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Revisions to Michigan Sales and Use Tax Rules
NOTICE REGARDING REVISIONS TO MICHIGAN’S SALES AND USE TAX RULES
Issued: September 13, 2023
On August 11, 2023, substantial revisions to Michigan’s sales and use tax rules took effect. Before these changes were made, Michigan’s sales and use tax rules contained over 80 rules, many of which were promulgated in 1979 and had not been amended since. Due to significant changes to Michigan’s sales and use tax laws since then, due to both legislation and litigation, many of those rules became obsolete in whole or in part. Because promulgated rules generally have the force and effect of law in Michigan, these outdated rules often led to confusion among taxpayers that attempted to rely on them and created administrative burdens for Treasury. The revised rule set addresses these issues by modernizing the rules so that they align with both the current statutory language in the sales and use tax laws and relevant case law.
The revisions to the rules resulted in the amendment of 29 rules, the addition of 2 new rules, and the rescission of 43 rules. To determine whether to recommend a rule for rescission, Treasury utilized the following general framework: If a rule merely restated a statutory provision, had been superseded by statute or case law, was adequately covered by another rule, or was not unique to warrant its continuation because it merely applied settled principles or clear statutory direction to a specific category of transactions or business, Treasury recommended that the rule be rescinded.
Below is a list of the rules which have been amended, added, or rescinded in the Michigan Administrative Code:
Amended: R 205.1, R 205.13, R 205.15, R 205.16, R 205.20, R 205.22, R 205.26, R 205.54, R 205.55, R 205.62, R 205.67, R 205.68, R 205.70, R 205.71, R 205.76, R 205.77, R 205.79, R 205.80, R 205.88, R 205.93, R 205.94, R 205.98, R 205.104, R 205.108, R 205.109, R 205.111, R 205.112, R 205.132, and R 205.137.
Added: R 205.29 and R 205.142.
Rescinded: R 205.8, R 205.52, R 205.56, R 205.57, R 205.58, R 205.60, R 205.63, R 205.64, R 205.66, R 205.72, R 205.73, R 205.75, R 205.78, R 205.81, R 205.83, R 205.84, R 205.89, R 205.90, R 205.91, R 205.92, R 205.97, R 205.99, R 205.100, R 205.101, R 205.102, R 205.106, R 205.107, R 205.110, R 205.113, R 205.114, R 205.115, R 205.116, R 205.117, R 205.118, R 205.119, R 205.124, R 205.126, R 205.130, R 205.131, R 205.133, R 205.134, R 205.135, and R 205.139.
The amended Sales and Use Tax Rules can be found by selecting Treasury’s Bureau of Tax and Economic Policy under the administrative code search tool at: https://www.michigan.gov/lara/bureau-list/moahr/admin-rules.