STATE NAME: MICHIGAN Streamlined Sales Tax Governing Board Section 328 Taxability Matrix Effective Date: AUGUST 1, 2010 Library of Definitions



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Completed by: Department of Treasury, Tax Policy Division E-mail address: Treas_Tax_Policy@michigan.gov Phone number: 517-373-9600 Date Submitted: September 22, 2010 Each of the items listed in the chart is defined in the Library of Definitions in the Streamlined Sales and Use Tax Agreement (SSUTA) as amended through April 30, 2010. Refer to Appendix C of the SSUTA for each definition. Place an in the appropriate column under the heading Treatment of definition to indicate the treatment of each definition in your state. If a product definition was not adopted by your state, enter NA in the column under the heading Reference and indicate in the Treatment of definition columns the treatment of the product in your state. In accordance with the SSUTA, your state must adopt the definitions in the Library of Definitions that apply to your state without qualifications except for those allowed by the SSUTA. For this reason, do not enter any comments or qualifications in the two columns under the heading Treatment of definition. If your state has adopted a definition in the Library of Definitions with a qualification not specified in the SSUTA, do not place an in either column under the heading Treatment of definition but include a comment in the Reference column explaining the qualification. Enter the applicable statute/rule cite in the Reference column. Sellers and certified service providers are relieved from tax liability to the member state and its local jurisdictions for having charged and collected the incorrect amount of sales and use tax resulting from the seller or certified service provider relying on erroneous data provided by the member state relative to treatment of the terms defined in the Library of Definitions. This matrix references citations to both Michigan s Use Tax Act, MCL 205.91 et seq ( UTA ) and Michigan s General Sales Tax Act, MCL 205.51 et seq ( STA ). This matrix references product-based exemptions, and does not address all potentially applicable entity-based exemptions. Administrative Definitions Sales price: Identify how the options listed below are treated in your state. The following options may be excluded from the definition of sales price only if they are separately stated on the bill to the purchaser. Treatment of definition Included Excluded in Sales from Sales Price Price Reference Statute/Rule Cite/Comment Charges by the seller for any services necessary to complete the Sales price includes charges by the seller for any sale other than delivery and installation services necessary to complete the sale, UTA: MCL 205.92(f)(iii); STA: MCL 205.51(1)(d)((iii), but excludes a) gratuities/tips identified on guest check or billed to customer, and b) labor or service charges involved in maintenance and repair work on tangible personal SSTGB Form F0014 (Revised May 2010) 1

property of others if separately itemized. UTA: MCL 205.92(f)(1)(iii)(A),(B); STA: 205.51(1)(d)(iii)(A),(B). Telecommunication nonrecurring charges UTA: MCL 205.92(f) (included in purchase price). Telecommunications nonrecurring charges are exempt from tax under MCL 205.93a(1)(a) & (c). Installation charges Sales price includes only installation charges incurred or to be incurred before the completion of the transfer of ownership of tangible personal property from the seller to the purchaser. UTA: MCL 205.92(f)(v); STA: MCL 205.51(1)(d)(v). Value of trade-in UTA: MCL 205.92(f)(vi); STA: MCL 205.51(1)(d)(vi). Delivery Charges for personal property or services other than direct mail. The following charges are included in the definition of sales price unless your state excludes them from sales price when such charges are separately stated on the bill to the purchaser. For responses below assume the charges are separately stated on the bill to the purchaser. Handling, crating, packing, preparation for mailing or delivery, and similar charges Included in Sales Price Excluded from Sales Price Statute/Rule Cite/Comment UTA: MCL 205.92(f)(iv); STA: MCL 205.51(1)(d)(iv). Transportation, shipping, postage, and similar charges UTA: MCL 205.92(f)(iv); STA: MCL 205.51(1)(d)(iv). Delivery Charges for direct mail. The following charges are included in the definition of sales price unless your state excludes them from sales price when such charges are separately stated on the bill to the purchaser. For responses below assume the charges are separately stated on the bill to the purchaser. Included in Sales Price Excluded from Sales Price Statute/Rule Cite/Comment Handling, crating, packing, preparation for mailing or delivery, and UTA: MCL 205.92b(e); STA: MCL 205.51a(e). similar charges Transportation, shipping, and similar charges UTA: MCL 205.92b(e); STA: MCL 205.51a(e). Postage UTA: MCL 205.92b(e); STA: MCL 205.51a(e). Sales Tax Holidays Yes No Statute/Rule Cite/Comment Sales Tax Holidays: Does your state have a sales tax holiday? If yes, indicate the tax treatment during your state sales tax Amount of Taxable Exempt Statute/Rule Cite/Comment holiday for the following products. Threshold All Energy star qualified products Specific energy star qualified products or energy star qualified classifications SSTGB Form F0014 (Revised May 2010) 2

