Sales tax is a tax imposed on the retail sale of goods and services in the state of Maine. The general sales tax rate in Maine is 5.5%. However, there are various exemptions to the sales tax in Maine. Knowing how to calculate sales tax in Maine along with the exemptions can help businesses and individuals properly comply with Maine sales tax laws and avoid overpaying taxes.
This comprehensive guide provides details on calculating, reporting and paying sales tax in Maine. It also covers sales tax exemptions, administration and important dates for filings and payments that both businesses and individuals should know.
Maine Sales Tax Calculator
Using a Maine sales tax calculator can simplify calculating the total sales tax rate quickly in locations that have local option or county sales taxes. Here are some options for quickly calculating Maine sales tax:
- Use an online Maine sales tax calculator that allows you to enter the purchase amount and sales tax location/jurisdiction. It will calculate the total sales tax rate and amount instantly.
- Download a Maine sales tax calculator app on your smartphone, like Sales Tax Calculator or Sales Tax Calculator+. Enter the purchase amount and sales tax jurisdiction.
- Use a Maine sales tax rate lookup tool to find the total tax rate by address/location. Then multiply the taxable purchase by the total tax percentage to calculate sales tax.
- Check Maine sales tax charts that list the combined state and local sales tax rates by location.
Maine Sales Tax Calculator
Maine Sales Tax Calculator
Using this Maine sales tax calculator options can remove the complexity of calculating combined sales tax rates manually.
Local Option Taxes in Maine
Additional 1% local option tax allowed in over 30 counties/cities.
Like Vermont, Maine does not have traditional county government structures. However, some cities and counties can vote to charge an extra 1% local option sales tax in addition to the 5.5% state rate.
Currently over 30 municipalities across Maine take advantage of this, bringing their total sales tax to 6.5%. All other areas remain at 5.5%.
Maine Sales Tax Exemptions
While most retail sales in Maine are subject to sales tax, there are exemptions that exclude certain goods and services from sales and use tax. It is important for both businesses and consumers to understand these Maine sales tax exemptions.
Common Maine Sales Tax Exemptions
Some common exemptions to Maine sales and use tax include:
- Food: Most grocery food is exempt from Maine sales tax. Prepared foods sold by restaurants and bars are taxable.
- Prescription drugs: Prescriptions and over-the-counter medications are exempt.
- Clothing: Clothing items under $175 are exempt from Maine sales tax.
- Gasoline: Gasoline sold for motor vehicles is exempt from sales tax.
- Manufacturing equipment: Machinery and equipment used in manufacturing is exempt.
- School sales: Sales by schools and school organizations are exempt.
- Newspapers & magazines: Newspapers and magazine subscriptions are exempt.
Maine Sales Tax Exemption Certificates
Businesses and non-profit organizations can use exemption certificates to purchase qualifying items tax-exempt. Common exemption certificates in Maine include:
- Resale certificate: Use this if you are purchasing inventory to resell.
- Commercial agricultural certificate: For agricultural products and equipment.
- Commercial fishing certificate: For vessels, equipment and bait.
- Industrial production certificate: For utilities, equipment and supplies.
- Construction contract certificate: For tangible personal property to be physically incorporated into real property.
- Exempt organization certificate: For non-profits, churches, hospitals, etc.
Any valid exemption certificates must be retained as part of the seller’s records per Maine sales tax law. There are strict guidelines on proper use of exemption certificates. Misuse can result in tax, interest and penalties for both buyer and seller per Maine Revised Statutes Title 36, Sec 1760(45).
Sales Tax Return Filing and Payment Requirements
Business registered to collect Maine sales tax must file regular sales and use tax returns to report and pay the tax they collected. Here are some key details on Maine sales tax return filing:
- Monthly filing: Businesses with $3,000+ in monthly state sales tax must file monthly returns.
- Quarterly filing: Businesses with less than $3,000 in monthly state sales tax can file quarterly.
- Due dates: Monthly returns are due by the 15th of the following month. Quarterly returns are due by the last day of the month after the quarter closes.
- Electronic filing: Sales tax returns must be filed electronically through Maine Revenue Services online portal.
- Payment: Payment is due with the return, either via ACH credit or ACH debit. There are electronic payment options during efiling.
Penalties and interest apply for late sales tax return filing and payment. It is crucial for businesses to understand their responsibilities and due dates for Maine sales tax reporting.
Sales Tax Administration in Maine
Sales tax in Maine is administered by Maine Revenue Services. Their website provides complete details on requirements, forms, rates, contacts and more sales tax information:
- Maine sales tax homepage
- Tax registration
- Sales & use tax instructional bulletins
- Online tax filing
- Sales tax forms
- Sales tax rates by location
- Exemption certificates
Key contacts for sales tax questions:
- Email: [email protected]
- Phone: (207) 624-9693
- Maine Revenue Services office locations
Understanding all the requirements, exemptions and details on Maine sales tax reporting ensures businesses remain compliant. Both companies registered to collect sales tax and individuals/consumers can utilize this guide as a helpful resource on Maine sales tax administration.
Conclusion
Maine has a statewide sales tax rate of 5.5%, with additional local option and county taxes in some areas. Knowing how to accurately calculate the total sales tax rate based on location in Maine is important for compliance. There are also numerous exemptions, like food and prescriptions, that remove certain items from sales tax. Businesses must obtain valid exemption certificates from qualified organizations/individuals to sell exempt items tax-free.
Sales tax returns must be filed monthly or quarterly electronically, with payment due with the return. Maine Revenue Services oversees all aspects of sales tax administration. Their website is a comprehensive resource for requirements, forms, contacts and everything related to Maine sales tax.
Understanding how to calculate, report and pay Maine sales tax correctly along with keeping proper records helps avoid tax deficiencies or penalties. With the information provided in this guide, both businesses and consumers in Maine can stay up-to-date and compliant on Maine sales tax laws.
