CHAPTER 19
TAXATION
Sec. 19-1. A tax is hereby imposed upon all persons engaged in the business of selling tangible personal property at retail in this Village at the rate of one percent of the gross receipts from such sales made in the course of such business while this Ordinance is in effect, in accordance with the provisions of Section 8-11-1 of the Illinois Municipal Code.
Sec. 19-2. Every such person engaged in such business in the Village shall file on or before the last day of each calendar month the report to the State Department of Revenue required by Section Three of “An Act in Relation to a Tax upon Persons Engaged in the Business of Selling Tangible Personal Property to Purchasers for Use or Consumption” approved June 28, 1933, as amended.
Sec. 19-3. At the time such report is filed, there shall be paid to the State Department of Revenue the amount of tax hereby imposed on account of the receipts from sales of tangible personal property during the preceding month.
Sec. 19-4 through 19-9. Reserved.
Sec. 19-10. MUNICIPAL UTILITY TAX.
A. TAX IMPOSED.
(a) A tax is imposed on all persons engaged in the following occupations or privileges:
The privilege of using or consuming electricity acquired in a purchase at retail and used or consumed within the corporate limits of the municipality at the following rates, calculated on a monthly basis for each purchaser:
(i) For the first 2,000 kilowatt-hours used or consumed in a month; .335 cents per kilowatt-hour;
(ii) For the next 48,000 kilowatt-hours used or consumed in a month; .220 cents per kilowatt-hour;
(iii) For the next 50,000 kilowatt-hours used or consumed in a month; .198 cents per kilowatt-hour;
(iv) For the next 400,000 kilowatt-hours used or consumed in a month; .192 cents per kilowatt-hour;
(v) For the next 500,000 kilowatt-hours used or consumed in a month; .187 cents per kilowatt-hour;
(vi) For the next 2,000,000 kilowatt-hours used or consumed in a month; .176 cents per kilowatt-hour;
(vii) For the next 2,000,000 kilowatt-hours used or consumed in a month; .173 cents per kilowatt-hour;
(viii) For the next 5,000,000 kilowatt-hours used or consumed in a month; .170 cents per kilowatt-hour;
(ix) For the next 10,000,000 kilowatt-hours used or consumed in a month; .167 cents per kilowatt-hour; and
(x) For all electricity used or consumed in excess of 20,000,000 kilowatt-hours in a month; .165 cents per kilowatt-hour.
The tax rates set forth in the preceding table will be used at least through December 31, 2008, and are proportional to the rates enumerated in 65 ILCS § 5/8-11-2 (as modified by Public Act 90-561).
(b) Pursuant to 65 ILCS § 5/8-11-2, the rates set forth in subsection (a) above shall be effective: (A) on August 1, 1999, for residential customers; and (B) on the earlier of (1) the first bill issued on or after January 1, 2001, or (2) the date of the first bill issued pursuant to 220 ILCS § 5/16-104, for nonresidential customers.
(c) The provisions of Section 3.1 shall not be effective until August 1, 1998.
B. EXCEPTIONS. None of the taxes authorized by this Ordinance may be imposed with respect to any transaction in interstate commerce or otherwise to the extent to which the business or privilege may not, under the Constitution and statutes of the United States, be made the subject of taxation by this State or any political sub-division thereof; nor shall any persons engaged in business of distributing, supplying, furnishing, or selling or transmitting gas, water or electricity, or engaged in the business of transmitting messages, or using or consuming electricity acquired in a purchase at retail, be subject to taxation under the provisions of this Ordinance for those transactions that are or may become subject to taxation under the provisions of the “Municipal Retailers’ Occupation Tax Act” authorized by Section 8-11-1; nor shall any tax authorized by this Ordinance be imposed upon any person engaged in a business or on any privilege unless the tax is imposed in like manner and at the same rate upon all persons engaged in businesses of the same class in the municipality, whether privately or municipally owned or operated, or exercising the same privilege within the municipality.
(C) ADDITIONAL TAXES. Such tax shall be in addition to other taxes levied upon the taxpayer or its business.
(D) COLLECTION. The tax authorized by this Ordinance shall be collected from the purchaser by the person maintaining a place of business in this State who delivers the electricity to the purchaser. This tax shall constitute a debt of the purchaser to the person who delivers the electricity to the purchaser and, if unpaid, is recoverable in the same manner as the original charge for delivering the electricity. Any tax required to be collected pursuant to this Ordinance and any such tax collected by a person delivering electricity shall constitute a debt owed to the municipality by such person delivering the electricity. Persons delivering electricity shall collect the tax from the purchaser by adding such tax to the gross charge for delivering the electricity. Persons delivering electricity shall also be authorized to add to such gross charge an amount equal to 3% of the tax to reimburse the person delivering electricity for the expense incurred in keeping records, billing customers, preparing and filing returns, remitting the tax, and supplying data to the municipality upon request. If the person delivering electricity fails to collect the tax from the purchaser, then the purchaser shall be required to pay the tax directly to the municipality in the manner prescribed by the municipality. Persons delivering electricity who file returns pursuant to this Section (C) shall, at the time of filing such return, pay the municipality the amount of the tax collected pursuant to this Ordinance, provided that the person delivering electricity shall be allowed a credit for such tax related to deliveries of electricity the charges for which are written off as uncollectible, and provided further, that if such charges are thereafter collected, the delivering supplier shall be obligated to remit such tax.