All Disaster Preparedness Supply Specific Disaster Preparedness Supply Disaster preparedness general supply Disaster preparedness safety supply Disaster preparedness food-related supply Disaster preparedness fastening supply School supply School art supply School instructional material School computer supply Other products defined in Part II of the Library of Definitions included in your state sales tax holiday. Clothing Computers Prewritten computer software Product Definitions Amount of Threshold Taxable Exempt Statute/Rule Cite/Comment Clothing and related products Taxable Exempt Statute/Rule Cite/Comment Clothing UTA: MCL 205.92(k) and 205.93; Essential clothing priced below a state specific threshold UTA: MCL 205.92(k) and 205.93; Fur clothing UTA: MCL 205.92(k) and 205.93; Clothing accessories or equipment UTA: MCL 205.92(k) and 205.93; Protective equipment UTA: MCL 205.92(k) and 205.93; Sport or recreational equipment UTA: MCL 205.92(k) and 205.93; Computer related products Taxable Exempt Statute/Rule Cite/Comment Computer UTA: MCL 205.92(k) and 205.93; SSTGB Form F0014 (Revised May 2010) 3

Prewritten computer software UTA: MCL 205.92(k) and 205.93; Prewritten computer software delivered electronically UTA: MCL 205.92(k) and 205.93; Prewritten computer software delivered via load and leave UTA: MCL 205.92(k) and 205.93; Non-prewritten (custom) computer software UTA: MCL 205.94a(d); Non-prewritten (custom) computer software delivered electronically UTA: MCL 205.94a(d); Non-prewritten (custom) computer software delivered via load and leave UTA: MCL 205.94a(d); Mandatory computer software maintenance contracts Taxable Exempt Statute/Rule Cite/Comment Mandatory computer software maintenance contracts with respect to prewritten computer software UTA: MCL 205.92(k) and 205.93; Mandatory computer software maintenance contracts with respect to prewritten computer software which is delivered electronically UTA: MCL 205.92(k) and 205.93; Mandatory computer software maintenance contracts with respect to prewritten computer software which is delivered via load and leave UTA: MCL 205.92(k) and 205.93; Mandatory computer software maintenance contracts with respect to non-prewritten (custom) computer software UTA: MCL 205..94a(d); Mandatory computer software maintenance contracts with respect to non-prewritten (custom) software which is delivered electronically Mandatory computer software maintenance contracts with respect to non-prewritten (custom) software which is delivered via load and leave SSTGB Form F0014 (Revised May 2010) 4 UTA: MCL 205..94a(d); UTA: MCL 205..94a(d); Optional computer software maintenance contracts Taxable Exempt Statute/Rule Cite/Comment Optional computer software maintenance contracts with respect to prewritten computer software that only provide updates or upgrades with respect to the software UTA: MCL 205.92(k) and 205.93; Optional computer software maintenance contracts with respect to prewritten computer software that only provide updates or upgrades delivered electronically with respect to the software Optional computer software maintenance contracts with respect to prewritten computer software that only provide updates or upgrades delivered via load and leave with respect to the UTA: MCL 205.92(k) and 205.93; UTA: MCL 205.92(k) and 205.93;

