(35 ILCS 128/Art. 1 heading)
(35 ILCS 128/1-1)
Sec. 1-1. Short title. This Act may be cited as the Cigarette Machine Operators' Occupation Tax Act.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-5)
Sec. 1-5. Definitions. As used in this Act:
"Business" means any trade, occupation, activity or enterprise engaged in for the purpose of selling cigarettes in this State.
"Cigarette" means any roll for smoking made wholly or in part of tobacco, irrespective of size or shape and whether or not such tobacco is flavored, adulterated or mixed with any other ingredient, and the wrapper or cover of which is made of paper or any other substance or material except tobacco.
"Cigarette machine" means any machine, equipment or device used to make or fabricate cigarettes.
"Cigarette machine" shall not include a handheld manually operated device used by consumers to make roll-your-own cigarettes for personal consumption.
"Cigarette machine operator" means any person who is engaged in the business of operating a cigarette machine in this State and is licensed by the Department as a cigarette machine operator under Section 1-15 of this Act.
"Contraband cigarettes" means:
"Department" means the Department of Revenue.
"Operate or operating a cigarette machine" means to possess a cigarette machine for the purpose of engaging in the business of making the cigarette machine available to individuals who use the cigarette machine to make or fabricate cigarettes for their own use or consumption, and not for resale. For purposes of this Act, the cigarette machine is operated by the person possessing the cigarette machine. For purposes of this Act, cigarettes made or fabricated by the use of a cigarette machine in the possession of a cigarette machine operator holding a license under Section 1-15 of this Act are considered to be made or fabricated by the person holding the cigarette machine operator license and not the individual.
"Original package" means the individual packet, box, or other container used to contain and convey cigarettes to the consumer.
"Person" means any natural individual, firm, partnership, association, joint stock company, joint adventure, public or private corporation, however formed, limited liability company, or a receiver, executor, administrator, trustee, guardian, or other representative appointed by order of any court.
"Place of business" means any place where cigarettes are made or fabricated by a cigarette machine operator holding a license under Section 1-15 of this Act.
"Possess or possessing a cigarette machine" means to own, lease, rent or have on one's premises a cigarette machine for the purpose of engaging in the business of making the cigarette machine available to individuals who use the cigarette machine to make or fabricate cigarettes for their own use or consumption, and not for resale.
"Prior continuous compliance taxpayer" means any person who is licensed under this Act and who, having been a licensee for a continuous period of 5 years, is determined by the Department not to have been either delinquent or deficient in the payment of tax liability during that period or otherwise in violation of this Act. "Prior continuous compliance taxpayer" also means any taxpayer who has, as verified by the Department, continuously complied with the condition of his bond or other security under provisions of this Act for a period of 5 consecutive years.
"Retailer" means any person who engages in the making of transfers of the ownership of, or title to, tobacco or cigarettes to a purchaser for use or consumption and not for resale in any form, for a valuable consideration.
"Sale" means any transfer, exchange, or barter in any manner or by any means whatsoever for a consideration, and includes and means all sales made by any person.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-10)
Sec. 1-10. Tax imposed.
(a) Beginning August 1, 2012, a tax is imposed upon all persons engaged in the business of operating a cigarette machine. The tax is imposed at the rate of 99 mills per cigarette made or fabricated by a cigarette machine possessed by a cigarette machine operator.
(b) If, after July 1, 2012, the General Assembly increases the rate of tax imposed under Section 2 of the Cigarette Tax Act, then the tax imposed under subsection (a) of this Section shall be increased by the same amount beginning on the effective date of the Cigarette Tax increase, but not earlier than August 1, 2012.
(c) The tax herein imposed shall be in addition to all other occupation or privilege taxes imposed by the State of Illinois or by any municipal corporation or political subdivision thereof.
(d) Persons subject to the tax imposed by this Act may reimburse themselves for their tax liability under this Act by separately stating such tax, less any credit the machine operator claims under subsection (b) of Section 1-40 of this Act on tobacco sold to and used by users of a cigarette machine to make or fabricate cigarettes, as an additional charge to users of cigarette machines.
(e) If any cigarette machine operator collects an amount (however designated) which purports to reimburse such operator for his or her cigarette machine operators' occupation tax liability under this Act with respect to cigarettes that are not subject to cigarette machine operators' occupation tax under this Act, or if any cigarette machine operator, in collecting an amount (however designated) which purports to reimburse such operator for his or her cigarette machine operators' occupation tax liability measured by cigarettes made or fabricated by a cigarette machine that are subject to tax under this Act, collects more from the customer than the cigarette machine operators' cigarette machine operators' occupation tax liability in the transaction, the customer shall have a legal right to claim a refund of that amount from the cigarette machine operator. However, if such amount is not refunded to the customer for any reason, the cigarette machine operator is liable to pay such amount to the Department.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-15)
Sec. 1-15. Cigarette machine operator license. No person may engage in the business of operating a cigarette machine in this State on or after August 1, 2012 without first having obtained a license from the Department. Application for a license shall be made to the Department on a form furnished and prescribed by the Department. Each applicant for a license under this Section shall furnish the following information to the Department on a form signed and verified by the applicant under penalty of perjury:
The annual license fee payable to the Department for each cigarette machine operator license is $250. Each applicant for a license shall pay that fee to the Department at the time of submitting an application for license to the Department.
Every applicant who is required to procure a cigarette machine operator license shall file with his or her application a joint and several bond. Such bond shall be executed to the Department of Revenue, with good and sufficient surety or sureties residing or licensed to do business within the State of Illinois, in the amount of $2,500, conditioned upon the true and faithful compliance by the licensee with all of the provisions of this Act. Such bond, or a reissue thereof, or a substitute therefore, shall be kept in effect during the entire period covered by the license. A separate application for license shall be made, a separate annual license fee paid, and a separate bond filed, for each place of business at which a person who is required to procure a cigarette machine operator license under this Section proposes to engage in business as a cigarette machine operator in Illinois under this Act.
