CHAPTER 584
S.P. 667 - L.D. 1871
An Act to Conform Maine Tax Law to the Federal Mobile Telecommunications Sourcing Act
Emergency preamble. Whereas, Acts of the Legislature do not become effective until 90 days after adjournment unless enacted as emergencies; and
Whereas, the federal Mobile Telecommunications Sourcing Act requires states to make certain changes in the way they tax mobile telecommunications services, and that Act applies to customer bills issued after August 1, 2002; and
Whereas, legislative action is immediately necessary in order to ensure continued, efficient and lawful administration of Maine's sales and use tax law as it applies to mobile telecommunications services; and
Whereas, in the judgment of the Legislature, these facts create an emergency within the meaning of the Constitution of Maine and require the following legislation as immediately necessary for the preservation of the public peace, health and safety; now, therefore,
Be it enacted by the People of the State of Maine as follows:
Sec. 1. 25 MRSA §2927, sub-§1-B, as amended by PL 2001, c. 439, Pt. EEEE, §6, is further amended to read:
1-B. Statewide E-9-1-1 surcharge. The activities authorized under this chapter are funded through a special statewide E-9-1-1 surcharge levied on each residential and business telephone exchange line, including private branch exchange lines and Centrex lines, cellular or wireless telecommunications service subscribers and semipublic coin and public access lines. The statewide E-9-1-1 surcharge may not be imposed on more than 25 lines or numbers per customer billing account. In the case of cellular or wireless telecommunications service subscribers, the place of residence of those subscribers must be determined according to the sourcing rules for mobile telecommunications services set forth in Title 36, section 1816. The statewide E-9-1-1 surcharge is 50¢ per month per line or number until 90 days after adjournment of the First Regular Session of the 121st Legislature, after which time the statewide E-9-1-1 surcharge is 32¢ per month per line or number. The statewide E-9-1-1 surcharge must be billed on a monthly basis by each local exchange telephone utility or cellular or wireless telecommunications service provider and be shown separately as a statewide E-9-1-1 surcharge on the customer's bill.
Sec. 2. 36 MRSA §1752, sub-§3-E is enacted to read:
3-E. Home service provider. "Home service provider" means the facilities-based carrier or reseller with which a customer contracts for the provision of mobile telecommunications services.
Sec. 3. 36 MRSA §1752, sub-§6-B is enacted to read:
6-B. Mobile telecommunications services. "Mobile telecommunications services" means commercial mobile radio service as defined in 47 Code of Federal Regulations, Section 20.3 as in effect on July 1, 1999. For purposes of sourcing, "mobile telecommunications services" does not include air-ground radiotelephone service as defined in 47 Code of Federal Regulations, Section 22.99 as in effect in June 1, 1999.
Sec. 4. 36 MRSA §1752, sub-§7-E is enacted to read:
7-E. Place of primary use. "Place of primary use" means the street address representative of where a customer's use of mobile telecommunications services primarily occurs, which must be either the residential street address or the primary business street address of the customer and must also be located within the licensed service area of the home service provider. For purposes of determining the place of primary use, "customer" means the person or entity that contracts with the home service provider for mobile telecommunications services, or, if the end user of such services is not the contracting party, the person that is the end user of such services. The term "customer" does not include a reseller of mobile telecommunications services, or a serving carrier under an agreement to serve the customer outside the home service provider's licensed service area.
Sec. 5. 36 MRSA §1752, sub-§8-B, as enacted by PL 1999, c. 488, §2, is amended to read:
8-B. Prepaid calling arrangement. "Prepaid calling arrangement" means the right to purchase exclusively telecommunications services, which that must be paid for in advance, that enables the origination of calls using an access number or authorization code or both, whether manually or electronically dialed, if the remaining amount of units of service that have been prepaid is known by the provider of the prepaid service on a continuous basis. The sale or recharge of the service is considered a sale within the State if the transfer for consideration takes place at the vendor's place of business in the State. If the sale or recharge of a prepaid calling arrangement does not take place at the vendor's place of business, the sale or recharge is deemed to take place at the customer's shipping address, or if there is no item shipped, at the customer's billing address or the location associated with the customer's mobile telephone number. The sale of the service is deemed to occur on the date of the transfer for consideration of the service.
Sec. 6. 36 MRSA §1752, sub-§9-D is enacted to read:
9-D. Reseller. "Reseller," when used in relation to mobile telecommunications services, means a provider that purchases telecommunications services from another telecommunications service provider and then resells, uses as a component part of or integrates the purchased services into mobile telecommunications services. "Reseller" does not include a serving carrier with which a home service provider arranges for services to its customers outside the home service provider's licensed service area.
