Illinois 2023-2024 Regular Session

Illinois House Bill HB4054 Compare Versions

Only one version of the bill is available at this time.

Old	New	Differences
1	1	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB4054 Introduced , by Rep. Kelly M. Burke SYNOPSIS AS INTRODUCED: 35 ILCS 105/2d35 ILCS 110/2d 35 ILCS 120/1 from Ch. 120, par. 440 Amends the Use Tax Act, the Service Use Tax Act, and the Retailers' Occupation Tax Act. Provides that a delivery network company that delivers tangible personal property on behalf of a marketplace seller or a marketplace serviceman is not considered a marketplace facilitator. Provides that a delivery network company is a business that facilitates, through the use of an Internet website or mobile application, the delivery of local products. Provides that a local product is any item, including food, other than freight, mail, or a package to which postage has been affixed. Effective immediately. LRB103 31848 HLH 60483 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB4054 Introduced , by Rep. Kelly M. Burke SYNOPSIS AS INTRODUCED: 35 ILCS 105/2d35 ILCS 110/2d 35 ILCS 120/1 from Ch. 120, par. 440 35 ILCS 105/2d 35 ILCS 110/2d 35 ILCS 120/1 from Ch. 120, par. 440 Amends the Use Tax Act, the Service Use Tax Act, and the Retailers' Occupation Tax Act. Provides that a delivery network company that delivers tangible personal property on behalf of a marketplace seller or a marketplace serviceman is not considered a marketplace facilitator. Provides that a delivery network company is a business that facilitates, through the use of an Internet website or mobile application, the delivery of local products. Provides that a local product is any item, including food, other than freight, mail, or a package to which postage has been affixed. Effective immediately. LRB103 31848 HLH 60483 b LRB103 31848 HLH 60483 b A BILL FOR
2	2	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB4054 Introduced , by Rep. Kelly M. Burke SYNOPSIS AS INTRODUCED:
3	3	35 ILCS 105/2d35 ILCS 110/2d 35 ILCS 120/1 from Ch. 120, par. 440 35 ILCS 105/2d 35 ILCS 110/2d 35 ILCS 120/1 from Ch. 120, par. 440
4	4	35 ILCS 105/2d
5	5	35 ILCS 110/2d
6	6	35 ILCS 120/1 from Ch. 120, par. 440
7	7	Amends the Use Tax Act, the Service Use Tax Act, and the Retailers' Occupation Tax Act. Provides that a delivery network company that delivers tangible personal property on behalf of a marketplace seller or a marketplace serviceman is not considered a marketplace facilitator. Provides that a delivery network company is a business that facilitates, through the use of an Internet website or mobile application, the delivery of local products. Provides that a local product is any item, including food, other than freight, mail, or a package to which postage has been affixed. Effective immediately.
8	8	LRB103 31848 HLH 60483 b LRB103 31848 HLH 60483 b
9	9	LRB103 31848 HLH 60483 b
10	10	A BILL FOR
11	11	HB4054LRB103 31848 HLH 60483 b HB4054 LRB103 31848 HLH 60483 b
12	12	HB4054 LRB103 31848 HLH 60483 b
13	13	1 AN ACT concerning revenue.
14	14	2 Be it enacted by the People of the State of Illinois,
15	15	3 represented in the General Assembly:
16	16	4 Section 5. The Use Tax Act is amended by changing Section
17	17	5 2d as follows:
18	18	6 (35 ILCS 105/2d)
19	19	7 Sec. 2d. Marketplace facilitators and marketplace sellers.
20	20	8 (a) As used in this Section:
21	21	9 "Affiliate" means a person that, with respect to another
22	22	10 person: (i) has a direct or indirect ownership interest of
23	23	11 more than 5 percent in the other person; or (ii) is related to
24	24	12 the other person because a third person, or a group of third
25	25	13 persons who are affiliated with each other as defined in this
26	26	14 subsection, holds a direct or indirect ownership interest of
27	27	15 more than 5% in the related person.
28	28	16 "Delivery network company" means a business that
29	29	17 facilitates, through the use of an Internet website or mobile
30	30	18 application, the delivery of local products.
31	31	19 "Local product" means any item, including food, other than
32	32	20 freight, mail, or a package to which postage has been affixed.
33	33	21 "Marketplace" means a physical or electronic place, forum,
34	34	22 platform, application, or other method by which a marketplace
35	35	23 seller sells or offers to sell items.
36	36
37	37
38	38
39	39	103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB4054 Introduced , by Rep. Kelly M. Burke SYNOPSIS AS INTRODUCED:
40	40	35 ILCS 105/2d35 ILCS 110/2d 35 ILCS 120/1 from Ch. 120, par. 440 35 ILCS 105/2d 35 ILCS 110/2d 35 ILCS 120/1 from Ch. 120, par. 440
41	41	35 ILCS 105/2d
42	42	35 ILCS 110/2d
43	43	35 ILCS 120/1 from Ch. 120, par. 440
44	44	Amends the Use Tax Act, the Service Use Tax Act, and the Retailers' Occupation Tax Act. Provides that a delivery network company that delivers tangible personal property on behalf of a marketplace seller or a marketplace serviceman is not considered a marketplace facilitator. Provides that a delivery network company is a business that facilitates, through the use of an Internet website or mobile application, the delivery of local products. Provides that a local product is any item, including food, other than freight, mail, or a package to which postage has been affixed. Effective immediately.
45	45	LRB103 31848 HLH 60483 b LRB103 31848 HLH 60483 b
46	46	LRB103 31848 HLH 60483 b
47	47	A BILL FOR
48	48
49	49
50	50
51	51
52	52
53	53	35 ILCS 105/2d
54	54	35 ILCS 110/2d
55	55	35 ILCS 120/1 from Ch. 120, par. 440
56	56
57	57
58	58
59	59	LRB103 31848 HLH 60483 b
60	60
61	61
62	62
63	63
64	64
65	65
66	66
67	67
68	68
69	69	HB4054 LRB103 31848 HLH 60483 b
70	70
71	71
72	72	HB4054- 2 -LRB103 31848 HLH 60483 b HB4054 - 2 - LRB103 31848 HLH 60483 b
73	73	HB4054 - 2 - LRB103 31848 HLH 60483 b
74	74	1 "Marketplace facilitator" means a person who, pursuant to
75	75	2 an agreement with an unrelated third-party marketplace seller,
76	76	3 directly or indirectly through one or more affiliates
77	77	4 facilitates a retail sale by an unrelated third party
78	78	5 marketplace seller by:
79	79	6 (1) listing or advertising for sale by the marketplace
80	80	7 seller in a marketplace, tangible personal property that
81	81	8 is subject to tax under this Act; and
82	82	9 (2) either directly or indirectly, through agreements
83	83	10 or arrangements with third parties, collecting payment
84	84	11 from the customer and transmitting that payment to the
85	85	12 marketplace seller regardless of whether the marketplace
86	86	13 facilitator receives compensation or other consideration
87	87	14 in exchange for its services.
