HOUSE BILL No. 4891


     September 28, 1999, Introduced by Rep. Bisbee and referred to the Committee on Tax
Policy.


        A bill to amend 1933 PA 167, entitled

   "General sales tax act,"

   by amending section 17 (MCL 205.67), as amended by 1995 PA 254.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 1         Sec. 17.  A person liable for any tax imposed under this act

 2    shall keep accurate and complete beginning and annual inventory

 3    and purchase records of additions to inventory, complete daily

 4    sales records, receipts, invoices, bills of lading, and all per-

 5    tinent documents in a form the department requires.  If an exemp-

 6    tion from sales tax is claimed because the sale is for resale or

 7    for any of the other exemptions or deductions granted under this

 8    act, a record shall be kept of the name and address of the person

 9    to whom the sale is made, the date of the sale, the article

10    purchased, the  use to be made of the article, and 
             TYPE OF

11    EXEMPTION CLAIMED, the amount of the sale, and, if that person


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 1    has a sales tax license,  that  THE SALES TAX
             LICENSE number.

 2     shall also be included.  If a taxpayer maintains
             the records

 3    required under this section, and accepts an exemption certificate

 4    from the buyer in good faith on a form prescribed by the depart-

 5    ment, the taxpayer is not liable for collection of the unpaid tax

 6    after a finding that the sale did not qualify for exemption under

 7    this act.  As used in this section, "good faith" means that the

 8    taxpayer  exercised reasonable care and effort to determine
             that

 9     the purchaser was entitled to the exemption being claimed
                       

10    RECEIVED A COMPLETED AND SIGNED EXEMPTION CERTIFICATE FROM THE

11    BUYER.  A person knowingly making a sale of tangible personal

12    property for the purpose of resale at retail to another person

13    not licensed under this act is liable for the tax imposed under

14    this act unless the transaction is exempt under the provisions of

15    section 4k.  These records must be retained for a period of 4

16    years after the tax imposed under this act to which the records

17    apply is due or as otherwise provided by law.  If the department

18    considers it necessary, the department may require a person, by

19    notice served upon that person, to make a return, render under

20    oath certain statements, or keep certain records the department

21    considers sufficient to show whether or not that person is liable

22    for tax under this act.  If the taxpayer fails to file a return

23    or to maintain or preserve proper records as prescribed in this

24    section, or the department has reason to believe that any records

25    maintained or returns filed are inaccurate or incomplete and that

26    additional taxes are due, the department may assess the amount of

27    the tax due from the taxpayer based on information that is



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 1    available or that may become available to the department.  That

 2    assessment is considered prima facie correct for the purpose of

 3    this act and the burden of proof of refuting the assessment is

 4    upon the taxpayer.  For purposes of this section, exemption cer-

 5    tificate includes a blanket exemption certificate on a form pre-

 6    scribed by the department that covers all exempt transfers

 7    between the taxpayer and the buyer for a period of  3
              4 years or

 8    for a period of less than  3  4 years as stated on
             the blanket

 9    exemption certificate if that period is agreed to by the buyer

10    and taxpayer.




































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