The following are ineligible to receive a cigarette machine operator license under this Act:
The Department, upon receipt of an application, license fee, and bond in proper form from a person who is eligible to receive a cigarette machine operator license under this Act, shall issue to such applicant a license in a form as prescribed by the Department. That license shall permit the applicant to whom it is issued to engage in business as a cigarette machine operator at the place shown in his or her application. All licenses issued by the Department under this Section shall be valid for a period not to exceed one year after issuance unless sooner revoked, canceled, or suspended as provided in this Act. No license issued under this Section is transferable or assignable. Such license shall be conspicuously displayed in the place of business conducted by the licensee in Illinois under such license. No cigarette machine operator acquires any vested interest or compensable property right in a license issued under this Act.
A cigarette machine operator shall notify the Department of any change in the information contained on the application form, including any change in ownership, and shall do so within 30 days after that change.
Every prior continuous compliance taxpayer shall be exempt from all requirements under this Section concerning the furnishing of bond as a condition precedent to his being authorized to engage in the business licensed under this Act. This exemption shall continue for each prior continuous compliance taxpayer until such time as he may be determined by the Department to be delinquent in the filing of any returns, or is determined by the Department (either through the Department's issuance of a final assessment which has become final under the Act, or by the taxpayer's filing of a return which admits tax to be due that is not paid) to be delinquent or deficient in the paying of any tax under this Act, at which time that taxpayer shall become subject to the bond requirements of this Section and, as a condition of being allowed to continue to engage in the business licensed under this Act, shall be required to furnish bond to the Department in such form as provided in this Section. The taxpayer shall furnish such bond for a period of 2 years, after which, if the taxpayer has not been delinquent in the filing of any returns, or delinquent or deficient in the paying of any tax under this Act, the Department may reinstate that person as a prior continuance compliance taxpayer. Any taxpayer who fails to pay an admitted or established liability under this Act may also be required by the Department to post bond or other acceptable security with the Department guaranteeing the payment of that admitted or established liability.
The Department shall discharge any surety and shall release and return any bond or security deposited, assigned, pledged, or otherwise provided to it by a taxpayer under this Section within 30 days after:
Any person aggrieved by any decision of the Department under this Section may, within 20 days after receiving notice of the decision, protest and request a hearing. Upon receiving a written request for a hearing, the Department shall give notice to the person requesting the hearing of the time and place fixed for the hearing and shall hold a hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to that person. In the absence of a protest and request for a hearing within 20 days, the Department's decision shall become final without any further determination being made or notice given.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-20)
Sec. 1-20. Revocation, cancellation, or suspension of license. The Department may, after notice and hearing as provided for by this Act, revoke, cancel, or suspend the license of any cigarette machine operator for the violation of any provision of this Act, or for noncompliance with the provisions of this Act, or for any noncompliance with any lawful rule or regulation promulgated by the Department under this Act, or because the licensee is determined to be ineligible for a cigarette machine operator's license for any one or more of the reasons provided for in Section 1-15 of this Act.
Any cigarette machine operator aggrieved by any decision of the Department under this Section may, within 20 days after notice of the decision, protest and request a hearing. Upon receiving a written request for a hearing, the Department shall give notice in writing to the cigarette machine operator requesting the hearing that contains a statement of the charges preferred against the cigarette machine operator and that states the time and place fixed for the hearing. The Department shall hold the hearing in conformity with the provisions of this Act and then issue its final administrative decision in the matter to the cigarette machine operator. In the absence of a written protest and request for a hearing within 20 days, the Department's decision shall become final without any further determination being made or notice given.
No license so revoked shall be reissued to any cigarette machine operator for a period of 6 months after the date of the final determination of such revocation. No license shall be reissued at all so long as the person who would receive the license is ineligible to receive a cigarette machine operator's license under this Act for any one or more of the reasons provided for in Section 1-15 of this Act.
The Department, upon complaint filed in the circuit court, may, by injunction, restrain any person who fails or refuses to comply with any of the provisions of this Act from acting as a cigarette machine operator in this State.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-25)
Sec. 1-25. Restriction on tobacco used in cigarette machines.
(a) Only roll-your-own tobacco products of a brand family and manufacturer identified on the State of Illinois Directory of Participating Manufacturers or the Illinois Directory of Compliant Non-Participating Manufacturers maintained by the Office of the Attorney General may be sold by cigarette machine operators to customers for use in cigarette machines possessed by the cigarette machine operator.
(b) Only roll-your-own tobacco products meeting the requirements of subsection (a) and purchased at the place of business of the cigarette machine operator may be used in a cigarette machine at that location.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-30)
Sec. 1-30. Cigarette tubes used in cigarette machines.
(a) All cigarette tubes used in cigarette machines in the possession of cigarette machine operators licensed under Section 1-15 of this Act shall be constructed of paper of a type determined by the Attorney General, pursuant to rules promulgated by the Attorney General under the provisions of the Administrative Procedure Act, to reduce the likely ignition propensity of cigarettes made by those tubes.
(b) A cigarette machine operator is not required to comply with subsection (a) of this Section until the Attorney General has promulgated rules implementing subsection (a) and the rules have become effective. The effective date for such rules shall be no earlier than 6 months after the date on which an appropriate nationally recognized standard is developed for the reduced ignition propensity of cigarette tubes.
(Source: P.A. 97-688, eff. 6-14-12; 98-1163, eff. 1-9-15.)
(35 ILCS 128/1-35)
Sec. 1-35. Cigarette machine operators; sale of cigarettes.
(a) The cigarette machine operator is responsible for complying with all State and federal laws and regulations regarding packaging and labeling of original packages of cigarettes.
(b) A person possessing a cigarette machine operator license may not purchase unstamped cigarettes from an in-State or out-of-State manufacturer or distributor of cigarettes.
