An Act to Expand the Sales Tax to Luxury Services and Adjust the
Maine Legislature, Session 132, LD 1807
Sponsors: SKOLD, DAUGHTRY
Amends: 36 MRSA §1752, 36 MRSA §1760, 36 MRSA §1811

Legislative Document
No. 1807
H.P. 1208
House of Representatives, April 29, 2025
An Act to Expand the Sales Tax to Luxury Services and Adjust the 
Sales Tax on Rental Cars
Received by the Clerk of the House on April 25, 2025.  Referred to the Committee on 
Taxation pursuant to Joint Rule 308.2 and ordered printed pursuant to Joint Rule 401.
ROBERT B. HUNT
Clerk
Presented by Representative SKOLD of Portland.
Cosponsored by President DAUGHTRY of Cumberland and
Representatives: GOLEK of Harpswell, LOOKNER of Portland, MATLACK of St. George, 
ROEDER of Bangor.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §1752, sub-§17-B, as amended by PL 2023, c. 643, Pt. H, §19 
and affected by §29 and amended by c. 673, §19 and affected by §28, is repealed and the 
following enacted in its place:
17-B.  Taxable service.  "Taxable service" means the: 
A. Rental of living quarters in a hotel, rooming house or tourist or trailer camp; 
B. Transmission and distribution of electricity; 
C. Sale of an extended service contract on an automobile or truck that entitles the 
purchaser to specific benefits in the service of the automobile or truck for a specific 
duration; 
D. Sale of prepaid calling service; 
E. Charter of a private aircraft or helicopter; 
F. Rental of a limousine or luxury car; and
G. Charter of watercraft in excess of 25 feet. 
The department may adopt rules to implement this subsection.  Rules adopted pursuant to 
this subsection are routine technical rules as defined in Title 5, chapter 375, subchapter 
2-A.
Sec. 2.  36 MRSA §1760, sub-§92, as enacted by PL 2011, c. 209, §3 and affected 
by §5, is repealed.
Sec. 3.  36 MRSA §1811, sub-§1, ¶D, as amended by PL 2023, c. 643, Pt. H, §23 
and affected by §29 and amended by c. 673, §22 and affected by §28, is further amended 
to read:
D.  For sales occurring on or after October 1, 2019 and before January 1, 2026, the rate 
of tax is 5.5% on the value of all tangible personal property and taxable services, except 
the rate of tax is:
(1)  Eight percent on the value of prepared food;
(2)  Eight percent on the value of liquor sold in licensed establishments as defined 
in Title 28‑A, section 2, subsection 15, in accordance with Title 28‑A, chapter 43 
and liquor sold for on-premises consumption by a licensed brewery, small brewery, 
winery, small winery, distillery or small distillery pursuant to Title 28‑A, section 
1355‑A, subsection 2, paragraph B;
(3)  Nine percent on the value of rental of living quarters in any hotel, rooming 
house or tourist or trailer camp;
(4)  Ten percent on the value of rental for a period of less than one year of:
(a)  An automobile; or
(c)  A loaner vehicle that is provided other than to a motor vehicle dealer's 
service customers pursuant to a manufacturer's or dealer's warranty; and
(5)  Ten percent on the value of adult use cannabis, adult use cannabis products 
and, if sold by a person to an individual who is not a qualifying patient, cannabis 
and cannabis products beginning on the first day of the calendar month in which 
adult use cannabis and adult use cannabis products may be sold in the State by a 
cannabis establishment licensed to conduct retail sales pursuant to Title 28‑B, 
chapter 1.
Sec. 4.  36 MRSA §1811, sub-§1, ¶E is enacted to read:
E.  For sales occurring on or after January 1, 2026, the rate of tax is 5.5% on the value 
of all tangible personal property and taxable services, except the rate of tax is:  
(1) Eight percent on the value of prepared food;  
(2) Eight percent on the value of liquor sold in licensed establishments as defined 
in Title 28‑A, section 2, subsection 15, in accordance with Title 28‑A, chapter 43 
and liquor sold for on-premises consumption by a licensed brewery, small brewery, 
winery, small winery, distillery or small distillery pursuant to Title 28‑A, section 
1355‑A, subsection 2, paragraph B;  
(3) Nine percent on the value of rental of living quarters in any hotel, rooming 
house or tourist or trailer camp;  
(4) Fifteen percent on the value of an automobile rental for a period of less than 
one year; and 
(5) Ten percent on the value of adult use cannabis, adult use cannabis products and, 
if sold by a person to an individual who is not a qualifying patient, cannabis and 
cannabis products by a cannabis establishment licensed to conduct retail sales 
pursuant to Title 28‑B, chapter 1.
Sec. 5.  Application. This Act applies to sales occurring on or after January 1, 2026.
SUMMARY
This bill increases the sales tax rate on short-term automobile rentals from 10% to 15% 
and eliminates the exemption for short-term automobile rentals associated with car 
dealership-initiated loaner vehicles.  The bill also creates new categories of luxury services 
subject to sales tax.