  who (i) hold an Air Agency Certificate and are empowered to
20  operate an approved repair station by the Federal Aviation
21  Administration, (ii) have a Class IV Rating, and (iii) conduct
22  operations in accordance with Part 145 of the Federal Aviation
23  Regulations. From January 1, 2024 through December 31, 2024,
24  this exemption applies only to the use of qualifying tangible
25  personal property by: (A) persons who modify, refurbish,
26  complete, repair, replace, or maintain aircraft and who (i)

 

 

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1  hold an Air Agency Certificate and are empowered to operate an
2  approved repair station by the Federal Aviation
3  Administration, (ii) have a Class IV Rating, and (iii) conduct
4  operations in accordance with Part 145 of the Federal Aviation
5  Regulations; and (B) persons who engage in the modification,
6  replacement, repair, and maintenance of aircraft engines or
7  power plants without regard to whether or not those persons
8  meet the qualifications of item (A).
9  The exemption does not include aircraft operated by a
10  commercial air carrier providing scheduled passenger air
11  service pursuant to authority issued under Part 121 or Part
12  129 of the Federal Aviation Regulations. The changes made to
13  this paragraph (35) by Public Act 98-534 are declarative of
14  existing law. It is the intent of the General Assembly that the
15  exemption under this paragraph (35) applies continuously from
16  January 1, 2010 through December 31, 2024; however, no claim
17  for credit or refund is allowed for taxes paid as a result of
18  the disallowance of this exemption on or after January 1, 2015
19  and prior to February 5, 2020 (the effective date of Public Act
20  101-629) this amendatory Act of the 101st General Assembly.
21  (36) Tangible personal property purchased by a
22  public-facilities corporation, as described in Section
23  11-65-10 of the Illinois Municipal Code, for purposes of
24  constructing or furnishing a municipal convention hall, but
25  only if the legal title to the municipal convention hall is
26  transferred to the municipality without any further

 

 

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1  consideration by or on behalf of the municipality at the time
2  of the completion of the municipal convention hall or upon the
3  retirement or redemption of any bonds or other debt
4  instruments issued by the public-facilities corporation in
5  connection with the development of the municipal convention
6  hall. This exemption includes existing public-facilities
7  corporations as provided in Section 11-65-25 of the Illinois
8  Municipal Code. This paragraph is exempt from the provisions
9  of Section 3-90.
10  (37) Beginning January 1, 2017 and through December 31,
11  2026, menstrual pads, tampons, and menstrual cups.
12  (38) Merchandise that is subject to the Rental Purchase
13  Agreement Occupation and Use Tax. The purchaser must certify
14  that the item is purchased to be rented subject to a rental
15  purchase agreement, as defined in the Rental Purchase
16  Agreement Act, and provide proof of registration under the
17  Rental Purchase Agreement Occupation and Use Tax Act. This
18  paragraph is exempt from the provisions of Section 3-90.
19  (39) Tangible personal property purchased by a purchaser
20  who is exempt from the tax imposed by this Act by operation of
21  federal law. This paragraph is exempt from the provisions of
22  Section 3-90.
23  (40) Qualified tangible personal property used in the
24  construction or operation of a data center that has been
25  granted a certificate of exemption by the Department of
26  Commerce and Economic Opportunity, whether that tangible

 

 

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1  personal property is purchased by the owner, operator, or
2  tenant of the data center or by a contractor or subcontractor
3  of the owner, operator, or tenant. Data centers that would
4  have qualified for a certificate of exemption prior to January
5  1, 2020 had Public Act 101-31 been in effect may apply for and
6  obtain an exemption for subsequent purchases of computer
7  equipment or enabling software purchased or leased to upgrade,
8  supplement, or replace computer equipment or enabling software
9  purchased or leased in the original investment that would have
10  qualified.
11  The Department of Commerce and Economic Opportunity shall
12  grant a certificate of exemption under this item (40) to
13  qualified data centers as defined by Section 605-1025 of the
14  Department of Commerce and Economic Opportunity Law of the
15  Civil Administrative Code of Illinois.
16  For the purposes of this item (40):
17  "Data center" means a building or a series of
18  buildings rehabilitated or constructed to house working
19  servers in one physical location or multiple sites within
20  the State of Illinois.
21  "Qualified tangible personal property" means:
22  electrical systems and equipment; climate control and
23  chilling equipment and systems; mechanical systems and
24  equipment; monitoring and secure systems; emergency
25  generators; hardware; computers; servers; data storage
26  devices; network connectivity equipment; racks; cabinets;

 

 

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1  telecommunications cabling infrastructure; raised floor
2  systems; peripheral components or systems; software;
3  mechanical, electrical, or plumbing systems; battery
4  systems; cooling systems and towers; temperature control
5  systems; other cabling; and other data center
6  infrastructure equipment and systems necessary to operate
7  qualified tangible personal property, including fixtures;
8  and component parts of any of the foregoing, including
9  installation, maintenance, repair, refurbishment, and
10  replacement of qualified tangible personal property to
11  generate, transform, transmit, distribute, or manage
12  electricity necessary to operate qualified tangible
13  personal property; and all other tangible personal
14  property that is essential to the operations of a computer
15  data center. The term "qualified tangible personal
16  property" also includes building materials physically
17  incorporated in to the qualifying data center. To document
18  the exemption allowed under this Section, the retailer
19  must obtain from the purchaser a copy of the certificate
20  of eligibility issued by the Department of Commerce and
21  Economic Opportunity.
22  This item (40) is exempt from the provisions of Section
23  3-90.
24  (41) Beginning July 1, 2022, breast pumps, breast pump
25  collection and storage supplies, and breast pump kits. This
26  item (41) is exempt from the provisions of Section 3-90. As

 

 

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1  used in this item (41):
2  "Breast pump" means an electrically controlled or
3  manually controlled pump device designed or marketed to be
4  used to express milk from a human breast during lactation,
5  including the pump device and any battery, AC adapter, or
6  other power supply unit that is used to power the pump
7  device and is packaged and sold with the pump device at the
8  time of sale.
9  "Breast pump collection and storage supplies" means
10  items of tangible personal property designed or marketed
11  to be used in conjunction with a breast pump to collect
12  milk expressed from a human breast and to store collected
13  milk until it is ready for consumption.
14  "Breast pump collection and storage supplies"
15  includes, but is not limited to: breast shields and breast
16  shield connectors; breast pump tubes and tubing adapters;
17  breast pump valves and membranes; backflow protectors and
18  backflow protector adaptors; bottles and bottle caps
19  specific to the operation of the breast pump; and breast
20  milk storage bags.
21  "Breast pump collection and storage supplies" does not
22  include: (1) bottles and bottle caps not specific to the
23  operation of the breast pump; (2) breast pump travel bags
24  and other similar carrying accessories, including ice
25  packs, labels, and other similar products; (3) breast pump
26  cleaning supplies; (4) nursing bras, bra pads, breast

 

 

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1  shells, and other similar products; and (5) creams,
2  ointments, and other similar products that relieve
3  breastfeeding-related symptoms or conditions of the
4  breasts or nipples, unless sold as part of a breast pump
5  kit that is pre-packaged by the breast pump manufacturer
6  or distributor.
7  "Breast pump kit" means a kit that: (1) contains no
8  more than a breast pump, breast pump collection and
9  storage supplies, a rechargeable battery for operating the
10  breast pump, a breastmilk cooler, bottle stands, ice
11  packs, and a breast pump carrying case; and (2) is
12  pre-packaged as a breast pump kit by the breast pump
13  manufacturer or distributor.
14  (42) (41) Tangible personal property sold by or on behalf
15  of the State Treasurer pursuant to the Revised Uniform
16  Unclaimed Property Act. This item (42) (41) is exempt from the
17  provisions of Section 3-90.
18  (Source: P.A. 101-9, eff. 6-5-19; 101-31, eff. 6-28-19;
19  101-81, eff. 7-12-19; 101-629, eff. 2-5-20; 102-16, eff.
20  6-17-21; 102-700, Article 70, Section 70-5, eff. 4-19-22;
21  102-700, Article 75, Section 75-5, eff. 4-19-22; 102-1026,
22  eff. 5-27-22; revised 8-1-22.)
23  Section 10. The Service Use Tax Act is amended by changing
24  Section 3-5 as follows:

 

 

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1  (35 ILCS 110/3-5)
2  Sec. 3-5. Exemptions. Use of the following tangible
3  personal property is exempt from the tax imposed by this Act:
4  (1) Personal property purchased from a corporation,
5  society, association, foundation, institution, or
6  organization, other than a limited liability company, that is
7  organized and operated as a not-for-profit service enterprise
8  for the benefit of persons 65 years of age or older if the
9  personal property was not purchased by the enterprise for the
10  purpose of resale by the enterprise.
11  (2) Personal property purchased by a non-profit Illinois
12  county fair association for use in conducting, operating, or
13  promoting the county fair.
14  (3) Personal property purchased by a not-for-profit arts
15  or cultural organization that establishes, by proof required
16  by the Department by rule, that it has received an exemption
17  under Section 501(c)(3) of the Internal Revenue Code and that
18  is 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 July 1, 2001 (the
25  effective date of Public Act 92-35), however, an entity
26  otherwise eligible for this exemption shall not make tax-free

 

 

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1  purchases unless it has an active identification number issued
2  by the Department.
3  (4) Legal tender, currency, medallions, or gold or silver
4  coinage issued by the State of Illinois, the government of the
5  United States of America, or the government of any foreign
6  country, and bullion.
7  (5) Until July 1, 2003 and beginning again on September 1,
8  2004 through August 30, 2014, graphic arts machinery and
9  equipment, including repair and replacement parts, both new
10  and used, and including that manufactured on special order or
11  purchased for lease, certified by the purchaser to be used
12  primarily for graphic arts production. Equipment includes
13  chemicals or chemicals acting as catalysts but only if the
14  chemicals or chemicals acting as catalysts effect a direct and
15  immediate change upon a graphic arts product. Beginning on
16  July 1, 2017, graphic arts machinery and equipment is included
17  in the manufacturing and assembling machinery and equipment
18  exemption under Section 2 of this Act.
19  (6) Personal property purchased from a teacher-sponsored
20  student organization affiliated with an elementary or
21  secondary school located in Illinois.
22  (7) Farm machinery and equipment, both new and used,
23  including that manufactured on special order, certified by the
24  purchaser to be used primarily for production agriculture or
25  State or federal agricultural programs, including individual
26  replacement parts for the machinery and equipment, including

 

 

