103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB5583
 
Introduced , by Rep. Hoan Huynh
 
SYNOPSIS AS INTRODUCED:

35 ILCS 105/3-10
35 ILCS 110/3-10 from Ch. 120, par. 439.33-10
35 ILCS 115/3-10 from Ch. 120, par. 439.103-10
35 ILCS 120/2-10
 Amends the Use Tax Act, the Service Use Tax Act, the Service Occupation Tax Act, and the Retailers' Occupation Tax Act. Provides that, beginning on January 1, 2025
, with respect to firearms, the taxes under those Acts are imposed at the rate of 11%. Effective immediately.


LRB103 38110 HLH 68242 b


 
 
A BILL FOR
 
HB5583LRB103 38110 HLH 68242 b


1 AN ACT concerning revenue.

2 Be it enacted by the People of the State of Illinois, 
3represented in the General Assembly:

4 Section 5. The Use Tax Act is amended by changing Section 
53-10 as follows:

6 (35 ILCS 105/3-10)
7 Sec. 3-10. Rate of tax. Unless otherwise provided in this 
8Section, the tax imposed by this Act is at the rate of 6.25% of 
9either the selling price or the fair market value, if any, of 
10the tangible personal property. In all cases where property 
11functionally used or consumed is the same as the property that 
12was purchased at retail, then the tax is imposed on the selling 
13price of the property. In all cases where property 
14functionally used or consumed is a by-product or waste product 
15that has been refined, manufactured, or produced from property 
16purchased at retail, then the tax is imposed on the lower of 
17the fair market value, if any, of the specific property so used 
18in this State or on the selling price of the property purchased 
19at retail. For purposes of this Section "fair market value" 
20means the price at which property would change hands between a 
21willing buyer and a willing seller, neither being under any 
22compulsion to buy or sell and both having reasonable knowledge 
23of the relevant facts. The fair market value shall be 
 
 
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1established by Illinois sales by the taxpayer of the same 
2property as that functionally used or consumed, or if there 
3are no such sales by the taxpayer, then comparable sales or 
4purchases of property of like kind and character in Illinois.
5 Beginning on July 1, 2000 and through December 31, 2000, 
6with respect to motor fuel, as defined in Section 1.1 of the 
7Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of 
8the Use Tax Act, the tax is imposed at the rate of 1.25%.
9 Beginning on August 6, 2010 through August 15, 2010, and 
10beginning again on August 5, 2022 through August 14, 2022, 
11with respect to sales tax holiday items as defined in Section 
123-6 of this Act, the tax is imposed at the rate of 1.25%. 
13 With respect to gasohol, the tax imposed by this Act 
14applies to (i) 70% of the proceeds of sales made on or after 
15January 1, 1990, and before July 1, 2003, (ii) 80% of the 
16proceeds of sales made on or after July 1, 2003 and on or 
17before July 1, 2017, (iii) 100% of the proceeds of sales made 
18after July 1, 2017 and prior to January 1, 2024, (iv) 90% of 
19the proceeds of sales made on or after January 1, 2024 and on 
20or before December 31, 2028, and (v) 100% of the proceeds of 
21sales made after December 31, 2028. If, at any time, however, 
22the tax under this Act on sales of gasohol is imposed at the 
23rate of 1.25%, then the tax imposed by this Act applies to 100% 
24of the proceeds of sales of gasohol made during that time.
25 With respect to mid-range ethanol blends, the tax imposed 
26by this Act applies to (i) 80% of the proceeds of sales made on 
 
 
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1or after January 1, 2024 and on or before December 31, 2028 and 
2(ii) 100% of the proceeds of sales made thereafter. If, at any 
3time, however, the tax under this Act on sales of mid-range 
4ethanol blends is imposed at the rate of 1.25%, then the tax 
5imposed by this Act applies to 100% of the proceeds of sales of 
6mid-range ethanol blends made during that time. 
7 With respect to majority blended ethanol fuel, the tax 
8imposed by this Act does not apply to the proceeds of sales 
9made on or after July 1, 2003 and on or before December 31, 
102028 but applies to 100% of the proceeds of sales made 
11thereafter.
12 With respect to biodiesel blends with no less than 1% and 
13no more than 10% biodiesel, the tax imposed by this Act applies 
14to (i) 80% of the proceeds of sales made on or after July 1, 
152003 and on or before December 31, 2018 and (ii) 100% of the 
16proceeds of sales made after December 31, 2018 and before 
17January 1, 2024. On and after January 1, 2024 and on or before 
18December 31, 2030, the taxation of biodiesel, renewable 
19diesel, and biodiesel blends shall be as provided in Section 
203-5.1. If, at any time, however, the tax under this Act on 
21sales of biodiesel blends with no less than 1% and no more than 
2210% biodiesel is imposed at the rate of 1.25%, then the tax 
23imposed by this Act applies to 100% of the proceeds of sales of 
24biodiesel blends with no less than 1% and no more than 10% 
25biodiesel made during that time.
26 With respect to biodiesel and biodiesel blends with more 
 
