Tribal members and tribal entities shall be subject to and shall
comply with the following duties and obligations with respect to sales
and use taxes:
A.
Use state forms to claim non-T-STA exemptions. To obtain the benefit of statutory sales and use tax exemptions other than those specifically provided by the Tribal-State Tax Agreement, a tribal member or tribal entity shall use the standard procedures and forms used by all taxpayers claiming exemption. See Revenue Administrative Bulletin 2002-15. [§ 10.1-13A(2); T-STA § XII.A.2]
B.
Use of tribal certificate of exemption for qualified purchaser if
authorized by Tribe.
(1)
If the Tribe elects to authorize resident tribal members and
tribal entities to use a tribal certificate of exemption for RTM vehicle
purchases, RTM modular and mobile home purchases, TT&L construction
contractor purchases, and RTM personal residence contractor purchases,
and for purchase of materials for self-performed construction, renovation
or improvement of real property in the tribal and trust lands ("TT&L
do-it-yourself purchases"), or for a principal residence of a resident
tribal member ("RTM do-it-yourself purchases"), resident tribal members
and tribal entities shall for each such purchase:
(a)
Use a tribal certificate of exemption for such purchases and
not seek a refund of any sales tax paid;
(b)
Submit to the Tribe a signed resident tribal member/tribal entity
claim containing all required information to obtain a certificate;
and
(c)
Present the certificate (together with the letter of authorization)
to the vendor or contractor at the point of purchase.
(2)
Notwithstanding tribal authorization of resident tribal members and tribal entities to use a tribal certificate of exemption, resident tribal members and tribal entities may only obtain the benefit of the TT&L purchase exemption under § 10.2-3A(1) of this chapter, other than for a TT&L do-it-yourself purchase, by filing a resident tribal member/tribal entity sales tax and use tax refund request form with the state. [§ 10.1-13C(1); T-STA § XII.C.1]
C.
Use refund method if Tribe does not authorize use of tribal certificate of exemption. If the Tribe does not authorize its resident tribal members and tribal entities to use tribal certificates of exemption, resident tribal members and tribal entities shall pay sales tax on all RTM vehicle purchases, RTM modular and mobile home purchases, TT&L construction contractor purchase, RTM personal residence construction contractor purchases, TT&L do-it-yourself purchases and RTM do-it-yourself purchases and file a resident tribal member/tribal entity sales tax and use tax refund request, with any information and backup documentation required by the instructions to the form, to apply for refund of the tax. Resident tribal member/tribal entity sales tax and use tax refund request forms may be filed with the state in April, July, October, and January. [§ 10.1-13C(2); T-STA § XII.C.2]
D.
Refund table claim for miscellaneous RTM personal purchases. In order to claim an annual refund representing sale tax and use tax paid on miscellaneous RTM personal purchases, other than RTM do-it-yourself purchases, the resident tribal member must submit a refund table claim on such form as the state shall prescribe. [§ 10.1-13C(3); T-STA § XII.C.3]
E.
Recordkeeping for TTL purchases. Resident tribal members and tribal entities shall maintain records for items that are claimed exempt on the basis that the purchase occurred in, and the use is exclusively in, tribal and trust lands. [§ 10.1-13E(1); T-STA § XII.E.1]
F.
Collect state tax when acting as retailers. Tribal member and tribal entity retailers shall collect and remit state sales tax or use tax on all sales to nontribal members, and any sale to the Tribe, tribal members or tribal entities that are not exempt under the Tribal-State Tax Agreement, in accordance with state procedures generally applicable to retail sellers. [§§ 10.1-3B and 10.1-13D; T-STA § III.B and XII.D]
G.
Retailer records for exempt sales. Tribal member and tribal entity retailers shall maintain records regarding sales that are not taxable under the Tribal-State Agreement. With respect to sales within the Agreement Area to the Tribe, tribal members and tribal entities on which no tax was collected, retailers shall maintain a record including the date, the name and tribal identification number of the purchaser, the amount, and for any item of more than $50 or sales of more than $200 in the aggregate, the identification of the items purchased and any other data sufficient to document the exemption. [§ 10.1-13E(1); T-STA § XII.E.1]
If the Tribe elects to allow resident tribal members and tribal
entities to use tribal certificates of exemption for qualified purchases,
the user of the certificate shall be solely responsible for assuring
that the purchase transaction for which it is used is qualified for
the exemption claimed pursuant to the Tribal-State Tax Agreement.
If notified by the state that their use of a tribal certificate of
exemption is alleged to be improper or ineffective and the state claims
that tax is due, the tribal member or entity shall promptly pay the
assessment or diligently contest it through available means provided
by state law and the Tribal-State Tax Agreement, and shall save and
hold the Tribe harmless from such assessment. If the Tribe is assessed
any amount of tax or interest on any purchase of the tribal member
or tribal entity upon disallowance of an exemption claimed by tribal
certificate of exemption, the tribal member or tribal entity shall
reimburse the Tribe on demand. The Tribe shall be entitled to recover
the entire amount assessed and all costs of collection, including
attorneys' fees. The Tribe may recover amounts owed to it hereunder
by offset against any amounts owed by the Tribe to the tribal member
or entity, including any per capita payment, and through suit in the
Tribal Court or any other forum.