88	88	15 "Marketplace facilitator" does not include a delivery
89	89	16 network company that delivers tangible personal property on
90	90	17 behalf of a marketplace seller that is engaged in business as a
91	91	18 retail vendor.
92	92	19 "Marketplace seller" means a person that sells or offers
93	93	20 to sell tangible personal property through a marketplace
94	94	21 operated by an unrelated third-party marketplace facilitator.
95	95	22 (b) Beginning on January 1, 2020, a marketplace
96	96	23 facilitator who meets either of the following thresholds is
97	97	24 considered the retailer for each sale of tangible personal
98	98	25 property made through its marketplace:
99	99	26 (1) the cumulative gross receipts from sales of
100	100
101	101
102	102
103	103
104	104
105	105	HB4054 - 2 - LRB103 31848 HLH 60483 b
106	106
107	107
108	108	HB4054- 3 -LRB103 31848 HLH 60483 b HB4054 - 3 - LRB103 31848 HLH 60483 b
109	109	HB4054 - 3 - LRB103 31848 HLH 60483 b
110	110	1 tangible personal property to purchasers in Illinois by
111	111	2 the marketplace facilitator and by marketplace sellers
112	112	3 selling through the marketplace are $100,000 or more; or
113	113	4 (2) the marketplace facilitator and marketplace
114	114	5 sellers selling through the marketplace cumulatively enter
115	115	6 into 200 or more separate transactions for the sale of
116	116	7 tangible personal property to purchasers in Illinois.
117	117	8 A marketplace facilitator shall determine on a quarterly
118	118	9 basis, ending on the last day of March, June, September, and
119	119	10 December, whether he or she meets the threshold of either
120	120	11 paragraph (1) or (2) of this subsection (b) for the preceding
121	121	12 12-month period. If the marketplace facilitator meets the
122	122	13 threshold of either paragraph (1) or (2) for a 12-month
123	123	14 period, he or she is considered a retailer maintaining a place
124	124	15 of business in this State and is required to collect and remit
125	125	16 the tax imposed under this Act and file returns for one year.
126	126	17 At the end of that one-year period, the marketplace
127	127	18 facilitator shall determine whether the marketplace
128	128	19 facilitator met the threshold of either paragraph (1) or (2)
129	129	20 during the preceding 12-month period. If the marketplace
130	130	21 facilitator met the threshold in either paragraph (1) or (2)
131	131	22 for the preceding 12-month period, he or she is considered a
132	132	23 retailer maintaining a place of business in this State and is
133	133	24 required to collect and remit the tax imposed under this Act
134	134	25 and file returns for the subsequent year. If at the end of a
135	135	26 one-year period a marketplace facilitator that was required to
136	136
137	137
138	138
139	139
140	140
141	141	HB4054 - 3 - LRB103 31848 HLH 60483 b
142	142
143	143
144	144	HB4054- 4 -LRB103 31848 HLH 60483 b HB4054 - 4 - LRB103 31848 HLH 60483 b
145	145	HB4054 - 4 - LRB103 31848 HLH 60483 b
146	146	1 collect and remit the tax imposed under this Act determines
147	147	2 that he or she did not meet the threshold in either paragraph
148	148	3 (1) or (2) during the preceding 12-month period, the
149	149	4 marketplace facilitator shall subsequently determine on a
150	150	5 quarterly basis, ending on the last day of March, June,
151	151	6 September, and December, whether he or she meets the threshold
152	152	7 of either paragraph (1) or (2) for the preceding 12-month
153	153	8 period.
154	154	9 (c) Beginning on January 1, 2020 a marketplace facilitator
155	155	10 considered to be the retailer pursuant to subsection (b) of
156	156	11 this Section is considered the retailer with respect to each
157	157	12 sale made through its marketplace and is liable for collecting
158	158	13 and remitting the tax under this Act on all such sales. The
159	159	14 marketplace facilitator who is considered to be the retailer
160	160	15 under subsection (b) for sales made through its marketplace
161	161	16 has all the rights and duties, and is required to comply with
162	162	17 the same requirements and procedures, as all other retailers
163	163	18 maintaining a place of business in this State who are
164	164	19 registered or who are required to be registered to collect and
165	165	20 remit the tax imposed by this Act with respect to such sales.
166	166	21 (d) A marketplace facilitator shall:
167	167	22 (1) certify to each marketplace seller that the
168	168	23 marketplace facilitator assumes the rights and duties of a
169	169	24 retailer under this Act with respect to sales made by the
170	170	25 marketplace seller through the marketplace; and
171	171	26 (2) collect taxes imposed by this Act as required by
172	172
173	173
174	174
175	175
176	176
177	177	HB4054 - 4 - LRB103 31848 HLH 60483 b
178	178
179	179
180	180	HB4054- 5 -LRB103 31848 HLH 60483 b HB4054 - 5 - LRB103 31848 HLH 60483 b
181	181	HB4054 - 5 - LRB103 31848 HLH 60483 b
182	182	1 Section 3-45 of this Act for sales made through the
183	183	2 marketplace.
184	184	3 (e) A marketplace seller shall retain books and records
185	185	4 for all sales made through a marketplace in accordance with
186	186	5 the requirements of Section 11.
