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Bill > LD1602
ME LD1602
ME LD1602An Act to Remove the Exemption from Sales and Use Tax for Automobiles Purchased for Use as Rentals
summary
Introduced
04/10/2025
04/10/2025
In Committee
04/10/2025
04/10/2025
Crossed Over
Passed
Dead
05/06/2025
05/06/2025
Introduced Session
132nd Legislature
Bill Summary
Under current law, the sale of an automobile to a person in the business of renting automobiles for a period of less than one year is not taxed; instead, the lease of the vehicle to a consumer is taxed at the rate of 10%. This bill requires a person purchasing an automobile for the purpose of renting the automobile for less than one year to pay a sales and use tax of 5.5%. The lease of the vehicle to a consumer continues to be taxed at 10%.
AI Summary
This bill modifies Maine's sales and use tax law by removing the existing tax exemption for automobile sales to rental car businesses. Currently, when a business purchases automobiles specifically for short-term rental (less than one year), those purchases were not subject to sales tax. Under this new legislation, such automobile sales will now be taxed at a rate of 5.5%, while the subsequent lease of those vehicles to consumers will continue to be taxed at 10%. The bill amends the state's tax code by adding a new provision that explicitly requires sales tax to be collected when rental car companies purchase automobiles, their integral parts, or accessories intended for rental within a period of less than one year. This change will apply to sales occurring on or after January 1, 2026, giving businesses time to prepare for the new tax requirement. The modification is designed to close a previous tax exemption and potentially generate additional revenue for the state by taxing automobile sales to rental car businesses.
Committee Categories
Budget and Finance
Sponsors (4)
Last Action
Pursuant to Joint Rule 310.3 Placed in Legislative Files (DEAD) (on 05/06/2025)
bill text
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://legislature.maine.gov/legis/bills/display_ps.asp?LD=1602&snum=132 |
| BillText | https://legislature.maine.gov/legis/bills/getPDF.asp?paper=SP0639&item=1&snum=132 |
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