software Optional computer software maintenance contracts with respect to non-prewritten (custom) computer software that only provide updates or upgrades with respect to the software Optional computer software maintenance contracts with respect to non-prewritten (custom) computer software that only provide updates or upgrades delivered electronically with respect to the software Optional computer software maintenance contracts with respect to non-prewritten (custom) computer software that only provide updates or upgrades delivered via load and leave with respect to the software Optional computer software maintenance contracts with respect to non-prewritten (custom) computer software that only provide support services to the software Optional computer software maintenance contracts with respect to non-prewritten (custom) computer software that provide updates or upgrades and support services to the software Optional computer software maintenance contracts with respect to non-prewritten (custom) computer software that provide updates or upgrades delivered electronically and support services to the software Optional computer software maintenance contracts with respect to non-prewritten (custom) computer software provide updates or upgrades delivered via load and leave and support services to the software Indicate your state s tax treatment for optional computer software maintenance contracts with respect to prewritten computer software sold for one non-itemized price that include updates and upgrades and/or support services. Use percentages in the taxable and exempt columns to denote tax treatment in your state. For example: if all taxable put 100% in the taxable column; if all nontaxable/exempt put 100% in the exempt column; if 50% taxable and 50% nontaxable/exempt put 50% in the taxable column and 50% in the exempt column. Optional computer software maintenance contracts with respect to prewritten computer software that provide updates or upgrades and support services to the software Optional computer software maintenance contracts with respect to prewritten computer software that provide updates and upgrades delivered electronically and support services to the software SSTGB Form F0014 (Revised May 2010) 5 UTA: MCL 205.94a(d); STA: MCL 205.54d(g)). UTA: MCL 205.94a(d); STA: MCL 205.54d(g). UTA: MCL 205.94a(d); STA: MCL 205.54d(g). UTA: MCL 205.94a(d); STA: MCL 205.54d(g). UTA: MCL 205.94a(d); STA: MCL 205.54d(g). UTA: MCL 205.94a(d); STA: MCL 205.54d(g). UTA: MCL 205.94a(d); STA: MCL 205.54d(g). Taxable Exempt Statute/Rule Cite/Comment 100% UTA: MCL 205.92(k) and 205.93; 100% UTA: MCL 205.92(k) and 205.93;

Optional computer software maintenance contracts with respect to prewritten computer software that provide updates and upgrades delivered via load and leave and support services to the software Optional computer software maintenance contracts with respect to prewritten computer software that only provide support services to the software 100% UTA: MCL 205.92(k) and 205.93; 100% UTA: MCL 205.92(k) and 205.93; Digital products(excludes telecommunications services, ancillary services Yes No Statute/Rule Cite/Comment and computer software) A state imposing tax on products transferred electronically is not required to adopt definitions for specified digital products. ( Specified digital products includes the defined terms: digital audio visual works; digital audio works; and digital books.) Does your state impose tax on products transferred electronically other than digital audio visual works, digital audio Tax is imposed on prewritten computer software delivered electronically. UTA: MCL 205.92(k) and 205.93; works, or digital books? Taxable Exempt Statute/Rule Cite/Comment Digital audio visual works sold to an end user with rights for permanent use Digital audio works sold to an end user with rights for permanent use Digital books sold to an end user with rights for permanent use For transactions other than those included above, a state must specifically Yes No Statute/Rule Cite/Comment impose and separately enumerate a broader imposition of the tax. Does your state impose tax on: Digital audio visual works sold to users other than the end user. Digital audio visual works sold with rights of use less than permanent use. Digital audio visual works sold with rights of use conditioned on continued payment. Digital audio works sold to users other than the end user. Digital audio works sold with rights of use less than permanent. Digital audio works sold with rights of use conditioned on continued payments. Digital books sold to users other than the end user. Digital books sold with rights of use less than permanent. Digital books sold with rights of use conditioned on continued payments. SSTGB Form F0014 (Revised May 2010) 6

