Use tax: exemptions; offset of the trade in value of personal electronics; provide for. Amends sec. 2 of 1937 PA 94 (MCL 205.92).
Senate Bill 972 amends Michigan’s Use Tax Act to add a new definition and tax treatment for portable electronic devices. Specifically, it allows a credit against the taxable purchase price when a customer trades in a portable electronic device as part payment for a new or used portable electronic device purchased from a retailer that sells such devices. The trade-in value must be separately stated on the invoice or similar document. The bill defines a portable electronic device broadly as a portable electronic device and related accessories.
The bill also includes a separate set of provisions addressing delivery and installation charges under the use tax act. It directs the Department of Treasury to cancel certain outstanding assessments and balances related to delivery and installation charges that were issued before April 26, 2023, and bars the department from issuing new assessments for those charges for earlier tax periods still open under the statute of limitations. The bill excludes delivery and installation charges involving electricity, natural gas, or artificial gas sold by a utility. The act would only take effect if a related companion bill is enacted.
The bill would amend MCL 205.92, the definition section of Michigan’s Use Tax Act, by adding a trade-in credit for portable electronic devices and by clarifying how certain delivery and installation charges are treated for tax assessment purposes. It would reduce the taxable base for qualifying phone, tablet, and similar device trade-ins, affecting retailers, consumers, and the calculation of use tax on those transactions. It would also require the Department of Treasury to cancel or stop pursuing certain pre-April 26, 2023 assessments tied to delivery and installation charges, limiting the state’s ability to collect those amounts under the use tax act.
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate or formal support/opposition in the available materials. Based on the bill text and caption, the measure appears to be a targeted tax relief and administrative clarification bill, which typically draws support from consumers and affected retailers while potentially drawing concern from tax administrators because it narrows the tax base and requires cancellation of some assessments.
The main policy issues are the new trade-in credit for portable electronics and the retroactive cancellation of assessments for delivery and installation charges. Supporters would likely favor the consumer tax relief and the clarification of tax treatment for device trade-ins, while opponents or concerned parties may focus on lost revenue, the retroactive nature of the assessment cancellations, and the administrative burden on Treasury. The bill also explicitly excludes utility-related delivery and installation charges, indicating a carve-out that may matter to utilities and taxpayers in those sectors.