USE/OCC TAX-HOLIDAY

Illinois General Assembly - Full Text of HB4101

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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB4101

Introduced 10/15/2025, by Rep. Maurice A. West, II

SYNOPSIS AS INTRODUCED:

35 ILCS 105/3-6
35 ILCS 105/3-10

from Ch. 120, par. 439.33-10
35 ILCS 120/2-8
35 ILCS 120/2-10

from Ch. 120, par. 441-10

Amends the Use Tax Act and the Retailers' Occupation Tax Act. Provides
that the sales tax holiday period under those Acts applies from August 5
through August 14 of 2026 and from August 5 through August 14 of each year
thereafter. Effective immediately.
LRB104 14805 HLH 27948 b

A BILL FOR

HB4101
LRB104 14805 HLH 27948 b
1

AN ACT concerning revenue.

2

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

4

Section 5.
The Use Tax Act is amended by changing Sections
5
3-6 and 3-10 as follows:

6

(35 ILCS 105/3-6)
7

Sec. 3-6.
Sales tax holiday items.
8

(a) Any tangible personal property described in this
9
subsection is a sales tax holiday item and qualifies for the
10
1.25% reduced rate of tax
during

for
the
period set forth in
11
Section 3-10 of this Act (hereinafter referred to as the
Sales
12
Tax Holiday Period
)
. The reduced rate on these items shall be
13
administered under the provisions of subsection (b) of this
14
Section. The following items are subject to the reduced rate:
15

(1) Clothing items that each have a retail selling
16

price of less than $125.
17

"Clothing" means, unless otherwise specified in this
18

Section, all human wearing apparel suitable for general
19

use. "Clothing" does not include clothing accessories,
20

protective equipment, or sport or recreational equipment.
21

"Clothing" includes, but is not limited to: household and
22

shop aprons; athletic supporters; bathing suits and caps;
23

belts and suspenders; boots; coats and jackets; ear muffs;

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1

footlets; gloves and mittens for general use; hats and
2

caps; hosiery; insoles for shoes; lab coats; neckties;
3

overshoes; pantyhose; rainwear; rubber pants; sandals;
4

scarves; shoes and shoelaces; slippers; sneakers; socks
5

and stockings; steel-toed shoes; underwear; and school
6

uniforms.
7

"Clothing accessories" means, but is not limited to:
8

briefcases; cosmetics; hair notions, including, but not
9

limited to barrettes, hair bows, and hair nets; handbags;
10

handkerchiefs; jewelry; non-prescription sunglasses;
11

umbrellas; wallets; watches; and wigs and hair pieces.
12

"Protective equipment" means, but is not limited to:
13

breathing masks; clean room apparel and equipment; ear and
14

hearing protectors; face shields; hard hats; helmets;
15

paint or dust respirators; protective gloves; safety
16

glasses and goggles; safety belts; tool belts; and
17

welder's gloves and masks.
18

"Sport or recreational equipment" means, but is not
19

limited to: ballet and tap shoes; cleated or spiked
20

athletic shoes; gloves, including, but not limited to,
21

baseball, bowling, boxing, hockey, and golf gloves;
22

goggles; hand and elbow guards; life preservers and vests;
23

mouth guards; roller and ice skates; shin guards; shoulder
24

pads; ski boots; waders; and wetsuits and fins.
25

(2) School supplies. "School supplies" means, unless
26

otherwise specified in this Section, items used by a

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1

student in a course of study. The purchase of school
2

supplies for use by persons other than students for use in
3

a course of study are not eligible for the reduced rate of
4

tax. "School supplies" do not include school art supplies;
5

school instructional materials; cameras; film and memory
6

cards; videocameras, tapes, and videotapes; computers;
7

cell phones; Personal Digital Assistants (PDAs); handheld
8

electronic schedulers; and school computer supplies.
9

"School supplies" includes, but is not limited to:
10

binders; book bags; calculators; cellophane tape;
11

blackboard chalk; compasses; composition books; crayons;
12

erasers; expandable, pocket, plastic, and manila folders;
13

glue, paste, and paste sticks; highlighters; index cards;
14

index card boxes; legal pads; lunch boxes; markers;
15

notebooks; paper, including loose leaf ruled notebook
16

paper, copy paper, graph paper, tracing paper, manila
17

paper, colored paper, poster board, and construction
18

paper; pencils; pencil leads; pens; ink and ink refills
19

for pens; pencil boxes and other school supply boxes;
20

pencil sharpeners; protractors; rulers; scissors; and
21

writing tablets.
22

"School art supply" means an item commonly used by a
23

student in a course of study for artwork and includes only
24

the following items: clay and glazes; acrylic, tempera,
25

and oil paint; paintbrushes for artwork; sketch and
26

drawing pads; and watercolors.