(c) Cigarettes made or fabricated by a cigarette machine may not be sold or distributed to, or possessed by, manufacturers, distributors, secondary distributors, manufacturer representatives, or retailers, except the cigarette machine operator.
(d) A cigarette machine possessed by a cigarette machine operator shall have a secure meter that counts the number of cigarettes made or fabricated by the cigarette machine and that cannot be accessed, altered, or reset by the machine operator, except for the sole purpose of taking meter readings.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-40)
Sec. 1-40. Returns.
(a) Cigarette machine operators shall file a return and remit the tax imposed by Section 1-10 by the 15th day of each month covering the preceding calendar month. Each such return shall show: the quantity of cigarettes made or fabricated during the period covered by the return; the beginning and ending meter reading for each cigarette machine for the period covered by the return; the quantity of such cigarettes sold or otherwise disposed of during the period covered by the return; the brand family and manufacturer and quantity of tobacco products used to make or fabricate cigarettes by use of a cigarette machine; the license number of each distributor from whom tobacco products are purchased; the type and quantity of cigarette tubes purchased for use in a cigarette machine; the type and quantity of cigarette tubes used in a cigarette machine; and such other information as the Department may require. Such returns shall be filed on forms prescribed and furnished by the Department. The Department may promulgate rules to require that the cigarette machine operator's return be accompanied by appropriate computer-generated magnetic media supporting schedule data in the format required by the Department, unless, as provided by rule, the Department grants an exception upon petition of a cigarette machine operator.
Cigarette machine operators shall send a copy of those returns, together with supporting schedule data, to the Attorney General's Office by the 15th day of each month for the period covering the preceding calendar month.
(b) Cigarette machine operators may take a credit against any tax due under Section 1-10 of this Act for taxes imposed and paid under the Tobacco Products Tax Act of 1995 on tobacco products sold to a customer and used in a rolling machine located at the cigarette machine operator's place of business. To be eligible for such credit, the tobacco product must meet the requirements of subsection (a) of Section 1-25 of this Act. This subsection (b) is exempt from the provisions of Section 1-155 of this Act.
(c) If any payment provided for in this Section exceeds the cigarette machine operator's liabilities under this Act, as shown on an original return, the cigarette machine operator may credit such excess payment against liability subsequently to be remitted to the Department under this Act, in accordance with reasonable rules adopted by the Department.
(Source: P.A. 100-1171, eff. 1-4-19.)
(35 ILCS 128/1-45)
Sec. 1-45. Examination and correction of returns.
(a) As soon as practicable after any return is filed, the Department shall examine that return and shall correct the return according to its best judgment and information, which return so corrected by the Department shall be prima facie correct and shall be prima facie evidence of the correctness of the amount of tax due, as shown on the corrected return. Instead of requiring the cigarette machine operator to file an amended return, the Department may simply notify the cigarette machine operator of the correction or corrections it has made. Proof of the correction by the Department may be made at any hearing before the Department or in any legal proceeding by a reproduced copy of the Department's record relating thereto in the name of the Department under the certificate of the Director of Revenue. Such reproduced copy shall, without further proof, be admitted into evidence before the Department or in any legal proceeding and shall be prima facie proof of the correctness of the amount of tax due, as shown on the reproduced copy. If the Department finds that any amount of tax is due from the cigarette machine operator, the Department shall issue the cigarette machine operator a notice of tax liability for the amount of tax claimed by the Department to be due, together with a penalty in an amount determined in accordance with Sections 3-3, 3-5 and 3-6 of the Uniform Penalty and Interest Act. If, in administering the provisions of this Act, comparison of a return or returns of a cigarette machine operator with the books, records, and inventories of such cigarette machine operator discloses a deficiency that cannot be allocated by the Department to a particular month or months, the Department shall issue the cigarette machine operator a notice of tax liability for the amount of tax claimed by the Department to be due for a given period, but without any obligation upon the Department to allocate that deficiency to any particular month or months, together with a penalty in an amount determined in accordance with Sections 3-3, 3-5, and 3-6 of the Uniform Penalty and Interest Act, under which circumstances the aforesaid notice of tax liability shall be prima facie correct and shall be prima facie evidence of the correctness of the amount of tax due, as shown therein; and proof of such correctness may be made in accordance with, and the admissibility of a reproduced copy of such notice of tax liability shall be governed by, all the provisions of this Act applicable to corrected returns. If any cigarette machine operator filing any return dies or becomes a person under legal disability at any time before the Department issues its notice of tax liability, such notice shall be issued to the administrator, executor, or other legal representative of the cigarette machine operator.
(b) If, within 60 days after such notice of tax liability, the cigarette machine operator or his or her legal representative files a written protest to such notice of tax liability and requests a hearing thereon, the Department shall give notice to such cigarette machine operator or legal representative of the time and place fixed for such hearing, and shall hold a hearing in conformity with the provisions of this Act, and pursuant thereto shall issue a final assessment to such cigarette machine operator or legal representative for the amount found to be due as a result of such hearing. If a written protest to the notice of tax liability and a request for a hearing thereon is not filed within 60 days after such notice of tax liability, such notice of tax liability shall become final without the necessity of a final assessment being issued and shall be deemed to be a final assessment.
(c) In case of failure to pay the tax, or any portion thereof, or any penalty provided for in this Act, when due, the Department may bring suit to recover the amount of such tax, or portion thereof, or penalty; or, if the taxpayer dies or becomes incompetent, by filing claim therefore against his or her estate; provided that no such action with respect to any tax, or portion thereof, or penalty, shall be instituted more than 2 years after the cause of action accrues, except with the consent of the person from whom such tax or penalty is due.
