|
March 2, 2018
State and Local Tax this week
Illinois General Assembly
The House and Senate returned to Springfield on February 27 and were in session through Thursday
.
The House is scheduled to be in session next week Tuesday through Thursday. The Senate is not in session next week. The Senate returns to Springfield on March 13.
The Senate Revenue committee held a hearing on Tuesday February 28. The committee considered a number of bills including
SB 2577. As amended, SB 2577 a
mends the Use Tax Act and the Service Use Tax Act and provides that, if a retailer or serviceman makes a sale to purchaser in Illinois from outside of Illinois, then that retailer or serviceman is considered to be "maintaining a place of business in this State" if (1) the cumulative gross receipts from sales of service to purchasers in Illinois are $100,000 or more; or (2) the retailer or serviceman enters into 200 or more separate transactions for sales of service to purchasers in Illinois. Provides that the amendatory Act may be referred to as the Marketplace Fairness Act.
SB 2577 was apparently filed in anticipation of a decision by the U.S. Supreme Court in the Wayfair case. If the court upholds the South Dakota statute at issue in Wayfair, SB 2577 could likely pass constitutional muster. If the Supreme Court upholds the Quill physical presence standard, in my estimation, SB 2577 would not be enforceable.
The House Revenue committee held two hearings this week - February 27 and March 1.
The February 27 hearing was a "subject matter" hearing on cryptocurrencies and blockchain. The Illinois Blockchain and Distributed Ledger Task Force
Final Report to the General Assembly was a basis for the discussions. No substantive legislation was considered at this hearing.
The March 1 hearing of the House Revenue committee included a subject matter hearing on FY 19 revenue estimates. The report of the Illinois General Assembly bipartisan Commission on Governmental Accountability detailing revenue estimates for FY 19 is linked in the "Publications" category below. The committee was also scheduled to consider substantive legislation. The linked
bills were posted for committee consideration.
Only one of the posted bills was actually considered by the House Revenue committee this week.
HB 4279 which a
mends the Department of Natural Resources Act provides that the Department of Natural Resources has the authority to accept, receive, and administer on behalf of the State, federal grant funds associated with the development or preservation of recreational boating infrastructure on this State's waterways and distribute those funds as prescribed by the appropriate federal agency.
The House
Economic Opportunity Committee held a hearing on Feb 27. HB 4081 was considered and passed out of the committee on a partisan vote with all Democrats voting in favor of the bill.
HB 4081 creates the Call Center Worker and Consumer Protection Act. It provides that an employer that intends to relocate a call center or portions of a call center from Illinois to another state or a foreign country must provide notice to the State Treasurer at least 120 days before the relocation. Authorizes a civil penalty not to exceed $10,000 for violations. Requires the Treasurer to compile and post on the Treasurer's website a list of employers that have relocated call centers. Requires an employer that relocates a call center from Illinois to another state or a foreign country to repay grants, loans, and tax benefits that may have been received. Effective January 1, 2018. The Illinois Chamber strongly opposes this bill.
One of the Chamber Tax Institute proposals advanced closer to passage this week.
SB 2604 moved to third reading in the Senate. SB 2604
Amends the Uniform Penalty and Interest Act. Provides that the penalty for failure to pay the tax shown due or required to be shown due on a return shall be 15% (instead of 20%) of any amount that is paid after the date the Department of Revenue has initiated an audit or investigation of the taxpayer. Provides that the penalty shall be abated if the taxpayer paid to the Department at least 95% of the total tax liability (including any additional liability resulting from the audit or investigation) prior to the initiation of the audit or investigation.
The Illinois Department of Revenue distributed its
Analysis of the impact on Illinois tax revenue resulting from the federal Tax Cuts and Jobs Act.
New legislation:
Provides for filing of aviation fuel tax returns by retailers selling aviation fuel. Provides that if a municipality or business district doesn't certify that it has an airport-related purpose, the municipality's or district's local share of aviation fuel proceeds may not be distributed to the municipality or district. Amends the Illinois Municipal Code. Provides that funds received by a municipality from the imposition of taxes on the sale or use of aviation fuel may be used only for to expenditures for airport-related purposes. Defines "airport-related purposes". Provides that beginning July 1, 2018, the Department of Revenue shall certify to a municipality receiving distributions of use or occupation taxes imposed on aviation fuel the amount of tax attributed to aviation fuel sales as reported by retailers on aviation fuel tax returns to the Department of Revenue. Requires municipalities and business districts to certify whether the municipality has an airport-related purpose before imposing an occupation or use tax. Provides that beginning July 1, 2018, a municipality shall certify annually to the Department of Revenue that all of the municipality's expenditures of tax revenues generated from the sale or use of aviation fuel that were received on or after July 1, 2018 were devoted to airport-related purposes. Provides that the Department of Revenue shall provide forms and adopt rules for the filing of the certification. Limits the provisions' applicability only for so long as the revenue use requirements of specified federal statutes are binding on the State. Limits home rule powers.
Rulemaking
The March 2 edition of the
Illinois Register contains a rulemaking by the Property Appeal Board. This rulemaking amends Section 1910.5 - Construction and Definitions - Amended to provide a definition of "representation case."
The rulemaking also amends Section 1910.70 - Representation at Hearings. The rule is amended to add a new subsection to preclude a State of Illinois legislator from participating in a representation case on any matter before the Property Tax Appeal Board. A State of Illinois legislator is also precluded from participating in a representation case before the Property Tax Appeal Board where the legislator receives compensation, directly or indirectly, through an interest in a partnership, limited liability corporation, or other business entity.
According to the rulemaking, PTAB has not filed an emergency rulemaking to implement this proposed rule immediately. The rulemaking notice states that PTAB will accept written comments on the rulemaking for 45 days.
Today's edition of the Illinois Register did not contain any rulemaking by the Illinois Department of Revenue or the Illinois Department of Commerce and Economic Opportunity.
Tax Tribunal
No new decisions were issued by the Tribunal this week. Only two new cases were filed with the Tribunal this week. The new case does not appear to raise any novel issues.
Publications
Tax Institute Quarterly meeting
The next Quarterly meeting of the Tax Institute is March 12 and is hosted by Tax Institute member firm True Partners consulting LLC. Our featured speaker is IDOR Director Connie Beard. Please RSVP to me at [email protected].
|
