Rhode Island 2023 Regular Session

Rhode Island Senate Bill S0862 Compare Versions

Only one version of the bill is available at this time.

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5	5	2023 -- S 0862
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7	7	LC001655
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9	9	S T A T E O F R H O D E I S L A N D
10	10	IN GENERAL ASSEMBLY
11	11	JANUARY SESSION, A.D. 2023
12	12	____________
13	13
14	14	A N A C T
15	15	RELATING TO TAXATION -- PROPERTY SUBJECT TO TAXATION
16	16	Introduced By: Senator Tiara T. Mack
17	17	Date Introduced: March 30, 2023
18	18	Referred To: Senate Finance
19	19
20	20
21	21	It is enacted by the General Assembly as follows:
22	22	SECTION 1. Section 44-3-3 of the General Laws in Chapter 44-3 entitled "Property 1
23	23	Subject to Taxation" is hereby amended to read as follows: 2
24	24	44-3-3. Property exempt. 3
25	25	(a) The following property is exempt from taxation: 4
26	26	(1) Property belonging to the state, except as provided in § 44-4-4.1; 5
27	27	(2) Lands ceded or belonging to the United States; 6
28	28	(3) Bonds and other securities issued and exempted from taxation by the government of 7
29	29	the United States or of this state; 8
30	30	(4) Real estate, used exclusively for military purposes, owned by chartered or incorporated 9
31	31	organizations approved by the adjutant general and composed of members of the national guard, 10
32	32	the naval militia, or the independent, chartered-military organizations; 11
33	33	(5) Buildings for free public schools, buildings for religious worship, and the land upon 12
34	34	which they stand and immediately surrounding them, to an extent not exceeding five (5) acres so 13
35	35	far as the buildings and land are occupied and used exclusively for religious or educational 14
36	36	purposes; 15
37	37	(6) Dwellings houses and the land on which they stand, not exceeding one acre in size, or 16
38	38	the minimum lot size for zone in which the dwelling house is located, whichever is the greater, 17
39	39	owned by, or held in trust for, any religious organization and actually used by its officiating clergy; 18
40	40	provided, further, that in the town of Charlestown, where the property previously described in this 19
41	41
42	42
43	43	LC001655 - Page 2 of 39
44	44	paragraph is exempt in total, along with dwelling houses and the land on which they stand in 1
45	45	Charlestown, not exceeding one acre in size, or the minimum lot size for zone in which the dwelling 2
46	46	house is located, whichever is the greater, owned by, or held in trust for, any religious organization 3
47	47	and actually used by its officiating clergy, or used as a convent, nunnery, or retreat center by its 4
48	48	religious order; 5
49	49	(7) Intangible personal property owned by, or held in trust for, any religious or charitable 6
50	50	organization, if the principal or income is used or appropriated for religious or charitable purposes; 7
51	51	(8) Buildings and personal estate owned by any corporation used for a school, academy, or 8
52	52	seminary of learning, and of any incorporated public charitable institution, and the land upon which 9
53	53	the buildings stand and immediately surrounding them to an extent not exceeding one acre, so far 10
54	54	as they are used exclusively for educational purposes, but no property or estate whatever is hereafter 11
55	55	exempt from taxation in any case where any part of its income or profits, or of the business carried 12
56	56	on there, is divided among its owners or stockholders; provided, however, that unless any private 13
57	57	nonprofit corporation organized as a college or university located in the town of Smithfield reaches 14
58	58	a memorandum of agreement with the town of Smithfield, the town of Smithfield shall bill the 15
59	59	actual costs for police, fire, and rescue services supplied, unless otherwise reimbursed, to said 16
60	60	corporation commencing March 1, 2014; 17
61	61	(9) Estates, persons, and families of the president and professors for the time being of 18
62	62	Brown University for not more than ten thousand dollars ($10,000) for each officer, the officer’s 19
63	63	estate, person, and family included, but only to the extent that any person had claimed and utilized 20
64	64	the exemption prior to, and for a period ending, either on or after December 31, 1996; 21
65	65	(10) Property especially exempt by charter unless the exemption has been waived in whole 22
66	66	or in part; 23
67	67	(11) Lots of land exclusively for burial grounds; 24
68	68	(12) Property, real and personal, held for, or by, an incorporated library, society, or any 25
69	69	free public library, or any free public library society, so far as the property is held exclusively for 26
70	70	library purposes, or for the aid or support of the aged poor, or poor friendless children, or the poor 27
71	71	generally, or for a nonprofit hospital for the sick or disabled; 28
72	72	(13) Real or personal estate belonging to, or held in trust for, the benefit of incorporated 29
73	73	organizations of veterans of any war in which the United States has been engaged, the parent body 30
74	74	of which has been incorporated by act of Congress, to the extent of four hundred thousand dollars 31
75	75	($400,000) if actually used and occupied by the association; provided, that the city council of the 32
76	76	city of Cranston may by ordinance exempt the real or personal estate as previously described in 33
77	77	this subdivision located within the city of Cranston to the extent of five hundred thousand dollars 34
78	78
79	79
80	80	LC001655 - Page 3 of 39
81	81	($500,000); 1
82	82	(14) Property, real and personal, held for, or by, the fraternal corporation, association, or 2
83	83	body created to build and maintain a building or buildings for its meetings or the meetings of the 3
84	84	general assembly of its members, or subordinate bodies of the fraternity, and for the 4
85	85	accommodation of other fraternal bodies or associations, the entire net income of which real and 5
86	86	personal property is exclusively applied or to be used to build, furnish, and maintain an asylum or 6
87	87	asylums, a home or homes, a school or schools, for the free education or relief of the members of 7
88	88	the fraternity, or the relief, support, and care of worthy and indigent members of the fraternity, their 8
89	89	wives, widows, or orphans, and any fund given or held for the purpose of public education, 9
90	90	almshouses, and the land and buildings used in connection therewith; 10
91	91	(15) Real estate and personal property of any incorporated volunteer fire engine company 11
92	92	or incorporated volunteer ambulance or rescue corps in active service; 12
93	93	(16) The estate of any person who, in the judgment of the assessors, is unable from infirmity 13
94	94	or poverty to pay the tax; provided, that in the towns of Burrillville and West Greenwich, the tax 14
95	95	shall constitute a lien for five (5) years on the property where the owner is entitled to the exemption. 15
96	96	At the expiration of five (5) years, the lien shall be abated in full. Provided, if the property is sold 16
97	97	or conveyed, or if debt secured by the property is refinanced during the five-year (5) period, the 17
98	98	lien immediately becomes due and payable; any person claiming the exemption aggrieved by an 18
99	99	adverse decision of an assessor shall appeal the decision to the local board of tax review and 19
100	100	thereafter according to the provisions of § 44-5-26; 20
101	101	(17) Household furniture and family stores of a housekeeper in the whole, including 21
102	102	clothing, bedding, and other white goods, books, and all other tangible personal property items that 22
103	103	are common to the normal household; 23
104	104	(18) Improvements made to any real property to provide a shelter and fallout protection 24
105	105	from nuclear radiation, to the amount of one thousand five hundred dollars ($1,500); provided, that 25
106	106	the improvements meet applicable standards for shelter construction established, from time to time, 26
107	107	by the Rhode Island emergency management agency. The improvements are deemed to comply 27
108	108	with the provisions of any building code or ordinance with respect to the materials or the methods 28
109	109	of construction used and any shelter or its establishment is deemed to comply with the provisions 29
110	110	of any zoning code or ordinance; 30
111	111	(19) Aircraft for which the fee required by § 1-4-6 has been paid to the tax administrator; 31
112	112	(20) Manufacturer’s inventory. 32
113	113	(i) For the purposes of §§ 44-4-10, 44-5-3, 44-5-20, and 44-5-38, a person is deemed to be 33
114	114	a manufacturer within a city or town within this state if that person uses any premises, room, or 34
115	115
116	116
117	117	LC001655 - Page 4 of 39
118	118	place in it primarily for the purpose of transforming raw materials into a finished product for trade 1
119	119	through any or all of the following operations: adapting, altering, finishing, making, and 2
120	120	ornamenting; provided, that public utilities; non-regulated power producers commencing 3
121	121	commercial operation by selling electricity at retail or taking title to generating facilities on or after 4
122	122	July 1, 1997; building and construction contractors; warehousing operations, including distribution 5
123	123	bases or outlets of out-of-state manufacturers; and fabricating processes incidental to warehousing 6
124	124	or distribution of raw materials, such as alteration of stock for the convenience of a customer; are 7
125	125	excluded from this definition; 8
126	126	(ii) For the purposes of this section and §§ 44-4-10 and 44-5-38, the term “manufacturer’s 9
127	127	inventory,” or any similar term, means and includes the manufacturer’s raw materials, the 10
128	128	manufacturer’s work in process, and finished products manufactured by the manufacturer in this 11
129	129	state, and not sold, leased, or traded by the manufacturer or its title or right to possession divested; 12
130	130	provided, that the term does not include any finished products held by the manufacturer in any retail 13
131	131	store or other similar selling place operated by the manufacturer whether or not the retail 14
132	132	establishment is located in the same building in which the manufacturer operates the manufacturing 15
133	133	plant; 16
134	134	(iii) For the purpose of § 44-11-2, a “manufacturer” is a person whose principal business 17
135	135	in this state consists of transforming raw materials into a finished product for trade through any or 18
136	136	all of the operations described in paragraph (i) of this subdivision. A person will be deemed to be 19
137	137	principally engaged if the gross receipts that person derived from the manufacturing operations in 20
138	138	this state during the calendar year or fiscal year mentioned in § 44-11-1 amounted to more than 21
139	139	fifty percent (50%) of the total gross receipts that person derived from all the business activities in 22
140	140	which that person engaged in this state during the taxable year. For the purpose of computing the 23
141	141	percentage, gross receipts derived by a manufacturer from the sale, lease, or rental of finished 24
142	142	products manufactured by the manufacturer in this state, even though the manufacturer’s store or 25
143	143	other selling place may be at a different location from the location of the manufacturer’s 26
144	144	manufacturing plant in this state, are deemed to have been derived from manufacturing; 27
145	145	(iv) Within the meaning of the preceding paragraphs of this subdivision, the term 28
146	146	“manufacturer” also includes persons who are principally engaged in any of the general activities 29
147	147	coded and listed as establishments engaged in manufacturing in the Standard Industrial 30
148	148	Classification Manual prepared by the Technical Committee on Industrial Classification, Office of 31
149	149	Statistical Standards, Executive Office of the President, United States Bureau of the Budget, as 32
150	150	revised from time to time, but eliminating as manufacturers those persons, who, because of their 33
151	151	limited type of manufacturing activities, are classified in the manual as falling within the trade 34
152	152
153	153
154	154	LC001655 - Page 5 of 39
155	155	rather than an industrial classification of manufacturers. Among those thus eliminated, and 1
156	156	accordingly also excluded as manufacturers within the meaning of this paragraph, are persons 2
157	157	primarily engaged in selling, to the general public, products produced on the premises from which 3
158	158	they are sold, such as neighborhood bakeries, candy stores, ice cream parlors, shade shops, and 4
159	159	custom tailors, except, that a person who manufactures bakery products for sale primarily for home 5
160	160	delivery, or through one or more non-baking retail outlets, and whether or not retail outlets are 6
161	161	operated by the person, is a manufacturer within the meaning of this paragraph; 7
162	162	(v) The term “Person” means and includes, as appropriate, a person, partnership, or 8
163	163	corporation; and 9
164	164	(vi) The department of revenue shall provide to the local assessors any assistance that is 10
165	165	necessary in determining the proper application of the definitions in this subdivision; 11
166	166	(21) Real and tangible personal property acquired to provide a treatment facility used 12
167	167	primarily to control the pollution or contamination of the waters or the air of the state, as defined 13
168	168	in chapter 12 of title 46 and chapter 25 of title 23, respectively, the facility having been constructed, 14
169	169	reconstructed, erected, installed, or acquired in furtherance of federal or state requirements or 15
170	170	standards for the control of water or air pollution or contamination, and certified as approved in an 16
171	171	order entered by the director of environmental management. The property is exempt as long as it is 17
172	172	operated properly in compliance with the order of approval of the director of environmental 18
173	173	management; provided, that any grant of the exemption by the director of environmental 19
174	174	management in excess of ten (10) years is approved by the city or town in which the property is 20
175	175	situated. This provision applies only to water and air pollution control properties and facilities 21
176	176	installed for the treatment of waste waters and air contaminants resulting from industrial 22
177	177	processing; furthermore, it applies only to water or air pollution control properties and facilities 23
178	178	placed in operation for the first time after April 13, 1970; 24
179	179	(22) Manufacturing machinery and equipment acquired or used by a manufacturer after 25
180	180	December 31, 1974. Manufacturing machinery and equipment is defined as: 26
181	181	(i) Machinery and equipment used exclusively in the actual manufacture or conversion of 27
182	182	raw materials or goods in the process of manufacture by a manufacturer, as defined in subdivision 28
