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Michigan’s New Amazon Tax Law Takes Effect October 2015

  • Jan 19, 2015 | Gail Cole

 Michigan enacts remote sales tax legislation.

It’s official. Numerous Internet retailers will have to start collecting Michigan sales tax on October 1, 2015. Michigan is the 23rd state in the union to enact such a law.

Governor Rick Snyder (R) on January 15 signed legislation that he said “levels the playing field for local businesses, helping Michigan job providers better compete with online retailers.” The enactment of Senate Bills 658 and 659 is expected to generate approximately $60 million in Fiscal Year 2016 alone. Details are available here.

Critics have called the laws “a tax increase that will raise prices.” Gov. Snyder disagrees, calling it a “collection issue” rather than a tax increase. Michigan residents who do not pay Michigan sales tax on goods purchased remotely (such as online or by catalog) are supposed to voluntarily remit Michigan use tax on the purchase price. Few do.

While states act on Internet sales tax, federal lawmakers continue to dance around the issue—most recently by introducing a discussion draft for an online sales tax based on origin sourcing.

Growing businesses risk triggering sales tax in multiple states. Automated sales tax Software-as-a-Service (SaaS) reduces the risk of noncompliance and facilitates transaction tax management in multiple states. Learn more.

photo credit: alles-schlumpf via photopin cc

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.