Mich. Admin. Code R 205.67 — Fuel dealers

Rule 17. (1) The sale of coal, coke, wood, fuel oil, liquid petroleum gas, and other
fuel that is not otherwise exempt is taxable based on the sales or purchase price. The sale
for residential use of electricity, natural or artificial gas, or home heating fuels is exempt
from the sales tax at the additional rate of 2%, as approved by the electors on March 15,
1994.
(2) The sale of equipment, tools, materials and supplies, consumed or used in
handling and preparing fuel for market or delivery is taxable.
(3) The sale of bottled gas cylinders by dealers and distributors is subject to tax at
the time of sale. A dealer or distributor that rents bottled gas cylinders to its customers
may elect to pay use tax on the rental receipts instead of paying sales tax when the dealer
or distributor purchases the cylinder for use in its rental business. See R 205.132.
(4) The sale of fuel used in rail operations is exempt from tax, except for use in
vehicles licensed and titled for use on public highways.
(5) The sale of fuel used or consumed in the manufacturing of power, heat, light, or
gas to be sold at retail is not taxable.
(6) The sale of fuel used for an exempt agricultural purpose or industrial processing
is exempt from tax.