In the latest issues of the Illinois Register and The Flinn Report, Illinois lawmakers and the Illinois Department of Revenue (IDOR) today announced notices for several proposed 1% service tax amendments that excludes recreational cannabis drinks. The proposed service tax amendments are mainly for effective dates, rates, and formulas for taxes on fuels and food.

The rulemaking states that food prepared for immediate consumption (normally taxed at 6.25% or higher) and delivered to a hospital, long-term care facility, or Specialized Mental Health Rehabilitation Facility shall be taxed at 1%. The tax also shall be imposed at the rate of 1% on food for human consumption that is to be consumed off the premises where it is sold (other than alcoholic beverages, food consisting of or infused with adult use cannabis, soft drinks, and food that has been prepared for immediate consumption and is not otherwise included in this paragraph).

To protect registered medical patients from paying the normal 6.25% or higher for infused cannabis drinks, Representative Sonya M. Harper introduced last week House Bill 4465 that would include “cannabis or cannabis-infused products purchased from a dispensing organization under the Cannabis Regulation and Tax Act by a cardholder, as defined under Section 10 of the Compassionate Use of Medical Cannabis Act.”

The new provision would delete the words, “subject to tax under the Compassionate Use of Medical Cannabis Program Act” and replaces them with, “or cannabis-infused product sold to a cardholder, as defined under Section 10 of the Compassionate Use of Medical Cannabis Act.” The amendment would ensure medical patients pay, as with all other medical-cannabis product purchases, the 1% service tax.

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