183	183	(20), and machinery, fixtures, and equipment used exclusively by a manufacturer for research and 29
184	184	development or for quality assurance of its manufactured products; 30
185	185	(ii) Machinery and equipment that is partially used in the actual manufacture or conversion 31
186	186	of raw materials or goods in process of manufacture by a manufacturer, as defined in subdivision 32
187	187	(20), and machinery, fixtures, and equipment used by a manufacturer for research and development 33
188	188	or for quality assurance of its manufactured products, to the extent to which the machinery and 34
189	189
190	190
191	191	LC001655 - Page 6 of 39
192	192	equipment is used for the manufacturing processes, research and development, or quality assurance. 1
193	193	In the instances where machinery and equipment is used in both manufacturing and/or research and 2
194	194	development and/or quality assurance activities and non-manufacturing activities, the assessment 3
195	195	on machinery and equipment is prorated by applying the percentage of usage of the equipment for 4
196	196	the manufacturing, research and development, and quality-assurance activity to the value of the 5
197	197	machinery and equipment for purposes of taxation, and the portion of the value used for 6
198	198	manufacturing, research and development, and quality assurance is exempt from taxation. The 7
199	199	burden of demonstrating this percentage usage of machinery and equipment for manufacturing and 8
200	200	for research and development and/or quality assurance of its manufactured products rests with the 9
201	201	manufacturer; and 10
202	202	(iii) Machinery and equipment described in §§ 44-18-30(7) and 44-18-30(22) that was 11
203	203	purchased after July 1, 1997; provided that the city or town council of the city or town in which the 12
204	204	machinery and equipment is located adopts an ordinance exempting the machinery and equipment 13
205	205	from taxation. For purposes of this subsection, city councils and town councils of any municipality 14
206	206	may, by ordinance, wholly or partially exempt from taxation the machinery and equipment 15
207	207	discussed in this subsection for the period of time established in the ordinance and may, by 16
208	208	ordinance, establish the procedures for taxpayers to avail themselves of the benefit of any 17
209	209	exemption permitted under this section; provided, that the ordinance does not apply to any 18
210	210	machinery or equipment of a business, subsidiary, or any affiliated business that locates or relocates 19
211	211	from a city or town in this state to another city or town in the state; 20
212	212	(23) Precious metal bullion, meaning any elementary metal that has been put through a 21
213	213	process of melting or refining, and that is in a state or condition that its value depends upon its 22
214	214	content and not its form. The term does not include fabricated precious metal that has been 23
215	215	processed or manufactured for some one or more specific and customary industrial, professional, 24
216	216	or artistic uses; 25
217	217	(24) Hydroelectric power-generation equipment, which includes, but is not limited to, 26
218	218	turbines, generators, switchgear, controls, monitoring equipment, circuit breakers, transformers, 27
219	219	protective relaying, bus bars, cables, connections, trash racks, headgates, and conduits. The 28
220	220	hydroelectric power-generation equipment must have been purchased after July 1, 1979, and 29
221	221	acquired or used by a person or corporation who or that owns or leases a dam and utilizes the 30
222	222	equipment to generate hydroelectric power; 31
223	223	(25) Subject to authorization by formal action of the council of any city or town, any real 32
224	224	or personal property owned by, held in trust for, or leased to an organization incorporated under 33
225	225	chapter 6 of title 7, as amended, or an organization meeting the definition of “charitable trust” set 34
226	226
227	227
228	228	LC001655 - Page 7 of 39
229	229	out in § 18-9-4, as amended, or an organization incorporated under the not-for-profits statutes of 1
230	230	another state or the District of Columbia, the purpose of which is the conserving of open space, as 2
231	231	that term is defined in chapter 36 of title 45, as amended, provided the property is used exclusively 3
232	232	for the purposes of the organization; 4
233	233	(26) Tangible personal property, the primary function of which is the recycling, reuse, or 5
234	234	recovery of materials (other than precious metals, as defined in § 44-18-30(24)(ii) and (iii)), from, 6
235	235	or the treatment of “hazardous wastes,” as defined in § 23-19.1-4, where the “hazardous wastes” 7
236	236	are generated primarily by the same taxpayer and where the personal property is located at, in, or 8
237	237	adjacent to a generating facility of the taxpayer. The taxpayer may, but need not, procure an order 9
238	238	from the director of the department of environmental management certifying that the tangible 10
239	239	personal property has this function, which order effects a conclusive presumption that the tangible 11
240	240	personal property qualifies for the exemption under this subdivision. If any information relating to 12
241	241	secret processes or methods of manufacture, production, or treatment is disclosed to the department 13
242	242	of environmental management only to procure an order, and is a “trade secret” as defined in § 28-14
243	243	21-10(b), it shall not be open to public inspection or publicly disclosed unless disclosure is 15
244	244	otherwise required under chapter 21 of title 28 or chapter 24.4 of title 23; 16
245	245	(27) Motorboats as defined in § 46-22-2 for which the annual fee required in § 46-22-4 has 17
246	246	been paid; 18
247	247	(28) Real and personal property of the Providence Performing Arts Center, a non-business 19
248	248	corporation as of December 31, 1986; 20
249	249	(29) Tangible personal property owned by, and used exclusively for the purposes of, any 21
250	250	religious organization located in the city of Cranston; 22
251	251	(30) Real and personal property of the Travelers Aid Society of Rhode Island, a nonprofit 23
252	252	corporation, the Union Mall Real Estate Corporation, and any limited partnership or limited liability 24
253	253	company that is formed in connection with, or to facilitate the acquisition of, the Providence YMCA 25
254	254	Building; 26
255	255	(31) Real and personal property of Meeting Street Center or MSC Realty, Inc., both not-27
256	256	for-profit Rhode Island corporations, and any other corporation, limited partnership, or limited 28
257	257	liability company that is formed in connection with, or to facilitate the acquisition of, the properties 29
258	258	designated as the Meeting Street National Center of Excellence on Eddy Street in Providence, 30
259	259	Rhode Island; 31
260	260	(32) The buildings, personal property, and land upon which the buildings stand, located on 32
261	261	Pomham Island, East Providence, currently identified as Assessor’s Map 211, Block 01, Parcel 33
262	262	001.00, that consists of approximately twenty-one thousand three hundred (21,300) square feet and 34
263	263
264	264
265	265	LC001655 - Page 8 of 39
266	266	is located approximately eight hundred sixty feet (860′), more or less, from the shore, and limited 1
267	267	exclusively to these said buildings, personal estate and land, provided that said property is owned 2
268	268	by a qualified 501(c)(3) organization, such as the American Lighthouse Foundation, and is used 3
269	269	exclusively for a lighthouse; 4
270	270	(33) The Stadium Theatre Performing Arts Centre building located in Monument Square, 5
271	271	Woonsocket, Rhode Island, so long as said Stadium Theatre Performing Arts Center is owned by 6
272	272	the Stadium Theatre Foundation, a Rhode Island nonprofit corporation; 7
273	273	(34) Real and tangible personal property of St. Mary Academy — Bay View, located in 8
274	274	East Providence, Rhode Island; 9
275	275	(35) Real and personal property of East Bay Community Action Program and its 10
276	276	predecessor, Self Help, Inc; provided, that the organization is qualified as a tax-exempt corporation 11
277	277	under § 501(c)(3) of the United States Internal Revenue Code; 12
278	278	(36) Real and personal property located within the city of East Providence of the Columbus 13
279	279	Club of East Providence, a Rhode Island charitable nonprofit corporation; 14
280	280	(37) Real and personal property located within the city of East Providence of the Columbus 15
281	281	Club of Barrington, a Rhode Island charitable nonprofit corporation; 16
282	282	(38) Real and personal property located within the city of East Providence of Lodge 2337 17
283	283	BPO Elks, a Rhode Island nonprofit corporation; 18
284	284	(39) Real and personal property located within the city of East Providence of the St. 19
285	285	Andrews Lodge No. 39, a Rhode Island charitable nonprofit corporation; 20
286	286	(40) Real and personal property located within the city of East Providence of the Trustees 21
287	287	of Methodist Health and Welfare service a/k/a United Methodist Elder Care, a Rhode Island 22
288	288	nonprofit corporation; 23
289	289	(41) Real and personal property located on the first floor of 90 Leonard Avenue within the 24
290	290	city of East Providence of the Zion Gospel Temple, Inc., a religious nonprofit corporation; 25
291	291	(42) Real and personal property located within the city of East Providence of the Cape 26
292	292	Verdean Museum Exhibit, a Rhode Island nonprofit corporation; 27
293	293	(43) The real and personal property owned by a qualified 501(c)(3) organization that is 28
294	294	affiliated and in good standing with a national, congressionally chartered organization and thereby 29
295	295	adheres to that organization’s standards and provides activities designed for recreational, 30
296	296	educational, and character building purposes for children from ages six (6) years to seventeen (17) 31
297	297	years; 32
298	298	(44) Real and personal property of the Rhode Island Philharmonic Orchestra and Music 33
299	299	School; provided, that the organization is qualified as a tax-exempt corporation under § 501(c)(3) 34
300	300
301	301
302	302	LC001655 - Page 9 of 39
303	303	of the United States Internal Revenue Code; 1
304	304	(45) The real and personal property located within the town of West Warwick at 211 2
305	305	Cowesett Avenue, Plat 29-Lot 25, which consists of approximately twenty-eight thousand seven 3
306	306	hundred fifty (28,750) square feet and is owned by the Station Fire Memorial Foundation of East 4
307	307	Greenwich, a Rhode Island nonprofit corporation; 5
308	308	(46) Real and personal property of the Comprehensive Community Action Program, a 6
309	309	qualified tax-exempt corporation under § 501(c)(3) of the United States Internal Revenue Code; 7
310	310	(47) Real and personal property located at 52 Plain Street, within the city of Pawtucket of 8
311	311	the Pawtucket Youth Soccer Association, a Rhode Island nonprofit corporation; 9
312	312	(48) Renewable energy resources, as defined in § 39-26-5, used in residential systems and 10
313	313	associated equipment used therewith in service after December 31, 2015; 11
314	314	(49) Renewable energy resources, as defined in § 39-26-5, if employed by a manufacturer, 12
315	315	as defined in subsection (a) of this section, shall be exempt from taxation in accordance with 13
316	316	subsection (a) of this section; 14
317	317	(50) Real and personal property located at 415 Tower Hill Road within the town of North 15
318	318	Kingstown, of South County Community Action, Inc., a qualified tax-exempt corporation under § 16
319	319	501(c)(3) of the United States Internal Revenue Code; 17
320	320	(51) As an effort to promote business growth, tangible business or personal property, in 18
321	321	whole or in part, within the town of Charlestown’s community limits, subject to authorization by 19
322	322	formal action of the town council of the town of Charlestown; 20
323	323	(52) All real and personal property located at 1300 Frenchtown Road, within the town of 21
324	324	East Greenwich, identified as assessor’s map 027, plat 019, lot 071, and known as the New England 22
325	325	Wireless and Steam Museum, Inc., a qualified tax-exempt corporation under § 501(c)(3) of the 23
326	326	United States Internal Revenue Code; 24
327	327	(53) Real and tangible personal property of Mount Saint Charles Academy located within 25
328	328	the city of Woonsocket, specifically identified as the following assessor’s plats and lots: Logee 26
329	329	Street, plat 23, lot 62, Logee Street, plat 24, lots 304 and 305; Welles Street, plat 23, lot 310; 27
330	330	Monroe Street, plat 23, lot 312; and Roberge Avenue, plat 24, lot 47; 28
331	331	(54) Real and tangible personal property of Steere House, a Rhode Island nonprofit 29
332	332	corporation, located in Providence, Rhode Island; 30
333	333	(55) Real and personal property located within the town of West Warwick of Tides Family 31
334	334	Services, Inc., a Rhode Island nonprofit corporation; 32
335	335	(56) Real and personal property of Tides Family Services, Inc., a Rhode Island nonprofit 33
336	336	corporation, located in the city of Pawtucket at 242 Dexter Street, plat 44, lot 444; 34
337	337
338	338
339	339	LC001655 - Page 10 of 39
340	340	(57) Real and personal property located within the town of Middletown of Lucy’s Hearth, 1
341	341	a Rhode Island nonprofit corporation; 2
342	342	(58) Real and tangible personal property of Habitat for Humanity of Rhode Island—3
343	343	Greater Providence, Inc., a Rhode Island nonprofit corporation, located in Providence, Rhode 4
344	344	Island; 5
345	345	(59) Real and personal property of the Artic Playhouse, a Rhode Island nonprofit 6
346	346	corporation, located in the town of West Warwick at 1249 Main Street; 7
347	347	(60) Real and personal property located at 321 Main Street, within the town of South 8
348	348	Kingstown, of the Contemporary Theatre Company, a qualified, tax-exempt corporation under § 9
349	349	501(c)(3) of the United States Internal Revenue Code; 10
350	350	(61) Real and personal property of The Samaritans, Inc., a Rhode Island nonprofit § 11
351	351	501(c)(3) corporation located at 67 Park Place, Pawtucket, Rhode Island, to the extent the city 12
352	352	council of Pawtucket may from time to time determine; 13
353	353	(62) Real and personal property of North Kingstown, Exeter Animal Protection League, 14
354	354	Inc., dba “Pet Refuge,” 500 Stony Lane, a Rhode Island nonprofit corporation, located in North 15
355	355	Kingstown, Rhode Island; 16
356	356	(63) Real and personal property located within the city of East Providence of Foster 17
357	357	Forward (formerly the Rhode Island Foster Parents Association), a Rhode Island charitable 18
358	358	nonprofit corporation; 19
359	359	(64) Real and personal property located at 54 Kelly Avenue within the town of East 20
360	360	Providence, of the Associated Radio Amateurs of Southern New England, a Rhode Island nonprofit 21
