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The Michigan Department of Treasury found a concrete manufacturer liable for use tax on the use of pump trucks, tanker trailers, and a Smith trailer. The vehicles were not being used to mix and agitate materials at a plant or job site; instead, the tanker trailers and the Smith trailer were only used to transport cement powder and sand and gravel to the batch plant. Furthermore, the pump trucks transported concrete from the concrete mixer trucks to the job sites and no new material was added directly to the pump trucks for mixing. The pump trucks only agitated the materials, and thus, like the trailers, were taxable for Michigan use tax. (Hunderman & Sons Redi-Mix, Inc. v. Michigan Department of Treasury, Michigan Tax Tribunal, No. 342101)


Effective April 1, 2009, medical care serviced by a managed care entity, including Medicaid, is subject to Michigan use tax. (Act 440 (H.B. 5192), Laws 2009, effective January 9, 2009)


Effective January 6, 2009, the sale of machinery that is capable of simultaneously harvesting grain or other crops and biomass and machinery used for the purpose of harvesting biomass is exempt from Michigan sales tax. For this exemption, “biomass” is defined as crop residue used to produce energy or agricultural crops grown specifically for the production of energy. Sales of such machinery must be made to persons engaged in a business enterprise to qualify for the exemption. (Act 415 (H.B. 5862, Laws 2009, effective January 6, 2009)


The Michigan Department of Treasury denied a taxpayer’s request for a use tax refund. The State found that even though the taxpayer, a publisher and distributor of telephone directories, outsourced the printing and distribution services, they never ceased total control over the directories while being transported and distributed. The taxpayer exercised “a right or power over the tangible personal property” in Michigan, and was therefore subject to its use tax. In addition, the Department determined that the price of the directories, which encompassed the cost of the paper and printing services, was to be included in the use tax calculation. (Ameritech Publishing, Inc. v. Department of Treasury, Michigan Court of Appeals, No. 276374, August 7, 2008)


Governor Jennifer Granholm signed HB 5408 on December 1, 2007. This law creates a business tax surcharge that replaces the service tax originally set under HB 5198. The law to repeal the use tax on select services was signed just hours after the original law went into effect. Services originally targeted included: consulting services, office administration services, business service center services, investment advice services, landscaping services, travel and reservation services, carpet/upholstery cleaning services, warehousing and storage services, packaging and labeling services, specialized design services, courier and messenger services, janitorial services and certain personal and personal care services. The new law, effective December 1, 2007, provides that businesses that charged and collected the 6% use tax on services, before the law was repealed on December 1st, can either refund that money to the purchaser/user of the service or remit the revenue to the State of Michigan when the first Use Tax payment is due. (H.B. 5408, December 1, 2007, Michigan Department of Revenue)



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