HB 403 — USE/OCC TX-WATER SUPPLY EXEMPT

(18) Beginning with taxable years ending on or after December 31, 1995 and ending with taxable years ending on or before December 31, 2004, personal property that is used in the performance of infrastructure repairs in this State, including but not limited to municipal roads and streets, access roads, bridges, sidewalks, waste disposal systems, water and sewer line extensions, water distribution and purification facilities, storm water drainage and retention facilities, and sewage treatment facilities, resulting from a State or federally declared disaster in Illinois or bordering Illinois HB0403 Engrossed - 23 - LRB095 04179 BDD 24217 b when such repairs are initiated on facilities located in the declared disaster area within 6 months after the disaster.

HB0403 - 23 - LRB095 04179 BDD 24217 b (19) Beginning July 1, 1999, game or game birds purchased at a "game breeding and hunting preserve area" or an "exotic game hunting area" as those terms are used in the Wildlife Code or at a hunting enclosure approved through rules adopted by the Department of Natural Resources.

HB0403 Engrossed - 24 - LRB095 04179 BDD 24217 b (21) Beginning January 1, 2000, personal property, including food, purchased through fundraising events for the HB0403 - 24 - LRB095 04179 BDD 24217 b benefit of a public or private elementary or secondary school, a group of those schools, or one or more school districts if the events are sponsored by an entity recognized by the school district that consists primarily of volunteers and includes parents and teachers of the school children.

(23) Beginning August 23, 2001 and through June 30, 2011, food for human consumption that is to be consumed off the HB0403 Engrossed - 25 - LRB095 04179 BDD 24217 b premises where it is sold (other than alcoholic beverages, soft drinks, and food that has been prepared for immediate HB0403 - 25 - LRB095 04179 BDD 24217 b consumption) and prescription and nonprescription medicines, drugs, medical appliances, and insulin, urine testing materials, syringes, and needles used by diabetics, for human use, when purchased for use by a person receiving medical assistance under Article 5 of the Illinois Public Aid Code who resides in a licensed long-term care facility, as defined in the Nursing Home Care Act.

No lessor shall collect or attempt to collect an amount (however designated) that purports to reimburse that lessor for the tax imposed by this Act or the HB0403 Engrossed - 26 - LRB095 04179 BDD 24217 b Use Tax Act, as the case may be, if the tax has not been paid by the lessor.

If a lessor improperly collects any such amount HB0403 - 26 - LRB095 04179 BDD 24217 b from the lessee, the lessee shall have a legal right to claim a refund of that amount from the lessor.

If, however, that amount HB0403 Engrossed - 27 - LRB095 04179 BDD 24217 b is not refunded to the lessee for any reason, the lessor is liable to pay that amount to the Department.

This paragraph is HB0403 - 27 - LRB095 04179 BDD 24217 b exempt from the provisions of Section 3-75.

(26) Beginning January 1, 2008, tangible personal property used in the construction, maintenance, or operation of a public water supply, as defined under Section 3.365 of the Environmental Protection Act, that is operated by a not-for-profit entity.

(26) Beginning January 1, 2008, tangible personal property used in the construction, maintenance, or operation of a community water supply, as defined under Section 3.145 of the Environmental Protection Act, that is operated by a not-for-profit corporation that holds a valid water supply permit issued under Title IV of the Environmental Protection Act.

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

(1) Personal property sold by a corporation, society, association, foundation, institution, or organization, other than a limited liability company, that is organized and operated as a not-for-profit service enterprise for the benefit of persons 65 years of age or older if the personal property was not purchased by the enterprise for the purpose of resale HB0403 Engrossed - 28 - LRB095 04179 BDD 24217 b by the enterprise.

HB0403 - 28 - LRB095 04179 BDD 24217 b (3) Personal property purchased by any not-for-profit arts or cultural organization that establishes, by proof required by the Department by rule, that it has received an exemption under Section 501(c)(3) of the Internal Revenue Code and that is organized and operated primarily for the presentation or support of arts or cultural programming, activities, or services.

(5) Until July 1, 2003 and beginning again on September 1, 2004, graphic arts machinery and equipment, including repair and replacement parts, both new and used, and including that HB0403 Engrossed - 29 - LRB095 04179 BDD 24217 b manufactured on special order or purchased for lease, certified by the purchaser to be used primarily for graphic arts production.

