Michigan Sales Tax Arrives Online

Internet-sales-tax TYPISTBy: Deb Havens

If you’re a heavy-duty online shopper, you’ve already discovered that as of October 1, you’re paying a Michigan sales tax when you check out.

The end of a tax-free zone on the Internet has raised a howl of protest from some who charge that the state is imposing yet another new tax. That’s just not so, says Wyoming-Kentwood Chamber of Commerce President, Bob O’Callaghan, “Some people are against any kind of taxes, but this is not new. It’s always been a law, it just hasn’t been enforced because there was no good way to track it.”

The original legislation required Michigan residents to keep records of their online purchases and make a tax payment to the state. “But of course no one did,” notes O’Callaghan.  So like many other states, Michigan now requires online companies to collect and forward the sales tax.

Internet-sales-tax AMAZONMichigan Governor Rick Snyder estimates that somewhere around $60 million in new revenue will be added to the state’s treasury.

While O’Callaghan says there is no way to predict how much of that amount will find its way into the Wyoming-Kentwood community, he is an enthusiastic cheerleader for brick and mortar businesses here that must charge sales tax. “I think it’s a great idea,” he says. “Businesses here have the same products, so all things being equal, we want people to shop here because it keeps our tax dollars supporting our community services.” O’Callaghan points out that local taxes are key to essential public services such as police and fire protection, adding that local businesses also provide jobs for residents.

O’Callaghan says people forget that many online businesses are owned or operated outside the state of Michigan or even internationally. That means dollars spent online usually end up far from home, a fact that does not strike Bob O’Callaghan as fair to Michigan business or to other residents. “People who live here and shop here pay taxes here. It’s only fair that if you live here, you pay the same tax if you shop online.”