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On February 12, 2019, the Michigan Court of Appeals upheld the imposition of use tax on phones that were given away for no charge by a company in conjunction with its sale of mobile phone service contracts. The company sold service contracts for a single mobile phone service provider and also purchased phones from the provider. The company did not remit sales or use tax on the phones that it purchased from the provider “for purposes of resale.” On audit, the company was assessed use tax based on the price it paid the provider for the phones. The company argued that its purchase price for the phones was zero, asserting that it had been reimbursed by the provider for the cost of phones. The Court, however, determined that the company was not reimbursed by the provider but instead was paid a commission by the provider for the sale of service contracts. Accordingly, the Court upheld the determination that the company owed use tax on its disposition of the phones. Emery Electronics, Inc. v. Dept. of Treasury, Dkt. No. 342250 (Mich. Ct. App. Feb. 12, 2019) (unpublished).