law22231-06

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art.006/10/006/9/006/8/006/7/006/6/006/5/006/4/006/3/006/2/006/1

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ARTICLE 6 AS AMENDED

RELATING TO TAXES AND REVENUES

SECTION 1. Section 23-17-38.1 of the General Laws in Chapter 23-17 entitled “Licensing

of Health Care Facilities” is hereby amended to read as follows:

23-17-38.1. Hospitals -- Licensing fee.

(a) There is imposed a hospital licensing fee at the rate of six percent (6%) upon the net

patient-services revenue of every hospital for the hospital's first fiscal year ending on or after

January 1, 2018, except that the license fee for all hospitals located in Washington County, Rhode

Island shall be discounted by thirty-seven percent (37%). The discount for Washington County

hospitals is subject to approval by the Secretary of the U.S. Department of Health and Human

Services of a state plan amendment submitted by the executive office of health and human services

for the purpose of pursuing a waiver of the uniformity requirement for the hospital license fee. This

licensing fee shall be administered and collected by the tax administrator, division of taxation

within the department of revenue, and all the administration, collection, and other provisions of

Chapter 51 of title 44 shall apply. Every hospital shall pay the licensing fee to the tax administrator

on or before July 13, 2020, and payments shall be made by electronic transfer of monies to the

general treasurer and deposited to the general fund. Every hospital shall, on or before June 15,

2020, make a return to the tax administrator containing the correct computation of net patient-

services revenue for the hospital fiscal year ending September 30, 2018, and the licensing fee due

upon that amount. All returns shall be signed by the hospital's authorized representative, subject to

the pains and penalties of perjury.

(b) (a) There is also imposed a hospital licensing fee for state fiscal year 2021 against each

hospital in the state. The hospital licensing fee is equal to five percent (5.0%) of the net patient-

services revenue of every hospital for the hospital's first fiscal year ending on or after January 1,

2019, except that the license fee for all hospitals located in Washington County, Rhode Island shall

be discounted by thirty-seven percent (37%). The discount for Washington County hospitals is

subject to approval by the Secretary of the U.S. Department of Health and Human Services of a

state plan amendment submitted by the executive office of health and human services for the

purpose of pursuing a waiver of the uniformity requirement for the hospital license fee. This

licensing fee shall be administered and collected by the tax administrator, division of taxation

within the department of revenue, and all the administration, collection, and other provisions of

Chapter chapter 51 of title 44 shall apply. Every hospital shall pay the licensing fee to the tax

administrator on or before July 13, 2021, and payments shall be made by electronic transfer of

monies to the general treasurer and deposited to the general fund. Every hospital shall, on or before

June 15, 2020, make a return to the tax administrator containing the correct computation of net

patient-services revenue for the hospital fiscal year ending September 30, 2019, and the licensing

fee due upon that amount. All returns shall be signed by the hospital's authorized representative,

subject to the pains and penalties of perjury.

hospital in the state. The hospital licensing fee is equal to five and seven hundred twenty-five

thousandths percent (5.725%) five and six hundred fifty-six thousandths percent (5.656%) of the

net patient-services revenue of every hospital for the hospital's first fiscal year ending on or after

January 1, 2020, except that the license fee for all hospitals located in Washington County, Rhode

Island shall be discounted by thirty-seven percent (37%). The discount for Washington County

hospitals is subject to approval by the Secretary of the U.S. Department of Health and Human

Services of a state plan amendment submitted by the executive office of health and human services

for the purpose of pursuing a waiver of the uniformity requirement for the hospital license fee. This

licensing fee shall be administered and collected by the tax administrator, division of taxation

within the department of revenue, and all the administration, collection, and other provisions of

Chapter chapter 51 of title 44 shall apply. Every hospital shall pay the licensing fee to the tax

administrator on or before July 13, 2022, and payments shall be made by electronic transfer of

monies to the general treasurer and deposited to the general fund. Every hospital shall, on or before

June 15, 2022, make a return to the tax administrator containing the correct computation of net

patient-services revenue for the hospital fiscal year ending September 30, 2020, and the licensing

fee due upon that amount. All returns shall be signed by the hospital's authorized representative,

subject to the pains and penalties of perjury.

