An Act to Eliminate the Personal Property Tax
Maine Legislature, Session 131, LD 1743
Committee: Taxation
Sponsors: ANDREWS
Amends: 10 MRSA §1050, 10 MRSA §1070, 29-A MRSA §409, 30-A MRSA §5721-A, 36 MRSA §191, 36 MRSA §199-B, 36 MRSA §305, 36 MRSA §328, 36 MRSA §384, 36 MRSA §457, 36 MRSA §501, 36 MRSA §502, 36 MRSA §578, 36 MRSA §652, 36 MRSA §655, 36 MRSA §708, 36 MRSA §760-A, 36 MRSA §841, 36 MRSA §1485, 36 MRSA §1486, 36 MRSA §1602, 36 MRSA §1606, 38 MRSA §2219

Legislative Document
No. 1743
H.P. 1122
House of Representatives, April 20, 2023
An Act to Eliminate the Personal Property Tax
Reference to the Committee on Taxation suggested and ordered printed.
ROBERT B. HUNT
Clerk
Presented by Representative ANDREWS of Paris.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  10 MRSA §1050, as enacted by PL 1981, c. 476, §2, is amended to read:
§1050.  Leasehold or other interests of lessee taxable
The interest of the user of any project is subject to taxation in the manner provided for 
similar interest in Title 36, section 551, subject to Title 36, sections 655 and section 656.
Sec. 2.  10 MRSA §1070, as amended by PL 1983, c. 480, Pt. B, §14, is further 
amended to read:
§1070.  Leasehold or other interests of lessee taxable
The interest of the lessee of any project is subject to taxation in the manner provided 
for fee interests in real estate and personal property in Title 36, sections section 551 and 
602, subject to the provisions of Title 36, sections 655 and section 656.
Sec. 3.  29-A MRSA §409, sub-§5, as amended by PL 2017, c. 67, §2, is further 
amended to read:
5.  Other taxes.  A motor vehicle, mobile home or camp trailer may not be registered 
until the excise tax or personal property tax or real estate tax has been paid in accordance 
with Title 36, sections 551, 602, 1482 and 1484.  The Secretary of State may provide 
municipal excise tax collectors with a standard vehicle registration form for the collection 
of excise tax.
Sec. 4.  30-A MRSA §5721-A, sub-§1, ¶C, as amended by PL 2009, c. 545, §1, is 
further amended to read:
C.  "Property growth factor" means the percentage equivalent to a fraction established 
by a municipality, whose denominator is the total valuation of the municipality, and 
whose numerator is the amount of increase in the assessed valuation of any real or 
personal property in the municipality that became subject to taxation for the first time, 
or taxed as a separate parcel for the first time for the most recent property tax year for 
which information is available, or that has had an increase in its assessed valuation over 
the prior year's valuation as a result of improvements to or expansion of the property.  
A municipality identified as having a personal property factor that exceeds 5%, as 
determined pursuant to Title 36, section 694, subsection 2, paragraph B, may calculate 
its property growth factor by including in the numerator and the denominator the value 
of personal and otherwise qualifying property introduced into the municipality 
notwithstanding the exempt status of that property pursuant to Title 36, chapter 105, 
subchapter 4‑C.
Sec. 5.  36 MRSA §191, sub-§2, ¶AA, as amended by PL 2013, c. 67, §1, is further 
amended to read:
AA.  The disclosure by employees of the bureau to designated representatives of the 
Finance Authority of Maine necessary for the administration of section 6656, 
subsection 3 and section 6758, subsection 4 and of information required to ensure that 
recipients of certain benefits under Title 20‑A, chapter 417‑E are eligible to receive 
such benefits;
Sec. 6.  36 MRSA §199-B, sub-§1, ¶D, as amended by PL 2017, c. 211, Pt. E, §4, 
is further amended to read:
D.  Any issues regarding tax expenditures that need to be considered by the Legislature; 
and
Sec. 7.  36 MRSA §199-B, sub-§1, ¶E, as amended by PL 2017, c. 211, Pt. E, §4, 
is further amended to read:
E.  Any recommendation regarding the amendment, repeal or replacement of the tax 
expenditure; and.