 
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1than 10% but no more than 99% biodiesel, the tax imposed by 
2this Act does not apply to the proceeds of sales made on or 
3after July 1, 2003 and on or before December 31, 2023. On and 
4after January 1, 2024 and on or before December 31, 2030, the 
5taxation of biodiesel, renewable diesel, and biodiesel blends 
6shall be as provided in Section 3-5.1.
7 Until July 1, 2022 and beginning again on July 1, 2023, 
8with respect to food for human consumption that is to be 
9consumed off the premises where it is sold (other than 
10alcoholic beverages, food consisting of or infused with adult 
11use cannabis, soft drinks, and food that has been prepared for 
12immediate consumption), the tax is imposed at the rate of 1%. 
13Beginning on July 1, 2022 and until July 1, 2023, with respect 
14to food for human consumption that is to be consumed off the 
15premises where it is sold (other than alcoholic beverages, 
16food consisting of or infused with adult use cannabis, soft 
17drinks, and food that has been prepared for immediate 
18consumption), the tax is imposed at the rate of 0%.
19 With respect to prescription and nonprescription 
20medicines, drugs, medical appliances, products classified as 
21Class III medical devices by the United States Food and Drug 
22Administration that are used for cancer treatment pursuant to 
23a prescription, as well as any accessories and components 
24related to those devices, modifications to a motor vehicle for 
25the purpose of rendering it usable by a person with a 
26disability, and insulin, blood sugar testing materials, 
 
 
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1syringes, and needles used by human diabetics, the tax is 
2imposed at the rate of 1%. For the purposes of this Section, 
3until September 1, 2009: the term "soft drinks" means any 
4complete, finished, ready-to-use, non-alcoholic drink, whether 
5carbonated or not, including, but not limited to, soda water, 
6cola, fruit juice, vegetable juice, carbonated water, and all 
7other preparations commonly known as soft drinks of whatever 
8kind or description that are contained in any closed or sealed 
9bottle, can, carton, or container, regardless of size; but 
10"soft drinks" does not include coffee, tea, non-carbonated 
11water, infant formula, milk or milk products as defined in the 
12Grade A Pasteurized Milk and Milk Products Act, or drinks 
13containing 50% or more natural fruit or vegetable juice.
14 Notwithstanding any other provisions of this Act, 
15beginning September 1, 2009, "soft drinks" means non-alcoholic 
16beverages that contain natural or artificial sweeteners. "Soft 
17drinks" does not include beverages that contain milk or milk 
18products, soy, rice or similar milk substitutes, or greater 
19than 50% of vegetable or fruit juice by volume.
20 Until August 1, 2009, and notwithstanding any other 
21provisions of this Act, "food for human consumption that is to 
22be consumed off the premises where it is sold" includes all 
23food sold through a vending machine, except soft drinks and 
24food products that are dispensed hot from a vending machine, 
25regardless of the location of the vending machine. Beginning 
26August 1, 2009, and notwithstanding any other provisions of 
 
 
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1this Act, "food for human consumption that is to be consumed 
2off the premises where it is sold" includes all food sold 
3through a vending machine, except soft drinks, candy, and food 
4products that are dispensed hot from a vending machine, 
5regardless of the location of the vending machine. 
6 Notwithstanding any other provisions of this Act, 
7beginning September 1, 2009, "food for human consumption that 
8is to be consumed off the premises where it is sold" does not 
9include candy. For purposes of this Section, "candy" means a 
10preparation of sugar, honey, or other natural or artificial 
11sweeteners in combination with chocolate, fruits, nuts or 
12other ingredients or flavorings in the form of bars, drops, or 
13pieces. "Candy" does not include any preparation that contains 
14flour or requires refrigeration. 
15 Notwithstanding any other provisions of this Act, 
16beginning September 1, 2009, "nonprescription medicines and 
17drugs" does not include grooming and hygiene products. For 
18purposes of this Section, "grooming and hygiene products" 
19includes, but is not limited to, soaps and cleaning solutions, 
20shampoo, toothpaste, mouthwash, antiperspirants, and sun tan 
21lotions and screens, unless those products are available by 
22prescription only, regardless of whether the products meet the 
23definition of "over-the-counter-drugs". For the purposes of 
24this paragraph, "over-the-counter-drug" means a drug for human 
25use that contains a label that identifies the product as a drug 
26as required by 21 CFR 201.66. The "over-the-counter-drug" 
 
 
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1label includes: 
2  (A) a "Drug Facts" panel; or
3  (B) a statement of the "active ingredient(s)" with a 
4 list of those ingredients contained in the compound, 
5 substance or preparation.
6 Beginning on January 1, 2014 (the effective date of Public 
7Act 98-122), "prescription and nonprescription medicines and 
8drugs" includes medical cannabis purchased from a registered 
9dispensing organization under the Compassionate Use of Medical 
10Cannabis Program Act. 
11 As used in this Section, "adult use cannabis" means 
12cannabis subject to tax under the Cannabis Cultivation 
13Privilege Tax Law and the Cannabis Purchaser Excise Tax Law 
14and does not include cannabis subject to tax under the 
15Compassionate Use of Medical Cannabis Program Act. 
16 If the property that is purchased at retail from a 
17retailer is acquired outside Illinois and used outside 
18Illinois before being brought to Illinois for use here and is 
19taxable under this Act, the "selling price" on which the tax is 
20computed shall be reduced by an amount that represents a 
21reasonable allowance for depreciation for the period of prior 
22out-of-state use.
23 Beginning on January 1, 2025, with respect to firearms, 
24the tax is imposed at the rate of 11%. 
25(Source: P.A. 102-4, eff. 4-27-21; 102-700, Article 20, 
26Section 20-5, eff. 4-19-22; 102-700, Article 60, Section 
 
 
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160-15, eff. 4-19-22; 102-700, Article 65, Section 65-5, eff. 
24-19-22; 103-9, eff. 6-7-23; 103-154 eff. 6-30-23.)