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1  machinery and equipment purchased for lease, and including
2  implements of husbandry defined in Section 1-130 of the
3  Illinois Vehicle Code, farm machinery and agricultural
4  chemical and fertilizer spreaders, and nurse wagons required
5  to be registered under Section 3-809 of the Illinois Vehicle
6  Code, but excluding other motor vehicles required to be
7  registered under the Illinois Vehicle Code. Horticultural
8  polyhouses or hoop houses used for propagating, growing, or
9  overwintering plants shall be considered farm machinery and
10  equipment under this item (7). Agricultural chemical tender
11  tanks and dry boxes shall include units sold separately from a
12  motor vehicle required to be licensed and units sold mounted
13  on a motor vehicle required to be licensed if the selling price
14  of the tender is separately stated.
15  Farm machinery and equipment shall include precision
16  farming equipment that is installed or purchased to be
17  installed on farm machinery and equipment including, but not
18  limited to, tractors, harvesters, sprayers, planters, seeders,
19  or spreaders. Precision farming equipment includes, but is not
20  limited to, soil testing sensors, computers, monitors,
21  software, global positioning and mapping systems, and other
22  such equipment.
23  Farm machinery and equipment also includes computers,
24  sensors, software, and related equipment used primarily in the
25  computer-assisted operation of production agriculture
26  facilities, equipment, and activities such as, but not limited

 

 

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1  to, the collection, monitoring, and correlation of animal and
2  crop data for the purpose of formulating animal diets and
3  agricultural chemicals. This item (7) is exempt from the
4  provisions of Section 3-75.
5  (8) Until June 30, 2013, fuel and petroleum products sold
6  to or used by an air common carrier, certified by the carrier
7  to be used for consumption, shipment, or storage in the
8  conduct of its business as an air common carrier, for a flight
9  destined for or returning from a location or locations outside
10  the United States without regard to previous or subsequent
11  domestic stopovers.
12  Beginning July 1, 2013, fuel and petroleum products sold
13  to or used by an air carrier, certified by the carrier to be
14  used for consumption, shipment, or storage in the conduct of
15  its business as an air common carrier, for a flight that (i) is
16  engaged in foreign trade or is engaged in trade between the
17  United States and any of its possessions and (ii) transports
18  at least one individual or package for hire from the city of
19  origination to the city of final destination on the same
20  aircraft, without regard to a change in the flight number of
21  that aircraft.
22  (9) Proceeds of mandatory service charges separately
23  stated on customers' bills for the purchase and consumption of
24  food and beverages acquired as an incident to the purchase of a
25  service from a serviceman, to the extent that the proceeds of
26  the service charge are in fact turned over as tips or as a

 

 

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1  substitute for tips to the employees who participate directly
2  in preparing, serving, hosting or cleaning up the food or
3  beverage function with respect to which the service charge is
4  imposed.
5  (10) Until July 1, 2003, oil field exploration, drilling,
6  and production equipment, including (i) rigs and parts of
7  rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
8  pipe and tubular goods, including casing and drill strings,
9  (iii) pumps and pump-jack units, (iv) storage tanks and flow
10  lines, (v) any individual replacement part for oil field
11  exploration, drilling, and production equipment, and (vi)
12  machinery and equipment purchased for lease; but excluding
13  motor vehicles required to be registered under the Illinois
14  Vehicle Code.
15  (11) Proceeds from the sale of photoprocessing machinery
16  and equipment, including repair and replacement parts, both
17  new and used, including that manufactured on special order,
18  certified by the purchaser to be used primarily for
19  photoprocessing, and including photoprocessing machinery and
20  equipment purchased for lease.
21  (12) Until July 1, 2028, coal and aggregate exploration,
22  mining, off-highway hauling, processing, maintenance, and
23  reclamation equipment, including replacement parts and
24  equipment, and including equipment purchased for lease, but
25  excluding motor vehicles required to be registered under the
26  Illinois Vehicle Code. The changes made to this Section by

 

 

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1  Public Act 97-767 apply on and after July 1, 2003, but no claim
2  for credit or refund is allowed on or after August 16, 2013
3  (the effective date of Public Act 98-456) for such taxes paid
4  during the period beginning July 1, 2003 and ending on August
5  16, 2013 (the effective date of Public Act 98-456).
6  (13) Semen used for artificial insemination of livestock
7  for direct agricultural production.
8  (14) 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 (14) is exempt from the
14  provisions of Section 3-75, and the exemption provided for
15  under this item (14) applies for all periods beginning May 30,
16  1995, but no claim for credit or refund is allowed on or after
17  January 1, 2008 (the effective date of Public Act 95-88) for
18  such taxes paid during the period beginning May 30, 2000 and
19  ending on January 1, 2008 (the effective date of Public Act
20  95-88).
21  (15) Computers and communications equipment utilized for
22  any hospital purpose and equipment used in the diagnosis,
23  analysis, or treatment of hospital patients purchased by a
24  lessor who leases the equipment, under a lease of one year or
25  longer executed or in effect at the time the lessor would
26  otherwise be subject to the tax imposed by this Act, to a

 

 

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1  hospital that has been issued an active tax exemption
2  identification number by the Department under Section 1g of
3  the Retailers' Occupation Tax Act. If the equipment is leased
4  in a manner that does not qualify for this exemption or is used
5  in any other non-exempt manner, the lessor shall be liable for
6  the tax imposed under this Act or the Use Tax Act, as the case
7  may be, based on the fair market value of the property at the
8  time the non-qualifying use occurs. No lessor shall collect or
9  attempt to collect an amount (however designated) that
10  purports to reimburse that lessor for the tax imposed by this
11  Act or the Use Tax Act, as the case may be, if the tax has not
12  been paid by the lessor. If a lessor improperly collects any
13  such amount from the lessee, the lessee shall have a legal
14  right to claim a refund of that amount from the lessor. If,
15  however, that amount is not refunded to the lessee for any
16  reason, the lessor is liable to pay that amount to the
17  Department.
18  (16) Personal property purchased by a lessor who leases
19  the property, under a lease of one year or longer executed or
20  in effect at the time the lessor would otherwise be subject to
21  the tax imposed by this Act, to a governmental body that has
22  been issued an active tax exemption identification number by
23  the Department under Section 1g of the Retailers' Occupation
24  Tax Act. If the property is leased in a manner that does not
25  qualify for this exemption or is used in any other non-exempt
26  manner, the lessor shall be liable for the tax imposed under

 

 

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1  this Act or the Use Tax Act, as the case may be, based on the
2  fair market value of the property at the time the
3  non-qualifying use occurs. No lessor shall collect or attempt
4  to collect an amount (however designated) that purports to
5  reimburse that lessor for the tax imposed by this Act or the
6  Use Tax Act, as the case may be, if the tax has not been paid
7  by the lessor. If a lessor improperly collects any such amount
8  from the lessee, the lessee shall have a legal right to claim a
9  refund of that amount from the lessor. If, however, that
10  amount is not refunded to the lessee for any reason, the lessor
11  is liable to pay that amount to the Department.
12  (17) Beginning with taxable years ending on or after
13  December 31, 1995 and ending with taxable years ending on or
14  before December 31, 2004, personal property that is donated
15  for disaster relief to be used in a State or federally declared
16  disaster area in Illinois or bordering Illinois by a
17  manufacturer or retailer that is registered in this State to a
18  corporation, society, association, foundation, or institution
19  that has been issued a sales tax exemption identification
20  number by the Department that assists victims of the disaster
21  who reside within the declared disaster area.
22  (18) Beginning with taxable years ending on or after
23  December 31, 1995 and ending with taxable years ending on or
24  before December 31, 2004, personal property that is used in
25  the performance of infrastructure repairs in this State,
26  including but not limited to municipal roads and streets,

 

 

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1  access roads, bridges, sidewalks, waste disposal systems,
2  water and sewer line extensions, water distribution and
3  purification facilities, storm water drainage and retention
4  facilities, and sewage treatment facilities, resulting from a
5  State or federally declared disaster in Illinois or bordering
6  Illinois when such repairs are initiated on facilities located
7  in the declared disaster area within 6 months after the
8  disaster.
9  (19) Beginning July 1, 1999, game or game birds purchased
10  at a "game breeding and hunting preserve area" as that term is
11  used in the Wildlife Code. This paragraph is exempt from the
12  provisions of Section 3-75.
13  (20) A motor vehicle, as that term is defined in Section
14  1-146 of the Illinois Vehicle Code, that is donated to a
15  corporation, limited liability company, society, association,
16  foundation, or institution that is determined by the
17  Department to be organized and operated exclusively for
18  educational purposes. For purposes of this exemption, "a
19  corporation, limited liability company, society, association,
20  foundation, or institution organized and operated exclusively
21  for educational purposes" means all tax-supported public
22  schools, private schools that offer systematic instruction in
23  useful branches of learning by methods common to public
24  schools and that compare favorably in their scope and
25  intensity with the course of study presented in tax-supported
26  schools, and vocational or technical schools or institutes

 

 

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1  organized and operated exclusively to provide a course of
2  study of not less than 6 weeks duration and designed to prepare
3  individuals to follow a trade or to pursue a manual,
4  technical, mechanical, industrial, business, or commercial
5  occupation.
6  (21) Beginning January 1, 2000, personal property,
7  including food, purchased through fundraising events for the
8  benefit of a public or private elementary or secondary school,
9  a group of those schools, or one or more school districts if
10  the events are sponsored by an entity recognized by the school
11  district that consists primarily of volunteers and includes
12  parents and teachers of the school children. This paragraph
13  does not apply to fundraising events (i) for the benefit of
14  private home instruction or (ii) for which the fundraising
15  entity purchases the personal property sold at the events from
16  another individual or entity that sold the property for the
17  purpose of resale by the fundraising entity and that profits
18  from the sale to the fundraising entity. This paragraph is
19  exempt from the provisions of Section 3-75.
20  (22) Beginning January 1, 2000 and through December 31,
21  2001, new or used automatic vending machines that prepare and
22  serve hot food and beverages, including coffee, soup, and
23  other items, and replacement parts for these machines.
24  Beginning January 1, 2002 and through June 30, 2003, machines
25  and parts for machines used in commercial, coin-operated
26  amusement and vending business if a use or occupation tax is

 

 

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1  paid on the gross receipts derived from the use of the
2  commercial, coin-operated amusement and vending machines. This
3  paragraph is exempt from the provisions of Section 3-75.
4  (23) Beginning August 23, 2001 and through June 30, 2016,
5  food for human consumption that is to be consumed off the
6  premises where it is sold (other than alcoholic beverages,
7  soft drinks, and food that has been prepared for immediate
8  consumption) and prescription and nonprescription medicines,
9  drugs, medical appliances, and insulin, urine testing
10  materials, syringes, and needles used by diabetics, for human
11  use, when purchased for use by a person receiving medical
12  assistance under Article V of the Illinois Public Aid Code who
13  resides in a licensed long-term care facility, as defined in
14  the Nursing Home Care Act, or in a licensed facility as defined
15  in the ID/DD Community Care Act, the MC/DD Act, or the
16  Specialized Mental Health Rehabilitation Act of 2013.
17  (24) Beginning on August 2, 2001 (the effective date of
18  Public Act 92-227), computers and communications equipment
19  utilized for any hospital purpose and equipment used in the
20  diagnosis, analysis, or treatment of hospital patients
21  purchased by a lessor who leases the equipment, under a lease
22  of one year or longer executed or in effect at the time the
23  lessor would otherwise be subject to the tax imposed by this
24  Act, to a hospital that has been issued an active tax exemption
25  identification number by the Department under Section 1g of
26  the Retailers' Occupation Tax Act. If the equipment is leased

