Michigan Car Buyers Could Soon Get Tax Break On Trade-ins
Michigan car buyers who trade in old vehicles for new ones would get a tax break under bills in the state Legislature.
The Michigan Public Radio Network’s Jake Neher reports.
Say you’re trading in a car worth ten-thousand dollars to buy a $30,000 car. Right now, you have to pay sales tax on the full price of the new vehicle. Under this legislation, you would only pay sales tax on $20,000. In other words, the value of the trade-in would be deducted from the taxable value of the car.
Senate Majority Leader Randy Richardville says it would be a boost to the state’s economy.
“I’m excited because we’re giving something back to the average consumer,” he says. “And not only something back - we’re giving something back that relates to the auto industry, which is kind of big in Michigan.”
The change would also apply to boats and RVs. It’s expected to get final legislative approval this week.