187	187	6 (f) A marketplace seller shall furnish to the marketplace
188	188	7 facilitator information that is necessary for the marketplace
189	189	8 facilitator to correctly collect and remit taxes for a retail
190	190	9 sale. The information may include a certification that an item
191	191	10 being sold is taxable, not taxable, exempt from taxation, or
192	192	11 taxable at a specified rate. A marketplace seller shall be
193	193	12 held harmless for liability for the tax imposed under this Act
194	194	13 when a marketplace facilitator fails to correctly collect and
195	195	14 remit tax after having been provided with information by a
196	196	15 marketplace seller to correctly collect and remit taxes
197	197	16 imposed under this Act.
198	198	17 (g) If the marketplace facilitator demonstrates to the
199	199	18 satisfaction of the Department that its failure to correctly
200	200	19 collect and remit tax on a retail sale resulted from the
201	201	20 marketplace facilitator's good faith reliance on incorrect or
202	202	21 insufficient information provided by a marketplace seller, it
203	203	22 shall be relieved of liability for the tax on that retail sale.
204	204	23 In this case, a marketplace seller is liable for any resulting
205	205	24 tax due.
206	206	25 (h) (Blank).
207	207	26 (i) This Section does not affect the tax liability of a
208	208
209	209
210	210
211	211
212	212
213	213	HB4054 - 5 - LRB103 31848 HLH 60483 b
214	214
215	215
216	216	HB4054- 6 -LRB103 31848 HLH 60483 b HB4054 - 6 - LRB103 31848 HLH 60483 b
217	217	HB4054 - 6 - LRB103 31848 HLH 60483 b
218	218	1 purchaser under this Act.
219	219	2 (j) (Blank).
220	220	3 (k) A marketplace facilitator required to collect taxes
221	221	4 imposed under this Section and this Act on retail sales made
222	222	5 through its marketplace shall be liable to the Department for
223	223	6 such taxes, except when the marketplace facilitator is
224	224	7 relieved of the duty to remit such taxes by virtue of having
225	225	8 paid to the Department taxes imposed by the Retailers'
226	226	9 Occupation Tax Act upon his or her gross receipts from the same
227	227	10 transactions.
228	228	11 (l) If, for any reason, the Department is prohibited from
229	229	12 enforcing the marketplace facilitator's duty under this Act to
230	230	13 collect and remit taxes pursuant to this Section, the duty to
231	231	14 collect and remit such taxes reverts to the marketplace seller
232	232	15 that is a retailer maintaining a place of business in this
233	233	16 State pursuant to Section 2.
234	234	17 (Source: P.A. 101-9, eff. 6-5-19; 101-604, eff. 1-1-20.)
235	235	18 Section 10. The Service Use Tax Act is amended by changing
236	236	19 Section 2d as follows:
237	237	20 (35 ILCS 110/2d)
238	238	21 Sec. 2d. Marketplace facilitators and marketplace
239	239	22 servicemen.
240	240	23 (a) Definitions. For purposes of this Section:
241	241	24 "Affiliate" means a person that, with respect to another
242	242
243	243
244	244
245	245
246	246
247	247	HB4054 - 6 - LRB103 31848 HLH 60483 b
248	248
249	249
250	250	HB4054- 7 -LRB103 31848 HLH 60483 b HB4054 - 7 - LRB103 31848 HLH 60483 b
251	251	HB4054 - 7 - LRB103 31848 HLH 60483 b
252	252	1 person: (i) has a direct or indirect ownership interest of
253	253	2 more than 5% in the other person; or (ii) is related to the
254	254	3 other person because a third person, or group of third persons
255	255	4 who are affiliated with each other as defined in this
256	256	5 subsection, holds a direct or indirect ownership interest of
257	257	6 more than 5% in the related person.
258	258	7 "Delivery network company" means a business that
259	259	8 facilitates, through the use of an Internet website or mobile
260	260	9 application, the delivery of local products.
261	261	10 "Local product" means any item, including food, other than
262	262	11 freight, mail, or a package to which postage has been affixed.
263	263	12 "Marketplace" means a physical or electronic place, forum,
264	264	13 platform, application or other method by which a marketplace
265	265	14 serviceman makes or offers to make sales of service.
266	266	15 "Marketplace facilitator" means a person who, pursuant to
267	267	16 an agreement with a marketplace serviceman, facilitates sales
268	268	17 of service by that marketplace serviceman. A person
269	269	18 facilitates a sale of service by, directly or indirectly
270	270	19 through one or more affiliates, doing both of the following:
271	271	20 (i) listing or otherwise making available a sale of service of
272	272	21 the marketplace serviceman through a marketplace owned or
273	273	22 operated by the marketplace facilitator; and (ii) processing
274	274	23 sales of service for, or payments for sales of service by,
275	275	24 marketplace servicemen.
276	276	25 "Marketplace facilitator" does not include a delivery
277	277	26 network company that delivers tangible personal property on
278	278
279	279
280	280
281	281
282	282
283	283	HB4054 - 7 - LRB103 31848 HLH 60483 b
284	284
285	285
286	286	HB4054- 8 -LRB103 31848 HLH 60483 b HB4054 - 8 - LRB103 31848 HLH 60483 b
287	287	HB4054 - 8 - LRB103 31848 HLH 60483 b
288	288	1 behalf of a marketplace serviceman that is engaged in business
289	289	2 as a retail vendor.
290	290	3 "Marketplace serviceman" means a person that makes or
291	291	4 offers to make a sale of service through a marketplace.
292	292	5 (b) Beginning January 1, 2020, a marketplace facilitator
293	293	6 who meets either of the following criteria is considered the
294	294	7 serviceman for each sale of service made on the marketplace:
295	295	8 (1) the cumulative gross receipts from sales of
296	296	9 service to purchasers in Illinois by the marketplace
297	297	10 facilitator and by marketplace servicemen are $100,000 or
298	298	11 more; or
299	299	12 (2) the marketplace facilitator and marketplace
300	300	13 servicemen cumulatively enter into 200 or more separate
301	301	14 transactions for the sale of service to purchasers in
302	302	15 Illinois.