 

 

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1  in a manner that does not qualify for this exemption or is used
2  in any other nonexempt manner, the lessor shall be liable for
3  the tax imposed under this Act or the Use Tax Act, as the case
4  may be, based on the fair market value of the property at the
5  time the nonqualifying use occurs. No lessor shall collect or
6  attempt to collect an amount (however designated) that
7  purports to reimburse that lessor for the tax imposed by this
8  Act or the Use Tax Act, as the case may be, if the tax has not
9  been paid by the lessor. If a lessor improperly collects any
10  such amount from the lessee, the lessee shall have a legal
11  right to claim a refund of that amount from the lessor. If,
12  however, that amount is not refunded to the lessee for any
13  reason, the lessor is liable to pay that amount to the
14  Department. This paragraph is exempt from the provisions of
15  Section 3-75.
16  (25) Beginning on August 2, 2001 (the effective date of
17  Public Act 92-227), personal property purchased by a lessor
18  who leases the property, under a lease of one year or longer
19  executed or in effect at the time the lessor would otherwise be
20  subject to the tax imposed by this Act, to a governmental body
21  that has been issued an active tax exemption identification
22  number by the Department under Section 1g of the Retailers'
23  Occupation Tax Act. If the property is leased in a manner that
24  does not qualify for this exemption or is used in any other
25  nonexempt manner, the lessor shall be liable for the tax
26  imposed under this Act or the Use Tax Act, as the case may be,

 

 

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1  based on the fair market value of the property at the time the
2  nonqualifying use occurs. No lessor shall collect or attempt
3  to collect an amount (however designated) that purports to
4  reimburse that lessor for the tax imposed by this Act or the
5  Use Tax Act, as the case may be, if the tax has not been paid
6  by the lessor. If a lessor improperly collects any such amount
7  from the lessee, the lessee shall have a legal right to claim a
8  refund of that amount from the lessor. If, however, that
9  amount is not refunded to the lessee for any reason, the lessor
10  is liable to pay that amount to the Department. This paragraph
11  is exempt from the provisions of Section 3-75.
12  (26) Beginning January 1, 2008, tangible personal property
13  used in the construction or maintenance of a community water
14  supply, as defined under Section 3.145 of the Environmental
15  Protection Act, that is operated by a not-for-profit
16  corporation that holds a valid water supply permit issued
17  under Title IV of the Environmental Protection Act. This
18  paragraph is exempt from the provisions of Section 3-75.
19  (27) Beginning January 1, 2010 and continuing through
20  December 31, 2024, materials, parts, equipment, components,
21  and furnishings incorporated into or upon an aircraft as part
22  of the modification, refurbishment, completion, replacement,
23  repair, or maintenance of the aircraft. This exemption
24  includes consumable supplies used in the modification,
25  refurbishment, completion, replacement, repair, and
26  maintenance of aircraft. However, until January 1, 2024, this

 

 

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1  exemption , but excludes any materials, parts, equipment,
2  components, and consumable supplies used in the modification,
3  replacement, repair, and maintenance of aircraft engines or
4  power plants, whether such engines or power plants are
5  installed or uninstalled upon any such aircraft. "Consumable
6  supplies" include, but are not limited to, adhesive, tape,
7  sandpaper, general purpose lubricants, cleaning solution,
8  latex gloves, and protective films.
9  Beginning January 1, 2010 and continuing through December
10  31, 2023, this This exemption applies only to the use of
11  qualifying tangible personal property transferred incident to
12  the modification, refurbishment, completion, replacement,
13  repair, or maintenance of aircraft by persons who (i) hold an
14  Air Agency Certificate and are empowered to operate an
15  approved repair station by the Federal Aviation
16  Administration, (ii) have a Class IV Rating, and (iii) conduct
17  operations in accordance with Part 145 of the Federal Aviation
18  Regulations. From January 1, 2024 through December 31, 2024,
19  this exemption applies only to the use of qualifying tangible
20  personal property by: (A) persons who modify, refurbish,
21  complete, repair, replace, or maintain aircraft and who (i)
22  hold an Air Agency Certificate and are empowered to operate an
23  approved repair station by the Federal Aviation
24  Administration, (ii) have a Class IV Rating, and (iii) conduct
25  operations in accordance with Part 145 of the Federal Aviation
26  Regulations; and (B) persons who engage in the modification,

 

 

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1  replacement, repair, and maintenance of aircraft engines or
2  power plants without regard to whether or not those persons
3  meet the qualifications of item (A).
4  The exemption does not include aircraft operated by a
5  commercial air carrier providing scheduled passenger air
6  service pursuant to authority issued under Part 121 or Part
7  129 of the Federal Aviation Regulations. The changes made to
8  this paragraph (27) by Public Act 98-534 are declarative of
9  existing law. It is the intent of the General Assembly that the
10  exemption under this paragraph (27) applies continuously from
11  January 1, 2010 through December 31, 2024; however, no claim
12  for credit or refund is allowed for taxes paid as a result of
13  the disallowance of this exemption on or after January 1, 2015
14  and prior to February 5, 2020 (the effective date of Public Act
15  101-629) this amendatory Act of the 101st General Assembly.
16  (28) Tangible personal property purchased by a
17  public-facilities corporation, as described in Section
18  11-65-10 of the Illinois Municipal Code, for purposes of
19  constructing or furnishing a municipal convention hall, but
20  only if the legal title to the municipal convention hall is
21  transferred to the municipality without any further
22  consideration by or on behalf of the municipality at the time
23  of the completion of the municipal convention hall or upon the
24  retirement or redemption of any bonds or other debt
25  instruments issued by the public-facilities corporation in
26  connection with the development of the municipal convention

 

 

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1  hall. This exemption includes existing public-facilities
2  corporations as provided in Section 11-65-25 of the Illinois
3  Municipal Code. This paragraph is exempt from the provisions
4  of Section 3-75.
5  (29) Beginning January 1, 2017 and through December 31,
6  2026, menstrual pads, tampons, and menstrual cups.
7  (30) Tangible personal property transferred to a purchaser
8  who is exempt from the tax imposed by this Act by operation of
9  federal law. This paragraph is exempt from the provisions of
10  Section 3-75.
11  (31) Qualified tangible personal property used in the
12  construction or operation of a data center that has been
13  granted a certificate of exemption by the Department of
14  Commerce and Economic Opportunity, whether that tangible
15  personal property is purchased by the owner, operator, or
16  tenant of the data center or by a contractor or subcontractor
17  of the owner, operator, or tenant. Data centers that would
18  have qualified for a certificate of exemption prior to January
19  1, 2020 had Public Act 101-31 this amendatory Act of the 101st
20  General Assembly been in effect, may apply for and obtain an
21  exemption for subsequent purchases of computer equipment or
22  enabling software purchased or leased to upgrade, supplement,
23  or replace computer equipment or enabling software purchased
24  or leased in the original investment that would have
25  qualified.
26  The Department of Commerce and Economic Opportunity shall

 

 

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1  grant a certificate of exemption under this item (31) to
2  qualified data centers as defined by Section 605-1025 of the
3  Department of Commerce and Economic Opportunity Law of the
4  Civil Administrative Code of Illinois.
5  For the purposes of this item (31):
6  "Data center" means a building or a series of
7  buildings rehabilitated or constructed to house working
8  servers in one physical location or multiple sites within
9  the State of Illinois.
10  "Qualified tangible personal property" means:
11  electrical systems and equipment; climate control and
12  chilling equipment and systems; mechanical systems and
13  equipment; monitoring and secure systems; emergency
14  generators; hardware; computers; servers; data storage
15  devices; network connectivity equipment; racks; cabinets;
16  telecommunications cabling infrastructure; raised floor
17  systems; peripheral components or systems; software;
18  mechanical, electrical, or plumbing systems; battery
19  systems; cooling systems and towers; temperature control
20  systems; other cabling; and other data center
21  infrastructure equipment and systems necessary to operate
22  qualified tangible personal property, including fixtures;
23  and component parts of any of the foregoing, including
24  installation, maintenance, repair, refurbishment, and
25  replacement of qualified tangible personal property to
26  generate, transform, transmit, distribute, or manage

 

 

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1  electricity necessary to operate qualified tangible
2  personal property; and all other tangible personal
3  property that is essential to the operations of a computer
4  data center. The term "qualified tangible personal
5  property" also includes building materials physically
6  incorporated in to the qualifying data center. To document
7  the exemption allowed under this Section, the retailer
8  must obtain from the purchaser a copy of the certificate
9  of eligibility issued by the Department of Commerce and
10  Economic Opportunity.
11  This item (31) is exempt from the provisions of Section
12  3-75.
13  (32) Beginning July 1, 2022, breast pumps, breast pump
14  collection and storage supplies, and breast pump kits. This
15  item (32) is exempt from the provisions of Section 3-75. As
16  used in this item (32):
17  "Breast pump" means an electrically controlled or
18  manually controlled pump device designed or marketed to be
19  used to express milk from a human breast during lactation,
20  including the pump device and any battery, AC adapter, or
21  other power supply unit that is used to power the pump
22  device and is packaged and sold with the pump device at the
23  time of sale.
24  "Breast pump collection and storage supplies" means
25  items of tangible personal property designed or marketed
26  to be used in conjunction with a breast pump to collect

 

 

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1  milk expressed from a human breast and to store collected
2  milk until it is ready for consumption.
3  "Breast pump collection and storage supplies"
4  includes, but is not limited to: breast shields and breast
5  shield connectors; breast pump tubes and tubing adapters;
6  breast pump valves and membranes; backflow protectors and
7  backflow protector adaptors; bottles and bottle caps
8  specific to the operation of the breast pump; and breast
9  milk storage bags.
10  "Breast pump collection and storage supplies" does not
11  include: (1) bottles and bottle caps not specific to the
12  operation of the breast pump; (2) breast pump travel bags
13  and other similar carrying accessories, including ice
14  packs, labels, and other similar products; (3) breast pump
15  cleaning supplies; (4) nursing bras, bra pads, breast
16  shells, and other similar products; and (5) creams,
17  ointments, and other similar products that relieve
18  breastfeeding-related symptoms or conditions of the
19  breasts or nipples, unless sold as part of a breast pump
20  kit that is pre-packaged by the breast pump manufacturer
21  or distributor.
22  "Breast pump kit" means a kit that: (1) contains no
23  more than a breast pump, breast pump collection and
24  storage supplies, a rechargeable battery for operating the
25  breast pump, a breastmilk cooler, bottle stands, ice
26  packs, and a breast pump carrying case; and (2) is

 

 