Equipment includes chemicals or chemicals acting as catalysts but only if the chemicals or chemicals acting as HB0403 - 29 - LRB095 04179 BDD 24217 b catalysts effect a direct and immediate change upon a graphic arts product.

Agricultural chemical tender tanks and dry boxes shall include units sold separately from a motor vehicle required to be licensed and units sold mounted on a motor HB0403 Engrossed - 30 - LRB095 04179 BDD 24217 b vehicle required to be licensed if the selling price of the tender is separately stated.

Farm machinery and equipment shall include precision farming equipment that is installed or purchased to be HB0403 - 30 - LRB095 04179 BDD 24217 b installed on farm machinery and equipment including, but not limited to, tractors, harvesters, sprayers, planters, seeders, or spreaders.

(9) Proceeds of mandatory service charges separately HB0403 Engrossed - 31 - LRB095 04179 BDD 24217 b stated on customers’ bills for the purchase and consumption of food and beverages, to the extent that the proceeds of the service charge are in fact turned over as tips or as a substitute for tips to the employees who participate directly HB0403 - 31 - LRB095 04179 BDD 24217 b in preparing, serving, hosting or cleaning up the food or beverage function with respect to which the service charge is imposed.

(12) Until July 1, 2003, coal exploration, mining, offhighway hauling, processing, maintenance, and reclamation equipment, including replacement parts and equipment, and including equipment purchased for lease, but excluding motor vehicles required to be registered under the Illinois Vehicle HB0403 Engrossed - 32 - LRB095 04179 BDD 24217 b Code.

(13) Beginning January 1, 1992 and through June 30, 2011, food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, soft HB0403 - 32 - LRB095 04179 BDD 24217 b drinks and food that has been prepared for immediate consumption) and prescription and non-prescription medicines, drugs, medical appliances, and insulin, urine testing materials, syringes, and needles used by diabetics, for human use, when purchased for use by a person receiving medical assistance under Article 5 of the Illinois Public Aid Code who resides in a licensed long-term care facility, as defined in the Nursing Home Care Act.

(16) Computers and communications equipment utilized for any hospital purpose and equipment used in the diagnosis, analysis, or treatment of hospital patients sold to a lessor who leases the equipment, under a lease of one year or longer executed or in effect at the time of the purchase, to a hospital that has been issued an active tax exemption HB0403 Engrossed - 33 - LRB095 04179 BDD 24217 b identification number by the Department under Section 1g of the Retailers’ Occupation Tax Act.

(17) Personal property sold to a lessor who leases the property, under a lease of one year or longer executed or in HB0403 - 33 - LRB095 04179 BDD 24217 b effect at the time of the purchase, to a governmental body that has been issued an active tax exemption identification number by the Department under Section 1g of the Retailers’ Occupation Tax Act.

(19) Beginning with taxable years ending on or after December 31, 1995 and ending with taxable years ending on or before December 31, 2004, personal property that is used in the performance of infrastructure repairs in this State, including but not limited to municipal roads and streets, access roads, bridges, sidewalks, waste disposal systems, water and sewer line extensions, water distribution and purification facilities, storm water drainage and retention facilities, and HB0403 Engrossed - 34 - LRB095 04179 BDD 24217 b sewage treatment facilities, resulting from a State or federally declared disaster in Illinois or bordering Illinois when such repairs are initiated on facilities located in the declared disaster area within 6 months after the disaster.

HB0403 - 34 - LRB095 04179 BDD 24217 b (20) Beginning July 1, 1999, game or game birds sold at a "game breeding and hunting preserve area" or an "exotic game hunting area" as those terms are used in the Wildlife Code or at a hunting enclosure approved through rules adopted by the Department of Natural Resources.

For purposes of this exemption, "a corporation, limited liability company, society, association, foundation, or institution organized and operated exclusively for educational purposes" means all tax-supported public schools, private schools that offer systematic instruction in useful branches of learning by methods common to public schools and that compare favorably in their scope and intensity with the course of study presented in tax-supported schools, and vocational or technical schools or institutes organized and operated exclusively to provide a course of study of not less than 6 weeks duration and designed to prepare individuals to HB0403 Engrossed - 35 - LRB095 04179 BDD 24217 b follow a trade or to pursue a manual, technical, mechanical, industrial, business, or commercial occupation.