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"School instructional material" means written material
2

commonly used by a student in a course of study as a
3

reference and to learn the subject being taught and
4

includes only the following items: reference books;
5

reference maps and globes; textbooks; and workbooks.
6

"School computer supply" means an item commonly used
7

by a student in a course of study in which a computer is
8

used and applies only to the following items: flashdrives
9

and other computer data storage devices; data storage
10

media, such as diskettes and compact disks; boxes and
11

cases for disk storage; external ports or drives; computer
12

cases; computer cables; computer printers; and printer
13

cartridges, toner, and ink.
14

(b) Administration. Notwithstanding any other provision of
15
this Act, the reduced rate of tax under Section 3-10 of this
16
Act for clothing and school supplies shall be administered by
17
the Department under the provisions of this subsection (b).
18

(1) Bundled sales. Items that qualify for the reduced
19

rate of tax that are bundled together with items that do
20

not qualify for the reduced rate of tax and that are sold
21

for one itemized price will be subject to the reduced rate
22

of tax only if the value of the items that qualify for the
23

reduced rate of tax exceeds the value of the items that do
24

not qualify for the reduced rate of tax.
25

(2) Coupons and discounts. An unreimbursed discount by
26

the seller reduces the sales price of the property so that

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LRB104 14805 HLH 27948 b
1

the discounted sales price determines whether the sales
2

price is within a sales tax holiday price threshold. A
3

coupon or other reduction in the sales price is treated as
4

a discount if the seller is not reimbursed for the coupon
5

or reduction amount by a third party.
6

(3) Splitting of items normally sold together.
7

Articles that are normally sold as a single unit must
8

continue to be sold in that manner. Such articles cannot
9

be priced separately and sold as individual items in order
10

to obtain the reduced rate of tax. For example, a pair of
11

shoes cannot have each shoe sold separately so that the
12

sales price of each shoe is within a sales tax holiday
13

price threshold.
14

(4) Rain checks. A rain check is a procedure that
15

allows a customer to purchase an item at a certain price at
16

a later time because the particular item was out of stock.
17

Eligible property that customers purchase during the Sales
18

Tax Holiday Period with the use of a rain check will
19

qualify for the reduced rate of tax regardless of when the
20

rain check was issued. Issuance of a rain check during the
21

Sales Tax Holiday Period will not qualify eligible
22

property for the reduced rate of tax if the property is
23

actually purchased after the Sales Tax Holiday Period.
24

(5) Exchanges. The procedure for an exchange in
25

regards to a sales tax holiday is as follows:
26

(A) If a customer purchases an item of eligible

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LRB104 14805 HLH 27948 b
1

property during the Sales Tax Holiday Period, but
2

later exchanges the item for a similar eligible item,
3

even if a different size, different color, or other
4

feature, no additional tax is due even if the exchange
5

is made after the Sales Tax Holiday Period.
6

(B) If a customer purchases an item of eligible
7

property during the Sales Tax Holiday Period, but
8

after the Sales Tax Holiday Period has ended, the
9

customer returns the item and receives credit on the
10

purchase of a different item, the 6.25% general
11

merchandise sales tax rate is due on the sale of the
12

newly purchased item.
13

(C) If a customer purchases an item of eligible
14

property before the Sales Tax Holiday Period, but
15

during the Sales Tax Holiday Period the customer
16

returns the item and receives credit on the purchase
17

of a different item of eligible property, the reduced
18

rate of tax is due on the sale of the new item if the
19

new item is purchased during the Sales Tax Holiday
20

Period.
21

(6) (Blank).
22

(7) Order date and back orders. For the purpose of a
23

sales tax holiday, eligible property qualifies for the
24

reduced rate of tax if: (i) the item is both delivered to
25

and paid for by the customer during the Sales Tax Holiday
26

Period or (ii) the customer orders and pays for the item

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1

and the seller accepts the order during the Sales Tax
2

Holiday Period for immediate shipment, even if delivery is
3

made after the Sales Tax Holiday Period. The seller
4

accepts an order when the seller has taken action to fill
5

the order for immediate shipment. Actions to fill an order
6

include placement of an "in date" stamp on an order or
7

assignment of an "order number" to an order within the
8

Sales Tax Holiday Period. An order is for immediate
9

shipment when the customer does not request delayed
10

shipment. An order is for immediate shipment
11

notwithstanding that the shipment may be delayed because
12

of a backlog of orders or because stock is currently
13

unavailable to, or on back order by, the seller.
14

(8) Returns. For a 60-day period immediately after the
15

Sales Tax Holiday Period, if a customer returns an item
16

that would qualify for the reduced rate of tax, credit for
17

or refund of sales tax shall be given only at the reduced
18

rate unless the customer provides a receipt or invoice
19

that shows tax was paid at the 6.25% general merchandise
20

rate, or the seller has sufficient documentation to show
21

that tax was paid at the 6.25% general merchandise rate on
22

the specific item. This 60-day period is set solely for
23

the purpose of designating a time period during which the
24

customer must provide documentation that shows that the
25

appropriate sales tax rate was paid on returned
26

merchandise. The 60-day period is not intended to change a

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LRB104 14805 HLH 27948 b
1

seller's policy on the time period during which the seller
2

will accept returns.
3

(c) The Department may implement the provisions of this
4
Section through the use of emergency rules, along with
5
permanent rules filed concurrently with such emergency rules,
6
in accordance with the provisions of Section 5-45 of the
7
Illinois Administrative Procedure Act. For purposes of the
8
Illinois Administrative Procedure Act, the adoption of rules
9
to implement the provisions of this Section shall be deemed an
10
emergency and necessary for the public interest, safety, and
11
welfare.
12

(d) As used in this Section:

13

"Sales Tax Holiday Period" means:

14

(1) August 6, 2010 through August 15, 2010;
15

(2) August 5, 2022 through August 14, 2022;

16

(3) August 5, 2026 through August 14, 2026; and
17

(4) August 5 through August 14 of each year
18

thereafter.