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1  pre-packaged as a breast pump kit by the breast pump
2  manufacturer or distributor.
3  (33) (32) Tangible personal property sold by or on behalf
4  of the State Treasurer pursuant to the Revised Uniform
5  Unclaimed Property Act. This item (33) (32) is exempt from the
6  provisions of Section 3-75.
7  (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
8  101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-700, Article
9  70, Section 70-10, eff. 4-19-22; 102-700, Article 75, Section
10  75-10, eff. 4-19-22; 102-1026, eff. 5-27-22; revised 8-3-22.)
11  Section 15. The Service Occupation Tax Act is amended by
12  changing Section 3-5 as follows:
13  (35 ILCS 115/3-5)
14  Sec. 3-5. Exemptions. The following tangible personal
15  property is exempt from the tax imposed by this Act:
16  (1) Personal property sold by a corporation, society,
17  association, foundation, institution, or organization, other
18  than a limited liability company, that is organized and
19  operated as a not-for-profit service enterprise for the
20  benefit of persons 65 years of age or older if the personal
21  property was not purchased by the enterprise for the purpose
22  of resale by the enterprise.
23  (2) Personal property purchased by a not-for-profit
24  Illinois county fair association for use in conducting,

 

 

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1  operating, or promoting the county fair.
2  (3) Personal property purchased by any not-for-profit arts
3  or cultural organization that establishes, by proof required
4  by the Department by rule, that it has received an exemption
5  under Section 501(c)(3) of the Internal Revenue Code and that
6  is organized and operated primarily for the presentation or
7  support of arts or cultural programming, activities, or
8  services. These organizations include, but are not limited to,
9  music and dramatic arts organizations such as symphony
10  orchestras and theatrical groups, arts and cultural service
11  organizations, local arts councils, visual arts organizations,
12  and media arts organizations. On and after July 1, 2001 (the
13  effective date of Public Act 92-35), however, an entity
14  otherwise eligible for this exemption shall not make tax-free
15  purchases unless it has an active identification number issued
16  by the Department.
17  (4) Legal tender, currency, medallions, or gold or silver
18  coinage issued by the State of Illinois, the government of the
19  United States of America, or the government of any foreign
20  country, and bullion.
21  (5) Until July 1, 2003 and beginning again on September 1,
22  2004 through August 30, 2014, graphic arts machinery and
23  equipment, including repair and replacement parts, both new
24  and used, and including that manufactured on special order or
25  purchased for lease, certified by the purchaser to be used
26  primarily for graphic arts production. Equipment includes

 

 

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1  chemicals or chemicals acting as catalysts but only if the
2  chemicals or chemicals acting as catalysts effect a direct and
3  immediate change upon a graphic arts product. Beginning on
4  July 1, 2017, graphic arts machinery and equipment is included
5  in the manufacturing and assembling machinery and equipment
6  exemption under Section 2 of this Act.
7  (6) Personal property sold by a teacher-sponsored student
8  organization affiliated with an elementary or secondary school
9  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
19  to be registered under Section 3-809 of the Illinois Vehicle
20  Code, but excluding other motor vehicles required to be
21  registered under the Illinois Vehicle Code. Horticultural
22  polyhouses or hoop houses used for propagating, growing, or
23  overwintering plants shall be considered farm machinery and
24  equipment under this item (7). Agricultural chemical tender
25  tanks and dry boxes shall include units sold separately from a
26  motor vehicle required to be licensed and units sold mounted

 

 

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1  on a motor vehicle required to be licensed if the selling price
2  of the 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 3-55.
19  (8) Until June 30, 2013, fuel and petroleum products sold
20  to or used by an air common carrier, certified by the carrier
21  to be used for consumption, shipment, or storage in the
22  conduct of its business as an air common carrier, for a flight
23  destined for or returning from a location or locations outside
24  the United States without regard to previous or subsequent
25  domestic stopovers.
26  Beginning July 1, 2013, fuel and petroleum products sold

 

 

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1  to or used by an air carrier, certified by the carrier to be
2  used for consumption, shipment, or storage in the conduct of
3  its business as an air common carrier, for a flight that (i) is
4  engaged in foreign trade or is engaged in trade between the
5  United States and any of its possessions and (ii) transports
6  at least one individual or package for hire from the city of
7  origination to the city of final destination on the same
8  aircraft, without regard to a change in the flight number of
9  that aircraft.
10  (9) Proceeds of mandatory service charges separately
11  stated on customers' bills for the purchase and consumption of
12  food and beverages, to the extent that the proceeds of the
13  service charge are in fact turned over as tips or as a
14  substitute for tips to the employees who participate directly
15  in preparing, serving, hosting or cleaning up the food or
16  beverage function with respect to which the service charge is
17  imposed.
18  (10) Until July 1, 2003, oil field exploration, drilling,
19  and production equipment, including (i) rigs and parts of
20  rigs, rotary rigs, cable tool rigs, and workover rigs, (ii)
21  pipe and tubular goods, including casing and drill strings,
22  (iii) pumps and pump-jack units, (iv) storage tanks and flow
23  lines, (v) any individual replacement part for oil field
24  exploration, drilling, and production equipment, and (vi)
25  machinery and equipment purchased for lease; but excluding
26  motor vehicles required to be registered under the Illinois

 

 

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1  Vehicle Code.
2  (11) Photoprocessing machinery and equipment, including
3  repair and replacement parts, both new and used, including
4  that manufactured on special order, certified by the purchaser
5  to be used primarily for photoprocessing, and including
6  photoprocessing machinery and equipment purchased for lease.
7  (12) Until July 1, 2028, coal and aggregate exploration,
8  mining, off-highway hauling, processing, maintenance, and
9  reclamation equipment, including replacement parts and
10  equipment, and including equipment purchased for lease, but
11  excluding motor vehicles required to be registered under the
12  Illinois Vehicle Code. The changes made to this Section by
13  Public Act 97-767 apply on and after July 1, 2003, but no claim
14  for credit or refund is allowed on or after August 16, 2013
15  (the effective date of Public Act 98-456) for such taxes paid
16  during the period beginning July 1, 2003 and ending on August
17  16, 2013 (the effective date of Public Act 98-456).
18  (13) Beginning January 1, 1992 and through June 30, 2016,
19  food for human consumption that is to be consumed off the
20  premises where it is sold (other than alcoholic beverages,
21  soft drinks and food that has been prepared for immediate
22  consumption) and prescription and non-prescription medicines,
23  drugs, medical appliances, and insulin, urine testing
24  materials, syringes, and needles used by diabetics, for human
25  use, when purchased for use by a person receiving medical
26  assistance under Article V of the Illinois Public Aid Code who

 

 

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1  resides in a licensed long-term care facility, as defined in
2  the Nursing Home Care Act, or in a licensed facility as defined
3  in the ID/DD Community Care Act, the MC/DD Act, or the
4  Specialized Mental Health Rehabilitation Act of 2013.
5  (14) Semen used for artificial insemination of livestock
6  for direct agricultural production.
7  (15) Horses, or interests in horses, registered with and
8  meeting the requirements of any of the Arabian Horse Club
9  Registry of America, Appaloosa Horse Club, American Quarter
10  Horse Association, United States Trotting Association, or
11  Jockey Club, as appropriate, used for purposes of breeding or
12  racing for prizes. This item (15) is exempt from the
13  provisions of Section 3-55, and the exemption provided for
14  under this item (15) applies for all periods beginning May 30,
15  1995, but no claim for credit or refund is allowed on or after
16  January 1, 2008 (the effective date of Public Act 95-88) for
17  such taxes paid during the period beginning May 30, 2000 and
18  ending on January 1, 2008 (the effective date of Public Act
19  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

 

 

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1  the 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'
7  Occupation 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
11  for 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
21  the performance of infrastructure repairs in this State,
22  including but not limited to municipal roads and streets,
23  access roads, bridges, sidewalks, waste disposal systems,
24  water and sewer line extensions, water distribution and
25  purification facilities, storm water drainage and retention
26  facilities, and sewage treatment facilities, resulting from a

 

 

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1  State or federally declared disaster in Illinois or bordering
2  Illinois when such repairs are initiated on facilities located
3  in the declared disaster area within 6 months after the
4  disaster.
5  (20) Beginning July 1, 1999, game or game birds sold at a
6  "game breeding and hunting preserve area" as that term is used
7  in the Wildlife Code. This paragraph is exempt from the
8  provisions of Section 3-55.
9  (21) 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
13  Department to be organized and operated exclusively for
14  educational purposes. For purposes of this exemption, "a
15  corporation, limited liability company, society, association,
16  foundation, or institution organized and operated exclusively
17  for educational purposes" means all tax-supported public
18  schools, private schools that offer systematic instruction in
19  useful branches of learning by methods common to public
20  schools and that compare favorably in their scope and
21  intensity with the course of study presented in tax-supported
22  schools, and vocational or technical schools or institutes
23  organized and operated exclusively to provide a course of
24  study of not less than 6 weeks duration and designed to prepare
25  individuals to follow a trade or to pursue a manual,
26  technical, mechanical, industrial, business, or commercial

 

 

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1  occupation.
2  (22) Beginning January 1, 2000, personal property,
3  including food, purchased through fundraising events for the
4  benefit of a public or private elementary or secondary school,
5  a group of those schools, or one or more school districts if
6  the events are sponsored by an entity recognized by the school
7  district that consists primarily of volunteers and includes
8  parents and teachers of the school children. This paragraph
9  does not apply to fundraising events (i) for the benefit of
10  private home instruction or (ii) for which the fundraising
11  entity purchases the personal property sold at the events from
12  another individual or entity that sold the property for the
13  purpose of resale by the fundraising entity and that profits
14  from the sale to the fundraising entity. This paragraph is
15  exempt from the provisions of Section 3-55.
16  (23) Beginning January 1, 2000 and through December 31,
17  2001, new or used automatic vending machines that prepare and
18  serve hot food and beverages, including coffee, soup, and
19  other items, and replacement parts for these machines.
20  Beginning January 1, 2002 and through June 30, 2003, machines
21  and parts for machines used in commercial, coin-operated
22  amusement and vending business if a use or occupation tax is
23  paid on the gross receipts derived from the use of the
24  commercial, coin-operated amusement and vending machines. This
25  paragraph is exempt from the provisions of Section 3-55.
26  (24) Beginning on August 2, 2001 (the effective date of

 

 

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1  Public Act 92-227), computers and communications equipment
2  utilized for any hospital purpose and equipment used in the
3  diagnosis, analysis, or treatment of hospital patients sold to
4  a lessor who leases the equipment, under a lease of one year or
5  longer executed or in effect at the time of the purchase, to a
6  hospital that has been issued an active tax exemption
7  identification number by the Department under Section 1g of
8  the Retailers' Occupation Tax Act. This paragraph is exempt
9  from the provisions of Section 3-55.
10  (25) Beginning on August 2, 2001 (the effective date of
11  Public Act 92-227), personal property sold to a lessor who
12  leases the property, under a lease of one year or longer
13  executed or in effect at the time of the purchase, to a
14  governmental body that has been issued an active tax exemption
15  identification number by the Department under Section 1g of
16  the Retailers' Occupation Tax Act. This paragraph is exempt
17  from the provisions of Section 3-55.
18  (26) Beginning on January 1, 2002 and through June 30,
19  2016, tangible personal property purchased from an Illinois
20  retailer by a taxpayer engaged in centralized purchasing
21  activities in Illinois who will, upon receipt of the property
22  in Illinois, temporarily store the property in Illinois (i)
23  for the purpose of subsequently transporting it outside this
24  State for use or consumption thereafter solely outside this
25  State or (ii) for the purpose of being processed, fabricated,
26  or manufactured into, attached to, or incorporated into other

