Maine’s sales tax regulations can be a little difficult to understand. The majority of tangible personal property sold in Maine is subject to a 5.5% sales tax. With a few exceptions, services in Maine are often exempt from the sales tax.
On tangible personal property utilized in the state but bought elsewhere, Maine also levies a use tax. 5.5% is also the use tax rate. This tax is primarily paid by companies that buy goods from out-of-state suppliers, but it may also be imposed on private citizens who shop online or in other states.
A form of service that has grown in popularity recently is known as “Software as a Service” (SaaS). SaaS services are often exempt from sales tax in Maine. However, the sale can be subject to sales tax if the SaaS provider also includes tangible personal property as part of the service, like a CD or printed instructions.
In Maine, it is the seller’s responsibility to gather and send the state’s sales tax. This implies that you must register with the Maine Revenue Services and charge sales tax to your clients if your company sells tangible personal property in Maine. However, you won’t have to pay sales tax on the majority of services if you’re a consumer buying tangible personal property in Maine.
On consumer purchases made outside of Maine, there is no sales tax collected. However, as was already indicated, you can be required to pay use tax if you’re a business buying tangible personal property from an out-of-state vendor. This tax is intended to prevent businesses in Maine from unfairly benefiting from those in the state.
In conclusion, while the majority of tangible personal property sold in Maine is subject to a sales tax, services are typically excluded from this tax. Consumers are not required to pay sales tax on purchases made from out-of-state sellers, but businesses that make purchases from such vendors may be liable to use tax. To maintain compliance with state law, it is crucial for both businesses and consumers to understand Maine’s sales and use tax regulations.