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G-684 - 10/09/2001 - TAX - OrdinancesORDINANCE 2001 -TX- TELCOM -G -684 AN ORDINANCE FURTHER AMENDING ORDINANCE G -645, "AN ORDINANCE IMPOSING A MUNICIPAL TELECOMMUNICATION TAX WITHIN THE VILLAGE OF OAK BROOK DU PAGE AND COOK COUNTIES, IL" 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 WHEREAS, it is in the best interest of the Village that the tax rate for the Telecommunications Tax be increased to five percent (5 %) in order to fund general government operations; NOW, THEREFORE, BE IT ORDAINED by the President and Board of Trustees of the Village of Oak Brook as follows: Section 1, That Chapter 3 entitled "Municipal Telecommunications Tax" of Title 5 of the Code of Ordinances of the Village of Oak Brook is hereby amended to state as follows: "CHAPTER 3, TITLE 5. MUNICIPAL TELECOMMUNICATIONS TAX Sec. 5 -3 -1. Definitions. For purposes of this Chapter, 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 5 -3 -2, (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 et 5=.), or (4) the tax imposed by Section 4251 of the Internal Revenue Code (26 U S C A. §2451), Ordinance 2001 -TX- TELCOM -G -684 Municipal Telecommunications Tax Page 3 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. 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 this chapter. 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. 5 -3 -2. Tax Imposed. A. A tax is hereby imposed upon. the act or privilege or originating in the Village or receiving in the Village intrastate telecommunications by a person at a rate of five percent (5 %) of the gross charge for such telecommunications purchased at retail from a retailer; and 2. the act or privilege or originating in the Village or receiving in the Village interstate telecommunications by a person at a rate of five percent (5 %) of the gross charge for such telecommunications purchased at retail from a retailer. Ordinance 2001 -TX- TELCOM -G -684 Municipal Telecommunications Tax Page 5 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. 2. Notwithstanding the monthly return requirement of Subsection Al of this Section, 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 charges during the prior semi- annual (six month) period, and shall be filed on or before the last day of January and July 3. Notwithstanding the monthly return requirement of Subsection Al of this Section, in the event that a taxpayer would remit less than fifty dollars ($50) in tax revenue to the Village per month, said taxpayer 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 charges during the prior one year (12- month) period, and shall be filed on or before the last day of January. B. Obligation To File and Pay Tax. 1. If a retailer fails to collect the tax imposed by Section 5 -3 -2 of this Chapter from a taxpayer, as required by Section 5 -3 -3 of this Chapter, then the taxpayer shall pay the tax directly to the Village. 2. On or before the last day of each calendar month, every taxpayer that has not paid the tax imposed by Section 5 -3 -2 of this Chapter 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. C. Disposition of Revenues: Any and all taxes collected pursuant to this Chapter are to be collected and deposited into the general corporate fund of the Village. Sec. 5-3-5. 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 hereof or the date of becoming such a retailer, whichever is later. Sec. 5 -3 -6. Resale Numbers. A If a person who originates or receives telecommunications in the Village claims to be a seller 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 5 -3 -2 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: Ordinance 2001 -TX- TELCOM -G- 684 Municipal Telecommunications Tax Page 7 PASSED THIS 9th day of October, 2001. Ayes- Trustees Butler, Caleel, Korin and Savino Nays: Trustee Craig Absent: Trustee Miologos Abstain: None APPROVED THIS 9 th day of October, 2001. Approved as to Form: d. Village Attorney Village President Published 10/ 10/01 Date Not Published Pamphlet Form Paper Ordnance 2001 -TX- TELCOM -G -684 Municipal Telecommunications Tax Page 2 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, 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 5 -3 -2 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), H. charges paid by inserting coins in coin- operated telecommunications devices I. 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, point 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 Ordinance 2001 -TX- TELCOM -G -684 Municipal Telecommunications Tax Page 4 B. to prevent actual multi -state taxation of the act or privilege that is subject to taxation under subsection A2 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 A2 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. 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. 5 -3 -3. Collection of Tax. A. Collection Procedures: 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 5 -3 -2 of this Chapter from the taxpayer and remit it to the Village Treasurer as provided by Section 5 -34A of this Chapter. 2. Any tax required to be collected pursuant to this Section 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 this Chapter. 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 5 -3 -2. 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 5 -3 -2 of this Chapter shall, when collected, be stated as a distinct item separate and apart from the gross charge for telecommunications. Sec. 5 -3-4. Filing Returns; Remittance. A. Filing Returns- 1. 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 5 -3 -2 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 Ordinance 2001 -TX- TELCOM -G -684 Municipal Telecommunications Tax Page 6 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. 5 -3 -7. 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 5 -3 -2 of this Chapter and every taxpayer required by Subsection 5 -3-413 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. Sec. 5-3-8. Severability. If any provision of this Chapter, 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 5 -3 -2A2 of this Chapter is declared unconstitutional or otherwise invalid, the tax imposed under Subsection 5 -3 -2A1 of this Chapter shall remain in full force and effect." Section 2s That all ordinances or parts of ordinances in conflict herewith are, to the extent of such conflict, hereby repealed. Section-aL That this Ordinance shall be in full force and effect from and after its passage, approval and publication in pamphlet form as provided by law and the amendments provided herein shall be effective for services billed on or after November 1, 2001 Section 4: That this Ordinance shall be in full force and effect from and after its passage, approval and publication in pamphlet form as provided by law and the amendments provided herein shall be effective for services billed on or after November 1, 2001; provided, however, that any amounts due or payable for any tax periods ending' prior to November 1, 2001 are nevertheless to remain payable as if this Ordinance had not been adopted. Section 5. 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 Section 6: That the Village Clerk is hereby authorized and directed to publish this ordinance in pamphlet form in the manner provided by law.