 

 

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1  tangible personal property to be transported outside this
2  State and thereafter used or consumed solely outside this
3  State. The Director of Revenue shall, pursuant to rules
4  adopted in accordance with the Illinois Administrative
5  Procedure Act, issue a permit to any taxpayer in good standing
6  with the Department who is eligible for the exemption under
7  this paragraph (26). The permit issued under this paragraph
8  (26) shall authorize the holder, to the extent and in the
9  manner specified in the rules adopted under this Act, to
10  purchase tangible personal property from a retailer exempt
11  from the taxes imposed by this Act. Taxpayers shall maintain
12  all necessary books and records to substantiate the use and
13  consumption of all such tangible personal property outside of
14  the State of Illinois.
15  (27) 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
20  under Title IV of the Environmental Protection Act. This
21  paragraph is exempt from the provisions of Section 3-55.
22  (28) Tangible personal property sold to a
23  public-facilities corporation, as described in Section
24  11-65-10 of the Illinois Municipal Code, for purposes of
25  constructing or furnishing a municipal convention hall, but
26  only if the legal title to the municipal convention hall is

 

 

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1  transferred to the municipality without any further
2  consideration by or on behalf of the municipality at the time
3  of the completion of the municipal convention hall or upon the
4  retirement or redemption of any bonds or other debt
5  instruments issued by the public-facilities corporation in
6  connection with the development of the municipal convention
7  hall. This exemption includes existing public-facilities
8  corporations as provided in Section 11-65-25 of the Illinois
9  Municipal Code. This paragraph is exempt from the provisions
10  of Section 3-55.
11  (29) Beginning January 1, 2010 and continuing through
12  December 31, 2024, materials, parts, equipment, components,
13  and furnishings incorporated into or upon an aircraft as part
14  of the modification, refurbishment, completion, replacement,
15  repair, or maintenance of the aircraft. This exemption
16  includes consumable supplies used in the modification,
17  refurbishment, completion, replacement, repair, and
18  maintenance of aircraft. However, until January 1, 2024, this
19  exemption , but excludes any materials, parts, equipment,
20  components, and consumable supplies used in the modification,
21  replacement, repair, and maintenance of aircraft engines or
22  power plants, whether such engines or power plants are
23  installed or uninstalled upon any such aircraft. "Consumable
24  supplies" include, but are not limited to, adhesive, tape,
25  sandpaper, general purpose lubricants, cleaning solution,
26  latex gloves, and protective films.

 

 

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1  Beginning January 1, 2010 and continuing through December
2  31, 2023, this This exemption applies only to the transfer of
3  qualifying tangible personal property incident to the
4  modification, refurbishment, completion, replacement, repair,
5  or maintenance of an aircraft by persons who (i) hold an Air
6  Agency Certificate and are empowered to operate an approved
7  repair station by the Federal Aviation Administration, (ii)
8  have a Class IV Rating, and (iii) conduct operations in
9  accordance with Part 145 of the Federal Aviation Regulations.
10  The exemption does not include aircraft operated by a
11  commercial air carrier providing scheduled passenger air
12  service pursuant to authority issued under Part 121 or Part
13  129 of the Federal Aviation Regulations. From January 1, 2024
14  through December 31, 2024, this exemption applies only to the
15  use of qualifying tangible personal property by: (A) persons
16  who modify, refurbish, complete, repair, replace, or maintain
17  aircraft and who (i) hold an Air Agency Certificate and are
18  empowered to operate an approved repair station by the Federal
19  Aviation Administration, (ii) have a Class IV Rating, and
20  (iii) conduct operations in accordance with Part 145 of the
21  Federal Aviation Regulations; and (B) persons who engage in
22  the modification, replacement, repair, and maintenance of
23  aircraft engines or power plants without regard to whether or
24  not those persons meet the qualifications of item (A).
25  The changes made to this paragraph (29) by Public Act
26  98-534 are declarative of existing law. It is the intent of the

 

 

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1  General Assembly that the exemption under this paragraph (29)
2  applies continuously from January 1, 2010 through December 31,
3  2024; however, no claim for credit or refund is allowed for
4  taxes paid as a result of the disallowance of this exemption on
5  or after January 1, 2015 and prior to February 5, 2020 (the
6  effective date of Public Act 101-629) this amendatory Act of
7  the 101st General Assembly.
8  (30) Beginning January 1, 2017 and through December 31,
9  2026, menstrual pads, tampons, and menstrual cups.
10  (31) Tangible personal property transferred to a purchaser
11  who is exempt from tax by operation of federal law. This
12  paragraph is exempt from the provisions of Section 3-55.
13  (32) Qualified tangible personal property used in the
14  construction or operation of a data center that has been
15  granted a certificate of exemption by the Department of
16  Commerce and Economic Opportunity, whether that tangible
17  personal property is purchased by the owner, operator, or
18  tenant of the data center or by a contractor or subcontractor
19  of the owner, operator, or tenant. Data centers that would
20  have qualified for a certificate of exemption prior to January
21  1, 2020 had Public Act 101-31 this amendatory Act of the 101st
22  General Assembly been in effect, may apply for and obtain an
23  exemption for subsequent purchases of computer equipment or
24  enabling software purchased or leased to upgrade, supplement,
25  or replace computer equipment or enabling software purchased
26  or leased in the original investment that would have

 

 

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1  qualified.
2  The Department of Commerce and Economic Opportunity shall
3  grant a certificate of exemption under this item (32) to
4  qualified data centers as defined by Section 605-1025 of the
5  Department of Commerce and Economic Opportunity Law of the
6  Civil Administrative Code of Illinois.
7  For the purposes of this item (32):
8  "Data center" means a building or a series of
9  buildings rehabilitated or constructed to house working
10  servers in one physical location or multiple sites within
11  the State of Illinois.
12  "Qualified tangible personal property" means:
13  electrical systems and equipment; climate control and
14  chilling equipment and systems; mechanical systems and
15  equipment; monitoring and secure systems; emergency
16  generators; hardware; computers; servers; data storage
17  devices; network connectivity equipment; racks; cabinets;
18  telecommunications cabling infrastructure; raised floor
19  systems; peripheral components or systems; software;
20  mechanical, electrical, or plumbing systems; battery
21  systems; cooling systems and towers; temperature control
22  systems; other cabling; and other data center
23  infrastructure equipment and systems necessary to operate
24  qualified tangible personal property, including fixtures;
25  and component parts of any of the foregoing, including
26  installation, maintenance, repair, refurbishment, and

 

 

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1  replacement of qualified tangible personal property to
2  generate, transform, transmit, distribute, or manage
3  electricity necessary to operate qualified tangible
4  personal property; and all other tangible personal
5  property that is essential to the operations of a computer
6  data center. The term "qualified tangible personal
7  property" also includes building materials physically
8  incorporated in to the qualifying data center. To document
9  the exemption allowed under this Section, the retailer
10  must obtain from the purchaser a copy of the certificate
11  of eligibility issued by the Department of Commerce and
12  Economic Opportunity.
13  This item (32) is exempt from the provisions of Section
14  3-55.
15  (33) Beginning July 1, 2022, breast pumps, breast pump
16  collection and storage supplies, and breast pump kits. This
17  item (33) is exempt from the provisions of Section 3-55. As
18  used in this item (33):
19  "Breast pump" means an electrically controlled or
20  manually controlled pump device designed or marketed to be
21  used to express milk from a human breast during lactation,
22  including the pump device and any battery, AC adapter, or
23  other power supply unit that is used to power the pump
24  device and is packaged and sold with the pump device at the
25  time of sale.
26  "Breast pump collection and storage supplies" means

 

 

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1  items of tangible personal property designed or marketed
2  to be used in conjunction with a breast pump to collect
3  milk expressed from a human breast and to store collected
4  milk until it is ready for consumption.
5  "Breast pump collection and storage supplies"
6  includes, but is not limited to: breast shields and breast
7  shield connectors; breast pump tubes and tubing adapters;
8  breast pump valves and membranes; backflow protectors and
9  backflow protector adaptors; bottles and bottle caps
10  specific to the operation of the breast pump; and breast
11  milk storage bags.
12  "Breast pump collection and storage supplies" does not
13  include: (1) bottles and bottle caps not specific to the
14  operation of the breast pump; (2) breast pump travel bags
15  and other similar carrying accessories, including ice
16  packs, labels, and other similar products; (3) breast pump
17  cleaning supplies; (4) nursing bras, bra pads, breast
18  shells, and other similar products; and (5) creams,
19  ointments, and other similar products that relieve
20  breastfeeding-related symptoms or conditions of the
21  breasts or nipples, unless sold as part of a breast pump
22  kit that is pre-packaged by the breast pump manufacturer
23  or distributor.
24  "Breast pump kit" means a kit that: (1) contains no
25  more than a breast pump, breast pump collection and
26  storage supplies, a rechargeable battery for operating the

 

 

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1  breast pump, a breastmilk cooler, bottle stands, ice
2  packs, and a breast pump carrying case; and (2) is
3  pre-packaged as a breast pump kit by the breast pump
4  manufacturer or distributor.
5  (34) (33) Tangible personal property sold by or on behalf
6  of the State Treasurer pursuant to the Revised Uniform
7  Unclaimed Property Act. This item (34) (33) is exempt from the
8  provisions of Section 3-55.
9  (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
10  101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-700, Article
11  70, Section 70-15, eff. 4-19-22; 102-700, Article 75, Section
12  75-15, eff. 4-19-22; 102-1026, eff. 5-27-22; revised 8-9-22.)
13  Section 20. The Retailers' Occupation Tax Act is amended
14  by changing Section 2-5 as follows:
15  (35 ILCS 120/2-5)
16  Sec. 2-5. Exemptions. Gross receipts from proceeds from
17  the sale of the following tangible personal property are
18  exempt from the tax imposed by this Act:
19  (1) Farm chemicals.
20  (2) Farm machinery and equipment, both new and used,
21  including that manufactured on special order, certified by
22  the purchaser to be used primarily for production
23  agriculture or State or federal agricultural programs,
24  including individual replacement parts for the machinery

 

 

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1  and equipment, including machinery and equipment purchased
2  for lease, and including implements of husbandry defined
3  in Section 1-130 of the Illinois Vehicle Code, farm
4  machinery and agricultural chemical and fertilizer
5  spreaders, and nurse wagons required to be registered
6  under Section 3-809 of the Illinois Vehicle Code, but
7  excluding other motor vehicles required to be registered
8  under the Illinois Vehicle Code. Horticultural polyhouses
9  or hoop houses used for propagating, growing, or
10  overwintering plants shall be considered farm machinery
11  and equipment under this item (2). Agricultural chemical
12  tender tanks and dry boxes shall include units sold
13  separately from a motor vehicle required to be licensed
14  and units sold mounted on a motor vehicle required to be
15  licensed, if the selling price of the tender is separately
16  stated.
17  Farm machinery and equipment shall include precision
18  farming equipment that is installed or purchased to be
19  installed on farm machinery and equipment including, but
20  not limited to, tractors, harvesters, sprayers, planters,
21  seeders, or spreaders. Precision farming equipment
22  includes, but is not limited to, soil testing sensors,
23  computers, monitors, software, global positioning and
24  mapping systems, and other such equipment.
25  Farm machinery and equipment also includes computers,
26  sensors, software, and related equipment used primarily in

