An Act To Provide for Exemption from the Sales Tax for Basic Needs Products and Offset the Loss of Revenue
Maine Legislature, Session 130, LD 1335
Committee: Taxation
Sponsors: TEPLER, BREEN, COLLINGS, GRAMLICH, MATLACK, SACHS, TERRY, CHIPMAN
Amends: 36 MRSA §1752

Legislative Document
No. 1335
H.P. 986
House of Representatives, March 30, 2021
An Act To Provide for Exemption from the Sales Tax for Basic 
Needs Products and Offset the Loss of Revenue
Reference to the Committee on Taxation suggested and ordered printed.
ROBERT B. HUNT
Clerk
Presented by Representative TEPLER of Topsham.
Cosponsored by Senator BREEN of Cumberland and
Representatives: COLLINGS of Portland, GRAMLICH of Old Orchard Beach, MATLACK of 
St. George, SACHS of Freeport, TERRY of Gorham, Senator: CHIPMAN of Cumberland.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §1752, sub-§3-B, as amended by PL 2019, c. 231, Pt. A, §§5 
and 6, is further amended to read:
3-B.  Grocery staples.  "Grocery staples" means food products ordinarily consumed 
for human nourishment and certain basic needs products as specified in this subsection.
"Grocery staples" does not include:
A.  Spirituous, malt or vinous liquors;
B.  Medicines, tonics, vitamins and preparations sold as dietary supplements or 
adjuncts, except when sold on the prescription of a physician;
C.  Water, including mineral bottled and carbonated waters and ice;
D.  Dietary substitutes;
E.  Candy and confections, including but not limited to confectionery spreads. As used 
in this paragraph, "candy" means a preparation of sugar, honey or other natural or 
artificial sweeteners in combination with chocolate, fruits, nuts or other ingredients or 
flavorings in the form of bars, drops or pieces;
F.  Prepared food;
G.  The following food and drinks ordinarily sold for consumption without further 
preparation:
(1)  Soft drinks and powdered and liquid drink mixes except powdered milk, infant 
formula, coffee and tea;
(2)  Sandwiches and salads;
(3)  Supplemental meal items such as corn chips, potato chips, crisped vegetable 
or fruit chips, potato sticks, pork rinds, pretzels, crackers, popped popcorn, cheese 
sticks, cheese puffs and dips;
(4)  Fruit bars, granola bars, trail mix, breakfast bars, rice cakes, popcorn cakes, 
bread sticks and dried sugared fruit;
(5)  Nuts and seeds that have been processed or treated by salting, spicing, 
smoking, roasting or other means;
(6)  Desserts and bakery items, including but not limited to doughnuts, cookies, 
muffins, dessert breads, pastries, croissants, cakes, pies, ice cream cones, ice 
cream, ice milk, frozen confections, frozen yogurt, sherbet, ready-to-eat pudding, 
gelatins and dessert sauces; and
(7)  Meat sticks, meat jerky and meat bars.
As used in this paragraph, "without further preparation" does not include combining an 
item with a liquid or toasting, microwaving or otherwise heating or thawing a product 
for palatability rather than for the purpose of cooking the product; and
H.  Notwithstanding any other provision of law to the contrary, any food product 
containing any amount of marijuana or marijuana product.
"Grocery staples" includes bread and bread products, jam, jelly, pickles, honey, 
condiments, maple syrup, spaghetti sauce or, salad dressing, toilet paper, menstrual 
products or diapers when packaged as a separate item for retail sale.
Sec. 2.  Study of sales tax exemption for basic needs products. The Department 
of Administrative and Financial Services, Maine Revenue Services shall study the potential 
tax revenue that would be lost by classifying toilet paper, menstrual products and diapers 
as grocery staples, as defined in the Maine Revised Statutes, Title 36, section 1752, 
subsection 3-B and exempted from sales tax under Title 36, section 1760, subsection 3.
Sec. 3.  Offsetting any loss of revenue.  The Department of Administrative and 
Financial Services, Maine Revenue Services shall study available options to offset any loss 
of revenue that may result from the classification of toilet paper, menstrual products and 
diapers as grocery staples, including placing taxes on imported luxury foods, such as 
cheese, jam, jelly or flavored coffee creamer.
Sec. 4.  Reporting.  No later than December 1, 2021, the Department of 
Administrative and Financial Services, Maine Revenue Services shall submit a report to 
the Joint Standing Committee on Taxation containing a summary of its findings under 
sections 2 and 3 and making recommendations, including any suggested legislation, to the 
committee.  The committee may submit a bill based on the report to the Second Regular 
Session of the 130th Legislature.
Sec. 5.  Effective date. That section of this Act that amends the Maine Revised 
Statutes, Title 36, section 1752, subsection 3-B takes effect August 1, 2022.
SUMMARY
This bill amends the definition of "grocery staples" to include toilet paper, diapers or 
menstrual products, effective August 1, 2022.  The bill requires the Department of 
Administrative and Financial Services, Maine Revenue Services to study any sales tax 
revenue lost by classifying toilet paper, menstrual products and diapers as grocery staples, 
which are exempt from sales tax.  Maine Revenue Services is required to study available 
options to offset any lost sales tax revenue, including taxation of imported luxury foods.  
Maine Revenue Services is directed to submit a report to the Joint Standing Committee on 
Taxation by December 1, 2021, and the committee is authorized to submit a bill based on 
the report to the Second Regular Session of the 130th Legislature.