Sec. 1. 36 MRSA §1816 is enacted to read:

§1816.__Local option sales and use tax

1.__Municipalities authorized to adopt.__If the legal voters of a municipality give their approval in a referendum vote, the legislative body of that municipality may impose a local option sales and use tax on transactions subject to the tax imposed under this chapter.

2.__Notify State Tax Assessor.__A municipality that imposes a local option sales and use tax under this section shall notify the State Tax Assessor at least 90 days before the local tax is effective.

3.__Administered by State.__Retailers in a municipality that has imposed a local option sales and use tax under this section shall transfer the revenue from that tax at the time of and in the manner provided for the transfer of state sales and use tax revenue.__The tax is subject to the same interest, penalties and administrative actions as other taxes assessed under this Part.

4.__Transfer of revenue.__Each month the State Tax Assessor shall identify the amount of revenue attributable to each municipality under this section, subtract the costs of administering this section and certify the net amount due each municipality to the Treasurer of State.__The Treasurer of State shall make monthly payments to municipal treasurers of the net amounts certified by the State Tax Assessor under this subsection.__Revenue collected pursuant to this section is not considered to be receipts from the taxes imposed under this Part for purposes of transfers to the Local Government Fund under Title 30-A, section 5681.

5.__Use of local sales and use tax revenue.__The revenue raised by the adoption of a local option sales and use tax must be held by the municipality in a special revenue account established for that purpose.__Revenue from that account may be expended only if specifically authorized by an appropriation of the local legislative body for public improvements or economic development or to reduce the property tax commitment.

6.__Referendum.__The question of whether to impose a local option sales and use tax must be submitted to the legal voters of a municipality that seeks to impose the local option sales and use tax.