hospital in the state. The hospital licensing fee is equal to five and forty-two hundredths percent

(5.42%) of the net patient-services revenue of every hospital for the hospital's first fiscal year

ending on or after January 1, 2021, except that the license fee for all hospitals located in Washington

County, Rhode Island shall be discounted by thirty-seven percent (37%). The discount for

Washington County hospitals is subject to approval by the Secretary of the U.S. Department of

Health and Human Services of a state plan amendment submitted by the executive office of health

and human services for the purpose of pursuing a waiver of the uniformity requirement for the

hospital license fee. This licensing fee shall be administered and collected by the tax administrator,

division of taxation within the department of revenue, and all the administration, collection, and

other provisions of Chapter chapter 51 of title 44 shall apply. Every hospital shall pay the licensing

fee to the tax administrator on or before June 30, 2023, and payments shall be made by electronic

transfer of monies to the general treasurer and deposited to the general fund. Every hospital shall,

on or before May 25, 2023, make a return to the tax administrator containing the correct

computation of net patient-services revenue for the hospital fiscal year ending September 30, 2021,

and the licensing fee due upon that amount. All returns shall be signed by the hospital's authorized

representative, subject to the pains and penalties of perjury.

(d) For purposes of this section the following words and phrases have the following

meanings:

(1) "Hospital" means the actual facilities and buildings in existence in Rhode Island,

licensed pursuant to § 23-17-1 et seq. on June 30, 2010, and thereafter any premises included on

that license, regardless of changes in licensure status pursuant to chapter 17.14 of title 23 (hospital

conversions) and § 23-17-6(b) (change in effective control), that provides short-term acute inpatient

and/or outpatient care to persons who require definitive diagnosis and treatment for injury, illness,

disabilities, or pregnancy. Notwithstanding the preceding language, the negotiated Medicaid

managed care payment rates for a court-approved purchaser that acquires a hospital through

receivership, special mastership, or other similar state insolvency proceedings (which court-

approved purchaser is issued a hospital license after January 1, 2013) shall be based upon the newly

negotiated rates between the court-approved purchaser and the health plan, and such rates shall be

effective as of the date that the court-approved purchaser and the health plan execute the initial

agreement containing the newly negotiated rate. The rate-setting methodology for inpatient hospital

payments and outpatient hospital payments set forth in §§ 40-8-13.4(b) and 40-8-13.4(b)(2),

respectively, shall thereafter apply to negotiated increases for each annual twelve-month (12)

period as of July 1 following the completion of the first full year of the court-approved purchaser's

initial Medicaid managed care contract.

(2) "Gross patient-services revenue" means the gross revenue related to patient care

services.

(3) "Net patient-services revenue" means the charges related to patient care services less

(i) Charges attributable to charity care; (ii) Bad debt expenses; and (iii) Contractual allowances.

(e) The tax administrator shall make and promulgate any rules, regulations, and procedures

not inconsistent with state law and fiscal procedures that he or she deems necessary for the proper

administration of this section and to carry out the provisions, policy, and purposes of this section.

(f) The licensing fee imposed by subsection (b) (a) shall apply to hospitals as defined herein

that are duly licensed on July 1, 2020, and shall be in addition to the inspection fee imposed by §

23-17-38 and to any licensing fees previously imposed in accordance with this section.

(g) The licensing fee imposed by subsection (c) (b) shall apply to hospitals as defined

herein that are duly licensed on July 1, 2021, and shall be in addition to the inspection fee imposed

by § 23-17-38 and to any licensing fees previously imposed in accordance with this section.

(e)(h) The licensing fee imposed by subsection (c) shall apply to hospitals as defined herein

that are duly licensed on July 1, 2022, and shall be in addition to the inspection fee imposed by §

23-17-38 and to any licensing fees previously imposed in accordance with this section.

SECTION 2. Section 31-6-1 of the General Laws in Chapter 31-6 entitled "Registration

Fees" is hereby amended to read as follows:

31-6-1. Amount of registration and miscellaneous fees.