19

(e) This Section is exempt from the provisions of Section
20
3-90.

21
(Source: P.A. 102-700, eff. 4-19-22.)

22

(35 ILCS 105/3-10)

from Ch. 120, par. 439.33-10
23

Sec. 3-10.
Rate of tax.
Unless otherwise provided in this
24
Section, the tax imposed by this Act is at the rate of 6.25% of
25
either the selling price or the fair market value, if any, of

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LRB104 14805 HLH 27948 b
1
the tangible personal property, which, on and after January 1,
2
2025, includes leases of tangible personal property. In all
3
cases where property functionally used or consumed is the same
4
as the property that was purchased at retail, then the tax is
5
imposed on the selling price of the property. In all cases
6
where property functionally used or consumed is a by-product
7
or waste product that has been refined, manufactured, or
8
produced from property purchased at retail, then the tax is
9
imposed on the lower of the fair market value, if any, of the
10
specific property so used in this State or on the selling price
11
of the property purchased at retail. For purposes of this
12
Section "fair market value" means the price at which property
13
would change hands between a willing buyer and a willing
14
seller, neither being under any compulsion to buy or sell and
15
both having reasonable knowledge of the relevant facts. The
16
fair market value shall be established by Illinois sales by
17
the taxpayer of the same property as that functionally used or
18
consumed, or if there are no such sales by the taxpayer, then
19
comparable sales or purchases of property of like kind and
20
character in Illinois.
21

Beginning on July 1, 2000 and through December 31, 2000,
22
with respect to motor fuel, as defined in Section 1.1 of the
23
Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of
24
the Use Tax Act, the tax is imposed at the rate of 1.25%.
25

During the Sales Tax Holiday Period, as defined in Section
26
3-6,

Beginning on August 6, 2010 through August 15, 2010, and

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LRB104 14805 HLH 27948 b
1
beginning again on August 5, 2022 through August 14, 2022,

2
with respect to sales tax holiday items as defined in Section
3
3-6 of this Act, the tax is imposed at the rate of 1.25%.
4

With respect to gasohol, the tax imposed by this Act
5
applies to (i) 70% of the proceeds of sales made on or after
6
January 1, 1990, and before July 1, 2003, (ii) 80% of the
7
proceeds of sales made on or after July 1, 2003 and on or
8
before July 1, 2017, (iii) 100% of the proceeds of sales made
9
after July 1, 2017 and prior to January 1, 2024, (iv) 90% of
10
the proceeds of sales made on or after January 1, 2024 and on
11
or before December 31, 2028, and (v) 100% of the proceeds of
12
sales made after December 31, 2028. If, at any time, however,
13
the tax under this Act on sales of gasohol is imposed at the
14
rate of 1.25%, then the tax imposed by this Act applies to 100%
15
of the proceeds of sales of gasohol made during that time.
16

With respect to mid-range ethanol blends, the tax imposed
17
by this Act applies to (i) 80% of the proceeds of sales made on
18
or after January 1, 2024 and on or before December 31, 2028 and
19
(ii) 100% of the proceeds of sales made thereafter. If, at any
20
time, however, the tax under this Act on sales of mid-range
21
ethanol blends is imposed at the rate of 1.25%, then the tax
22
imposed by this Act applies to 100% of the proceeds of sales of
23
mid-range ethanol blends made during that time.
24

With respect to majority blended ethanol fuel, the tax
25
imposed by this Act does not apply to the proceeds of sales
26
made on or after July 1, 2003 and on or before December 31,

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2028 but applies to 100% of the proceeds of sales made
2
thereafter.
3

With respect to biodiesel blends with no less than 1% and
4
no more than 10% biodiesel, the tax imposed by this Act applies
5
to (i) 80% of the proceeds of sales made on or after July 1,
6
2003 and on or before December 31, 2018 and (ii) 100% of the
7
proceeds of sales made after December 31, 2018 and before
8
January 1, 2024. On and after January 1, 2024 and on or before
9
December 31, 2030, the taxation of biodiesel, renewable
10
diesel, and biodiesel blends shall be as provided in Section
11
3-5.1. If, at any time, however, the tax under this Act on
12
sales of biodiesel blends with no less than 1% and no more than
13
10% biodiesel is imposed at the rate of 1.25%, then the tax
14
imposed by this Act applies to 100% of the proceeds of sales of
15
biodiesel blends with no less than 1% and no more than 10%
16
biodiesel made during that time.
17

With respect to biodiesel and biodiesel blends with more
18
than 10% but no more than 99% biodiesel, the tax imposed by
19
this Act does not apply to the proceeds of sales made on or
20
after July 1, 2003 and on or before December 31, 2023. On and
21
after January 1, 2024 and on or before December 31, 2030, the
22
taxation of biodiesel, renewable diesel, and biodiesel blends
23
shall be as provided in Section 3-5.1.
24

Until July 1, 2022 and from July 1, 2023 through December
25
31, 2025, with respect to food for human consumption that is to
26
be consumed off the premises where it is sold (other than