(E) REPORTS TO MUNICIPALITY. On or before the last day of each month, each taxpayer shall make a return to the City for the preceding month stating:
(1) His name.
(2) His principal place of business.
(3) His gross receipts and/or kilowatt-hour usage during the month upon the basis of which the tax is imposed.
(4) Amount of tax.
(5) Such other reasonable and related information as the corporate authorities may require. The taxpayer making the return herein provided for shall, at the time of making such return, pay to the Village of New Milford, Illinois, the amount of tax herein imposed; provided that in connection with any return, the taxpayer may, if he so elects, report and pay an amount based upon his total billings of business subject to the tax during the period for which the return is made (exclusive of any amounts previously billed) with prompt adjustments of later payments based upon any differences between such billings, and the taxable gross receipts.
(F) CREDIT FOR OVER-PAYMENT. If it appears that an amount of tax has been paid which was not due under the provisions of this Article, 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 Article 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, therefore, shall be so credited. No action to recover any amount of tax due under the provisions of this Article shall be commenced more than three (3) years after the due date of such amount.
(G) PENALTY. Any taxpayer who fails to make a return, who makes a fraudulent return, or who willfully violates any other provision of this Article is guilty of a misdemeanor and, upon conviction thereof, shall be fined not less than One Hundred Dollars ($100.00) nor more than Two Hundred Dollars ($200.00) in addition, shall be liable in a civil action for the amount of tax due. (See 65 ILCS 5/8-11-2)
Sec. 19-11 through 19-19. Reserved.
Sec. 19-20. DEFINITIONS.
As used in this Chapter, the following terms shall have the following meanings:
(a) “Amount paid” means the amount charged to the taxpayer’s service address in this municipality regardless of
where such an amount is billed or paid.
(b) “Department” means the Illinois Department of Revenue.
(c) “Gross charge” means the amount paid for the act or privilege of originating or receiving telecommunications in this municipality and for all services and equipment provided in connection therewith by a retailer, valued in money, whether paid in money or otherwise, including cash, credits, services and property of every kind or nature, and shall be determined without any deduction on account of the cost of such telecommunications, the cost of the materials used, labor or service costs or any other expense whatsoever. In case credit is extended, the amount thereof shall be included only as and when paid. “Gross charges” for private line service shall include charges imposed at each channel termination point within a municipality that has imposed a tax under this Chapter and
charges for the portion of the inter-office channels provided within that municipality. Changes for that portion of the inter-office channel connecting two or more channel termination points, one or more of which is located within the jurisdictional boundary of such municipality, shall be determined by the retailer by multiplying an amount equal to the total charge for the inter-office channel by a fraction, the numerator of which is the number of channel termination points that are located within the jurisdictional boundary of the municipality and the denominator of which is the total number of channel termination points connected by the inter-office channel. However, “gross charge” shall not include any of the following:
(1) Any amounts added to the purchaser’s bill because of a charge made pursuant to (i) the tax imposed by this Ordinance, (ii) the tax imposed by the Telecommunications Excise Tax Act, (iii) the tax imposed by Section 4251 of the Internal Revenue Code, (iv) 911 surcharges, or (v) charges added to customers’ bills pursuant to the provisions of Section 9-221 or 9-222 of the Public Utilities Act, as amended, or any similar charges added to customers’ bills by retailers who are not subject to rate regulation by the Illinois Commerce Commission for the purpose of recovering any of the tax liabilities or other amounts specified in those provisions of the Public Utilities Act.
(2) Charges for a sent collect telecommunication received outside of such municipality.
(3) Charges for leased time on equipment or charges for the storage of data or information for subsequent retrieval or the processing of data or information intended to change its form or content. Such equipment includes, but is not limited to, the use of calculators, computers, data processing equipment, tabulating equipment, or accounting equipment and also includes the usage of computers under a time-sharing agreement.
(4) Charges for customer equipment, including such equipment that is leased or rented by the customer from any source, wherein such charges are disaggregated and separately identified from other charges.
(5) Charges to business enterprises certified as exempt under Section 9-222.1 of the Public Utilities Act to the extent of such exemption and during the period of time specified by the Department of Commerce and Community Affairs.
