Sales and Use Taxes
Sales Tax
Because the University sells tangible personal property to final consumers, it is required to remit a 6% sales tax on taxable retail sales. The tax is paid to the State of Michigan since state law prohibits city or local units from imposing sales or use taxes.
Use Tax
State law requires the collection of a 6% use tax when property is rented to non-exempt entities and sales tax was not paid at the time of acquisition. Renters and lessors who did not pay sales tax on property at the time of acquisition must collect and report use tax on rental receipts received from individuals or organizations not otherwise exempt from tax. In these instances, departments must collect and report use tax on rental receipts each time property is rented or leased to non-exempt entities.