Sec. 8.  36 MRSA §199-B, sub-§1, ¶F, as enacted by PL 2017, c. 211, Pt. E, §4, is 
repealed.
Sec. 9.  36 MRSA §305, sub-§1, as amended by PL 2017, c. 170, Pt. B, §1, is further 
amended to read:
1.  Just value.  Certify to the Secretary of State before the first day of February each 
year the equalized just value of all real and personal property in each municipality and 
unorganized place that is subject to taxation under the laws of this State.  The equalized 
just value excludes the following:
A.  That percentage of captured assessed value located within a tax increment financing 
district that is used to finance that district's development plan;
B.  The captured assessed value located within a municipal affordable housing 
development district; and
C.  The amount by which the current assessed value of commercial and industrial 
property within a municipal incentive development zone exceeds the assessed value of 
that property as of the date the development zone is approved by the Commissioner of 
Economic and Community Development.  This excess value as determined under Title 
30‑A, chapter 208‑A and referred to in this subsection as the "sheltered value" is limited 
to the amount invested by a municipality in infrastructure improvements pursuant to 
the infrastructure improvement plan adopted under Title 30‑A, chapter 208‑A.
The equalized just value must be uniformly assessed in each municipality and unorganized 
place and be based on 100% of the current market value. The bureau's valuation documents 
must separately show for each municipality and unorganized place the actual or estimated 
value of all real estate that is exempt from property taxation by law or is the captured value 
within a tax increment financing district that is used to finance that district's development 
plan, as reported on the municipal valuation return filed pursuant to section 383, or that is 
the sheltered value of a municipal incentive development zone;
Sec. 10.  36 MRSA §328, sub-§7, as enacted by PL 1975, c. 545, §13, is amended 
to read:
7.  Physical inspection and inventory.  Physical inspection and inventory of each real 
property parcel and personal property account will take place at least every 4 years rather 
than every 3 years;
Sec. 11.  36 MRSA §384, as amended by PL 2019, c. 501, §17, is further amended 
to read:
§384.  Investigation of valuation; actions and prosecutions; reassessment orders; 
appeals
The State Tax Assessor shall, at the State Tax Assessor's own instance or on complaint 
from another person, diligently investigate all cases of concealment of property from 
taxation, of undervaluation, of overvaluation, and of failure to assess property liable to 
taxation. The State Tax Assessor shall bring to the attention of assessors all such cases in 
their respective jurisdictions. The State Tax Assessor shall direct proceedings, actions and 
prosecutions to be instituted to enforce all laws relating to the assessment and taxation of 
property and to the liability of individuals, public officers and officers and agents of 
corporations for failure or negligence to comply with the laws governing the assessment or 
taxation of property, and the Attorney General and district attorneys, upon the written 
request of the State Tax Assessor, shall institute such legal proceedings as may be necessary 
to carry out this Title. The State Tax Assessor may order the reassessment of any or all real 
and personal property, or either, in any jurisdiction where in the State Tax Assessor's 
judgment such reassessment is advisable or necessary to the end that all classes of property 
in such jurisdiction are assessed in compliance with the law. Neglect or failure to comply 
with such orders on the part of any assessor or other official is deemed willful neglect of 
duty and the assessor or other official is subject to the penalties provided by law in such 
cases. If a satisfactory reassessment is not made by the assessors, then the State Tax 
Assessor may employ assistance from within or without the jurisdiction where such 
reassessment is to be made, and said that jurisdiction bears all necessary expense incurred. 
Any person aggrieved because of such reassessment has the same right of petition and 
appeal as from the original assessment. The State may intervene in any action resulting 
from an order of the State Tax Assessor pursuant to this section.
Sec. 12.  36 MRSA §457, sub-§7, as amended by PL 2011, c. 430, §1, is further 
amended to read:
7.  Collection.  Taxes assessed under this section by the State Tax Assessor must be 
enforced as generally provided by this Title.  Taxes assessed under this section by 
municipal assessors must be enforced in the same way as locally assessed personal property 
taxes.
Sec. 13.  36 MRSA §501, sub-§1 is amended to read:
1.  Estates.  "Estates" shall be construed to mean both means real estate and personal 
property.
