Did Illinois's municipal gas occupation tax apply to alternative gas suppliers or only public utilities?

Plain-English summary

The requester asked whether a municipality's gas occupation tax under 65 ILCS 5/8-11-2 applied to alternative gas suppliers or only public utilities.

IDOR did not decide. It explained that this tax was administered by municipalities that elected to impose it, not by the Illinois Department of Revenue. The Department therefore lacked authority or jurisdiction to interpret how a municipality treated alternative suppliers.

The requester had to contact each municipality imposing the tax.

Common questions

Did IDOR say alternative gas suppliers were taxable? No.

Who administered the tax? The imposing municipality.

Where should a supplier seek guidance? From each relevant municipality.

Citations and references

• 65 ILCS 5/8-11-2

Source

• Landing page: https://taxarchive.illinois.gov/research/legal/letter-rulings/sales-tax/2012.html
• Original PDF: https://tax.illinois.gov/content/dam/soi/en/web/taxarchive/research/legal/letter-rulings/sales-tax/2012/st-12-0006.pdf

Original ruling text

ST 12-0006-GIL 01/27/2012 MISCELLANEOUS
Municipal gas taxes imposed under the authority provided in Section 8-11-2 of the Illinois
Municipal Code (65 ILCS 5/8-11-2) are not administered by the Department of Revenue. (This
is a GIL.)

January 27, 2012

Dear Xxxxx:
This letter is in response to your letter dated January 5, 2012, in which you request
information. The Department issues two types of letter rulings. Private Letter Rulings (“PLRs”) are
issued by the Department in response to specific taxpayer inquiries concerning the application of a
tax statute or rule to a particular fact situation. A PLR is binding on the Department, but only as to the
taxpayer who is the subject of the request for ruling and only to the extent the facts recited in the PLR
are correct and complete. Persons seeking PLRs must comply with the procedures for PLRs found in
the Department’s regulations at 2 Ill. Adm. Code 1200.110. The purpose of a General Information
Letter (“GIL”) is to direct taxpayers to Department regulations or other sources of information
regarding the topic about which they have inquired. A GIL is not a statement of Department policy
and is not binding on the Department. See 2 Ill. Adm. Code 1200.120. You may access our website
at www.tax.illinois.gov to review regulations, letter rulings and other types of information relevant to
your inquiry.
The nature of your inquiry and the information you have provided require that we respond with
a GIL. In your letter you have stated and made inquiry as follows:
Thank you for your recent response to my inquiry letter regarding the imposition of
various taxes in Illinois on utilities.
I reviewed the relevant statutes and code and still have one question.
Per 65 ILCS 5/8-11-2: The corporate authorities of any municipality may tax any or all
of the following occupations or privileges: Persons engaged in the business of
distributing, supplying, furnishing, or selling gas for use or consumption within the
corporate limits of a municipality of 500,000 or fewer population, and not for resale, at a
rate not to exceed 5% of the gross receipts there from [sic]. Persons engaged in the
business of distributing, supplying, furnishing, or selling gas for use or consumption
within the corporate limits of a municipality of over 500,000 population, and not for
resale, at a rate not to exceed 8% of the gross receipts there from [sic]. If imposed, this
tax shall be paid in monthly payments. ‘Person’ as used in this Section means any
natural individual, firm, trust, estate, partnership, association, joint stock company, joint
adventure, corporation, limited liability company, municipal corporation, the State or any
of its political subdivisions, any State university created by statute, or a receiver, trustee,
guardian or other representative appointed by order of any court.

Is the 5% (or 8%) imposed on alternative suppliers, or is it only imposed on Public
Utilities?
Thank you in advance for all your help.

DEPARTMENT’S RESPONSE:
As we explained in our letter to you dated December 19, 2011, Section 8-11-2 of the Illinois
Municipal Code (65 ILCS 5/8-11-2) is not administered by the Department of Revenue; it is
administered by municipalities that elect to impose a gas occupation tax. The Department has no
authority or jurisdiction to provide guidance in regards to municipally-administered taxes imposed
under this section of the Illinois Municipal Code.
We suggest you contact the municipalities imposing such taxes to determine how they treat
Alternative Gas Suppliers.
I hope this information is helpful. If you require additional information, please visit our website
at www.tax.illinois.gov or contact the Department’s Taxpayer Information Division at (217) 782-3336.
Very truly yours,

Richard S. Wolters
Associate Counsel
RSW:msk