Bill Text: MI SB1100 | 2013-2014 | 97th Legislature | Engrossed
Bill Title: Sales tax; other; requirement for use of certain anti-sales suppression devices for certain entities; provide for. Amends sec. 18 of 1933 PA 167 (MCL 205.68).
Spectrum: Partisan Bill (Republican 5-0)
Status: (Engrossed - Dead) 2014-12-02 - Referred To Committee On Tax Policy [SB1100 Detail]
Download: Michigan-2013-SB1100-Engrossed.html
SB-1100, As Passed Senate, November 13, 2014
SUBSTITUTE FOR
SENATE BILL NO. 1100
A bill to amend 1933 PA 167, entitled
"General sales tax act,"
by amending section 18 (MCL 205.68), as amended by 2014 PA 108.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 18. (1) A person liable for any tax imposed under this
act shall keep in a paper, electronic, or digital format an
accurate and complete beginning and annual inventory and purchase
records of additions to inventory, complete daily sales records,
receipts, invoices, bills of lading, and all pertinent documents in
a form the department requires. A person shall not destroy or alter
electronic records required to be maintained under this act or
under 1941 PA 122, MCL 205.1 to MCL 205.31. If an exemption from
the tax under this act is claimed by a person because the sale is
for resale at retail, a record shall be kept of the sales tax
license number if the person has a sales tax license. These records
shall be retained for a period of 4 years after the tax imposed
under this act to which the records apply is due or as otherwise
provided by law.
(2) Beginning January 1, 2015 through December 31, 2017, the
department may require not more than 1,000 persons subject to the
tax under this act to maintain an anti-sales suppression device on
its cash register, electronic cash register, or any other point-of-
sale system in a manner prescribed by the department.
(3) (2)
If the department considers it
necessary, the
department may require a person, by notice served upon that person,
to make a return, render under oath certain statements, or keep
certain records the department considers sufficient to show whether
or not that person is liable for the tax under this act.
(4) (3)
A person knowingly making a sale of
tangible personal
property for the purpose of resale at retail to another person not
licensed under this act is liable for the tax under this act unless
the
transaction is exempt under the provisions of section 4k.
(5) (4)
If the taxpayer fails to file a
return or to maintain
or preserve sufficient records as prescribed in this section, or
the department has reason to believe that any records maintained or
returns filed are inaccurate or incomplete and that additional
taxes are due, the department may assess the amount of the tax due
from the taxpayer based on an indirect audit procedure or any other
information that is available or that may become available to the
department. That assessment is considered prima facie correct for
the purpose of this act and the burden of proof of refuting the
assessment is upon the taxpayer. An indirect audit of a taxpayer
under this subsection shall be conducted in accordance with 1941 PA
122, MCL 205.1 to 205.31, and the standards published by the
department under section 21 of 1941 PA 122, MCL 205.21, and shall
include all of the following elements:
(a) A review of the taxpayer's books and records. The
department may use an indirect method to test the accuracy of the
taxpayer's books and records.
(b) Both the credibility of the evidence and the
reasonableness of the conclusion shall be evaluated before any
determination of tax liability is made.
(c) The department may use any method to reconstruct income,
deductions, or expenses that is reasonable under the circumstances.
The department may use third-party records in the reconstruction.
(d) The department shall investigate all reasonable evidence
presented by the taxpayer refuting the computation.
(6) (5)
If a taxpayer has filed all the
required returns and
has maintained and preserved sufficient records as required under
this section, the department shall not base a tax deficiency
determination or assessment on any indirect audit procedure unless
the department has a documented reason to believe that any records
maintained or returns filed are inaccurate or incomplete and that
additional taxes are due.
(7) (6)
If all the information is maintained
as provided under
section 12, an exemption certificate is not required for an
exemption claim by the following:
(a) A person licensed by the Michigan liquor control
commission as a wholesaler for purposes of sales of alcoholic
liquor to another person licensed by the Michigan liquor control
commission. As used in this subsection, "alcoholic liquor",
"authorized distribution agent", and "wholesaler" mean those terms
as defined in the Michigan liquor control code of 1998, 1998 PA 58,
MCL 436.1101 to 436.2303.
(b) The Michigan liquor control commission or a person
certified by the commission as an authorized distribution agent for
purposes of the sale and distribution of alcoholic liquor to a
person licensed by the Michigan liquor control commission.
(8) (7)
For purposes of this act, a blanket
exemption claim
covers all exempt transfers between the taxpayer and the buyer for
a period of 4 years or for a period of less than 4 years as stated
on the blanket exemption claim if that period is agreed to by the
buyer and taxpayer. Renewal of a blanket exemption claim or an
update of exemption claim information or data elements is not
required if there is a recurring business relationship between the
seller and the purchaser. For purposes of this subsection, a
recurring business relationship exists when a period of not more
than 12 months elapses between sales transactions.
(9) (8)
As used in this section:
(a) "Anti-sales suppression device" means a tangible device,
software program, or any other means used to prevent or detect the
use of an automated sales suppression device or zapper, phantom-
ware, or a skimming device as those terms are defined in section
411w of the Michigan penal code, 1931 PA 328, MCL 750.411w.
(b) (a)
"Indirect audit
procedure" is an audit method that
involves the determination of tax liabilities through an analysis
of a taxpayer's business activities using information from a range
of sources beyond the taxpayer's declaration and formal books and
records.
(c) (b)
"Sufficient records"
means records that meet the
department's need to determine the tax due under this act.
