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Rhode Island’s millionaire’s tax a ‘riverboat gamble’ | Opinion

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Rhode Island’s millionaire’s tax a ‘riverboat gamble’ | Opinion


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  • Rhode Island reformed its tax code after 2009, improving its business tax climate ranking from 46th to 40th.
  • Democratic gubernatorial candidates are now proposing to raise the top income tax rate from 5.99% to 8.99% for incomes over $1 million.
  • Supporters of the tax increase believe it will have minimal impact on growth, while opponents fear it will harm state competitiveness.
  • The author suggests key questions must be answered about the economic impact before implementing such a significant tax policy change.

In the 2009 State of the State address Governor Don Carcieri said he was “tired of people writing stories about Rhode Island being ‘tax hell’.” In response the governor convened a Tax Policy Strategic Workgroup. As state director of revenue, I chaired the Workgroup. We were charged with developing a tax strategy so that Rhode Island’s tax structure would be a competitive advantage in retaining jobs and recruiting businesses.

Over the next few legislative sessions, the state’s tax code was reformed. The top marginal income tax rate was reduced from 9.90 percent to 5.99 percent. As a quid pro quo itemization was eliminated, the standard deduction and personal exemptions were phased out for high-income filers, the alternative minimum tax was eliminated, tax brackets and exemptions were indexed to inflation, and the numbers of tax credits were reduced from 45 to 9.

The method of apportioning the corporate income tax was modernized, and the tax rate was reduced from nine percent to seven percent – the lowest rate in New England. The threshold of the estate tax deduction was doubled and indexed to inflation.

As a result, Rhode Island escaped the designation of having one of the ten worst tax climates for business. In 2011, when the General Assembly began addressing tax reform, the conservative Tax Foundation’s Business Tax Climate Index ranked the Ocean State’s tax climate 46th (5th worst). By 2025 it improved to 39th. This year Rhode Island ranks 40th.

Currently both Democratic gubernatorial candidates are proposing a tax policy “sea-change.” They are promoting legislation to impose an 8.99 percent rate on taxable incomes over $1 million, a 50 percent increase over the current rate of 5.99 percent.

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Deciding the merits of this proposal should be based on the tenets of sound tax policy: equity, competitiveness, and transparency.  Equity is achieved when no group carries a disproportionate share of the tax burden.  Transparency is achieved when the system is user-friendly and efficiently administered.

The most difficult principle to measure is competitiveness. Economists have not always agreed on the effect tax burdens have on the economic decisions made by households and businesses.

Can a top marginal income tax rate be increased by 50 percent and not have a demonstrable impact on job growth and investments?

It will be challenging to resolve this question because the “peer reviewed research” supports different conclusions. Academic research through the 1960s generally found limited evidence that tax rate differentials influenced business growth and location decisions. In the 1980s, studies found the impact of tax burdens on private sector economic activity depended on specific circumstances. More recent empirical studies indicate tax changes do influence economic behavior. However, there are difference as to the degree of such influences.

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Rhode Island’s business leaders opposed to the 50 percent increase in the top marginal tax rate point to state competitiveness rankings, potential out-migration of people and capital, fiscal volatility, and the impact on small business. Progressive proponents cite data suggesting top-rate increases rarely affect state-level growth, and high-income migration responses are marginal.

Given economic and international uncertainties, could the timing of income tax rate increase be a riverboat gamble with Rhode Island’s future economic well-being?  An informed decision should provide data and analysis on the following threshold questions.

What is the forecasted impact of the millionaire’s tax on state GDP growth, employment, and revenue feedback effects?

Without doing harm, how high can the rate be set relative to competitor states? If the top marginal rate was increased by 15% compared to the 50%, how would the gamble be mitigated?

What will the new revenue be used for – education, infrastructure, housing, working families tax relief, or balancing the budget?

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What are the costs and benefits of maintaining the status quo?

Will Rhode Island’s availability of skilled labor, preparedness for an artificial intelligence economy, and other amenities minimize any potential economic impacts of a 50 percent increase in the top income tax rate? Some states may have competitive advantages that could reduce the economic risks, while others may not.

Gary Sasse served as director of the R.I. Departments of Revenue and Administration.



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Rhode Island

32 photos capturing Rhode Island Pride’s nighttime magic

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32 photos capturing Rhode Island Pride’s nighttime magic


Rhode Island Pride celebrated its 50th anniversary on June 20 as thousands gathered in downtown Providence for a day of performances, community, and celebration.

The event featured PrideFest with hundreds of community organizations, businesses, vendors, and performers, including headliners Adore Delano, Juicy Love Dion, and Paris Bennett, followed by Rhode Island Pride’s signature Illuminated Night Parade—one of the few Pride parades in the country to take place after dark.


Held under the theme “We Are the People,” this year’s event honored the activists who organized Rhode Island’s first Pride march in 1976 while recognizing the generations who continue to shape the state’s LGBTQ+ community today.

“Our founders understood something that remains true today: change happens when people show up,” said Rodney Davis, president of Rhode Island Pride. “Fifty years after that first march, more than 100,000 people stood together in downtown Providence to declare that we are still here, still visible, and still proud. ‘We Are The People’ is more than a theme—it is a recognition of every person who has contributed to this movement, from the pioneers who marched in 1976 to the young people who will shape the next 50 years.”