3 Section 10. The Service Use Tax Act is amended by changing 
4Section 3-10 as follows:

5 (35 ILCS 110/3-10) (from Ch. 120, par. 439.33-10)
6 Sec. 3-10. Rate of tax. Unless otherwise provided in this 
7Section, the tax imposed by this Act is at the rate of 6.25% of 
8the selling price of tangible personal property transferred as 
9an incident to the sale of service, but, for the purpose of 
10computing this tax, in no event shall the selling price be less 
11than the cost price of the property to the serviceman.
12 Beginning on July 1, 2000 and through December 31, 2000, 
13with respect to motor fuel, as defined in Section 1.1 of the 
14Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of 
15the Use Tax Act, the tax is imposed at the rate of 1.25%.
16 With respect to gasohol, as defined in the Use Tax Act, the 
17tax imposed by this Act applies to (i) 70% of the selling price 
18of property transferred as an incident to the sale of service 
19on or after January 1, 1990, and before July 1, 2003, (ii) 80% 
20of the selling price of property transferred as an incident to 
21the sale of service on or after July 1, 2003 and on or before 
22July 1, 2017, (iii) 100% of the selling price of property 
23transferred as an incident to the sale of service after July 1, 
242017 and before January 1, 2024, (iv) 90% of the selling price 
 
 
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1of property transferred as an incident to the sale of service 
2on or after January 1, 2024 and on or before December 31, 2028, 
3and (v) 100% of the selling price of property transferred as an 
4incident to the sale of service after December 31, 2028. If, at 
5any time, however, the tax under this Act on sales of gasohol, 
6as defined in the Use Tax Act, is imposed at the rate of 1.25%, 
7then the tax imposed by this Act applies to 100% of the 
8proceeds of sales of gasohol made during that time.
9 With respect to mid-range ethanol blends, as defined in 
10Section 3-44.3 of the Use Tax Act, the tax imposed by this Act 
11applies to (i) 80% of the selling price of property 
12transferred as an incident to the sale of service on or after 
13January 1, 2024 and on or before December 31, 2028 and (ii) 
14100% of the selling price of property transferred as an 
15incident to the sale of service after December 31, 2028. If, at 
16any time, however, the tax under this Act on sales of mid-range 
17ethanol blends is imposed at the rate of 1.25%, then the tax 
18imposed by this Act applies to 100% of the selling price of 
19mid-range ethanol blends transferred as an incident to the 
20sale of service during that time.
21 With respect to majority blended ethanol fuel, as defined 
22in the Use Tax Act, the tax imposed by this Act does not apply 
23to the selling price of property transferred as an incident to 
24the sale of service on or after July 1, 2003 and on or before 
25December 31, 2028 but applies to 100% of the selling price 
26thereafter.
 
 
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1 With respect to biodiesel blends, as defined in the Use 
2Tax Act, with no less than 1% and no more than 10% biodiesel, 
3the tax imposed by this Act applies to (i) 80% of the selling 
4price of property transferred as an incident to the sale of 
5service on or after July 1, 2003 and on or before December 31, 
62018 and (ii) 100% of the proceeds of the selling price after 
7December 31, 2018 and before January 1, 2024. On and after 
8January 1, 2024 and on or before December 31, 2030, the 
9taxation of biodiesel, renewable diesel, and biodiesel blends 
10shall be as provided in Section 3-5.1 of the Use Tax Act. If, 
11at any time, however, the tax under this Act on sales of 
12biodiesel blends, as defined in the Use Tax Act, with no less 
13than 1% and no more than 10% biodiesel is imposed at the rate 
14of 1.25%, then the tax imposed by this Act applies to 100% of 
15the proceeds of sales of biodiesel blends with no less than 1% 
16and no more than 10% biodiesel made during that time.
17 With respect to biodiesel, as defined in the Use Tax Act, 
18and biodiesel blends, as defined in the Use Tax Act, with more 
19than 10% but no more than 99% biodiesel, the tax imposed by 
20this Act does not apply to the proceeds of the selling price of 
21property transferred as an incident to the sale of service on 
22or after July 1, 2003 and on or before December 31, 2023. On 
23and after January 1, 2024 and on or before December 31, 2030, 
24the taxation of biodiesel, renewable diesel, and biodiesel 
25blends shall be as provided in Section 3-5.1 of the Use Tax 
26Act.
 
 
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1 At the election of any registered serviceman made for each 
2fiscal year, sales of service in which the aggregate annual 
3cost price of tangible personal property transferred as an 
4incident to the sales of service is less than 35%, or 75% in 
5the case of servicemen transferring prescription drugs or 
6servicemen engaged in graphic arts production, of the 
7aggregate annual total gross receipts from all sales of 
8service, the tax imposed by this Act shall be based on the 
9serviceman's cost price of the tangible personal property 
10transferred as an incident to the sale of those services.
11 Until July 1, 2022 and beginning again on July 1, 2023, the 
12tax shall be imposed at the rate of 1% on food prepared for 
13immediate consumption and transferred incident to a sale of 
14service subject to this Act or the Service Occupation Tax Act 
15by an entity licensed under the Hospital Licensing Act, the 
16Nursing Home Care Act, the Assisted Living and Shared Housing 
17Act, the ID/DD Community Care Act, the MC/DD Act, the 
18Specialized Mental Health Rehabilitation Act of 2013, or the 
19Child Care Act of 1969, or an entity that holds a permit issued 
20pursuant to the Life Care Facilities Act. Until July 1, 2022 
21and beginning again on July 1, 2023, the tax shall also be 
22imposed at the rate of 1% on food for human consumption that is 
23to be consumed off the premises where it is sold (other than 
24alcoholic beverages, food consisting of or infused with adult 
25use cannabis, soft drinks, and food that has been prepared for 
26immediate consumption and is not otherwise included in this 
 