After the expiration of the period within which the person assessed may file an action for judicial review under the Administrative Review Law without such an action being filed, a certified copy of the final assessment or revised final assessment of the Department may be filed with the circuit court of the county in which the taxpayer has his or her principal place of business, or of Sangamon County in those cases in which the taxpayer does not have his or her principal place of business in this State. The certified copy of the final assessment or revised final assessment shall be accompanied by a certification which recites facts that are sufficient to show that the Department complied with the jurisdictional requirements of the law in arriving at its final assessment or its revised final assessment and that the taxpayer had his or her opportunity for an administrative hearing and for judicial review, whether he or she availed himself or herself of either or both of these opportunities or not. If the court is satisfied that the Department complied with the jurisdictional requirements of the law in arriving at its final assessment or its revised final assessment and that the taxpayer had his or her opportunity for an administrative hearing and for judicial review, whether he or she availed himself or herself of either or both of these opportunities or not, the court shall enter judgment in favor of the Department and against the taxpayer for the amount shown to be due by the final assessment or the revised final assessment, and such judgment shall be filed of record in the court. Such judgment shall bear the rate of interest set in the Uniform Penalty and Interest Act, but otherwise shall have the same effect as other judgments. The judgment may be enforced, and all laws applicable to sales for the enforcement of a judgment shall be applicable to sales made under such judgments. The Department shall file the certified copy of its assessment, as herein provided, with the circuit court within 2 years after such assessment becomes final except when the taxpayer consents in writing to an extension of such filing period.
If, when the cause of action for a proceeding in court accrues against a person, he or she is out of the State, the action may be commenced within the times herein limited, after his or her coming into or returning to the State; and if, after the cause of action accrues, he or she departs from and remains out of the State, the time of his or her absence is no part of the time limited for the commencement of the action; but the foregoing provisions concerning absence from the State shall not apply to any case in which, at the time the cause of action accrues, the party against whom the cause of action accrues is not a resident of this State. The time within which a court action is to be commenced by the Department hereunder shall not run while the taxpayer is a debtor in any proceeding under the federal Bankruptcy Code nor thereafter until 90 days after the Department is notified by such debtor of being discharged in bankruptcy.
No claim shall be filed against the estate of any deceased person or a person under legal disability for any tax or penalty or part of either except in the manner prescribed and within the time limited by the Probate Act of 1975.
The remedies provided for herein shall not be exclusive, but all remedies available to creditors for the collection of debts shall be available for the collection of any tax or penalty due hereunder.
The collection of tax or penalty by any means provided for herein shall not be a bar to any prosecution under this Act.
The certificate of the Director of the Department to the effect that a tax or amount required to be paid by this Act has not been paid, that a return has not been filed, or that information has not been supplied pursuant to the provisions of this Act, shall be prima facie evidence thereof.
All of the provisions of Sections 5a, 5b, 5c, 5d, 5e, 5f, 5g, 5i and 5j of the Retailers' Occupation Tax Act, which are not inconsistent with this Act, shall apply, as far as practicable, to the subject matter of this Act to the same extent as if such provisions were included herein. References in such incorporated Sections of the Retailers' Occupation Tax Act to retailers, to sellers, or to persons engaged in the business of selling tangible personal property shall mean cigarette machine operator when used in this Act.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-50)
Sec. 1-50. Failure to file return or pay tax; penalty; protest. In case any person who is required to file a return under this Act fails to file a return, or files a return and fails to remit the correct amount of tax, the Department shall determine the amount of tax due from him according to its best judgment and information, which amount so fixed by the Department shall be prima facie correct and shall be prima facie evidence of the correctness of the amount of tax due, as shown in such determination. Proof of such determination by the Department may be made at any hearing before the Department or in any legal proceeding by a reproduced copy of the Department's record relating thereto in the name of the Department under the certificate of the Director of Revenue. Such reproduced copy shall, without further proof, be admitted into evidence before the Department or in any legal proceeding and shall be prima facie proof of the correctness of the amount of tax due, as shown therein. The Department shall issue such person a notice of tax liability for the amount of tax claimed by the Department to be due, together with a penalty in an amount determined in accordance with Sections 3-3, 3-5 and 3-6 of the Uniform Penalty and Interest Act. If such person or the legal representative of such person, within 60 days after such notice, files a written protest to such notice of tax liability and requests a hearing thereon, the Department shall give notice to such person or the legal representative of such person of the time and place fixed for such hearing and shall hold a hearing in conformity with the provisions of this Act, and pursuant thereto shall issue a final assessment to such person or to the legal representative of such person for the amount found to be due as a result of such hearing. If a written protest to the notice of tax liability and a request for a hearing thereon is not filed within 60 days after such notice of tax liability, such notice of tax liability shall become final without the necessity of a final assessment being issued and shall be deemed to be a final assessment.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-55)
Sec. 1-55. Claims; credit memorandum or refunds. If it appears, after claim is filed with the Department, that an amount of tax or penalty has been paid which was not due under this Act, whether as the result of a mistake of fact or an error of law, except as hereinafter provided, then the Department shall issue a credit memorandum or refund to the person who made the erroneous payment or, if that person has died or become a person under legal disability, to his or her legal representative.
If it is determined that the Department should issue a credit or refund under this Act, the Department may first apply the amount thereof against any amount of tax or penalty due under this Act, the Cigarette Tax Act, the Cigarette Use Tax Act, or the Tobacco Products Act of 1995 from the person entitled to that credit or refund. For this purpose, if proceedings are pending to determine whether or not any tax or penalty is due under this Act or under the Cigarette Tax Act, Cigarette Use Tax Act, or the Tobacco Products Act of 1995 from the person, the Department may withhold issuance of the credit or refund pending the final disposition of such proceedings and may apply such credit or refund against any amount found to be due to the Department under this Act, the Cigarette Tax Act, the Cigarette Use Tax Act, or the Tobacco Products Act of 1995 as a result of such proceedings. The balance, if any, of the credit or refund shall be issued to the person entitled thereto.
