RI lawmakers weigh unlikely repeal of sales tax

Rhode Island lawmakers to review unlikely proposal to repeal state's sales tax

Associated Press

PROVIDENCE, R.I. (AP) -- While a proposal to eliminate Rhode Island's sales tax is likely to please taxpayers, it's unlikely to go anywhere in the General Assembly.

Nonetheless, the House Finance Committee plans to review the legislation Tuesday.

Sponsored by Democratic House Rep. Jan Malik of Warren, the legislation would repeal the 7 percent tax as of Oct. 1.

Malik says the sales tax burdens small businesses, particularly those with competitors in neighboring Massachusetts and Connecticut, where the sales tax is lower.

Abolishing the tax would cost some $900 million in annual state revenue. But Malik says his proposal could offset the loss by encouraging greater economic activity and increased income tax revenues.

Malik says he introduced the bill to start a dialogue on how to help make the state more competitive.

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