Michigan: Sales Tax Handbook

Michigan Sales Tax Rate

2024 Michigan Sales Tax Handbook

Michigan Table of Contents

• List of Local Sales Tax Rates
• Sales Tax Calculator
• Sales Tax Exemption Certificates
• Sales Tax Info For Businessowners
  • Getting A Sales Tax Permit
  • Filing Your Sales Tax Return
  • Sales Tax Return Filing Schedule
  • What Defines Sales Tax Nexus?
  • Appealing Sales Tax Audits
• Taxable vs. Non-Taxable Purchases
  • What Sales Are Taxable?
  • Sales Tax Exemptions
  • Sales Tax Basis Components
  • Alcohol Excise Taxes
  • Tobacco Excise Taxes
  • Gasoline & Fuel Excise Taxes
  • Marijuana Taxes
• Sales Tax on Cars & Vehicles
• More Information
  • State Sales Tax Map
  • State Sales Tax Rate Table
  • Recent Tax Rate Changes
  • List of Sales Tax Holidays
  • Contact the Department of Revenue

These rankings show how the Michigan sales tax compares to the other 49 states + DC. The state with the highest sales tax is ranked 1st, and states with the same sales tax have a tie rank.

Michigan's Sales Tax By The Numbers:

Michigan has a higher-than-average state sales tax rate, but the actual sales tax rates in most Michigan cities are lower than average when local sales taxes from Michigan's 175 local tax jurisdictions are taken into account.

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Rankings by Average State + Local Sales Tax:

  Ranked 36th highest by combined state + local sales tax

  Ranked 27th highest by per capita revenue from state + local sales taxes ($904 per capita)

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Rankings by State Sales Tax Only:

  Ranked 8th highest by state sales tax rate

  Ranked 21st highest by per capita revenue from the statewide sales tax ($852 per capita)

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MI City & County Taxes

MI Sales Tax Calculator

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Printable PDF Michigan Sales Tax Datasheet

What is exempt from sales taxes in Michigan?

Many states have special sales tax rates that apply to the purchase of certain types of goods, or fully exempt them from the sales tax altogether. Here's how Michigan taxes five types of commonly-exempted goods:

Clothing

  6%

Groceries

  EXEMPT

Prepared Food

  6%

Prescription Drugs

  EXEMPT

OTC Drugs

  6%

For more details on what types of goods are specifically exempt from the Michigan sales tax see Michigan sales tax exemptions. To learn more about what types of transactions are subject to the sales tax to begin with, see what purchases are taxable in Michigan? Taxation of vehicle purchases in particular are discussed in the page about Michigan's sales tax on cars.

Are services subject to sales tax in Michigan?

"Goods" refers to the sale of tangible personal property, which are generally taxable. "Services" refers to the sale of labor or a non-tangible benefit. In Michigan, specified services are taxable.

About the Michigan Sales Tax

The state of Michigan has relatively simple sales tax rate, and is one of the few states which does not have any local city or county taxes. The sales tax hasn't been changed since 1994, with a ballot measure to raise the tax to 7% failing in 2015.

There is also a use tax which is applicable to items which were brought into Michigan but were not purchased there.

It is worth noting that Michigan is considered to be a Streamlined Sales Tax State, which means that any out-of-state businesses who do not have any sales tax obligation per se, would nevertheless be encouraged to collect and remit sales tax."

Is the Michigan Sales Tax Destination-Based or Origin-Based?

Michigan is a destination-based sales tax state, which means that sales tax rates are determined by the location of the buyer when the transaction is completed. This means that, for orders placed via the internet/mail by a customer within Michigan from a Michigan vendor, the vendor must collect a sales tax rate applicable at the buyer's address (including any applicable local sales taxes). This can significantly increase the complication of filing your sales tax return, because different sales tax rates must be charged to different buyers based on their location.

Is Michigan a Streamlined Sales Tax State?

Michigan is a member of the Streamlined Sales and Use Tax Agreement, which means that the Michigan Department of Treasury has taken significant steps to simplify Michigan's sales tax rules and administration process.

Contact the Michigan Department of Treasury

The Michigan Sales Tax is administered by the Michigan Department of Treasury. You can learn more by visiting the sales tax information website at www.michigan.gov.

Phone numbers for the Sales Tax division of the Department of Treasury are as follows:

• Local Phone: (517) 636-6925

Learn More: Our Book Recommendations

If you would like to learn more about how to manage your Michigan sales taxes, we recommend the following books:

Small Business Taxes For Dummies

This introductury book assists both current and aspiring small business owners with important tax planning issues, and covers a wide variety of small business tax topics.

Buy on Amazon

A Guide to Sales and Use Tax

This book provides information and insights on how to comply with a multitude of sales and use tax laws and regulations. This is our recommendation if you need an in-depth look into sales taxes.

Buy on Amazon