 
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1paragraph). 
2 Beginning on July 1, 2022 and until July 1, 2023, the tax 
3shall be imposed at the rate of 0% on food prepared for 
4immediate consumption and transferred incident to a sale of 
5service subject to this Act or the Service Occupation Tax Act 
6by an entity licensed under the Hospital Licensing Act, the 
7Nursing Home Care Act, the Assisted Living and Shared Housing 
8Act, the ID/DD Community Care Act, the MC/DD Act, the 
9Specialized Mental Health Rehabilitation Act of 2013, or the 
10Child Care Act of 1969, or an entity that holds a permit issued 
11pursuant to the Life Care Facilities Act. Beginning on July 1, 
122022 and until July 1, 2023, the tax shall also be imposed at 
13the rate of 0% on food for human consumption that is to be 
14consumed off the premises where it is sold (other than 
15alcoholic beverages, food consisting of or infused with adult 
16use cannabis, soft drinks, and food that has been prepared for 
17immediate consumption and is not otherwise included in this 
18paragraph). 
19 The tax shall also be imposed at the rate of 1% on 
20prescription and nonprescription medicines, drugs, medical 
21appliances, products classified as Class III medical devices 
22by the United States Food and Drug Administration that are 
23used for cancer treatment pursuant to a prescription, as well 
24as any accessories and components related to those devices, 
25modifications to a motor vehicle for the purpose of rendering 
26it usable by a person with a disability, and insulin, blood 
 
 
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1sugar testing materials, syringes, and needles used by human 
2diabetics. For the purposes of this Section, until September 
31, 2009: the term "soft drinks" means any complete, finished, 
4ready-to-use, non-alcoholic drink, whether carbonated or not, 
5including, but not limited to, soda water, cola, fruit juice, 
6vegetable juice, carbonated water, and all other preparations 
7commonly known as soft drinks of whatever kind or description 
8that are contained in any closed or sealed bottle, can, 
9carton, or container, regardless of size; but "soft drinks" 
10does not include coffee, tea, non-carbonated water, infant 
11formula, milk or milk products as defined in the Grade A 
12Pasteurized Milk and Milk Products Act, or drinks containing 
1350% or more natural fruit or vegetable juice.
14 Notwithstanding any other provisions of this Act, 
15beginning September 1, 2009, "soft drinks" means non-alcoholic 
16beverages that contain natural or artificial sweeteners. "Soft 
17drinks" does not include beverages that contain milk or milk 
18products, soy, rice or similar milk substitutes, or greater 
19than 50% of vegetable or fruit juice by volume.
20 Until August 1, 2009, and notwithstanding any other 
21provisions of this Act, "food for human consumption that is to 
22be consumed off the premises where it is sold" includes all 
23food sold through a vending machine, except soft drinks and 
24food products that are dispensed hot from a vending machine, 
25regardless of the location of the vending machine. Beginning 
26August 1, 2009, and notwithstanding any other provisions of 
 
 
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1this Act, "food for human consumption that is to be consumed 
2off the premises where it is sold" includes all food sold 
3through a vending machine, except soft drinks, candy, and food 
4products that are dispensed hot from a vending machine, 
5regardless of the location of the vending machine. 
6 Notwithstanding any other provisions of this Act, 
7beginning September 1, 2009, "food for human consumption that 
8is to be consumed off the premises where it is sold" does not 
9include candy. For purposes of this Section, "candy" means a 
10preparation of sugar, honey, or other natural or artificial 
11sweeteners in combination with chocolate, fruits, nuts or 
12other ingredients or flavorings in the form of bars, drops, or 
13pieces. "Candy" does not include any preparation that contains 
14flour or requires refrigeration. 
15 Notwithstanding any other provisions of this Act, 
16beginning September 1, 2009, "nonprescription medicines and 
17drugs" does not include grooming and hygiene products. For 
18purposes of this Section, "grooming and hygiene products" 
19includes, but is not limited to, soaps and cleaning solutions, 
20shampoo, toothpaste, mouthwash, antiperspirants, and sun tan 
21lotions and screens, unless those products are available by 
22prescription only, regardless of whether the products meet the 
23definition of "over-the-counter-drugs". For the purposes of 
24this paragraph, "over-the-counter-drug" means a drug for human 
25use that contains a label that identifies the product as a drug 
26as required by 21 CFR 201.66. The "over-the-counter-drug" 
 
 
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1label includes: 
2  (A) a "Drug Facts" panel; or
3  (B) a statement of the "active ingredient(s)" with a 
4 list of those ingredients contained in the compound, 
5 substance or preparation.
6 Beginning on January 1, 2014 (the effective date of Public 
7Act 98-122), "prescription and nonprescription medicines and 
8drugs" includes medical cannabis purchased from a registered 
9dispensing organization under the Compassionate Use of Medical 
10Cannabis Program Act. 
11 As used in this Section, "adult use cannabis" means 
12cannabis subject to tax under the Cannabis Cultivation 
13Privilege Tax Law and the Cannabis Purchaser Excise Tax Law 
14and does not include cannabis subject to tax under the 
15Compassionate Use of Medical Cannabis Program Act. 
16 Beginning on January 1, 2025, with respect to firearms, 
17the tax is imposed at the rate of 11%. 
18 If the property that is acquired from a serviceman is 
19acquired outside Illinois and used outside Illinois before 
20being brought to Illinois for use here and is taxable under 
21this Act, the "selling price" on which the tax is computed 
22shall be reduced by an amount that represents a reasonable 
23allowance for depreciation for the period of prior 
24out-of-state use.
25(Source: P.A. 102-4, eff. 4-27-21; 102-16, eff. 6-17-21; 
26102-700, Article 20, Section 20-10, eff. 4-19-22; 102-700, 
 
 
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1Article 60, Section 60-20, eff. 4-19-22; 103-9, eff. 6-7-23; 
2103-154, eff. 6-30-23.)