Sec. 7. 36 MRSA §1752, sub-§14-D is enacted to read:
14-D. Serving carrier. "Serving carrier," when used in relation to mobile telecommunications services, means a facilities-based carrier providing mobile telecommunications services to a customer outside a home service provider's licensed service area.
Sec. 8. 36 MRSA §1752, sub-§18-D, as enacted by PL 1999, c. 488, §10, is amended to read:
18-D. Telecommunications services. "Telecommunications services" means all telecommunications services as described in this subsection.
A. "Telecommunications services" includes:
(1) The provision of 2-way interactive communications through the use of telecommunications equipment, exclusive of mobile telecommunications services; or
(2) The installation, maintenance or repair of telecommunications equipment.; and
(3) Two-way interactive mobile telecommunications services provided by a home service provider to a customer whose place of primary use is within this State, to the extent those services are associated with transmissions that originate and terminate within this State or within any other state. For purposes of this paragraph, the term "state" includes the District of Columbia and any territory or possession of the United States.
B. "Telecommunications services" does not include:
(1) Service Except as otherwise provided by this subsection, service originating or terminating outside this State;
(2) Access services;
(3) Directory advertising services;
(4) The sale of unbundled network elements for use in the provision of telecommunications services;
(5) For leases entered into on or after October 1, 1996, "telecommunications services" does not include the lease of telecommunications equipment; or
(6) A prepaid calling arrangement.; or
(7) Mobile telecommunications services provided by a home service provider to a customer whose place of primary use is not within this State.
Sec. 9. 36 MRSA §1816 is enacted to read:
§1816. Special rules for mobile telecommunications services
1. Sourcing rule; identifying place of primary use. Mobile telecommunications services provided to a customer whose place of primary use is located in this State, the charges for which are billed by or for the customer's home service provider, are deemed to be provided at the customer's place of primary use. A home service provider is responsible for obtaining and maintaining a record of a customer's place of primary use. Subject to subsection 2 and if the home service provider's reliance on the information provided by its customer is in good faith, the home service provider:
A. May rely on the applicable residential or business street address supplied by the home service provider's customer; and
B. May not be held liable for any additional taxes under this Part based on a different determination of the place of primary use.
2. Correction of place of primary use; determination by State Tax Assessor. If the State Tax Assessor determines that the address used by a home service provider as a customer's place of primary use does not meet the definition provided by section 1752, subsection 7-E, the assessor shall notify the customer in writing of that determination and provide the customer an opportunity to demonstrate that that address is the customer's place of primary use. If the customer fails to demonstrate to the assessor's satisfaction within 30 days from the time it receives notice from the assessor, or within another time period as the assessor may allow, that the address in question is the customer's place of primary use, the assessor shall provide the home service provider with the proper address to be used as the customer's place of primary use. The home service provider shall begin using the address provided by the assessor as the customer's place of primary use within 30 days from the date it receives notice of the assessor's determination.
3. Hold harmless provision; use of electronic database or enhanced zip code. A home service provider is entitled to the hold harmless protections provided by the federal Mobile Telecommunications Sourcing Act, Public Law 106-252, Section 1, 114 Stat. 2, 2000.
4. Bundled services. Notwithstanding any other provision of this Part, otherwise nontaxable charges that are aggregated with and not separately stated from taxable mobile telecommunications charges are subject to taxation unless the home service provider can, to the satisfaction of the State Tax Assessor, reasonably identify such charges from books and records kept in the regular course of its business. A customer may not rely upon the nontaxability of bundled services unless the customer's home service provider separately states the otherwise nontaxable services or the home service provider elects, after receiving written notice from the customer in the form required by the provider, to provide verifiable data based upon the home service provider's books and records that are kept in the regular course of business and that reasonably identify the nontaxable charges.
5. Transitional provision. Subject to subsection 2, a home service provider may treat the address used by it for purposes of the tax imposed by this Part for any customer under a service contract or agreement in effect on July 28, 2002 as that customer's place of primary use for the remaining term of the service contract or agreement, excluding any extension or renewal period.
Sec. 10. Application date. This Act applies to customer bills issued by providers of mobile telecommunications services after August 1, 2002.
Emergency clause. In view of the emergency cited in the preamble, this Act takes effect when approved.
Effective April 1, 2002.
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