 

 

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1  the computer-assisted operation of production agriculture
2  facilities, equipment, and activities such as, but not
3  limited to, the collection, monitoring, and correlation of
4  animal and crop data for the purpose of formulating animal
5  diets and agricultural chemicals. This item (2) is exempt
6  from the provisions of Section 2-70.
7  (3) Until July 1, 2003, distillation machinery and
8  equipment, sold as a unit or kit, assembled or installed
9  by the retailer, certified by the user to be used only for
10  the production of ethyl alcohol that will be used for
11  consumption as motor fuel or as a component of motor fuel
12  for the personal use of the user, and not subject to sale
13  or resale.
14  (4) Until July 1, 2003 and beginning again September
15  1, 2004 through August 30, 2014, graphic arts machinery
16  and equipment, including repair and replacement parts,
17  both new and used, and including that manufactured on
18  special order or purchased for lease, certified by the
19  purchaser to be used primarily for graphic arts
20  production. Equipment includes chemicals or chemicals
21  acting as catalysts but only if the chemicals or chemicals
22  acting as catalysts effect a direct and immediate change
23  upon a graphic arts product. Beginning on July 1, 2017,
24  graphic arts machinery and equipment is included in the
25  manufacturing and assembling machinery and equipment
26  exemption under paragraph (14).

 

 

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1  (5) A motor vehicle that is used for automobile
2  renting, as defined in the Automobile Renting Occupation
3  and Use Tax Act. This paragraph is exempt from the
4  provisions of Section 2-70.
5  (6) Personal property sold by a teacher-sponsored
6  student organization affiliated with an elementary or
7  secondary school located in Illinois.
8  (7) Until July 1, 2003, proceeds of that portion of
9  the selling price of a passenger car the sale of which is
10  subject to the Replacement Vehicle Tax.
11  (8) Personal property sold to an Illinois county fair
12  association for use in conducting, operating, or promoting
13  the county fair.
14  (9) Personal property sold to a not-for-profit arts or
15  cultural organization that establishes, by proof required
16  by the Department by rule, that it has received an
17  exemption under Section 501(c)(3) of the Internal Revenue
18  Code and that is organized and operated primarily for the
19  presentation or support of arts or cultural programming,
20  activities, or services. These organizations include, but
21  are not limited to, music and dramatic arts organizations
22  such as symphony orchestras and theatrical groups, arts
23  and cultural service organizations, local arts councils,
24  visual arts organizations, and media arts organizations.
25  On and after July 1, 2001 (the effective date of Public Act
26  92-35), however, an entity otherwise eligible for this

 

 

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1  exemption shall not make tax-free purchases unless it has
2  an active identification number issued by the Department.
3  (10) Personal property sold by a corporation, society,
4  association, foundation, institution, or organization,
5  other than a limited liability company, that is organized
6  and operated as a not-for-profit service enterprise for
7  the benefit of persons 65 years of age or older if the
8  personal property was not purchased by the enterprise for
9  the purpose of resale by the enterprise.
10  (11) Personal property sold to a governmental body, to
11  a corporation, society, association, foundation, or
12  institution organized and operated exclusively for
13  charitable, religious, or educational purposes, or to a
14  not-for-profit corporation, society, association,
15  foundation, institution, or organization that has no
16  compensated officers or employees and that is organized
17  and operated primarily for the recreation of persons 55
18  years of age or older. A limited liability company may
19  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
23  exemption shall make tax-free purchases unless it has an
24  active identification number issued by the Department.
25  (12) (Blank).
26  (12-5) On and after July 1, 2003 and through June 30,

 

 

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1  2004, motor vehicles of the second division with a gross
2  vehicle weight in excess of 8,000 pounds that are subject
3  to the commercial distribution fee imposed under Section
4  3-815.1 of the Illinois Vehicle Code. Beginning on July 1,
5  2004 and through June 30, 2005, the use in this State of
6  motor vehicles of the second division: (i) with a gross
7  vehicle weight rating in excess of 8,000 pounds; (ii) that
8  are subject to the commercial distribution fee imposed
9  under Section 3-815.1 of the Illinois Vehicle Code; and
10  (iii) that are primarily used for commercial purposes.
11  Through June 30, 2005, this exemption applies to repair
12  and replacement parts added after the initial purchase of
13  such a motor vehicle if that motor vehicle is used in a
14  manner that would qualify for the rolling stock exemption
15  otherwise provided for in this Act. For purposes of this
16  paragraph, "used for commercial purposes" means the
17  transportation of persons or property in furtherance of
18  any commercial or industrial enterprise whether for-hire
19  or not.
20  (13) Proceeds from sales to owners, lessors, or
21  shippers of tangible personal property that is utilized by
22  interstate carriers for hire for use as rolling stock
23  moving in interstate commerce and equipment operated by a
24  telecommunications provider, licensed as a common carrier
25  by the Federal Communications Commission, which is
26  permanently installed in or affixed to aircraft moving in

 

 

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1  interstate commerce.
2  (14) Machinery and equipment that will be used by the
3  purchaser, or a lessee of the purchaser, primarily in the
4  process of manufacturing or assembling tangible personal
5  property for wholesale or retail sale or lease, whether
6  the sale or lease is made directly by the manufacturer or
7  by some other person, whether the materials used in the
8  process are owned by the manufacturer or some other
9  person, or whether the sale or lease is made apart from or
10  as an incident to the seller's engaging in the service
11  occupation of producing machines, tools, dies, jigs,
12  patterns, gauges, or other similar items of no commercial
13  value on special order for a particular purchaser. The
14  exemption provided by this paragraph (14) does not include
15  machinery and equipment used in (i) the generation of
16  electricity for wholesale or retail sale; (ii) the
17  generation or treatment of natural or artificial gas for
18  wholesale or retail sale that is delivered to customers
19  through pipes, pipelines, or mains; or (iii) the treatment
20  of water for wholesale or retail sale that is delivered to
21  customers through pipes, pipelines, or mains. The
22  provisions of Public Act 98-583 are declaratory of
23  existing law as to the meaning and scope of this
24  exemption. Beginning on July 1, 2017, the exemption
25  provided by this paragraph (14) includes, but is not
26  limited to, graphic arts machinery and equipment, as

 

 

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1  defined in paragraph (4) of this Section.
2  (15) Proceeds of mandatory service charges separately
3  stated on customers' bills for purchase and consumption of
4  food and beverages, to the extent that the proceeds of the
5  service charge are in fact turned over as tips or as a
6  substitute for tips to the employees who participate
7  directly in preparing, serving, hosting or cleaning up the
8  food or beverage function with respect to which the
9  service charge is imposed.
10  (16) Tangible personal property sold to a purchaser if
11  the purchaser is exempt from use tax by operation of
12  federal law. This paragraph is exempt from the provisions
13  of Section 2-70.
14  (17) Tangible personal property sold to a common
15  carrier by rail or motor that receives the physical
16  possession of the property in Illinois and that transports
17  the property, or shares with another common carrier in the
18  transportation of the property, out of Illinois on a
19  standard uniform bill of lading showing the seller of the
20  property as the shipper or consignor of the property to a
21  destination outside Illinois, for use outside Illinois.
22  (18) Legal tender, currency, medallions, or gold or
23  silver coinage issued by the State of Illinois, the
24  government of the United States of America, or the
25  government of any foreign country, and bullion.
26  (19) Until July 1, 2003, oil field exploration,

 

 

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1  drilling, and production equipment, including (i) rigs and
2  parts of rigs, rotary rigs, cable tool rigs, and workover
3  rigs, (ii) pipe and tubular goods, including casing and
4  drill strings, (iii) pumps and pump-jack units, (iv)
5  storage tanks and flow lines, (v) any individual
6  replacement part for oil field exploration, drilling, and
7  production equipment, and (vi) machinery and equipment
8  purchased for lease; but excluding motor vehicles required
9  to be registered under the Illinois Vehicle Code.
10  (20) Photoprocessing machinery and equipment,
11  including repair and replacement parts, both new and used,
12  including that manufactured on special order, certified by
13  the purchaser to be used primarily for photoprocessing,
14  and including photoprocessing machinery and equipment
15  purchased for lease.
16  (21) Until July 1, 2028, coal and aggregate
17  exploration, mining, off-highway hauling, processing,
18  maintenance, and reclamation equipment, including
19  replacement parts and equipment, and including equipment
20  purchased for lease, but excluding motor vehicles required
21  to be registered under the Illinois Vehicle Code. The
22  changes made to this Section by Public Act 97-767 apply on
23  and after July 1, 2003, but no claim for credit or refund
24  is allowed on or after August 16, 2013 (the effective date
25  of Public Act 98-456) for such taxes paid during the
26  period beginning July 1, 2003 and ending on August 16,

 

 

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1  2013 (the effective date of Public Act 98-456).
2  (22) Until June 30, 2013, fuel and petroleum products
3  sold to or used by an air carrier, certified by the carrier
4  to be used for consumption, shipment, or storage in the
5  conduct of its business as an air common carrier, for a
6  flight destined for or returning from a location or
7  locations outside the United States without regard to
8  previous or subsequent domestic stopovers.
9  Beginning July 1, 2013, fuel and petroleum products
10  sold to or used by an air carrier, certified by the carrier
11  to be used for consumption, shipment, or storage in the
12  conduct of its business as an air common carrier, for a
13  flight that (i) is engaged in foreign trade or is engaged
14  in trade between the United States and any of its
15  possessions and (ii) transports at least one individual or
16  package for hire from the city of origination to the city
17  of final destination on the same aircraft, without regard
18  to a change in the flight number of that aircraft.
19  (23) A transaction in which the purchase order is
20  received by a florist who is located outside Illinois, but
21  who has a florist located in Illinois deliver the property
22  to the purchaser or the purchaser's donee in Illinois.
23  (24) Fuel consumed or used in the operation of ships,
24  barges, or vessels that are used primarily in or for the
25  transportation of property or the conveyance of persons
26  for hire on rivers bordering on this State if the fuel is

 

 