(6) Charges for telecommunications and all services and equipment provided in connection therewith between a parent corporation and its wholly owned subsidiaries or between wholly owned subsidiaries when the tax imposed under this Ordinance has already been paid to a retailer and only to the extent that the charges between the parent corporation and wholly owned subsidiaries or between wholly owned subsidiaries represent expense allocation between the corporations and not the generation of profit for the corporation rendering such service.
(7) Bad debts (“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 under applicable federal income tax standards; if the portion of the debt deemed to be bad is subsequently paid, the retailer shall report and pay the tax on that portion during the reporting period in which the payment is made).
(8) Charges are paid by inserting coins in coin-operated telecommunications devices.
(9) Amounts paid by telecommunications retailers under the Telecommunications Infrastructure Maintenance Fee Act.
(10) Charges for nontaxable services or telecommunications if (i) those charges are aggregated with other charges for telecommunications that are taxable, (ii) those charges are not separately stated on the customer bill or invoice, and (iii) the retailer can reasonably identify the nontaxable charges on the retailer’s books and records kept in the regular course of business. If the nontaxable charges cannot reasonably be identified, the gross charge from the sale of both taxable and nontaxable services or telecommunications billed on a combined basis shall be attributed to the taxable services or telecommunications. The burden of proving nontaxable charges shall be on the retailer of the telecommunications.
(d) “Interstate telecommunications” means all telecommunications that either originate or terminate outside this State.
(e) “Intrastate telecommunications” means all telecommunications that originate and terminate within this State.
(f) “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 and State governments, including State universities created by statute, or any city, town, county, or other political subdivision of this State.
(g) “Purchase at retail” means the acquisition, consumption, or use of telecommunications through a sale at retail.
(h) “Retailer” means and includes every person engaged in the business of making sales at retail as defined in this Section. The Department may, in its discretion, upon application, authorize the collection of the tax hereby imposed by any retailer not maintaining a place of business within this State, who, to the satisfaction of the Department, furnishes adequate security to ensure collection and payment of the tax. Such retailers shall be issued, without charge, a permit to collect such tax. When so authorized, it shall be the duty of such retailer to collect the tax upon all of the gross charges for telecommunications in this State in the same manner and subject to the same requirements as a retailer maintaining a place of business within this State. The permit may be revoked by the Department at its discretion.
(i) “Retailer maintaining a place of business in this State,” or any like term, means and includes any retailer having or maintaining within this State, directly or by a subsidiary, an office, distribution facilities, transmission facilities, sales office, warehouse or other places of business, or any agent or other representative operating within this State under the authority of the retailer or its subsidiary, irrespective of whether such place of business or agent or other representative is located here permanently or temporarily, or whether such retailer or subsidiary is licensed to do business in this State.
(j) “Sale at retail” means the transmitting, supplying, or furnishing of telecommunications and all services and equipment provided in connection therewith for consideration to persons other than the Federal and State governments and State universities created by statute and other than between a parent corporation and its wholly owned subsidiaries or between wholly owned subsidiaries for their use or consumption and not for resale.
(k) “Service address” means the location of telecommunications equipment from which telecommunications services originated or at which telecommunications services are received by a taxpayer. In the event that this may not be a defined location, as in the case of mobile phones, paging systems, and maritime systems, service address means the customer’s place of primary use as defined in the Mobile Telecommunications Sourcing Conformity Act. For 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.
(l) “Taxpayer” means a person who individually or through his or her agents, employees, or permittees engages in the act or privilege of originating or receiving telecommunications in a municipality and who incurs a tax liability as authorized by the Ordinance.
(m) “Telecommunications,” in addition to the meaning ordinarily and popularly ascribed to it, includes, without limitation, messages or information transmitted through the use of local, toll, and wide area telephone service, private line services, channel services, telegraph services, teletypewriter, computer exchange services, cellular mobile telecommunications service, specialized mobile radio, stationary two-way radio, paging service, or any other form of a 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. As used in this Ordinance, “private line” means a dedicated non-traffic sensitive service for a single customer that entitles the customer to exclusive or priority use of a communications channel or group of channels, from one or more specified locations to one or more other specified locations. The definition of
“telecommunications” 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. “Telecommunications” shall not include purchases of telecommunications by a telecommunications service provider for use as a component part of the service provided by such provider to the ultimate retail consumer who originates or terminates the taxable end-to-end communications. 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 shall be non-taxable as sales for resale. Prepaid telephone calling arrangements shall not be considered “telecommunications” subject to the tax imposed under this Ordinance. For purposes of this Section, “prepaid telephone calling arrangements” means that term as defined in Section 2-27 of the Retailer’s Occupation Tax Act.