Sec. 14.  36 MRSA §501, sub-§7 is amended to read:
7.  Property.  "Property" shall be construed to mean both means real estate and 
personal property.
Sec. 15.  36 MRSA §502, as amended by PL 1997, c. 216, §1, is further amended to 
read:
§502.  Property taxable; tax year
All real estate within the State, all personal property of residents of the State and all 
personal property within the State of persons not residents of the State is subject to taxation 
on the first day of each April as provided; and the status of all taxpayers and of such taxable 
property must be fixed as of that date.  Upon receipt of a declaration of value under section 
4641‑D reflecting a change of ownership in real property, the assessor may change the 
records of the municipality to reflect the identity of the new owner, if notice of tax liabilities 
is sent both to the new owner and to the owner of record as of the April 1st when the liability 
accrued.  The taxable year is from April 1st to April 1st. Notwithstanding this section, 
proration of taxes must be over the period specified in section 558.
Sec. 16.  36 MRSA §578, sub-§1, ¶C, as amended by PL 2021, c. 630, Pt. C, §3, 
is further amended by amending subparagraph (1) to read:
(1)  "Property tax burden" means the total real and personal property taxes assessed 
in the most recently completed municipal fiscal year, except the taxes assessed on 
captured value within a tax increment financing district, divided by the latest state 
valuation certified to the Secretary of State.
Sec. 17.  36 MRSA c. 105, sub-c. 3, as amended, is repealed.
Sec. 18.  36 MRSA §652, sub-§1, ¶A, as amended by PL 2021, c. 630, Pt. B, §2, 
is further amended to read:
A.  The real estate and personal property owned and occupied or used solely for their 
own purposes by incorporated benevolent and charitable institutions are is exempt from 
taxation.  Such an institution may not be deprived of the right of exemption by reason 
of the source from which its funds are derived or by reason of limitation in the classes 
of persons for whose benefit the funds are applied.
For the purposes of this paragraph, "benevolent and charitable institutions" includes, 
but is not limited to, nonprofit nursing homes licensed by the Department of Health 
and Human Services pursuant to Title 22, chapter 405, nonprofit residential care 
facilities licensed by the Department of Health and Human Services pursuant to Title 
22, chapter 1663, nonprofit community mental health service facilities licensed by the 
Commissioner of Health and Human Services in accordance with rules adopted 
pursuant to Title 34‑B, chapter 3 and nonprofit child care centers.  For the purposes of 
this paragraph, "nonprofit" refers to an institution that has been determined by the 
United States Internal Revenue Service to be exempt from taxation under Section 
501(c)(3) of the Code.
Sec. 19.  36 MRSA §652, sub-§1, ¶B, as amended by PL 2007, c. 627, §20, is 
further amended to read:
B.  The real estate and personal property owned and occupied or used solely for their 
own purposes by literary and scientific institutions are is exempt from taxation. If any 
building or part of a building is used primarily for employee housing, that building, or 
that part of the building used for employee housing, is not exempt from taxation.
Sec. 20.  36 MRSA §652, sub-§1, ¶C, as amended by PL 2019, c. 501, §19, is 
further amended by amending subparagraph (6) to read:
(6)  An exemption allowed under paragraph A or B for real or personal property 
owned and occupied or used to provide federally subsidized residential rental 
housing is limited as follows:  Federally subsidized residential rental housing 
placed in service prior to September 1, 1993 by other than a nonprofit housing 
corporation that is acquired on or after September 1, 1993 by a nonprofit housing 
corporation and the operation of which is not an unrelated trade or business to that 
nonprofit housing corporation is eligible for an exemption limited to 50% of the 
municipal assessed value of that property.
An exemption granted under this subparagraph must be revoked for any year in 
which the owner of the property is no longer a nonprofit housing corporation or 
the operation of the residential rental housing is an unrelated trade or business to 
that nonprofit housing corporation.
(a)  For the purposes of this subparagraph, the following terms have the 
following meanings.
(i)  "Federally subsidized residential rental housing"  means residential 
rental housing that is subsidized through project-based rental assistance, 
operating assistance or interest rate subsidies paid or provided by or on 
behalf of an agency or department of the Federal Government.
