HB 5779 Summary

• Establishes the "Qualified Heavy Equipment Rental Personal Property Specific Tax Act" creating a 2% tax on rental transactions of qualified heavy equipment, effective January 1, 2021.

• Exempts qualified heavy equipment rental personal property from ad valorem property taxes beginning December 31, 2020, if the renter files an annual exemption claim with the Department of Treasury by December 1.

• Creates a qualified heavy equipment rental personal property tax fund to collect all proceeds, with administrative costs up to $250,000 going to the Department of Treasury and remaining revenue distributed 90% to local units with rental offices/storage facilities and 10% to units without such facilities.

• Requires qualified renters to collect and remit the tax quarterly based on rental prices and maintain records for 4 years; imposes penalties of 1% per week (maximum 5%) for late payment plus 1.5% monthly interest.

• Excludes rentals to government entities, federally recognized Indian tribes, and transactions where equipment is rented from or delivered outside Michigan; does not apply to bill if HB 5778 is not enacted.