361	361	corporation; 22
362	362	(65) Real and tangible personal property of Providence Country Day School, a Rhode 23
363	363	Island nonprofit corporation, located in East Providence, Rhode Island and further identified as plat 24
364	364	406, block 6, lot 6, and plat 506, block 1, lot 8; 25
365	365	(66) As an effort to promote business growth, tangible business or personal property, in 26
366	366	whole or in part, within the town of Bristol’s community limits, subject to authorization by formal 27
367	367	action of the town council of the town of Bristol; 28
368	368	(67) Real and tangible personal property of the Heritage Harbor Foundation, a Rhode 29
369	369	Island nonprofit corporation, located at 1445 Wampanoag Trail, Suites 103 and 201, within the city 30
370	370	of East Providence; 31
371	371	(68) Real property of Ocean State Community Wellness, Inc., a qualified tax-exempt 32
372	372	corporation under § 501(c)(3) of the United States Internal Revenue Code, located in North 33
373	373	Kingstown, Rhode Island, with a physical address of 7450 Post Road, and further identified as plat 34
374	374
375	375
376	376	LC001655 - Page 11 of 39
377	377	108, lot 83; 1
378	378	(69) Real and tangible personal property of St. John Baptist De La Salle Institute, d/b/a La 2
379	379	Salle Academy, a Rhode Island domestic nonprofit corporation, located in Providence, Rhode 3
380	380	Island denominated at the time this subsection was adopted as Plat 83 Lot 276 by the tax assessor 4
381	381	for the city of Providence comprising approximately 26.08 acres of land along with all buildings 5
382	382	and improvements that have been or may be made; 6
383	383	(70) Real and tangible personal property of The Providence Community Health Centers, 7
384	384	Inc., a Rhode Island domestic nonprofit corporation, located in Providence, Rhode Island; 8
385	385	(71) In the city of Central Falls and the city of Pawtucket, real property and tangible 9
386	386	personal property located on or in the premise acquired or leased by a railroad entity and for the 10
387	387	purpose of providing boarding and disembarking of railroad passengers and the supporting 11
388	388	passenger railroad operations and services. For the purpose of this section, a railroad entity shall be 12
389	389	any incorporated entity that has been duly authorized by the Rhode Island public utilities 13
390	390	commission to provide passenger railroad services; 14
391	391	(72) Real and tangible personal property of the American Legion Riverside Post Holding 15
392	392	Company, d/b/a American Legion Post 10, a Rhode Island nonprofit corporation, located at 830 16
393	393	Willet Avenue, within the city of East Providence on Map 513, Block 27, Parcel 001.00 as long as 17
394	394	said property is owned by American Legion Post 10; 18
395	395	(73) Real and tangible personal property of the Holy Rosary Band Society, a Rhode Island 19
396	396	nonprofit corporation, located at 328 Taunton Avenue, within the city of East Providence on Map 20
397	397	306, Block 01, Parcel 012.00; 21
398	398	(74) Real and tangible personal property of Foster Forward, a Rhode Island domestic 22
399	399	nonprofit corporation, located within the city of Pawtucket, at 16 North Bend Street, and further 23
400	400	identified as assessor’s plat 21, lot 312; 24
401	401	(75) Real and tangible personal property of the Old and Ancient Rowers Society of Rhode 25
402	402	Island, a Rhode Island domestic nonprofit corporation, located at 166 Walmsley Lane, within the 26
403	403	town of North Kingstown on Plat 004/Lot 019; 27
404	404	(76) Real and tangible personal property of the Rhode Island Public Health Foundation, a 28
405	405	domestic nonprofit corporation or any other entity formed by the Rhode Island Public Health 29
406	406	Foundation in connection with, or to facilitate the acquisition of, one property to be owned by the 30
407	407	Rhode Island Public Health Foundation or such entity, located in the city of Providence; 31
408	408	(77) Real and tangible personal property of the Manissean Tribal Council, a Rhode Island 32
409	409	nonprofit corporation, located in the town of New Shoreham, Rhode Island; 33
410	410	(78) Real and tangible personal property of Sophia Academy located at 582 Elmwood 34
411	411
412	412
413	413	LC001655 - Page 12 of 39
414	414	Avenue, the San Miguel Education Center located at 525 Branch Avenue, and the Community 1
415	415	Preparatory School, Inc. located at 135 Prairie Avenue, all of which are domestic nonprofit 2
416	416	corporations, and all of which are located within the city of Providence; and 3
417	417	(79) Real and tangible personal property of Cape Verdean Museum Exhibit, a Rhode Island 4
418	418	domestic nonprofit corporation, located at 617 Prospect Street, within the city of Pawtucket on 5
419	419	Assessors’ Plat 37, Lot 434.; and 6
420	420	(80) Real and tangible personal property of urban and small farmers. 7
421	421	(i) For purposes of this subsection: 8
422	422	(A) An “urban farmer” is a taxpayer that produces or grows food in a city or other heavily 9
423	423	populated areas; and 10
424	424	(B) A “small farmer” is a taxpayer that farms agricultural land up to five (5) acres. 11
425	425	(b) Except as provided below, when a city or town taxes a for-profit hospital facility, the 12
426	426	value of its real property shall be the value determined by the most recent full revaluation or 13
427	427	statistical property update performed by the city or town; provided, however, in the year a nonprofit 14
428	428	hospital facility converts to or otherwise becomes a for-profit hospital facility, or a for-profit 15
429	429	hospital facility is initially established, the value of the real property and personal property of the 16
430	430	for-profit hospital facility shall be determined by a valuation performed by the assessor for the 17
431	431	purpose of determining an initial assessed value of real and personal property, not previously taxed 18
432	432	by the city or town, as of the most recent date of assessment pursuant to § 44-5-1, subject to a right 19
433	433	of appeal by the for-profit hospital facility which shall be made to the city or town tax assessor with 20
434	434	a direct appeal from an adverse decision to the Rhode Island superior court business calendar. 21
435	435	A “for-profit hospital facility” includes all real and personal property affiliated with any 22
436	436	hospital as identified in an application filed pursuant to chapter 17 or 17.14 of title 23. 23
437	437	Notwithstanding the above, a city or town may enter into a stabilization agreement with a for-profit 24
438	438	hospital facility under § 44-3-9 or other laws specific to the particular city or town relating to 25
439	439	stabilization agreements. In a year in which a nonprofit hospital facility converts to, or otherwise 26
440	440	becomes, a for-profit hospital facility, or a for-profit hospital facility is otherwise established, in 27
441	441	that year only the amount levied by the city or town and/or the amount payable under the 28
442	442	stabilization agreement for that year related to the for-profit hospital facility shall not be counted 29
443	443	towards determining the maximum tax levy permitted under § 44-5-2. 30
444	444	(c) Notwithstanding any other provision of law to the contrary, in an effort to provide relief 31
445	445	for businesses, including small businesses, and to promote economic development, a city, town, or 32
446	446	fire district may establish an exemption for tangible personal property within its geographic limits 33
447	447	by formal action of the appropriate governing body within the city, town, or fire district, which 34
448	448
449	449
450	450	LC001655 - Page 13 of 39
451	451	exemptions shall be uniformly applied and in compliance with local tax classification requirements. 1
452	452	Exemptions established pursuant to this subsection shall conform to the requirements of § 44-5-2
453	453	12.2. 3
454	454	SECTION 2. Section 44-11-11 of the General Laws in Chapter 44-11 entitled "Business 4
455	455	Corporation Tax" is hereby amended to read as follows: 5
456	456	44-11-11. “Net income” defined. 6
457	457	(a)(1) “Net income” means, for any taxable year and for any corporate taxpayer, the taxable 7
458	458	income of the taxpayer for that taxable year under the laws of the United States, plus: 8
459	459	(i) Any interest not included in the taxable income; 9
460	460	(ii) Any specific exemptions; 10
461	461	(iii) The tax imposed by this chapter; 11
462	462	(iv) For any taxable year beginning on or after January 1, 2020, the amount of any Paycheck 12
463	463	Protection Program loan forgiven for federal income tax purposes as authorized by the Coronavirus 13
464	464	Aid, Relief, and Economic Security Act and/or the Consolidated Appropriations Act, 2021 and/or 14
465	465	any other subsequent federal stimulus relief packages enacted by law, to the extent that the amount 15
466	466	of the loan forgiven exceeds $250,000; and minus: 16
467	467	(v) Interest on obligations of the United States or its possessions, and other interest exempt 17
468	468	from taxation by this state; and 18
469	469	(vi) The federal net operating loss deduction.; and 19
470	470	(vii) Income from the production of food by urban and small farmers. 20
471	471	(A) For purposes of this subsection: 21
472	472	(I) An “urban farmer” is a taxpayer that produces or grows food in a city or other heavily 22
473	473	populated areas; and 23
474	474	(II) A “small farmer” is a taxpayer that farms agricultural land up to five (5) acres. 24
475	475	(2) All binding federal elections made by or on behalf of the taxpayer applicable either 25
476	476	directly or indirectly to the determination of taxable income shall be binding on the taxpayer except 26
477	477	where this chapter or its attendant regulations specifically modify or provide otherwise. Rhode 27
478	478	Island taxable income shall not include the “gross-up of dividends” required by the federal Internal 28
479	479	Revenue Code to be taken into taxable income in connection with the taxpayer’s election of the 29
480	480	foreign tax credit. 30
481	481	(b) A net operating loss deduction shall be allowed, which shall be the same as the net 31
482	482	operating loss deduction allowed under 26 U.S.C. § 172, except that: 32
483	483	(1) Any net operating loss included in determining the deduction shall be adjusted to reflect 33
484	484	the inclusions and exclusions from entire net income required by subsection (a) of this section and 34
485	485
486	486
487	487	LC001655 - Page 14 of 39
488	488	§ 44-11-11.1; 1
489	489	(2) The deduction shall not include any net operating loss sustained during any taxable year 2
490	490	in which the taxpayer was not subject to the tax imposed by this chapter; and 3
491	491	(3) The deduction shall not exceed the deduction for the taxable year allowable under 26 4
492	492	U.S.C. § 172; provided, that the deduction for a taxable year may not be carried back to any other 5
493	493	taxable year for Rhode Island purposes but shall only be allowable on a carry forward basis for the 6
494	494	five (5) succeeding taxable years. 7
495	495	(c) “Domestic international sales corporations” (referred to as DISCs), for the purposes of 8
496	496	this chapter, will be treated as they are under federal income tax law and shall not pay the amount 9
497	497	of the tax computed under § 44-11-2(a). Any income to shareholders of DISCs is to be treated in 10
498	498	the same manner as it is treated under federal income tax law as it exists on December 31, 1984. 11
499	499	(d) A corporation that qualifies as a “foreign sales corporation” (FSC) under the provisions 12
500	500	of subchapter N, 26 U.S.C. § 861 et seq., and that has in effect for the entire taxable year a valid 13
501	501	election under federal law to be treated as a FSC, shall not pay the amount of the tax computed 14
502	502	under § 44-11-2(a). Any income to shareholders of FSCs is to be treated in the same manner as it 15
503	503	is treated under federal income tax law as it exists on January 1, 1985. 16
504	504	(e) For purposes of a corporation’s state tax liability, any deduction to income allowable 17
505	505	under 26 U.S.C. § 1400Z-2(c) may be claimed in the case of any investment held by the taxpayer 18
506	506	for at least seven years. The division of taxation shall promulgate, in its discretion, rules and 19
507	507	regulations relative to the accelerated application of deductions under 26 U.S.C. § 1400Z-2(c). 20
508	508	SECTION 3. Section 44-18-30 of the General Laws in Chapter 44-18 entitled "Sales and 21
509	509	Use Taxes — Liability and Computation" is hereby amended to read as follows: 22
510	510	44-18-30. Gross receipts exempt from sales and use taxes. 23
511	511	There are exempted from the taxes imposed by this chapter the following gross receipts: 24
512	512	(1) Sales and uses beyond constitutional power of state. From the sale and from the storage, 25
513	513	use, or other consumption in this state of tangible personal property the gross receipts from the sale 26
514	514	of which, or the storage, use, or other consumption of which, this state is prohibited from taxing 27
515	515	under the Constitution of the United States or under the constitution of this state. 28
516	516	(2) Newspapers. 29
517	517	(i) From the sale and from the storage, use, or other consumption in this state of any 30
518	518	newspaper. 31
519	519	(ii) “Newspaper” means an unbound publication printed on newsprint that contains news, 32
520	520	editorial comment, opinions, features, advertising matter, and other matters of public interest. 33
521	521	(iii) “Newspaper” does not include a magazine, handbill, circular, flyer, sales catalog, or 34
522	522
523	523
524	524	LC001655 - Page 15 of 39
525	525	similar item unless the item is printed for, and distributed as, a part of a newspaper. 1
526	526	(3) School meals. From the sale and from the storage, use, or other consumption in this 2
527	527	state of meals served by public, private, or parochial schools, school districts, colleges, universities, 3
528	528	student organizations, and parent-teacher associations to the students or teachers of a school, 4
529	529	college, or university whether the meals are served by the educational institutions or by a food 5
530	530	service or management entity under contract to the educational institutions. 6
531	531	(4) Containers. 7
532	532	(i) From the sale and from the storage, use, or other consumption in this state of: 8
533	533	(A) Non-returnable containers, including boxes, paper bags, and wrapping materials that 9
534	534	are biodegradable and all bags and wrapping materials utilized in the medical and healing arts, 10
535	535	when sold without the contents to persons who place the contents in the container and sell the 11
536	536	contents with the container. 12
537	537	(B) Containers when sold with the contents if the sale price of the contents is not required 13
538	538	to be included in the measure of the taxes imposed by this chapter. 14
539	539	(C) Returnable containers when sold with the contents in connection with a retail sale of 15
540	540	the contents or when resold for refilling. 16