303	303	16 A marketplace facilitator shall determine on a quarterly
304	304	17 basis, ending on the last day of March, June, September, and
305	305	18 December, whether he or she meets the criteria of either
306	306	19 paragraph (1) or (2) of this subsection (b) for the preceding
307	307	20 12-month period. If the marketplace facilitator meets the
308	308	21 criteria of either paragraph (1) or (2) for a 12-month period,
309	309	22 he or she is considered a serviceman maintaining a place of
310	310	23 business in this State and is required to collect and remit the
311	311	24 tax imposed under this Act and file returns for one year. At
312	312	25 the end of that one-year period, the marketplace facilitator
313	313	26 shall determine whether the marketplace facilitator met the
314	314
315	315
316	316
317	317
318	318
319	319	HB4054 - 8 - LRB103 31848 HLH 60483 b
320	320
321	321
322	322	HB4054- 9 -LRB103 31848 HLH 60483 b HB4054 - 9 - LRB103 31848 HLH 60483 b
323	323	HB4054 - 9 - LRB103 31848 HLH 60483 b
324	324	1 criteria of either paragraph (1) or (2) during the preceding
325	325	2 12-month period. If the marketplace facilitator met the
326	326	3 criteria in either paragraph (1) or (2) for the preceding
327	327	4 12-month period, he or she is considered a serviceman
328	328	5 maintaining a place of business in this State and is required
329	329	6 to collect and remit the tax imposed under this Act and file
330	330	7 returns for the subsequent year. If, at the end of a one-year
331	331	8 period, a marketplace facilitator that was required to collect
332	332	9 and remit the tax imposed under this Act determines that he or
333	333	10 she did not meet the criteria in either paragraph (1) or (2)
334	334	11 during the preceding 12-month period, the marketplace
335	335	12 facilitator shall subsequently determine on a quarterly basis,
336	336	13 ending on the last day of March, June, September, and
337	337	14 December, whether he or she meets the criteria of either
338	338	15 paragraph (1) or (2) for the preceding 12-month period.
339	339	16 (c) A marketplace facilitator that meets either of the
340	340	17 thresholds in subsection (b) of this Section is considered the
341	341	18 serviceman for each sale of service made through its
342	342	19 marketplace and is liable for collecting and remitting the tax
343	343	20 under this Act on all such sales. The marketplace facilitator
344	344	21 has all the rights and duties, and is required to comply with
345	345	22 the same requirements and procedures, as all other servicemen
346	346	23 maintaining a place of business in this State who are
347	347	24 registered or who are required to be registered to collect and
348	348	25 remit the tax imposed by this Act.
349	349	26 (d) A marketplace facilitator shall:
350	350
351	351
352	352
353	353
354	354
355	355	HB4054 - 9 - LRB103 31848 HLH 60483 b
356	356
357	357
358	358	HB4054- 10 -LRB103 31848 HLH 60483 b HB4054 - 10 - LRB103 31848 HLH 60483 b
359	359	HB4054 - 10 - LRB103 31848 HLH 60483 b
360	360	1 (1) certify to each marketplace serviceman that the
361	361	2 marketplace facilitator assumes the rights and duties of a
362	362	3 serviceman under this Act with respect to sales of service
363	363	4 made by the marketplace serviceman through the
364	364	5 marketplace; and
365	365	6 (2) collect taxes imposed by this Act as required by
366	366	7 Section 3-40 of this Act for sales of service made through
367	367	8 the marketplace.
368	368	9 (e) A marketplace serviceman shall retain books and
369	369	10 records for all sales of service made through a marketplace in
370	370	11 accordance with the requirements of Section 11.
371	371	12 (f) A marketplace serviceman shall furnish to the
372	372	13 marketplace facilitator information that is necessary for the
373	373	14 marketplace facilitator to correctly collect and remit taxes
374	374	15 for a sale of service. The information may include a
375	375	16 certification that an item transferred incident to a sale of
376	376	17 service under this Act is taxable, not taxable, exempt from
377	377	18 taxation, or taxable at a specified rate. A marketplace
378	378	19 serviceman shall be held harmless for liability for the tax
379	379	20 imposed under this Act when a marketplace facilitator fails to
380	380	21 correctly collect and remit tax after having been provided
381	381	22 with information by a marketplace serviceman to correctly
382	382	23 collect and remit taxes imposed under this Act.
383	383	24 (g) Except as provided in subsection (h), if the
384	384	25 marketplace facilitator demonstrates to the satisfaction of
385	385	26 the Department that its failure to correctly collect and remit
386	386
387	387
388	388
389	389
390	390
391	391	HB4054 - 10 - LRB103 31848 HLH 60483 b
392	392
393	393
394	394	HB4054- 11 -LRB103 31848 HLH 60483 b HB4054 - 11 - LRB103 31848 HLH 60483 b
395	395	HB4054 - 11 - LRB103 31848 HLH 60483 b
396	396	1 tax on a sale of service resulted from the marketplace
397	397	2 facilitator's good faith reliance on incorrect or insufficient
398	398	3 information provided by a marketplace serviceman, it shall be
399	399	4 relieved of liability for the tax on that sale of service. In
400	400	5 this case, a marketplace serviceman is liable for any
401	401	6 resulting tax due.
402	402	7 (h) A marketplace facilitator and marketplace serviceman
403	403	8 that are affiliates, as defined by subsection (a), are jointly
404	404	9 and severally liable for tax liability resulting from a sale
405	405	10 of service made by the affiliated marketplace serviceman
406	406	11 through the marketplace.
407	407	12 (i) This Section does not affect the tax liability of a
408	408	13 purchaser under this Act.
409	409	14 (j) The Department may adopt rules for the administration
410	410	15 and enforcement of the provisions of this Section.
411	411	16 (Source: P.A. 101-9, eff. 6-5-19.)
412	412	17 Section 15. The Retailers' Occupation Tax Act is amended
413	413	18 by changing Section 1 as follows:
414	414	19 (35 ILCS 120/1) (from Ch. 120, par. 440)
415	415	20 Sec. 1. Definitions. "Sale at retail" means any transfer
416	416	21 of the ownership of or title to tangible personal property to a
417	417	22 purchaser, for the purpose of use or consumption, and not for
418	418	23 the purpose of resale in any form as tangible personal
419	419	24 property to the extent not first subjected to a use for which
420	420
421	421
422	422
423	423
424	424
425	425	HB4054 - 11 - LRB103 31848 HLH 60483 b
426	426
427	427
428	428	HB4054- 12 -LRB103 31848 HLH 60483 b HB4054 - 12 - LRB103 31848 HLH 60483 b
429	429	HB4054 - 12 - LRB103 31848 HLH 60483 b
430	430	1 it was purchased, for a valuable consideration: Provided that
431	431	2 the property purchased is deemed to be purchased for the
432	432	3 purpose of resale, despite first being used, to the extent to
433	433	4 which it is resold as an ingredient of an intentionally
434	434	5 produced product or byproduct of manufacturing. For this
435	435	6 purpose, slag produced as an incident to manufacturing pig
436	436	7 iron or steel and sold is considered to be an intentionally
437	437	8 produced byproduct of manufacturing. Transactions whereby the
438	438	9 possession of the property is transferred but the seller
439	439	10 retains the title as security for payment of the selling price
440	440	11 shall be deemed to be sales.
