SENATE BILL No. 659

 

 

October 31, 2013, Introduced by Senators ANANICH and WHITMER and referred to the Committee on Economic Development.

 

 

 

     A bill to amend 1937 PA 94, entitled

 

"Use tax act,"

 

(MCL 205.91 to 205.111) by adding section 3g.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 3g. (1) Subject to subsection (2), a seller is presumed

 

to be required to collect and remit the tax under this act if any

 

of the following conditions are satisfied:

 

     (a) Any other person, other than a common carrier acting in

 

its capacity as a common carrier, that has substantial nexus with

 

this state does any of the following:

 

     (i) Sells a similar line of products as the seller and does so

 

under the same or a similar business name.

 

     (ii) Maintains an office, distribution facility, warehouse,

 

storage place, or similar place of business in this state to

 

facilitate the delivery of property or services sold by the seller


 

to the seller's customers.

 

     (iii) Uses trademarks, service marks, or trade names in this

 

state that are the same or substantially similar to those used by

 

the seller.

 

     (iv) Delivers, installs, assembles, or performs maintenance

 

services for the seller's customers within this state.

 

     (v) Facilitates the seller's delivery of property to customers

 

in this state by allowing the seller's customers to pick up

 

property sold by the seller at an office, distribution facility,

 

warehouse, storage place, or similar place of business maintained

 

by the seller in this state.

 

     (vi) Conducts any other activities in this state that are

 

significantly associated with the seller's ability to establish and

 

maintain a market in this state for the seller's sales.

 

     (b) Any affiliated person has substantial nexus with this

 

state.

 

     (2) The presumptions in subsection (1) may be rebutted by

 

demonstrating that the other person's or affiliated person's

 

activities in this state are not significantly associated with the

 

seller's ability to establish or maintain a market in this state

 

for the seller's sales.

 

     (3) Notwithstanding subsection (1) and except as otherwise

 

provided in subsection (4), beginning 90 days after the effective

 

date of the amendatory act that added this section, a seller is

 

presumed to be required to collect and remit the tax under this act

 

if the seller enters into an agreement with 1 or more persons under

 

which the person, for a commission or other consideration, while


 

within this state directly or indirectly refers potential

 

customers, whether by a link on an internet website, an in-person

 

oral presentation, telemarketing, or by any other means, to the

 

seller, if the cumulative gross receipts from sales by the seller

 

to customers in this state who are referred to the seller by all

 

persons within this state with such an agreement with the seller

 

are more than $10,000.00 during the immediately preceding 12

 

months. This subsection shall apply to a seller without regard as

 

to the date the seller and the other person entered into the

 

agreement. As used in this section, "the immediately preceding 12

 

months" includes the 12 months that occurred before the effective

 

date of the amendatory act that added this section.

 

     (4) The presumption in subsection (3) may be rebutted by

 

submitting proof that the persons with whom the seller has an

 

agreement did not engage in any activity within this state that was

 

significantly associated with the seller's ability to establish or

 

maintain the seller's market in this state during the immediately

 

preceding 12 months. Such proof may include, but is not limited to,

 

sworn written statements from all of the persons in this state with

 

whom the seller has an agreement stating that they did not engage

 

in any solicitation in this state on behalf of the seller during

 

the immediately preceding 12 months, if such statements are

 

provided and obtained in good faith.

 

     (5) Any ruling, agreement, or contract, whether written or

 

oral, express or implied, between a seller and this state's

 

executive branch or any other state agency or department, stating,

 

agreeing, or ruling that the seller is not required to collect and


 

remit the tax under this act despite the presence of a warehouse,

 

distribution center, or fulfillment center in this state that is

 

owned or operated by the seller or an affiliated person is null and

 

void unless specifically approved by a majority vote of the house

 

of representatives and the senate.

 

     (6) If any person sells tangible personal property to this

 

state, a state department, a state agency, or an agent of this

 

state, a state department, or state agency, that person and any

 

affiliated person shall, as a prerequisite for any such sale,

 

comply with all requirements of this act.

 

     (7) As used in this section:

 

     (a) "Affiliated person" means any person that is a member of

 

the same controlled group of corporations as the seller or is a

 

member of any other entity that, notwithstanding its form of

 

organization, bears the same ownership relationship to the seller

 

as a corporation that is a member of the same controlled group of

 

corporations.

 

     (b) "Controlled group of corporations" means that term as

 

defined in section 1563(a) of the internal revenue code, 26 USC

 

1563.