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132nd MAINE LEGISLATURE
FIRST SPECIAL SESSION-2025
Legislative Document No. 1602S.P. 639 In Senate, April 10, 2025
An Act to Remove the Exemption from Sales and Use Tax for
Automobiles Purchased for Use as Rentals
Reference to the Committee on Taxation suggested and ordered printed.
DAREK M. GRANT
Secretary of the Senate
Presented by Senator TIPPING of Penobscot.
Cosponsored by Senator: TALBOT ROSS of Cumberland, Representatives: MATLACK of St.
George, RANA of Bangor. Page 1 - 132LR2357(01)
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2 as amended by PL 2007, c. 437, §10, is
3 further amended by amending subparagraph (3) to read:
4 (3) A sale in the ordinary course of business by a retailer to a purchaser who is not
5 engaged in selling that kind of tangible personal property or taxable service in the
6 ordinary course of repeated and successive transactions of like character; and
7 as amended by PL 2007, c. 437, §10, is
8 further amended by amending subparagraph (4) to read:
9 (4) The sale or liquidation of a business or the sale of substantially all of the assets
10 of a business, to the extent that the seller purchased the assets of the business for
11 resale, lease or rental in the ordinary course of business, except when:
12 (a) The sale is to an affiliated entity and the transferee, or ultimate transferee
13 in a series of transactions among affiliated entities, purchases the assets for
14 resale, lease or rental in the ordinary course of business; or
15 (b) The sale is to a person that purchases the assets for resale, lease or rental
16 in the ordinary course of business or that purchases the assets for transfer to an
17 affiliate, directly or through a series of transactions among affiliated entities,
18 for resale, lease or rental by the affiliate in the ordinary course of business.
19 For purposes of this subparagraph, "affiliate" or "affiliated" includes both direct
20 and indirect affiliates. ; and
21 as amended by PL 2007, c. 437, §10, is
22 further amended by enacting a new subparagraph (5) to read:
23 (5) The sale, to a person engaged in the business of renting automobiles, of
24 automobiles, integral parts of automobiles or accessories to automobiles for rental
25 or for use in an automobile rented for a period of less than one year.
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28 Under current law, the sale of an automobile to a person in the business of renting
29 automobiles for a period of less than one year is not taxed; instead, the lease of the vehicle
30 to a consumer is taxed at the rate of 10%.
31 This bill requires a person purchasing an automobile for the purpose of renting the
32 automobile for less than one year to pay a sales and use tax of 5.5%. The lease of the
33 vehicle to a consumer continues to be taxed at 10%.
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