541	541	(D) Keg and barrel containers, whether returnable or not, when sold to alcoholic beverage 17
542	542	producers who place the alcoholic beverages in the containers. 18
543	543	(ii) As used in this subdivision, the term “returnable containers” means containers of a kind 19
544	544	customarily returned by the buyer of the contents for reuse. All other containers are “non-returnable 20
545	545	containers.” 21
546	546	(5)(i) Charitable, educational, and religious organizations. From the sale to, as in defined 22
547	547	in this section, and from the storage, use, and other consumption in this state, or any other state of 23
548	548	the United States of America, of tangible personal property by hospitals not operated for a profit; 24
549	549	“educational institutions” as defined in subdivision (18) not operated for a profit; churches, 25
550	550	orphanages, and other institutions or organizations operated exclusively for religious or charitable 26
551	551	purposes; interest-free loan associations not operated for profit; nonprofit, organized sporting 27
552	552	leagues and associations and bands for boys and girls under the age of nineteen (19) years; the 28
553	553	following vocational student organizations that are state chapters of national vocational student 29
554	554	organizations: Distributive Education Clubs of America (DECA); Future Business Leaders of 30
555	555	America, Phi Beta Lambda (FBLA/PBL); Future Farmers of America (FFA); Future Homemakers 31
556	556	of America/Home Economics Related Occupations (FHA/HERD); Vocational Industrial Clubs of 32
557	557	America (VICA); organized nonprofit golden age and senior citizens clubs for men and women; 33
558	558	and parent-teacher associations; and from the sale, storage, use, and other consumption in this state, 34
559	559
560	560
561	561	LC001655 - Page 16 of 39
562	562	of and by the Industrial Foundation of Burrillville, a Rhode Island domestic nonprofit corporation. 1
563	563	(ii) In the case of contracts entered into with the federal government, its agencies, or 2
564	564	instrumentalities, this state, or any other state of the United States of America, its agencies, any 3
565	565	city, town, district, or other political subdivision of the states; hospitals not operated for profit; 4
566	566	educational institutions not operated for profit; churches, orphanages, and other institutions or 5
567	567	organizations operated exclusively for religious or charitable purposes, the contractor may purchase 6
568	568	such materials and supplies (materials and/or supplies are defined as those that are essential to the 7
569	569	project) that are to be utilized in the construction of the projects being performed under the contracts 8
570	570	without payment of the tax. 9
571	571	(iii) The contractor shall not charge any sales or use tax to any exempt agency, institution, 10
572	572	or organization but shall in that instance provide his or her suppliers with certificates in the form 11
573	573	as determined by the division of taxation showing the reason for exemption and the contractor’s 12
574	574	records must substantiate the claim for exemption by showing the disposition of all property so 13
575	575	purchased. If any property is then used for a nonexempt purpose, the contractor must pay the tax 14
576	576	on the property used. 15
577	577	(6) Gasoline. From the sale and from the storage, use, or other consumption in this state 16
578	578	of: (i) Gasoline and other products taxed under chapter 36 of title 31 and (ii) Fuels used for the 17
579	579	propulsion of airplanes. 18
580	580	(7) Purchase for manufacturing purposes. 19
581	581	(i) From the sale and from the storage, use, or other consumption in this state of computer 20
582	582	software, tangible personal property, electricity, natural gas, artificial gas, steam, refrigeration, and 21
583	583	water, when the property or service is purchased for the purpose of being manufactured into a 22
584	584	finished product for resale and becomes an ingredient, component, or integral part of the 23
585	585	manufactured, compounded, processed, assembled, or prepared product, or if the property or 24
586	586	service is consumed in the process of manufacturing for resale computer software, tangible personal 25
587	587	property, electricity, natural gas, artificial gas, steam, refrigeration, or water. 26
588	588	(ii) “Consumed” means destroyed, used up, or worn out to the degree or extent that the 27
589	589	property cannot be repaired, reconditioned, or rendered fit for further manufacturing use. 28
590	590	(iii) “Consumed” includes mere obsolescence. 29
591	591	(iv) “Manufacturing” means and includes: manufacturing, compounding, processing, 30
592	592	assembling, preparing, or producing. 31
593	593	(v) “Process of manufacturing” means and includes all production operations performed in 32
594	594	the producing or processing room, shop, or plant, insofar as the operations are a part of and 33
595	595	connected with the manufacturing for resale of tangible personal property, electricity, natural gas, 34
596	596
597	597
598	598	LC001655 - Page 17 of 39
599	599	artificial gas, steam, refrigeration, or water and all production operations performed insofar as the 1
600	600	operations are a part of and connected with the manufacturing for resale of computer software. 2
601	601	(vi) “Process of manufacturing” does not mean or include administration operations such 3
602	602	as general office operations, accounting, collection, or sales promotion, nor does it mean or include 4
603	603	distribution operations that occur subsequent to production operations, such as handling, storing, 5
604	604	selling, and transporting the manufactured products, even though the administration and 6
605	605	distribution operations are performed by, or in connection with, a manufacturing business. 7
606	606	(8) State and political subdivisions. From the sale to, and from the storage, use, or other 8
607	607	consumption by, this state, any city, town, district, or other political subdivision of this state. Every 9
608	608	redevelopment agency created pursuant to chapter 31 of title 45 is deemed to be a subdivision of 10
609	609	the municipality where it is located. 11
610	610	(9) Food and food ingredients. From the sale and storage, use, or other consumption in this 12
611	611	state of food and food ingredients as defined in § 44-18-7.1(l). 13
612	612	For the purposes of this exemption “food and food ingredients” shall not include candy, 14
613	613	soft drinks, dietary supplements, alcoholic beverages, tobacco, food sold through vending 15
614	614	machines, or prepared food, as those terms are defined in § 44-18-7.1, unless the prepared food is: 16
615	615	(i) Sold by a seller whose primary NAICS classification is manufacturing in sector 311, 17
616	616	except sub-sector 3118 (bakeries); 18
617	617	(ii) Sold in an unheated state by weight or volume as a single item; 19
618	618	(iii) Bakery items, including: bread, rolls, buns, biscuits, bagels, croissants, pastries, 20
619	619	donuts, danish, cakes, tortes, pies, tarts, muffins, bars, cookies, tortillas; and 21
620	620	is not sold with utensils provided by the seller, including: plates, knives, forks, spoons, 22
621	621	glasses, cups, napkins, or straws. 23
622	622	(10) Medicines, drugs, and durable medical equipment. From the sale and from the storage, 24
623	623	use, or other consumption in this state, of: 25
624	624	(i) “Drugs” as defined in § 44-18-7.1(h)(i), sold on prescriptions, medical oxygen, and 26
625	625	insulin whether or not sold on prescription. For purposes of this exemption drugs shall not include 27
626	626	over-the-counter drugs and grooming and hygiene products as defined in § 44-18-7.1(h)(iii). 28
627	627	(ii) Durable medical equipment as defined in § 44-18-7.1(k) for home use only, including, 29
628	628	but not limited to: syringe infusers, ambulatory drug delivery pumps, hospital beds, convalescent 30
629	629	chairs, and chair lifts. Supplies used in connection with syringe infusers and ambulatory drug 31
630	630	delivery pumps that are sold on prescription to individuals to be used by them to dispense or 32
631	631	administer prescription drugs, and related ancillary dressings and supplies used to dispense or 33
632	632	administer prescription drugs, shall also be exempt from tax. 34
633	633
634	634
635	635	LC001655 - Page 18 of 39
636	636	(11) Prosthetic devices and mobility enhancing equipment. From the sale and from the 1
637	637	storage, use, or other consumption in this state, of prosthetic devices as defined in § 44-18-7.1(t), 2
638	638	sold on prescription, including, but not limited to: artificial limbs, dentures, spectacles, eyeglasses, 3
639	639	and artificial eyes; artificial hearing devices and hearing aids, whether or not sold on prescription; 4
640	640	and mobility enhancing equipment as defined in § 44-18-7.1(p), including wheelchairs, crutches, 5
641	641	and canes. 6
642	642	(12) Coffins, caskets, urns, shrouds and burial garments. From the sale and from the 7
643	643	storage, use, or other consumption in this state of coffins, caskets, burial containers, urns, urn liners, 8
644	644	urn vaults, grave liners, grave vaults, burial tent setups, prayer cards, shrouds, and other burial 9
645	645	garments that are ordinarily sold by a funeral director as part of the business of funeral directing. 10
646	646	(13) Motor vehicles sold to nonresidents. 11
647	647	(i) From the sale, subsequent to June 30, 1958, of a motor vehicle to a bona fide nonresident 12
648	648	of this state who does not register the motor vehicle in this state, whether the sale or delivery of the 13
649	649	motor vehicle is made in this state or at the place of residence of the nonresident. A motor vehicle 14
650	650	sold to a bona fide nonresident whose state of residence does not allow a like exemption to its 15
651	651	nonresidents is not exempt from the tax imposed under § 44-18-20. In that event, the bona fide 16
652	652	nonresident pays a tax to Rhode Island on the sale at a rate equal to the rate that would be imposed 17
653	653	in his or her state of residence not to exceed the rate that would have been imposed under § 44-18-18
654	654	20. Notwithstanding any other provisions of law, a licensed motor vehicle dealer shall add and 19
655	655	collect the tax required under this subdivision and remit the tax to the tax administrator under the 20
656	656	provisions of chapters 18 and 19 of this title. When a Rhode Island licensed, motor vehicle dealer 21
657	657	is required to add and collect the sales and use tax on the sale of a motor vehicle to a bona fide 22
658	658	nonresident as provided in this section, the dealer in computing the tax takes into consideration the 23
659	659	law of the state of the nonresident as it relates to the trade-in of motor vehicles. 24
660	660	(ii) The tax administrator, in addition to the provisions of §§ 44-19-27 and 44-19-28, may 25
661	661	require any licensed motor vehicle dealer to keep records of sales to bona fide nonresidents as the 26
662	662	tax administrator deems reasonably necessary to substantiate the exemption provided in this 27
663	663	subdivision, including the affidavit of a licensed motor vehicle dealer that the purchaser of the 28
664	664	motor vehicle was the holder of, and had in his or her possession a valid out-of-state motor vehicle 29
665	665	registration or a valid out-of-state driver’s license. 30
666	666	(iii) Any nonresident who registers a motor vehicle in this state within ninety (90) days of 31
667	667	the date of its sale to him or her is deemed to have purchased the motor vehicle for use, storage, or 32
668	668	other consumption in this state, and is subject to, and liable for, the use tax imposed under the 33
669	669	provisions of § 44-18-20. 34
670	670
671	671
672	672	LC001655 - Page 19 of 39
673	673	(14) Sales in public buildings by blind people. From the sale and from the storage, use, or 1
674	674	other consumption in all public buildings in this state of all products or wares by any person 2
675	675	licensed under § 40-9-11.1. 3
676	676	(15) Air and water pollution control facilities. From the sale, storage, use, or other 4
677	677	consumption in this state of tangible personal property or supplies acquired for incorporation into 5
678	678	or used and consumed in the operation of a facility, the primary purpose of which is to aid in the 6
679	679	control of the pollution or contamination of the waters or air of the state, as defined in chapter 12 7
680	680	of title 46 and chapter 23 of title 23, respectively, and that has been certified as approved for that 8
681	681	purpose by the director of environmental management. The director of environmental management 9
682	682	may certify to a portion of the tangible personal property or supplies acquired for incorporation 10
683	683	into those facilities or used and consumed in the operation of those facilities to the extent that that 11
684	684	portion has as its primary purpose the control of the pollution or contamination of the waters or air 12
685	685	of this state. As used in this subdivision, “facility” means any land, facility, device, building, 13
686	686	machinery, or equipment. 14
687	687	(16) Camps. From the rental charged for living quarters, or sleeping, or housekeeping 15
688	688	accommodations at camps or retreat houses operated by religious, charitable, educational, or other 16
689	689	organizations and associations mentioned in subsection (5), or by privately owned and operated 17
690	690	summer camps for children. 18
691	691	(17) Certain institutions. From the rental charged for living or sleeping quarters in an 19
692	692	institution licensed by the state for the hospitalization, custodial, or nursing care of human beings. 20
693	693	(18) Educational institutions. From the rental charged by any educational institution for 21
694	694	living quarters, or sleeping, or housekeeping accommodations or other rooms or accommodations 22
695	695	to any student or teacher necessitated by attendance at an educational institution. “Educational 23
696	696	institution” as used in this section means an institution of learning not operated for profit that is 24
697	697	empowered to confer diplomas, educational, literary, or academic degrees; that has a regular 25
698	698	faculty, curriculum, and organized body of pupils or students in attendance throughout the usual 26
699	699	school year; that keeps and furnishes to students and others records required and accepted for 27
700	700	entrance to schools of secondary, collegiate, or graduate rank; and no part of the net earnings of 28
701	701	which inures to the benefit of any individual. 29
702	702	(19) Motor vehicle and adaptive equipment for persons with disabilities. 30
703	703	(i) From the sale of: (A) Special adaptations; (B) The component parts of the special 31
704	704	adaptations; or (C) A specially adapted motor vehicle; provided that the owner furnishes to the tax 32
705	705	administrator an affidavit of a licensed physician to the effect that the specially adapted motor 33
