LANSING, Mich. — Michigan lawmakers are looking to jumpstart legislation that would save residents money when they trade in a used car, boat or recreational vehicle to purchase a new one, writes MLive.com.
MLive.com says current law requires customers to pay Michigan’s six percent sales tax on the full cost of a new vehicle even when offering a trade-in. But new legislation would gradually change state law by requiring that customers only pay tax on the difference owed.
A customer who buys a $20,000 car and trades in a used model worth $5,000, for instance, would currently pay $1,200 in sales tax, says MLive.com. Under the proposal, that same customer would pay only a $900 tax.
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