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LRB104 14805 HLH 27948 b
1
alcoholic beverages, food consisting of or infused with adult
2
use cannabis, soft drinks, and food that has been prepared for
3
immediate consumption), the tax is imposed at the rate of 1%.
4
Beginning on July 1, 2022 and until July 1, 2023, with respect
5
to food for human consumption that is to be consumed off the
6
premises where it is sold (other than alcoholic beverages,
7
food consisting of or infused with adult use cannabis, soft
8
drinks, and food that has been prepared for immediate
9
consumption), the tax is imposed at the rate of 0%. On and
10
after January 1, 2026, food for human consumption that is to be
11
consumed off the premises where it is sold (other than
12
alcoholic beverages, food consisting of or infused with adult
13
use cannabis, soft drinks, candy, and food that has been
14
prepared for immediate consumption) is exempt from the tax
15
imposed by this Act.
16

With respect to prescription and nonprescription
17
medicines, drugs, medical appliances, products classified as
18
Class III medical devices by the United States Food and Drug
19
Administration that are used for cancer treatment pursuant to
20
a prescription, as well as any accessories and components
21
related to those devices, modifications to a motor vehicle for
22
the purpose of rendering it usable by a person with a
23
disability, and insulin, blood sugar testing materials,
24
syringes, and needles used by human diabetics, the tax is
25
imposed at the rate of 1%. For the purposes of this Section,
26
until September 1, 2009: the term "soft drinks" means any

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1
complete, finished, ready-to-use, non-alcoholic drink, whether
2
carbonated or not, including, but not limited to, soda water,
3
cola, fruit juice, vegetable juice, carbonated water, and all
4
other preparations commonly known as soft drinks of whatever
5
kind or description that are contained in any closed or sealed
6
bottle, can, carton, or container, regardless of size; but
7
"soft drinks" does not include coffee, tea, non-carbonated
8
water, infant formula, milk or milk products as defined in the
9
Grade A Pasteurized Milk and Milk Products Act, or drinks
10
containing 50% or more natural fruit or vegetable juice.
11

Notwithstanding any other provisions of this Act,
12
beginning September 1, 2009, "soft drinks" means non-alcoholic
13
beverages that contain natural or artificial sweeteners. "Soft
14
drinks" does not include beverages that contain milk or milk
15
products, soy, rice or similar milk substitutes, or greater
16
than 50% of vegetable or fruit juice by volume.
17

Until August 1, 2009, and notwithstanding any other
18
provisions of this Act, "food for human consumption that is to
19
be consumed off the premises where it is sold" includes all
20
food sold through a vending machine, except soft drinks and
21
food products that are dispensed hot from a vending machine,
22
regardless of the location of the vending machine. Beginning
23
August 1, 2009, and notwithstanding any other provisions of
24
this Act, "food for human consumption that is to be consumed
25
off the premises where it is sold" includes all food sold
26
through a vending machine, except soft drinks, candy, and food

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1
products that are dispensed hot from a vending machine,
2
regardless of the location of the vending machine.
3

Notwithstanding any other provisions of this Act,
4
beginning September 1, 2009, "food for human consumption that
5
is to be consumed off the premises where it is sold" does not
6
include candy. For purposes of this Section, "candy" means a
7
preparation of sugar, honey, or other natural or artificial
8
sweeteners in combination with chocolate, fruits, nuts or
9
other ingredients or flavorings in the form of bars, drops, or
10
pieces. "Candy" does not include any preparation that contains
11
flour or requires refrigeration.
12

Notwithstanding any other provisions of this Act,
13
beginning September 1, 2009, "nonprescription medicines and
14
drugs" does not include grooming and hygiene products. For
15
purposes of this Section, "grooming and hygiene products"
16
includes, but is not limited to, soaps and cleaning solutions,
17
shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
18
lotions and screens, unless those products are available by
19
prescription only, regardless of whether the products meet the
20
definition of "over-the-counter-drugs". For the purposes of
21
this paragraph, "over-the-counter-drug" means a drug for human
22
use that contains a label that identifies the product as a drug
23
as required by 21 CFR 201.66. The "over-the-counter-drug"
24
label includes:
25

(A) a "Drug Facts" panel; or
26

(B) a statement of the "active ingredient(s)" with a

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1

list of those ingredients contained in the compound,
2

substance or preparation.
3

Beginning on January 1, 2014 (the effective date of Public
4
Act 98-122), "prescription and nonprescription medicines and
5
drugs" includes medical cannabis purchased from a registered
6
dispensing organization under the Compassionate Use of Medical
7
Cannabis Program Act.
8

As used in this Section, "adult use cannabis" means
9
cannabis subject to tax under the Cannabis Cultivation
10
Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
11
and does not include cannabis subject to tax under the
12
Compassionate Use of Medical Cannabis Program Act.
13

If the property that is purchased at retail from a
14
retailer is acquired outside Illinois and used outside
15
Illinois before being brought to Illinois for use here and is
16
taxable under this Act, the "selling price" on which the tax is
17
computed shall be reduced by an amount that represents a
18
reasonable allowance for depreciation for the period of prior
19
out-of-state use. No depreciation is allowed in cases where
20
the tax under this Act is imposed on lease receipts.
21
(Source: P.A. 102-4, eff. 4-27-21; 102-700, Article 20,
22
Section 20-5, eff. 4-19-22; 102-700, Article 60, Section
23
60-15, eff. 4-19-22; 102-700, Article 65, Section 65-5, eff.
24
4-19-22; 103-9, eff. 6-7-23; 103-154, eff. 6-30-23; 103-592,
25
eff. 1-1-25; 103-781, eff. 8-5-24; revised 11-26-24.)