441	441	12 "Sale at retail" shall be construed to include any
442	442	13 transfer of the ownership of or title to tangible personal
443	443	14 property to a purchaser, for use or consumption by any other
444	444	15 person to whom such purchaser may transfer the tangible
445	445	16 personal property without a valuable consideration, and to
446	446	17 include any transfer, whether made for or without a valuable
447	447	18 consideration, for resale in any form as tangible personal
448	448	19 property unless made in compliance with Section 2c of this
449	449	20 Act.
450	450	21 Sales of tangible personal property, which property, to
451	451	22 the extent not first subjected to a use for which it was
452	452	23 purchased, as an ingredient or constituent, goes into and
453	453	24 forms a part of tangible personal property subsequently the
454	454	25 subject of a "Sale at retail", are not sales at retail as
455	455	26 defined in this Act: Provided that the property purchased is
456	456
457	457
458	458
459	459
460	460
461	461	HB4054 - 12 - LRB103 31848 HLH 60483 b
462	462
463	463
464	464	HB4054- 13 -LRB103 31848 HLH 60483 b HB4054 - 13 - LRB103 31848 HLH 60483 b
465	465	HB4054 - 13 - LRB103 31848 HLH 60483 b
466	466	1 deemed to be purchased for the purpose of resale, despite
467	467	2 first being used, to the extent to which it is resold as an
468	468	3 ingredient of an intentionally produced product or byproduct
469	469	4 of manufacturing.
470	470	5 "Sale at retail" shall be construed to include any
471	471	6 Illinois florist's sales transaction in which the purchase
472	472	7 order is received in Illinois by a florist and the sale is for
473	473	8 use or consumption, but the Illinois florist has a florist in
474	474	9 another state deliver the property to the purchaser or the
475	475	10 purchaser's donee in such other state.
476	476	11 Nonreusable tangible personal property that is used by
477	477	12 persons engaged in the business of operating a restaurant,
478	478	13 cafeteria, or drive-in is a sale for resale when it is
479	479	14 transferred to customers in the ordinary course of business as
480	480	15 part of the sale of food or beverages and is used to deliver,
481	481	16 package, or consume food or beverages, regardless of where
482	482	17 consumption of the food or beverages occurs. Examples of those
483	483	18 items include, but are not limited to nonreusable, paper and
484	484	19 plastic cups, plates, baskets, boxes, sleeves, buckets or
485	485	20 other containers, utensils, straws, placemats, napkins, doggie
486	486	21 bags, and wrapping or packaging materials that are transferred
487	487	22 to customers as part of the sale of food or beverages in the
488	488	23 ordinary course of business.
489	489	24 The purchase, employment and transfer of such tangible
490	490	25 personal property as newsprint and ink for the primary purpose
491	491	26 of conveying news (with or without other information) is not a
492	492
493	493
494	494
495	495
496	496
497	497	HB4054 - 13 - LRB103 31848 HLH 60483 b
498	498
499	499
500	500	HB4054- 14 -LRB103 31848 HLH 60483 b HB4054 - 14 - LRB103 31848 HLH 60483 b
501	501	HB4054 - 14 - LRB103 31848 HLH 60483 b
502	502	1 purchase, use or sale of tangible personal property.
503	503	2 A person whose activities are organized and conducted
504	504	3 primarily as a not-for-profit service enterprise, and who
505	505	4 engages in selling tangible personal property at retail
506	506	5 (whether to the public or merely to members and their guests)
507	507	6 is engaged in the business of selling tangible personal
508	508	7 property at retail with respect to such transactions,
509	509	8 excepting only a person organized and operated exclusively for
510	510	9 charitable, religious or educational purposes either (1), to
511	511	10 the extent of sales by such person to its members, students,
512	512	11 patients or inmates of tangible personal property to be used
513	513	12 primarily for the purposes of such person, or (2), to the
514	514	13 extent of sales by such person of tangible personal property
515	515	14 which is not sold or offered for sale by persons organized for
516	516	15 profit. The selling of school books and school supplies by
517	517	16 schools at retail to students is not "primarily for the
518	518	17 purposes of" the school which does such selling. The
519	519	18 provisions of this paragraph shall not apply to nor subject to
520	520	19 taxation occasional dinners, socials or similar activities of
521	521	20 a person organized and operated exclusively for charitable,
522	522	21 religious or educational purposes, whether or not such
523	523	22 activities are open to the public.
524	524	23 A person who is the recipient of a grant or contract under
525	525	24 Title VII of the Older Americans Act of 1965 (P.L. 92-258) and
526	526	25 serves meals to participants in the federal Nutrition Program
527	527	26 for the Elderly in return for contributions established in
528	528
529	529
530	530
531	531
532	532
533	533	HB4054 - 14 - LRB103 31848 HLH 60483 b
534	534
535	535
536	536	HB4054- 15 -LRB103 31848 HLH 60483 b HB4054 - 15 - LRB103 31848 HLH 60483 b
537	537	HB4054 - 15 - LRB103 31848 HLH 60483 b
538	538	1 amount by the individual participant pursuant to a schedule of
539	539	2 suggested fees as provided for in the federal Act is not
540	540	3 engaged in the business of selling tangible personal property
541	541	4 at retail with respect to such transactions.
542	542	5 "Purchaser" means anyone who, through a sale at retail,
543	543	6 acquires the ownership of or title to tangible personal
544	544	7 property for a valuable consideration.
545	545	8 "Reseller of motor fuel" means any person engaged in the
546	546	9 business of selling or delivering or transferring title of
547	547	10 motor fuel to another person other than for use or
548	548	11 consumption. No person shall act as a reseller of motor fuel
549	549	12 within this State without first being registered as a reseller
550	550	13 pursuant to Section 2c or a retailer pursuant to Section 2a.