(22) Beginning January 1, 2000, personal property, including food, purchased through fundraising events for the HB0403 - 35 - LRB095 04179 BDD 24217 b benefit of a public or private elementary or secondary school, a group of those schools, or one or more school districts if the events are sponsored by an entity recognized by the school district that consists primarily of volunteers and includes parents and teachers of the school children.

HB0403 Engrossed - 36 - LRB095 04179 BDD 24217 b (24) Beginning on the effective date of this amendatory Act of the 92nd General Assembly, computers and communications equipment utilized for any hospital purpose and equipment used in the diagnosis, analysis, or treatment of hospital patients HB0403 - 36 - LRB095 04179 BDD 24217 b sold to a lessor who leases the equipment, under a lease of one year or longer executed or in effect at the time of the purchase, to a hospital that has been issued an active tax exemption identification number by the Department under Section 1g of the Retailers’ Occupation Tax Act.

(26) Beginning on January 1, 2002 and through June 30, 2011, tangible personal property purchased from an Illinois retailer by a taxpayer engaged in centralized purchasing activities in Illinois who will, upon receipt of the property in Illinois, temporarily store the property in Illinois (i) for the purpose of subsequently transporting it outside this State for use or consumption thereafter solely outside this State or (ii) for the purpose of being processed, fabricated, or HB0403 Engrossed - 37 - LRB095 04179 BDD 24217 b manufactured into, attached to, or incorporated into other tangible personal property to be transported outside this State and thereafter used or consumed solely outside this State.

The Director of Revenue shall, pursuant to rules adopted in HB0403 - 37 - LRB095 04179 BDD 24217 b accordance with the Illinois Administrative Procedure Act, issue a permit to any taxpayer in good standing with the Department who is eligible for the exemption under this paragraph (26).

(27) Beginning January 1, 2008, tangible personal property used in the construction, maintenance, or operation of a publiccommunity water supply, as defined under Section 3.3653.145 of the Environmental Protection Act, that is operated by a not-for-profit entity.corporation that holds a valid water supply permit issued under Title IV of the Environmental Protection Act.

7-3-06.) HB0403 Engrossed - 38 - LRB095 04179 BDD 24217 b Section 20.

Gross receipts from proceeds from the sale of the following tangible personal property are exempt HB0403 - 38 - LRB095 04179 BDD 24217 b from the tax imposed by this Act:

Agricultural chemical tender tanks and dry boxes shall include units sold separately from a motor vehicle required to be licensed and units sold mounted on a motor vehicle required to be licensed, if the selling price of the HB0403 Engrossed - 39 - LRB095 04179 BDD 24217 b tender is separately stated.

Precision farming equipment includes, but is not HB0403 - 39 - LRB095 04179 BDD 24217 b limited to, soil testing sensors, computers, monitors, software, global positioning and mapping systems, and other such equipment.

(4) Until July 1, 2003 and beginning again September 1, 2004, graphic arts machinery and equipment, including repair and replacement parts, both new and used, and including that HB0403 Engrossed - 40 - LRB095 04179 BDD 24217 b manufactured on special order or purchased for lease, certified by the purchaser to be used primarily for graphic arts production.

HB0403 - 40 - LRB095 04179 BDD 24217 b (5) A motor vehicle of the first division, a motor vehicle of the second division that is a self-contained motor vehicle designed or permanently converted to provide living quarters for recreational, camping, or travel use, with direct walk through access to the living quarters from the driver’s seat, or a motor vehicle of the second division that is of the van configuration designed for the transportation of not less than 7 nor more than 16 passengers, as defined in Section 1-146 of the Illinois Vehicle Code, that is used for automobile renting, as defined in the Automobile Renting Occupation and Use Tax Act.

HB0403 Engrossed - 41 - LRB095 04179 BDD 24217 b (9) Personal property sold to a not-for-profit arts or cultural organization that establishes, by proof required by the Department by rule, that it has received an exemption under Section 501(c)(3) of the Internal Revenue Code and that is organized and operated primarily for the presentation or support of arts or cultural programming, activities, or HB0403 - 41 - LRB095 04179 BDD 24217 b services.

