Chapter 25 - Miscellaneous
Division 14 - Telecommunications Tax
SEC. 25.14-1 TITLE. This Division shall be known and cited as the “Town of Normal Telecommunications Tax Ordinance.” The tax imposed by this Division shall be known as the “telecommunications tax” and is imposed in addition to all other taxes imposed by the Town of Normal, the State of Illinois or any other municipal corporation or political subdivision thereof.
SEC. 25.14-2 DEFINITIONS. When any of the following words or terms are used in this Division whether or not capitalized, they shall have the meaning or construction ascribed them in this Section:
- City means the Town of Normal, Illinois.
- Department or Department of Finance means
the Department of Finance of the City.
- Director or Director of Finance means the
Director of Finance of the City.
- Amount paid means the amount charged to the taxpayer’s
service address located in the City regardless of where such
amount is billed or paid.
- Gross charge means the amount paid for the act or
privilege of originating or receiving telecommunications in
the City, and for all services rendered in connection therewith,
valued in money, whether paid in money or otherwise, including
cash, credits, services and property of every kind and nature,
and shall be determined without any deduction on account of
the cost of such telecommunications, the cost of materials used,
labor or service costs or any other expenses whatsoever. In
case credit is extended, the amount thereof shall be included
only as and when paid.
However, “gross charge” shall not include:
- Any amounts added to a purchaser’s bill because of a
charge made pursuant to:
- the tax imposed by this Division.
- additional charges added to a purchaser’s bill pursuant
to Section 9-222 of the Illinois Public Utilities Act.
- the tax imposed by the Illinois Telecommunications
Excise Tax Act;
- the tax imposed by Section 4251 of the United States
Internal Revenue Code; or
- the infrastructure maintenance fee imposed by Division
10 of Chapter 26 of this Code;
- the tax imposed by this Division.
- Charges for a sent collect telecommunication received
outside of the City.
- Charges for leased time on equipment or charges for
the storage of data or information or subsequent retrieval
or the processing of data or information intended to change
its form or content. This subdivision (E)(3) applies, but
is not limited, to the use of calculations, computers, data
processing equipment, tabulating equipment and accounting
equipment and also applies to the usage of computers under
a time-sharing agreement;
- Charges for customer equipment, including equipment
that is leased or rented by the customer from any source,
provided that such charges are disaggregated and separately
identified from other charges;
- Charges to business enterprises certified under Section
9-222.1 of the Illinois Public Utilities Act to the extent
of such exemption and during the period of time specified
by the Illinois Department of Commerce and Community Affairs;
- Charges for telecommunications and all services and
equipment provided in connection therewith between a parent
corporation and its wholly owned subsidiaries, or between
the wholly owned subsidiaries, when the tax imposed under
this Division previously was paid to a retailer, but only
to the extent that the charges between the parent corporation
and wholly owned subsidiaries, or between the wholly owned
subsidiaries, represent an expense allocation between the
corporations and not the generation of profit for the corporation
rendering such service;
- Bad debts; provided, however, that if any portion of
a debt deemed to be bad is subsequently paid, the retailer
shall report and pay the tax on that portion of the debt
paid during the reporting period; or
- Charges paid by inserting coins in coin-operated telecommunication
devices.
- Any amounts added to a purchaser’s bill because of a
charge made pursuant to:
- Bad debt means any portion of a debt that is related
to a sale at retail, for which gross charges are not otherwise
deductible or excludable, that has become worthless or uncollectible
as determined by applicable federal income tax standards.
- Interstate telecommunications means all telecommunications
originating in the City that terminate outside the State of
Illinois and all telecommunications originating outside the
State of Illinois which terminate in the City.
- Intrastate telecommunications means all telecommunications
originating in the City that terminate within the State of Illinois
and all telecommunications which originate within the State
of Illinois and terminate in the City.
- Person means any natural individual, firm, trust,
estate, partnership, association, joint stock company, joint
venture, corporation, limited liability company, or a receiver,
trustee, guardian or other representative appointed by order
of any court, the Federal or State governments, including State
universities created by a statute, or any city, town, county,
or other political subdivision of this State.
- Purchase at retail means the acquisition, consumption
or use of telecommunications through a sale at retail.
- Retailer means and includes every person engaged
in the business of making sales at retail as defined in subsection
(M) of this Section.
