HB-5621, As Passed House, March 22, 2018
SUBSTITUTE FOR
HOUSE BILL NO. 5621
A bill to amend 1937 PA 94, entitled
"Use tax act,"
by amending section 14b (MCL 205.104b), as amended by 2015 PA 252.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 14b. (1) If an exemption from the tax under this act is
claimed, the seller shall obtain identifying information of the
purchaser and the reason for claiming the exemption at the time of
the purchase or at a later date. The seller shall obtain the same
information for a claimed exemption regardless of the medium in
which the transaction occurred.
(2) A seller shall use a standard format for claiming an
exemption electronically as adopted by the governing board under
the streamlined sales and use tax agreement.
(3) A purchaser is not required to provide a signature to
claim an exemption under this act unless a paper exemption form is
used.
(4) A seller shall maintain a proper record of all exempt
transactions and shall provide them when requested by the
department.
(5) A seller who complies with the requirements of this
section is not liable for the tax under this act if a purchaser
improperly claims an exemption. A purchaser who improperly claims
an exemption is liable for the tax due under this act. This
subsection does not apply if a seller does any of the following:
(a) Fraudulently fails to collect the tax under this act.
(b) Solicits a purchaser to make an improper claim for
exemption.
(c) Accepts an exemption form when the purchaser claims an
entity-based exemption if both of the following occur:
(i) The subject of the transaction sought to be covered by the
exemption form is actually received by the purchaser at a location
operated by the seller.
(ii) The state in which the location operated by the seller is
located provides an exemption form that clearly and affirmatively
indicates that the claimed exemption is not available in that
state.
(6) A seller who obtains a fully completed exemption form or
captures the relevant data elements as outlined in this section
within 120 days after the date of sale is not liable for the tax
under this act.
(7) If the seller has not obtained an exemption form or all
relevant data elements, the seller may either prove that the
transaction was not subject to the tax under this act by other
means or obtain a fully completed exemption form from the
purchaser, by the later of the following:
(a) 120 days after a request by the department.
(b) The date an assessment becomes final.
(c) The denial of a claim for refund.
(d) In the instance of a credit audit, the issuance of an
audit determination letter or informal conference decision and
order of determination.
(e) The date of a final order of the court of claims or the
Michigan tax tribunal, as applicable, with respect to an
assessment, order, or decision of the department.
(8) The department may, in its discretion, allow a seller
additional time to comply with subsection (7).
(9) A seller is not liable for the tax under this act if the
seller obtains a blanket exemption form for a purchaser with which
the seller has a recurring business relationship. Renewals of
blanket exemption forms or updates of exemption form information or
data elements are not required if there is a recurring business
relationship between the seller and the purchaser. For purposes of
this section, a recurring business relationship exists when a
period of not more than 12 months elapses between sales
transactions.
(10) A purchaser that fails to claim an exemption at the time
of purchase by notifying the seller of the exemption and providing
a complete and proper claim of exemption may submit a claim for a
refund to the department for the tax related to that purchase if
all of the following conditions are met:
(a) The claim for a refund is made within 4 years of the date
of purchase.
(b) The purchaser submits to the department an accurate record
of the purchase, including, but not limited to, a paper,
electronic, or digital receipt, invoice, or purchase order related
to the sale, that includes the date of the purchase and the amount
of sales tax paid to the seller for which the purchaser is seeking
a refund under this subsection.
(c) The purchaser submits to the department a form signed by
the seller as prescribed by the department that contains
information required by the department to substantiate the refund
claim. The form shall contain a statement that the seller reported
and paid the tax on the sale for which the purchaser is seeking a
refund under this subsection and that the seller has not claimed,
and will not claim, a refund of that tax.
(d) The purchaser submits to the department a proper exemption
claim on a form as prescribed by the department under this
subsection.
(e) The purchaser shall submit to the department any
additional information that the department may require related to
the purchaser's claim for refund under this subsection.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.