When a parking garage uses a third-party booking intermediary that adds a service fee on top of the parking charge, whose gross receipts figure goes on Line 1 of the Parking Excise Tax return — the amount the customer pays, or the smaller amount the intermediary forwards to the garage operator?

Plain-English summary

A parking garage operator asked the Illinois Department of Revenue a very specific bookkeeping question: it started using a third-party booking intermediary that adds a service fee on top of the invoice, and the intermediary doesn't appear to be collecting or accounting for tax on that fee. If the intermediary collects, say, $X from the customer but only forwards a smaller $Y to the operator, which figure — $X or $Y — belongs on Line 1 (gross receipts) of the operator's Parking Excise Tax return?

The Department responded with the general framework rather than a number, because the answer turns on one fact: is the intermediary's service fee separately stated on the customer's invoice?

• If the fee is not separately stated (bundled into one undifferentiated total), the operator is on the hook for tax on the entire amount the customer paid — the Department's own example shows a $40 charge (of which the operator only nets $28 after the intermediary's cut) generating a $2.40 tax liability (6% of the full $40), owed by the operator.
• If the fee is separately stated, the tax liability splits: the operator owes tax only on its own listed charge, and the booking intermediary — if it's registered, or must be because it's dealing with an unregistered operator — owes tax on its own separately stated service fee.

Either way, the Illinois Parking Excise Tax (35 ILCS 525, implemented at 86 Ill. Adm. Code 195) is a separate tax from Illinois Retailers' Occupation/Sales Tax. It taxes "the privilege of using in this State a parking space in a parking area or garage" at 6% of the purchase price for hourly/daily/weekly parking and 9% for monthly/annual parking, and "purchase price" is defined broadly to include markups, service fees, convenience fees, and similar charges — regardless of what they're called.

What this means for you

Parking garage and lot operators

You are the "operator" liable for collecting and remitting the Parking Excise Tax unless an exemption applies. When you contract with a booking intermediary, check exactly how the intermediary structures its invoice to your customer. If the intermediary's cut is folded into one lump total (not separately stated), you must report tax on the customer's full payment — not the net amount the intermediary actually pays you. Getting this wrong understates your Line 1 gross receipts.

Using a booking intermediary that charges a separately stated fee

If your booking intermediary breaks out its service/convenience/facilitation fee as its own line item, the tax liability splits: you owe tax only on your own parking charge, and the intermediary owes tax on its fee. Under 86 Ill. Adm. Code 195.135, the intermediary must register (and is liable for the tax on the whole reservation) if it facilitates business for an operator that isn't registered under the Act, or if it charges a separately stated service fee at all.

No resale exemption, but a credit against double taxation

The Act doesn't have a resale exemption for someone who buys parking space intending to resell it. But if tax on the same parking transaction has already been paid or remitted by another registered operator, you can claim a credit for that amount — provided you can document it (an invoice stating "tax paid" or "all taxes included" is enough).

Filing mechanics

Operators report the Parking Excise Tax on Form PE-100, due on or before the last day of each calendar month for the prior month's parking purchases.

Common questions

Q: My booking intermediary says it isn't required to collect or file Illinois sales tax — does that get my garage off the hook?
A: No. The Parking Excise Tax is a distinct tax from sales tax, and as the "operator" of the parking area or garage, you're generally the one required to collect and remit it (unless the fee is separately stated and the intermediary itself owes tax on that piece, or the intermediary must register because it deals with an unregistered operator).

Q: What counts toward "purchase price" for the tax?
A: Everything the customer pays to obtain the parking space, valued in money, without deducting for costs — including markups, service fees, convenience fees, facilitation fees, cancellation fees, and overtime fees, no matter what they're labeled.

Q: Are payment processors or booking intermediaries themselves "operators"?
A: Generally no. Banks, credit card companies, payment processors, and booking intermediaries are excluded from the "operator" definition, except that a booking intermediary becomes liable for the tax on a reservation for an unregistered operator, or on its own separately stated service fee.

Q: Can I get credit if tax on the same parking space was already paid by someone else?
A: Yes — if another registered operator already paid or remitted the Parking Excise Tax on the same transaction or use of the same space, you can claim a credit, but you bear the burden of proving it (e.g., with an invoice stating "tax paid" or "all taxes included").

