Sales Tax in Michigan: A Complete Guide for Ecommerce Sellers

Michigan is an SST member state with one of the simplest rate structures of any major state: a flat 6% with no local additions. The same rate applies in Detroit, Grand Rapids, and every other Michigan location. Combined with SST membership, Michigan is among the easiest states to add to a multi-state compliance program.

Quick reference

Economic nexus

Michigan’s OR threshold: $100,000 in sales OR 200 or more transactions into Michigan in the current or prior calendar year. Either condition alone triggers registration.

Michigan enacted its economic nexus law effective October 1, 2018.

Physical nexus

Physical presence in Michigan creates nexus without any threshold:

• Warehouse, office, or storage facility in Michigan
• Amazon FBA inventory in Michigan fulfillment centers
• Employees, agents, or independent contractors in Michigan
• Sales representatives in Michigan

Registration

Michigan is an SST member state. Register through a Certified Service Provider for simultaneous registration in Michigan and all other SST states at no charge.

Sellers can also register directly with the Michigan Department of Treasury through Michigan Treasury Online (michigan.gov/taxes). Registration is free.

Tax rates

State rate: 6% flat

No local additions: Michigan does not allow counties, cities, or other local jurisdictions to levy additional sales taxes. The 6% state rate is the only rate, it applies uniformly across all Michigan locations.

This eliminates the jurisdiction-level rate complexity that creates compliance overhead in states like Illinois, Washington, or New York. Any Michigan ship-to address: 6%.

What’s taxable

Generally taxable: Electronics, clothing, furniture, sporting goods, toys, home goods, most tangible personal property.

Generally exempt:

• Prescription medications
• Food for human consumption (groceries — Michigan broadly exempts food)
• Agricultural equipment and materials
• Residential heating fuel

Notable Michigan rules:

• Clothing: Taxable in Michigan, no clothing exemption
• Digital products: Michigan taxes specified digital products, downloaded software, digital audio works, digital audiovisual works
• SaaS: Michigan taxes SaaS in certain circumstances, sellers of software-as-a-service into Michigan should confirm taxability for their specific product type
• Food: Michigan broadly exempts food for home consumption. Candy, soft drinks, and prepared food are taxable

Shipping taxability

Michigan taxes shipping and delivery charges when the shipped goods are taxable. When goods are exempt, the delivery charge is also exempt.

Marketplace facilitator rules

Michigan enacted marketplace facilitator legislation effective January 1, 2020. Qualifying marketplace facilitators collect and remit Michigan sales tax on marketplace-facilitated sales.

Remote sellers whose only Michigan sales are through marketplace facilitators and who have no physical nexus may not need to separately register. Sellers with Michigan physical nexus must register regardless.

State-specific notes

Flat statewide rate: Michigan’s single-rate structure eliminates rate lookup complexity. No county tables, no city lookups, no special districts — 6% applies everywhere in Michigan. This is a meaningful operational simplification for sellers who otherwise need rooftop-level calculation in every state.

SST membership + flat rate: Michigan is one of the most compliance-friendly states for remote sellers — SST registration covers it in one application, and the flat rate means calculation is straightforward. If you’re adding states to your compliance program, Michigan should be among the fastest to implement.

Use tax on business purchases: Michigan also levies a use tax on out-of-state purchases used in Michigan. Remote sellers who purchase inventory, equipment, or supplies for use in Michigan operations without paying Michigan sales tax may owe use tax. This typically comes up in physical-nexus situations.