Maine Revenue Service announces two recent law changes

 

Sales Tax Rate Changes Effective October 1, 2013

Sales tax rate increases recently passed by the legislature take effect on October 1, 2013.Sales tax rates  have been temporarily increased from October 1, 2013 through June 30, 2015.  The general sales tax rate of 5% will increase to 5.5%.  The 7% tax rate on the rental of living quarters, sales of prepared food, and sales of liquor sold on premises will  increase to 8%.   The 10% tax rate on short term rentals of automobiles remains unchanged.  Click here for new tax rate charts.  

New refund/exemption provision Effective July 1, 2013

A new refund/exemption provision affecting businesses engaged in commercial wood harvesting, commercial nurseries and commercial greenhouses as well as retailers selling to these businesses takes effect July 1, 2013 for qualifying purchases on or after that date.

Sales tax law was expanded to provide a refund/exemption provision for sales of electricity and depreciable machinery/equipment to businesses engaged in commercial wood harvesting, and to commercial nurseries and commercial greenhouses.

The definition of “commercial agricultural production” was expanded to now include the commercial production of plants and trees.

A definition of “commercial wood harvesting” was added and is defined to mean the commercial severance and yarding of trees for sale or for processing into logs, pulpwood, bolt wood, wood chips, stud wood, poles, pilings, biomass or fuel wood or other products commonly known as forest products.

Persons engaged in these types of businesses must apply to Maine Revenue Services for an exemption certificate.  The application can be found at http://www.maine.gov/revenue/forms/sales/salesforms.htm.

Nurseries and greenhouses should refer to instructional Bulletin 45 “Commercial Agriculture”   and wood harvesters should refer to Instructional Bulletin 58 “Commercial Wood Harvesting” for additional information.  Both bulletins can be viewed at http://www.maine.gov/revenue/salesuse/salestax/bulletinssales.htm.   

Retailers making tax exempt sales to those engaged in these commercial activities must obtain a copy of the purchasers’ exemption certificate and an exemption affidavit.  Affidavits can be found at http://www.maine.gov/revenue/forms/sales/salesforms.htm.  The sales invoice must be clearly marked as tax exempt.

For additional tax assistance, feel free to call our staff at (207) 624-9693.

Peter B. Beaulieu, Director
Maine Revenue Services
Sales, Fuel and Special Tax Division