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1

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

3

(35 ILCS 120/2-8)
4

Sec. 2-8.
Sales tax holiday items.
5

(a) Any tangible personal property described in this
6
subsection is a sales tax holiday item and qualifies for the
7
1.25% reduced rate of tax
during

for
the
period set forth in
8
Section 2-10 of this Act (hereinafter referred to as the
Sales
9
Tax Holiday Period
)
. The reduced rate on these items shall be
10
administered under the provisions of subsection (b) of this
11
Section. The following items are subject to the reduced rate:
12

(1) Clothing items that each have a retail selling
13

price of less than $125.
14

"Clothing" means, unless otherwise specified in this
15

Section, all human wearing apparel suitable for general
16

use. "Clothing" does not include clothing accessories,
17

protective equipment, or sport or recreational equipment.
18

"Clothing" includes, but is not limited to: household and
19

shop aprons; athletic supporters; bathing suits and caps;
20

belts and suspenders; boots; coats and jackets; ear muffs;
21

footlets; gloves and mittens for general use; hats and
22

caps; hosiery; insoles for shoes; lab coats; neckties;
23

overshoes; pantyhose; rainwear; rubber pants; sandals;
24

scarves; shoes and shoelaces; slippers; sneakers; socks
25

and stockings; steel-toed shoes; underwear; and school

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1

uniforms.
2

"Clothing accessories" means, but is not limited to:
3

briefcases; cosmetics; hair notions, including, but not
4

limited to barrettes, hair bows, and hair nets; handbags;
5

handkerchiefs; jewelry; non-prescription sunglasses;
6

umbrellas; wallets; watches; and wigs and hair pieces.
7

"Protective equipment" means, but is not limited to:
8

breathing masks; clean room apparel and equipment; ear and
9

hearing protectors; face shields; hard hats; helmets;
10

paint or dust respirators; protective gloves; safety
11

glasses and goggles; safety belts; tool belts; and
12

welder's gloves and masks.
13

"Sport or recreational equipment" means, but is not
14

limited to: ballet and tap shoes; cleated or spiked
15

athletic shoes; gloves, including, but not limited to,
16

baseball, bowling, boxing, hockey, and golf gloves;
17

goggles; hand and elbow guards; life preservers and vests;
18

mouth guards; roller and ice skates; shin guards; shoulder
19

pads; ski boots; waders; and wetsuits and fins.
20

(2) School supplies. "School supplies" means, unless
21

otherwise specified in this Section, items used by a
22

student in a course of study. The purchase of school
23

supplies for use by persons other than students for use in
24

a course of study are not eligible for the reduced rate of
25

tax. "School supplies" do not include school art supplies;
26

school instructional materials; cameras; film and memory

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1

cards; videocameras, tapes, and videotapes; computers;
2

cell phones; Personal Digital Assistants (PDAs); handheld
3

electronic schedulers; and school computer supplies.
4

"School supplies" includes, but is not limited to:
5

binders; book bags; calculators; cellophane tape;
6

blackboard chalk; compasses; composition books; crayons;
7

erasers; expandable, pocket, plastic, and manila folders;
8

glue, paste, and paste sticks; highlighters; index cards;
9

index card boxes; legal pads; lunch boxes; markers;
10

notebooks; paper, including loose leaf ruled notebook
11

paper, copy paper, graph paper, tracing paper, manila
12

paper, colored paper, poster board, and construction
13

paper; pencils; pencil leads; pens; ink and ink refills
14

for pens; pencil boxes and other school supply boxes;
15

pencil sharpeners; protractors; rulers; scissors; and
16

writing tablets.
17

"School art supply" means an item commonly used by a
18

student in a course of study for artwork and includes only
19

the following items: clay and glazes; acrylic, tempera,
20

and oil paint; paintbrushes for artwork; sketch and
21

drawing pads; and watercolors.
22

"School instructional material" means written material
23

commonly used by a student in a course of study as a
24

reference and to learn the subject being taught and
25

includes only the following items: reference books;
26

reference maps and globes; textbooks; and workbooks.

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1

"School computer supply" means an item commonly used
2

by a student in a course of study in which a computer is
3

used and applies only to the following items: flashdrives
4

and other computer data storage devices; data storage
5

media, such as diskettes and compact disks; boxes and
6

cases for disk storage; external ports or drives; computer
7

cases; computer cables; computer printers; and printer
8

cartridges, toner, and ink.
9

(b) Administration. Notwithstanding any other provision of
10
this Act, the reduced rate of tax under Section 3-10 of this
11
Act for clothing and school supplies shall be administered by
12
the Department under the provisions of this subsection (b).
13

(1) Bundled sales. Items that qualify for the reduced
14

rate of tax that are bundled together with items that do
15

not qualify for the reduced rate of tax and that are sold
16

for one itemized price will be subject to the reduced rate
17

of tax only if the value of the items that qualify for the
18

reduced rate of tax exceeds the value of the items that do
19

not qualify for the reduced rate of tax.
20

(2) Coupons and discounts. An unreimbursed discount by
21

the seller reduces the sales price of the property so that
22

the discounted sales price determines whether the sales
23

price is within a sales tax holiday price threshold. A
24

coupon or other reduction in the sales price is treated as
25

a discount if the seller is not reimbursed for the coupon
26

or reduction amount by a third party.