The following registration fees shall be paid to the division of motor vehicles for the

registration of motor vehicles, trailers, semi-trailers, and school buses subject to registration for

each year of registration:

(1) For the registration of every automobile, when equipped with pneumatic tires, the gross

weight of which is not more than four thousand pounds (4,000 lbs.): thirty dollars ($30.00).

(2) For the registration of every motor truck or tractor when equipped with pneumatic tires,

the gross weight of which is not more than four thousand pounds (4,000 lbs.): thirty-four dollars

($34.00).

(3) For the registration of every automobile, motor truck or tractor, when equipped with

pneumatic tires, the gross weight of which is:

(i) More than four thousand pounds (4,000 lbs.), but not more than five thousand pounds

(5,000 lbs.): forty dollars ($40.00);

(ii) More than five thousand pounds (5,000 lbs.), but not more than six thousand pounds

(6,000 lbs.): forty-eight dollars ($48.00);

(iii) More than six thousand pounds (6,000 lbs.), but not more than seven thousand pounds

(7,000 lbs.): fifty-six dollars ($56.00);

(iv) More than seven thousand pounds (7,000 lbs.), but not more than eight thousand

pounds (8,000 lbs.): sixty-four dollars ($64.00);

(v) More than eight thousand pounds (8,000 lbs.), but not more than nine thousand pounds

(9,000 lbs.): seventy dollars ($70.00);

(vi) More than nine thousand pounds (9,000 lbs.), but not more than ten thousand pounds

(10,000 lbs.): seventy-eight dollars ($78.00);

(vii) More than ten thousand pounds (10,000 lbs.), but not more than twelve thousand

pounds (12,000 lbs.): one hundred six dollars ($106);

(viii) More than twelve thousand pounds (12,000 lbs.), but not more than fourteen thousand

pounds (14,000 lbs.): one hundred twenty-four dollars ($124);

(ix) More than fourteen thousand pounds (14,000 lbs.), but not more than sixteen thousand

pounds (16,000 lbs.): one hundred forty dollars ($140);

(x) More than sixteen thousand pounds (16,000 lbs.), but not more than eighteen thousand

pounds (18,000 lbs.): one hundred fifty-eight dollars ($158);

(xi) More than eighteen thousand pounds (18,000 lbs.), but not more than twenty thousand

pounds (20,000 lbs.): one hundred seventy-six dollars ($176);

(xii) More than twenty thousand pounds (20,000 lbs.), but not more than twenty-two

thousand pounds (22,000 lbs.): one hundred ninety-four dollars ($194);

(xiii) More than twenty-two thousand pounds (22,000 lbs.), but not more than twenty-four

thousand pounds (24,000 lbs.): two hundred ten dollars ($210);

(xiv) More than twenty-four thousand pounds (24,000 lbs.), but not more than twenty-six

thousand pounds (26,000 lbs.): two hundred thirty dollars ($230);

(xv) More than twenty-six thousand pounds (26,000 lbs.), but not more than twenty-eight

thousand pounds (28,000 lbs.): two hundred ninety-six dollars ($296);

(xvi) More than twenty-eight thousand pounds (28,000 lbs.), but not more than thirty

thousand pounds (30,000 lbs.): three hundred sixteen dollars ($316);

(xvii) More than thirty thousand pounds (30,000 lbs.), but not more than thirty-two

thousand pounds (32,000 lbs.): four hundred and twenty-two dollars ($422);

(xviii) More than thirty-two thousand pounds (32,000 lbs.), but not more than thirty-four

thousand pounds (34,000 lbs.): four hundred and forty-eight dollars ($448);

(xix) More than thirty-four thousand pounds (34,000 lbs.), but not more than thirty-six

thousand pounds (36,000 lbs.): four hundred and seventy-six dollars ($476);

(xx) More than thirty-six thousand pounds (36,000 lbs.), but not more than thirty-eight

thousand pounds (38,000 lbs.): five hundred and two dollars ($502);

(xxi) More than thirty-eight thousand pounds (38,000 lbs.), but not more than forty

thousand pounds (40,000 lbs.): five hundred and twenty-eight dollars ($528);

(xxii) More than forty thousand pounds (40,000 lbs.), but not more than forty-two thousand

pounds (42,000 lbs.): five hundred and fifty-four dollars ($554);

