Direct Payment Permits Form - Maine Revenue Services printable pdf download

Direct Payment Permits Form - Maine Revenue Services

MAINE REVENUE SERVICES

SALES, FUEL AND SPECIAL TAX DIVISION

RULE NO. 308

DIRECT PAY PERMITS

SUMMARY: Establishes a system for combined reporting of purchases by

manufacturers and utilities under a direct payment permit.

SECTION 1. Introduction

Many manufacturers and utilities routinely acquire large quantities of tangible

personal property under circumstances that make it impractical to determine, at the time

of purchase, the manner in which property will be used. It is impractical in these

circumstances to determine whether the purchase or use of the property will be taxable or

exempt. Holders of direct payment permits are authorized to purchase most items of

tangible personal property without payment of the tax to their vendors, and may instead

report and pay tax directly to the State.

SECTION 2. General Requirements

The following requirements must be met by a taxpayer in order to be eligible to

receive a direct pay permit:

1. A permit application must be filed with the Bureau of Revenue Services (“the

bureau”) on a special form provided by the Bureau.

2. The applicant must hold a valid Maine Retailer Certificate.

3. The applicant must routinely purchase large quantities of tangible personal

property under circumstances that make it impractical to determine, at the time of

purchase, whether the purchase or use of the property will be taxable or exempt.

4. The applicant must establish to the satisfaction of the State Tax Assessor that

its accounting methods will clearly reflect the proper amount of tax due and that payment

of sales or use taxes to the State will not be jeopardized by permitting sales and use taxes

to be reported directly.

5. The applicant must make purchases in sufficient volume to justify the expense

of regular audits by the Bureau.

6. The applicant must be either a manufacturer or a utility.

SECTION 3. Manner in Which Direct Payment Permit is to be used by Taxpayer

Each holder of a direct payment permit must file a copy of the permit with each of

its vendors and ensure that the permit number is placed on all purchase orders or

contracts covering the purchase of tangible personal property, in lieu of payment of tax to

the retailer, except in those transactions excluded in Section 4 below. The holder of

Direct Payment Permits Form - Maine Revenue Services