A.__On cigars, 25% of the wholesale sales price beginning January 1, 2006; and

B.__On pipe tobacco and other tobacco intended for smoking, 100% of the wholesale sales price beginning January 1, 2006.

Sec. L-9. Effective date. This Part takes effect January 1, 2006.

PART M

Sec. M-1. 28-A MRSA §1652, sub-§1, as repealed and replaced by PL 1987, c. 342, §116, is amended to read:

1. Excise tax on malt liquor. An excise tax is imposed on the privilege of manufacturing and selling malt liquor in the State. The Maine manufacturer or importing wholesale licensee shall pay an excise tax of 25¢ 50¢ per gallon on all malt liquor sold in the State.

Sec. M-2. 28-A MRSA §1652, sub-§2, as amended by PL 1997, c. 767, §4, is further amended to read:

2. Excise tax on wine and hard cider. An excise tax is imposed on the privilege of manufacturing and selling wine in the State. The Maine manufacturer or importing wholesale licensee shall pay an excise tax of 30¢ $1 per gallon on all wine other than and sparkling wine manufactured in or imported into the State, $1 per gallon on all sparkling wine manufactured in or imported into the State and 25¢ $1 per gallon on all hard cider manufactured in or imported into the State.

Sec. M-3. Effective date. This Part takes effect January 1, 2006.

SUMMARY

This bill makes major changes to Maine's tax structure beginning January 1, 2006.

Part A changes the existing graduated income tax program into a flat tax rate of 6% and corrects cross-references. Part A also repeals the alternative minimum tax.