Business Strategies

Maine Eyes Tax on Groundwater for Bottling

By Pan Demetrakakes, Senior Editor

Apr 11, 2019

Legislators in Maine are considering an “extraction tax” for underground water that seems to be aimed squarely at Nestlé Waters.

The proposed legislation would levy a tax of 12 cents per gallon on any company that extracts more than 1.5 million gallons of water per year from underground for commercial bottling purposes. Currently it would apply only to Nestlé, which extracts nearly a billion gallons a year from 10 different sites for its Poland Spring brand.

The tax would yield more than $100 million a year, according to supporters’ estimates. The money would be used for municipal broadband internet access, college tuition grants and possibly other purposes.

Neither Maine nor any other location now charges extraction fees for underground water. Supporters contend that it’s unfair for companies, especially those operating mostly outside Maine, to profit from the state’s groundwater for free. Opponents argue that Maine groundwater is plentiful, that some farms extract more than Nestlé, and that the tax would discourage outside investment in the state.

A committee on tax matters held a hearing on the measure last month, but no further action has been taken.