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1

(3) Splitting of items normally sold together.
2

Articles that are normally sold as a single unit must
3

continue to be sold in that manner. Such articles cannot
4

be priced separately and sold as individual items in order
5

to obtain the reduced rate of tax. For example, a pair of
6

shoes cannot have each shoe sold separately so that the
7

sales price of each shoe is within a sales tax holiday
8

price threshold.
9

(4) Rain checks. A rain check is a procedure that
10

allows a customer to purchase an item at a certain price at
11

a later time because the particular item was out of stock.
12

Eligible property that customers purchase during the Sales
13

Tax Holiday Period with the use of a rain check will
14

qualify for the reduced rate of tax regardless of when the
15

rain check was issued. Issuance of a rain check during the
16

Sales Tax Holiday Period will not qualify eligible
17

property for the reduced rate of tax if the property is
18

actually purchased after the Sales Tax Holiday Period.
19

(5) Exchanges. The procedure for an exchange in
20

regards to a sales tax holiday is as follows:
21

(A) If a customer purchases an item of eligible
22

property during the Sales Tax Holiday Period, but
23

later exchanges the item for a similar eligible item,
24

even if a different size, different color, or other
25

feature, no additional tax is due even if the exchange
26

is made after the Sales Tax Holiday Period.

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1

(B) If a customer purchases an item of eligible
2

property during the Sales Tax Holiday Period, but
3

after the Sales Tax Holiday Period has ended, the
4

customer returns the item and receives credit on the
5

purchase of a different item, the 6.25% general
6

merchandise sales tax rate is due on the sale of the
7

newly purchased item.
8

(C) If a customer purchases an item of eligible
9

property before the Sales Tax Holiday Period, but
10

during the Sales Tax Holiday Period the customer
11

returns the item and receives credit on the purchase
12

of a different item of eligible property, the reduced
13

rate of tax is due on the sale of the new item if the
14

new item is purchased during the Sales Tax Holiday
15

Period.
16

(6) (Blank).
17

(7) Order date and back orders. For the purpose of a
18

sales tax holiday, eligible property qualifies for the
19

reduced rate of tax if: (i) the item is both delivered to
20

and paid for by the customer during the Sales Tax Holiday
21

Period or (ii) the customer orders and pays for the item
22

and the seller accepts the order during the Sales Tax
23

Holiday Period for immediate shipment, even if delivery is
24

made after the Sales Tax Holiday Period. The seller
25

accepts an order when the seller has taken action to fill
26

the order for immediate shipment. Actions to fill an order

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1

include placement of an "in date" stamp on an order or
2

assignment of an "order number" to an order within the
3

Sales Tax Holiday Period. An order is for immediate
4

shipment when the customer does not request delayed
5

shipment. An order is for immediate shipment
6

notwithstanding that the shipment may be delayed because
7

of a backlog of orders or because stock is currently
8

unavailable to, or on back order by, the seller.
9

(8) Returns. For a 60-day period immediately after the
10

Sales Tax Holiday Period, if a customer returns an item
11

that would qualify for the reduced rate of tax, credit for
12

or refund of sales tax shall be given only at the reduced
13

rate unless the customer provides a receipt or invoice
14

that shows tax was paid at the 6.25% general merchandise
15

rate, or the seller has sufficient documentation to show
16

that tax was paid at the 6.25% general merchandise rate on
17

the specific item. This 60-day period is set solely for
18

the purpose of designating a time period during which the
19

customer must provide documentation that shows that the
20

appropriate sales tax rate was paid on returned
21

merchandise. The 60-day period is not intended to change a
22

seller's policy on the time period during which the seller
23

will accept returns.
24

(c) The Department may implement the provisions of this
25
Section through the use of emergency rules, along with
26
permanent rules filed concurrently with such emergency rules,

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1
in accordance with the provisions of Section 5-45 of the
2
Illinois Administrative Procedure Act. For purposes of the
3
Illinois Administrative Procedure Act, the adoption of rules
4
to implement the provisions of this Section shall be deemed an
5
emergency and necessary for the public interest, safety, and
6
welfare.
7

(d) As used in this Section:

8

"Sales Tax Holiday Period" means:

9

(1) August 6, 2010 through August 15, 2010;
10

(2) August 5, 2022 through August 14, 2022;

11

(3) August 5, 2026 through August 14, 2026; and
12

(4) August 5 through August 14 of each year
13

thereafter.

14

(e) This Section is exempt from the provisions of Section
15
2-70.

16
(Source: P.A. 102-700, eff. 4-19-22.)

