United States

Maine: Legislature Overrides Governor’s Veto to Enact Economic Nexus Sales and Use Tax Statute

Jun 26, 2017
From KPMG TaxWatch

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On June 21, 2017, the Maine legislature voted to override Governor Paul LePage’s veto and enact Senate Paper 483. As such, effective October 1, 2017, remote sellers with no physical presence in Maine are required to collect and remit sales tax if they meet one of the following requirements for the current or preceding calendar year: (1) having gross revenues from the sale of tangible personal property, products transferred electronically, or taxable services into Maine that exceed $100,000; or (2) making sales of tangible personal property, products transferred electronically, or taxable services for delivery into Maine in at least 200 separate transactions.

Similar to the economic nexus legislation passed in South Dakota in 2016, Senate Paper 483 includes provisions to address and expedite potential litigation challenging the constitutionality of the economic nexus standard. Specifically, the Maine Department of Revenue Services may bring an action in district court for declaratory judgment against any retailer it believes is required to collect tax under the economic nexus standard to establish that the collection obligation is applicable and valid under state and federal law. If the court determines that a question has been presented regarding the constitutionality of the law, the court is directed to enjoin the State from enforcing the standard against other sellers while the action is pending unless a seller affirmatively consents or otherwise voluntarily collects the tax. If an injunction is imposed, the Department may only require collection and remittance prospectively from the date the injunction is lifted. The court is directed to act on the action “as expeditiously as possible,” and appeals must be made directly to the Maine Supreme Judicial Court. For further information on Maine Senate Paper 483 (Chapter 245, 2017 Legislature), please contact Joe Senier at 617-988-1025.


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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.

The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.