Buying Online? State Will Get Its Cut Beginning Oct. 1

One of the advantages of buying online is going away. After September 30th, Michigan will be collecting sales tax from online purchases from out of state retailers. Since the beginning of internet commerce, it's been a sort of honor system; shoppers  expected to keep track and self-report uncollected taxes for purchases made from out of state online retailers.

The Michigan Treasury Department says "today’s announcement allows for the more efficient collection of the sales tax by collecting from businesses rather than individuals.

In June, the U.S. Supreme Court overturned a more than 30-year precedent in South Dakota v. Wayfair, allowing the Michigan Department of Treasury to collect sales tax from retailers physically located outside the state if the retailer exceeds $100,000 in sales or 200 or more transactions in Michigan within the previous calendar year.  - Michigan Dept. of Treasury

The Treasury Department’s new administrative requirement is that "all applicable mail order and online retailers physically located outside of Michigan must pay state sales tax and file tax returns for taxable sales made after Sept. 30, 2018."

It will be interesting to see the after effect of this. Will this result in higher prices for online purchases, and thus make buying local a little more enticing? It remains to be seen.

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