- Retailer maintaining a place of business in this state,
or any like designation, means and includes any retailer having
or maintaining within the State of Illinois, directly or by
a subsidiary, an office, distribution facilities, transmission
facilities, sales office, warehouse or other place of business,
or an agent or other representative operating within the State
of Illinois under the authority of the retailer or its subsidiary,
irrespective of whether such place of business, agent or other
representative is located in the State of Illinois permanently
or temporarily, or whether such retailer or subsidiary is licensed
to do business in Illinois.
- Sale at retail means the transmitting, supplying
or furnishing of telecommunications and all services rendered
in connection therewith for consideration:
- To persons other than the City, Federal and State governments,
and State universities created by statute; and
- Other than between a parent corporation and its wholly
owned subsidiaries, or between the wholly owned subsidiaries,
but only when the tax previously has been paid to a retailer
and the gross charge made by one such corporation to another
such corporation is not greater than the gross charge paid
to the retailer for their use or consumption and not for
resale.
- To persons other than the City, Federal and State governments,
and State universities created by statute; and
- Service address means the location of telecommunications
equipment from which telecommunications are originated or at
which telecommunications are received by a taxpayer. If this
location is not a defined location, as in the case of mobile
phones, paging systems, maritime systems, air-to-ground systems
and the like, “service address” shall mean the location of a
taxpayer’s primary use of the telecommunications equipment as
defined by telephone number, authorization code or location
in Illinois where bills are sent.
- Taxpayer means a person which individually, or through
its agents, employees or permittees, engages in the act or privilege
of originating telecommunications in the City or receiving telecommunications
in the City and that incurs a tax liability under this Division.
-
- Telecommunications, in addition to the usual
and popular meaning, includes, but is not limited to, messages
or information transmitted through use of local, toll and
wide area telephone service, private line services, channel
services, telegraph services, teletypewriter service, computer
exchange services, cellular mobile telecommunications service,
specialized mobile radio services, paging service or any
other form of mobile and portable one-way or two-way communications,
or any other transmission of messages or information by
electronic or similar means, between or among points by
wire, cable, fiber optics, laser, microwave, radio, satellite
or similar facilities.
- The definition of telecommunications set forth
in subsection (P)(1) shall not include:
- value-added services in which computer processing
applications are used to act on the form, content, code
and protocol of the information for purposes other than
transmission; or
- purchase of telecommunications by a telecommunications
service provider for use as a component part of the
service provided by it to the ultimate retail consumer
originating or terminating the taxable end-to-end telecommunications.
Carrier access charges, right of access charges, charges
for use of inter-company facilities, and all telecommunications
resold in Section 25.14-3(D) used as a component of,
or integrated into, end-to-end telecommunications service
shall be non-taxable as sales for resale.
- Prepaid telephone calling arrangements as defined
in Section 2-27 of the Retailers Occupation Tax Act
(35 ILCS 120/2-27).
- value-added services in which computer processing
applications are used to act on the form, content, code
and protocol of the information for purposes other than
transmission; or
- Telecommunications, in addition to the usual
and popular meaning, includes, but is not limited to, messages
or information transmitted through use of local, toll and
wide area telephone service, private line services, channel
services, telegraph services, teletypewriter service, computer
exchange services, cellular mobile telecommunications service,
specialized mobile radio services, paging service or any
other form of mobile and portable one-way or two-way communications,
or any other transmission of messages or information by
electronic or similar means, between or among points by
wire, cable, fiber optics, laser, microwave, radio, satellite
or similar facilities.
- Originating means initiating the transmission of messages or information and includes, but is not limited to, activating a mobile or portable telecommunications device for the purpose of sending or accepting messages or information.
- Beginning April 1, 2002, a tax is hereby imposed upon:
- The act or privilege of originating or receiving in
the city intrastate telecommunications by a person at a
rate of five percent (5%) of the gross charge for such telecommunications
purchased at retail from a retailer and charged to a service
address in the City; and
- The act or privilege of originating or receiving in
the city interstate telecommunications by a person at a
rate of five percent (5%) of the gross charge for such telecommunications
purchased at retail from a retailer and charged to a service
address in the City.