Does your state treat subscriptions to products transferred electronically differently than a non-subscription purchase of such product? Section 332H provides that states may have product based exemptions for specific items within specified digital products. ( Specified digital products includes the defined terms: digital audio visual works; digital audio works; and digital books.) List product based exemptions for specific items included in specified digital products. NA Statute/Rule Cite/Comment Food and food products Taxable Exempt Statute/Rule Cite/Comment Food and food ingredients excluding alcoholic beverages and UTA: MCL 205.94d(1)(a),(3); tobacco STA: MCL 205.54g(1)(a),(3). o Candy UTA: MCL 205.94d(1)(a); STA: MCL 205.54g(1)(a). o Dietary Supplements UTA: MCL 205.94d(1)(a); STA: MCL 205.54g(1)(a). o Soft Drinks UTA: MCL 205.94d(1)(a); STA: MCL 205.54g(1)(a). o Bottled Water UTA: MCL 205.94(1)(q); STA: MCL 205.54d(d). Food sold through vending machines Food sold through vending machines that is either heated or cooled is taxed, except milk, non-alcoholic beverages in sealed containers, and fresh fruit are exempt. UTA: MCL 205.94d(2); STA: MCL 205.54g(2). Prepared Food UTA: MCL 205.94d(1)(a); STA: MCL 205.54g(1)(a). Prepared food options - indicate whether the following options are included or excluded from the definition of prepared food. Options excluded from prepared food are taxed the same as food and food ingredients. Included in definition Excluded from definition Statute/Rule Cite/Comment Food sold without eating utensils provided by the seller whose Prepared food is defined without reference to primary NAICS classification is manufacturing in sector 311, particular sellers. except subsector 3118 (bakeries) UTA: MCL 94d(4)-(6); STA: MCL 205.54g(4)-(6). Food sold without eating utensils provided by the seller in an UTA: MCL 205.94d(5)(c); STA: MCL 205.54g(5)(c). unheated state by weight or volume as a single item Bakery items sold without eating utensils provided by the seller, including bread, rolls, buns, biscuits, bagels, croissants, UTA: MCL 205.94d(5)(d); STA: MCL 205.54g(5)(d). pastries, donuts, Danish, cakes, tortes, pies, tarts, muffins, bars, cookies, tortillas SSTGB Form F0014 (Revised May 2010) 7

Health-care products Taxable Exempt Statute/Rule Cite/Comment Drugs (indicate how the options are treated in your state) Drugs for human use Drugs for human use without a prescription Drugs dispensed for human use that can only be legally dispensed pursuant to prescription of a qualified health professional are exempt whether or not a prescription is actually issued. UTA: MCL 205.94d(1)(a); STA: MCL 205.54g(1)(a). All other drugs are taxable whether or not a prescription is issued. UTA: MCL 205.93(1); STA: MCL 205.52. Drugs for human use with a prescription Drugs dispensed for human use that can only be legally dispensed pursuant to prescription of a qualified health professional are exempt whether or not a prescription is actually issued. UTA: MCL 205.94d(1)(a); STA: MCL 205.54g(1)(a). All other drugs are taxable whether or not a prescription is issued. UTA: MCL 205.93(1); STA: MCL 205.52. Insulin for human use without a prescription UTA: MCL 205.94a(g); STA: MCL 205.54d(l) Insulin for human use with a prescription UTA: MCL 205.94a(g); STA: MCL 205.54d(l) Medical oxygen for human use without a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Medical oxygen for human use with a prescription UTA: MCL 205.94a(f); STA: MCL 205.54d(k) Over-the-counter drugs for human use without a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Over-the-counter drugs for human use with a prescription Drugs dispensed for human use that can only be legally dispensed pursuant to prescription of a qualified health professional are exempt whether or not a prescription is actually issued. UTA: MCL 205.94d(1)(a); STA: MCL 205.54g(1)(a). All other drugs are taxable whether or not a prescription is issued. UTA: MCL 205.93(1); STA: MCL 205.52. Grooming and hygiene products for human use UTA: MCL 205.93(1); STA: MCL 205.52. Drugs for human use to hospitals Sales of insulin, and drugs for human use that can only be legally dispensed by prescription, are exempt. UTA: MCL 205.94a(g) & 205.94d(1)(a); STA: MCL 205.54d(l) & 205.54g(1)(a). Other drug sales are taxable. UTA: MCL 205.93(1); STA: MCL 205.52. Included among entity-based exemptions are exemptions for nonprofit hospitals. UTA: MCL 205.94(1)(h); STA: MCL 205.54a(1)(a). Drugs for human use to other medical facilities Sales of insulin, and drugs for human use that can only be legally dispensed by prescription, are exempt. SSTGB Form F0014 (Revised May 2010) 8