3 Section 15. The Service Occupation Tax Act is amended by 
4changing Section 3-10 as follows:

5 (35 ILCS 115/3-10) (from Ch. 120, par. 439.103-10)
6 Sec. 3-10. Rate of tax. Unless otherwise provided in this 
7Section, the tax imposed by this Act is at the rate of 6.25% of 
8the "selling price", as defined in Section 2 of the Service Use 
9Tax Act, of the tangible personal property. For the purpose of 
10computing this tax, in no event shall the "selling price" be 
11less than the cost price to the serviceman of the tangible 
12personal property transferred. The selling price of each item 
13of tangible personal property transferred as an incident of a 
14sale of service may be shown as a distinct and separate item on 
15the serviceman's billing to the service customer. If the 
16selling price is not so shown, the selling price of the 
17tangible personal property is deemed to be 50% of the 
18serviceman's entire billing to the service customer. When, 
19however, a serviceman contracts to design, develop, and 
20produce special order machinery or equipment, the tax imposed 
21by this Act shall be based on the serviceman's cost price of 
22the tangible personal property transferred incident to the 
23completion of the contract.
24 Beginning on July 1, 2000 and through December 31, 2000, 
 
 
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1with respect to motor fuel, as defined in Section 1.1 of the 
2Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of 
3the Use Tax Act, the tax is imposed at the rate of 1.25%.
4 With respect to gasohol, as defined in the Use Tax Act, the 
5tax imposed by this Act shall apply to (i) 70% of the cost 
6price of property transferred as an incident to the sale of 
7service on or after January 1, 1990, and before July 1, 2003, 
8(ii) 80% of the selling price of property transferred as an 
9incident to the sale of service on or after July 1, 2003 and on 
10or before July 1, 2017, (iii) 100% of the selling price of 
11property transferred as an incident to the sale of service 
12after July 1, 2017 and prior to January 1, 2024, (iv) 90% of 
13the selling price of property transferred as an incident to 
14the sale of service on or after January 1, 2024 and on or 
15before December 31, 2028, and (v) 100% of the selling price of 
16property transferred as an incident to the sale of service 
17after December 31, 2028. If, at any time, however, the tax 
18under this Act on sales of gasohol, as defined in the Use Tax 
19Act, is imposed at the rate of 1.25%, then the tax imposed by 
20this Act applies to 100% of the proceeds of sales of gasohol 
21made during that time.
22 With respect to mid-range ethanol blends, as defined in 
23Section 3-44.3 of the Use Tax Act, the tax imposed by this Act 
24applies to (i) 80% of the selling price of property 
25transferred as an incident to the sale of service on or after 
26January 1, 2024 and on or before December 31, 2028 and (ii) 
 
 
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1100% of the selling price of property transferred as an 
2incident to the sale of service after December 31, 2028. If, at 
3any time, however, the tax under this Act on sales of mid-range 
4ethanol blends is imposed at the rate of 1.25%, then the tax 
5imposed by this Act applies to 100% of the selling price of 
6mid-range ethanol blends transferred as an incident to the 
7sale of service during that time. 
8 With respect to majority blended ethanol fuel, as defined 
9in the Use Tax Act, the tax imposed by this Act does not apply 
10to the selling price of property transferred as an incident to 
11the sale of service on or after July 1, 2003 and on or before 
12December 31, 2028 but applies to 100% of the selling price 
13thereafter.
14 With respect to biodiesel blends, as defined in the Use 
15Tax Act, with no less than 1% and no more than 10% biodiesel, 
16the tax imposed by this Act applies to (i) 80% of the selling 
17price of property transferred as an incident to the sale of 
18service on or after July 1, 2003 and on or before December 31, 
192018 and (ii) 100% of the proceeds of the selling price after 
20December 31, 2018 and before January 1, 2024. On and after 
21January 1, 2024 and on or before December 31, 2030, the 
22taxation of biodiesel, renewable diesel, and biodiesel blends 
23shall be as provided in Section 3-5.1 of the Use Tax Act. If, 
24at any time, however, the tax under this Act on sales of 
25biodiesel blends, as defined in the Use Tax Act, with no less 
26than 1% and no more than 10% biodiesel is imposed at the rate 
 
 
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1of 1.25%, then the tax imposed by this Act applies to 100% of 
2the proceeds of sales of biodiesel blends with no less than 1% 
3and no more than 10% biodiesel made during that time.
4 With respect to biodiesel, as defined in the Use Tax Act, 
5and biodiesel blends, as defined in the Use Tax Act, with more 
6than 10% but no more than 99% biodiesel material, the tax 
7imposed by this Act does not apply to the proceeds of the 
8selling price of property transferred as an incident to the 
9sale of service on or after July 1, 2003 and on or before 
10December 31, 2023. On and after January 1, 2024 and on or 
11before December 31, 2030, the taxation of biodiesel, renewable 
12diesel, and biodiesel blends shall be as provided in Section 
133-5.1 of the Use Tax Act.
14 At the election of any registered serviceman made for each 
15fiscal year, sales of service in which the aggregate annual 
16cost price of tangible personal property transferred as an 
17incident to the sales of service is less than 35%, or 75% in 
18the case of servicemen transferring prescription drugs or 
19servicemen engaged in graphic arts production, of the 
20aggregate annual total gross receipts from all sales of 
21service, the tax imposed by this Act shall be based on the 
22serviceman's cost price of the tangible personal property 
23transferred incident to the sale of those services.
24 Until July 1, 2022 and beginning again on July 1, 2023, the 
25tax shall be imposed at the rate of 1% on food prepared for 
26immediate consumption and transferred incident to a sale of 
 
