(A) The tax imposed by this section shall be known as the “personal property lease transaction tax” or the “lease transaction tax” and is imposed in addition to all other taxes imposed by the village, or any other municipal corporation or political subdivision thereof.
(B) Definitions. For the purposes of this section, the following definitions shall apply unless the context clearly indicates or requires a different meaning.
LEASE or RENTAL. Any transfer of the possession or use of personal property, but not title or ownership, to a user for consideration, whether or not designated as a lease, rental, license or by some other term, and includes a NONPOSSESSORY LEASE.
(a) NONPOSSESSORY LEASE. A lease or rental wherein use but not possession of the personal property is transferred and includes, but is not limited to, leased time on or use of any and all personal property not otherwise itself rented, such as leased time on or for the use of addressing machines, billboards, calculators, computers, computer software, copying equipment or data processing equipment, whether the time is fully or partially utilized.
(b) The words LEASE or RENTAL shall not be construed to include an agreement which constitutes a bona fide conditional sale of personal property. The primary consideration in determining whether an agreement is a conditional sale rather than a LEASE or RENTAL is whether the lessee under the agreement both is required to make payments the sum of which is at least equal to the lessor’s cost of the personal property and, under the terms of the agreement, has the option of taking title to or ownership of the personal property for nominal or no consideration after all payments required under the agreement have been made.
LEASE OR RENTAL PAYMENT PERIOD. The length of time or period of use that is covered by a single lease or rental payment as agreed to under the terms of the lease or rental agreement.
LEASE PRICE or RENTAL PRICE. The consideration for the lease or rental of personal property, valued in money, whether received in money or otherwise, including cash, credits, property and services, determined without any deduction for costs or expenses whatsoever, but not including charges that are added to the price by a lessor on account of the tax imposed by this section or on account of any other tax imposed on the lessee for the lease or rental of personal property. LEASE PRICE or RENTAL PRICE shall exclude separately stated charges not for the use of personal property. If any separately stated charge is not optional, it shall be presumed unless proved otherwise that it is part of the charge for the use of the personal property.
LESSEE. Any person who leases or rents personal property from another, whether the lease or rental price is paid by the lessee or by another person.
LESSOR. Any person, including the assignee of any lease or rental agreement, who leases or rents personal property to users.
PERSON. Any individual, receiver, administrator, executor, conservator, trust, estate, partnership, joint venture, club, joint stock company, business trust, corporation, association, limited liability company, membership organization, syndicate, society, or any group of individuals acting as a unit, whether mutual, cooperative, fraternal, nonprofit, or otherwise, or the State of Illinois or any political subdivision thereof, or the United States or any instrumentality thereof.
PERSONAL PROPERTY. Any and all property other than real property.
RAILROAD ROLLING STOCK. All railroad cars and locomotives (including switching locomotives) or mobile power units of every nature for moving the cars, operating on railroad tracks, and includes containers that are used by interstate carriers for hire, loaded on railroad cars, to transport property. This definition does not include jacks, flares, or other items that are used by interstate carriers for hire in servicing the transportation vehicles, but that do not become a part of the vehicles, and that do not participate directly in some way in the transportation process.
USE. The exercise of any right to or power over personal property by a lessee incident to the lease or rental of that property including, but not limited to, the permanent or temporary storage, stationing or garaging of personal property by the lessee. USE by a lessee includes not only the use of personal property directly by the lessee but also the use of personal property by the lessee’s agents, representatives or other authorized designees.
VILLAGE. The Village of Elwood.
(C) Tax imposed.
(1) Except as otherwise provided in this section, a tax is imposed upon the lease or rental in the village of personal property, and the privilege of using in the village personal property that is leased or rented outside the village. The incidence of the tax and the obligation to pay the tax are upon the lessee of the personal property.
(2) The rate of the tax shall be 2% of the lease or rental price. The tax shall be paid by the lessee at the time of each lease or rental payment, and each tax payment shall be determined by applying the tax rate to the lease or rental payment.