Tribal members and tribal entities shall have the following
duties and obligations with respect to personal income tax:
A.
Employee withholding. Tribal member and tribal entity employers will withhold and remit to the state income tax from all employees in accordance with regulations/instructions generally applicable, except that withholding is not required on resident tribal members. [§§ 10.1-4C(1) and 10.1-10B; T-STA § IV.E.I. and IX.B]
B.
File return. All resident tribal members shall file a state tax return
(i) if they owe a Michigan income tax, (ii) are due a refund, (iii)
their federal adjusted gross income exceeds their exemption allowance,
or (iv) they are required to file a federal return (in order to eliminate
unnecessary correspondence with the Department). A taxpayer who is
entitled to exemption based on the Tribal-State Tax Agreement shall
complete a schedule in accordance with state instructions to claim
the exemption. [T-STA]
A taxpayer claiming entitlement to exemptions from the single business tax provided in the Tribal-State Tax Agreement shall prepare and file the SBT annual return form C-8000 in accordance with special instructions for a taxpayer claiming exemptions under the Tribal-State Tax Agreement. [§ 10.1-10C; T-STA § IX.C]
Tribal member and tribal entity retailers shall have the following
duties and obligations with respect to motor fuels tax:
A.
Quota system compliance by retailers. If the Tribe elects to use the quota system, (i) tribal member and tribal entity retailers shall comply with the system established by the Tribe for preapproval of all purchases of tax-free fuel, and (ii) in addition to maintaining the books and records required by state law, all retailers authorized by the Tribe to purchase tax-free fuel shall maintain a log of their tax-free purchases showing the delivery date, type (gasoline or diesel) and quantity of fuel purchased. [§ 10.1-11A; T-STA § X.A]
B.
Fuel purchases by retailers under refund system. If the Tribe elects to use the refund system, each tribal member and tribal entity retailer shall purchase all motor fuel for resale in accordance with state law from any state-licensed wholesaler, tax prepaid, and taxable sales will include tax in the price. [§ 10.1-5B(2); T-STA § V.B.2]
C.
Refund system compliance by retailers. If the Tribe elects to use the refund system, each tribal member and tribal entity retailer authorized by the Tribe to receive refunds shall submit their claims to the Tribe which will compile them as a single request to be filed with the state on a monthly or quarterly basis. The state shall issue a single refund check to the Tribe, and the Tribe shall allocate the refund among retailers. In addition to maintaining the books and records required by state law, all authorized retailers shall maintain a log of their sales of tax-free motor fuel showing the date, the purchaser's name, the purchaser's tribal identification number, the purchaser's signature (or approved swipe card record), and the amount and type (gasoline or diesel) of fuel purchased. [§ 10.1-11B; T-STA § X.B]
Tribal members and tribal entity retailers shall have the following
duties and obligations with respect to tobacco products tax:
A.
Quota system compliance by retailers. If the Tribe elects to use the quota system, tribal member and tribal entity retailers shall comply with the system established by the Tribe for preapproval of all purchases of tax-free product. In addition to maintaining the books and records required by state law, all authorized retailers shall maintain a log of their purchases of tax-free quota tobacco products showing the date, type (cigarettes, cigar, chew, etc.), quantity, and brand. [§ 10.1-12A; T-STA § XI.A]
B.
Tobacco products purchases of retailers under refund system. If the Tribe elects to use the refund system, each tribal member and tribal entity retailer shall purchase all tobacco products for resale in accordance with state law from any state-licensed wholesaler, tax prepaid, and taxable sales will include tax in the prices. [§ 10.1-6B(1); T-STA § VI.B.1]
C.
Refund system compliance by retailers. If the Tribe elects to use the refund system, each tribal member or tribal entity retailer authorized by the Tribe to receive refunds shall submit their claims to the Tribe which will compile them as a single request to be filed with the state on a monthly or quarterly basis. The state will then issue a single refund check to the Tribe, and the Tribe shall allocate the refund among retailers. In addition to maintaining the books and records required by state law, all authorized retailers shall maintain a log of their sales of tax-free tobacco products showing the date, type, quantity, and brand of product sold with the name, tribal identification number, and signature of the purchaser (or approved swipe card record). [§ 10.1-12B; T-STA § XI.B]
With respect to covered taxes generally, tribal members and
tribal entities shall:
A.
Maintain records for exemption claims. Consistent with state law, maintain records (including retention of original receipts other than those for purchases claimed on the sales tax table return) sufficient to substantiate claims for exemption from covered taxes under the Tribal-State Tax Agreement, and copies of any tribal exemption certificates used; [§§ 10.1-9A and 10.1-13E(3); T-STA §§ VIII.A and XII.E.3]
B.
Audit cooperation. Cooperate with audits by the state with respect to covered taxes; and [§ 10.1-14D(2); T-STA § XIII.D.2]