 
HB5583- 20 -LRB103 38110 HLH 68242 b


1service subject to this Act or the Service Use Tax Act by an 
2entity licensed under the Hospital Licensing Act, the Nursing 
3Home Care Act, the Assisted Living and Shared Housing Act, the 
4ID/DD Community Care Act, the MC/DD Act, the Specialized 
5Mental Health Rehabilitation Act of 2013, or the Child Care 
6Act of 1969, or an entity that holds a permit issued pursuant 
7to the Life Care Facilities Act. Until July 1, 2022 and 
8beginning again on July 1, 2023, the tax shall also be imposed 
9at the rate of 1% on food for human consumption that is to be 
10consumed off the premises where it is sold (other than 
11alcoholic beverages, food consisting of or infused with adult 
12use cannabis, soft drinks, and food that has been prepared for 
13immediate consumption and is not otherwise included in this 
14paragraph).
15 Beginning on July 1, 2022 and until July 1, 2023, the tax 
16shall be imposed at the rate of 0% on food prepared for 
17immediate consumption and transferred incident to a sale of 
18service subject to this Act or the Service Use Tax Act by an 
19entity licensed under the Hospital Licensing Act, the Nursing 
20Home Care Act, the Assisted Living and Shared Housing Act, the 
21ID/DD Community Care Act, the MC/DD Act, the Specialized 
22Mental Health Rehabilitation Act of 2013, or the Child Care 
23Act of 1969, or an entity that holds a permit issued pursuant 
24to the Life Care Facilities Act. Beginning July 1, 2022 and 
25until July 1, 2023, the tax shall also be imposed at the rate 
26of 0% on food for human consumption that is to be consumed off 
 
 
HB5583- 21 -LRB103 38110 HLH 68242 b


1the premises where it is sold (other than alcoholic beverages, 
2food consisting of or infused with adult use cannabis, soft 
3drinks, and food that has been prepared for immediate 
4consumption and is not otherwise included in this paragraph). 
5 The tax shall also be imposed at the rate of 1% on 
6prescription and nonprescription medicines, drugs, medical 
7appliances, products classified as Class III medical devices 
8by the United States Food and Drug Administration that are 
9used for cancer treatment pursuant to a prescription, as well 
10as any accessories and components related to those devices, 
11modifications to a motor vehicle for the purpose of rendering 
12it usable by a person with a disability, and insulin, blood 
13sugar testing materials, syringes, and needles used by human 
14diabetics. For the purposes of this Section, until September 
151, 2009: the term "soft drinks" means any complete, finished, 
16ready-to-use, non-alcoholic drink, whether carbonated or not, 
17including, but not limited to, soda water, cola, fruit juice, 
18vegetable juice, carbonated water, and all other preparations 
19commonly known as soft drinks of whatever kind or description 
20that are contained in any closed or sealed can, carton, or 
21container, regardless of size; but "soft drinks" does not 
22include coffee, tea, non-carbonated water, infant formula, 
23milk or milk products as defined in the Grade A Pasteurized 
24Milk and Milk Products Act, or drinks containing 50% or more 
25natural fruit or vegetable juice.
26 Notwithstanding any other provisions of this Act, 
 
 
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1beginning September 1, 2009, "soft drinks" means non-alcoholic 
2beverages that contain natural or artificial sweeteners. "Soft 
3drinks" does not include beverages that contain milk or milk 
4products, soy, rice or similar milk substitutes, or greater 
5than 50% of vegetable or fruit juice by volume.
6 Until August 1, 2009, and notwithstanding any other 
7provisions of this Act, "food for human consumption that is to 
8be consumed off the premises where it is sold" includes all 
9food sold through a vending machine, except soft drinks and 
10food products that are dispensed hot from a vending machine, 
11regardless of the location of the vending machine. Beginning 
12August 1, 2009, and notwithstanding any other provisions of 
13this Act, "food for human consumption that is to be consumed 
14off the premises where it is sold" includes all food sold 
15through a vending machine, except soft drinks, candy, and food 
16products that are dispensed hot from a vending machine, 
17regardless of the location of the vending machine. 
18 Notwithstanding any other provisions of this Act, 
19beginning September 1, 2009, "food for human consumption that 
20is to be consumed off the premises where it is sold" does not 
21include candy. For purposes of this Section, "candy" means a 
22preparation of sugar, honey, or other natural or artificial 
23sweeteners in combination with chocolate, fruits, nuts or 
24other ingredients or flavorings in the form of bars, drops, or 
25pieces. "Candy" does not include any preparation that contains 
26flour or requires refrigeration. 
 
 
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1 Notwithstanding any other provisions of this Act, 
2beginning September 1, 2009, "nonprescription medicines and 
3drugs" does not include grooming and hygiene products. For 
4purposes of this Section, "grooming and hygiene products" 
5includes, but is not limited to, soaps and cleaning solutions, 
6shampoo, toothpaste, mouthwash, antiperspirants, and sun tan 
7lotions and screens, unless those products are available by 
8prescription only, regardless of whether the products meet the 
9definition of "over-the-counter-drugs". For the purposes of 
10this paragraph, "over-the-counter-drug" means a drug for human 
11use that contains a label that identifies the product as a drug 
12as required by 21 CFR 201.66. The "over-the-counter-drug" 
13label includes: 
14  (A) a "Drug Facts" panel; or
15  (B) a statement of the "active ingredient(s)" with a 
16 list of those ingredients contained in the compound, 
17 substance or preparation.
18 Beginning on January 1, 2014 (the effective date of Public 
19Act 98-122), "prescription and nonprescription medicines and 
20drugs" includes medical cannabis purchased from a registered 
21dispensing organization under the Compassionate Use of Medical 
22Cannabis Program Act. 
23 As used in this Section, "adult use cannabis" means 
24cannabis subject to tax under the Cannabis Cultivation 
25Privilege Tax Law and the Cannabis Purchaser Excise Tax Law 
26and does not include cannabis subject to tax under the 
 
 
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1Compassionate Use of Medical Cannabis Program Act. 
2 Beginning on January 1, 2025, with respect to firearms, 
3the tax is imposed at the rate of 11%. 
4(Source: P.A. 102-4, eff. 4-27-21; 102-16, eff. 6-17-21; 
5102-700, Article 20, Section 20-15, eff. 4-19-22; 102-700, 
6Article 60, Section 60-25, eff. 4-19-22; 103-9, eff. 6-7-23; 
7103-154, eff. 6-30-23.)

