The bill amends the Use Tax Act of 1937 to update definitions and provisions concerning the taxation of tangible personal property and services in Michigan. Key insertions include expanded definitions for terms such as "person," "use," "storage," "seller," and "purchase," which now cover a wider array of entities and transactions. The bill clarifies that "purchase" includes converting property from an exempt to a taxable use and outlines what constitutes the "purchase price" for tax purposes. It also introduces new language regarding delivery and installation charges, requiring the cancellation of outstanding balances related to these charges for assessments issued before April 26, 2023. Additionally, the bill specifies exemptions from the use tax for property already subject to sales tax, property exempt under federal or state law, and property purchased for resale or demonstration.

Further amendments include new tax exemptions for sales to parent cooperative preschools, vehicles used for religious purposes, and specific agricultural and industrial equipment. The bill also addresses the sale of feminine hygiene products, recreational watercraft, and school buses, detailing the conditions under which these items are exempt from sales tax. It clarifies that exemptions do not apply to transfers of food, fuel, clothing, or similar items intended for personal consumption, with certain exceptions for agricultural equipment. New definitions relevant to the agricultural sector are introduced, and the bill specifies that certain subsections are retroactive but will not apply to refund claims filed before April 9, 2018. The enactment of this amendatory act will take effect 90 days after being signed into law.

Statutes affected:
Senate Introduced Bill: 205.92, 205.94