17

(35 ILCS 120/2-10)

from Ch. 120, par. 441-10
18

Sec. 2-10.
Rate of tax.
Unless otherwise provided in this
19
Section, the tax imposed by this Act is at the rate of 6.25% of
20
gross receipts from sales, which, on and after January 1,
21
2025, includes leases, of tangible personal property made in
22
the course of business.
23

Beginning on July 1, 2000 and through December 31, 2000,
24
with respect to motor fuel, as defined in Section 1.1 of the
25
Motor Fuel Tax Law, and gasohol, as defined in Section 3-40 of

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1
the Use Tax Act, the tax is imposed at the rate of 1.25%.
2

During the Sales Tax Holiday Period, as defined in Section
3
2-8,

Beginning on August 6, 2010 through August 15, 2010, and
4
beginning again on August 5, 2022 through August 14, 2022,

5
with respect to sales tax holiday items as defined in Section
6
2-8 of this Act, the tax is imposed at the rate of 1.25%.
7

Within 14 days after July 1, 2000 (the effective date of
8
Public Act 91-872), each retailer of motor fuel and gasohol
9
shall cause the following notice to be posted in a prominently
10
visible place on each retail dispensing device that is used to
11
dispense motor fuel or gasohol in the State of Illinois: "As of
12
July 1, 2000, the State of Illinois has eliminated the State's
13
share of sales tax on motor fuel and gasohol through December
14
31, 2000. The price on this pump should reflect the
15
elimination of the tax." The notice shall be printed in bold
16
print on a sign that is no smaller than 4 inches by 8 inches.
17
The sign shall be clearly visible to customers. Any retailer
18
who fails to post or maintain a required sign through December
19
31, 2000 is guilty of a petty offense for which the fine shall
20
be $500 per day per each retail premises where a violation
21
occurs.
22

With respect to gasohol, as defined in the Use Tax Act, the
23
tax imposed by this Act applies to (i) 70% of the proceeds of
24
sales made on or after January 1, 1990, and before July 1,
25
2003, (ii) 80% of the proceeds of sales made on or after July
26
1, 2003 and on or before July 1, 2017, (iii) 100% of the

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1
proceeds of sales made after July 1, 2017 and prior to January
2
1, 2024, (iv) 90% of the proceeds of sales made on or after
3
January 1, 2024 and on or before December 31, 2028, and (v)
4
100% of the proceeds of sales made after December 31, 2028. If,
5
at any time, however, the tax under this Act on sales of
6
gasohol, as defined in the Use Tax Act, is imposed at the rate
7
of 1.25%, then the tax imposed by this Act applies to 100% of
8
the proceeds of sales of gasohol made during that time.
9

With respect to mid-range ethanol blends, as defined in
10
Section 3-44.3 of the Use Tax Act, the tax imposed by this Act
11
applies to (i) 80% of the proceeds of sales made on or after
12
January 1, 2024 and on or before December 31, 2028 and (ii)
13
100% of the proceeds of sales made after December 31, 2028. If,
14
at any time, however, the tax under this Act on sales of
15
mid-range ethanol blends is imposed at the rate of 1.25%, then
16
the tax imposed by this Act applies to 100% of the proceeds of
17
sales of mid-range ethanol blends made during that time.
18

With respect to majority blended ethanol fuel, as defined
19
in the Use Tax Act, the tax imposed by this Act does not apply
20
to the proceeds of sales made on or after July 1, 2003 and on
21
or before December 31, 2028 but applies to 100% of the proceeds
22
of sales made thereafter.
23

With respect to biodiesel blends, as defined in the Use
24
Tax Act, with no less than 1% and no more than 10% biodiesel,
25
the tax imposed by this Act applies to (i) 80% of the proceeds
26
of sales made on or after July 1, 2003 and on or before

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1
December 31, 2018 and (ii) 100% of the proceeds of sales made
2
after December 31, 2018 and before January 1, 2024. On and
3
after January 1, 2024 and on or before December 31, 2030, the
4
taxation of biodiesel, renewable diesel, and biodiesel blends
5
shall be as provided in Section 3-5.1 of the Use Tax Act. If,
6
at any time, however, the tax under this Act on sales of
7
biodiesel blends, as defined in the Use Tax Act, with no less
8
than 1% and no more than 10% biodiesel is imposed at the rate
9
of 1.25%, then the tax imposed by this Act applies to 100% of
10
the proceeds of sales of biodiesel blends with no less than 1%
11
and no more than 10% biodiesel made during that time.
12

With respect to biodiesel, as defined in the Use Tax Act,
13
and biodiesel blends, as defined in the Use Tax Act, with more
14
than 10% but no more than 99% biodiesel, the tax imposed by
15
this Act does not apply to the proceeds of sales made on or
16
after July 1, 2003 and on or before December 31, 2023. On and
17
after January 1, 2024 and on or before December 31, 2030, the
18
taxation of biodiesel, renewable diesel, and biodiesel blends
19
shall be as provided in Section 3-5.1 of the Use Tax Act.
20

Until July 1, 2022 and from July 1, 2023 through December
21
31, 2025, with respect to food for human consumption that is to
22
be consumed off the premises where it is sold (other than
23
alcoholic beverages, food consisting of or infused with adult
24
use cannabis, soft drinks, and food that has been prepared for
25
immediate consumption), the tax is imposed at the rate of 1%.
26
Beginning July 1, 2022 and until July 1, 2023, with respect to

