HOUSE BILL No. 6173


     November 30, 2000, Introduced by Rep. Bisbee and referred to the Committee on Tax Policy.


        A bill to amend 1937 PA 94, entitled

   "Use tax act,"

   by amending section 14 (MCL 205.104), as amended by 1986 PA 41.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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           Sec. 14.  (1) A person in the business of selling tangible

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      personal property and liable for any tax imposed under this act

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      shall keep accurate and complete beginning and annual inventory

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      and purchase records of additions to inventory, complete daily

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      sales records, receipts, invoices, bills of lading, and any and

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      all pertinent documents in a form the department  may require 

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      REQUIRES.  If an exemption from this tax is claimed by reason of

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      any of the exemptions or deductions granted under this act, a

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      record shall be kept of the name and address of the person to

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

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      purchased, the use to be made of the article, and the amount of


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      the sale, and if that person has a sales tax license issued under

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      the provisions of the general sales tax act,  Act No. 167 of the

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      Public Acts of 1933, as amended being sections 205.51 to 205.78

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      of the Michigan Compiled Laws, that number shall also be

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      included  1933 PA 167, MCL 205.51 TO 205.78, THE SALES TAX

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      LICENSE NUMBER.  IF A TAXPAYER MAINTAINS THE RECORDS REQUIRED

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      UNDER THIS SECTION, AND ACCEPTS AN EXEMPTION CERTIFICATE FROM THE

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      BUYER IN GOOD FAITH ON A FORM PRESCRIBED BY THE DEPARTMENT, THE

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      TAXPAYER IS NOT LIABLE FOR COLLECTION OF THE UNPAID TAX AFTER A

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      FINDING THAT THE SALE DID NOT QUALIFY FOR EXEMPTION UNDER THIS

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      ACT.  AS USED IN THIS SECTION, "GOOD FAITH" MEANS THAT THE TAX-

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      PAYER RECEIVED A COMPLETED AND SIGNED EXEMPTION CERTIFICATE FROM

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      THE BUYER. Any person knowingly making a sale of tangible per-

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      sonal property for the purpose of resale at retail to another

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      person not licensed under  Act No. 167 of the Public Acts of

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      1933, as amended, shall be  1933 PA 167, MCL 205.51 TO 205.78, IS

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      liable for the tax imposed by this act unless the transaction is

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      exempt under the provisions of section 4h.  These records must be

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      kept for a period of 4 years after the tax imposed under this act

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      to which the records apply is due or as otherwise provided by

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      law.  If the department considers it necessary, the department

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      may require any person, by notice served upon that person, to

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      make a return, render under oath certain statements, or keep cer-

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      tain records the department considers sufficient to show whether

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      or not that person is liable for tax under this act.  If the tax-

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      payer fails to file a return or to maintain or preserve proper

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      records as prescribed in this section, or the department has



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      reason to believe that any records maintained or returns filed

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      are inaccurate or incomplete and that additional taxes are due,

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      the department may assess the amount of the tax due from the tax-

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      payer based on information that is available or that may become

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      available to the department.  That assessment  shall be  IS con-

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      sidered prima facie correct for the purpose of this act and the

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      burden of proof of refuting the assessment  shall be  IS upon the

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      taxpayer.  FOR PURPOSES OF THIS SECTION, EXEMPTION CERTIFICATE

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      INCLUDES A BLANKET EXEMPTION CERTIFICATE ON A FORM PRESCRIBED BY

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      THE DEPARTMENT THAT COVERS ALL EXEMPT TRANSFERS BETWEEN THE TAX-

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      PAYER AND THE BUYER FOR A PERIOD OF 4 YEARS OR FOR A PERIOD OF

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      LESS THAN 4 YEARS AS STATED ON THE BLANKET EXEMPTION CERTIFICATE

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      IF THAT PERIOD IS AGREED TO BY THE BUYER AND TAXPAYER.

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           (2) FOR A PERIOD OF NOT LESS THAN 30 DAYS OR MORE THAN 60

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      DAYS THAT ENDS BEFORE MARCH 1, 2001, AS DESIGNATED BY THE DEPART-

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      MENT, A PERSON LIABLE FOR ANY TAX IMPOSED UNDER THIS ACT IS

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      EXEMPT FROM THE GOOD FAITH REQUIREMENT DESCRIBED IN SUBSECTION

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      (1) IF THAT PERSON SUBMITS TO THE DEPARTMENT COPIES OF ALL SALES

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      TAX EXEMPTION CERTIFICATES FROM BUYERS DESCRIBED IN SUBSECTION

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      (1).

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           (3) A BUYER ELIGIBLE TO CLAIM ANY OF THE EXEMPTIONS OR

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      DEDUCTIONS GRANTED UNDER THIS ACT SHALL REGISTER ON A FORM PRE-

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      SCRIBED BY THE DEPARTMENT.  IF A BUYER FAILS TO SATISFY THE REG-

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      ISTRATION REQUIREMENT 6 MONTHS AFTER EITHER NOTICE TO REGISTER

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      FROM THE DEPARTMENT OR BECOMING ELIGIBLE TO CLAIM AN EXEMPTION OR

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      DEDUCTION UNDER THIS ACT, WHICHEVER IS LATER, THE BUYER IS NOT

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      ENTITLED TO SUBMIT AN EXEMPTION CERTIFICATE CLAIMING AN EXEMPTION



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      OR DEDUCTION OTHERWISE GRANTED BY THIS ACT UNTIL THE BUYER

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      REGISTERS.  AFTER THE DEPARTMENT HAS ISSUED NOTICE TO REGISTER, A

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      NONREGISTERED BUYER SHALL BE ALLOWED TO CLAIM EXEMPTION IN A

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      REFUND CLAIM THAT IS FILED WITH THE DEPARTMENT WITHIN THE TIME

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      PERMITTED UNDER SECTION 27A OF 1941 PA 122, MCL 205.27A.














































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