Michigan Laws 205.103a – Sales of advertising and promotional direct mail; sales of other direct mail; direct payment authorization or exemption form provided by purchaser; limitation; definitions
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Terms Used In Michigan Laws 205.103a
- Business: means all activities engaged in by a person or caused to be engaged in by a person with the object of gain, benefit, or advantage, either direct or indirect. See Michigan Laws 205.92
- Department: means the department of treasury. See Michigan Laws 205.92
- Direct mail: means printed material delivered or distributed by United States mail or other delivery service to a mass audience or to addresses on a mailing list provided by the purchaser or at the direction of the purchaser if the cost of the items is not billed directly to the recipients, including tangible personal property supplied directly or indirectly by the purchaser to the direct mail seller for inclusion in the package containing the printed material but not including multiple items of printed material delivered to a single address. See Michigan Laws 205.92b
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Person: means an individual, firm, partnership, joint venture, association, social club, fraternal organization, municipal or private corporation whether or not organized for profit, company, limited liability company, estate, trust, receiver, trustee, syndicate, the United States, this state, county, or any other group or combination acting as a unit, and the plural as well as the singular number, unless the intention to give a more limited meaning is disclosed by the context. See Michigan Laws 205.92
- Sale: means a transaction by which tangible personal property or services are purchased or rented for storage, use, or other consumption in this state. See Michigan Laws 205.92
- Seller: means the person from whom a purchase is made and includes every person selling tangible personal property or services for storage, use, or other consumption in this state. See Michigan Laws 205.92
- state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
- Tax: includes all taxes, interest, or penalties levied under this act. See Michigan Laws 205.92
- Use: means the exercise of a right or power over tangible personal property incident to the ownership of that property including transfer of the property in a transaction where possession is given. See Michigan Laws 205.92
(1) For sales of advertising and promotional direct mail all of the following apply:
(a) If the purchaser provides the seller with a direct payment authorization issued under section 8 or an exemption form as prescribed by the department for claiming direct mail, the seller, in the absence of bad faith, is relieved of all obligation to collect, pay, or remit any applicable tax under this act on any transaction involving advertising and promotional direct mail to which the direct payment authorization or exemption form applies and the purchaser shall source the sale to the jurisdictions to which the advertising and promotional direct mail is to be delivered to the recipients and shall report and pay any applicable tax due.
(b) If the purchaser provides the seller with information indicating the jurisdictions to which the advertising and promotional direct mail is to be delivered to recipients, the seller shall source the sale to the jurisdictions to which the advertising and promotional direct mail is to be delivered and shall collect and remit the applicable tax due. In the absence of bad faith, the seller is relieved of any further obligation to collect any additional tax on the sale of advertising and promotional direct mail if the seller sourced the sale and collected the tax in accordance with the delivery information provided by the purchaser.
(c) If the purchaser does not provide the seller with a direct payment authorization, an exemption form prescribed by the department, or any information indicating the jurisdictions to which the advertising and promotional direct mail is to be delivered, the sale shall be sourced in accordance with section 20(1)(e).
(2) Except as otherwise provided under this subsection, sales of other direct mail shall be sourced in accordance with section 20(1)(c). If the purchaser provides the seller with a direct payment authorization issued under section 8 or an exemption form as prescribed by the department for claiming direct mail, the seller, in the absence of bad faith, is relieved of all obligation to collect, pay, or remit any applicable tax under this act on any transaction involving other direct mail to which the direct payment authorization or exemption form applies and the sale shall be sourced to the jurisdictions to which the other direct mail is to be delivered to the recipients and the purchaser shall report and pay any applicable tax due.
(3) This section only applies to a transaction characterized as a sale of services if the service is an integral part of the production and distribution of direct mail.
(4) This section does not apply to any transaction that includes the development of billing information or the provision of any data processing service that is more than incidental, regardless of whether advertising and promotional direct mail is included in the same mailing.
(5) If a transaction is a single transaction that includes a component in addition to advertising and promotional direct mail, this section only applies if the primary purpose of the transaction is to attract public attention or to sell, popularize, or secure financial support for the sale of the product or service.
(6) Nothing in this section limits a purchaser’s obligation for sales or use tax due to any state to which the direct mail is delivered or limits a purchaser’s right under any other law for a credit or refund of sales or use taxes paid to any other jurisdiction.
(7) As used in this section:
(a) “Advertising and promotional direct mail” means direct mail the primary purpose of which is to attract public attention to a product, service, person, business, or organization, or to attempt to sell, popularize, or secure financial support for a product, service, person, business, or organization.
(b) “Other direct mail” means any direct mail that is not advertising and promotional direct mail regardless of whether advertising and promotional direct mail is included in the same mailing. Other direct mail includes, but is not limited to, any of the following:
(i) Transactional direct mail that contains personal information specific to the addressee such as invoices, bills, statements of account, and payroll advices.
(ii) Any legally required mailings such as privacy notices, tax reports, and stockholder reports.
(iii) Any other nonpromotional direct mail delivered to existing or former shareholders, customers, employees, or agents such as newsletters and informational pieces.