September 7, 2007, Introduced by Rep. Tobocman and referred to the Committee on Tax Policy.
A bill to amend 1933 PA 167, entitled
"General sales tax act,"
by amending section 1 (MCL 205.51), as amended by 2004 PA 173, and
by adding section 9a; and to repeal acts and parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. (1) As used in this act:
(a) "Person" means an individual, firm, partnership, limited
partnership, limited liability company, joint venture, association,
social club, fraternal organization, municipal or private
corporation whether organized for profit or not, company, estate,
trust, receiver, trustee, syndicate, the United States, this state,
county, or any other group or combination acting as a unit, and
includes the plural as well as the singular number, unless the
intention to give a more limited meaning is disclosed by the
context.
(b) "Sale at retail" or "retail sale" means a sale, lease, or
rental of tangible personal property for any purpose other than for
resale, sublease, or subrent.
(c) "Gross proceeds" means sales price.
(d) "Sales price" means 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, and applies to
the measure subject to sales tax. Sales price includes the
following subparagraphs (i) through (vi) and excludes subparagraphs
(vii) through (viii):
(i) Seller's cost of the property sold.
(ii) Cost of materials used, labor or service cost, interest,
losses, costs of transportation to the seller, taxes imposed on the
seller other than taxes imposed by this act, and any other expense
of the seller.
(iii) Charges by the seller for any services necessary to
complete the sale, other than the following:
(A) An amount received or billed by the taxpayer for
remittance to the employee as a gratuity or tip, if the gratuity or
tip is separately identified and itemized on the guest check or
billed to the customer.
(B) Labor or service charges involved in maintenance and
repair work on tangible personal property of others if separately
itemized.
(iv) Delivery charges incurred or to be incurred before the
completion of the transfer of ownership of tangible personal
property from the seller to the purchaser.
(v) Installation charges incurred or to be incurred before the
completion of the transfer of ownership of tangible personal
property from the seller to the purchaser.
(vi) Credit for any trade-in.
(vii) Interest, financing, or carrying charges from credit
extended on the sale of personal property or services, if the
amount is separately stated on the invoice, bill of sale, or
similar document given to the purchaser.
(viii) Any taxes legally imposed directly on the consumer that
are separately stated on the invoice, bill of sale, or similar
document given to the purchaser.
(e) "Business" includes an activity engaged in by a person or
caused to be engaged in by that person with the object of gain,
benefit, or advantage, either direct or indirect.
(f)
"Tax year" or "taxable year" means the fiscal year of the
this state or the taxpayer's fiscal year if permission is obtained
by the taxpayer from the department to use the taxpayer's fiscal
year as the tax period instead.
(g) "Department" means the department of treasury.
(h) "Taxpayer" means a person subject to a tax under this act.
(i) "Tax" includes a tax, interest, or penalty levied under
this act.
(j) "Textiles" means goods that are made of or incorporate
woven or nonwoven fabric, including, but not limited to, clothing,
shoes, hats, gloves, handkerchiefs, curtains, towels, sheets,
pillows, pillow cases, tablecloths, napkins, aprons, linens, floor
mops, floor mats, and thread. Textiles also include materials used
to repair or construct textiles, or other goods used in the rental,
sale, or cleaning of textiles.
(2) If the department determines that it is necessary for the
efficient administration of this act to regard an unlicensed
person, including a salesperson, representative, peddler, or
canvasser as the agent of the dealer, distributor, supervisor, or
employer under whom the unlicensed person operates or from whom the
unlicensed person obtains the tangible personal property sold by
the unlicensed person, irrespective of whether the unlicensed
person is making sales on the unlicensed person's own behalf or on
behalf of the dealer, distributor, supervisor, or employer, the
department may so regard the unlicensed person and may regard the
dealer, distributor, supervisor, or employer as making sales at
retail at the retail price for the purposes of this act.
Sec. 9a. (1) Any other provision of this act notwithstanding,
the department may establish a pilot program in which both of the
following occur:
(a) A person selected under subsection (2) shall
electronically submit a return for each sale at retail to the
department or the department's designee. The return shall show the
entire amount of the sale at retail, the gross proceeds from that
sale at retail, the allowable deductions, if any, and the amount of
tax for which the person is liable on that sale at retail. The
return shall include the remittance for the amount of tax for which
the person is liable on that sale at retail.
(b) The department or the department's designee shall issue an
electronically generated receipt to each customer of a taxpayer
liable for submitting a return under subdivision (a). The receipt
shall indicate that the taxpayer has electronically reported to the
department or the department's designee the entire amount of the
sale at retail, the gross proceeds from that sale at retail, the
allowable deductions, if any, the amount of tax for which he or she
is liable on that sale at retail, and the amount of tax remitted
for that sale at retail.
(2) The department may randomly select interested taxpayers to
participate in the pilot program under this section.
Enacting section 1. Sections 4y and 4z of the general sales
tax act, 1933 PA 167, MCL 205.54y and 205.54z, are repealed.