Employment Tax Increment Financing: Businesses that create at least 5 jobs may be eligible to receive a refund ranging from 30% to 80% of state income tax withholdings paid by the business for the newly hired employees. Businesses that locate in Pine Tree Development Zones or areas of the state with high levels of unemployment qualify for a higher reimbursement rate (closer to 80% of state income tax withholdings). The refund is available for up to 10 years.
Research Expense Tax Credit: This incentive is based on a percentage of the federal Credit for Increasing Research Activities. The credit is limited to 5% of the qualified research expenses in excess of the previous three-year average, plus 7.5% of the basic research payments for qualified organizations (e.g.. educational, scientific, or grant institutions). For corporate taxpayers, the credit may not exceed 100% of the first $25,000 in tax liability, plus 75% of the tax liability in excess of $25,000. Credits may be carried forward for up to 15 years.
Business Equipment Tax Exemption (BETE): This program eliminates business personal property tax on eligible requirement.
Sales Tax Exemptions: A business may apply for a sales tax exemption on equipment to be used for biotechnology, custom computer programming, manufacturing and R&D-related activities.
Pine Tree Development Zones (PTDZ): Businesses that locate in one of the state’s Pine Tree Development Zones may qualify for corporate income tax credits, sales and use tax exemptions, a withholding tax reimbursement of 80% and reduced electricity rates. To qualify, a company must operate in one of Maine’s targeted industry sectors and create new jobs paying wages that exceed the per capita personal income of the county in which the project is located. The incentives available under this program are available for up to 10 years.
Last updated: April 2016