If no tax or penalty is due and no proceeding is pending to determine whether such taxpayer is indebted to the Department for the payment of a tax or penalty, the credit memorandum or refund shall be issued to the claimant; or (in the case of a credit memorandum) the credit memorandum may be assigned and set over by the lawful holder thereof, subject to reasonable rules of the Department, to any other person who is subject to this Act, the Cigarette Tax Act, the Cigarette Use Tax Act, or the Tobacco Products Act of 1995, and the amount thereof shall be applied by the Department against any tax or penalty due or to become due under this Act, the Cigarette Tax Act, the Cigarette Use Tax Act, or the Tobacco Products Act of 1995 from such assignee.
As to any claim filed hereunder with the Department on and after each January 1 and July 1, no amount of tax or penalty erroneously paid (either in total or partial liquidation of a tax or penalty under this Act) more than 3 years prior to such January 1 and July 1, respectively, shall be credited or refunded, except that, if both the Department and the taxpayer have agreed to an extension of time to issue a notice of tax liability under this Act, the claim may be filed at any time prior to the expiration of the period agreed upon. Notwithstanding any other provision of this Act to the contrary, for any period included in a claim for credit or refund for which the statute of limitations for issuing a notice of tax liability under this Act will expire less than 6 months after the date a taxpayer files the claim for credit or refund, the statute of limitations is automatically extended for 6 months from the date it would have otherwise expired.
Any credit or refund that is allowed under this Act shall bear interest at the rate and in the manner set forth in the Uniform Penalty and Interest Act.
In case the Department determines that the claimant is entitled to a refund, such refund shall be made only from appropriations available for that purpose. If it appears unlikely that the amount appropriated would permit everyone having a claim allowed during the period covered by such appropriation to elect to receive a cash refund, the Department, by rule or regulation, shall provide for the payment of refunds in hardship cases and shall define what types of cases qualify as hardship cases.
The provisions of Sections 6a, 6b, and 6c of the Retailers' Occupation Tax Act which are not inconsistent with this Act shall apply, as far as practicable, to the subject matter of this Act to the same extent as if such provisions were included herein.
(Source: P.A. 102-40, eff. 6-25-21.)
(35 ILCS 128/1-60)
Sec. 1-60. Investigations and hearings. The Department, or any officer or employee designated in writing by the Director thereof, for the purpose of administering and enforcing the provisions of this Act, may hold investigations and hearings concerning any matters covered by this Act, and may examine books, papers, records, or memoranda bearing upon the sale or other disposition of cigarettes or tobacco products by a cigarette machine operator, and may issue subpoenas requiring the attendance of a cigarette machine operator, or any officer or employee of a cigarette machine operator, or any person having knowledge of the facts, and may take testimony and require proof, and may issue subpoenas duces tecum to compel the production of relevant books, papers, records, and memoranda, for the information of the Department.
In the conduct of any investigation or hearing provided for by this Act, neither the Department, nor any officer or employee thereof, shall be bound by the technical rules of evidence, and no informality in the proceedings nor in the manner of taking testimony shall invalidate any rule, order, decision, or regulation made, approved, or confirmed by the Department.
The Director of Revenue, or any duly authorized officer or employee of the Department, shall have the power to administer oaths to such persons required by this Act to give testimony before the Department.
The books, papers, records, and memoranda of the Department, or parts thereof, may be proved in any hearing, investigation or legal proceeding by a reproduced copy thereof under the certificate of the Director of Revenue. Such reproduced copy shall, without further proof, be admitted into evidence before the Department or in any legal proceeding.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-65)
Sec. 1-65. Testimony and production of documents; immunity. No person shall be excused from testifying or from producing any books, papers, records, or memoranda in any investigation or upon any hearing, when ordered to do so by the Department or any officer or employee thereof, upon the ground that the testimony or evidence, documentary or otherwise, may tend to incriminate him or subject him to a criminal penalty, but no person shall be prosecuted or subjected to any criminal penalty for or on account of the subject matter of his or her testimony or the evidence produced before the Department or an officer or employee of the Department; provided that such immunity shall extend only to a natural person who, in obedience to a subpoena, gives testimony under oath or produces evidence under oath. No person so testifying shall be exempt from prosecution and punishment for perjury committed in so testifying.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-70)
Sec. 1-70. Confidentiality; official purposes. All information received by the Department from returns or reports filed under this Act, or from any investigation conducted under this Act, shall be confidential, except for official purposes, and any person who divulges any such information in any manner, except in accordance with a proper judicial order or as otherwise provided by law, shall be guilty of a Class A misdemeanor.
Nothing in this Act prevents the Director of Revenue from publishing or making available to the public the names and addresses of persons filing returns or reports under this Act, or reasonable statistics concerning the operation of the tax by grouping the contents of returns or reports so that the information in any individual return or report is not disclosed.
Nothing in this Act prevents the Director of Revenue from divulging to the United States government or the government of any other state, or any officer or agency thereof, for exclusively official purposes, information received by the Department in administering this Act, provided that such other governmental agency agrees to divulge requested tax information to the Department.
The furnishing upon request of the Auditor General, or his authorized agents, for official use, of returns or reports filed and information related thereto under this Act is deemed to be an official purpose within the meaning of this Section.
The furnishing of financial information to a home rule unit with a population in excess of 2,000,000 that has imposed a tax similar to that imposed by this Act under its home rule powers, upon request of the Chief Executive of the home rule unit, is an official purpose within the meaning of this Section, provided the home rule unit agrees in writing to the requirements of this Section. Information so provided is subject to all confidentiality provisions of this Section. The written agreement shall provide for reciprocity, limitations on access, disclosure, and procedures for requesting information.