- The act or privilege of originating or receiving in
the city intrastate telecommunications by a person at a
rate of five percent (5%) of the gross charge for such telecommunications
purchased at retail from a retailer and charged to a service
address in the City; and
- To prevent actual multi-state taxation of the act or privilege
that is subject to taxation under subsection (A)(2) of this
section, any taxpayer, upon proof that the taxpayer has paid
a municipal tax in another state on the same event, shall be
allowed a credit against the tax authorized by subsection (A)(2)
to the extent of the amount of such municipal tax properly due
and paid in such other state which was not previously allowed
as a credit against the tax imposed by this Division.
- The tax imposed by this Division is not imposed on any act
or privilege to the extent that such act or privilege may not,
under the Constitution or statutes of the United States, be
made the subject of taxation by the City.
- Carrier access charges, right of access charges, charges for use of inter-company facilities and all telecommunications resold in the subsequent provision of, used as a component of or integrated into end-to-end telecommunications service are sales for resale and are not subject to the tax imposed by this Division.
SEC. 25.14-4 COLLECTION OF TAX BY RETAILERS.
-
- Any retailer maintaining a place of business in this
state and making or effectuating a sale at retail shall
collect the tax imposed by this Division from the taxpayer
and remit it to the department as provided by Section 25.14-5
of this Division.
- Any tax required to be collected pursuant to this Division
and any tax collected by retailer shall constitute a debt
owed by the retailer to the City.
- The retailer shall collect the tax from the taxpayer
by adding the tax to the gross charge for the act or privilege
of originating telecommunications when sold for use in the
manner prescribed by this Division.
- The tax imposed by this Division shall constitute a
debt of the purchaser to the retailer providing taxable
services until paid and, if unpaid, is recoverable at law
in the same manner as the original charge for taxable services.
- Any retailer maintaining a place of business in this
state and making or effectuating a sale at retail shall
collect the tax imposed by this Division from the taxpayer
and remit it to the department as provided by Section 25.14-5
of this Division.
- The Director shall, upon application, authorize the collection
of this tax by any retailer not maintaining a place of business
in this state who, to the satisfaction of the Director, furnishes
adequate security to ensure collection and payment of the tax.
Such retailer shall be issued, without charge, a permit to collect
the tax imposed by this Division. When so authorized, it shall
be the duty of the retailer to collect the tax upon all of the
gross charges for telecommunications originated in the City
in the same manner, and subject to the same requirements, as
a retailer maintaining a place of business in this state.
- The tax authorized by this Division shall, when collected,
be stated as a distinct item separate and apart from the gross
charge for telecommunications.
- Retailers may retain 1.75 percent of the tax they collect to reimburse them for expenses incurred in connection with collecting and remitting the tax, less any charge allowed by the Illinois Commerce Commission that permits them to recover such expenses. This commission shall not be allowed for taxes not timely remitted to the department.
SEC. 25.14-5 FILING RETURNS AND REMITTANCES BY RETAILERS. On or before the 15th day of each calendar month, every retailer maintaining a place of business in this state and every retailer authorized by the Director to collect the tax imposed by this Division shall file with the department a remittance return and remit all applicable tax for the preceding calendar month. The return shall be filed on a form prescribed by the Director, containing such information as the Director may reasonably require.
SEC. 25.14-6 REGISTRATION. Every retailer maintaining a place of business in this state shall register with the department within thirty (30) days after the effective date of this Division or the date of becoming such a retailer, whichever is later.
SEC. 25.14-7 OBLIGATION OF TAXPAYERS TO FILE RETURNS AND PAY TAX.
- If a retailer fails to collect the tax imposed by this Division
from a taxpayer, as required by Section 25.14-4, then the taxpayer
shall pay the tax directly to the department.
- On or before the 15th day of each calendar month, every taxpayer that has not paid the tax imposed by this Division to a retailer shall file with the department a tax return and pay the tax upon the gross charges the taxpayer paid to the retailer during the preceding calendar month. The return shall be filed on a form prescribed by the Director, containing such information as the Director may reasonably require.
- If a person who originates telecommunications in the City
claims to be a reseller of telecommunications, that person shall
apply to the department for a resale number. The applicant shall
state facts showing why it is not liable for the tax imposed
by this Division on any purchases of telecommunications and
shall furnish such additional information as the department
may reasonably require.