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1  delivered by the seller to the purchaser's barge, ship, or
2  vessel while it is afloat upon that bordering river.
3  (25) Except as provided in item (25-5) of this
4  Section, a motor vehicle sold in this State to a
5  nonresident even though the motor vehicle is delivered to
6  the nonresident in this State, if the motor vehicle is not
7  to be titled in this State, and if a drive-away permit is
8  issued to the motor vehicle as provided in Section 3-603
9  of the Illinois Vehicle Code or if the nonresident
10  purchaser has vehicle registration plates to transfer to
11  the motor vehicle upon returning to his or her home state.
12  The issuance of the drive-away permit or having the
13  out-of-state registration plates to be transferred is
14  prima facie evidence that the motor vehicle will not be
15  titled in this State.
16  (25-5) The exemption under item (25) does not apply if
17  the state in which the motor vehicle will be titled does
18  not allow a reciprocal exemption for a motor vehicle sold
19  and delivered in that state to an Illinois resident but
20  titled in Illinois. The tax collected under this Act on
21  the sale of a motor vehicle in this State to a resident of
22  another state that does not allow a reciprocal exemption
23  shall be imposed at a rate equal to the state's rate of tax
24  on taxable property in the state in which the purchaser is
25  a resident, except that the tax shall not exceed the tax
26  that would otherwise be imposed under this Act. At the

 

 

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1  time of the sale, the purchaser shall execute a statement,
2  signed under penalty of perjury, of his or her intent to
3  title the vehicle in the state in which the purchaser is a
4  resident within 30 days after the sale and of the fact of
5  the payment to the State of Illinois of tax in an amount
6  equivalent to the state's rate of tax on taxable property
7  in his or her state of residence and shall submit the
8  statement to the appropriate tax collection agency in his
9  or her state of residence. In addition, the retailer must
10  retain a signed copy of the statement in his or her
11  records. Nothing in this item shall be construed to
12  require the removal of the vehicle from this state
13  following the filing of an intent to title the vehicle in
14  the purchaser's state of residence if the purchaser titles
15  the vehicle in his or her state of residence within 30 days
16  after the date of sale. The tax collected under this Act in
17  accordance with this item (25-5) shall be proportionately
18  distributed as if the tax were collected at the 6.25%
19  general rate imposed under this Act.
20  (25-7) Beginning on July 1, 2007, no tax is imposed
21  under this Act on the sale of an aircraft, as defined in
22  Section 3 of the Illinois Aeronautics Act, if all of the
23  following conditions are met:
24  (1) the aircraft leaves this State within 15 days
25  after the later of either the issuance of the final
26  billing for the sale of the aircraft, or the

 

 

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1  authorized approval for return to service, completion
2  of the maintenance record entry, and completion of the
3  test flight and ground test for inspection, as
4  required by 14 CFR C.F.R. 91.407;
5  (2) the aircraft is not based or registered in
6  this State after the sale of the aircraft; and
7  (3) the seller retains in his or her books and
8  records and provides to the Department a signed and
9  dated certification from the purchaser, on a form
10  prescribed by the Department, certifying that the
11  requirements of this item (25-7) are met. The
12  certificate must also include the name and address of
13  the purchaser, the address of the location where the
14  aircraft is to be titled or registered, the address of
15  the primary physical location of the aircraft, and
16  other information that the Department may reasonably
17  require.
18  For purposes of this item (25-7):
19  "Based in this State" means hangared, stored, or
20  otherwise used, excluding post-sale customizations as
21  defined in this Section, for 10 or more days in each
22  12-month period immediately following the date of the sale
23  of the aircraft.
24  "Registered in this State" means an aircraft
25  registered with the Department of Transportation,
26  Aeronautics Division, or titled or registered with the

 

 

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1  Federal Aviation Administration to an address located in
2  this State.
3  This paragraph (25-7) is exempt from the provisions of
4  Section 2-70.
5  (26) Semen used for artificial insemination of
6  livestock for direct agricultural production.
7  (27) Horses, or interests in horses, registered with
8  and meeting the requirements of any of the Arabian Horse
9  Club Registry of America, Appaloosa Horse Club, American
10  Quarter Horse Association, United States Trotting
11  Association, or Jockey Club, as appropriate, used for
12  purposes of breeding or racing for prizes. This item (27)
13  is exempt from the provisions of Section 2-70, and the
14  exemption provided for under this item (27) applies for
15  all periods beginning May 30, 1995, but no claim for
16  credit or refund is allowed on or after January 1, 2008
17  (the effective date of Public Act 95-88) for such taxes
18  paid during the period beginning May 30, 2000 and ending
19  on January 1, 2008 (the effective date of Public Act
20  95-88).
21  (28) Computers and communications equipment utilized
22  for any hospital purpose and equipment used in the
23  diagnosis, analysis, or treatment of hospital patients
24  sold to a lessor who leases the equipment, under a lease of
25  one year or longer executed or in effect at the time of the
26  purchase, to a hospital that has been issued an active tax

 

 

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1  exemption identification number by the Department under
2  Section 1g of this Act.
3  (29) Personal property sold to a lessor who leases the
4  property, under a lease of one year or longer executed or
5  in effect at the time of the purchase, to a governmental
6  body that has been issued an active tax exemption
7  identification number by the Department under Section 1g
8  of this Act.
9  (30) Beginning with taxable years ending on or after
10  December 31, 1995 and ending with taxable years ending on
11  or before December 31, 2004, personal property that is
12  donated for disaster relief to be used in a State or
13  federally declared disaster area in Illinois or bordering
14  Illinois by a manufacturer or retailer that is registered
15  in this State to a corporation, society, association,
16  foundation, or institution that has been issued a sales
17  tax exemption identification number by the Department that
18  assists victims of the disaster who reside within the
19  declared disaster area.
20  (31) Beginning with taxable years ending on or after
21  December 31, 1995 and ending with taxable years ending on
22  or before December 31, 2004, personal property that is
23  used in the performance of infrastructure repairs in this
24  State, including but not limited to municipal roads and
25  streets, access roads, bridges, sidewalks, waste disposal
26  systems, water and sewer line extensions, water

 

 

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1  distribution and purification facilities, storm water
2  drainage and retention facilities, and sewage treatment
3  facilities, resulting from a State or federally declared
4  disaster in Illinois or bordering Illinois when such
5  repairs are initiated on facilities located in the
6  declared disaster area within 6 months after the disaster.
7  (32) Beginning July 1, 1999, game or game birds sold
8  at a "game breeding and hunting preserve area" as that
9  term is used in the Wildlife Code. This paragraph is
10  exempt from the provisions of Section 2-70.
11  (33) A motor vehicle, as that term is defined in
12  Section 1-146 of the Illinois Vehicle Code, that is
13  donated to a corporation, limited liability company,
14  society, association, foundation, or institution that is
15  determined by the Department to be organized and operated
16  exclusively for educational purposes. For purposes of this
17  exemption, "a corporation, limited liability company,
18  society, association, foundation, or institution organized
19  and operated exclusively for educational purposes" means
20  all tax-supported public schools, private schools that
21  offer systematic instruction in useful branches of
22  learning by methods common to public schools and that
23  compare favorably in their scope and intensity with the
24  course of study presented in tax-supported schools, and
25  vocational or technical schools or institutes organized
26  and operated exclusively to provide a course of study of

 

 

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1  not less than 6 weeks duration and designed to prepare
2  individuals to follow a trade or to pursue a manual,
3  technical, mechanical, industrial, business, or commercial
4  occupation.
5  (34) Beginning January 1, 2000, personal property,
6  including food, purchased through fundraising events for
7  the benefit of a public or private elementary or secondary
8  school, a group of those schools, or one or more school
9  districts if the events are sponsored by an entity
10  recognized by the school district that consists primarily
11  of volunteers and includes parents and teachers of the
12  school children. This paragraph does not apply to
13  fundraising events (i) for the benefit of private home
14  instruction or (ii) for which the fundraising entity
15  purchases the personal property sold at the events from
16  another individual or entity that sold the property for
17  the purpose of resale by the fundraising entity and that
18  profits from the sale to the fundraising entity. This
19  paragraph is exempt from the provisions of Section 2-70.
20  (35) Beginning January 1, 2000 and through December
21  31, 2001, new or used automatic vending machines that
22  prepare and serve hot food and beverages, including
23  coffee, soup, and other items, and replacement parts for
24  these machines. Beginning January 1, 2002 and through June
25  30, 2003, machines and parts for machines used in
26  commercial, coin-operated amusement and vending business

 

 

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1  if a use or occupation tax is paid on the gross receipts
2  derived from the use of the commercial, coin-operated
3  amusement and vending machines. This paragraph is exempt
4  from the provisions of Section 2-70.
5  (35-5) Beginning August 23, 2001 and through June 30,
6  2016, food for human consumption that is to be consumed
7  off the premises where it is sold (other than alcoholic
8  beverages, soft drinks, and food that has been prepared
9  for immediate consumption) and prescription and
10  nonprescription medicines, drugs, medical appliances, and
11  insulin, urine testing materials, syringes, and needles
12  used by diabetics, for human use, when purchased for use
13  by a person receiving medical assistance under Article V
14  of the Illinois Public Aid Code who resides in a licensed
15  long-term care facility, as defined in the Nursing Home
16  Care Act, or a licensed facility as defined in the ID/DD
17  Community Care Act, the MC/DD Act, or the Specialized
18  Mental Health Rehabilitation Act of 2013.
19  (36) Beginning August 2, 2001, computers and
20  communications equipment utilized for any hospital purpose
21  and equipment used in the diagnosis, analysis, or
22  treatment of hospital patients sold to a lessor who leases
23  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

 

 

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1  of this Act. This paragraph is exempt from the provisions
2  of Section 2-70.
3  (37) Beginning August 2, 2001, personal property sold
4  to a lessor who leases the property, under a lease of one
5  year or longer executed or in effect at the time of the
6  purchase, to a governmental body that has been issued an
7  active tax exemption identification number by the
8  Department under Section 1g of this Act. This paragraph is
9  exempt from the provisions of Section 2-70.
10  (38) Beginning on January 1, 2002 and through June 30,
11  2016, tangible personal property purchased from an
12  Illinois retailer by a taxpayer engaged in centralized
13  purchasing activities in Illinois who will, upon receipt
14  of the property in Illinois, temporarily store the
15  property in Illinois (i) for the purpose of subsequently
16  transporting it outside this State for use or consumption
17  thereafter solely outside this State or (ii) for the
18  purpose of being processed, fabricated, or manufactured
19  into, attached to, or incorporated into other tangible
20  personal property to be transported outside this State and
21  thereafter used or consumed solely outside this State. The
22  Director of Revenue shall, pursuant to rules adopted in
23  accordance with the Illinois Administrative Procedure Act,
24  issue a permit to any taxpayer in good standing with the
25  Department who is eligible for the exemption under this
26  paragraph (38). The permit issued under this paragraph

 

 

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1  (38) shall authorize the holder, to the extent and in the
2  manner specified in the rules adopted under this Act, to
3  purchase tangible personal property from a retailer exempt
4  from the taxes imposed by this Act. Taxpayers shall
5  maintain all necessary books and records to substantiate
6  the use and consumption of all such tangible personal
7  property outside of the State of Illinois.
8  (39) Beginning January 1, 2008, tangible personal
9  property used in the construction or maintenance of a
10  community water supply, as defined under Section 3.145 of
11  the Environmental Protection Act, that is operated by a
12  not-for-profit corporation that holds a valid water supply
13  permit issued under Title IV of the Environmental
14  Protection Act. This paragraph is exempt from the
15  provisions of Section 2-70.
16  (40) Beginning January 1, 2010 and continuing through
17  December 31, 2024, materials, parts, equipment,
18  components, and furnishings incorporated into or upon an
19  aircraft as part of the modification, refurbishment,
20  completion, replacement, repair, or maintenance of the
21  aircraft. This exemption includes consumable supplies used
22  in the modification, refurbishment, completion,
23  replacement, repair, and maintenance of aircraft. However,
24  until January 1, 2024, this exemption , but excludes any
25  materials, parts, equipment, components, and consumable
26  supplies used in the modification, replacement, repair,