Q: Where do I report and pay this tax?
A: On Form PE-100, filed with and remitted to the Department by the last day of each calendar month, covering the prior month's parking purchases.

Citations and references

Statute:

• 35 ILCS 525/10-5 (definition of "operator")

Regulations (86 Ill. Adm. Code 195):

• 195.100 (imposition of the tax)
• 195.105 (definitions: purchase price, operator, booking intermediary)
• 195.110(a) (tax rates: 6% hourly/daily/weekly, 9% monthly/annual)
• 195.110(c) (credit for tax already paid/remitted by another registered operator)
• 195.110(d) (no resale exemption)
• 195.110(l) (payment processors/similar functions excluded from "operator")
• 195.110(m)(2)-(3) (booking intermediary liability for unregistered operators and separately stated service fees, with worked examples)
• 195.135 (booking intermediary registration requirement, effective January 1, 2024)

Source

• Landing page: https://taxarchive.illinois.gov/research/legal/letter-rulings/sales-tax/2025.html
• Original PDF: https://tax.illinois.gov/content/dam/soi/en/web/taxarchive/research/legal/letter-rulings/sales-tax/2025/st25-0025-gil.pdf

Original ruling text

ST 25-0025-GIL

4/24/2025

PARKING EXCISE TAX

This letter discusses the Parking Excise Tax. 35 ILCS 525; 86 Ill. Adm. Code 195.
(This is a GIL.)
April 24, 2025
NAME
COMPANY1
EMAIL
Dear NAME:
This letter is in response to your email dated April 10, 2025, in which you requested
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
https://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:
I am looking for some clarification on parking excise tax collection
responsibilities. We started using an intermediary service from COMPANY2.
They charge %%% service fee off the customer invoice total. It appears they
are not collecting/accounting for sales tax. My question is which amount
should I add to Line 1 of Step 1 the gross receipts collected ? COMPANY2
collects $$$ from a customer and pays us $$$. Should we add $$$ or $$$ to
our gross receipts?
COMPANY2 claims that they are not required to collect/file sales taxes in
Illinois.
DEPARTMENT’S RESPONSE:
The Illinois Parking Excise Tax Act (the “Act”) imposes a Parking Excise Tax (the “Tax”)
effective January 1, 2020 “on the privilege of using in this State a parking space in a parking

COMPANY2
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April 24, 2025
area or garage”. 86 Ill. Adm. Code 195.100. The tax is imposed at the rate of 6% of the
purchase price for a parking space paid for on an hourly, daily, or weekly basis; and 9% of
the purchase price for a parking space paid for on a monthly or annual basis. 86 Ill. Adm.
Code 195.110(a).
“Purchase price” means the consideration paid for the purchase of a parking
space in a parking area or garage, valued in money, whether received in money
or otherwise, including cash, gift cards, credits, and property, and shall be
determined without any deduction on account of the cost of materials used,
labor or service costs, or any other expense whatsoever. “Purchase price”
includes any and all charges that the recipient pays related to or incidental to
obtaining the use or privilege of using a parking space in a parking area or
garage, including but not limited to any and all related markups, service fees,
convenience fees, facilitation fees, cancellation fees, overtime fees, or other
such charges, regardless of terminology.
86 Ill. Adm. Code 195.105.
The Tax is on the purchaser of the parking and must be collected by the operator. 86
Ill. Adm. Code 195.110(a). Under the Act, an “operator” required to collect the Tax is any
“person who engages in the business of operating a parking area or garage, or who, directly
or through an agreement or arrangement with another party, collects the consideration for
parking . . .” 35 ILCS 525/10-5. “Operator” does not include a bank, credit card company,
payment processor, booking intermediary (except as stated below), or person whose
involvement is limited to performing functions that are similar to those performed by a bank,
credit card company, payment processor, or booking intermediary. 86 Ill. Adm. Code
195.105.
A “booking intermediary” is any person or entity that facilitates the processing and
fulfillment of reservation transactions between an operator and a person or entity desiring
parking in a parking lot or garage of that operator. 86 Ill. Adm. Code 195.105. Beginning
January 1, 2024, a booking intermediary must register under the Act if it facilitates the
processing and fulfillment of a reservation for an operator that is not registered under the
Act, or if it charges a separately stated service fee. 86 Ill. Adm. Code 195.135. The booking
intermediary is liable for and must remit the tax on any reservation facilitated for an
unregistered operator. 86 Ill. Adm. Code 195.110(m)(2). Similarly, the booking intermediary
is liable for and must remit the tax on any separately stated service fee that the booking
intermediary charges to the customer. In this situation, the operator is liable for and must
remit the tax on the remainder of the purchase price for the transaction. 86 Ill. Adm. Code
195.110(m)(3).

