Introduced
by
To exempt from sales tax the value of a trade-in on the purchase of a new vehicle or titled watercraft. The buyer would only pay sales tax on the difference between the value of the trade-in and the purchase price of the new item. This would eventually save new car buyers (and/or dealers) some $220 million annually when it is fully phased-in after four years. The bill does not specify what spending items would be cut or other taxes increased to make up this reduction.
Referred to the Committee on Tax Policy
Reported without amendment
With the recommendation that the substitute (H-1) be adopted and that the bill then pass.
Substitute offered
The substitute passed by voice vote
Amendment offered
by
To transfer money from the state general fund to the state school aid fund to make up foregone revenue in the latter caused by the proposed sales tax change.
The amendment failed by voice vote
Passed in the House 100 to 7 (details)
To exempt from sales tax the value of a trade-in on the purchase of a new vehicle, recreational vehicle or titled watercraft. The buyer would only pay sales tax on the difference between the value of the trade-in and the purchase price of the new item. This vehicle part of this would eventually save new car buyers (and/or dealers) some $220 million annually when fully phased-in after six years. The bill does not specify what spending items would be cut or other taxes raised to make up this foregone revenue.
Referred to the Committee on Finance
Substitute offered
To adopt a version of the bill that phases in the tax break over 24 years.
The substitute passed by voice vote
Amendment offered
by
To use general tax revenue to reimburse the amount that the tax break reduces sales tax revenue otherwise earmarked to the school aid fund.
The amendment failed by voice vote
Passed in the Senate 38 to 0 (details)
To exempt from sales tax the value of a trade-in when buying a new motor vehicle or recreational vehicle. Senate Bill 89 would phase this tax break in over 24 years, and halt the phase-in if the federal health care law's Medicaid expansion (authorized by <a href="http://www.michiganvotes.org/2013-HB-395">House Bill 4714</a>) is rescinded. (Note: Legal experts are divided over whether the state would be allowed to rescind the "Obamacare" Medicaid expansion.) Under these two bills, the buyer would only pay sales tax on the difference between the value of the trade-in and the purchase price of the new car. Initially, the tax break would only apply to $2,000 of the price difference, and this would increase $500 per year. When fully implemented the tax break's value would reach $226 million (in 2013 dollars).
Passed in the House 101 to 7 (details)
