Michigan House Republicans
Rep. Outman’s plan to improve Michigan’s sales and use tax codes signed into law
RELEASE|April 26, 2023
Contact: Pat Outman

State Rep. Pat Outman’s plan to make Michigan’s tax codes clearer and fairer for Michigan businesses was signed into state law today.

Many Michigan retailers were experiencing confusion with the state’s inconsistent and unclear sales and use tax laws. Oftentimes, when the Department of Treasury audited those retailers, it concluded that retailers must pay sales and use taxes that were not collected on delivery and installation. In some cases, this forced retailers to go to court to appeal audit findings because they believe they followed proper procedures to ensure their delivery and installation services would not be subject to sales and use tax.

Outman introduced a bill to clarify the law because he believed sales and use tax should only be applied to the purchase of the tangible good and not the services related to that purchase.

“I’m pleased to see this bipartisan plan signed into law today,” said Outman (R-Six Lakes). “Delivery and installation are services – not products. They shouldn’t be subject to sales and use tax. No longer will the Department of Treasury be able to use this part of the tax code to impede on the success of Michigan’s small businesses.”

House Bill 4039 is part of a larger package of bipartisan-supported tax code reforms introduced by Republicans that were signed into law today. Outman’s legislation is now Public Act 20 of 2023.

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