Both the Maine State House and Senate have unanimously approved an emergency bill expanding the state’s sales tax exemption for the sale and delivery of residential electricity.
Originating as a proposal to establish a refundable tax credit worth as much as $600, LD 2078 was later amended to a more straightforward expansion of the existing structure.
Under current state law, the first 750 kilowatt hours of electricity are exempt from sales tax, as well as “off-peak residential electricity used for space heating or water heating.” Any electricity consumed by customers enrolled in low-income assistance programs is also exempted from sales tax.
The sponsor’s amendment offered by Rep. Kilton Webb (D-Durham) eliminates these qualifying categories, allowing the sale and delivery of all residential electricity across the board to be exempted from sales tax.
[RELATED: Maine Lawmakers Consider Refundable Electricity Cost Fairness Tax Credit Worth Up To $600]
According to an Axios report from this past summer, Mainers saw the highest year-over-year increase in electricity costs nationwide between 2024 and 2025.
In just one year, from May 2024 to May 2025, Maine’s average residential energy costs increased by a staggering 36.3 percent.
Nationwide, there was an increase of just 6.5 percent during this same period.
[RELATED: Maine Has Highest 2024-2025 Energy Cost Increase With Staggering 36% Hike]
Following a February 10 work session, members of the Taxation Committee voted unanimously in support of an amended version of LD 2078.
About a month later, the Senate went on to accept this recommendation without taking a roll call vote.
Two days later, the House followed suit, voting 136-0 in favor of advancing the legislation.
Should Gov. Janet Mills (D) sign LD 2078 into law, state statutes would be updated immediately, as the emergency designation exempts the measure from the usual 90-day waiting period following the Legislature’s adjournment for the session.
Emergency measures require support from at least two-thirds of lawmakers in both chambers in order to pass — a higher bar than the simple majority needed for most items considered by lawmakers. LD 2078, however, easily cleared this hurdle.
Under the language of this bill, the expanded exemption would take effect on July 1, 2026, sooner than the January 1, 2027 date included in the original sponsor’s amendment.
Both the emergency clause and updated start date were proposed by Sen. Bruce Bickford (R-Androscoggin) during the February work session and ultimately incorporated into the final version of the bill recommended by the committee.
