STATE COMPARISON:

  • According to the American Trucking Associations, there are 38 states (including Maine) that have a state statutory interstate commerce sales tax exemption.
    • Of those 38 states, almost 2/3 of them have adopted an exemption that is much more clearly defined and much more simple to enforce compared to Maine:
    • The exemption applies to all vehicles over a certain registered weight;
    • The exemption applies to any for-hire company registered in the IRP or with an active DOT number;
    • The most simple application is in Alaska, Montana, New Hampshire and Oregon where there is no sales tax on any purchases.
  • A few of the states who don’t offer an exemption do offer a lower tax rate on equipment placed in interstate commerce and/or a capped tax amount of $500.
  • In July of 2017, Illinois passed legislation because their exemption (equipment used 50% in interstate commerce) was identified as being too cumbersome for companies to track and for their auditors to enforce – and likely to compete with neighboring Indiana.  The result is they now allow the exemption for all equipment if the carrier has an active interstate for-hire DOT number
  • Massachusetts does not currently have an exemption but efforts are currently underway and legislation has been introduced to adopt a sales tax exemption on rolling stock.  The reason for this recent effort is to reduce the economic disincentive to locate and retain trucking companies in Massachusetts.