706	706	vehicle is necessary to transport a family member with a disability or where the vehicle has been 34
707	707
708	708
709	709	LC001655 - Page 20 of 39
710	710	specially adapted to meet the specific needs of the person with a disability. This exemption applies 1
711	711	to not more than one motor vehicle owned and registered for personal, noncommercial use. 2
712	712	(ii) For the purpose of this subsection the term “special adaptations” includes, but is not 3
713	713	limited to: wheelchair lifts, wheelchair carriers, wheelchair ramps, wheelchair securements, hand 4
714	714	controls, steering devices, extensions, relocations, and crossovers of operator controls, power-5
715	715	assisted controls, raised tops or dropped floors, raised entry doors, or alternative signaling devices 6
716	716	to auditory signals. 7
717	717	(iii) From the sale of: (a) Special adaptations, (b) The component parts of the special 8
718	718	adaptations, for a “wheelchair accessible taxicab” as defined in § 39-14-1, and/or a “wheelchair 9
719	719	accessible public motor vehicle” as defined in § 39-14.1-1. 10
720	720	(iv) For the purpose of this subdivision the exemption for a “specially adapted motor 11
721	721	vehicle” means a use tax credit not to exceed the amount of use tax that would otherwise be due on 12
722	722	the motor vehicle, exclusive of any adaptations. The use tax credit is equal to the cost of the special 13
723	723	adaptations, including installation. 14
724	724	(20) Heating fuels. From the sale and from the storage, use, or other consumption in this 15
725	725	state of every type of heating fuel. 16
726	726	(21) Electricity and gas. From the sale and from the storage, use, or other consumption in 17
727	727	this state of electricity and gas. 18
728	728	(22) Manufacturing machinery and equipment. 19
729	729	(i) From the sale and from the storage, use, or other consumption in this state of tools, dies, 20
730	730	molds, machinery, equipment (including replacement parts), and related items to the extent used in 21
731	731	an industrial plant in connection with the actual manufacture, conversion, or processing of tangible 22
732	732	personal property, or to the extent used in connection with the actual manufacture, conversion, or 23
733	733	processing of computer software as that term is utilized in industry numbers 7371, 7372, and 7373 24
734	734	in the standard industrial classification manual prepared by the Technical Committee on Industrial 25
735	735	Classification, Office of Statistical Standards, Executive Office of the President, United States 26
736	736	Bureau of the Budget, as revised from time to time, to be sold, or that machinery and equipment 27
737	737	used in the furnishing of power to an industrial manufacturing plant. For the purposes of this 28
738	738	subdivision, “industrial plant” means a factory at a fixed location primarily engaged in the 29
739	739	manufacture, conversion, or processing of tangible personal property to be sold in the regular 30
740	740	course of business; 31
741	741	(ii) Machinery and equipment and related items are not deemed to be used in connection 32
742	742	with the actual manufacture, conversion, or processing of tangible personal property, or in 33
743	743	connection with the actual manufacture, conversion, or processing of computer software as that 34
744	744
745	745
746	746	LC001655 - Page 21 of 39
747	747	term is utilized in industry numbers 7371, 7372, and 7373 in the standard industrial classification 1
748	748	manual prepared by the Technical Committee on Industrial Classification, Office of Statistical 2
749	749	Standards, Executive Office of the President, United States Bureau of the Budget, as revised from 3
750	750	time to time, to be sold to the extent the property is used in administration or distribution operations; 4
751	751	(iii) Machinery and equipment and related items used in connection with the actual 5
752	752	manufacture, conversion, or processing of any computer software or any tangible personal property 6
753	753	that is not to be sold and that would be exempt under subdivision (7) or this subdivision if purchased 7
754	754	from a vendor or machinery and equipment and related items used during any manufacturing, 8
755	755	converting, or processing function is exempt under this subdivision even if that operation, function, 9
756	756	or purpose is not an integral or essential part of a continuous production flow or manufacturing 10
757	757	process; 11
758	758	(iv) Where a portion of a group of portable or mobile machinery is used in connection with 12
759	759	the actual manufacture, conversion, or processing of computer software or tangible personal 13
760	760	property to be sold, as previously defined, that portion, if otherwise qualifying, is exempt under 14
761	761	this subdivision even though the machinery in that group is used interchangeably and not otherwise 15
762	762	identifiable as to use. 16
763	763	(23) Trade-in value of motor vehicles. From the sale and from the storage, use, or other 17
764	764	consumption in this state of so much of the purchase price paid for a new or used automobile as is 18
765	765	allocated for a trade-in allowance on the automobile of the buyer given in trade to the seller, or of 19
766	766	the proceeds applicable only to the automobile as are received from the manufacturer of 20
767	767	automobiles for the repurchase of the automobile whether the repurchase was voluntary or not 21
768	768	towards the purchase of a new or used automobile by the buyer. For the purpose of this subdivision, 22
769	769	the word “automobile” means a private passenger automobile not used for hire and does not refer 23
770	770	to any other type of motor vehicle. 24
771	771	(24) Precious metal bullion. 25
772	772	(i) From the sale and from the storage, use, or other consumption in this state of precious 26
773	773	metal bullion, substantially equivalent to a transaction in securities or commodities. 27
774	774	(ii) For purposes of this subdivision, “precious metal bullion” means any elementary 28
775	775	precious metal that has been put through a process of smelting or refining, including, but not limited 29
776	776	to: gold, silver, platinum, rhodium, and chromium, and that is in a state or condition that its value 30
777	777	depends upon its content and not upon its form. 31
778	778	(iii) The term does not include fabricated precious metal that has been processed or 32
779	779	manufactured for some one or more specific and customary industrial, professional, or artistic uses. 33
780	780	(25) Commercial vessels. From sales made to a commercial ship, barge, or other vessel of 34
781	781
782	782
783	783	LC001655 - Page 22 of 39
784	784	fifty (50) tons burden or over, primarily engaged in interstate or foreign commerce, and from the 1
785	785	repair, alteration, or conversion of the vessels, and from the sale of property purchased for the use 2
786	786	of the vessels including provisions, supplies, and material for the maintenance and/or repair of the 3
787	787	vessels. 4
788	788	(26) Commercial fishing vessels. From the sale and from the storage, use, or other 5
789	789	consumption in this state of vessels and other watercraft that are in excess of five (5) net tons and 6
790	790	that are used exclusively for “commercial fishing,” as defined in this subdivision, and from the 7
791	791	repair, alteration, or conversion of those vessels and other watercraft, and from the sale of property 8
792	792	purchased for the use of those vessels and other watercraft including provisions, supplies, and 9
793	793	material for the maintenance and/or repair of the vessels and other watercraft and the boats nets, 10
794	794	cables, tackle, and other fishing equipment appurtenant to or used in connection with the 11
795	795	commercial fishing of the vessels and other watercraft. “Commercial fishing” means taking or 12
796	796	attempting to take any fish, shellfish, crustacea, or bait species with the intent of disposing of it for 13
797	797	profit or by sale, barter, trade, or in commercial channels. The term does not include subsistence 14
798	798	fishing, i.e., the taking for personal use and not for sale or barter; or sport fishing; but shall include 15
799	799	vessels and other watercraft with a Rhode Island party and charter boat license issued by the 16
800	800	department of environmental management pursuant to § 20-2-27.1 that meet the following criteria: 17
801	801	(i) The operator must have a current United States Coast Guard (U.S.C.G.) license to carry 18
802	802	passengers for hire; (ii) U.S.C.G. vessel documentation in the coast wide fishery trade; (iii) 19
803	803	U.S.C.G. vessel documentation as to proof of Rhode Island home port status or a Rhode Island boat 20
804	804	registration to prove Rhode Island home port status; and (iv) The vessel must be used as a 21
805	805	commercial passenger carrying fishing vessel to carry passengers for fishing. The vessel must be 22
806	806	able to demonstrate that at least fifty percent (50%) of its annual gross income derives from charters 23
807	807	or provides documentation of a minimum of one hundred (100) charter trips annually; and (v) The 24
808	808	vessel must have a valid Rhode Island party and charter boat license. The tax administrator shall 25
809	809	implement the provisions of this subdivision by promulgating rules and regulations relating thereto. 26
810	810	(27) Clothing and footwear. From the sales of articles of clothing, including footwear, 27
811	811	intended to be worn or carried on or about the human body for sales prior to October 1, 2012. 28
812	812	Effective October 1, 2012, the exemption will apply to the sales of articles of clothing, including 29
813	813	footwear, intended to be worn or carried on or about the human body up to two hundred and fifty 30
814	814	dollars ($250) of the sales price per item. For the purposes of this section, “clothing or footwear” 31
815	815	does not include clothing accessories or equipment or special clothing or footwear primarily 32
816	816	designed for athletic activity or protective use as these terms are defined in § 44-18-7.1(f). In 33
817	817	recognition of the work being performed by the streamlined sales and use tax governing board, 34
818	818
819	819
820	820	LC001655 - Page 23 of 39
821	821	upon passage of any federal law that authorizes states to require remote sellers to collect and remit 1
822	822	sales and use taxes, this unlimited exemption will apply as it did prior to October 1, 2012. The 2
823	823	unlimited exemption on sales of clothing and footwear shall take effect on the date that the state 3
824	824	requires remote sellers to collect and remit sales and use taxes. 4
825	825	(28) Water for residential use. From the sale and from the storage, use, or other 5
826	826	consumption in this state of water furnished for domestic use by occupants of residential premises. 6
827	827	(29) Bibles. [Unconstitutional; see Ahlburn v. Clark, 728 A.2d 449 (R.I. 1999); see Notes 7
828	828	to Decisions.] From the sale and from the storage, use, or other consumption in the state of any 8
829	829	canonized scriptures of any tax-exempt nonprofit religious organization including, but not limited 9
830	830	to, the Old Testament and the New Testament versions. 10
831	831	(30) Boats. 11
832	832	(i) From the sale of a boat or vessel to a bona fide nonresident of this state who does not 12
833	833	register the boat or vessel in this state or document the boat or vessel with the United States 13
834	834	government at a home port within the state, whether the sale or delivery of the boat or vessel is 14
835	835	made in this state or elsewhere; provided, that the nonresident transports the boat within thirty (30) 15
836	836	days after delivery by the seller outside the state for use thereafter solely outside the state. 16
837	837	(ii) The tax administrator, in addition to the provisions of §§ 44-19-27 and 44-19-28, may 17
838	838	require the seller of the boat or vessel to keep records of the sales to bona fide nonresidents as the 18
839	839	tax administrator deems reasonably necessary to substantiate the exemption provided in this 19
840	840	subdivision, including the affidavit of the seller that the buyer represented himself or herself to be 20
841	841	a bona fide nonresident of this state and of the buyer that he or she is a nonresident of this state. 21
842	842	(31) Youth activities equipment. From the sale, storage, use, or other consumption in this 22
843	843	state of items for not more than twenty dollars ($20.00) each by nonprofit Rhode Island 23
844	844	eleemosynary organizations, for the purposes of youth activities that the organization is formed to 24
845	845	sponsor and support; and by accredited elementary and secondary schools for the purposes of the 25
846	846	schools or of organized activities of the enrolled students. 26
847	847	(32) Farm equipment. From the sale and from the storage or use of machinery and 27
848	848	equipment used directly for commercial farming and agricultural production; including, but not 28
849	849	limited to: tractors, ploughs, harrows, spreaders, seeders, milking machines, silage conveyors, 29
850	850	balers, bulk milk storage tanks, trucks with farm plates, mowers, combines, irrigation equipment, 30
851	851	greenhouses and greenhouse coverings, graders and packaging machines, tools and supplies and 31
852	852	other farming equipment, including replacement parts appurtenant to or used in connection with 32
853	853	commercial farming and tools and supplies used in the repair and maintenance of farming 33
854	854	equipment. “Commercial farming” means the keeping or boarding of five (5) or more horses or the 34
855	855
856	856
857	857	LC001655 - Page 24 of 39
858	858	production within this state of agricultural products, including, but not limited to, field or orchard 1
859	859	crops, livestock, dairy, and poultry, or their products, where the keeping, boarding, or production 2
860	860	provides at least two thousand five hundred dollars ($2,500) in annual gross sales to the operator, 3
861	861	whether an individual, a group, a partnership, or a corporation for exemptions issued prior to July 4
862	862	1, 2002. For exemptions issued or renewed after July 1, 2002, there shall be two (2) levels. Level I 5
863	863	shall be based on proof of annual, gross sales from commercial farming of at least twenty-five 6
864	864	hundred dollars ($2,500) and shall be valid for purchases subject to the exemption provided in this 7
865	865	subdivision except for motor vehicles with an excise tax value of five thousand dollars ($5,000) or 8
866	866	greater. Level II shall be based on proof of annual gross sales from commercial farming of at least 9
867	867	ten thousand dollars ($10,000) or greater and shall be valid for purchases subject to the exemption 10
868	868	provided in this subdivision including motor vehicles with an excise tax value of five thousand 11
869	869	dollars ($5,000) or greater. For the initial issuance of the exemptions, proof of the requisite amount 12
870	870	of annual gross sales from commercial farming shall be required for the prior year; for any renewal 13
