Section 125-323-7 - CERTIFICATE OF EXEMPTION1.Application. Any person claiming exemption under 36 MRSA §2013, sub-§ 3 must apply to the State Tax Assessor for a certificate of exemption. The application must be on a form prescribed by the State Tax Assessor and must include a copy of the portion of the person's most recent federal income tax return that shows the person is engaged in a qualifying activity.2.Issuance. A certificate of exemption will be issued by the State Tax Assessor to persons who have submitted an application that shows they are engaged in a qualifying activity. The certificate of exemption is effective for a maximum of four years from the date of issuance.3.Exceptions. A certificate of exemption will not be issued to the following persons: A. Persons whose most recent federal income tax return does not show that the person was engaged in a qualifying activity; orB. Persons who are primarily engaged in a related but non-qualifying business activity.4.Use restricted. The certificate of exemption may not be used to purchase the following items without payment of sales tax: A. Items that are less than 100% depreciable.B. Items that are not commonly used directly in a qualifying activity as determined by the State Tax Assessor, including lawn and garden tractors of less than 20 horsepower, backhoe tractors, fork lift trucks, snowmobiles, all-terrain vehicles and computers.5.Refund of tax paid. The following persons may apply directly to Maine Revenue Services for a refund of sales or use tax paid on purchases of depreciable machinery and equipment used directly and primarily in a qualifying activity: A. Persons who have not been issued a certificate of exemption;B. Purchasers of items that are less than 100% depreciable; andC. Purchasers of items that are not commonly used directly in a qualifying activity.6.Requirements of seller. The burden of proving a sale is to a person that has been issued a certificate of exemption is upon the person making the sale. This burden of proof will be met if the seller obtains from the purchaser a signed affidavit and a copy of a valid certificate of exemption issued by Maine Revenue Services in accordance with the provisions of this Rule. The seller must retain an affidavit and a copy of the certificate of exemption of each person to whom exempt sales are made, but need not obtain a separate affidavit or copy of the certificate for each individual sale. Invoices must be appropriately marked to indicate that they are exempt sales. This requirement is satisfied by the purchaser's certificate of exemption and the words "Maine Sales Tax Exempt."
7.Good faith requirement. The certificate of exemption must be taken in good faith by the seller. This good faith requirement is not met if the seller knows or could reasonably infer that the purchaser is not the holder of the certificate of exemption, or that the merchandise will not be used by the purchaser directly and primarily in a qualifying activity.8.Misuse of certificate of exemption. Misuse of the certificate of exemption will result in its cancellation. The certificate must be surrendered at the request of the State Tax Assessor.18- 125 C.M.R. ch. 323, § 7