An Act To Allow A Local Option Sales Tax On Short-Term Lodging To Fund Affordable Housing

LD 632 allows Maine municipalities to impose a 2% local sales tax on short-term lodging (such as hotels, vacation rentals, and tourist camps) if approved by a voter referendum. The tax revenue must fund affordable housing programs within the municipality, including construction, renovation, and rental assistance for lower and moderate income households. Specifically, 15% of the collected revenue goes to the Maine State Housing Authority for rural housing initiatives, while the remaining funds return to the municipality for local housing projects. The tax requires voter approval (a majority of votes cast with at least 20% turnout from the last gubernatorial election) and cannot take effect before January 1, 2026.