871	871	of an exemption granted in accordance with this subdivision at either level I or level II, proof of 14
872	872	gross annual sales from commercial farming at the requisite amount shall be required for each of 15
873	873	the prior two (2) years. Certificates of exemption issued or renewed after July 1, 2002, shall clearly 16
874	874	indicate the level of the exemption and be valid for four (4) years after the date of issue. This 17
875	875	exemption applies even if the same equipment is used for ancillary uses, or is temporarily used for 18
876	876	a non-farming or a non-agricultural purpose, but shall not apply to motor vehicles acquired after 19
877	877	July 1, 2002, unless the vehicle is a farm vehicle as defined pursuant to § 31-1-8 and is eligible for 20
878	878	registration displaying farm plates as provided for in § 31-3-31. 21
879	879	(33) Compressed air. From the sale and from the storage, use, or other consumption in the 22
880	880	state of compressed air. 23
881	881	(34) Flags. From the sale and from the storage, consumption, or other use in this state of 24
882	882	United States, Rhode Island or POW-MIA flags. 25
883	883	(35) Motor vehicle and adaptive equipment to certain veterans. From the sale of a motor 26
884	884	vehicle and adaptive equipment to and for the use of a veteran with a service-connected loss of or 27
885	885	the loss of use of a leg, foot, hand, or arm, or any veteran who is a double amputee, whether service 28
886	886	connected or not. The motor vehicle must be purchased by and especially equipped for use by the 29
887	887	qualifying veteran. Certificate of exemption or refunds of taxes paid is granted under rules or 30
888	888	regulations that the tax administrator may prescribe. 31
889	889	(36) Textbooks. From the sale and from the storage, use, or other consumption in this state 32
890	890	of textbooks by an “educational institution,” as defined in subsection (18) of this section, and any 33
891	891	educational institution within the purview of § 16-63-9(4), and used textbooks by any purveyor. 34
892	892
893	893
894	894	LC001655 - Page 25 of 39
895	895	(37) Tangible personal property and supplies used in on-site hazardous waste recycling, 1
896	896	reuse, or treatment. From the sale, storage, use, or other consumption in this state of tangible 2
897	897	personal property or supplies used or consumed in the operation of equipment, the exclusive 3
898	898	function of which is the recycling, reuse, or recovery of materials (other than precious metals, as 4
899	899	defined in subdivision (24)(ii) of this section) from the treatment of “hazardous wastes,” as defined 5
900	900	in § 23-19.1-4, where the “hazardous wastes” are generated in Rhode Island solely by the same 6
901	901	taxpayer and where the personal property is located at, in, or adjacent to a generating facility of the 7
902	902	taxpayer in Rhode Island. The taxpayer shall procure an order from the director of the department 8
903	903	of environmental management certifying that the equipment and/or supplies as used or consumed, 9
904	904	qualify for the exemption under this subdivision. If any information relating to secret processes or 10
905	905	methods of manufacture, production, or treatment is disclosed to the department of environmental 11
906	906	management only to procure an order, and is a “trade secret” as defined in § 28-21-10(b), it is not 12
907	907	open to public inspection or publicly disclosed unless disclosure is required under chapter 21 of 13
908	908	title 28 or chapter 24.4 of title 23. 14
909	909	(38) Promotional and product literature of boat manufacturers. From the sale and from the 15
910	910	storage, use, or other consumption of promotional and product literature of boat manufacturers 16
911	911	shipped to points outside of Rhode Island that either: (i) Accompany the product that is sold; (ii) 17
912	912	Are shipped in bulk to out-of-state dealers for use in the sale of the product; or (iii) Are mailed to 18
913	913	customers at no charge. 19
914	914	(39) Food items paid for by food stamps. From the sale and from the storage, use, or other 20
915	915	consumption in this state of eligible food items payment for which is properly made to the retailer 21
916	916	in the form of U.S. government food stamps issued in accordance with the Food Stamp Act of 1977, 22
917	917	7 U.S.C. § 2011 et seq. 23
918	918	(40) Transportation charges. From the sale or hiring of motor carriers as defined in § 39-24
919	919	12-2(12) to haul goods, when the contract or hiring cost is charged by a motor freight tariff filed 25
920	920	with the Rhode Island public utilities commission on the number of miles driven or by the number 26
921	921	of hours spent on the job. 27
922	922	(41) Trade-in value of boats. From the sale and from the storage, use, or other consumption 28
923	923	in this state of so much of the purchase price paid for a new or used boat as is allocated for a trade-29
924	924	in allowance on the boat of the buyer given in trade to the seller or of the proceeds applicable only 30
925	925	to the boat as are received from an insurance claim as a result of a stolen or damaged boat, towards 31
926	926	the purchase of a new or used boat by the buyer. 32
927	927	(42) Equipment used for research and development. From the sale and from the storage, 33
928	928	use, or other consumption of equipment to the extent used for research and development purposes 34
929	929
930	930
931	931	LC001655 - Page 26 of 39
932	932	by a qualifying firm. For the purposes of this subsection, “qualifying firm” means a business for 1
933	933	which the use of research and development equipment is an integral part of its operation and 2
934	934	“equipment” means scientific equipment, computers, software, and related items. 3
935	935	(43) Coins. From the sale and from the other consumption in this state of coins having 4
936	936	numismatic or investment value. 5
937	937	(44) Farm structure construction materials. Lumber, hardware, and other materials used in 6
938	938	the new construction of farm structures, including production facilities such as, but not limited to: 7
939	939	farrowing sheds, free stall and stanchion barns, milking parlors, silos, poultry barns, laying houses, 8
940	940	fruit and vegetable storages, rooting cellars, propagation rooms, greenhouses, packing rooms, 9
941	941	machinery storage, seasonal farm worker housing, certified farm markets, bunker and trench silos, 10
942	942	feed storage sheds, and any other structures used in connection with commercial farming. 11
943	943	(45) Telecommunications carrier access service. Carrier access service or 12
944	944	telecommunications service when purchased by a telecommunications company from another 13
945	945	telecommunications company to facilitate the provision of telecommunications service. 14
946	946	(46) Boats or vessels brought into the state exclusively for winter storage, maintenance, 15
947	947	repair, or sale. Notwithstanding the provisions of §§ 44-18-10, 44-18-11 and 44-18-20, the tax 16
948	948	imposed by § 44-18-20 is not applicable for the period commencing on the first day of October in 17
949	949	any year up to and including the 30th day of April next succeeding with respect to the use of any 18
950	950	boat or vessel within this state exclusively for purposes of: (i) Delivery of the vessel to a facility in 19
951	951	this state for storage, including dry storage and storage in water by means of apparatus preventing 20
952	952	ice damage to the hull, maintenance, or repair; (ii) The actual process of storage, maintenance, or 21
953	953	repair of the boat or vessel; or (iii) Storage for the purpose of selling the boat or vessel. 22
954	954	(47) Jewelry display product. From the sale and from the storage, use, or other 23
955	955	consumption in this state of tangible personal property used to display any jewelry product; 24
956	956	provided that title to the jewelry display product is transferred by the jewelry manufacturer or seller 25
957	957	and that the jewelry display product is shipped out of state for use solely outside the state and is not 26
958	958	returned to the jewelry manufacturer or seller. 27
959	959	(48) Boats or vessels generally. Notwithstanding the provisions of this chapter, the tax 28
960	960	imposed by §§ 44-18-20 and 44-18-18 shall not apply with respect to the sale and to the storage, 29
961	961	use, or other consumption in this state of any new or used boat. The exemption provided for in this 30
962	962	subdivision does not apply after October 1, 1993, unless prior to October 1, 1993, the federal ten 31
963	963	percent (10%) surcharge on luxury boats is repealed. 32
964	964	(49) Banks and regulated investment companies interstate toll-free calls. Notwithstanding 33
965	965	the provisions of this chapter, the tax imposed by this chapter does not apply to the furnishing of 34
966	966
967	967
968	968	LC001655 - Page 27 of 39
969	969	interstate and international, toll-free terminating telecommunication service that is used directly 1
970	970	and exclusively by or for the benefit of an eligible company as defined in this subdivision; provided 2
971	971	that an eligible company employs on average during the calendar year no less than five hundred 3
972	972	(500) “full-time equivalent employees” as that term is defined in § 42-64.5-2. For purposes of this 4
973	973	section, an “eligible company” means a “regulated investment company” as that term is defined in 5
974	974	the Internal Revenue Code of 1986, 26 U.S.C. § 851, or a corporation to the extent the service is 6
975	975	provided, directly or indirectly, to or on behalf of a regulated investment company, an employee 7
976	976	benefit plan, a retirement plan or a pension plan, or a state-chartered bank. 8
977	977	(50) Mobile and manufactured homes generally. From the sale and from the storage, use, 9
978	978	or other consumption in this state of mobile and/or manufactured homes as defined and subject to 10
979	979	taxation pursuant to the provisions of chapter 44 of title 31. 11
980	980	(51) Manufacturing business reconstruction materials. 12
981	981	(i) From the sale and from the storage, use, or other consumption in this state of lumber, 13
982	982	hardware, and other building materials used in the reconstruction of a manufacturing business 14
983	983	facility that suffers a disaster, as defined in this subdivision, in this state. “Disaster” means any 15
984	984	occurrence, natural or otherwise, that results in the destruction of sixty percent (60%) or more of 16
985	985	an operating manufacturing business facility within this state. “Disaster” does not include any 17
986	986	damage resulting from the willful act of the owner of the manufacturing business facility. 18
987	987	(ii) Manufacturing business facility includes, but is not limited to, the structures housing 19
988	988	the production and administrative facilities. 20
989	989	(iii) In the event a manufacturer has more than one manufacturing site in this state, the sixty 21
990	990	percent (60%) provision applies to the damages suffered at that one site. 22
991	991	(iv) To the extent that the costs of the reconstruction materials are reimbursed by insurance, 23
992	992	this exemption does not apply. 24
993	993	(52) Tangible personal property and supplies used in the processing or preparation of floral 25
994	994	products and floral arrangements. From the sale, storage, use, or other consumption in this state of 26
995	995	tangible personal property or supplies purchased by florists, garden centers, or other like producers 27
996	996	or vendors of flowers, plants, floral products, and natural and artificial floral arrangements that are 28
997	997	ultimately sold with flowers, plants, floral products, and natural and artificial floral arrangements 29
998	998	or are otherwise used in the decoration, fabrication, creation, processing, or preparation of flowers, 30
999	999	plants, floral products, or natural and artificial floral arrangements, including descriptive labels, 31
1000	1000	stickers, and cards affixed to the flower, plant, floral product, or arrangement, artificial flowers, 32
1001	1001	spray materials, floral paint and tint, plant shine, flower food, insecticide, and fertilizers. 33
1002	1002	(53) Horse food products. From the sale and from the storage, use, or other consumption 34
1003	1003
1004	1004
1005	1005	LC001655 - Page 28 of 39
1006	1006	in this state of horse food products purchased by a person engaged in the business of the boarding 1
1007	1007	of horses. 2
1008	1008	(54) Non-motorized recreational vehicles sold to nonresidents. 3
1009	1009	(i) From the sale, subsequent to June 30, 2003, of a non-motorized recreational vehicle to 4
1010	1010	a bona fide nonresident of this state who does not register the non-motorized recreational vehicle 5
1011	1011	in this state, whether the sale or delivery of the non-motorized recreational vehicle is made in this 6
1012	1012	state or at the place of residence of the nonresident; provided that a non-motorized recreational 7
1013	1013	vehicle sold to a bona fide nonresident whose state of residence does not allow a like exemption to 8
1014	1014	its nonresidents is not exempt from the tax imposed under § 44-18-20; provided, further, that in 9
1015	1015	that event the bona fide nonresident pays a tax to Rhode Island on the sale at a rate equal to the rate 10
1016	1016	that would be imposed in his or her state of residence not to exceed the rate that would have been 11
1017	1017	imposed under § 44-18-20. Notwithstanding any other provisions of law, a licensed, non-motorized 12
1018	1018	recreational vehicle dealer shall add and collect the tax required under this subdivision and remit 13
1019	1019	the tax to the tax administrator under the provisions of chapters 18 and 19 of this title. Provided, 14
1020	1020	that when a Rhode Island licensed, non-motorized recreational vehicle dealer is required to add and 15
1021	1021	collect the sales and use tax on the sale of a non-motorized recreational vehicle to a bona fide 16
1022	1022	nonresident as provided in this section, the dealer in computing the tax takes into consideration the 17
1023	1023	law of the state of the nonresident as it relates to the trade-in of motor vehicles. 18
1024	1024	(ii) The tax administrator, in addition to the provisions of §§ 44-19-27 and 44-19-28, may 19
1025	1025	require any licensed, non-motorized recreational vehicle dealer to keep records of sales to bona fide 20
1026	1026	nonresidents as the tax administrator deems reasonably necessary to substantiate the exemption 21
1027	1027	provided in this subdivision, including the affidavit of a licensed, non-motorized recreational 22
1028	1028	vehicle dealer that the purchaser of the non-motorized recreational vehicle was the holder of, and 23
1029	1029	had in his or her possession a valid out-of-state non-motorized recreational vehicle registration or 24
1030	1030	a valid out-of-state driver’s license. 25
1031	1031	(iii) Any nonresident who registers a non-motorized recreational vehicle in this state within 26
1032	1032	ninety (90) days of the date of its sale to him or her is deemed to have purchased the non-motorized 27