(ii)  "Nonprofit housing corporation" means a nonprofit corporation 
organized in the State that is exempt from tax under Section 501(c)(3) of 
the Code and has among its corporate purposes the provision of services 
to people of low income or the construction, rehabilitation, ownership or 
operation of housing.
(iii)  "Residential rental housing" means one or more buildings, together 
with any facilities functionally related and subordinate to the building or 
buildings, located on one parcel of land and held in common ownership 
prior to the conversion to nonprofit status and containing 9 or more 
similarly constructed residential units offered for rental to the general 
public for use on other than a transient basis, each of which contains 
separate and complete facilities for living, sleeping, eating, cooking and 
sanitation.
(iv)  "Unrelated trade or business" means any trade or business whose 
conduct is not substantially related to the exercise or performance by a 
nonprofit corporation of the purposes or functions constituting the basis 
for exemption under Section 501(c)(3) of the Code.
(b)  Eligibility of the following property for exemption is not affected by the 
provisions of this subparagraph:
(i)  Property used as a nonprofit nursing home, residential care facility 
licensed by the Department of Health and Human Services pursuant to 
Title 22, chapter 1663 or a community living arrangement as defined in 
Title 30‑A, section 4357‑A or any property owned by a nonprofit 
organization licensed or funded by the Department of Health and Human 
Services to provide services to or for the benefit of persons with mental 
illness or intellectual disabilities;
(ii)  Property used for student housing;
(iii)  Property used for parsonages;
(iv)  Property that was owned and occupied or used to provide residential 
rental housing that qualified for exemption under paragraph A or B prior 
to September 1, 1993; or
(v)  Property exempt from taxation under other provisions of law; and
Sec. 21.  36 MRSA §652, sub-§1, ¶C, as amended by PL 2019, c. 501, §19, is 
further amended by amending subparagraph (7) to read:
(7)  In addition to the requirements of subparagraphs (1) to (4), an exemption is not 
allowed under paragraph A or B for real or personal property owned and occupied 
or used to provide residential rental housing that is transferred or placed in service 
on or after September 1, 1993, unless the property is owned by a nonprofit housing 
corporation and the operation of the residential rental housing is not an unrelated 
trade or business to the nonprofit housing corporation.
For the purposes of this subparagraph, the following terms have the following 
meanings.
(a)  "Nonprofit housing corporation" means a nonprofit corporation organized 
in the State that is exempt from tax under Section 501(c)(3) of the Code and 
has among its corporate purposes the provision of services to people of low 
income or the construction, rehabilitation, ownership or operation of housing.
(b)  "Residential rental housing" means one or more buildings, together with 
any facilities functionally related and subordinate to the building or buildings, 
containing one or more similarly constructed residential units offered for rental 
to the general public for use on other than a transient basis, each of which 
contains separate and complete facilities for living, sleeping, eating, cooking 
and sanitation.
(c)  "Unrelated trade or business" means any trade or business whose conduct 
is not substantially related to the exercise or performance by a nonprofit 
organization of the purposes constituting the basis for exemption under Section 
501(c)(3) of the Code.
Sec. 22.  36 MRSA §652, sub-§1, ¶E, as amended by PL 2007, c. 627, §20, is 
further amended to read:
E.  The real estate and personal property owned, occupied and used for their own 
purposes by posts of the American Legion, Veterans of Foreign Wars, American 
Veterans, Sons of Union Veterans of the Civil War, Disabled American Veterans and 
Navy Clubs of the U.S.A. that are is used solely by those organizations for meetings, 
ceremonials or instruction or to further the charitable activities of the organization, 
including all facilities that are appurtenant to that property and used in connection with 
those purposes, are is exempt from taxation.  If an organization is not the sole occupant 
of the property, the exemption granted under this paragraph applies only to that portion 
of the property owned, occupied and used by the organization for its purposes.
