Illinois State and Local Tax Updates July 2019

Illinois extends deadline for Franchise Tax and License Fee Amnesty Act

July 10, 2019

Illinois extends the deadline for its Franchise Tax and License Fee Amnesty Act. Between October 1, 2019, and November 15, 2019, all taxpayers owing a license fee that was for any tax period ending after March 15, 2008, and on or before June 30, 2019, will be able to make payment under the amnesty program.

Marketplace facilitators and sellers must collect Illinois use tax January 1, 2020

July 10, 2019

Illinois Governor J.B. Pritzker has signed legislation requiring marketplace facilitators and marketplace sellers to collect Illinois use tax beginning January 1, 2020. A marketplace facilitator is required to collect tax if the cumulative gross receipts from sales of tangible personal property to purchasers in Illinois by the marketplace facilitator and by marketplace sellers are $100,000 or more; or the marketplace facilitator and marketplace sellers cumulatively enter into 200 or more separate transactions for the sale of tangible personal property to purchasers in Illinois. The legislation also expands the manufacturing and assembling machinery and equipment exemption.

New Illinois tax requirements for electronic cigarettes now in effect

July 3, 2019

The Illinois Department of Revenue has issued a bulletin on the Tobacco Products Tax Act. Effective July 1, 2019, the act defines an e-cigarette as 1) any device that employs a battery to heat a substance to produce a vapor intended for inhalation, 2) any cartridge of a substance intended to be used with the device, or 3) any substance, regardless of whether it contains nicotine, intended for use in the device. The tobacco products tax is imposed on distributors at the rate of 15% of the wholesale price of the e-cigarette sold to retailers or consumers in Illinois. For more information:

Illinois legalizes marijuana and imposes new tax to generate revenue

July 3, 2019

The Cannabis Purchaser Excise Tax must be collected by the cannabis retailer at the following rates: Cannabis with a THC level at or below 35% is taxed at 10% of the purchase price; cannabis with a THC level above 35% is taxed at a rate of 25% of the purchase price; and cannabis-infused product is taxed at a rate of 20% of the purchase price. The tax won’t be imposed on cannabis that’s subject to tax under the Compassionate Use of Medical Cannabis Pilot Program Act. The Cannabis Cultivation Privilege Tax is applicable beginning January 1, 2020.


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