The Director may make available to any State agency, including the Illinois Supreme Court, that licenses persons to engage in any occupation, information that a person licensed by such agency has failed to file returns under this Act or pay the tax, penalty, and interest shown therein, or has failed to pay any final assessment of tax, penalty, or interest due under this Act or has failed to file reports under this Act. An assessment is final when all proceedings in court for review of such assessment have terminated or the time for the taking thereof has expired without such proceedings being instituted.
The Director shall make available for public inspection in the Department's principal office and for publication, at cost, administrative decisions issued on or after January 1, 2013. These decisions are to be made available in a manner so that the following taxpayer or licensee information is not disclosed:
The Director shall determine the appropriate extent of the deletions allowed in paragraph (2). In the event the taxpayer or licensee does not submit deletions, the Director shall make only the deletions specified in paragraph (1).
The Director shall make available for public inspection and publication each administrative decision within 180 days after the issuance of the administrative decision. The term "administrative decision" has the same meaning as defined in Section 3-101 of the Code of Civil Procedure. Costs collected under this Section shall be paid into the Tax Compliance and Administration Fund.
Nothing contained in this Act shall prevent the Director from divulging information to any person pursuant to a request or authorization made by the taxpayer or licensee or by an authorized representative of the taxpayer or licensee.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-75)
Sec. 1-75. Records. Every cigarette machine operator who is required to procure a license under this Act shall keep within Illinois, at his licensed address: complete and accurate records of the quantity of such cigarettes made or fabricated; meter readings for each cigarette machine; the quantity of such cigarettes sold or otherwise disposed of; the brand family and manufacturer and quantity of tobacco products purchased and the brand family and manufacturer and quantity of tobacco products used to make or fabricate cigarettes by use of a cigarette machine; the name, address, and license number of each distributor from whom the cigarette machine operator purchases tobacco products; the type and quantity of cigarette tubes purchased for use in a cigarette machine; the type and quantity of cigarette tubes used in a cigarette machine; and such other information as the Department may require, and shall preserve and keep within Illinois at his licensed address all invoices, bills of lading, sales records, copies of bills of sale, inventory at the close of each period for which a return is required of all cigarettes, tobacco products and cigarette tubes on hand, and other pertinent papers and documents relating to the manufacture, purchase, sale, or disposition of cigarettes and tobacco products. All books and records and other papers and documents that are required by this Act to be kept shall be kept in the English language, and shall, at all times during the usual business hours of the day, be subject to inspection by the Department or its duly authorized agents and employees. The Department may adopt rules that establish requirements, including record forms and formats, for records required to be kept and maintained by taxpayers. For purposes of this Section, "records" means all data maintained by the taxpayer, including data on paper, microfilm, microfiche or any type of machine-sensible data compilation. Those books, records, papers and documents shall be preserved for a period of at least 3 years after the date of the documents, or the date of the entries appearing in the records, unless the Department, in writing, authorizes their destruction or disposal at an earlier date. At all times during the usual business hours of the day, any duly authorized agent or employee of the Department may enter any place of business of the cigarette machine operator, without a search warrant, and inspect the premises and the stock or packages of cigarettes, tobacco products, cigarette tubes, and the cigarette machines therein contained, to determine whether any of the provisions of this Act are being violated. If such agent or employee is denied free access or is hindered or interfered with in making such examination as herein provided, the license of the cigarette machine operator at such premises shall be subject to revocation by the Department.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-80)
Sec. 1-80. Subpoenas and witnesses; depositions. The Department, or any officer or employee of the Department designated in writing by the Director, shall, at its, his, or her own instance, or on the written request of any cigarette machine operator or other interested party to the proceeding, issue subpoenas requiring the attendance of and the giving of testimony by witnesses, and subpoenas duces tecum requiring the production of books, papers, records or memoranda. All subpoenas and subpoenas duces tecum issued under the terms of this Act may be served by any person of full age. The fees of witnesses for attendance and travel shall be the same as the fees of witnesses before the circuit court of this State; such fees to be paid when the witness is excused from further attendance. When the witness is subpoenaed at the instance of the Department or any officer or employee thereof, such fees shall be paid in the same manner as other expenses of the Department, and when the witness is subpoenaed at the instance of any other party to any such proceeding, the cost of service of the subpoena or subpoena duces tecum and the fee of the witness shall be borne by the party at whose instance the witness is summoned. In such case, the Department, in its discretion, may require a deposit to cover the cost of such service and witness fees. A subpoena or subpoena duces tecum so issued shall be served in the same manner as a subpoena or subpoena duces tecum issued out of a court.
Any circuit court of this State, upon the application of the Department or any officer or employee thereof, or upon the application of any other party to the proceeding, may, in its discretion, compel the attendance of witnesses, the production of books, papers, records or memoranda and the giving of testimony before the Department or any officer or employee thereof conducting an investigation or holding a hearing authorized by this Act, by an attachment for contempt, or otherwise, in the same manner as production of evidence may be compelled before the court.
The Department or any officer or employee thereof, or any other party in an investigation or hearing before the Department, may cause the depositions of witnesses within the State to be taken in the manner prescribed by law for like depositions, or depositions for discovery in civil actions in courts of this State, and to that end compel the attendance of witnesses and the production of books, papers, records or memoranda, in the same manner provided herein.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-85)
Sec. 1-85. Regulations and rules; notice; hearings. The Department may adopt and enforce such reasonable rules and regulations relating to the administration and enforcement of this Act as may be deemed expedient.
Whenever notice is required by this Act, such notice may be given by United States certified or registered mail, addressed to the person concerned at his last known address, and proof of such mailing shall be sufficient for the purposes of this Act. Notice of any hearing provided for by this Act shall be so given not less than 7 days prior to the day fixed for the hearing.
Hearings provided for in this Act shall be held:
The circuit court of the county wherein the hearing is held has power to review all final administrative decisions of the Department in administering this Act. The provisions of the Administrative Review Law, and all amendments and modifications thereof, and the rules adopted pursuant thereto, shall apply to and govern all proceedings for the judicial review of final administrative decisions of the Department under this Act. The term "administrative decision" is defined as in Section 3-101 of the Code of Civil Procedure.
