AN ACT RELATING TO HEALTH AND SAFETY -- NURSING HOME WORKFORCE STANDARDS BOARD ACT

2025 Regular Session Introduced by Cherie Cruz and 8 co-sponsors

Exempts a qualified disabled veteran's personal-use motor vehicle from Michigan use tax, with revenue lost to the State School Aid Fund offset by deposits to that fund.

03/27/2025 Committee recommended measure be held for further study

Summary — HB 5257 (Use Tax: exemption for motor vehicle purchase by a qualified disabled veteran)

Status & timing
- Introduced: March 14, 2025 (rep. Emily Dievendorf). Electronically reproduced November 12, 2025; read first time and referred to Committee on Government Operations on November 12, 2025.
- Effective date in bill: January 1, 2026.
- Enactment condition: This bill does not take effect unless companion legislation (Senate Bill No. ____ or House Bill No. 5274 of the 103rd Legislature) is also enacted (tie-bar).

Purpose / intent
- To exempt from Michigan’s use tax the purchase of a motor vehicle sold to a “qualified disabled veteran,” when the vehicle will be registered to that veteran and used only for personal purposes.

Key provisions
- Adds a new section 4hh to the Use Tax Act (1937 PA 94, MCL 205.111 et seq.):
- Beginning January 1, 2026, a motor vehicle sold to a “qualified disabled veteran” and registered to that veteran for personal use is exempt from the state use tax.
- “Qualified disabled veteran” is defined by reference to the term as used in section 7b of the General Property Tax Act (1893 PA 206, MCL 211.7b).
- Amends section 21 (receipts/deposits) of the Use Tax Act to include subsection (3)(f):
- Requires the Department to determine and deposit into the State School Aid Fund an amount equal to the revenue lost to that fund as a result of the new exemption under section 4hh. (Section 21 already lists other exemptions whose revenue losses must be credited to the State School Aid Fund.)

Who is affected
- Eligible individuals: veterans who meet the “qualified disabled veteran” definition under MCL 211.7b and who buy a motor vehicle to be registered in their name for personal use.
- State and local finances: the exemption would reduce use-tax receipts associated with qualifying vehicle sales. However, the bill requires the State School Aid Fund to be made whole for any revenue lost from that fund due to the exemption; that implies the fiscal impact of the exemption would be shifted away from school aid and absorbed elsewhere in the state share of use-tax receipts (potentially reducing amounts otherwise credited to the general fund).

Notes / procedural aspects
- The effective date is January 1, 2026, but the bill contains a contingency that it only takes effect if a specified companion bill is enacted.
- The bill both adds an exemption (new §4hh) and explicitly changes deposit/accounting language in §21 to address how lost revenue to school aid is handled.

Fiscal implication (summary)
- Direct: lowers use-tax revenue collected from qualifying vehicle purchases.
- The bill mandates that any loss to the State School Aid Fund be identified and offset within the use tax deposit framework, meaning school aid receipts would be preserved while other state funds (general fund/state share) would absorb the cost unless other offsets are provided.