(xxiii) More than forty-two thousand pounds (42,000 lbs.), but not more than forty-six

thousand pounds (46,000 lbs.): six hundred and eight dollars ($608);

(xxiv) More than forty-six thousand pounds (46,000 lbs.), but not more than fifty thousand

pounds (50,000 lbs.): six hundred and sixty dollars ($660);

(xxv) More than fifty thousand pounds (50,000 lbs.), but not more than fifty-four thousand

pounds (54,000 lbs.): seven hundred and twelve dollars ($712);

(xxvi) More than fifty-four thousand pounds (54,000 lbs.), but not more than fifty-eight

thousand pounds (58,000 lbs.): seven hundred and sixty-eight dollars ($768);

(xxvii) More than fifty-eight thousand pounds (58,000 lbs.), but not more than sixty-two

thousand pounds (62,000 lbs.): eight hundred and sixteen dollars ($816);

(xxviii) More than sixty-two thousand pounds (62,000 lbs.), but not more than sixty-six

thousand pounds (66,000 lbs.): eight hundred and seventy-six dollars ($876);

(xxix) More than sixty-six thousand pounds (66,000 lbs.), but not more than seventy

thousand pounds (70,000 lbs.): nine hundred and twenty-four dollars ($924);

(xxx) More than seventy thousand pounds (70,000 lbs.), but not more than seventy-four

thousand pounds (74,000 lbs.): nine hundred and seventy-two dollars ($972);

(xxxi) Over seventy-four thousand pounds (74,000 lbs.): nine hundred and seventy-two

dollars ($972), plus twenty-four dollars ($24.00) per two thousand pounds (2,000 lbs.) gross

weight.

(4) For the registration of every semi-trailer to be used with a truck-tractor, as defined in §

31-1-4(f), shall be as follows: an annual fee of twelve dollars ($12.00) for a one-year registration;

for multi-year registrations the fee of fifty dollars ($50.00) for a five-year (5) registration; and

eighty dollars ($80.00) for an eight-year (8) registration. However, when in use, the weight of the

resulting semi-trailer unit and its maximum carrying capacity shall not exceed the gross weight of

the original semi-trailer unit from which the gross weight of the tractor was determined. A

registration certificate and registration plate shall be issued for each semi-trailer so registered.

There shall be no refund of payment of such fee, except that when a plate is returned prior to ninety

(90) days before the effective date of that year's registration, the pro rate amount, based on the

unused portion of the multi-year registration plate period at time of surrender, shall be refunded. A

multi-year semi-trailer registration may be transferred to another semi-trailer subject to the

provisions and fee set forth in § 31-6-11. Thirty percent (30%) of the semi-trailer registration fee

shall be retained by the division of motor vehicles to defray the costs of implementation of the

international registration plan (IRP) and fleet registration section.

(5) For the registration of every automobile, motor truck, or tractor, when equipped with

other than pneumatic tires, there shall be added to the above gross weight fees a charge of ten cents

(10¢) for each one hundred pounds (100 lbs.) of gross weight.

(6) For the registration of every public bus, the rates provided for motor vehicles for hire

plus two dollars ($2.00) for each passenger that bus is rated to carry, the rating to be determined by

the administrator of the division of motor vehicles.

(7) For the registration of every motorcycle, or motor-driven cycle, thirteen dollars

($13.00). Three dollars ($3.00) from that sum shall be turned over to the department of education

to assist in the payment of the cost of the motorcycle driver's education program as enumerated in

§ 31-10.1-1.1.

(8) For the registration of every trailer, not including semi-trailers used with a truck-tractor

as defined in § 31-1-4(d), with a gross weight of three thousand pounds (3,000 lbs.) or less, five

dollars ($5.00). Trailers with a gross weight of more than three thousand pounds (3,000 lbs.) shall

be assessed a registration fee of one dollar and fifty cents ($1.50) per thousand pounds (1,000 lbs.).

(9) The annual registration fee for a motor vehicle, commonly described as a boxcar and/or

locomotive, and used only by La Societe Des 40 Hommes et 8 Chevaux for civic demonstration,

parades, convention purposes, or social welfare work, shall be two dollars ($2.00).