(11) Personal property sold to a governmental body, to a corporation, society, association, foundation, or institution organized and operated exclusively for charitable, religious, or educational purposes, or to a not-for-profit corporation, HB0403 Engrossed - 42 - LRB095 04179 BDD 24217 b society, association, foundation, institution, or organization that has no compensated officers or employees and that is organized and operated primarily for the recreation of persons 55 years of age or older.

A limited liability company may qualify for the exemption under this paragraph only if the limited liability company is organized and operated HB0403 - 42 - LRB095 04179 BDD 24217 b exclusively for educational purposes.

(i) with a gross vehicle weight rating HB0403 Engrossed - 43 - LRB095 04179 BDD 24217 b in excess of 8,000 pounds;

Through June 30, 2005, this exemption applies to repair and replacement parts added after the initial purchase of such a motor vehicle if that motor vehicle is used HB0403 - 43 - LRB095 04179 BDD 24217 b in a manner that would qualify for the rolling stock exemption otherwise provided for in this Act.

(14) Machinery and equipment that will be used by the purchaser, or a lessee of the purchaser, primarily in the process of manufacturing or assembling tangible personal property for wholesale or retail sale or lease, whether the sale or lease is made directly by the manufacturer or by some other person, whether the materials used in the process are owned by the manufacturer or some other person, or whether the sale or lease is made apart from or as an incident to the HB0403 Engrossed - 44 - LRB095 04179 BDD 24217 b seller’s engaging in the service occupation of producing machines, tools, dies, jigs, patterns, gauges, or other similar items of no commercial value on special order for a particular purchaser.

(15) Proceeds of mandatory service charges separately stated on customers’ bills for purchase and consumption of food HB0403 - 44 - LRB095 04179 BDD 24217 b and beverages, to the extent that the proceeds of the service charge are in fact turned over as tips or as a substitute for tips to the employees who participate directly in preparing, serving, hosting or cleaning up the food or beverage function with respect to which the service charge is imposed.

HB0403 Engrossed - 45 - LRB095 04179 BDD 24217 b (19) Until July 1 2003, oil field exploration, drilling, and production equipment, including (i) rigs and parts of rigs, rotary rigs, cable tool rigs, and workover rigs, (ii) pipe and tubular goods, including casing and drill strings, (iii) pumps and pump-jack units, (iv) storage tanks and flow lines, (v) any individual replacement part for oil field exploration, HB0403 - 45 - LRB095 04179 BDD 24217 b drilling, and production equipment, and (vi) machinery and equipment purchased for lease;

HB0403 Engrossed - 46 - LRB095 04179 BDD 24217 b (23) A transaction in which the purchase order is received by a florist who is located outside Illinois, but who has a florist located in Illinois deliver the property to the purchaser or the purchaser’s donee in Illinois.

(24) Fuel consumed or used in the operation of ships, barges, or vessels that are used primarily in or for the HB0403 - 46 - LRB095 04179 BDD 24217 b transportation of property or the conveyance of persons for hire on rivers bordering on this State if the fuel is delivered by the seller to the purchaser’s barge, ship, or vessel while it is afloat upon that bordering river.

HB0403 Engrossed - 47 - LRB095 04179 BDD 24217 b The tax collected under this Act on the sale of a motor vehicle in this State to a resident of another state that does not allow a reciprocal exemption shall be imposed at a rate equal to the state’s rate of tax on taxable property in the state in which the purchaser is a resident, except that the tax shall not exceed the tax that would otherwise be imposed under this HB0403 - 47 - LRB095 04179 BDD 24217 b Act.

HB0403 Engrossed - 48 - LRB095 04179 BDD 24217 b (27) Horses, or interests in horses, registered with and meeting the requirements of any of the Arabian Horse Club Registry of America, Appaloosa Horse Club, American Quarter Horse Association, United States Trotting Association, or Jockey Club, as appropriate, used for purposes of breeding or racing for prizes.