1033	1033	recreational vehicle for use, storage, or other consumption in this state, and is subject to, and liable 28
1034	1034	for, the use tax imposed under the provisions of § 44-18-20. 29
1035	1035	(iv) “Non-motorized recreational vehicle” means any portable dwelling designed and 30
1036	1036	constructed to be used as a temporary dwelling for travel, camping, recreational, and vacation use 31
1037	1037	that is eligible to be registered for highway use, including, but not limited to, “pick-up coaches” or 32
1038	1038	“pick-up campers,” “travel trailers,” and “tent trailers” as those terms are defined in chapter 1 of 33
1039	1039	title 31. 34
1040	1040
1041	1041
1042	1042	LC001655 - Page 29 of 39
1043	1043	(55) Sprinkler and fire alarm systems in existing buildings. From the sale in this state of 1
1044	1044	sprinkler and fire alarm systems; emergency lighting and alarm systems; and the materials 2
1045	1045	necessary and attendant to the installation of those systems that are required in buildings and 3
1046	1046	occupancies existing therein in July 2003 in order to comply with any additional requirements for 4
1047	1047	such buildings arising directly from the enactment of the Comprehensive Fire Safety Act of 2003 5
1048	1048	and that are not required by any other provision of law or ordinance or regulation adopted pursuant 6
1049	1049	to that act. The exemption provided in this subdivision shall expire on December 31, 2008. 7
1050	1050	(56) Aircraft. Notwithstanding the provisions of this chapter, the tax imposed by §§ 44-8
1051	1051	18-18 and 44-18-20 shall not apply with respect to the sale and to the storage, use, or other 9
1052	1052	consumption in this state of any new or used aircraft or aircraft parts. 10
1053	1053	(57) Renewable energy products. Notwithstanding any other provisions of Rhode Island 11
1054	1054	general laws, the following products shall also be exempt from sales tax: solar photovoltaic 12
1055	1055	modules or panels, or any module or panel that generates electricity from light; solar thermal 13
1056	1056	collectors, including, but not limited to, those manufactured with flat glass plates, extruded plastic, 14
1057	1057	sheet metal, and/or evacuated tubes; geothermal heat pumps, including both water-to-water and 15
1058	1058	water-to-air type pumps; wind turbines; towers used to mount wind turbines if specified by or sold 16
1059	1059	by a wind turbine manufacturer; DC to AC inverters that interconnect with utility power lines; and 17
1060	1060	manufactured mounting racks and ballast pans for solar collector, module, or panel installation. Not 18
1061	1061	to include materials that could be fabricated into such racks; monitoring and control equipment, if 19
1062	1062	specified or supplied by a manufacturer of solar thermal, solar photovoltaic, geothermal, or wind 20
1063	1063	energy systems or if required by law or regulation for such systems but not to include pumps, fans 21
1064	1064	or plumbing or electrical fixtures unless shipped from the manufacturer affixed to, or an integral 22
1065	1065	part of, another item specified on this list; and solar storage tanks that are part of a solar domestic 23
1066	1066	hot water system or a solar space heating system. If the tank comes with an external heat exchanger 24
1067	1067	it shall also be tax exempt, but a standard hot water tank is not exempt from state sales tax. 25
1068	1068	(58) Returned property. The amount charged for property returned by customers upon 26
1069	1069	rescission of the contract of sale when the entire amount exclusive of handling charges paid for the 27
1070	1070	property is refunded in either cash or credit, and where the property is returned within one hundred 28
1071	1071	twenty (120) days from the date of delivery. 29
1072	1072	(59) Dietary supplements. From the sale and from the storage, use, or other consumption 30
1073	1073	of dietary supplements as defined in § 44-18-7.1(l)(v), sold on prescriptions. 31
1074	1074	(60) Blood. From the sale and from the storage, use, or other consumption of human blood. 32
1075	1075	(61) Agricultural products for human consumption. From the sale and from the storage, 33
1076	1076	use, or other consumption of livestock and poultry of the kinds of products that ordinarily constitute 34
1077	1077
1078	1078
1079	1079	LC001655 - Page 30 of 39
1080	1080	food for human consumption and of livestock of the kind the products of which ordinarily constitute 1
1081	1081	fibers for human use. 2
1082	1082	(62) Diesel emission control technology. From the sale and use of diesel retrofit 3
1083	1083	technology that is required by § 31-47.3-4. 4
1084	1084	(63) Feed for certain animals used in commercial farming. From the sale of feed for 5
1085	1085	animals as described in subsection (61) of this section. 6
1086	1086	(64) Alcoholic beverages. From the sale and storage, use, or other consumption in this 7
1087	1087	state by a Class A licensee of alcoholic beverages, as defined in § 44-18-7.1, excluding beer and 8
1088	1088	malt beverages; provided, further, notwithstanding § 6-13-1 or any other general or public law to 9
1089	1089	the contrary, alcoholic beverages, as defined in § 44-18-7.1, shall not be subject to minimum 10
1090	1090	markup. 11
1091	1091	(65) Seeds and plants used to grow food and food ingredients. From the sale, storage, use, 12
1092	1092	or other consumption in this state of seeds and plants used to grow food and food ingredients as 13
1093	1093	defined in § 44-18-7.1(l)(i). “Seeds and plants used to grow food and food ingredients” shall not 14
1094	1094	include marijuana seeds or plants. 15
1095	1095	(66) Feminine hygiene products. From the sale and from the storage, use, or other 16
1096	1096	consumption of tampons, panty liners, menstrual cups, sanitary napkins, and other similar products 17
1097	1097	the principal use of which is feminine hygiene in connection with the menstrual cycle. 18
1098	1098	(67) “Breast pump collection and storage supplies” means items of tangible personal 19
1099	1099	property used in conjunction with a breast pump to collect milk expressed from a human breast and 20
1100	1100	to store collected milk until it is ready for consumption. “Breast pump collection and storage 21
1101	1101	supplies” include, but are not limited to, breast shields and breast shield connectors; breast pump 22
1102	1102	tubes and tubing adaptors; breast pump valves and membranes; backflow protectors and backflow 23
1103	1103	protector adaptors; bottles and bottle caps specific to the operation of the breast pump; breast milk 24
1104	1104	storage bags; and related items sold as part of a breast pump kit pre-packaged by the breast pump 25
1105	1105	manufacturer. “Breast pump collection and storage supplies” does not include: bottles and bottle 26
1106	1106	caps not specific to the operation of the breast pump; breast pump travel bags and other similar 27
1107	1107	carrying accessories, including ice packs, labels, and other similar products, unless sold as part of 28
1108	1108	a breast pump kit pre-packed by the breast pump manufacturer; breast pump cleaning supplies, 29
1109	1109	unless sold as part of a breast pump kit pre-packaged by the breast pump manufacturer; nursing 30
1110	1110	bras, bra pads, breast shells, and other similar products; and creams, ointments, and other similar 31
1111	1111	products that relieve breastfeeding-related symptoms or conditions of the breasts or nipples. 32
1112	1112	(68) Trade-in value of motorcycles. From the sale and from the storage, use, or other 33
1113	1113	consumption in this state of so much of the purchase price paid for a new or used motorcycle as is 34
1114	1114
1115	1115
1116	1116	LC001655 - Page 31 of 39
1117	1117	allocated for a trade-in allowance on the motorcycle of the buyer given in trade to the seller, or of 1
1118	1118	the proceeds applicable only to the motorcycle as are received from the manufacturer of 2
1119	1119	motorcycles for the repurchase of the motorcycle whether the repurchase was voluntary or not 3
1120	1120	towards the purchase of a new or used motorcycle by the buyer. For the purpose of this subsection, 4
1121	1121	the word “motorcycle” means a motorcycle not used for hire and does not refer to any other type 5
1122	1122	of motor vehicle. 6
1123	1123	(69) From the sale, storage, use, or other consumption in this state of farm products used 7
1124	1124	to grow food by urban and small farmers. 8
1125	1125	(i) For purposes of this subsection: 9
1126	1126	(A) An “urban farmer” is a taxpayer that produces or grows food in a city or other heavily 10
1127	1127	populated areas; and 11
1128	1128	(B) A “small farmer” is a taxpayer that farms agricultural land up to five (5) acres. 12
1129	1129	SECTION 4. Section 44-30-12 of the General Laws in Chapter 44-30 entitled "Personal 13
1130	1130	Income Tax" is hereby amended to read as follows: 14
1131	1131	44-30-12. Rhode Island income of a resident individual. 15
1132	1132	(a) General. The Rhode Island income of a resident individual means his or her adjusted 16
1133	1133	gross income for federal income tax purposes, with the modifications specified in this section. 17
1134	1134	(b) Modifications increasing federal adjusted gross income. There shall be added to 18
1135	1135	federal adjusted gross income: 19
1136	1136	(1) Interest income on obligations of any state, or its political subdivisions, other than 20
1137	1137	Rhode Island or its political subdivisions; 21
1138	1138	(2) Interest or dividend income on obligations or securities of any authority, commission, 22
1139	1139	or instrumentality of the United States, but not of Rhode Island or its political subdivisions, to the 23
1140	1140	extent exempted by the laws of the United States from federal income tax but not from state income 24
1141	1141	taxes; 25
1142	1142	(3) The modification described in § 44-30-25(g); 26
1143	1143	(4)(i) The amount defined below of a nonqualified withdrawal made from an account in 27
1144	1144	the tuition savings program pursuant to § 16-57-6.1. For purposes of this section, a nonqualified 28
1145	1145	withdrawal is: 29
1146	1146	(A) A transfer or rollover to a qualified tuition program under Section 529 of the Internal 30
1147	1147	Revenue Code, 26 U.S.C. § 529, other than to the tuition savings program referred to in § 16-57-31
1148	1148	6.1; and 32
1149	1149	(B) A withdrawal or distribution that is: 33
1150	1150	(I) Not applied on a timely basis to pay “qualified higher education expenses” as defined 34
1151	1151
1152	1152
1153	1153	LC001655 - Page 32 of 39
1154	1154	in § 16-57-3(12) of the beneficiary of the account from which the withdrawal is made; 1
1155	1155	(II) Not made for a reason referred to in § 16-57-6.1(e); or 2
1156	1156	(III) Not made in other circumstances for which an exclusion from tax made applicable by 3
1157	1157	Section 529 of the Internal Revenue Code, 26 U.S.C. § 529, pertains if the transfer, rollover, 4
1158	1158	withdrawal, or distribution is made within two (2) taxable years following the taxable year for 5
1159	1159	which a contributions modification pursuant to subsection (c)(4) of this section is taken based on 6
1160	1160	contributions to any tuition savings program account by the person who is the participant of the 7
1161	1161	account at the time of the contribution, whether or not the person is the participant of the account 8
1162	1162	at the time of the transfer, rollover, withdrawal or distribution; 9
1163	1163	(ii) In the event of a nonqualified withdrawal under subsection (b)(4)(i)(A) or (b)(4)(i)(B) 10
1164	1164	of this section, there shall be added to the federal adjusted gross income of that person for the 11
1165	1165	taxable year of the withdrawal an amount equal to the lesser of: 12
1166	1166	(A) The amount equal to the nonqualified withdrawal reduced by the sum of any 13
1167	1167	administrative fee or penalty imposed under the tuition savings program in connection with the 14
1168	1168	nonqualified withdrawal plus the earnings portion thereof, if any, includible in computing the 15
1169	1169	person’s federal adjusted gross income for the taxable year; and 16
1170	1170	(B) The amount of the person’s contribution modification pursuant to subsection (c)(4) of 17
1171	1171	this section for the person’s taxable year of the withdrawal and the two (2) prior taxable years less 18
1172	1172	the amount of any nonqualified withdrawal for the two (2) prior taxable years included in 19
1173	1173	computing the person’s Rhode Island income by application of this subsection for those years. Any 20
1174	1174	amount added to federal adjusted gross income pursuant to this subdivision shall constitute Rhode 21
1175	1175	Island income for residents, nonresidents and part-year residents; 22
1176	1176	(5) The modification described in § 44-30-25.1(d)(3)(i); 23
1177	1177	(6) The amount equal to any unemployment compensation received but not included in 24
1178	1178	federal adjusted gross income; 25
1179	1179	(7) The amount equal to the deduction allowed for sales tax paid for a purchase of a 26
1180	1180	qualified motor vehicle as defined by the Internal Revenue Code § 164(a)(6); and 27
1181	1181	(8) For any taxable year beginning on or after January 1, 2020, the amount of any Paycheck 28
1182	1182	Protection Program loan forgiven for federal income tax purposes as authorized by the Coronavirus 29
1183	1183	Aid, Relief, and Economic Security Act and/or the Consolidated Appropriations Act, 2021 and/or 30
1184	1184	any other subsequent federal stimulus relief packages enacted by law, to the extent that the amount 31
1185	1185	of the loan forgiven exceeds $250,000, including an individual’s distributive share of the amount 32
1186	1186	of a pass-through entity’s loan forgiveness in excess of $250,000. 33
1187	1187	(c) Modifications reducing federal adjusted gross income. There shall be subtracted 34
1188	1188
1189	1189
1190	1190	LC001655 - Page 33 of 39
1191	1191	from federal adjusted gross income: 1
1192	1192	(1) Any interest income on obligations of the United States and its possessions to the extent 2
1193	1193	includible in gross income for federal income tax purposes, and any interest or dividend income on 3
1194	1194	obligations, or securities of any authority, commission, or instrumentality of the United States to 4
1195	1195	the extent includible in gross income for federal income tax purposes but exempt from state income 5
1196	1196	taxes under the laws of the United States; provided, that the amount to be subtracted shall in any 6
1197	1197	case be reduced by any interest on indebtedness incurred or continued to purchase or carry 7
1198	1198	obligations or securities the income of which is exempt from Rhode Island personal income tax, to 8
1199	1199	the extent the interest has been deducted in determining federal adjusted gross income or taxable 9
1200	1200	income; 10
1201	1201	(2) A modification described in § 44-30-25(f) or § 44-30-1.1(c)(1); 11
1202	1202	(3) The amount of any withdrawal or distribution from the “tuition savings program” 12
1203	1203	referred to in § 16-57-6.1 that is included in federal adjusted gross income, other than a withdrawal 13
