Direct Payment Permits - Maine Sales/excise Tax Division printable pdf download

Direct Payment Permits - Maine Sales/excise Tax Division

MAINE REVENUE SERVICES

(FORMERLY BUREAU OF TAXATION)

SALES/EXCISE TAX DIVISION

RULE 308

DIRECT PAYMENT PERMITS

SUMMARY: Establishes a system for combined reporting of purchases by manufacturers

and utilities under a direct payment permit.

Introduction

Manufacturers and utilities which commonly acquire a substantial amount of tangible

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

purchase, the manner in which property will be used and, therefore, impractical to determine

whether the purchase or use of the property will be taxable or exempt, are authorized to remit tax

pursuant to a direct payment permit. Holders of direct payment permits are given the privilege of

purchasing tangible personal property without payment of the tax to their retailers and reporting

and paying tax directly to the State.

General Requirements

To receive a direct payment permit, the following requirements must be met by the

taxpayer:

A. Application for direct payment permit must be filed with the Bureau of Taxation on a

special form provided by the Bureau.

B. The applicant must hold a valid Maine Sales Tax Registration Certificate.

C. The applicant's activity must include, in a substantial amount, purchases of tangible

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

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

D. The applicant must substantiate to the Bureau of Taxation that his 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.

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

regular audits by the Bureau of Taxation.

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

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

Direct Payment Permits - Maine Sales/excise Tax Division