|The Maine Press Association is working with Maine Revenue Services regarding the implementation of the state’s new 5.5 percent sales tax on newspaper subscriptions and single-copy sales. Tax collections are scheduled to start on Oct. 1.
The MPA will hold a conference call with Maine Revenue Services officials on Thursday, Sept. 5 at 3:30 p.m. The call is for members to ask specific questions about the tax implementation.
The call information is:
Maine Revenue Services also plans four sales tax symposiums across the state in September to engage businesses affected by changes in the sales tax. This is another opportunity to engage the agency directly with questions or concerns.
The registration deadline for the symposiums is Sept. 6. There is a registration fee of either $40 or $10, depending on your attendance.
The four dates are:
Sept. 16 Augusta – Elks Lodge
Sept. 18 Portland – Italian Heritage Center
Sept. 23 Caribou – Caribou Inn and Convention Center
Sept. 24 Bangor - Spectacular Event Center
For more information, please see the symposium page on the MRS website.
Maine Revenue Services has answered some early questions posed by the MPA:
-- Does the sales tax apply to subscriptions sold to and/or delivered to out-of-staters?
No. If you have an out-of-state subscriber, and you're mailing to an out-of-state destination, that will not be subject to tax. Part-time residents who have their subscriptions delivered within Maine for a period of time are also exempt, provided the original sale is for out-of-state delivery.
-- How does the sales tax apply to newspaper copies sold below the retail price?
Buyers are taxed on the sale price of the paper, regardless of whether it’s sold wholesale or retail.
-- Are newspapers and subscriptions purchased by schools, governmental entities and certain nonprofits exempt from the tax?
Yes. This also goes for sponsored copies purchased by schools through Newspapers In Education.
-- How should the sales tax be collected from coin boxes?
The tax should be collected as 5.5 percent of the revenue from a coin box, as opposed to the number of copies sold from the box.
The MPA and Maine Revenue Services are still seeking guidance on:
-- Taxation of digital subscriptions/replica copies.
-- Collection/remittance of sales tax on subscriptions sold carrier-collect.
If your newspaper has carriers who collect subscription payments, please contact the MPA’s Executive Director Jeff Ham and legal counsel Mike Mahoney, so we can ensure you’re included in updates about it.
Maine Revenue Services has also released this guidance memo:
Maine Revenue Service is issuing guidance for taxpayers engaged in the sale of publications in Maine. Effective October 1, 2013, the sales tax exemption for “publication[s] regularly issued at average intervals not exceeding 3 months” is repealed. Sales of publications will become subject to a 5.5% sales tax. This notice provides guidance for applying the law to transactions that occur around the effective date.
A sale occurs when there is a transfer of a product or service for consideration. With in-person transactions, these actions occur simultaneously. Over the counter sales of publications occurring on or after October 1 are subject to sales tax.
Publications are often sold on a subscription basis, with payment (or a promise to pay) and delivery occurring at different times. For transition purposes, Maine Revenue Service will treat the first date of the subscription period as the sale date. If the first issue of a new subscription is prior to October 1, 2013, the sale is exempt from tax. If the first issue of a new subscription is on or after October 1, 2013, the sale price of the subscription will be taxable. When a subscription renews, each renewal period is considered a new transaction and taxed accordingly.
The law provides an exemption from sales tax for any goods delivered outside the State.
The law also provides an exemption for shipping charges if all three of the following criteria are met:
1. Shipment is directly from the seller to the purchaser,
2. The shipping charges are separately stated* to the customer and
3. The delivery is made by a common or contract carrier or the United States mail.
*Shipping is not separately stated when combined with charges for other services, like “shipping and handling”
Answers to additional questions are being compiled and will be issued when completed.
Any more questions and concerns should be directed to:
Jeff Ham, MPA Executive Director, firstname.lastname@example.org
Mike Mahoney, MPA legal counsel, email@example.com
Tony Ronzio, Chair, MPA Legislative Committee, firstname.lastname@example.org
Earl Brechlin, MPA President, email@example.com
For circulation-specific questions, Mike Theriault of the Sun Journal has offered his expertise for MPA members. Please contact him at firstname.lastname@example.org.