September 12, 2007, Introduced by Senator BRATER and referred to the Committee on Finance.
A bill to amend 1933 PA 167, entitled
"General sales tax act,"
by amending sections 2 and 6a (MCL 205.52 and 205.56a), section 2
as amended by 2004 PA 173 and section 6a as amended by 1993 PA 325.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. (1) Except as provided in section 2a, there is levied
upon and there shall be collected from all persons engaged in the
business of making sales at retail, by which ownership of tangible
personal property is transferred for consideration, an annual tax
for the privilege of engaging in that business equal to 6%, of the
gross proceeds of the business, plus the penalty and interest if
applicable as provided by law, less deductions allowed by this act.
(2) The tax under subsection (1) also applies to the
following:
(a) The transmission and distribution of electricity, whether
the electricity is purchased from the delivering utility or from
another provider, if the sale is made to the consumer or user of
the electricity for consumption or use rather than for resale.
(b) The sale of a prepaid telephone calling card or a prepaid
authorization number or code for telephone use, rather than for
resale, including the reauthorization of a prepaid telephone
calling card or a prepaid authorization number or code.
(c) A conditional sale, installment lease sale, or other
transfer of property, if title is retained as security for the
purchase but is intended to be transferred later.
(3) Any person engaged in the business of making sales at
retail who is at the same time engaged in some other kind of
business, occupation, or profession not taxable under this act
shall keep books to show separately the transactions used in
determining the tax levied by this act. If the person fails to keep
separate books, there shall be levied upon him or her the tax
provided for in subsection (1) equal to 6% of the entire gross
proceeds of both or all of his or her businesses. The taxes levied
by this section are a personal obligation of the taxpayer.
(4) A meal provided free of charge or at a reduced rate to an
employee during work hours by a food service establishment licensed
by the Michigan department of agriculture for the convenience of
the employer is not considered transferred for consideration.
Sec. 6a. (1) At the time of purchase or shipment from a
refiner, pipeline terminal operator, or marine terminal operator, a
purchaser or receiver of gasoline shall prepay a portion of the tax
imposed by this act at the rate provided in this section to the
refiner, pipeline terminal operator, or marine terminal operator
for the purchase or receipt of gasoline. If the purchase or receipt
of gasoline is made outside this state for shipment into and
subsequent sale within this state, the purchaser or receiver, other
than a refiner, pipeline terminal operator, or marine terminal
operator, shall make the prepayment required by this section
directly to the department. Prepayments shall be made at a cents
per gallon rate determined by the department and shall be based on
6% of the statewide average retail price of a gallon of self-serve
unleaded regular gasoline as determined and certified by the
department rounded up to the nearest 1/10 of 1 cent. A person who
makes prepayments direct to the department shall make those
prepayments according to the schedule in subsection (5).
(2) The rate of prepayment applied pursuant to subsection (1)
shall be determined every 6 months by the department unless the
department certifies that the change in the statewide average
retail price of a gallon of self-serve unleaded regular gasoline
has been less than 10% during the 6-month period. However, the rate
shall be determined not less than annually.
(3) A person subject to tax under this act who makes
prepayment to another person as required by this section may claim
an estimated prepayment credit on its regular monthly return filed
pursuant to section 6. The credit shall be for prepayments made
during the month for which the return is required and shall be
based upon the difference between prepayments made in the
immediately preceding month and collections of prepaid tax received
from sales or transfers. A sale or transfer for which collection of
prepaid tax is due the taxpayer is subject to a bad debt deduction
under section 4i, whether or not the sale or transfer is a sale at
retail. The credit shall not be reduced because of actual
shrinkage. A taxpayer who does not, in the ordinary course of
business sell gasoline in each month of the year, may, with the
approval of the department, base the initial prepayment deduction
in each tax year on prepayments made in a month other than the
immediately
preceding month. Estimated prepayment credits claimed
with
the return due in January 1984 shall be based on the
taxpayer's
retail sales of gasoline in December 1983. The
difference in actual prepayments shall be reconciled on the annual
return in accordance with procedures prescribed by the department.
(4) At the option of the taxpayer the estimated prepayment
credit
may be claimed on the return required to be filed under Act
No.
150 of the Public Acts of 1927, being sections 207.101 to
207.202
of the Michigan Compiled Laws the motor fuel tax act, 2000
PA 403, MCL 207.1001 to 207.1170, instead of a claim for the credit
on the return required to be filed under section 6. Prepayments
claimed on the motor fuel tax return shall be based on the
difference in the prepayments made in the immediately preceding
month and collections of prepaid tax received from sales or
transfer and shall be for prepayments made in the month in which
the return is due. A taxpayer electing an option under this
subsection shall be entitled to a deduction under section 4i as
permitted by subsection (3). Amounts credited pursuant to this
section shall not be deducted from amounts required to be credited
to
the Michigan transportation fund pursuant to section 18b of
Act
No.
150 of the Public Acts of 1927, being section 207.118b of the
Michigan Compiled Laws 143 of the motor fuel tax act, 2000 PA 403,
MCL 207.1143. The department may establish procedures for the
election of claims under subsection (3) and this subsection to
avoid duplication of claims.
(5) Notwithstanding the other provisions for the payment and
remitting of tax due under this act, a refiner, pipeline terminal
operator, or marine terminal operator shall account for and remit
to the department the prepayments received pursuant to this section
in accordance with the following schedule:
(a) On or before the twenty-fifth of each month, prepayments
received after the end of the preceding month and before the
sixteenth of the month in which the prepayments are made.
(b) On or before the tenth of each month, payments received
after the fifteenth and before the end of the preceding month.
(6) A refiner, pipeline terminal operator, or marine terminal
operator who fails to remit prepayments made by a purchaser or
receiver
of gasoline is subject to the penalties provided by Act
No.
122 of the Public Acts of 1941, being sections 205.1 to 205.31
of
the Michigan Compiled Laws 1941
PA 122, MCL 205.1 to 205.31.
(7) The refiner, pipeline terminal operator, or marine
terminal operator shall not receive a deduction under section 4 for
receiving and remitting prepayments from a purchaser or receiver
pursuant to this section.
(8) The purchaser or receiver of gasoline who makes
prepayments is not subject to further liability for the amount of
the prepayment if the refiner, pipeline terminal operator, or
marine terminal operator fails to remit the prepayment.
(9) As used in this section:
(a) "Marine terminal operator" means a person who stores
gasoline at a boat terminal transfer defined as a dock, a tank, or
equipment contiguous to a dock or a tank, including equipment used
in the unloading of gasoline from a ship and in transferring the
gasoline to a tank pending wholesale bulk reshipment.
(b) "Pipeline terminal operator" means a person who stores
gasoline in tanks and equipment used in receiving and storing
gasoline from interstate and intrastate pipelines pending wholesale
bulk reshipment.
(c) "Purchase" or "shipment" does not include an exchange of
gasoline, or an exchange transaction, between refiners, pipeline
terminal operators, or marine terminal operators.
(d) "Refiner" means a person who manufactures or produces
gasoline by any process involving substantially more than the
blending of gasoline.