UTA: MCL 205.94a(g) & 205.94d(1)(a); STA: MCL 205.54d(l) & 205.54g(1)(a). Other drug sales are taxable. UTA: MCL 205.93(1); STA: MCL 205.52. Included among entity-based exemptions are exemptions for nonprofit hospitals. UTA: MCL 205.94(1)(h); STA: MCL 205.54a(1)(a). Prescription drugs for human use to hospitals Sales of insulin, and drugs for human use that can only be legally dispensed by prescription, are exempt. UTA: MCL 205.94a(g) & 205.94d(1)(a); STA: MCL 205.54d(l) & 205.54g(1)(a). Other drug sales are taxable. UTA: MCL 205.93(1); STA: MCL 205.52. Included among entity-based exemptions are exemptions for nonprofit hospitals. UTA: MCL 205.94(1)(h); STA: MCL 205.54a(1)(a). Prescription drugs for human use to other medical facilities Sales of insulin, and drugs for human use that can only be legally dispensed by prescription, are exempt. UTA: MCL 205.94a(g) & 205.94d(1)(a); STA: MCL 205.54d(l) & 205.54g(1)(a). Other drug sales are taxable. UTA: MCL 205.93(1); STA: MCL 205.52. Included among entity-based exemptions are exemptions for nonprofit hospitals. UTA: MCL 205.94(1)(h); STA: MCL 205.54a(1)(a). Free samples of drugs for human use Transfers of insulin, and drugs for human use that can only be legally dispensed by prescription, are exempt. UTA: MCL 205.94a(g) & 205.94d(1)(a); STA: MCL 205.54d(l) & 205.54g(1)(a). Other drug transfers are taxable, whether or not a prescription is issued. UTA: MCL 205.93(1); STA: MCL 205.52. Free samples of prescription drugs for human use Transfers of insulin, and drugs for human use that can only be legally dispensed by prescription, are exempt. UTA: MCL 205.94a(g) & 205.94d(1)(a); STA: MCL 205.54d(l) & 205.54g(1)(a). Other drug transfers are taxable, whether or not a prescription is issued. UTA: MCL 205.93(1); STA: MCL 205.52. Drugs for animal use Drugs for animal use without a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Drugs for animal use with a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Insulin for animal use without a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Insulin for animal use with a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Medical oxygen for animal use without a prescription UTA: MCL 205.93(1); STA: MCL 205.52. SSTGB Form F0014 (Revised May 2010) 9

Medical oxygen for animal use with a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Over-the-counter drugs for animal use without a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Over-the-counter drugs for animal use with a prescription UTA: MCL 205.93(1); STA: MCL 205.52. Grooming and hygiene products for animal use UTA: MCL 205.93(1); STA: MCL 205.52. Drugs for animal use to veterinary hospitals and other animal medical facilities UTA: MCL 205.93(1); STA: MCL 205.52. Prescription drugs for animal use to hospitals and other animal medical facilities UTA: MCL 205.93(1); STA: MCL 205.52. Free samples of drugs for animal use UTA: MCL 205.93(1); STA: MCL 205.52. Free samples of prescription drugs for animal use UTA: MCL 205.93(1); STA: MCL 205.52. Durable medical equipment (indicate how the options are treated in your Taxable Exempt Statute/Rule Cite/Comment state) Durable medical equipment without a prescription Durable medical equipment with a prescription Exempt if for home use. Durable medical equipment with a prescription paid for by Medicare Durable medical equipment with a prescription reimbursed by Medicare Exempt if: 1. for home use, OR; 2. purchased directly by: Exempt if for home use. Durable medical equipment with a prescription paid for by Medicaid Exempt if: 1. for home use, SSTGB Form F0014 (Revised May 2010) 10

Durable medical equipment with a prescription reimbursed by Medicaid OR; 2. purchased directly by: Exempt if for home use. Durable medical equipment for home use without a prescription Durable medical equipment for home use with a prescription Durable medical equipment for home use with a prescription paid for by Medicare Durable medical equipment for home use with a prescription reimbursed by Medicare Durable medical equipment for home use with a prescription paid for by Medicaid Durable medical equipment for home use with a prescription reimbursed by Medicaid Oxygen delivery equipment without a prescription Oxygen delivery equipment with a prescription Exempt if for home use. Oxygen delivery equipment with a prescription paid for by Medicare Exempt if: 1. for home use, OR; 2. purchased directly by: SSTGB Form F0014 (Revised May 2010) 11

Oxygen delivery equipment with a prescription reimbursed by Medicare Oxygen delivery equipment with a prescription paid for by Medicaid Oxygen delivery equipment with a prescription reimbursed by Medicaid SSTGB Form F0014 (Revised May 2010) 12 Exempt if for home use. Exempt if: 1. for home use, OR; 2. purchased directly by: Exempt if for home use. Oxygen delivery equipment for home use without a prescription Oxygen delivery equipment for home use with a prescription Oxygen delivery equipment for home use with a prescription paid for by Medicare Oxygen delivery equipment for home use with a prescription reimbursed by Medicare Oxygen delivery equipment for home use with a prescription paid for by Medicaid

