Sec. K-1. 36 MRSA §5219-Y is enacted to read:

§5219-Y.__Principal residence transfer credit

A taxpayer who transfers property that was the taxpayer's permanent residence or who purchases property for that taxpayer's permanent residence, as defined in section 681, is allowed a refundable credit against the tax imposed under this Part equal to 50% of the tax paid by the taxpayer under section 4641-A.

Sec. K-2. Application. This Part applies to tax years beginning on or after January 1, 2006.

PART L

Sec. L-1. 36 MRSA §4365, as amended by PL 2003, c. 705, §6, is further amended to read:

§4365. Rate of tax

A tax is imposed on all cigarettes imported into this State or held in this State by any person for sale at the rate of 47 75 mills for each cigarette. Payment of the tax is evidenced by the affixing of stamps to the packages containing the cigarettes.

Sec. L-2. 36 MRSA §4365-E, as enacted by PL 2001, c. 439, Pt. SSSS, §2, is repealed.

Sec. L-3. 36 MRSA §4365-F is enacted to read:

§4365-F.__Application of cigarette tax rate increase

effective January 1, 2006

The following provisions apply to cigarettes held for resale on January 1, 2006.

1.__Stamped rate.__Cigarettes stamped at the rate of 47 mills per cigarette and held for resale after December 31, 2005 are subject to tax at the rate of 75 mills per cigarette.

2.__Liability.__A person possessing cigarettes for resale is liable for the difference between the tax rate of 75 mills per cigarette and the tax rate of 50 mills per cigarette in effect before January 1, 2006.__Stamps indicating payment of the tax imposed by this section must be affixed to all packages of cigarettes held for resale as of January 1, 2006, except that