Sales Tax Updates in Maine

Tax Professionals' Resource
February 10, 2013 — 1,540 views  
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The state of Maine applies a sales tax of generally 5% on the gross receipts of tangible personal property and taxable services sold in the state. It should be noted that different rates are applied to some goods and services in Maine. Here is a breakdown:

  • The sales tax for car rentals of less than 12 months is 12.5%
  • The sales tax of food prepared by a retailer is 8.5%
  • The sales tax for food and alcoholic beverages at food establishments is 8.5%
  • The sales tax for room rentals is 8.5%

The state of Maine grants a credit for any sales or use tax paid to an out-of-state vendor for property or services used within state lines. This credit can never exceed the Maine tax amount.

Retailers doing business in Maine can obtain a sales tax permit through the Sales Tax Division of the State Tax Assessor No fees are applied for this permit. Any business selling property, goods, and services with a physical presence in Maine has a sales tax liability to the state. A physical presence can be defined as having a retail, warehouse, or office location, one or more employees, or frequent delivery trucks delivery within state lines.

The state of Maine mandates that the sales tax is shifted from the retailer to the consumer. It is illegal for this tax to be absorbed by Maine retailers. It is in violation of the law for sellers to market or promote that they will absorb the sales tax at the time of transaction. It is a legal requirement that the tax be tacked onto the sales price.

The state of Maine has granted sales tax exemptions to particular items, like certain prescription medications. Purchases made with the intent to resale are not subject to sales tax. A resale certificate must be given to the seller and invoices must be clearly marked "Main Sales Tax Exempt, for Resale" to satisfy the exempt purchase requirement.

The resale exemption certificate must clearly show the buyer's name, address, and type of business, the registration certificate number, the seller's name, a description of the property being sold, and the date the resale certificate is completed.

Maine imposes a use tax on any out-of-state purchase that is either used or stored within state lines. In this case it is the consumer that is liable for paying the tax.

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