551	551	14 "Selling price" or the "amount of sale" means the
552	552	15 consideration for a sale valued in money whether received in
553	553	16 money or otherwise, including cash, credits, property, other
554	554	17 than as hereinafter provided, and services, but, prior to
555	555	18 January 1, 2020 and beginning again on January 1, 2022, not
556	556	19 including the value of or credit given for traded-in tangible
557	557	20 personal property where the item that is traded-in is of like
558	558	21 kind and character as that which is being sold; beginning
559	559	22 January 1, 2020 and until January 1, 2022, "selling price"
560	560	23 includes the portion of the value of or credit given for
561	561	24 traded-in motor vehicles of the First Division as defined in
562	562	25 Section 1-146 of the Illinois Vehicle Code of like kind and
563	563	26 character as that which is being sold that exceeds $10,000.
564	564
565	565
566	566
567	567
568	568
569	569	HB4054 - 15 - LRB103 31848 HLH 60483 b
570	570
571	571
572	572	HB4054- 16 -LRB103 31848 HLH 60483 b HB4054 - 16 - LRB103 31848 HLH 60483 b
573	573	HB4054 - 16 - LRB103 31848 HLH 60483 b
574	574	1 "Selling price" shall be determined without any deduction on
575	575	2 account of the cost of the property sold, the cost of materials
576	576	3 used, labor or service cost or any other expense whatsoever,
577	577	4 but does not include charges that are added to prices by
578	578	5 sellers on account of the seller's tax liability under this
579	579	6 Act, or on account of the seller's duty to collect, from the
580	580	7 purchaser, the tax that is imposed by the Use Tax Act, or,
581	581	8 except as otherwise provided with respect to any cigarette tax
582	582	9 imposed by a home rule unit, on account of the seller's tax
583	583	10 liability under any local occupation tax administered by the
584	584	11 Department, or, except as otherwise provided with respect to
585	585	12 any cigarette tax imposed by a home rule unit on account of the
586	586	13 seller's duty to collect, from the purchasers, the tax that is
587	587	14 imposed under any local use tax administered by the
588	588	15 Department. Effective December 1, 1985, "selling price" shall
589	589	16 include charges that are added to prices by sellers on account
590	590	17 of the seller's tax liability under the Cigarette Tax Act, on
591	591	18 account of the sellers' duty to collect, from the purchaser,
592	592	19 the tax imposed under the Cigarette Use Tax Act, and on account
593	593	20 of the seller's duty to collect, from the purchaser, any
594	594	21 cigarette tax imposed by a home rule unit.
595	595	22 Notwithstanding any law to the contrary, for any motor
596	596	23 vehicle, as defined in Section 1-146 of the Vehicle Code, that
597	597	24 is sold on or after January 1, 2015 for the purpose of leasing
598	598	25 the vehicle for a defined period that is longer than one year
599	599	26 and (1) is a motor vehicle of the second division that: (A) is
600	600
601	601
602	602
603	603
604	604
605	605	HB4054 - 16 - LRB103 31848 HLH 60483 b
606	606
607	607
608	608	HB4054- 17 -LRB103 31848 HLH 60483 b HB4054 - 17 - LRB103 31848 HLH 60483 b
609	609	HB4054 - 17 - LRB103 31848 HLH 60483 b
610	610	1 a self-contained motor vehicle designed or permanently
611	611	2 converted to provide living quarters for recreational,
612	612	3 camping, or travel use, with direct walk through access to the
613	613	4 living quarters from the driver's seat; (B) is of the van
614	614	5 configuration designed for the transportation of not less than
615	615	6 7 nor more than 16 passengers; or (C) has a gross vehicle
616	616	7 weight rating of 8,000 pounds or less or (2) is a motor vehicle
617	617	8 of the first division, "selling price" or "amount of sale"
618	618	9 means the consideration received by the lessor pursuant to the
619	619	10 lease contract, including amounts due at lease signing and all
620	620	11 monthly or other regular payments charged over the term of the
621	621	12 lease. Also included in the selling price is any amount
622	622	13 received by the lessor from the lessee for the leased vehicle
623	623	14 that is not calculated at the time the lease is executed,
624	624	15 including, but not limited to, excess mileage charges and
625	625	16 charges for excess wear and tear. For sales that occur in
626	626	17 Illinois, with respect to any amount received by the lessor
627	627	18 from the lessee for the leased vehicle that is not calculated
628	628	19 at the time the lease is executed, the lessor who purchased the
629	629	20 motor vehicle does not incur the tax imposed by the Use Tax Act
630	630	21 on those amounts, and the retailer who makes the retail sale of
631	631	22 the motor vehicle to the lessor is not required to collect the
632	632	23 tax imposed by the Use Tax Act or to pay the tax imposed by
633	633	24 this Act on those amounts. However, the lessor who purchased
634	634	25 the motor vehicle assumes the liability for reporting and
635	635	26 paying the tax on those amounts directly to the Department in
636	636
637	637
638	638
639	639
640	640
641	641	HB4054 - 17 - LRB103 31848 HLH 60483 b
642	642
643	643
644	644	HB4054- 18 -LRB103 31848 HLH 60483 b HB4054 - 18 - LRB103 31848 HLH 60483 b
645	645	HB4054 - 18 - LRB103 31848 HLH 60483 b
646	646	1 the same form (Illinois Retailers' Occupation Tax, and local
647	647	2 retailers' occupation taxes, if applicable) in which the
648	648	3 retailer would have reported and paid such tax if the retailer
649	649	4 had accounted for the tax to the Department. For amounts
650	650	5 received by the lessor from the lessee that are not calculated
651	651	6 at the time the lease is executed, the lessor must file the
652	652	7 return and pay the tax to the Department by the due date
653	653	8 otherwise required by this Act for returns other than
654	654	9 transaction returns. If the retailer is entitled under this
655	655	10 Act to a discount for collecting and remitting the tax imposed
656	656	11 under this Act to the Department with respect to the sale of
657	657	12 the motor vehicle to the lessor, then the right to the discount
658	658	13 provided in this Act shall be transferred to the lessor with
659	659	14 respect to the tax paid by the lessor for any amount received
660	660	15 by the lessor from the lessee for the leased vehicle that is
661	661	16 not calculated at the time the lease is executed; provided
662	662	17 that the discount is only allowed if the return is timely filed
663	663	18 and for amounts timely paid. The "selling price" of a motor
664	664	19 vehicle that is sold on or after January 1, 2015 for the
665	665	20 purpose of leasing for a defined period of longer than one year
666	666	21 shall not be reduced by the value of or credit given for
