The Illinois Graphic Arts Machinery Equipment exemption expires on August 30th, 2014. Without this exemption, new equipment purchased by printers will be subject to Illinois sales tax. The earliest this exemption could be extended is mid-November, 2014, when the Illinois General Assembly reconvenes. This leaves the better part of three months where printers will be subject to Illinois sales tax when buying equipment used in the production process. This will increase the cost of buying new equipment by 6.25% to 9.5%, depending on where the equipment is delivered and used.
In the interim printers with Illinois locations should refrain from purchasing new equipment for their Illinois facilities, if possible. Although it is likely that an extension of the graphic arts exemption would be retroactive, the risk that an additional cost of 6.25% – 9.5% will be owed on an equipment purchase.
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