Service upon the Director of Revenue or Assistant Director of Revenue of summons issued in any action to review a final administrative decision shall be service upon the Department. The Department shall certify the record of its proceedings if the cigarette machine operator pays to it the sum of 75¢ per page of testimony taken before the Department and 25¢ per page of all other matters contained in such record, except that these charges may be waived where the Department is satisfied that the aggrieved party is an indigent person who cannot afford to pay such charges. Before the delivery of such record to the person applying for it, payment of these charges must be made, and if the record is not paid for within 30 days after notice that such record is available, the complaint may be dismissed by the court upon motion of the Department.
No stay order shall be entered by the circuit court unless the cigarette machine operator files with the court a bond, in an amount fixed and approved by the court, to indemnify the State against all loss and injury which may be sustained by it on account of the review proceedings and to secure all costs which may be occasioned by such proceedings.
Whenever any proceeding provided by this Act is begun before the Department, either by the Department or by a person subject to this Act, and such person thereafter dies or becomes a person under legal disability before such proceeding is concluded, the legal representative of the deceased person or of the person under legal disability shall notify the Department of such death or legal disability. Such legal representative, as such, shall then be substituted by the Department for such person. If the legal representative fails to notify the Department of his or her appointment as such legal representative, the Department may, upon its own motion, substitute such legal representative in the proceeding pending before the Department for the person who died or became a person under legal disability.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-90)
Sec. 1-90. The Illinois Administrative Procedure Act. The Illinois Administrative Procedure Act is hereby expressly adopted and shall apply to all administrative rules and procedures of the Department of Revenue under this Act, except that: (1) paragraph (b) of Section 5-10 of the Illinois Administrative Procedure Act does not apply to final orders, decisions and opinions of the Department; (2) subparagraph (a)(ii) of Section 5-10 of the Illinois Administrative Procedure Act does not apply to forms established by the Department for use under this Act; and (3) the provisions of Section 10-45 of the Illinois Administrative Procedure Act regarding proposals for decision are excluded and not applicable to the Department under this Act.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-95)
Sec. 1-95. Legal proceedings. All legal proceedings under this Act, whether civil or criminal, shall be instituted and prosecuted by the Attorney General or by the State's Attorney for the county in which an offense under this Act is committed, and all civil actions may be brought in the name of the Department of Revenue.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-100)
Sec. 1-100. Arrest and seizure. Any duly authorized employee of the Department: may arrest without warrant any person committing in his presence a violation of any of the provisions of this Act; may without a search warrant inspect all cigarettes and cigarette machines located in any place of business; and may seize any contraband cigarettes and any cigarette machines in which such contraband cigarettes may be found or may be made, and such packages or cigarette machines so seized shall be subject to confiscation and forfeiture as provided in Section 1-105 of this Act.
(Source: P.A. 97-688, eff. 6-14-12; 98-463, eff. 8-16-13.)
(35 ILCS 128/1-105)
Sec. 1-105. Hearings regarding seized cigarettes and cigarette machines. After seizing any cigarettes or cigarette machines, as provided in Section 1-100 of this Act, the Department shall hold a hearing and shall determine whether such cigarettes, at the time of their seizure by the Department, were contraband cigarettes, or whether such cigarette machines, at the time of their seizure by the Department, contained or made contraband cigarettes. The Department shall give not less than 7 days' notice of the time and place of such hearing to the owner of such property, if he is known, and also to the person in whose possession the property so taken was found, if such person is known and if such person in possession is not the owner of said property. In case neither the owner nor the person in possession of such property is known, the Department shall cause publication of the time and place of such hearing to be made at least once in each week for 3 weeks successively in a newspaper of general circulation in the county where such hearing is to be held.
If, as the result of such hearing, the Department determines that the cigarettes seized were, at the time of seizure, contraband cigarettes, or that any cigarette machine at the time of its seizure contained or made contraband cigarettes, the Department shall enter an order declaring such cigarettes or such cigarette machine confiscated and forfeited to the State, and to be held by the Department for disposal as provided in this Section. The Department shall give notice of such order to the owner of such property if he is known, and also to the person in whose possession the property so taken was found, if such person is known, and if such person in possession is not the owner of the property. In case neither the owner nor the person in possession of such property is known, the Department shall cause publication of such order to be made at least once in each week for 3 weeks successively in a newspaper of general circulation in the county where such hearing was held.
When any cigarettes or any cigarette machine shall have been declared forfeited to the State by the Department, as provided hereunder, and when all proceedings for the judicial review of the Department's decision have terminated, the Department shall, to the extent that its decision is sustained on review, destroy or maintain and use such property in an undercover capacity.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-110)
Sec. 1-110. Filing of a complaint. Whenever any peace officer of the State or any duly authorized officer or employee of the Department shall have reason to believe that any violation of this Act has occurred and that the person so violating the Act has in that person's possession contraband cigarettes, or any cigarette machine containing or making contraband cigarettes, he or she may file or cause to be filed his complaint in writing, verified by affidavit, with any court within whose jurisdiction the premises to be searched are situated, stating the facts upon which such belief is founded, the premises to be searched, and the property to be seized, and procure a search warrant and execute the same. Upon the execution of such search warrant, the peace officer, or officer or employee of the Department, executing such search warrant shall make due return thereof to the court issuing the same, together with an inventory of the property taken thereunder. The court shall thereupon issue process against the owner of such property if he is known; otherwise, such process shall be issued against the person in whose possession the property so taken is found, if such person is known. In case of inability to serve such process upon the owner or the person in possession of the property at the time of its seizure, notice of the proceedings before the court shall be given as required by the statutes of the State governing cases of attachment. Upon the return of the process duly served or upon the posting or publishing of notice made, as herein provided, the court or jury, if a jury shall be demanded, shall proceed to determine whether or not such property so seized was held or possessed in violation of this Act, or whether, if a cigarette machine has been so seized, it contained or was making at the time of its seizure contraband cigarettes. In case of a finding that any cigarette machine so seized contained or was making at the time of its seizure contraband cigarettes, judgment shall be entered confiscating and forfeiting the property to the State and ordering its delivery to the Department, and, in addition thereto, the court shall have power to tax and assess the costs of the proceedings.