8 Section 20. The Retailers' Occupation Tax Act is amended 
9by changing Section 2-10 as follows:

10 (35 ILCS 120/2-10)
11 Sec. 2-10. Rate of tax. Unless otherwise provided in this 
12Section, the tax imposed by this Act is at the rate of 6.25% of 
13gross receipts from sales of tangible personal property made 
14in the course of business.
15 Beginning on July 1, 2000 and through December 31, 2000, 
16with respect to motor fuel, as defined in Section 1.1 of the 
17Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of 
18the Use Tax Act, the tax is imposed at the rate of 1.25%.
19 Beginning on August 6, 2010 through August 15, 2010, and 
20beginning again on August 5, 2022 through August 14, 2022, 
21with respect to sales tax holiday items as defined in Section 
222-8 of this Act, the tax is imposed at the rate of 1.25%. 
23 Within 14 days after July 1, 2000 (the effective date of 
24Public Act 91-872), each retailer of motor fuel and gasohol 
 
 
HB5583- 25 -LRB103 38110 HLH 68242 b


1shall cause the following notice to be posted in a prominently 
2visible place on each retail dispensing device that is used to 
3dispense motor fuel or gasohol in the State of Illinois: "As of 
4July 1, 2000, the State of Illinois has eliminated the State's 
5share of sales tax on motor fuel and gasohol through December 
631, 2000. The price on this pump should reflect the 
7elimination of the tax." The notice shall be printed in bold 
8print on a sign that is no smaller than 4 inches by 8 inches. 
9The sign shall be clearly visible to customers. Any retailer 
10who fails to post or maintain a required sign through December 
1131, 2000 is guilty of a petty offense for which the fine shall 
12be $500 per day per each retail premises where a violation 
13occurs.
14 With respect to gasohol, as defined in the Use Tax Act, the 
15tax imposed by this Act applies to (i) 70% of the proceeds of 
16sales made on or after January 1, 1990, and before July 1, 
172003, (ii) 80% of the proceeds of sales made on or after July 
181, 2003 and on or before July 1, 2017, (iii) 100% of the 
19proceeds of sales made after July 1, 2017 and prior to January 
201, 2024, (iv) 90% of the proceeds of sales made on or after 
21January 1, 2024 and on or before December 31, 2028, and (v) 
22100% of the proceeds of sales made after December 31, 2028. If, 
23at any time, however, the tax under this Act on sales of 
24gasohol, as defined in the Use Tax Act, is imposed at the rate 
25of 1.25%, then the tax imposed by this Act applies to 100% of 
26the proceeds of sales of gasohol made during that time.
 
 
HB5583- 26 -LRB103 38110 HLH 68242 b


1 With respect to mid-range ethanol blends, as defined in 
2Section 3-44.3 of the Use Tax Act, the tax imposed by this Act 
3applies to (i) 80% of the proceeds of sales made on or after 
4January 1, 2024 and on or before December 31, 2028 and (ii) 
5100% of the proceeds of sales made after December 31, 2028. If, 
6at any time, however, the tax under this Act on sales of 
7mid-range ethanol blends is imposed at the rate of 1.25%, then 
8the tax imposed by this Act applies to 100% of the proceeds of 
9sales of mid-range ethanol blends made during that time. 
10 With respect to majority blended ethanol fuel, as defined 
11in the Use Tax Act, the tax imposed by this Act does not apply 
12to the proceeds of sales made on or after July 1, 2003 and on 
13or before December 31, 2028 but applies to 100% of the proceeds 
14of sales made thereafter.
15 With respect to biodiesel blends, as defined in the Use 
16Tax Act, with no less than 1% and no more than 10% biodiesel, 
17the tax imposed by this Act applies to (i) 80% of the proceeds 
18of sales made on or after July 1, 2003 and on or before 
19December 31, 2018 and (ii) 100% of the proceeds of sales made 
20after December 31, 2018 and before January 1, 2024. On and 
21after January 1, 2024 and on or before December 31, 2030, the 
22taxation of biodiesel, renewable diesel, and biodiesel blends 
23shall be as provided in Section 3-5.1 of the Use Tax Act. If, 
24at any time, however, the tax under this Act on sales of 
25biodiesel blends, as defined in the Use Tax Act, with no less 
26than 1% and no more than 10% biodiesel is imposed at the rate 
 
