A 3.0% Sales Tax Is A Superior Reform

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Imagine Rhode Island as place where all of our state’s families could achieve their hopes and dreams. Sadly, there are many obstacles in the way of making this a reality. Here is a big one– the sales tax is a tax on business. Collectively, businesses pay almost half-of all sales taxes. Are their empty chairs at your dinner table? A 3.0% sales tax would make it easier for businesses and give real Rhode Islanders a reason to stay. A 3.0% sales tax would reduce costs across the board and improve our state’s last place business climate ranking. It is time for a superior reform. The Center’s proposed 3.0% sales tax reform would help working Rhode Islanders and businesses much more than would car tax repeal or free college tuition.

We appreciate that the Speaker and Governor both want see more Rhode Island families keep more of their hard-earned money. However, if we want to maximize the positive economic benefit for the people, we must conduct the proper due diligence and research to determine which course of action is most beneficial. We are offering well-researched projections from a credible economic modeling tool to add a third concept into this important debate. Any objective analysis of this data shows that sales tax cuts are the superior approach that would benefit Rhode Island families and businesses.

Among the takeaways of the analysis, which projected the impact of both the car tax and sales tax reform ideas, shows that a 3.0% sales tax would keep significantly more money in the pockets of Rhode Island families and businesses ($585,000,000 vs. $215,000,000!) Car tax repeal would only impact those businesses that have company owned vehicles. Rhode Island is losing the competition to retain and attract families who want to make our state their home-of-choice, where they can work hard, earn a respectable living, and support their families.

People want restored hope that government is working for them and to feel that they have not been forgotten. To accomplish this, a bold reform idea is clearly required. There are better solutions than the insider system. If only lawmakers were to realize that there are proven free market answers, like the superior sales tax reform, we could restore prosperity to the Ocean State. Your voice is powerful, and can change the way things happen on Smith Hill. It does not have to be this way. Demand that our elected officials take responsibility for improving the prosperity of families. I encourage you to speak out loudly against the way things are in our state.



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