- Upon approval of the application, the department shall assign
a resale number to the applicant and shall certify the number
of the applicant.
- The department may cancel the resale number of any person
if the number:
- was obtained through misrepresentation;
- is used to originate telecommunications tax-free when
such telecommunications are not for resale; or
- is no longer necessary because the person has discontinued
making resales.
- was obtained through misrepresentation;
- The act or privilege of originating telecommunications in the City shall not be made tax-free on the ground of being a sale for resale unless the person has an active resale number issued by the department and furnishes that number to the retailer in connection with certifying to the retailer that a sale is nontaxable as a sale for resale.
SEC. 25.14-9 MAINTAINING BOOKS AND RECORDS. Every retailer maintaining a place of business in this state, every retailer authorized by the Director to collect the tax imposed by this Division and every taxpayer required by Section 25.14-7 to pay the tax directly to the department shall keep accurate books and records of its business or activity, including original source documents and books of entry denoting the transactions that gave rise, or may have given rise, to any tax liability or exemption. All such books and records shall be kept in the English language and, at all times during business hours of the day, shall be subject to and available for inspection and audit by the department.
SEC. 25.14-10 RULES AND REGULATIONS. The Director is authorized to adopt, promulgate and enforce rules and regulations pertaining to the administration and enforcement of this Division.
SEC. 25.14-11 SEVERABILITY. If any provision of this Division, or the application of any provision of this Division, is held unconstitutional or otherwise invalid, such occurrence shall not affect other provisions of this Division, or their application, that can be given effect without the unconstitutional or invalid provision or its application. Each unconstitutional or invalid provision, or application of such provision, is severable, unless otherwise provided by this Division. In particular, if subsection (A)(2) of Section 25.14-3 of this Division is declared unconstitutional or otherwise invalid, the tax imposed under Section (A)(1) of Section 25.14-3 shall remain in full force and effect.
SEC. 25.14-12 STATUS OF ILLINOIS MUNICIPAL CODE SECTION 8-11-17. If Section 8-11-7 of the Illinois Municipal Code is repealed, or becomes ineffective for any reason, then Division 6 of Chapter 25 of the Town of Normal Municipal Code (insofar as Division 6 is applicable to persons engaged in the business of transmitting messages by means of electricity, or radio magnetic waves or fiber optics) declared ineffective in favor of this Article, shall be deemed to be in full force and effect as of the date Section 8-11-17 is repealed or becomes ineffective during such time that Section 8-11-17 is not in effect. This Division shall be in full force and effect at any time that Section 8-11-17 is deemed to be in effect or authorizes the imposition of the tax imposed under this Division. Provided, however, in the event Section 8-11-17 of the Illinois Municipal Code is repealed or becomes ineffective due to imposition of a substitute telecommunications tax collected by the state and remitted to municipalities, then it is the intent of the Normal Town Council to convert to such new state tax based on the telecommunications tax imposed by this Division rather than the Gross Receipts Utility Tax provided in Division 6 of this Chapter.
SEC. 25.14-13 PENALTY. Any retailer or taxpayer who fails to make a return, or who makes a fraudulent return, or who willfully violates any other provision of this Division shall, upon conviction, be fined not less than One Hundred Dollars ($100.00) nor more than One Thousand Dollars ($1,000.00) and in addition shall be liable in a civil action for the amount of tax due. A separate offense shall be deemed committed on each day during or on which a violation occurs or continues.
SEC. 25.14-14 LATE PAYMENT FEE. Any retailer or taxpayer who fails to file a return on time or remit payment of any tax due on time shall be liable for and pay a late payment fee as assessed by the Director up to One Hundred Dollars ($100.00) per day. The late payment fee shall be in addition to any penalty imposed pursuant to Section 25.14-13 and shall constitute a debt owed to the City.
SEC. 25.14-15 OVERPAYMENT OF TAX. If it shall appear that an amount of tax has been paid which was not due under the provisions of this division, whether as the result of a mistake of fact or an error of law, then such amount shall be credited against any tax due, or to become due, under the division from the taxpayer who made the erroneous payment; provided that no amounts erroneously paid more than three (3) years prior to the filing of a claim therefor shall be so credited.
(Entire Division 14 of Chapter 25 Added 2/18/02 by Ord. No. 4775)