Legislative Analysis
Phone: (517) 373-8080
AMEND DEFINITON OF CONVERTED VEHICLE
http://www.house.mi.gov/hfa
Senate Bill 326 (S-2) as reported from House committee Analysis available at
Sponsor: Sen. Sam Singh http://www.legislature.mi.gov
House Committee: Insurance and Financial Services
Senate Committee: Finance, Insurance, and Consumer Protection
Complete to 6-21-23
(Enacted as Public Act 94 of 2023)
SUMMARY:
Senate Bill 326 would amend the Use Tax Act to change when a vehicle purchased for resale
is converted, or changed from a tax-exempt use to a non-exempt use.
Currently, a motor vehicle that is purchased for resale by a new vehicle dealer licensed under
section 248(8)(a) of the Michigan Vehicle Code 1 is not considered to be converted if the vehicle
is not titled in the name of the dealer before the sale or lease by the dealer. The bill would
change this provision so a vehicle would not be considered converted if it is not registered in
the name of the dealer before the sale or lease.
MCL 205.92
BACKGROUND:
According to committee testimony, the secretary of state is slated to switch to an electronic
titling system in October of 2023 under which many cars purchased by dealers for resale will
have an electronic title. The bill is intended to update the Use Tax Act to ensure that these
vehicles purchased for resale remain exempt under the act.
FISCAL IMPACT:
As written, the bill would exempt transfers of ownership traditionally untaxed by the secretary
of state that might be subject to tax as a result of the implementation of a new filing system.
By exempting these transfers, the bill would not change existing revenue forecasts.
POSITIONS:
A representative of Auto Dealers of Michigan testified in support of the bill (6-8-23).
Legislative Analyst: Alex Stegbauer
Fiscal Analyst: Jim Stansell
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
1
http://legislature.mi.gov/doc.aspx?mcl-257-248
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Statutes affected:
Substitute (S-2): 205.92
Senate Introduced Bill: 205.92
As Passed by the Senate: 205.92
As Passed by the House: 205.92
Public Act: 205.92
Senate Enrolled Bill: 205.92