Maine has a sales tax of 5.5 percent on most goods
Maine charges a 5.5 percent sales tax on retail purchases of tangible goods. This is one of the lower sales tax rates in the country. The tax applies at the point of sale — the store adds it to your bill when you buy something, and you pay it then.
Some items are taxed at a higher rate. Prepared food — meals you eat in a restaurant or food bought hot from a deli counter — is taxed at 7 percent. This includes pizza, fried chicken, sandwiches made to order, and similar items. Groceries you buy raw and cook at home are taxed at the standard 5.5 percent rate.
Maine does not have a state income tax, which is unusual. The sales tax is one of the main ways the state funds itself. Because of this, the state relies more heavily on sales tax than many other states do.
Key Takeaways
- Maine's standard sales tax is 5.5 percent on most goods, and prepared food is taxed at 7 percent.
- Groceries, prescription medications, and medical devices are exempt from sales tax.
- Clothing and footwear under $175 per item are exempt from sales tax.
- Maine has no state income tax, so sales tax is a larger part of state revenue than in most states.
What is exempt from Maine sales tax
Several categories of items do not have sales tax added. Groceries — food you buy raw to cook at home — are not taxed. This includes bread, milk, vegetables, meat, and canned goods. The line between grocery and prepared food matters: a rotisserie chicken from the grocery store deli counter is taxed, but a raw chicken is not.
Prescription medications are exempt. Over-the-counter medicines like aspirin and cold medicine are taxed, but anything you need a prescription to buy is not. Medical devices prescribed by a doctor — such as diabetic testing supplies, hearing aids, and prosthetics — are also exempt.
Clothing and footwear under $175 per item are exempt from sales tax. A pair of shoes for $100 has no tax. A winter coat for $150 has no tax. A designer coat for $200 is taxed on the full amount. This exemption applies per item, not per purchase, so you could buy ten $174 shirts and pay no tax on any of them.
Items used in manufacturing or farming — machinery, equipment, and materials that become part of a product — are generally not taxed. This is meant to avoid taxing the same product twice, once as materials and again as a finished good.
How sales tax works when you shop online
If you buy from a Maine retailer online and have it shipped to a Maine address, sales tax is added. The store collects it and sends it to the state, just as they would for an in-store purchase.
If you buy from an out-of-state retailer, the rules depend on whether that retailer has a physical presence or employees in Maine. Large retailers like Amazon, Walmart, and Target collect Maine sales tax on orders shipped to Maine addresses. Smaller out-of-state sellers may not collect it. In those cases, Maine law says you owe the tax yourself — though most people do not pay it, and the state does not have a practical way to enforce it for individual purchases.
If you order something from out of state and pick it up in Maine, you pay tax at pickup. If you order it and have it shipped out of state, no Maine tax is added.
Sales tax on specific items you might wonder about
Gasoline has a separate fuel tax in addition to sales tax. The fuel tax is about 30 cents per gallon and goes to road maintenance. You also pay the 5.5 percent sales tax on top of that.
Alcohol — beer, wine, and liquor — is taxed at the standard 5.5 percent rate when you buy it at a store. Alcohol served in a bar or restaurant is part of the prepared food category and taxed at 7 percent.
Cigarettes and tobacco have their own state tax separate from sales tax. This tax is per pack or per unit, not a percentage. You pay both the tobacco tax and the 5.5 percent sales tax.
Services generally do not have sales tax in Maine. If you pay a plumber, electrician, accountant, or haircut, there is no sales tax. You pay what they charge. Some states tax services, but Maine does not.
Where the sales tax goes
All Maine sales tax collected goes to the state general fund. The state uses this money for schools, roads, public safety, and other state services. Unlike some states, Maine does not set aside a portion of sales tax for local cities and towns — those communities fund themselves through property taxes and other local revenue sources.
The state publishes sales tax revenue figures each month. When the economy is strong and people buy more, sales tax revenue goes up. During recessions, it drops. This makes sales tax less stable than income tax as a funding source, which is one reason some economists argue that relying heavily on sales tax creates budget uncertainty.
Frequently Asked Questions
Do I pay Maine sales tax if I live out of state but buy something in Maine?
Yes. Sales tax is based on where the item is sold or delivered, not where you live. If you are visiting Maine and buy something in a store, you pay Maine sales tax. If you live in New Hampshire and order something shipped to your Maine vacation home, you pay Maine tax.
Is there a local sales tax on top of the state rate?
No. Maine has only the state sales tax of 5.5 percent (or 7 percent for prepared food). Cities and towns do not add their own sales tax. Some states allow local jurisdictions to add a percentage on top of the state rate, but Maine does not.
What counts as prepared food versus groceries?
The key is whether the food is ready to eat or has been heated for serving. A sandwich made to order at a deli is prepared food (7 percent). Bread and deli meat you buy separately to make a sandwich at home are groceries (5.5 percent). Hot pizza is prepared food. Cold pizza from a grocery store bakery is also prepared food. Frozen pizza you cook at home is groceries.
Do I have to pay sales tax on items I buy used?
Used items sold by a business are taxed the same as new items. If you buy a used car from a dealer, you pay sales tax. If you buy a used item from an individual (like a private car sale or a garage sale), there is no sales tax — the tax only applies to retail sales.
What if a store forgets to charge me sales tax?
That is the store's error, not yours. You are not responsible for tracking whether tax was charged correctly. The store owes the tax to the state regardless. If you notice before leaving, you can point it out, but you are not obligated to.