LEGISLATIVE UPDATE

June 17, 2016

MICHIGAN SB 991 EXCLUDES SALES TAX ON CORES

If passed, Michigan SB 991 would amend the General Sales Tax Act to exclude from taxation a core charge attributable to a recycling fee, deposit, or disposal fee for a motor vehicle or recreational vehicle or battery.

The Act, imposes a tax of 6% on the sales price of nonexempt personal property. The Act defines “sales price” as the total amount of consideration, including cash, credit, property, and services, for which tangible personal property or services are sold, leased, or rented, valued in money, whether received in money or otherwise. The Act lists certain costs, charges, and amounts that are included in the term, and others that are not.

The bill would exclude from the definition of “sales price” a core charge attributed to a recycling fee, deposit, or disposal fee for a motor vehicle or recreational vehicle part or battery.

Per Michigan Senate Bill No. 991;

“.. Sales price includes the following subparagraphs (i) through (viii) and excludes subparagraphs (viii) through (xiii): … “(xiii) A CORE CHARGE ATTRIBUTABLE TO A RECYCLING FEE, DEPOSIT, OR DISPOSAL FEE FOR A MOTOR VEHICLE OR RECREATIONAL VEHICLE PART OR BATTERY.”

MI SB 991 was introduced on May 25, 2016, was referred to Committee of the Whole on June 8, 2016 and is now on the Senate floor.  A copy of the bill is attached for your review and sharing.

Prior to the introduction of this bill, MAPA assisted Senator Curtis Hertel, Jr’s office with a survey related to the amount of sales tax on cores charged/collected in the State of Michigan.  The numbers provided to Hertel’s office were gathered from a portion of MAPA members. Thank you to those who participated.

MAPA encourages you to email your senator and encourage them to pass SB 991. To find your senator, please visit: http://www.senate.michigan.gov/fysbyaddress.html