19-21. SIMPLIFIED MUNICIPAL TELECOMMUNICATIONS TAX IMPOSED.
A tax is hereby imposed upon any and all the following acts or privileges:
(a) The act or privilege of originating in the municipality or receiving in the municipality intrastate telecommunications by a person at a rate of six percent (6.0%) of the gross charge for such telecommunications purchased at retail from a retailer. To prevent actual multi-municipal taxation of the act or privilege that is subject to taxation under this subsection, any taxpayer, upon proof that the taxpayer has paid a tax in another municipality on that event, shall be allowed a credit against any tax enacted pursuant to or authorized by this Section to the extent of the amount of the tax property due and paid in the municipality that was not previously allowed as a credit against any other municipal tax.
(b) The act or privilege of originating in the municipality or receiving in the municipality interstate telecommunications by a person at a rate of six percent (6.0%) of the gross charge for such telecommunications purchased at retail from a retailer. To prevent actual multi-state or multi-municipal taxation of the act or privilege that is subject to taxation under this subsection, any taxpayer, upon proof that the taxpayer has paid a tax in another state or municipality on this State on such event, shall be allowed a credit against any tax enacted pursuant to or authorized by this Section to the extent of the amount of such tax properly due and paid in such other state of such tax properly due and paid in a municipality in this State which was not previously allowed as a credit against any other state or local tax in this State.
(c) The tax imposed by this Ordinance is not imposed on such act or privilege to the extent such act or privilege may not, under the Constitution and statutes of the United States, be made the subject of taxation by the municipality.
19-22. COLLECTION OF TAX BY RETAILERS.
(a) The tax authorized by this Ordinance shall be collected from the taxpayer by a retailer maintaining a place of business in this State and shall be remitted by such retailer to the Department. Any tax required to be collected pursuant to or as authorized by this Ordinance and any such tax collected by such retailer and required to be remitted to the Department shall constitute a debt owed by the retailer to the State. Retailers shall collect the tax from the taxpayer by adding the tax to the gross charge for the act or privilege of originating or receiving telecommunications when sold for use in the manner prescribed by the Department. The tax authorized by this Ordinance shall constitute a debt of the taxpayer to the retailer until paid and, if unpaid, is recoverable at law in the same manner as the original charge for such sale at retail. If the retailer fails to collect the tax from the taxpayer, then the taxpayer shall be required to pay the tax directly to the Department in the manner provided by the Department.
(b) Whenever possible, the tax authorized by this Ordinance shall, when collected, be stated as a distinct item separate and apart from the gross charge for telecommunications.
19-23. RETURNS TO DEPARTMENT.
On or before the last day of August 2005, and on or before the last day of every month thereafter, the tax imposed under this Ordinance on telecommunication retailers shall be returned with appropriate forms and information as required by the Department pursuant to the Illinois Simplified Municipal Telecommunications Tax Act (Public Act 92-526, Section 5-50) and any accompanying rules and regulations created by the Department to implement the Act.
19-24. RESELLERS.
(a) if a person who originates or receives telecommunications claims to be a reseller of such telecommunications, such person shall apply to the Department for a resale number. Such applicant shall state facts which will show the Department why such applicant is not liable for the tax authorized by this Article on any of such purchases and shall furnish such additional information as the Department may reasonably require.
(b) Upon approval of the application, the Department shall assign a resale number to the applicant and shall certify such number to the applicant. The Department may cancel any number which is obtained through misrepresentation or which is used to send or receive such telecommunication tax-free when such actions, in fact, are not for resale or which no longer apply because of the person’s having discontinued the making of resales.
(c) Except as provided hereinabove in this Section, the act or privilege of originating or receiving telecommunications in this State shall not be made tax-free on the ground of being a sale for resale unless the person has an active resale number from the Department and furnishes that number to the retailer in connection with certifying to the retailer that any sale to such person is non-taxable because of being a sale for resale.
19-25. SEVERABILITY.
If any provision of this Ordinance, or the application of any provision of this Ordinance, is held unconstitutional or otherwise invalid, such occurrence shall not affect other provisions of this Ordinance, 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 Ordinance.
19-26. EFFECTIVE DATE.
This Ordinance shall be in full force and effect from and after its passage and approval and publication as required by law, provided, however, that the tax provided for herein shall take effect for all bills issued on or after the first day of July 2005. Copies of this Ordinance shall be certified and sent to the Illinois Department of Revenue prior to March 20, 2005.
REFERENCES
Village of New Milford. “CODE OF ORDINANCES VILLAGE OF NEW MILFORD.” The Village of New Milford, Sept. 2021, villageofnewmilford.com//wp-content/uploads/2022/07/New-Milford-Code-of-Ordinances-September-2021.pdf.