Oxygen delivery equipment for home use with a prescription reimbursed by Medicaid Kidney dialysis equipment without a prescription Kidney dialysis equipment with a prescription Exempt if for home use. Kidney dialysis equipment with a prescription paid for by Medicare Exempt if: 1. for home use, OR; 2. purchased directly by: Kidney dialysis equipment with a prescription reimbursed by Medicare Exempt if for home use. Kidney dialysis equipment with a prescription paid for by Medicaid Exempt if: 1. for home use, OR; 2. purchased directly by: SSTGB Form F0014 (Revised May 2010) 13

Kidney dialysis equipment with a prescription reimbursed by Medicaid Exempt if for home use. Kidney dialysis equipment for home use without a prescription Kidney dialysis equipment for home use with a prescription Kidney dialysis equipment for home use with a prescription paid for by Medicare Kidney dialysis equipment for home use with a prescription reimbursed by Medicare Kidney dialysis equipment for home use with a prescription paid for by Medicaid Kidney dialysis equipment for home use with a prescription reimbursed by Medicaid Enteral feeding systems without a prescription Enteral feeding systems with a prescription Exempt if for home use. Enteral feeding systems with a prescription paid for by Medicare Exempt if: 1. for home use, OR; 2. purchased directly by: Enteral feeding systems with a prescription reimbursed by Exempt if for home use. Medicare SSTGB Form F0014 (Revised May 2010) 14

Enteral feeding systems with a prescription paid for by Medicaid Exempt if: 1. for home use, OR; 2. purchased directly by: Enteral feeding systems with a prescription reimbursed by Medicaid Mobility enhancing equipment (indicate how the options are treated in Taxable Exempt Statue/Rule Cite/Comment your state) Mobility enhancing equipment without a prescription UTA: MCL 205.92b(m) and 205.94(1)(p); SSTGB Form F0014 (Revised May 2010) 15 Exempt if for home use. Enteral feeding systems for home use without a prescription Enteral feeding systems for home use with a prescription Enteral feeding systems for home use with a prescription paid for by Medicare Enteral feeding systems for home use with a prescription reimbursed by Medicare Enteral feeding systems for home use with a prescription paid for by Medicaid Enteral feeding systems for home use with a prescription reimbursed by Medicaid Repair and replacement parts for durable medical equipment which are for single patient use Exempt if the durable medical equipment is for home use and was dispensed pursuant to a prescription. UTA: MCL 205.92b(i), (j) and 205.94(1)(p); STA: MCL 205.51a(i), (j) and 205.54a(1)(h).

STA: MCL 205.51a(m) and 205.54a(1)(h). Mobility enhancing equipment with a prescription UTA: MCL 205.92b(m) and 205.94(1)(p); STA: MCL 205.51a(m) and 205.54a(1)(h). Mobility enhancing equipment with a prescription paid for by Medicare UTA: MCL 205.92b(m) and 205.94(1)(p); STA: MCL 205.51a(m) and 205.54a(1)(h). Mobility enhancing equipment with a prescription reimbursed by Medicare UTA: MCL 205.92b(m) and 205.94(1)(p); STA: MCL 205.51a(m) and 205.54a(1)(h). Mobility enhancing equipment with a prescription paid for by Medicaid UTA: MCL 205.92b(m) and 205.94(1)(p); STA: MCL 205.51a(m) and 205.54a(1)(h). Mobility enhancing equipment with a prescription reimbursed by Medicaid Prosthetic devices (indicate how the options are treated in your state) Taxable Exempt Statute/Rule Cite/Comment Prosthetic devices without a prescription UTA: MCL 205.92b(p) and 205.94(1)(p); STA: MCL 205.51a(p) and 205.54a(1)(h). Prosthetic devices with a prescription Exempt, except that contact lenses and dental prostheses are excluded from the definition of prosthetic device and are taxable. UTA: MCL 205.92b(p) and 205.94(1)(p); STA: MCL 205.51a(p) and 205.54a(1)(h). Prosthetic devices with a prescription paid for by Medicare Exempt, except that contact lenses and dental prostheses are excluded from the definition of prosthetic device and are taxable. UTA: MCL 205.92b(p) and 205.94(1)(p); STA: MCL 205.51a(p) and 205.54a(1)(h). Prosthetic devices with a prescription reimbursed by Medicare Exempt, except that contact lenses and dental prostheses are excluded from the definition of prosthetic device and are taxable. UTA: MCL 205.92b(p) and 205.94(1)(p); STA: MCL 205.51a(p) and 205.54a(1)(h). Prosthetic devices with a prescription paid for by Medicaid Exempt, except that contact lenses and dental prostheses are excluded from the definition of prosthetic device and are taxable. UTA: MCL 205.92b(p) and 205.94(1)(p); STA: MCL 205.51a(p) and 205.54a(1)(h). Prosthetic devices with a prescription reimbursed by Medicaid Exempt, except that contact lenses and dental prostheses are excluded from the definition of prosthetic device and are taxable. UTA: MCL 205.92b(p) and 205.94(1)(p); STA: MCL 205.51a(p) and 205.54a(1)(h). SSTGB Form F0014 (Revised May 2010) 16 UTA: MCL 205.92b(m) and 205.94(1)(p); STA: MCL 205.51a(m) and 205.54a(1)(h).

