Michigan reminds online shoppers to pay state sales tax
The state of Michigan wants online shoppers to save their sales receipts.
They may need them at tax time.
The growth of online sales has meant a bigger loss of sales tax revenue in Michigan.
The state expects to lose $440 million in unpaid sales tax on remote sales, mainly online.
“Oftentimes people think that this is a new tax. It certainly isn’t,” says Treasury Department spokesman Terry Stanton. “It’s been on the state’s books since 1930s.”
The use tax was created to collect sales taxes on catalog and telephone sales. But in the past decade, online sales have become extremely important.
However, relatively few Michigan taxpayers take the time to take note of their sales taxes on online purchases on their state income tax forms.
Stanton says out of more than three million state income tax returns filed last year, only 112,000 acknowledged owing a state “use tax."
A Michigan State University professor says about 12% of all retail sales are made online.