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Governor signs legislation to change sales tax on vehicle sales

LANSING (WKZO) -- Legislation to give Michigan residents a tax break when they buy a new vehicle while trading in an old one is now law. Right now, car buyers in the state are required to pay sales tax on the cost of a new vehicle, even if a trade-in lowers their actual out-of-pocket cost. Once the new law is implemented, those who trade in a vehicle when purchasing a new or used car could receive significant tax savings because the sales tax would be levied on the actual amount residents pay out of pocket, and not the new car's sticker price. State Representative Andrea LaFontaine says this gives Michiganders a break. The legislation, now known as Public Act 159 of 2013, will be gradually implemented.