Michigan Sales Tax

Michigan Sales Tax Guide (2026)

6% at every address in the state, and it is not a rate the legislature can simply raise: the ceiling sits in the Michigan Constitution.[1]

5 min read • Reviewed by Tax Advisory Team • Verified • Sources: MI Treasury & MCL
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Quick Facts

Sales Tax at a Glance

Statewide rate
6% [1]
Local sales tax
None [2]
Constitutional maximum
6% [3]
Residential energy rate
4% [1]
Economic nexus
$100k OR 200 sales [4]
Groceries
Constitutionally exempt [5]
Digital goods
Not taxable [6]
Licence fee
None, renewed yearly [7]
Discount base
Two-thirds of the tax [8]
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The vendor discount is calculated on two-thirds of the tax, not all of it

Michigan’s 6% is two constitutional layers: an older 4% and the 2% added in 1994 and dedicated to schools. The timely-payment discount attaches only to the older layer, which is why every discount formula multiplies by .6667 first.[8]

Pay by the 12th: tax × .6667 × .0075 Pay by the 20th: tax × .6667 × .005 $20,000 cap per period on the earlier date $15,000 cap on the later date Effective 0.5%, not 0.75% Forfeited entirely if you pay late
Quoting the headline percentages overstates the benefit by half. No discount is allowed on the 2% school layer, so a model built on a flat 0.75% of tax collected will over-accrue every period.[8]
Estimate

Michigan sales tax calculator

Michigan · statewide rate 6%
There is no local sales tax anywhere in Michigan.
Rate applied–
Estimated sales tax–
Total with tax–

Estimate only. Delivery and installation charges are excluded from the base only when separately stated on the invoice and separately recorded in your books.[9] Talk to CrownGlobe about software classification.

Rates & Registration

Michigan Sales Tax Rates, Nexus & the constitutional ceiling

How Michigan’s 6% is built

Sales tax on retail sales6%
Complementary use tax6%
Local city or county add-onNone
Residential energy & heating fuels4%
Constitutional maximum rate6%

Raising the rate would require amending the state Constitution rather than passing an ordinary act, which is why the figure has stood since 1994.[3]

Who must register

Either trigger applies: economic nexus at more than $100,000 of gross sales into Michigan or 200 or more separate transactions in the previous calendar year, or any physical presence. Michigan has not repealed its transaction test.[4]

Cloud services turn on delivery of code: software that stays on the vendor’s servers and is reached through a browser is generally outside the tax, but shipping a desktop client alongside it can supply the delivery element that brings the transaction back in.[6]

Compliance

Sales Tax Registration and Filing

Michigan sales tax licences are issued without a fee.

How to register

  • Confirm nexus→
  • Michigan Treasury Online registration→
  • Licence issued free→
  • Valid for the calendar year→
  • Renew annually

Licences run January through December of the year printed on them, so they must be renewed each calendar year even though there is no charge.[7]

Filing & due dates

FrequencyEstimated monthly paymentDue
MonthlyOver $1,00020th of next month
Quarterly$84 to $99920th after quarter
AnnualUp to $83Feb 28
Accelerated EFT$720,000 or more a year20th, with prepayment

Failure to file or pay costs 5% of the unpaid tax for the first two months and 5% for each additional month up to 25%, with interest running at one point above the adjusted prime rate.[10]

Pricing

Sales Tax & Nexus Pricing

Multi Tax Filing – $50 Per State/Month

ServiceWhat’s Included
Multi-state registrationNexus tracking, permit setup, and state agency coordination.
Monthly filingSales tax returns filed in every registered state.
Exemption & audit supportCertificate handling and notice response.
Get Started with Multi-State Filing
Taxability

Taxable vs. exempt

Michigan taxes tangible goods and delivered prewritten software at 6%, and leaves digital goods, custom software and browser-only cloud services outside the base entirely.[1]

