LANSING ? Michigan Legislation requiring online retailers with a presence in Michigan to collect the 6 percent sales tax is getting a new boost from Governor Rick Snyder, who in the past has said the first action on the issue should come from the federal government.
Bills pending on the House floor since September (HB 4202 and HB 4203 ) and in a Senate committee (SB 658 and SB 659 ) primarily seek to force retailers like Amazon, which do not collect the sales tax, to do so. The change would make it so that any business making a sale to someone in Michigan had enough of a nexus to warrant collection of the tax instead of the current requirement for a physical presence.
Local retailers have put a huge emphasis for years on the change, saying online retailers can claim a 6 percent price advantage through not charging for the sales tax.
Snyder, while favoring the change, has previously said it would make more sense to have Congress pass legislation first. So far a bill has passed the U.S. Senate, but it is unclear whether the U.S. House will act on it.
Tuesday, new Treasurer Kevin Clinton signaled a change in stance from the Snyder administration when he told a House subcommittee he saw the issue as one “to look at” in 2014.
Wednesday, Snyder cited some recent legal rulings for leading to his view now that the state need not wait for the federal government to act.
In remarks to the Michigan Society of Association Executives, Snyder, asked if he considered the issue one to focus on in 2014, said he thought the issue was fair for discussion.
The legal ruling Snyder had in mind was the U.S. Supreme Court’s decision not to grant leave to appeal in a New York case where Amazon and Overstock.com challenged a state law extending the state’s sales and use taxes to remote sellers without a physical presence in the state. New York state courts upheld the law, and the U.S. Supreme Court declined to hear the appeal.
“If you go back two or three years it was very much waiting for the federal government to act,” Snyder said of his previous stance. “Since then, there have been some other case developments in terms of legal opinions that I think it makes it more interesting to say the state could also separately look at this issue. Long term we still need a federal resolution, but I think there’s more merit to the state actually having a good dialogue about the topic now than there was a year or two ago.”
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