1204	1204	or distribution or portion of a withdrawal or distribution that is a nonqualified withdrawal; 14
1205	1205	(4) Contributions made to an account under the tuition savings program, including the 15
1206	1206	“contributions carryover” pursuant to subsection (c)(4)(iv) of this section, if any, subject to the 16
1207	1207	following limitations, restrictions and qualifications: 17
1208	1208	(i) The aggregate subtraction pursuant to this subdivision for any taxable year of the 18
1209	1209	taxpayer shall not exceed five hundred dollars ($500) or one thousand dollars ($1,000) if a joint 19
1210	1210	return; 20
1211	1211	(ii) The following shall not be considered contributions: 21
1212	1212	(A) Contributions made by any person to an account who is not a participant of the account 22
1213	1213	at the time the contribution is made; 23
1214	1214	(B) Transfers or rollovers to an account from any other tuition savings program account or 24
1215	1215	from any other “qualified tuition program” under section 529 of the Internal Revenue Code, 26 25
1216	1216	U.S.C. § 529; or 26
1217	1217	(C) A change of the beneficiary of the account; 27
1218	1218	(iii) The subtraction pursuant to this subdivision shall not reduce the taxpayer’s federal 28
1219	1219	adjusted gross income to less than zero (0); 29
1220	1220	(iv) The contributions carryover to a taxable year for purpose of this subdivision is the 30
1221	1221	excess, if any, of the total amount of contributions actually made by the taxpayer to the tuition 31
1222	1222	savings program for all preceding taxable years for which this subsection is effective over the sum 32
1223	1223	of: 33
1224	1224	(A) The total of the subtractions under this subdivision allowable to the taxpayer for all 34
1225	1225
1226	1226
1227	1227	LC001655 - Page 34 of 39
1228	1228	such preceding taxable years; and 1
1229	1229	(B) That part of any remaining contribution carryover at the end of the taxable year which 2
1230	1230	exceeds the amount of any nonqualified withdrawals during the year and the prior two (2) taxable 3
1231	1231	years not included in the addition provided for in this subdivision for those years. Any such part 4
1232	1232	shall be disregarded in computing the contributions carryover for any subsequent taxable year; 5
1233	1233	(v) For any taxable year for which a contributions carryover is applicable, the taxpayer 6
1234	1234	shall include a computation of the carryover with the taxpayer’s Rhode Island personal income tax 7
1235	1235	return for that year, and if for any taxable year on which the carryover is based the taxpayer filed a 8
1236	1236	joint Rhode Island personal income tax return but filed a return on a basis other than jointly for a 9
1237	1237	subsequent taxable year, the computation shall reflect how the carryover is being allocated between 10
1238	1238	the prior joint filers; 11
1239	1239	(5) The modification described in § 44-30-25.1(d)(1); 12
1240	1240	(6) Amounts deemed taxable income to the taxpayer due to payment or provision of 13
1241	1241	insurance benefits to a dependent, including a domestic partner pursuant to chapter 12 of title 36 or 14
1242	1242	other coverage plan; 15
1243	1243	(7) Modification for organ transplantation. 16
1244	1244	(i) An individual may subtract up to ten thousand dollars ($10,000) from federal adjusted 17
1245	1245	gross income if he or she, while living, donates one or more of his or her human organs to another 18
1246	1246	human being for human organ transplantation, except that for purposes of this subsection, “human 19
1247	1247	organ” means all or part of a liver, pancreas, kidney, intestine, lung, or bone marrow. A subtract 20
1248	1248	modification that is claimed hereunder may be claimed in the taxable year in which the human 21
1249	1249	organ transplantation occurs. 22
1250	1250	(ii) An individual may claim that subtract modification hereunder only once, and the 23
1251	1251	subtract modification may be claimed for only the following unreimbursed expenses that are 24
1252	1252	incurred by the claimant and related to the claimant’s organ donation: 25
1253	1253	(A) Travel expenses. 26
1254	1254	(B) Lodging expenses. 27
1255	1255	(C) Lost wages. 28
1256	1256	(iii) The subtract modification hereunder may not be claimed by a part-time resident or a 29
1257	1257	nonresident of this state; 30
1258	1258	(8) Modification for taxable Social Security income. 31
1259	1259	(i) For tax years beginning on or after January 1, 2016: 32
1260	1260	(A) For a person who has attained the age used for calculating full or unreduced Social 33
1261	1261	Security retirement benefits who files a return as an unmarried individual, head of household, or 34
1262	1262
1263	1263
1264	1264	LC001655 - Page 35 of 39
1265	1265	married filing separate whose federal adjusted gross income for the taxable year is less than eighty 1
1266	1266	thousand dollars ($80,000); or 2
1267	1267	(B) A married individual filing jointly or individual filing qualifying widow(er) who has 3
1268	1268	attained the age used for calculating full or unreduced Social Security retirement benefits whose 4
1269	1269	joint federal adjusted gross income for the taxable year is less than one hundred thousand dollars 5
1270	1270	($100,000), an amount equal to the Social Security benefits includible in federal adjusted gross 6
1271	1271	income. 7
1272	1272	(ii) Adjustment for inflation. The dollar amount contained in subsections (c)(8)(i)(A) and 8
1273	1273	(c)(8)(i)(B) of this section shall be increased annually by an amount equal to: 9
1274	1274	(A) Such dollar amount contained in subsections (c)(8)(i)(A) and (c)(8)(i)(B) of this section 10
1275	1275	adjusted for inflation using a base tax year of 2000, multiplied by; 11
1276	1276	(B) The cost-of-living adjustment with a base year of 2000. 12
1277	1277	(iii) For the purposes of this section the cost-of-living adjustment for any calendar year is 13
1278	1278	the percentage (if any) by which the consumer price index for the preceding calendar year exceeds 14
1279	1279	the consumer price index for the base year. The consumer price index for any calendar year is the 15
1280	1280	average of the consumer price index as of the close of the twelve-month (12) period ending on 16
1281	1281	August 31, of such calendar year. 17
1282	1282	(iv) For the purpose of this section the term “consumer price index” means the last 18
1283	1283	consumer price index for all urban consumers published by the department of labor. For the purpose 19
1284	1284	of this section the revision of the consumer price index which is most consistent with the consumer 20
1285	1285	price index for calendar year 1986 shall be used. 21
1286	1286	(v) If any increase determined under this section is not a multiple of fifty dollars ($50.00), 22
1287	1287	such increase shall be rounded to the next lower multiple of fifty dollars ($50.00). In the case of a 23
1288	1288	married individual filing separate return, if any increase determined under this section is not a 24
1289	1289	multiple of twenty-five dollars ($25.00), such increase shall be rounded to the next lower multiple 25
1290	1290	of twenty-five dollars ($25.00); 26
1291	1291	(9) Modification of taxable retirement income from certain pension plans or 27
1292	1292	annuities. 28
1293	1293	(i) For tax years beginning on or after January 1, 2017, until the tax year beginning January 29
1294	1294	1, 2022, a modification shall be allowed for up to fifteen thousand dollars ($15,000), and for tax 30
1295	1295	years beginning on or after January 1, 2023, a modification shall be allowed for up to twenty 31
1296	1296	thousand dollars ($20,000), of taxable pension and/or annuity income that is included in federal 32
1297	1297	adjusted gross income for the taxable year: 33
1298	1298	(A) For a person who has attained the age used for calculating full or unreduced Social 34
1299	1299
1300	1300
1301	1301	LC001655 - Page 36 of 39
1302	1302	Security retirement benefits who files a return as an unmarried individual, head of household, or 1
1303	1303	married filing separate whose federal adjusted gross income for such taxable year is less than the 2
1304	1304	amount used for the modification contained in subsection (c)(8)(i)(A) of this section an amount not 3
1305	1305	to exceed $15,000 for tax years beginning on or after January 1, 2017, until the tax year beginning 4
1306	1306	January 1, 2022, and an amount not to exceed twenty thousand dollars ($20,000) for tax years 5
1307	1307	beginning on or after January 1, 2023, of taxable pension and/or annuity income includible in 6
1308	1308	federal adjusted gross income; or 7
1309	1309	(B) For a married individual filing jointly or individual filing qualifying widow(er) who 8
1310	1310	has attained the age used for calculating full or unreduced Social Security retirement benefits whose 9
1311	1311	joint federal adjusted gross income for such taxable year is less than the amount used for the 10
1312	1312	modification contained in subsection (c)(8)(i)(B) of this section an amount not to exceed $15,000 11
1313	1313	for tax years beginning on or after January 1, 2017, until the tax year beginning January 1, 2022, 12
1314	1314	and an amount not to exceed twenty thousand dollars ($20,000) for tax years beginning on or after 13
1315	1315	January 1, 2023, of taxable pension and/or annuity income includible in federal adjusted gross 14
1316	1316	income. 15
1317	1317	(ii) Adjustment for inflation. The dollar amount contained by reference in subsections 16
1318	1318	(c)(9)(i)(A) and (c)(9)(i)(B) of this section shall be increased annually for tax years beginning on 17
1319	1319	or after January 1, 2018, by an amount equal to: 18
1320	1320	(A) Such dollar amount contained by reference in subsections (c)(9)(i)(A) and (c)(9)(i)(B) 19
1321	1321	of this section adjusted for inflation using a base tax year of 2000, multiplied by; 20
1322	1322	(B) The cost-of-living adjustment with a base year of 2000. 21
1323	1323	(iii) For the purposes of this section, the cost-of-living adjustment for any calendar year is 22
1324	1324	the percentage (if any) by which the consumer price index for the preceding calendar year exceeds 23
1325	1325	the consumer price index for the base year. The consumer price index for any calendar year is the 24
1326	1326	average of the consumer price index as of the close of the twelve-month (12) period ending on 25
1327	1327	August 31, of such calendar year. 26
1328	1328	(iv) For the purpose of this section, the term “consumer price index” means the last 27
1329	1329	consumer price index for all urban consumers published by the department of labor. For the purpose 28
1330	1330	of this section, the revision of the consumer price index which is most consistent with the consumer 29
1331	1331	price index for calendar year 1986 shall be used. 30
1332	1332	(v) If any increase determined under this section is not a multiple of fifty dollars ($50.00), 31
1333	1333	such increase shall be rounded to the next lower multiple of fifty dollars ($50.00). In the case of a 32
1334	1334	married individual filing a separate return, if any increase determined under this section is not a 33
1335	1335	multiple of twenty-five dollars ($25.00), such increase shall be rounded to the next lower multiple 34
1336	1336
1337	1337
1338	1338	LC001655 - Page 37 of 39
1339	1339	of twenty-five dollars ($25.00). 1
1340	1340	(vi) For tax years beginning on or after January 1, 2022, the dollar amount contained by 2
1341	1341	reference in subsection (c)(9)(i)(A) shall be adjusted to equal the dollar amount contained in 3
1342	1342	subsection (c)(8)(i)(A), as adjusted for inflation, and the dollar amount contained by reference in 4
1343	1343	subsection(c)(9)(i)(B) shall be adjusted to equal the dollar amount contained in subsection 5
1344	1344	(c)(8)(i)(B), as adjusted for inflation; 6
1345	1345	(10) Modification for Rhode Island investment in opportunity zones. For purposes of 7
1346	1346	a taxpayer’s state tax liability, in the case of any investment in a Rhode Island opportunity zone by 8
1347	1347	the taxpayer for at least seven (7) years, a modification to income shall be allowed for the 9
1348	1348	incremental difference between the benefit allowed under 26 U.S.C. § 1400Z-2(b)(2)(B)(iv) and 10
1349	1349	the federal benefit allowed under 26 U.S.C. § 1400Z-2(c); 11
1350	1350	(11) Modification for military service pensions. 12
1351	1351	(i) For purposes of a taxpayer’s state tax liability, a modification to income shall be allowed 13
1352	1352	as follows: 14
1353	1353	(A) For the tax years beginning on January 1, 2023, a taxpayer may subtract from federal 15
1354	1354	adjusted gross income the taxpayer’s military service pension benefits included in federal adjusted 16
1355	1355	gross income; 17
1356	1356	(ii) As used in this subsection, the term “military service” shall have the same meaning as 18
1357	1357	set forth in 20 C.F.R. § 212.2; 19
1358	1358	(iii) At no time shall the modification allowed under this subsection alone or in conjunction 20
1359	1359	with subsection (c)(9) exceed the amount of the military service pension received in the tax year 21
1360	1360	for which the modification is claimed; and 22
1361	1361	(12) Any rebate issued to the taxpayer pursuant to § 44-30-103 to the extent included in 23
1362	1362	gross income for federal tax purposes.; and 24
1363	1363	(13) Modification for urban and small farmers income. For tax years beginning on or after 25
1364	1364	January 1, 2024, a modification shall be allowed for the taxable income that is included in federal 26
1365	1365	adjusted gross income for urban and small farmers. 27
1366	1366	(i) For purposes of this subsection: 28
1367	1367	(A) An “urban farmer” is a taxpayer that produces or grows food in a city or other heavily 29
1368	1368	populated areas; and 30
1369	1369	(B) A “small farmer” is a taxpayer that farms agricultural land up to five (5) acres. 31
1370	1370	(d) Modification for Rhode Island fiduciary adjustment. There shall be added to, or 32
1371	1371	subtracted from, federal adjusted gross income (as the case may be) the taxpayer’s share, as 33
1372	1372	beneficiary of an estate or trust, of the Rhode Island fiduciary adjustment determined under § 44-34
1373	1373
1374	1374
1375	1375	LC001655 - Page 38 of 39
1376	1376	30-17. 1
1377	1377	(e) Partners. The amounts of modifications required to be made under this section by a 2
1378	1378	partner, which relate to items of income or deduction of a partnership, shall be determined under § 3
1379	1379	44-30-15. 4
1380	1380	SECTION 5. This act shall take effect upon passage. 5
1381	1381	========
1382	1382	LC001655
1383	1383	========
1384	1384
1385	1385
1386	1386	LC001655 - Page 39 of 39
1387	1387	EXPLANATION
1388	1388	BY THE LEGISLATIVE COUNCIL
1389	1389	OF
1390	1390	A N A C T
1391	1391	RELATING TO TAXATION -- PROPERTY SUBJECT TO TAXATION
1392	1392	***
1393	1393	This act would exempt urban and small farmers from sales taxes, real, tangible and personal 1
1394	1394	property taxes and income taxes. This act would also define urban and small farmers. 2
1395	1395	This act would take effect upon passage. 3
1396	1396	========
1397	1397	LC001655
1398	1398	========
1399	1399