 

 

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1  and maintenance of aircraft engines or power plants,
2  whether such engines or power plants are installed or
3  uninstalled upon any such aircraft. "Consumable supplies"
4  include, but are not limited to, adhesive, tape,
5  sandpaper, general purpose lubricants, cleaning solution,
6  latex gloves, and protective films.
7  Beginning January 1, 2010 and continuing through
8  December 31, 2023, this This exemption applies only to the
9  sale of qualifying tangible personal property to persons
10  who modify, refurbish, complete, replace, or maintain an
11  aircraft and who (i) hold an Air Agency Certificate and
12  are empowered to operate an approved repair station by the
13  Federal Aviation Administration, (ii) have a Class IV
14  Rating, and (iii) conduct operations in accordance with
15  Part 145 of the Federal Aviation Regulations. The
16  exemption does not include aircraft operated by a
17  commercial air carrier providing scheduled passenger air
18  service pursuant to authority issued under Part 121 or
19  Part 129 of the Federal Aviation Regulations. From January
20  1, 2024 through December 31, 2024, this exemption applies
21  only to the use of qualifying tangible personal property
22  by: (A) persons who modify, refurbish, complete, repair,
23  replace, or maintain aircraft and who (i) hold an Air
24  Agency Certificate and are empowered to operate an
25  approved repair station by the Federal Aviation
26  Administration, (ii) have a Class IV Rating, and (iii)

 

 

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1  conduct operations in accordance with Part 145 of the
2  Federal Aviation Regulations; and (B) persons who engage
3  in the modification, replacement, repair, and maintenance
4  of aircraft engines or power plants without regard to
5  whether or not those persons meet the qualifications of
6  item (A).
7  The changes made to this paragraph (40) by Public Act
8  98-534 are declarative of existing law. It is the intent
9  of the General Assembly that the exemption under this
10  paragraph (40) applies continuously from January 1, 2010
11  through December 31, 2024; however, no claim for credit or
12  refund is allowed for taxes paid as a result of the
13  disallowance of this exemption on or after January 1, 2015
14  and prior to February 5, 2020 (the effective date of
15  Public Act 101-629) this amendatory Act of the 101st
16  General Assembly.
17  (41) Tangible personal property sold to a
18  public-facilities corporation, as described in Section
19  11-65-10 of the Illinois Municipal Code, for purposes of
20  constructing or furnishing a municipal convention hall,
21  but only if the legal title to the municipal convention
22  hall is transferred to the municipality without any
23  further consideration by or on behalf of the municipality
24  at the time of the completion of the municipal convention
25  hall or upon the retirement or redemption of any bonds or
26  other debt instruments issued by the public-facilities

 

 

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1  corporation in connection with the development of the
2  municipal convention hall. This exemption includes
3  existing public-facilities corporations as provided in
4  Section 11-65-25 of the Illinois Municipal Code. This
5  paragraph is exempt from the provisions of Section 2-70.
6  (42) Beginning January 1, 2017 and through December
7  31, 2026, menstrual pads, tampons, and menstrual cups.
8  (43) Merchandise that is subject to the Rental
9  Purchase Agreement Occupation and Use Tax. The purchaser
10  must certify that the item is purchased to be rented
11  subject to a rental purchase agreement, as defined in the
12  Rental Purchase Agreement Act, and provide proof of
13  registration under the Rental Purchase Agreement
14  Occupation and Use Tax Act. This paragraph is exempt from
15  the provisions of Section 2-70.
16  (44) Qualified tangible personal property used in the
17  construction or operation of a data center that has been
18  granted a certificate of exemption by the Department of
19  Commerce and Economic Opportunity, whether that tangible
20  personal property is purchased by the owner, operator, or
21  tenant of the data center or by a contractor or
22  subcontractor of the owner, operator, or tenant. Data
23  centers that would have qualified for a certificate of
24  exemption prior to January 1, 2020 had Public Act 101-31
25  this amendatory Act of the 101st General Assembly been in
26  effect, may apply for and obtain an exemption for

 

 

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1  subsequent purchases of computer equipment or enabling
2  software purchased or leased to upgrade, supplement, or
3  replace computer equipment or enabling software purchased
4  or leased in the original investment that would have
5  qualified.
6  The Department of Commerce and Economic Opportunity
7  shall grant a certificate of exemption under this item
8  (44) to qualified data centers as defined by Section
9  605-1025 of the Department of Commerce and Economic
10  Opportunity Law of the Civil Administrative Code of
11  Illinois.
12  For the purposes of this item (44):
13  "Data center" means a building or a series of
14  buildings rehabilitated or constructed to house
15  working servers in one physical location or multiple
16  sites within the State of Illinois.
17  "Qualified tangible personal property" means:
18  electrical systems and equipment; climate control and
19  chilling equipment and systems; mechanical systems and
20  equipment; monitoring and secure systems; emergency
21  generators; hardware; computers; servers; data storage
22  devices; network connectivity equipment; racks;
23  cabinets; telecommunications cabling infrastructure;
24  raised floor systems; peripheral components or
25  systems; software; mechanical, electrical, or plumbing
26  systems; battery systems; cooling systems and towers;

 

 

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1  temperature control systems; other cabling; and other
2  data center infrastructure equipment and systems
3  necessary to operate qualified tangible personal
4  property, including fixtures; and component parts of
5  any of the foregoing, including installation,
6  maintenance, repair, refurbishment, and replacement of
7  qualified tangible personal property to generate,
8  transform, transmit, distribute, or manage electricity
9  necessary to operate qualified tangible personal
10  property; and all other tangible personal property
11  that is essential to the operations of a computer data
12  center. The term "qualified tangible personal
13  property" also includes building materials physically
14  incorporated into the qualifying data center. To
15  document the exemption allowed under this Section, the
16  retailer must obtain from the purchaser a copy of the
17  certificate of eligibility issued by the Department of
18  Commerce and Economic Opportunity.
19  This item (44) is exempt from the provisions of
20  Section 2-70.
21  (45) Beginning January 1, 2020 and through December
22  31, 2020, sales of tangible personal property made by a
23  marketplace seller over a marketplace for which tax is due
24  under this Act but for which use tax has been collected and
25  remitted to the Department by a marketplace facilitator
26  under Section 2d of the Use Tax Act are exempt from tax

 

 

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HB2518 Engrossed- 86 -LRB103 28353 HLH 54733 b   HB2518 Engrossed - 86 - LRB103 28353 HLH 54733 b
  HB2518 Engrossed - 86 - LRB103 28353 HLH 54733 b
1  under this Act. A marketplace seller claiming this
2  exemption shall maintain books and records demonstrating
3  that the use tax on such sales has been collected and
4  remitted by a marketplace facilitator. Marketplace sellers
5  that have properly remitted tax under this Act on such
6  sales may file a claim for credit as provided in Section 6
7  of this Act. No claim is allowed, however, for such taxes
8  for which a credit or refund has been issued to the
9  marketplace facilitator under the Use Tax Act, or for
10  which the marketplace facilitator has filed a claim for
11  credit or refund under the Use Tax Act.
12  (46) Beginning July 1, 2022, breast pumps, breast pump
13  collection and storage supplies, and breast pump kits.
14  This item (46) is exempt from the provisions of Section
15  2-70. As used in this item (46):
16  "Breast pump" means an electrically controlled or
17  manually controlled pump device designed or marketed to be
18  used to express milk from a human breast during lactation,
19  including the pump device and any battery, AC adapter, or
20  other power supply unit that is used to power the pump
21  device and is packaged and sold with the pump device at the
22  time of sale.
23  "Breast pump collection and storage supplies" means
24  items of tangible personal property designed or marketed
25  to be used in conjunction with a breast pump to collect
26  milk expressed from a human breast and to store collected

 

 

  HB2518 Engrossed - 86 - LRB103 28353 HLH 54733 b


HB2518 Engrossed- 87 -LRB103 28353 HLH 54733 b   HB2518 Engrossed - 87 - LRB103 28353 HLH 54733 b
  HB2518 Engrossed - 87 - LRB103 28353 HLH 54733 b
1  milk until it is ready for consumption.
2  "Breast pump collection and storage supplies"
3  includes, but is not limited to: breast shields and breast
4  shield connectors; breast pump tubes and tubing adapters;
5  breast pump valves and membranes; backflow protectors and
6  backflow protector adaptors; bottles and bottle caps
7  specific to the operation of the breast pump; and breast
8  milk storage bags.
9  "Breast pump collection and storage supplies" does not
10  include: (1) bottles and bottle caps not specific to the
11  operation of the breast pump; (2) breast pump travel bags
12  and other similar carrying accessories, including ice
13  packs, labels, and other similar products; (3) breast pump
14  cleaning supplies; (4) nursing bras, bra pads, breast
15  shells, and other similar products; and (5) creams,
16  ointments, and other similar products that relieve
17  breastfeeding-related symptoms or conditions of the
18  breasts or nipples, unless sold as part of a breast pump
19  kit that is pre-packaged by the breast pump manufacturer
20  or distributor.
21  "Breast pump kit" means a kit that: (1) contains no
22  more than a breast pump, breast pump collection and
23  storage supplies, a rechargeable battery for operating the
24  breast pump, a breastmilk cooler, bottle stands, ice
25  packs, and a breast pump carrying case; and (2) is
26  pre-packaged as a breast pump kit by the breast pump

 

 

  HB2518 Engrossed - 87 - LRB103 28353 HLH 54733 b


HB2518 Engrossed- 88 -LRB103 28353 HLH 54733 b   HB2518 Engrossed - 88 - LRB103 28353 HLH 54733 b
  HB2518 Engrossed - 88 - LRB103 28353 HLH 54733 b
1  manufacturer or distributor.
2  (47) (46) Tangible personal property sold by or on
3  behalf of the State Treasurer pursuant to the Revised
4  Uniform Unclaimed Property Act. This item (47) (46) is
5  exempt from the provisions of Section 2-70.
6  (Source: P.A. 101-31, eff. 6-28-19; 101-81, eff. 7-12-19;
7  101-629, eff. 2-5-20; 102-16, eff. 6-17-21; 102-634, eff.
8  8-27-21; 102-700, Article 70, Section 70-20, eff. 4-19-22;
9  102-700, Article 75, Section 75-20, eff. 4-19-22; 102-813,
10  eff. 5-13-22; 102-1026, eff. 5-27-22; revised 8-15-22.)
11  Section 99. Effective date. This Act takes effect upon
12  becoming law.

 

 

  HB2518 Engrossed - 88 - LRB103 28353 HLH 54733 b