667	667	22 traded-in tangible personal property owned by the lessor, nor
668	668	23 shall it be reduced by the value of or credit given for
669	669	24 traded-in tangible personal property owned by the lessee,
670	670	25 regardless of whether the trade-in value thereof is assigned
671	671	26 by the lessee to the lessor. In the case of a motor vehicle
672	672
673	673
674	674
675	675
676	676
677	677	HB4054 - 18 - LRB103 31848 HLH 60483 b
678	678
679	679
680	680	HB4054- 19 -LRB103 31848 HLH 60483 b HB4054 - 19 - LRB103 31848 HLH 60483 b
681	681	HB4054 - 19 - LRB103 31848 HLH 60483 b
682	682	1 that is sold for the purpose of leasing for a defined period of
683	683	2 longer than one year, the sale occurs at the time of the
684	684	3 delivery of the vehicle, regardless of the due date of any
685	685	4 lease payments. A lessor who incurs a Retailers' Occupation
686	686	5 Tax liability on the sale of a motor vehicle coming off lease
687	687	6 may not take a credit against that liability for the Use Tax
688	688	7 the lessor paid upon the purchase of the motor vehicle (or for
689	689	8 any tax the lessor paid with respect to any amount received by
690	690	9 the lessor from the lessee for the leased vehicle that was not
691	691	10 calculated at the time the lease was executed) if the selling
692	692	11 price of the motor vehicle at the time of purchase was
693	693	12 calculated using the definition of "selling price" as defined
694	694	13 in this paragraph. Notwithstanding any other provision of this
695	695	14 Act to the contrary, lessors shall file all returns and make
696	696	15 all payments required under this paragraph to the Department
697	697	16 by electronic means in the manner and form as required by the
698	698	17 Department. This paragraph does not apply to leases of motor
699	699	18 vehicles for which, at the time the lease is entered into, the
700	700	19 term of the lease is not a defined period, including leases
701	701	20 with a defined initial period with the option to continue the
702	702	21 lease on a month-to-month or other basis beyond the initial
703	703	22 defined period.
704	704	23 The phrase "like kind and character" shall be liberally
705	705	24 construed (including but not limited to any form of motor
706	706	25 vehicle for any form of motor vehicle, or any kind of farm or
707	707	26 agricultural implement for any other kind of farm or
708	708
709	709
710	710
711	711
712	712
713	713	HB4054 - 19 - LRB103 31848 HLH 60483 b
714	714
715	715
716	716	HB4054- 20 -LRB103 31848 HLH 60483 b HB4054 - 20 - LRB103 31848 HLH 60483 b
717	717	HB4054 - 20 - LRB103 31848 HLH 60483 b
718	718	1 agricultural implement), while not including a kind of item
719	719	2 which, if sold at retail by that retailer, would be exempt from
720	720	3 retailers' occupation tax and use tax as an isolated or
721	721	4 occasional sale.
722	722	5 "Gross receipts" from the sales of tangible personal
723	723	6 property at retail means the total selling price or the amount
724	724	7 of such sales, as hereinbefore defined. In the case of charge
725	725	8 and time sales, the amount thereof shall be included only as
726	726	9 and when payments are received by the seller. Receipts or
727	727	10 other consideration derived by a seller from the sale,
728	728	11 transfer or assignment of accounts receivable to a wholly
729	729	12 owned subsidiary will not be deemed payments prior to the time
730	730	13 the purchaser makes payment on such accounts.
731	731	14 "Department" means the Department of Revenue.
732	732	15 "Person" means any natural individual, firm, partnership,
733	733	16 association, joint stock company, joint adventure, public or
734	734	17 private corporation, limited liability company, or a receiver,
735	735	18 executor, trustee, guardian or other representative appointed
736	736	19 by order of any court.
737	737	20 The isolated or occasional sale of tangible personal
738	738	21 property at retail by a person who does not hold himself out as
739	739	22 being engaged (or who does not habitually engage) in selling
740	740	23 such tangible personal property at retail, or a sale through a
741	741	24 bulk vending machine, does not constitute engaging in a
742	742	25 business of selling such tangible personal property at retail
743	743	26 within the meaning of this Act; provided that any person who is
744	744
745	745
746	746
747	747
748	748
749	749	HB4054 - 20 - LRB103 31848 HLH 60483 b
750	750
751	751
752	752	HB4054- 21 -LRB103 31848 HLH 60483 b HB4054 - 21 - LRB103 31848 HLH 60483 b
753	753	HB4054 - 21 - LRB103 31848 HLH 60483 b
754	754	1 engaged in a business which is not subject to the tax imposed
755	755	2 by this Act because of involving the sale of or a contract to
756	756	3 sell real estate or a construction contract to improve real
757	757	4 estate or a construction contract to engineer, install, and
758	758	5 maintain an integrated system of products, but who, in the
759	759	6 course of conducting such business, transfers tangible
760	760	7 personal property to users or consumers in the finished form
761	761	8 in which it was purchased, and which does not become real
762	762	9 estate or was not engineered and installed, under any
763	763	10 provision of a construction contract or real estate sale or
764	764	11 real estate sales agreement entered into with some other
765	765	12 person arising out of or because of such nontaxable business,
766	766	13 is engaged in the business of selling tangible personal
767	767	14 property at retail to the extent of the value of the tangible
768	768	15 personal property so transferred. If, in such a transaction, a
769	769	16 separate charge is made for the tangible personal property so
770	770	17 transferred, the value of such property, for the purpose of
771	771	18 this Act, shall be the amount so separately charged, but not
772	772	19 less than the cost of such property to the transferor; if no
773	773	20 separate charge is made, the value of such property, for the
774	774	21 purposes of this Act, is the cost to the transferor of such
775	775	22 tangible personal property. Construction contracts for the
776	776	23 improvement of real estate consisting of engineering,
777	777	24 installation, and maintenance of voice, data, video, security,
778	778	25 and all telecommunication systems do not constitute engaging
779	779	26 in a business of selling tangible personal property at retail
780	780
781	781
782	782
783	783
784	784
785	785	HB4054 - 21 - LRB103 31848 HLH 60483 b
786	786
787	787
788	788	HB4054- 22 -LRB103 31848 HLH 60483 b HB4054 - 22 - LRB103 31848 HLH 60483 b
789	789	HB4054 - 22 - LRB103 31848 HLH 60483 b
790	790	1 within the meaning of this Act if they are sold at one
791	791	2 specified contract price.