Generally taxable

  • Tangible retail goodsMCL 205.52
  • Prewritten software delivered by any meansMCL 205.51a(r)
  • Prepared food for immediate consumptionMCL 205.54g
  • Delivery charges not separately statedMCL 205.51(1)(d)(xv)
  • Regulated utility transmission chargesMCL 205.51(1)(o)
  • Marketplace-facilitated salesMCL 205.52d

Generally exempt

  • Food for human consumptionConstitutional exemption
  • Prescription drugs for human useConstitutional exemption
  • Digital goods: e-books, streaming, musicNeither goods nor software
  • Custom computer softwareMCL 205.54d(g)
  • Bakery items sold without utensilsMCL 205.54g(3)(g)
  • Industrial processingMCL 205.54t
Worth flagging: delivery and installation charges escape tax only when the charge is separately stated on the invoice and the seller’s books separately record the transactions. Separate invoicing alone is not enough, and the books requirement is the leg auditors test.[9]
Reference

Glossary of key terms

Constitutional ceiling
Michigan’s 6% maximum sales tax rate, fixed in the state Constitution rather than by ordinary statute.
Complementary use tax
Michigan’s 6% tax on storage, use or consumption where sales tax was not paid.
Delivery (software)
The conveyance of coded instructions to a purchaser; Michigan taxes software only where delivery occurs.
Incidental to service test
The framework deciding whether property transferred in a mixed transaction is merely incidental to an untaxed service.
Timely-payment discount
Michigan’s vendor allowance, computed on two-thirds of the tax and capped per return period.
Prepared food sales percentage
A seller-level ratio recalculated annually that decides how strictly the eating-utensils test applies.
FAQ

Sales Tax FAQs

6% at every address. Michigan has no county, city or district sales tax, so there is no rate lookup to perform. Residential energy and home heating fuels carry a reduced 4% rate.

Because 6% is the maximum permitted under the state Constitution, raised from 4% only by a 1994 constitutional amendment. Increasing it would take another vote of the people rather than an ordinary act of the legislature.

No. Michigan treats e-books, streamed films, digital music, podcasts and audiobooks as neither tangible personal property nor computer software, so they fall outside the tax. Prewritten software downloaded electronically is different and remains taxable.

Generally not. Taxability requires the customer to receive and control a set of coded instructions, so software that stays on the vendor’s servers and is used through a browser is outside the tax. A bundled downloadable client can change that answer.

More than $100,000 in gross sales into Michigan or 200 or more separate transactions in the previous calendar year. Either prong triggers registration, and Michigan has not repealed its transaction test.

Less than the headline suggests. Because no discount is allowed on the 2% school layer of the tax, every formula multiplies the tax by .6667 first, so the effective allowance is 0.5% of tax collected if you pay by the 12th and 0.3333% if you pay by the 20th.

Verification

Sources & methodology

  1. MI Treasury – Sales & Use Tax
  2. MCL 205.52 – General Sales Tax Act
  3. MI Treasury – Sales and Use Taxes Report
  4. RAB 2021-21 – Nexus Standards for Remote Sellers
  5. RAB 2026-2 – Food for Human Consumption
  6. RAB 2023-10 – Software & Digital Goods
  7. MI Treasury – Constitutional Revenue Sharing
  8. MI Treasury – Form 5080 Instructions
  9. RAB 2023-16 – Delivery & Installation Charges
  10. RAB 2025-15 – Penalty Provisions
  11. RAB 2026-5 – Interest Rate
  12. RAB 2023-26 – Sales & Use Tax Sourcing
  13. RAB 2021-22 – Marketplace Facilitators
  14. MI Treasury – Form 518 Registration
Methodology: Every rate, threshold and discount figure is taken from the Michigan Department of Treasury’s bulletins and current tax year forms or the Michigan Compiled Laws directly. Discount percentages are read off the current return form rather than from secondary summaries, which routinely omit the two-thirds multiplier.
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