Further conditions to the right of exemption are that:
(1)  A director, trustee, officer or employee of any organization claiming exemption 
may not receive directly or indirectly any pecuniary profit from the operation of 
that organization, except as reasonable compensation for services in effecting its 
purposes or as a proper beneficiary of its purposes;
(2)  All profits derived from the operation of the organization and the proceeds 
from the sale of its property must be devoted exclusively to the purposes for which 
it is organized; and
(3)  The institution, organization or corporation claiming exemption under this 
paragraph must file with the assessors upon their request a report for its preceding 
fiscal year in such detail as the assessors may reasonably require.
Sec. 23.  36 MRSA §652, sub-§1, ¶F, as amended by PL 2021, c. 410, §1, is further 
amended to read:
F.  The real estate and personal property owned and occupied or used solely for their 
own purposes by central labor councils, chambers of commerce or boards of trade in 
this State are is exempt from taxation.  For the purposes of this paragraph, "central 
labor council" means an association or network of labor unions designed to promote 
and protect the interests of their members.
Further conditions to the right of exemption are that:
(1)  A director, trustee, officer or employee of any organization claiming exemption 
may not receive directly or indirectly any pecuniary profit from the operation of 
that organization, except as reasonable compensation for services in effecting its 
purposes or as a proper beneficiary of its purposes;
(2)  All profits derived from the operation of the organization and the proceeds 
from the sale of its property must be devoted exclusively to the purposes for which 
it is organized; and
(3)  The institution, organization or corporation claiming exemption under this 
paragraph must file with the assessors upon their request a report for its preceding 
fiscal year in such detail as the assessors may reasonably require.
Sec. 24.  36 MRSA §652, sub-§1, ¶G, as amended by PL 2007, c. 627, §20, is 
further amended to read:
G.  Houses of religious worship, including vestries, and the pews and furniture within 
them; tombs and rights of burial; and property owned and used by a religious society 
as a parsonage up to the value of $20,000, and personal property not exceeding $6,000 
in value are exempt from taxation, except that any portion of a parsonage that is rented 
is subject to taxation. For purposes of this paragraph, "parsonage" means the principal 
residence provided by a religious society for its cleric whether or not the principal 
residence is located within the same municipality as the house of religious worship 
where the cleric regularly conducts religious services.
Sec. 25.  36 MRSA §652, sub-§1, ¶H, as amended by PL 2007, c. 627, §20, is 
further amended to read:
H.  Real estate and personal property owned by or held in trust for fraternal 
organizations, except college fraternities, operating under the lodge system that are is 
used solely by those fraternal organizations for meetings, ceremonials or religious or 
moral instruction, including all facilities that are appurtenant to that property and used 
in connection with those purposes are, is exempt from taxation. If a building is used in 
part for those purposes and in part for any other purpose, only the part used for those 
purposes is exempt.
Further conditions to the right of exemption under this paragraph are that:
(1)  A director, trustee, officer or employee of any organization claiming exemption 
may not receive directly or indirectly any pecuniary profit from the operation of 
that organization, except as reasonable compensation for services in effecting its 
purposes or as a proper beneficiary of its purposes;
(2)  All profits derived from the operation of the organization and the proceeds 
from the sale of its property must be devoted exclusively to the purposes for which 
it is organized; and
(3)  The institution, organization or corporation claiming exemption under this 
paragraph must file with the assessors upon their request a report for its preceding 
fiscal year in such detail as the assessors may reasonably require.
Sec. 26.  36 MRSA §652, sub-§1, ¶J, as amended by PL 2007, c. 627, §20, is 
further amended to read:
J.  The real and personal property owned by one or more of the organizations in 
paragraphs A and B and E to H and occupied or used solely for their own purposes by 
one or more other such organizations are is exempt from taxation.
Sec. 27.  36 MRSA §652, sub-§1, ¶K, as amended by PL 2009, c. 425, §1, is further 
amended to read:
K.  Except as otherwise provided in this subsection, the real and personal property 
leased by and occupied or used solely for its own purposes by an incorporated 
benevolent and charitable organization that is exempt from taxation under section 501 
of the Code and the primary purpose of which is the operation of a hospital licensed by 
the Department of Health and Human Services, a health maintenance organization or 
a blood bank are is exempt from taxation. For property tax years beginning on or after 
April 1, 2012, the exemption provided by this paragraph does not include real property.