 
HB5583- 27 -LRB103 38110 HLH 68242 b


1of 1.25%, then the tax imposed by this Act applies to 100% of 
2the proceeds of sales of biodiesel blends with no less than 1% 
3and no more than 10% biodiesel made during that time.
4 With respect to biodiesel, as defined in the Use Tax Act, 
5and biodiesel blends, as defined in the Use Tax Act, with more 
6than 10% but no more than 99% biodiesel, the tax imposed by 
7this Act does not apply to the proceeds of sales made on or 
8after July 1, 2003 and on or before December 31, 2023. On and 
9after January 1, 2024 and on or before December 31, 2030, the 
10taxation of biodiesel, renewable diesel, and biodiesel blends 
11shall be as provided in Section 3-5.1 of the Use Tax Act. 
12 Until July 1, 2022 and beginning again on July 1, 2023, 
13with respect to food for human consumption that is to be 
14consumed off the premises where it is sold (other than 
15alcoholic beverages, food consisting of or infused with adult 
16use cannabis, soft drinks, and food that has been prepared for 
17immediate consumption), the tax is imposed at the rate of 1%. 
18Beginning July 1, 2022 and until July 1, 2023, with respect to 
19food for human consumption that is to be consumed off the 
20premises where it is sold (other than alcoholic beverages, 
21food consisting of or infused with adult use cannabis, soft 
22drinks, and food that has been prepared for immediate 
23consumption), the tax is imposed at the rate of 0%. 
24 With respect to prescription and nonprescription 
25medicines, drugs, medical appliances, products classified as 
26Class III medical devices by the United States Food and Drug 
 
 
HB5583- 28 -LRB103 38110 HLH 68242 b


1Administration that are used for cancer treatment pursuant to 
2a prescription, as well as any accessories and components 
3related to those devices, modifications to a motor vehicle for 
4the purpose of rendering it usable by a person with a 
5disability, and insulin, blood sugar testing materials, 
6syringes, and needles used by human diabetics, the tax is 
7imposed at the rate of 1%. For the purposes of this Section, 
8until September 1, 2009: the term "soft drinks" means any 
9complete, finished, ready-to-use, non-alcoholic drink, whether 
10carbonated or not, including, but not limited to, soda water, 
11cola, fruit juice, vegetable juice, carbonated water, and all 
12other preparations commonly known as soft drinks of whatever 
13kind or description that are contained in any closed or sealed 
14bottle, can, carton, or container, regardless of size; but 
15"soft drinks" does not include coffee, tea, non-carbonated 
16water, infant formula, milk or milk products as defined in the 
17Grade A Pasteurized Milk and Milk Products Act, or drinks 
18containing 50% or more natural fruit or vegetable juice.
19 Notwithstanding any other provisions of this Act, 
20beginning September 1, 2009, "soft drinks" means non-alcoholic 
21beverages that contain natural or artificial sweeteners. "Soft 
22drinks" does not include beverages that contain milk or milk 
23products, soy, rice or similar milk substitutes, or greater 
24than 50% of vegetable or fruit juice by volume.
25 Until August 1, 2009, and notwithstanding any other 
26provisions of this Act, "food for human consumption that is to 
 
 
HB5583- 29 -LRB103 38110 HLH 68242 b


1be consumed off the premises where it is sold" includes all 
2food sold through a vending machine, except soft drinks and 
3food products that are dispensed hot from a vending machine, 
4regardless of the location of the vending machine. Beginning 
5August 1, 2009, and notwithstanding any other provisions of 
6this Act, "food for human consumption that is to be consumed 
7off the premises where it is sold" includes all food sold 
8through a vending machine, except soft drinks, candy, and food 
9products that are dispensed hot from a vending machine, 
10regardless of the location of the vending machine. 
11 Notwithstanding any other provisions of this Act, 
12beginning September 1, 2009, "food for human consumption that 
13is to be consumed off the premises where it is sold" does not 
14include candy. For purposes of this Section, "candy" means a 
15preparation of sugar, honey, or other natural or artificial 
16sweeteners in combination with chocolate, fruits, nuts or 
17other ingredients or flavorings in the form of bars, drops, or 
18pieces. "Candy" does not include any preparation that contains 
19flour or requires refrigeration. 
20 Notwithstanding any other provisions of this Act, 
21beginning September 1, 2009, "nonprescription medicines and 
22drugs" does not include grooming and hygiene products. For 
23purposes of this Section, "grooming and hygiene products" 
24includes, but is not limited to, soaps and cleaning solutions, 
25shampoo, toothpaste, mouthwash, antiperspirants, and sun tan 
26lotions and screens, unless those products are available by 
 
 
HB5583- 30 -LRB103 38110 HLH 68242 b


1prescription only, regardless of whether the products meet the 
2definition of "over-the-counter-drugs". For the purposes of 
3this paragraph, "over-the-counter-drug" means a drug for human 
4use that contains a label that identifies the product as a drug 
5as required by 21 CFR 201.66. The "over-the-counter-drug" 
6label includes: 
7  (A) a "Drug Facts" panel; or
8  (B) a statement of the "active ingredient(s)" with a 
9 list of those ingredients contained in the compound, 
10 substance or preparation.
11 Beginning on January 1, 2014 (the effective date of Public 
12Act 98-122), "prescription and nonprescription medicines and 
13drugs" includes medical cannabis purchased from a registered 
14dispensing organization under the Compassionate Use of Medical 
15Cannabis Program Act. 
16 As used in this Section, "adult use cannabis" means 
17cannabis subject to tax under the Cannabis Cultivation 
18Privilege Tax Law and the Cannabis Purchaser Excise Tax Law 
19and does not include cannabis subject to tax under the 
20Compassionate Use of Medical Cannabis Program Act. 
21 Beginning on January 1, 2025, with respect to firearms, 
22the tax is imposed at the rate of 11%. 
23(Source: P.A. 102-4, eff. 4-27-21; 102-700, Article 20, 
24Section 20-20, eff. 4-19-22; 102-700, Article 60, Section 
2560-30, eff. 4-19-22; 102-700, Article 65, Section 65-10, eff. 
264-19-22; 103-9, eff. 6-7-23; 103-154, eff. 6-30-23.)

 
 
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