HB-4855, As Passed House, December 6, 2005
SUBSTITUTE FOR
HOUSE BILL NO. 4855
A bill to amend 1933 PA 167, entitled
"General sales tax act,"
by amending section 4x (MCL 205.54x), as amended by 2004 PA 173.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 4x. (1) A sale to a domestic air carrier of 1 or more of
the following is exempt from the tax under this act:
(a) An aircraft that has a maximum certificated takeoff weight
of at least 6,000 pounds for use solely in the transport of air
cargo, passengers, or a combination of air cargo and passengers.
(b) Parts and materials, excluding shop equipment or fuel,
affixed or to be affixed to an aircraft that has a maximum
certificated takeoff weight of at least 6,000 pounds for use solely
in the transport of air cargo, passengers, or a combination of air
cargo and passengers.
(2) The tax levied under this act does not apply to the sale
of parts or materials, excluding shop equipment or fuel, affixed or
to be affixed to an aircraft that meets all of the following
conditions:
(a) The aircraft leaves this state within 15 days after the
sooner of the issuance of the final billing or authorized approval
for final return to service, completion of the maintenance record
entry, and completion of the test flight and ground test for
inspection as required under 14 CFR 91.407.
(b) The aircraft was not based in this state or registered in
this state before the parts or materials are affixed to the
aircraft and the aircraft is not based in this state or registered
in this state after the parts or materials are affixed to the
aircraft.
(3) The tax levied under this act does not apply to the sale
of an aircraft temporarily located in this state for the purpose of
prepurchase evaluation or the purpose of prepurchase evaluation and
postsale customization if all of the following conditions are
satisfied:
(a) The aircraft leaves this state within 15 days after
authorized approval for final return to service, completion of the
maintenance record entry, and completion of the test flight and
ground test for inspection as required under 14 CFR 91.407.
(b) The aircraft was not based in this state or registered in
this state before the prepurchase evaluation or prepurchase
evaluation and postsale customization are completed and the
aircraft is not based in this state or registered in this state
after the prepurchase evaluation or prepurchase evaluation and
postsale customization are completed.
(4) (2) A sale of an aircraft to a person for subsequent
lease to a domestic air carrier operating under a certificate
issued by the federal aviation administration under 14 CFR 121, for
use solely in the regularly scheduled transport of passengers is
exempt from the tax under this act.
(5) (3) As used in this section: ,
"domestic
(a) "Based in this state" means hangared or stored in this
state for not less than 10 days in not less than 3 nonconsecutive
months during the immediately preceding 12-month period.
(b) "Domestic air carrier" is limited to entities engaged
primarily in the commercial transport for hire of air cargo,
passengers, or a combination of air cargo and passengers as a
business activity.
(c) "Prepurchase evaluation" means an examination of an
aircraft to provide a potential purchaser with information relevant
to the potential purchase.
(d) "Postsale customization" means any improvement,
maintenance, or repair that is performed on an aircraft following a
transfer of ownership of the aircraft.