Mich. Admin. Code R. 205.62 - Aircraft

Rule 12.

(1) Except for exempt sales under section 4 x of the General Sales Tax Act, 1933 PA 167, MCL 205.54x, and sales to a purchaser that has made a valid lessor election under section 5(4) of the Use Tax Act, 1937 PA 94, MCL 205.95, sales of new and used aircraft are subject to sales tax on the full selling price without deductions for expenses incurred as part of the cost of doing business or trade-in credit given to a purchaser. To make a valid election under section 5(4) of the Use Tax Act, 1937 PA 94, MCL 204.95, a lessor of an aircraft must register for use tax by the earlier of the date set for the first payment of use tax under the lease or rental agreement or 90 days after the lessor first brings the aircraft into this state.

(2) Unless exempt under section 4 x of the General Sales Tax Act, 1933 PA 167, MCL 205.54x, gasoline, jet fuel, oil, repair parts, and other tangible personal property sold and delivered in this state for operation of aircraft are subject to sales tax regardless of where the plane will be flown or used.

(3) A seller in the ordinary course of business, including an aircraft dealer engaged in the purchasing, selling, brokering, exchanging, or dealing in aircraft parts or in aircraft of a type required to be registered under the Aeronautics code of the state of Michigan, 1945 PA 327, MCL 259.1 to 259.208, shall remit sales tax on the full sales price of an aircraft, regardless of whether the sales are on its own behalf or on behalf of the aircraft owner.

(4) Aircraft purchased for consumption or use in this state from sellers outside this state are subject to use tax.

(5) A dealer, as that term is defined in section 3 of the Aeronautics code of the state of Michigan, 1945 PA 327, MCL 259.3, that uses the property solely for demonstration and for which no charge is made while holding it for sale is exempt from tax on account of such use.

(6) When an aircraft used for demonstration is converted to a taxable use, such as for personal use, use tax is owed on the dealer's original purchase price, if the aircraft was converted to a purpose other than selling, brokering, exchanging, or dealing in aircraft parts or in sales of aircraft.

(7) Sales tax applies to the retail sale of the aircraft following its use for demonstration without deduction for use tax previously paid under subrule (6) of this rule.

(8) A specific tax under the streamlined sales and use tax revenue equalization act, 2004 PA 175, MCL 205.171 to 205.191, of 6% is owed, less an amount equal to the use tax paid, on the retail value of a qualified aircraft for the privilege of storing, registering, or transferring ownership in this state, unless exempt from sales or use tax, including for purposes of resale. The retail value is determined at the time the aircraft first enters this state and is to be based on an industry accepted pricing guide applicable to the aircraft. It is solely within the department of treasury's discretion to determine if a pricing guide is industry accepted. As used in this subrule, "qualified aircraft" means an aircraft purchased outside of this state, used solely for personal, non-business purposes, and either brought into this state more than 90 days after the date of purchase by a nonresident or brought into this state more than 360 days after the date of purchase by a resident.

Notes

Mich. Admin. Code R. 205.62

1979 AC; 2023 MR 15, Eff. 8/11/2023