G-645 - 10/26/1999 - TAX - Ordinances ORDINANCE 1999-TX-TELCOM-G-645
AN ORDINANCE AMENDING CHAPTER 13 OF
THE CODE OF ORDINANCES OF THE VILLAGE OF OAK BROOK
BY THE ADDITION OF ARTICLE VI
IMPOSING A MUNICIPAL TELECOMMUNICATIONS TAX
WHEREAS,the Village of Oak Brook is a municipality in accordance with the Constitution of the
State of Illinois of 1970; and
WHEREAS,the Village has the authority to adopt ordinances and to promulgate rules and
regulations that pertain to its government and affairs and that protect the public health, safety and welfare
of its citizens; and
NOW,THEREFORE, BE IT ORDAINED by the President and Board of Trustees of the Village of
Oak Brook as follows:
Section 1. That Chapter 13 of the Village of Oak Brook Code of Ordinances is amended by
adding new Article VI thereto,which shall read in its entirety as follows:
"ARTICLE VI. MUNICIPAL TELECOMMUNICATIONS TAX
Sec. 13-70. Definitions.
For the purpose of Sections 13-70 through 13-78, the following definitions shall apply unless the
context clearly indicates or requires a different meaning:
Amount Paid means the amount charged to the taxpayer's service address 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 Village 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 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. However,"gross charge" shall not
include:
(A) any amounts added to a purchaser's bill because of a charge made pursuant to:
(1) the tax imposed by Section 13-71;
(2) additional charges added to a purchaser's bill pursuant to Section 9-222 of the Public
Utilities Act, (220 ILCS 5/9-222);
(3) the tax imposed by the Telecommunications Excise Tax Act(35 ILCS 630/1 g sec.),
or
(4) the tax imposed by Section 4251 of the Internal Revenue Code (26 U.S.C.A. §2451);
(B) charges for a sent collect telecommunication received outside of the Village;
(C) 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. Such
equipment includes, but is not limited to,the use of calculators, computers, data processing equipment,
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tabulating equipment or accounting equipment and also includes the usage of computers under a time-
sharing agreement;
(D) 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;
(E) charges to business enterprises certified 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;
(F) 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 Section 13-71 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;
(G) 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 uncollectable, 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 the portion during the reporting period in
which the payment is made); or
(H) charges paid by inserting coins in coin-operated telecommunications devices.
(1) amounts paid by telecommunications retailers under the Telecommunications Municipal
Infrastructure Maintenance Fee Act.
(J) charges to school districts or units of local government.
Interstate Telecommunications means all telecommunications that either originate or terminate
outside this State.
Intrastate Telecommunications means all telecommunications that originate within this State.
Person means any natural individual,firm, trust, estate, partnership, association,joint stock
company,joint venture, corporation, 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.
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 this Section.
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 place 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.
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Sale at Retail means the transmitting, supplying or furnishing of telecommunications and all
services rendered in connection therewith for a consideration, to persons other than the Village, 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,when the tax has
already 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.
Service Address means the location of telecommunications equipment from which
telecommunications services are originated or at which telecommunications services are received by a
taxpayer. If this 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 telecommunication equipment as defined by telephone number, authorization code, or
location in Illinois where bills are sent.
Taxpayer means a person who individually or through his agents, employees, or permittees
engages in the act or privilege of originating or receiving telecommunications in the Village and who incurs
a tax liability under Sections 13-71 through 13-78.
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, channel
services, telegraph services, teletypewriter service, computer exchange services; cellular mobile
telecommunications service, specialized mobile radio services, pages service, or any other form of mobile
radio 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"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 purchase of telecommunications by a telecommunications service provider for use as a
component part of the service provided by him 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 used as a
component of, or integrated into, end-to-end telecommunications service shall be non-taxable as sales for
resale.
Sec. 13-71. Tax Imposed.
(A) A tax is hereby imposed upon:
(1) the act or privilege or originating in the Village or receiving in the Village intrastate
telecommunications by a person at a rate of two percent (2%)of the gross charge for such
telecommunications purchased at retail from a retailer; and
(2) the act or privilege or originating in the Village or receiving in the Village interstate
telecommunications by a person at a rate of two percent(2%)of the gross charge for such
telecommunications purchased at retail from a retailer.
(B) 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 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 tax properly due and paid in such other state which was not previously
allowed as a credit against any other state or local tax in this state.
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(C) The tax imposed by this Section 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 Village.
Sec. 13-72. Collection of Tax By Retailers.
(A)(1) Any retailer maintaining a place of business in this state and making or effectuating a sale
at retail shall collect the tax imposed by Section 13-71 from the taxpayer and remit it to the
Village Treasurer as provided by Section 13-73.
(2) Any tax required to be collected pursuant to this Section 13-72 and any tax collected by the
retailer shall constitute a debt owed by the retailer to the Village.
(3) The retailer 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 in Section 13-70 through 13-78 of this Code.
(4) The tax imposed by this chapter 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.
(B) The Finance 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 Finance 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 Section 13-71. When so authorized, it shall be the duty of
the retailer to collect the tax upon all of the gross charges for telecommunications originated or received in
the Village in this same manner, and subject to the same requirements, as a retailer maintaining a place of
business in this state.