(10) For the registration of every motor vehicle, trailer, or semi-trailer owned by any

department or agency of any city or town or district, provided the name of the city or town or

district or state department or agency owning the same shall be plainly printed on two (2) sides of

the vehicle, two dollars ($2.00).

(11) For the registration of motor vehicles used for racing, fifteen dollars ($15.00).

(12) For every duplicate registration certificate, seventeen dollars ($17.00).

(13) For every certified copy of a registration certificate or application, ten dollars ($10.00).

(14) For every certificate assigning a special identification number or mark as provided in

§ 31-3-37, one dollar ($1.00).

(15) For every replacement of number plates or additional pair of number plates, without

changing the number, thirty dollars ($30.00).

(16) For the registration of every farm vehicle, used in farming as provided in § 31-3-31:

ten dollars ($10.00).

(17) For the registration of antique motor vehicles, five dollars ($5.00).

(18) For the registration of a suburban vehicle, when used as a pleasure vehicle and the

gross weight of which is not more than four thousand pounds (4,000 lbs.), the same rates as charged

in subsection (1) of this section shall be applicable and when used as a commercial vehicle and the

gross weight of which is not more than four thousand pounds (4,000 lbs.), the same rates as

provided in subsection (2) of this section shall be applicable. The rates in subsection (3) of this

section shall be applicable when the suburban vehicle has a gross weight of more than four thousand

pounds (4,000 lbs.), regardless of the use of the vehicle.

(19) For the registration of every motor bus that is used exclusively under contract with a

political subdivision or school district of the state for the transportation of school children, twenty-

five dollars ($25); provided that the motor bus may also be used for the transportation of persons

to and from church and Sunday school services, and for the transportation of children to and from

educational or recreational projects sponsored by a city or town or by any association or

organization supported wholly or in part by public or private donations for charitable purposes,

without the payment of additional registration fee.

(20) For the registration of every motorized bicycle, ten dollars ($10.00).

(21) For the registration of every motorized tricycle, ten dollars ($10.00).

(22) For the replacement of number plates with a number change, twenty dollars ($20.00).

(23) For the initial issuance and each reissuance of fully reflective plates, as required by §§

31-3-10, 31-3-32, and 31-3-33, an additional eight dollars ($8.00); provided, however, for the initial

issuance of new license plates as required by § 31-3-33(c) that feature the 2022 approved design,

the fee shall be waived when the plate is issued for a vehicle with an existing registration.

(24) For the issuance of a trip permit under the International Registration Plan, twenty-five

dollars ($25.00) per vehicle. The division of motor vehicles is authorized to issue seventy-two-hour

(72) trip permits for vehicles required to be registered in the International Registration Plan that

have not been apportioned with the state of Rhode Island.

(25) For the issuance of a hunter's permit under the International Registration Plan, twenty-

five dollars ($25.00) per vehicle. The division of motor vehicles is authorized to issue hunter's

permits for motor vehicles based in the state of Rhode Island and otherwise required to be registered

in the International Registration Plan. These permits are valid for thirty (30) days.

(26) For the registration of a specially adapted motor vehicle necessary to transport a family

member with a disability for personal, noncommercial use, a fee of thirty dollars ($30.00) assessed.

SECTION 3. Section 42-61-15 of the General Laws in Chapter 42-61 entitled "State

Lottery" is hereby amended to read as follows:

42-61-15. State lottery fund.

(a) There is created the state lottery fund, into which shall be deposited all revenues

received by the division from the sales of lottery tickets and license fees. The fund shall be in the

custody of the general treasurer, subject to the direction of the division for the use of the division,

and money shall be disbursed from it on the order of the controller of the state, pursuant to vouchers

or invoices signed by the director and certified by the director of administration. The moneys in the

state lottery fund shall be allotted in the following order, and only for the following purposes:

(1) Establishing a prize fund from which payments of the prize awards shall be disbursed

to holders of winning lottery tickets on checks signed by the director and countersigned by the

controller of the state or his or her designee.