792	792	3 A person who holds himself or herself out as being engaged
793	793	4 (or who habitually engages) in selling tangible personal
794	794	5 property at retail is a person engaged in the business of
795	795	6 selling tangible personal property at retail hereunder with
796	796	7 respect to such sales (and not primarily in a service
797	797	8 occupation) notwithstanding the fact that such person designs
798	798	9 and produces such tangible personal property on special order
799	799	10 for the purchaser and in such a way as to render the property
800	800	11 of value only to such purchaser, if such tangible personal
801	801	12 property so produced on special order serves substantially the
802	802	13 same function as stock or standard items of tangible personal
803	803	14 property that are sold at retail.
804	804	15 Persons who engage in the business of transferring
805	805	16 tangible personal property upon the redemption of trading
806	806	17 stamps are engaged in the business of selling such property at
807	807	18 retail and shall be liable for and shall pay the tax imposed by
808	808	19 this Act on the basis of the retail value of the property
809	809	20 transferred upon redemption of such stamps.
810	810	21 "Bulk vending machine" means a vending machine, containing
811	811	22 unsorted confections, nuts, toys, or other items designed
812	812	23 primarily to be used or played with by children which, when a
813	813	24 coin or coins of a denomination not larger than $0.50 are
814	814	25 inserted, are dispensed in equal portions, at random and
815	815	26 without selection by the customer.
816	816
817	817
818	818
819	819
820	820
821	821	HB4054 - 22 - LRB103 31848 HLH 60483 b
822	822
823	823
824	824	HB4054- 23 -LRB103 31848 HLH 60483 b HB4054 - 23 - LRB103 31848 HLH 60483 b
825	825	HB4054 - 23 - LRB103 31848 HLH 60483 b
826	826	1 "Remote retailer" means a retailer that does not maintain
827	827	2 within this State, directly or by a subsidiary, an office,
828	828	3 distribution house, sales house, warehouse or other place of
829	829	4 business, or any agent or other representative operating
830	830	5 within this State under the authority of the retailer or its
831	831	6 subsidiary, irrespective of whether such place of business or
832	832	7 agent is located here permanently or temporarily or whether
833	833	8 such retailer or subsidiary is licensed to do business in this
834	834	9 State.
835	835	10 "Marketplace" means a physical or electronic place, forum,
836	836	11 platform, application, or other method by which a marketplace
837	837	12 seller sells or offers to sell items.
838	838	13 "Marketplace facilitator" means a person who, pursuant to
839	839	14 an agreement with an unrelated third-party marketplace seller,
840	840	15 directly or indirectly through one or more affiliates
841	841	16 facilitates a retail sale by an unrelated third party
842	842	17 marketplace seller by:
843	843	18 (1) listing or advertising for sale by the marketplace
844	844	19 seller in a marketplace, tangible personal property that
845	845	20 is subject to tax under this Act; and
846	846	21 (2) either directly or indirectly, through agreements
847	847	22 or arrangements with third parties, collecting payment
848	848	23 from the customer and transmitting that payment to the
849	849	24 marketplace seller regardless of whether the marketplace
850	850	25 facilitator receives compensation or other consideration
851	851	26 in exchange for its services.
852	852
853	853
854	854
855	855
856	856
857	857	HB4054 - 23 - LRB103 31848 HLH 60483 b
858	858
859	859
860	860	HB4054- 24 -LRB103 31848 HLH 60483 b HB4054 - 24 - LRB103 31848 HLH 60483 b
861	861	HB4054 - 24 - LRB103 31848 HLH 60483 b
862	862	1 A person who provides advertising services, including
863	863	2 listing products for sale, is not considered a marketplace
864	864	3 facilitator, so long as the advertising service platform or
865	865	4 forum does not engage, directly or indirectly through one or
866	866	5 more affiliated persons, in the activities described in
867	867	6 paragraph (2) of this definition of "marketplace facilitator".
868	868	7 "Marketplace facilitator" does not include any person
869	869	8 licensed under the Auction License Act. This exemption does
870	870	9 not apply to any person who is an Internet auction listing
871	871	10 service, as defined by the Auction License Act.
872	872	11 "Marketplace facilitator" does not include a delivery
873	873	12 network company that delivers tangible personal property on
874	874	13 behalf of a marketplace seller that is engaged in business as a
875	875	14 retail vendor.
876	876	15 "Delivery network company" means a business that
877	877	16 facilitates, through the use of an Internet website or mobile
878	878	17 application, the delivery of local products.
879	879	18 "Local product" means any item, including food, other than
880	880	19 freight, mail, or a package to which postage has been affixed.
881	881	20 "Marketplace seller" means a person that makes sales
882	882	21 through a marketplace operated by an unrelated third party
883	883	22 marketplace facilitator.
884	884	23 (Source: P.A. 101-31, eff. 6-28-19; 101-604, eff. 1-1-20;
885	885	24 102-353, eff. 1-1-22; 102-634, eff. 8-27-21; 102-813, eff.
886	886	25 5-13-22.)
887	887	26 Section 99. Effective date. This Act takes effect upon
888	888
889	889
890	890
891	891
892	892
893	893	HB4054 - 24 - LRB103 31848 HLH 60483 b
894	894
895	895
896	896	HB4054- 25 -LRB103 31848 HLH 60483 b HB4054 - 25 - LRB103 31848 HLH 60483 b
897	897	HB4054 - 25 - LRB103 31848 HLH 60483 b
898	898	1 becoming law.
899	899
900	900
901	901
902	902
903	903
904	904	HB4054 - 25 - LRB103 31848 HLH 60483 b