(C) Whenever possible, the tax authorized by Section 13-71 shall,when collected, be stated as a
distinct item separate and apart from the gross charge for telecommunications.
Sec. 13-73. Filing Returns and Remittance By Retailers.
(A) On or before the last day of each calendar month, every retailer maintaining a place of
business in this state and every retailer authorized by the Finance Director to collect the tax imposed by
Section 13-71 shall file with the Village Treasurer a remittance return and remit all applicable tax for the
preceding calendar month less a commission of 1.75%which is allowed to reimburse the retailer for the
expenses incurred in keeping records, billing the customer, preparing and filing returns, remitting the tax
and supplying data to the Village upon request. No commission may be claimed by a retailer for tax not
timely remitted to the Village. The return shall be filed on a form prescribed by the Village Treasurer,
containing such information as the Treasurer may reasonably require.
(B) Notwithstanding the monthly return requirement of Subsection (A)above, in the event that a
taxpayer would remit between fifty dollars ($50)and one hundred dollars ($100) in tax revenue to the
Village per month, said taxpayer shall make a tax return as required on a semi-annual, rather than
monthly, basis. Said returns shall be in compliance with Subsection (A) above, except that they shall
cover gross receipts during the prior semi-annual (six month) period, and shall be filed on or before the
last day of January and July.
(C) Notwithstanding the monthly return requirement of Subsection (A) above, in the event that a
taxpayer would remit less than fifty dollars ($50) in tax revenue to the Village per month, said taxpayer
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shall make a tax return as required on an annual, rather than monthly, basis. Said returns shall be in
compliance with Subsection (A)above, except that they shall cover gross receipts during the prior one
year(12-month)period, and shall be filed on or before the last day of January.
Sec. 13-74. Registration.
Every retailer maintaining a place of business in this state shall register with the Finance
Department within thirty(30)days after the effective date of Sections 13-70 through 13-79 or the date of
becoming such a retailer,whichever is later.
Sec. 13-75. Obligation of Taxpayers to File Returns and Pay Tax.
(A) If a retailer fails to collect the tax imposed by Section 13-71 from a taxpayer, as required by
Section 13-72, then the taxpayer shall pay the tax directly to the Village.
(B) On or before the last day of each calendar month, every taxpayer that has not paid the tax
imposed by Section 13-71 to a retailer shall file with the Village Treasurer 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 from prescribed by the Village Treasurer, containing such information as the Treasurer
may reasonably require.
Sec. 13-76. Resale Numbers.
(A) If a person who originates or receives telecommunications in the Village claims to be a
reseller of telecommunications, that person shall apply to the Finance Department for a resale number.
�- The applicant shall state facts showing why it is not liable for the tax imposed by Section 13-71 on any
purchases of telecommunications and shall furnish such additional information as the Finance Department
may reasonably require.
(B) Upon approval of the application, the Finance Department shall assign a resale number to the
applicant and shall certify the number to the applicant.
(C) The Finance Department may cancel the resale number of any person if the number:
(1) was obtained through misrepresentation;
(2) is used to originate or receive telecommunications tax-free when such
telecommunications are not for resale; or
(3) is no longer necessary because the person has discontinued making resales.
(D) The act or privilege of originating or receiving telecommunications in the Village shall not be
made tax-free on the grounds of being a sale for resale unless the person has an active resale number
issued by the Finance Department and furnishes that number to the retailer on connection with certifying
to the retailer that a sale is nontaxable as a sale for resale.
Sec. 13-77. Maintaining Books and Records.
Every retailer maintaining a place of business in this state, every retailer authorized by the
Finance Director to collect the tax imposed by Section 13-71 and every taxpayer required by Section 13-
75 to pay the tax directly to the Village Treasurer 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 by the Finance Department.
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Sec. 13-78. Disposition of Collected Funds.
(A) Any and all taxes collected pursuant to Sections 13-70 through 13-77 are to be collected and
deposited into the General Corporate Fund of the Village.
Sec. 13-79. Severability.
If any provision of Sections 13-71 through 13-78, or the application of any provision thereof, is
held unconstitutional or otherwise invalid, such occurrence shall not affect other provisions of said
sections, 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. In particular, if Subsection (A)(2)of Section 13-71 is declared unconstitutional
or otherwise invalid,the tax imposed under Subsection (A)(1)of Section 13-71 shall remain in full force
and effect.
Section : That all ordinances or parts of ordinances in conflict herewith are, to the extent of such
conflict, hereby repealed.
Section 4: That this ordinance shall be in full force and effect from and after its passage,
approval and publication in pamphlet form as required by law or January 1, 2000,whichever is later.
Section 5: That the Village Clerk is hereby authorized and directed to publish this ordinance in
pamphlet form in the manner provided by law.
PASSED THIS 26th day of October, 1999.
Ayes: Trustees Butler, Caleel, Craig, Kenny, McInerney and Savino
Nays: None
Absent: None
Abstain: None
APPROVED THIS 26th day of October, 1999.
0�Y 0 illage President
ATTES `�! ..,.� :. r. ,:v-:t.•. G=
Villag Clerk
�•CJL';al��/
Approved as to Form:
Y"
�' Village Attorney
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Published 10-27-99 Pamphlet form
Date Paper
Not Published
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