A bill to amend 1937 PA 94, entitled “Use tax act,” (MCL 205.91 to 205.111) by adding sections 4kk and 20a.
House Bill No. 5809, introduced in 2024, aims to amend the 1937 Use Tax Act by adding sections 4kk and 20a to establish a tax exemption period specifically for back-to-school purchases. This tax holiday is scheduled annually from 12:01 a.m. on the third Saturday of August until 11:59 p.m. on the third Sunday of August. During this period, certain items are exempt from the use tax, including:
Clothing priced at $100 or less per item (excluding clothing accessories, sports equipment, protective equipment, and items for trade or business use). School supplies priced at $20 or less per item. Computers for noncommercial use priced at $1,000 or less. School computer supplies for noncommercial use priced at $500 or less.
The bill provides detailed definitions for eligible items, such as what constitutes "clothing," "school supplies," "computers," and "school computer supplies," ensuring clarity on what qualifies for the tax exemption. It also outlines specific conditions for layaway sales, handling of discounts and coupons, and the process for returns and exchanges during the tax holiday. Additionally, the bill mandates that the department must notify the public about the tax holiday at least 60 days in advance, ensuring adequate preparation time for both consumers and retailers. The seller's time zone is used to determine the exact period of the tax holiday, and orders placed during the exemption period for immediate shipment are eligible for the exemption, even if delivered later.
Co-sponsored by Reps.
Referred to the Committee on Tax Policy
