Rocky Mengle
Maine state tax: Overview
If you've ever wondered how Maine stacks up when it comes to taxes, here's what you need to know: Maine's state income tax starts at 5.8%, which puts it on the higher end compared to much of the country.
But there's an upside—no local sales taxes anywhere in the state, which means what you see is what you pay at the register.
And if you're thinking long term, Maine does have an estate tax, though estates under $7 million are in the clear.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
[Data for this state tax guide was gathered from several sources including the U.S. Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]
Maine income tax
Maine has a graduate state individual income tax rate that ranges from 5.80% to 7.15%, according to the Tax Foundation.
Maine retirement taxes
Maine Tax on Retirement Benefits: Maine does not tax Social Security or Railroad Retirement benefits. Military benefits are also tax-exempt. Retirees who receive MainePERS benefits may qualify for a pension exclusion of up to $45,864.
- Social Security: Not taxable
- Pensions: Partially taxable (Federal pension income is exempt)
- 401(k) and IRA Distributions: Taxable
Maine sales tax
The statewide sales tax in Maine is 5.50%, and there are no additional local sales taxes, according to the Tax Foundation.
- Grocery: Exempt
- Prescription drugs: Exempt
- Clothing: Taxable
How much are property taxes in Maine?
In Maine, the effective tax rate is 0.94%, which is about average compared to other states.
Source: Tax Foundation
Maine Property Tax Breaks for Retirees
Property Tax Stabilization Program: Eligible homeowners may have their property taxes frozen, preventing tax increases. Homeowners may transfer the property tax freeze if they move (as long as they qualify). Maine residents must apply for property tax stabilization program.
Homestead Exemption: Maine offers a homestead exemption of up to $25,000 to eligible homeowners. To qualify, homeowners must have owned a home in Maine for at least 12 months.
(Note: Homeowners may need to meet additional criteria to qualify for property tax breaks. Additional tax breaks may be available.)
Maine gas tax
Gasoline | $0.30 per gallon |
Diesel | $0.31 per gallon |
Source: Sales Tax Handbook
Maine taxes on alcohol and tobacco
Product | Tax Amount |
|---|---|
Cigarettes | $2.00 per pack |
Chewing tobacco/snuff | $2.02 per ounce |
Smoking tobacco/cigars | 20% of wholesale price |
Medical marijuana | 5.50% |
Recreational marijuana | 10% |
Source: Sales Tax Handbook
Product | Tax Amount |
|---|---|
Wine | $0.60 per gallon |
Beer | $0.35 per gallon |
Liquor | state-controlled |
Source: Sales Tax Handbook
Maine estate and inheritance taxes
Maine has an estate tax with an exemption of $7 million for 2025. Tax rates range from 8% to 12%. Gifts given up to one year before the decedent’s death are considered part of the estate.
More From Kiplinger
-
Retirement’s Most Rewarding Project: Writing the Story of Your Life -
I'm 57 with a great remote job, but my company wants me in the office full-time. I don't have the energy for a daily commute. Help!We asked career planning and human resources experts for advice on how to handle return-to-work orders.
-
Could Tax Savings Make a 50-Year Mortgage Worth It?Buying a Home The 50-year mortgage proposal by Trump aims to address the housing affordability crisis with lower monthly mortgage payments. But what does that mean for your taxes?
-
3 Ways High-Income Earners Can Maximize Their Charitable Donations in 2025Tax Deductions New charitable giving tax rules will soon lower your deduction for donations to charity — here’s what you should do now.
-
An HSA Sounds Great for Taxes: Here’s Why It Might Not Be Right for YouHealth Savings Even with the promise of ‘triple tax benefits,’ a health savings account might not be the best health plan option for everyone.
-
New RMD Rules: Can You Pass This Retirement Distributions Tax Quiz?Quiz Take our RMD quiz to test your retirement tax knowledge. Learn about RMD rules, IRS deadlines, and tax penalties that could shrink your savings.
-
10 Retirement Tax Plan Moves to Make Before December 31Retirement Taxes Proactively reviewing your health coverage, RMDs and IRAs can lower retirement taxes in 2025 and 2026. Here’s how.
-
When to Hire a Tax Pro: The Age Most Americans Switch to a CPATax Tips Taxpayers may outsource their financial stress by a specific age. Find out when you should hire a tax preparer.
-
The Original Property Tax Hack: Avoiding The ‘Window Tax’Property Taxes Here’s how homeowners can challenge their home assessment and potentially reduce their property taxes — with a little lesson from history.
-
Social Security Tax Limit Rises Again: Who Pays More in 2026?Payroll Taxes The Social Security Administration has announced significant changes affecting millions as we approach a new year.