Sec. 28.  36 MRSA §655, as amended by PL 2021, c. 181, Pt. C, §2, is repealed.
Sec. 29.  36 MRSA c. 105, sub-c. 4-C, as amended, is repealed.
Sec. 30.  36 MRSA §708, as amended by PL 1973, c. 620, §17, is further amended 
to read:
§708.  Assessors to value real estate and personal property
The assessors and the chief assessor of a primary assessing area shall ascertain as nearly 
as may be the nature, amount and value as of the first day of each April of the real estate 
and personal property subject to be taxed, and shall estimate and record separately the land 
value, exclusive of buildings, of each parcel of real estate.
Sec. 31.  36 MRSA §760-A, as enacted by PL 1991, c. 231, is repealed.
Sec. 32.  36 MRSA §841, sub-§3, as repealed and replaced by PL 1979, c. 73, is 
amended to read:
3.  Inability to pay after 2 years.  If after 2 years from the date of assessment a 
collector is satisfied that a tax upon real or personal property committed to him the collector 
for collection cannot be collected by reason of the death, absence, poverty, insolvency, 
bankruptcy or other inability of the person assessed to pay, he the collector shall notify the 
municipal officers thereof in writing, under oath, stating the reason why that tax cannot be 
collected. The municipal officers, after due inquiry, may abate that tax or any part thereof.
Sec. 33.  36 MRSA c. 107, sub-c. 3, as amended, is repealed.
Sec. 34.  36 MRSA §1485 is repealed.
Sec. 35.  36 MRSA §1486, as amended by PL 2011, c. 610, Pt. A, §9, is further 
amended to read:
§1486.  Tax paid before registration
No A vehicle may not be registered under Title 29‑A until the excise tax or personal 
property tax or real estate tax has been paid in accordance with sections 1482 and 1484.
1.  Exempt status.  Where When a personal property or real estate tax is to be paid as 
a prerequisite to registration, the exempt status of the vehicle shall must be determined by 
section 1483.
Sec. 36.  36 MRSA §1602, sub-§1, as enacted by PL 1977, c. 698, §8, is amended 
to read:
1.  Annual levy of tax.  A tax, to be known as the Unorganized Territory Educational 
and Services Tax, shall must be levied each year upon all nonexempt real and personal 
property located in the Unorganized Territory Tax District on April 1st of each year. The 
State Tax Assessor shall fix the status of all taxpayers and of all such property as of that 
date.
Sec. 37.  36 MRSA §1606, sub-§1, as enacted by PL 2007, c. 627, §35, is amended 
to read:
1.  Credit and appropriation of special funds or taxes for political subdivisions.  
Notwithstanding any other statute to the contrary, the gross amount of property taxes 
assessed upon real and personal property in the unorganized territory through the State Tax 
Assessor for the benefit of any special fund or political subdivision of the State may be 
credited on the books of the State to the special fund or to the proper fiscal officer of the 
political subdivision.  The Treasurer of State shall pay to that fiscal officer the amount of 
the tax so assessed, in equal quarterly amounts for unorganized territory services, on or 
before the last day of July, October, January and April and an annual installment for county 
taxes on or before October 15th following the date of the assessment.  The amount of the 
assessment is appropriated for the purposes of this subsection.
Sec. 38.  36 MRSA c. 915, as amended, is repealed.
Sec. 39.  38 MRSA §2219, as enacted by PL 1989, c. 585, Pt. A, §7, is amended to 
read:
§2219.  Leasehold or other interests of lessee taxable
The interest of the user of any project is subject to taxation in the manner provided for 
similar interests in Title 36, section 551, subject to Title 36, sections 655 and section 656.
Sec. 40.  Application. This Act applies to the status of personal property for property 
tax years beginning on or after April 1, 2024.
SUMMARY
This bill eliminates the imposition of taxes on personal property, except for excise taxes 
and sales and use taxes.  Due to the elimination of personal property taxation, this bill also 
eliminates the business equipment tax exemption and the Business Equipment Tax 
Reimbursement program.  The legislation applies to property tax years beginning on or 
after April 1, 2024.