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1
food for human consumption that is to be consumed off the
2
premises where it is sold (other than alcoholic beverages,
3
food consisting of or infused with adult use cannabis, soft
4
drinks, and food that has been prepared for immediate
5
consumption), the tax is imposed at the rate of 0%. On and
6
after January 1, 2026, food for human consumption that is to be
7
consumed off the premises where it is sold (other than
8
alcoholic beverages, food consisting of or infused with adult
9
use cannabis, soft drinks, candy, and food that has been
10
prepared for immediate consumption) is exempt from the tax
11
imposed by this Act.
12

With respect to prescription and nonprescription
13
medicines, drugs, medical appliances, products classified as
14
Class III medical devices by the United States Food and Drug
15
Administration that are used for cancer treatment pursuant to
16
a prescription, as well as any accessories and components
17
related to those devices, modifications to a motor vehicle for
18
the purpose of rendering it usable by a person with a
19
disability, and insulin, blood sugar testing materials,
20
syringes, and needles used by human diabetics, the tax is
21
imposed at the rate of 1%. For the purposes of this Section,
22
until September 1, 2009: the term "soft drinks" means any
23
complete, finished, ready-to-use, non-alcoholic drink, whether
24
carbonated or not, including, but not limited to, soda water,
25
cola, fruit juice, vegetable juice, carbonated water, and all
26
other preparations commonly known as soft drinks of whatever

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1
kind or description that are contained in any closed or sealed
2
bottle, can, carton, or container, regardless of size; but
3
"soft drinks" does not include coffee, tea, non-carbonated
4
water, infant formula, milk or milk products as defined in the
5
Grade A Pasteurized Milk and Milk Products Act, or drinks
6
containing 50% or more natural fruit or vegetable juice.
7

Notwithstanding any other provisions of this Act,
8
beginning September 1, 2009, "soft drinks" means non-alcoholic
9
beverages that contain natural or artificial sweeteners. "Soft
10
drinks" does not include beverages that contain milk or milk
11
products, soy, rice or similar milk substitutes, or greater
12
than 50% of vegetable or fruit juice by volume.
13

Until August 1, 2009, and notwithstanding any other
14
provisions of this Act, "food for human consumption that is to
15
be consumed off the premises where it is sold" includes all
16
food sold through a vending machine, except soft drinks and
17
food products that are dispensed hot from a vending machine,
18
regardless of the location of the vending machine. Beginning
19
August 1, 2009, and notwithstanding any other provisions of
20
this Act, "food for human consumption that is to be consumed
21
off the premises where it is sold" includes all food sold
22
through a vending machine, except soft drinks, candy, and food
23
products that are dispensed hot from a vending machine,
24
regardless of the location of the vending machine.
25

Notwithstanding any other provisions of this Act,
26
beginning September 1, 2009, "food for human consumption that

HB4101
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LRB104 14805 HLH 27948 b
1
is to be consumed off the premises where it is sold" does not
2
include candy. For purposes of this Section, "candy" means a
3
preparation of sugar, honey, or other natural or artificial
4
sweeteners in combination with chocolate, fruits, nuts or
5
other ingredients or flavorings in the form of bars, drops, or
6
pieces. "Candy" does not include any preparation that contains
7
flour or requires refrigeration.
8

Notwithstanding any other provisions of this Act,
9
beginning September 1, 2009, "nonprescription medicines and
10
drugs" does not include grooming and hygiene products. For
11
purposes of this Section, "grooming and hygiene products"
12
includes, but is not limited to, soaps and cleaning solutions,
13
shampoo, toothpaste, mouthwash, antiperspirants, and sun tan
14
lotions and screens, unless those products are available by
15
prescription only, regardless of whether the products meet the
16
definition of "over-the-counter-drugs". For the purposes of
17
this paragraph, "over-the-counter-drug" means a drug for human
18
use that contains a label that identifies the product as a drug
19
as required by 21 CFR 201.66. The "over-the-counter-drug"
20
label includes:
21

(A) a "Drug Facts" panel; or
22

(B) a statement of the "active ingredient(s)" with a
23

list of those ingredients contained in the compound,
24

substance or preparation.
25

Beginning on January 1, 2014 (the effective date of Public
26
Act 98-122), "prescription and nonprescription medicines and

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LRB104 14805 HLH 27948 b
1
drugs" includes medical cannabis purchased from a registered
2
dispensing organization under the Compassionate Use of Medical
3
Cannabis Program Act.
4

As used in this Section, "adult use cannabis" means
5
cannabis subject to tax under the Cannabis Cultivation
6
Privilege Tax Law and the Cannabis Purchaser Excise Tax Law
7
and does not include cannabis subject to tax under the
8
Compassionate Use of Medical Cannabis Program Act.
9
(Source: P.A. 102-4, eff. 4-27-21; 102-700, Article 20,
10
Section 20-20, eff. 4-19-22; 102-700, Article 60, Section
11
60-30, eff. 4-19-22; 102-700, Article 65, Section 65-10, eff.
12
4-19-22; 103-9, eff. 6-7-23; 103-154, eff. 6-30-23; 103-592,
13
eff. 1-1-25; 103-781, eff. 8-5-24; revised 11-26-24.)

14

Section 99.
Effective date.
This Act takes effect upon
15
becoming law.

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