Corrective eyeglasses without a prescription UTA: MCL 205.92b(p); STA: MCL 205.51a(p). Corrective eyeglasses with a prescription UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Corrective eyeglasses with a prescription paid for by Medicare UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Corrective eyeglasses with a prescription reimbursed by Medicare UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Corrective eyeglasses with a prescription paid for by Medicaid UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Corrective eyeglasses with a prescription reimbursed by Medicaid UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Contact lenses without a prescription UTA: MCL 205.92b(p); STA: MCL 205.51a(p). Contact lenses with a prescription UTA: MCL 205.92b(p); STA: MCL 205.51a(p). Contact lenses with a prescription paid for by Medicare Exempt only if purchased directly by: Contact lenses with a prescription reimbursed by Medicare UTA: MCL 205.92b(p); STA: MCL 205.51a(p). Contact lenses with a prescription paid for by Medicaid Exempt only if purchased directly by: Contact lenses with a prescription reimbursed by Medicaid UTA: MCL 205.92b(p); STA: MCL 205.51a(p). Hearing aids without a prescription UTA: MCL 205.92b(p); STA: MCL 205.51a(p) Hearing aids with a prescription UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Hearing aids with a prescription paid for by Medicare UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Hearing aids with a prescription reimbursed by Medicare UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Hearing aids with a prescription paid for by Medicaid UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Hearing aids with a prescription reimbursed by Medicaid UTA: MCL 205.94(1)(p); STA: MCL 205.54a(1)(h). Dental prosthesis without a prescription Dental prostheses are excluded from the definition of SSTGB Form F0014 (Revised May 2010) 17

prosthetic device, UTA: MCL 205.92b(p); STA: MCL 205.51a(p), are taxable to the dental care provider as tangible personal property consumed in providing the service, UTA: MCL 205.93; STA: MCL 205.52(1), and are not considered to be sold by the care provider separate from the service. 1979 AC, R 205.111. Dental prosthesis with a prescription Dental prostheses are excluded from the definition of prosthetic device, UTA: MCL 205.92b(p); STA: MCL 205.51a(p), are taxable to the dental care provider as tangible personal property consumed in providing the service, UTA: MCL 205.93; STA: MCL 205.52(1), and are not considered to be sold by the care provider separate from the service. 1979 AC, R 205.111. Dental prosthesis with a prescription paid for by Medicare Dental prostheses are excluded from the definition of prosthetic device, UTA: MCL 205.92b(p); STA: MCL 205.51a(p), are taxable to the dental care provider as tangible personal property consumed in providing the service, UTA: MCL 205.93; STA: MCL 205.52(1), and are not considered to be sold by the care provider separate from the service. 1979 AC, R 205.111. Also, exempt if purchased directly by: Dental prosthesis with a prescription reimbursed by Medicare Dental prostheses are excluded from the definition of prosthetic device, UTA: MCL 205.92b(p); STA: MCL 205.51a(p), are taxable to the dental care provider as tangible personal property consumed in providing the service, UTA: MCL 205.93; STA: MCL 205.52(1), and are not considered to be sold by the care provider separate from the service. 1979 AC, R 205.111 Dental prosthesis with a prescription paid for by Medicaid Dental prostheses are excluded from the definition of prosthetic device, UTA: MCL 205.92b(p); STA: MCL SSTGB Form F0014 (Revised May 2010) 18