HB0403 - 48 - LRB095 04179 BDD 24217 b (28) Computers and communications equipment utilized for any hospital purpose and equipment used in the diagnosis, analysis, or treatment of hospital patients sold to a lessor who leases the equipment, under a lease of one year or longer executed or in effect at the time of the purchase, to a hospital that has been issued an active tax exemption identification number by the Department under Section 1g of this Act.

(30) Beginning with taxable years ending on or after December 31, 1995 and ending with taxable years ending on or before December 31, 2004, personal property that is donated for disaster relief to be used in a State or federally declared disaster area in Illinois or bordering Illinois by a manufacturer or retailer that is registered in this State to a corporation, society, association, foundation, or institution HB0403 Engrossed - 49 - LRB095 04179 BDD 24217 b that has been issued a sales tax exemption identification number by the Department that assists victims of the disaster who reside within the declared disaster area.

(31) Beginning with taxable years ending on or after December 31, 1995 and ending with taxable years ending on or before December 31, 2004, personal property that is used in the HB0403 - 49 - LRB095 04179 BDD 24217 b performance of infrastructure repairs in this State, including but not limited to municipal roads and streets, access roads, bridges, sidewalks, waste disposal systems, water and sewer line extensions, water distribution and purification facilities, storm water drainage and retention facilities, and sewage treatment facilities, resulting from a State or federally declared disaster in Illinois or bordering Illinois when such repairs are initiated on facilities located in the declared disaster area within 6 months after the disaster.

(33) A motor vehicle, as that term is defined in Section 1-146 of the Illinois Vehicle Code, that is donated to a corporation, limited liability company, society, association, foundation, or institution that is determined by the Department to be organized and operated exclusively for educational HB0403 Engrossed - 50 - LRB095 04179 BDD 24217 b purposes.

For purposes of this exemption, "a corporation, limited liability company, society, association, foundation, or institution organized and operated exclusively for educational purposes" means all tax-supported public schools, private schools that offer systematic instruction in useful branches of learning by methods common to public schools and HB0403 - 50 - LRB095 04179 BDD 24217 b that compare favorably in their scope and intensity with the course of study presented in tax-supported schools, and vocational or technical schools or institutes organized and operated exclusively to provide a course of study of not less than 6 weeks duration and designed to prepare individuals to follow a trade or to pursue a manual, technical, mechanical, industrial, business, or commercial occupation.

This paragraph is HB0403 Engrossed - 51 - LRB095 04179 BDD 24217 b exempt from the provisions of Section 2-70.

Beginning January 1, 2002 and through June 30, 2003, machines and parts HB0403 - 51 - LRB095 04179 BDD 24217 b for machines used in commercial, coin-operated amusement and vending business if a use or occupation tax is paid on the gross receipts derived from the use of the commercial, coin-operated amusement and vending machines.

(36) Beginning August 2, 2001, computers and communications equipment utilized for any hospital purpose and equipment used in the diagnosis, analysis, or treatment of hospital patients sold to a lessor who leases the equipment, HB0403 Engrossed - 52 - LRB095 04179 BDD 24217 b under a lease of one year or longer executed or in effect at the time of the purchase, to a hospital that has been issued an active tax exemption identification number by the Department under Section 1g of this Act.

(37) Beginning August 2, 2001, personal property sold to a HB0403 - 52 - LRB095 04179 BDD 24217 b lessor who leases the property, under a lease of one year or longer executed or in effect at the time of the purchase, to a governmental body that has been issued an active tax exemption identification number by the Department under Section 1g of this Act.

The Director of Revenue shall, pursuant to rules adopted in accordance with the Illinois Administrative Procedure Act, issue a permit to any taxpayer in good standing with the HB0403 Engrossed - 53 - LRB095 04179 BDD 24217 b Department who is eligible for the exemption under this paragraph (38).

Taxpayers shall maintain all HB0403 - 53 - LRB095 04179 BDD 24217 b necessary books and records to substantiate the use and consumption of all such tangible personal property outside of the State of Illinois.

(39) Beginning January 1, 2008, tangible personal property used in the construction, maintenance, or operation of a publiccommunity water supply, as defined under Section 3.3653.145 of the Environmental Protection Act, that is operated by a not-for-profit entity.corporation that holds a valid water supply permit issued under Title IV of the Environmental Protection Act.