Maine Enacts Economic Nexus Legislation

Effective Date: July 1, 2018

Threshold: Gross revenue exceeds $100,000 or 200 or more separate transactions, 200 transactions threshold removed effective January 1, 2022

Measurement Date: In the previous or current calendar year

Includable Transactions: Gross sales; Marketplace sales excluded from the threshold for individual sellers and don’t include marketplace sales on return if reported by marketplace

When You Need to Register Once You Exceed the Threshold: First day of the first month that begins at least thirty days after the seller has exceeded the threshold.

Effective October 1, 2017, Maine’s legislature has enacted legislation requiring remote sellers to collect and remit sales tax on sales of tangible personal property, products transferred electronically or services that are delivered into Maine, if:

• The seller’s gross revenue from such sales into Maine in the previous calendar year or current calendar year exceeds $100,000; or
• The seller made such sales into Maine in at least 200 separate transactions in the previous calendar year or the current calendar year (removed effective January 1, 2022).

The state may bring a declaratory judgment action against remote sellers to establish the federal and state legal validity of the tax collection obligation. The obligation to collect and remit the sales and use tax required by the legislation may not be applied retroactively. If an injunction against the legislation is lifted, the obligation to collect sales and use tax applies from that date forward for persons covered by the injunction. The legislature overrode the Governor’s veto of the legislation. We expect litigation challenging the law to be filed as has happened in other states. (L.D. 1405 (S.P. 483), Laws 2017)

UPDATE: After reviewing the South Dakota v. Wayfair decision, Maine Revenue Services issued guidance for remote sellers on August 8, 2018. Maine will enforce its economic nexus statute for sales occurring on or after July 1, 2018, the first monthly filing period after the date of the Wayfair decision. For more information, you can read the full notice from Maine Revenue Services or visit their remote sellers page.

UPDATE: The Maine Governor signed a bill on June 11, 2021 that will remove the transaction count threshold from the state’s economic nexus rules for remote sellers effective January 1, 2022. Learn more.