Maine – Service Provider Tax Guidance

SALT Report 3020 – Maine Revenue Services revised a sales and use tax bulletin that addresses the service provider tax to include updates regarding taxable services administered by the Department of Health and Human Services.  Specifically, the bulletin provides that the following services are only taxable when provided by a designated provider under contract with DHHS.

  • Private non-medical institution or personal care services
  • Community support services for persons with mental health diagnoses
  • Community support services for persons with intellectual disabilities or autism
  • Group residential services for persons with brain injuries, and
  • Home support services

The taxable services above all require either licensing by DHHS, or a contract with DHHS.  Therefore, if you offer these services but are not licensed by, or are not under contract with DHHS, then these services are not subject to the service provider tax.

In addition, the bulletin points out that unlike sales tax, the service provider tax is not levied on the consumer, but instead is imposed on the provider or seller.  However, the provider/seller is allowed to pass the tax on to the consumer, if it is separately stated and identified on the invoice to the consumer as a “service provider tax.”

Lastly, the bulletin was updated to include a  section that addresses group residential services for persons with brain injuries, and that conference bridging services have been added to the listed of taxable ancillary telecommunications services.

For Further Information

Maine Revenue Services – Sales and Use Tax Instructional Bulletin No. 55