Legislative Update from your
Chamber of Commerce Coalition
Article 11, Section 7, Elimination of Sales Tax on Commercial Fuel. The Chamber testified in favor of the elimination of the 7% sales tax on heating fuel paid by commercial entities. Current Rhode Island law already exempts residential heating fuel from the state sales tax. It is well recognized that the state has very high energy costs. This Article seeks to lower energy bills in order to help existing businesses and to help attract new companies.
Article 11, Section 12, Earned Income Tax Credit. The Chamber testified in favor of the proposed increase to the Earned Income Tax Credit (EITC) as put forward by the Governor. Under current law Rhode Island provides a 10% EITC to low income households. The proposal increases the EITC to 12.5% in Tax Year 2016 and 15% in Tax year 2017. Rhode Island’s neighboring states offer higher credits of 27.5% (CT) and 15% (MA). Raising the EITC places money back into the hands of those who need it; but it also provides an incentive to work as the credit is based on earned income. This is a win/win situation for all parties.
Article 29, The Commerce Corporation. Governor Gina Raimondo testified personally at the House Finance Committee hearing Wednesday night to emphasize just how important this budget article is to her jobs plan for the State of Rhode Island. NRICC President John Gregory also testified in favor of the Article, calling attention to the need to address a lack economic development tools currently available to the Commerce Corporation to draw business to the state. Article 29 creates 15 distinct programs including, loans, grants, tuition reimbursement, direct investments and tax credit programs. Most of the money needed to fund these programs comes from savings achieved through restructuring of debt, but the Article also includes money from general revenue to make the programs work. The Article includes $1.8 million for an Anchor Institution program – a program born from a conversation with the NRICC Board of Directors – that give tax credits to businesses that encourage their suppliers to locate in Rhode Island and hire employees. Additionally, the Article includes $5.5 million to help small businesses obtain loans that otherwise are difficult to secure. To review the House Fiscal Staff analysis of Article 29, click here.
Below is a list of new legislation that was filed this week. The list contains bill numbers, links to the legislation, summary explanations and the Chamber’s position if applicable.
House Bill No. 6080, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- PRIVATE EMPLOYER IRA PROGRAM (Establishes a private employer IRA program allowing employees to contribute at least three percent (3%) of their payroll period wages with oversight by the state department of labor and training and the state investment commission.) The Chamber is reviewing this bill.
House Bill No. 6103, AN ACT RELATING TO TAXATION -- BUSINESS CORPORATION TAX (Reduces the minimum corporate tax to four hundred dollars ($400) for the 2016 tax year, three hundred dollars ($300) for the 2017 tax year, and two hundred fifty dollars ($250) for the 2018 tax year.) Chamber supports.
Senate Bill No. 844, AN ACT RELATING TO TOWNS AND CITIES -- ORDINANCES (Authorizes city and town councils to impose a penalty not to exceed two thousand dollars ($2,000) for municipal/environmental ordinance violations causing a substantial nuisance to the community.) The Chamber is reviewing this bill.
Because the legislature is on break during the week of April 20 – 25, Under the Dome will not be distributed next week, but will resume May 1st.