(3) For purposes of this section, the lease or rental of personal property shall be deemed to take place at the location where the lessee takes possession or delivery of the personal property.
(4) To prevent multiple taxation, any lessee that uses in the village personal property leased or rented outside the village may claim a credit against the tax imposed by this section equal to any municipal tax properly due and actually paid to another municipality with respect to the lease or rental of such personal property. The credit may not exceed the amount of the tax imposed by this section that otherwise would be due.
(5) Nothing in this section shall be construed to impose a tax upon any transaction or privilege which, under the constitutions of the United States or the State of Illinois, may not be made the subject of taxation by the village.
(D) Exempt lessees. Notwithstanding any other provision of this section, the following lessees shall be exempt from the tax imposed by this section:
(1) A lessee that is a governmental body;
(2) A lessee that is an organization organized and operated exclusively for charitable, educational or religious purposes.
(E) Exempt leases.
(1) Notwithstanding any other provision of this section, the following leases, rentals or uses shall be exempt from the tax imposed by this section:
(a) The lease, rental or use by a rail carrier of railroad rolling stock actually moving in interstate commerce.
(b) The use of personal property leased or rented outside the village if the property is primarily used (more than 50%) outside the village.
(2) For purposes of applying any of the exemptions contained in this section, every lease or rental payment period shall be deemed a separate transaction or privilege. Any person claiming an exemption shall have the burden of proving entitlement to the exemption for each lease or rental payment period for which the exemption is claimed.
(F) Collection of tax.
(1) It shall be the duty of each lessor to collect the tax imposed by this section from the lessee at the time of each lease or rental payment, and to remit the tax to the village. In the event that a lessor fails to collect or remit the tax required to be collected by this section, the lessor shall be liable to the village for the amount of such tax.
(2) In the case of an assignment of a lease or rental agreement, the original lessor shall not be required to collect and remit tax which becomes due after the assignment, provided that the original lessor separately stated the amount of the tax on the face of the agreement.
(3) The tax imposed by this section, when collected or billed, shall be stated as a distinct item separate and apart from the lease or rental price of the personal property.
(G) Tax remittance and returns. On or before the twentieth day of each calendar month, every lessor shall remit to the village the tax attributable to lease or rental payments received during the immediately preceding calendar month and shall file with the village a remittance return. The remittance return shall be in a form prescribed by the village, containing such information as the village may reasonably require. Any person claiming an exemption shall claim such exemption(s) on the form prescribed by the village, and shall have the burden of proving entitlement to the exemption for each lease or rental payment period for which the exemption is claimed.
(H) Maintaining books and records. Every taxpayer shall keep accurate books and records, including original source documents and books of entry, denoting the activities or transactions that gave rise, or may have given rise to any tax liability or exemption under this section. All such books and records shall, at all times during business hours, be subject to and available for inspection by the village.
(I) Failure to pay tax. If for any reason any tax is not paid when due, the lessor shall pay a penalty at the rate of 20% per month on the amount of tax which remains due but unpaid. Whenever any lessor fails to pay any tax as herein provided, the Village Attorney shall, upon the request of the corporate authorities of the village, bring or cause to be brought an action to enforce the payment of the tax on behalf of the village in any court of competent jurisdiction.
(J) Disposition of proceeds of tax. All proceeds resulting from the imposition of the tax under this section, including penalties, shall be paid into the treasury of the village and shall be credited to and deposited in the general corporate fund.
(K) Rules and regulations. The corporate authorities of the village may promulgate rules and regulations not inconsistent with the provisions of this section concerning the enforcement and application of this section. The rules and regulations which may be promulgated include, but are not limited to, a case by case determination of whether or not the tax imposed or any exemption allowed herein, applies.
(Ord. 986, passed 8-17-2011; Am. Ord. 996, passed 1-18-2012; Am. Ord. 998, passed 2-15-2012)