205.51a(p), are taxable to the dental care provider as tangible personal property consumed in providing the service, UTA: MCL 205.93; STA: MCL 205.52(1), and are not considered to be sold by the care provider separate from the service. 1979 AC, R 205.111. Also, exempt if purchased directly by: Dental prosthesis with a prescription reimbursed by Medicaid Dental prostheses are excluded from the definition of prosthetic device, UTA: MCL 205.92b(p); STA: MCL 205.51a(p), are taxable to the dental care provider as tangible personal property consumed in providing the service, UTA: MCL 205.93; STA: MCL 205.52(1), and are not considered to be sold by the care provider separate from the service. 1979 AC, R 205.111 Telecommunications & related products Taxable Exempt Statute/Rule Cite/Comment Ancillary Services UTA: MCL 205.93a(1)(a), (c) & 205.93a(5)(a) Conference bridging service UTA: MCL 205.93a(1)(a), (c) & 205.93a(5)(d) Detailed telecommunications billing service UTA: MCL 205.93a(1)(a), (c) & 205.93a(5)(a) Directory assistance UTA: MCL 205.93a(1)(a), (c) & 205.93a(5)(a) Vertical service UTA: MCL 205.93a(1)(a), (c) & 205.93a(5)(a) Voice mail service UTA: MCL 205.93a(1)(a), (c) & 205.93a(5)(a) Telecommunications (Indicate how the options are treated in your state) Taxable Exempt Statute/Rule Cite/Comment Intrastate Telecommunications Service UTA: MCL 205.93a(1)(a) Interstate Telecommunications Service UTA: MCL 205.93a(1)(c) International Telecommunications Service UTA: MCL 205.93a(1)(c) International 800 service UTA: MCL 205.93a(1)(c) International 900 service UTA: MCL 205.93a(1)(c) International fixed wireless service UTA: MCL 205.93a(1)(c) SSTGB Form F0014 (Revised May 2010) 19

International mobile wireless service UTA: MCL 205.93b(1) International prepaid calling service UTA: MCL 205.93a(1)(c) International prepaid wireless calling service UTA: MCL 205.93a(1)(c) International private communications service UTA: MCL 205.93a(1)(c) International value-added non-voice data service UTA: MCL 205.93a(1)(c) International residential telecommunications service UTA: MCL 205.93a(1)(c) Interstate 800 service UTA: MCL 205.93a(1)(c) Interstate 900 service UTA: MCL 205.93a(1)(c) Interstate fixed wireless service UTA: MCL 205.93a(1)(c) Interstate mobile wireless service UTA: MCL 205.93b(1) Interstate prepaid calling service STA: MCL 205.52(2)(b) Interstate prepaid wireless calling service UTA: MCL 205.93b(1) Interstate private communications service UTA: MCL 205.93a(1)(c) Interstate value-added non-voice data service UTA: MCL 205.93a(1)(c) Interstate residential telecommunications service UTA: MCL 205.93a(1)(c) Intrastate 800 service UTA: MCL 205.93a(1)(a) Intrastate 900 service UTA: MCL 205.93a(1)(a) Intrastate fixed wireless service UTA: MCL 205.93a(1)(a) Intrastate mobile wireless service UTA: MCL 205.93b(1) Intrastate prepaid calling service STA: MCL 205.52(2)(b) Intrastate prepaid wireless calling service UTA: MCL 205.93b(1) Intrastate private communications service UTA: MCL 205.93a(1)(a) Intrastate value-added non-voice data service UTA: MCL 205.93a(1)(a) Intrastate residential telecommunications service UTA: MCL 205.93a(1)(a) Paging service One-way paging service is exempt. UTA: MCL 205.93a(1)(a),(c) Coin-operated telephone service UTA: MCL 205.93a(1)(a),(c) Pay telephone service Coin-operated service is exempt; other pay telephone service is taxable. UTA: MCL 205.93a(1)(a),(c) Local Service as defined by Michigan UTA: MCL 205.93a(1)(a) SSTGB Form F0014 (Revised May 2010) 20