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Michigan Lawmakers Consider Internet Sales Tax

  • Dec 10, 2014 | Gail Cole

 Maybe in Michigan.

For a time, it seemed that Congress might finally take up the issue of online sales tax during the lame duck session. Then House Speaker John Boehner said that wouldn’t happen. With the House and Senate scheduled to recess for the year by December 12, and with important issues like avoiding a government shutdown still on the table, it seems safe to say that there will be no federal internet sales tax legislation this year.

That’s not stopping Michigan lawmakers from tackling the issue at the state level, where proposed online sales tax legislation is “gaining steam.” Yesterday, two bills were placed on order of the Third Reading of Bills and they could come up for vote this week, perhaps even later today.

House Bills 4202 and 4203 would require out-of-state online retailers to collect and remit Michigan’s 6% sales tax, as brick-and-mortar companies are required to do. Representative Rob VerHeulen, sponsor of one of the bills, said the following:

  • “It’s not a revenue generator. That tax is owed. It’s simply a question of fundamental fairness.”
  • “Why now? ... It’s not happening in Washington. …They’re not going to act, so let us take this step.”
  • “The market will determine whether the consumers want to go to a brick-and-mortar or online. But it’s our obligation to create a level playing field so that the competition is legitimate….”

Neither bill will slide unopposed into law, however. The Tea Party and Americans for Tax Reforms are against remote sales tax legislation. And Former Republican Representative Jack Hoogendyk is urging supporters to contact their legislators and “Let your opinion be known!” He says the people of Michigan will pay more taxes if the bills are enacted.

Proponents of internet sales tax will tell you that it is not a new tax; use tax stole tax-free internet shopping (and catalogue shopping, etc.) a long time ago.

Although the bills face opposition, they also have bipartisan support. Republican Representative Eileen Kowall thinks it shouldn’t be “a conservative value to be a tax scofflaw.” And Senate Majority Leader Randy Richardville (R) said he though internet sales and use tax legislation “could and should happen.”

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.