Governor Signs Ananich Main Street Fairness Bills into Law

Legislation levels economic playing field, secures much-needed road funding

LANSING–Senate Minority Leader Jim Ananich (D-Flint) joined Governor Rick Snyder and Michigan small business owners today for the ceremonial signing of Senate Bills 658 and 659 of 2013, the Main Street Fairness bills. These bills, sponsored by Ananich, will promote economic fairness and help Michigan businesses compete on a level playing field with large internet retailers. The legislation is also a key piece of the bipartisan compromise on road funding reached last month.

“These bipartisan bills are about helping Michigan businesses, which in turn helps our local economies and supports job creation,” said Senator Ananich. “These laws already exist, but have been going unenforced, putting local business owners at a disadvantage and squandering millions in vital state revenue that can support other priorities like road repairs and school funding.”

When consumers buy a product online, Michigan law says they must pay the same sales tax they would if they were to buy the product from a store in person. Under Michigan’s current sales tax collection system, out-of-state, online-only retailers are exploiting the massive legal loophole, allowing them to forgo collecting sales tax at the point of sale. Online-only retailers use this loophole to attract shoppers away from brick-and-mortar businesses by using deceptively lower prices, since Michigan retailers must add—and collect—the 6-percent sales tax to the customer’s bill. As a result, Main Street businesses are put at a significant competitive disadvantage that puts Michigan’s business community at risk.

To close the sales tax loophole the Michigan Main Street Fairness Act:

“By holding internet retailers to the same standards as physical businesses in Michigan, we are simultaneously shedding light on e-commerce practices and encouraging people to shop locally,” Ananich said. “I appreciate the support of Michigan workers, businesses and elected officials to work together to get this passed.”

Today, the owners of Michigan businesses Marshall Music, Becky Beauchine Kulka Diamonds and Fine Jewelry and Great Northern Trading Company joined Governor Snyder and Senator Ananich for the signing of his Main Street Fairness bills. When the Main Street Fairness bills were first introduced in 2013, retailers from across Michigan formed the Michigan Alliance for Main Street Fairness, a coalition of hundreds of job-makers calling for common-sense updates to Michigan’s tax system like this.

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