The state’s Tax Policy Committee voted in Lansing today to mandate the collection of Michigan’s six percent sales tax by any online business that has a presence in the state. The bill could be enacted without a vote of the people because it will not be considered a new tax since Michiganders are already required to pay the tax if the retailer does not collect it during the sales transaction.
Having a physical presence in the state would mean an actual brick and mortar location such as a store, return center or distribution center or if they have a contractor in the state performing some service such as delivery r assembly.
The bill may not bring the desired results. Amazon.com, the largest Internet retailer in the United States will argue that UPS does not qualify as a contractor and that third party sales referrers do not qualify as a physical presence.
In Michigan any new taxes require a popular vote of the residents. By keeping the internet tax equal to the regular state sales tax does not require a ballot initiative.
© Max Impact, used with permission.
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