When any cigarettes or any cigarette machine is declared forfeited to the State by any court, and when such confiscated and forfeited property is delivered to the Department as provided in this Act, the Department shall destroy or maintain and use such property in an undercover capacity.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-115)
Sec. 1-115. False or fraudulent reports. Any person required by this Act to make, file, render, sign, or verify any report or return, or any officer, agent, or employee of that person, who makes any false or fraudulent report or return or files any false or fraudulent report or return, or who fails to make such report or return or file such report or return when due, is guilty of a Class 4 felony.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-120)
Sec. 1-120. Possession of more than 200 contraband cigarettes; penalty. Any person possessing more than 200 contraband cigarettes is liable to pay, to the Department, for deposit into the Tax Compliance and Administration Fund, a penalty of $1 for each such cigarette in excess of 200, unless reasonable cause can be established by the person upon whom the penalty is imposed. This penalty is in addition to the taxes imposed by this Act. Reasonable cause shall be determined in each situation in accordance with rules adopted by the Department. The provisions of the Uniform Penalty and Interest Act do not apply to this Section.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-125)
Sec. 1-125. Possession of not less than 20 and not more than 200 contraband cigarettes; penalty. Any person possessing not less than 20 and not more than 200 contraband cigarettes is liable to pay to the Department, for deposit into the Tax Compliance and Administration Fund, a penalty of $0.50 for each such cigarette, unless reasonable cause can be established by the person upon whom the penalty is imposed. Reasonable cause shall be determined in each situation in accordance with rules adopted by the Department. The provisions of the Uniform Penalty and Interest Act do not apply to this Section.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-130)
Sec. 1-130. Punishment for sale or possession of contraband cigarettes.
(a) Possession or sale of 200 or less contraband cigarettes. Any person who has in his or her possession or sells 200 or less contraband cigarettes is guilty of a Class A misdemeanor.
(b) Possession or sale of more than 200 and not more 1000 contraband cigarettes. Any person who has in his or her possession or sells more than 200 and not more than 1000 contraband cigarettes is guilty of a Class A misdemeanor for a first offense and a Class 4 felony for each subsequent offense.
(c) Possession or sale of more than 1000 contraband cigarettes. Any person who has in his or her possession or sells more than 1000 contraband cigarettes is guilty of a Class 4 felony.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-135)
Sec. 1-135. Unlawful operation of cigarette machines. Whoever operates a cigarette machine without a license is guilty of a Class 4 felony. Notwithstanding this Section, and any other provisions of this Act, an individual may own a cigarette machine for that individual's own use, and not for the purpose of resale of cigarettes.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-140)
Sec. 1-140. Failure to keep records; penalty. Any person required by this Act to keep records of any kind, who fails to keep the required records or falsifies those records, is guilty of a Class 4 felony.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-145)
Sec. 1-145. Failure to preserve records; penalty. Any person who fails to safely preserve the records required by Section 1-75 of this Act for the period of 3 years, as required by that Section, in such manner as to insure permanency and accessibility for inspection by the Department, shall be guilty of a business offense and may be fined up to $5,000.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-150)
Sec. 1-150. Forfeit of bond. If a cigarette machine operator is convicted of the violation of any of the provisions of this Act, or if his or her license is revoked and no review is had of the order or revocation, or if on review thereof the decision is adverse to the cigarette machine operator, or if a cigarette machine operator fails to pay an assessment as to which no judicial review is sought and which has become final, or pursuant to which, upon review thereof, the circuit court has entered a judgment that is in favor of the Department and that has become final, the bond filed pursuant to this Act shall thereupon be forfeited, and the Department may institute a suit upon such bond in its own name for the entire amount of such bond and costs. Such suit upon the bond shall be in addition to any other remedy provided for herein.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-155)
Sec. 1-155. Sunset of exemptions, credits, and deductions. The application of every exemption, credit, and deduction against tax imposed by this Act that becomes law after the effective date of this Act shall be limited by a reasonable and appropriate sunset date. A taxpayer is not entitled to take the exemption, credit, or deduction beginning on the sunset date and thereafter. If a reasonable and appropriate sunset date is not specified in the Public Act that creates the exemption, credit, or deduction, a taxpayer shall not be entitled to take the exemption, credit, or deduction beginning 5 years after the effective date of the Public Act creating the exemption, credit, or deduction and thereafter.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-160)
Sec. 1-160. Distribution of receipts by the Department. All moneys received by the Department under this Act shall be deposited into the Healthcare Provider Relief Fund.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-165)
Sec. 1-165. Exemption. Persons who are not operating cigarette machines as defined in this Act and are engaged in the business of renting, leasing or selling cigarette machines to persons are exempt from the provisions of this Act.
(Source: P.A. 97-688, eff. 6-14-12.)
(35 ILCS 128/1-170)
Sec. 1-170. Notice. Any person who distributes or offers for sale or rent a cigarette machine in this State shall provide notice to any potential purchaser, lessee, or lessor of that cigarette machine or any retail space containing a cigarette machine. The notice shall contain information about this Act, including: (i) licensure requirements for cigarette machine operators; (ii) tax collection and remittance duties of cigarette machine operators; (iii) any product limitations imposed on cigarette machines by this Act; and (iv) packaging and labeling requirements.
(Source: P.A. 97-688, eff. 6-14-12.)