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franchise tax

A franchise tax is a state tax on businesses and other entities (corporations, limited liability companies, trusts, etc.) that are formed in or doing business in a state.

A franchise tax is said to be a tax on the privilege of doing business in a state and is sometimes referred to as a privilege tax. The amount of tax due is often calculated as a percentage of a business’s income, for example.

In Maine, there is no specific tax referred to as a 'franchise tax' or 'privilege tax' on businesses. Instead, businesses operating in Maine are subject to the state's corporate income tax, which applies to corporations doing business in the state. The corporate income tax rate in Maine varies depending on the amount of taxable income the corporation earns. As of the knowledge cutoff in 2023, the rates range from 3.5% for income up to $350,000, to 7.93% for income over $3.5 million. Additionally, Maine imposes a Business Equipment Tax Reimbursement (BETR) program, which is designed to reimburse businesses for local property taxes paid on qualified business equipment. While not a franchise tax, these taxes and programs represent the state's approach to taxing the privilege of doing business within its borders.

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Taxes

franchise tax

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Maine State Code

Maine State Code

Taxes

franchise tax

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