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“This year demonstrated the incredible power of community,” added Jess Motyl-Szary, director of Rhode Island Pride. “Every volunteer, performer, sponsor, vendor, parade participant, and attendee helped create a space where people could feel welcomed, celebrated, and connected. The energy throughout the day and night was extraordinary, and it showed why Pride remains so important.”

Take a look at some of the most memorable moments from Rhode Island Pride’s 50th anniversary, courtesy of photographs from Ryan Welch, Kris Laliberte, Jordan Roberts, Kristen Beres, Brian Felsenthal, Leo Selvaggio, Willow Hicks, and Maxwell Snyder.





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RI becomes first state to establish grocery self-checkout limits

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RI becomes first state to establish grocery self-checkout limits


PROVIDENCE, R.I. (WPRI) — Rhode Island is now the first state in the country to implement self-checkout lane restrictions at grocery stores.

Gov. Dan McKee joined local workers and leaders in Providence Thursday to publicly sign the Restrictions on “Self-Service Checkout Stations Act” into law. It initially passed in the Senate last month, but a revised version was sent back by the House on June 10. The Senate passed the amended bill the next day, advancing it to McKee’s desk.

 “Today, we’re protecting jobs and strengthening customer service,” McKee said. “Whether it’s helping a customer with an issue, assisting a senior, or ensuring accessibility for people with disabilities, this law is about preserving choice and keeping people at the center of the shopping experience.”

Under the new legislation, all grocery stores in the state will be required to have one manually staffed cashier lane for every three self-checkout stations. It also limits the tasks a worker can be assigned, stating that their employer must relieve them of all other duties — including running a manual lane — while monitoring self-checkout stations. Additionally, one manual cashier lane must always be open in compliance with the Americans with Disabilities Act.

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Grocery stores that violate the law can be fined based on the wages for one full shift at the highest hourly pay rate, up to $1,000 per day. If a store continues not to comply after being notified of a violation, it may face more penalties under the state consumer protection laws.

Employees and consumers are entitled to file complaints with the R.I. Department of Labor & Training without fear of retaliation if they notice a store is out of compliance, according to the legislation.

Senate President Valarie Lawson said she introduced the bill out of concern for cashier workers, as well as customers who might struggle with “frustrating” self-checkout experiences.

“We’ve all experienced an issue using a self-service checkout and had to wait for an overtaxed employee to come over to resolve it, an experience that can be far more challenging for elderly members of the community,” Lawson said. “This bill would provide options for the consumer by making sure staffed checkout lanes are always available while also improving the store environment for workers and consumers.”

Last week, the United Food and Commercial Workers International Union (UFCW) and UFCW Local 328 released statements celebrating the bill’s passage, calling it a major win for workers and shoppers.

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“UFCW Local 328 members in the grocery industry are often overburdened, having to monitor too many self-checkouts while shoppers face delays,” UFCW Local 328 Secretary-Treasurer Domenic Pontarelli said. “Staffing ratios fix this issue for all parties.”

“This technology has always been a raw deal for shoppers and workers, shifting the labor onto customers while taking hours away from workers,” UFCW International Vice President Ademola Oyefeso added. “We applaud the Rhode Island legislature for passing this bill, making it easier and faster for families to put food on the table, and we look forward to Governor McKee’s signature.”

Meanwhile, Scott Bromberg, president and CEO of the Rhode Island Food Dealers Association, expressed strong disdain for the measure, arguing that it puts traditional grocery stores at a “competitive disadvantage.”

“On behalf of the grocery industry, RIFDA has been vehemently opposed to self-checkout legislation,” Bromberg said in a statement to 12 News. “Our industry is being unfairly targeted, when checkout automation has spread to all retail environments including hardware stores, mass merchants,  dollar stores, pharmacies, and even fast-food chains.”

Bromberg also said the bill will only make it more difficult for Rhode Island grocery stores to operate “as they see fit,” noting that it could lead to longer lines and higher prices.

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“Grocery retailers run at razor thin margins and need flexibility to effectively and efficiently operate their stores, offer competitive prices, and provide great customer service,” he continued.

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Rhode Island

GETTING SUPPORT AT THE FORT – Jamestown Press

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GETTING SUPPORT AT THE FORT – Jamestown Press


Connie Slick, right, chats with Deanne Wright at the Rhode Island Direct Primary Care booth Tuesday at the senior center’s “Aging in Place” resource fair under the pavilion at Fort Getty. Photos by Andrea von Hohenleiten

Annie Murphy, from left, Joe Colon and Lea Verta at the Alzheimer’s Association booth.

Annie Murphy, from left, Joe Colon and Lea Verta at the Alzheimer’s Association booth.

Florence Iwuc learns about the warning signs of a stroke.

Florence Iwuc learns about the warning signs of a stroke.

Donna Mignella, right, talks to members of the Community Outreach and Support Team, Mary Meagher, from left, Becky Minus and Dave Pritchard.

Donna Mignella, right, talks to members of the Community Outreach and Support Team, Mary Meagher, from left, Becky Minus and Dave Pritchard.

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Susan Conant, left, and Andrea Maroto.

Susan Conant, left, and Andrea Maroto.

Vincent Ng, Barbara Cunha and John Andrews at the AARP booth.

Vincent Ng, Barbara Cunha and John Andrews at the AARP booth.



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