“We want to be sure boaters know that STOD went into full effect for boats as of November 15th with no phase-in period. One hundred percent of the trade in value on your current boat is tax free. Boaters will only pay tax on the difference between the trade in and the new boat purchase.” said MBIA Executive Director Nicki Polan.
For consumers waiting to make an upgrade on their vessels this could mean big savings! If a customer traded in a vessel valued at $40,000 for a new boat that was $80,000 they would only pay tax on the difference, $40,000. With the new law, that customer saves $2,400! Sales tax on the difference is a long-awaited tax break for Michiganders and finally puts Michigan on an even playing field with all of the surrounding Great Lakes states who had already implemented sales tax on the difference.
"The State of Michigan is now on the same page with our neighboring states in how sales tax is applied where a trade-in is involved. The boats sales we have lost over the years to neighboring states will now stay in Michigan. Additionally, this new law will make it more attractive for our customers to further re-invest in boating, leading to long term stimulation of Michigan's economy," said Mike Apling, Devils Lake Water Sports, Inc. in Manitou Beach, Mich.
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