COMPANY2
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April 24, 2025
The Department’s Administrative Rule at 86 Ill. Adm. Code 195.110(m)(3) provides
the following examples to demonstrate an operator’s tax liability when a booking
intermediary includes an additional service fee:
EXAMPLE 1: A booking intermediary charges and collects $40 from a
purchaser for the use of a parking space in a registered operator's garage. The
$40 includes a charge of $35 set by the operator to use the parking space in
the operator's garage and a charge of $5 that is imposed and retained by the
booking intermediary for facilitating the use of the parking space by the
purchaser. The $5 charge is not separately stated. Per the agreement
between the operator and the booking intermediary, the booking intermediary
receives a 20% commission on each parking space it facilitates on behalf of
the operator (.20 x $35 = $7). The booking intermediary forwards $28 to the
operator. The operator has a parking excise tax liability of $2.40 (.06 x $40).
EXAMPLE 2: A booking intermediary charges and collects $25 from a
purchaser for the use of a parking space in a registered operator's garage. The
$25 includes a charge of $20 set by the operator to use the parking space in
the operator's garage and a separately stated service charge of $5 imposed
and retained by the booking intermediary for facilitating the use of the parking
space by the purchaser. Per the agreement between the operator and the
booking intermediary, the booking intermediary receives a 15% commission
on each parking space it rents on behalf of the operator (.15 x $20 = $3). The
booking intermediary forwards $17 to the operator. The operator has a parking
excise tax liability of $1.20 (.06 x $20). The booking intermediary has a parking
excise tax liability of $0.30 (.06 x $5).
86 Ill. Adm. Code 195.110(m)(3).
A person that provides payment processing, collection functions, parking area
maintenance, or security functions is not an operator subject to the tax when:
1)

all parking revenues flow directly to the operator;

2)

the operator sets the parking rates;

3)

the person is paid a separate fee for the service provided; and

4)

the sign at the parking area or garage does not identify the person as the
operator.

86 Ill. Adm. Code 195.110(l).

COMPANY2
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April 24, 2025
The operator of a parking area or garage must collect the tax on the purchase of all
parking spaces in a parking area or garage unless the operator is exempt from collecting the
tax or the tax is not due on the transaction. The Act does not contain a resale exemption for
purchases of parking space by a person that intends to resell the parking space to a
customer. 86 Ill. Adm. Code 195.110(d). However, an operator that has paid or remitted the
tax imposed by the Act to another operator in connection with the same parking transaction,
or the use of the same parking space, is entitled to a credit for the tax paid or remitted against
the amount of tax owed under the Act, provided that the other operator is registered under
the Act. The operator claiming the credit shall have the burden of proving it is entitled to
claim a credit. An invoice to the operator that separately states “tax paid” or states “all taxes
included” is sufficient documentation to permit the operator to claim the credit. 86 Ill. Adm.
Code 195.110(c).
Operators must report Parking Excise Tax on Form PE-100 and file the form with and
remit the tax collected to the Department on or before the last day of each calendar month
for all purchases of parking made during the preceding calendar month. For more
information on the Parking Excise Tax Act, see the Department’s Administrative Rules at 86
Ill. Adm. Code 130.195; Form PE-100 Instructions; FY 2020-07; and the Department’s
Frequently Asked Questions, available on the Department’s website.
I hope this information is helpful. If you require additional information, please visit
our website at https://tax.illinois.gov/ or contact the Department’s Taxpayer Information
Division at 800-732-8866.
Very truly yours,
Alexis K. Overstreet
General Deputy Counsel
AKO:sce