(i) The amount of payments of prize awards to holders of winning lottery tickets shall be

determined by the division, but shall not be less than forty-five percent (45%) nor more than sixty-

five percent (65%) seventy-one percent (71%) of the total revenue accruing from the sale of lottery

tickets;

(ii) For the lottery game commonly known as "Keno," the amount of prize awards to

holders of winning Keno tickets shall be determined by the division, but shall not be less than forty-

five percent (45%) nor more than seventy-two percent (72%) of the total revenue accruing from

the sale of Keno tickets;

(2) Payment of expenses incurred by the division in the operation of the state lotteries

including, but not limited to, costs arising from contracts entered into by the director for

promotional, consulting, or operational services, salaries of professional, technical, and clerical

assistants, and purchases or lease of facilities, lottery equipment, and materials; provided however,

solely for the purpose of determining revenues remaining and available for transfer to the state's

general fund, expenses incurred by the division in the operation of state lotteries shall reflect (i)

Beginning in fiscal year 2015, the actuarially determined employer contribution to the Employees'

Retirement System consistent with the state's adopted funding policy; and (ii) Beginning in fiscal

year 2018, the actuarially determined employer contribution to the State Employees and Electing

Teachers' OPEB System consistent with the state's adopted funding policy. For financial reporting

purposes, the state lottery fund financial statements shall be prepared in accordance with generally

accepted accounting principles as promulgated by the Governmental Accounting Standards Board;

and

(3) Payment into the general revenue fund of all revenues remaining in the state lottery

fund after the payments specified in subsections (a)(1) -- (a)(2) of this section.

(b) The auditor general shall conduct an annual post audit of the financial records and

operations of the lottery for the preceding year in accordance with generally accepted auditing

standards and government auditing standards. In connection with the audit, the auditor general may

examine all records, files, and other documents of the division, and any records of lottery sales

agents that pertain to their activities as agents, for purposes of conducting the audit. The auditor

general, in addition to the annual post audit, may require or conduct any other audits or studies he

or she deems appropriate, the costs of which shall be borne by the division.

be made on an estimated quarterly basis. Payment shall be made on the tenth business day following

the close of the quarter except for the fourth quarter when payment shall be on the last business

day.

SECTION 4. Section 44-1-7 of the General Laws in Chapter 44-1 entitled "State Tax

Officials" is hereby amended to read as follows:

44-1-7. Interest on delinquent payments.

(a) Whenever the full amount of any state tax or any portion or deficiency, as finally

determined by the tax administrator, has not been paid on the date when it is due and payable,

whether the time has been extended or not, there shall be added as part of the tax or portion or

deficiency interest at the rate as determined in accordance with subsection (b) of this section,

notwithstanding any general or specific statute to the contrary.

(b) Each January 1 the tax administrator shall compute the rate of interest to be in effect

for that calendar year by adding two percent (2%) to the prime rate, which was in effect on October

1 of the preceding year, except:

(1) Before January 1, 2023, iIn no event shall the rate of interest exceed twenty-one percent

(21%) per annum nor be less than eighteen percent (18%) per annum;.

(2) On and after January 1, 2023, in no event shall the rate of interest exceed twenty-one

percent (21%) per annum nor be less than twelve percent (12%) per annum except:

(A) (i) for For trust fund taxes as established by §§ 44-19-35 and 44-30-76, in no event

shall the rate of interest exceed twenty-one percent (21%) per annum nor be less than eighteen

percent (18%) per annum.

quoted by commercial banks to large businesses as determined by the board of governors of the

Federal Reserve System.

(d) Notwithstanding any provisions of the general laws to the contrary, the tax

administrator shall waive interest and penalty on the taxable portion of each Paycheck Protection

Program loan taxed pursuant to §§ 44-11-11(a)(1)(iv), 44-14-11, and 44-30-12(b)(8) and forgiven

during tax year 2020 provided that the tax on that portion is paid in full on or before March 31,

2022. The tax administrator shall make available suitable forms with instructions for making tax

payments on the taxable portion of such forgiven Paycheck Protection Program loans.

SECTION 5. Chapter 44-1 of the General Laws entitled "State Tax Officials" is hereby

amended by adding thereto the following section:

44-1-31.2. Electronic filing of large entity tax returns, electronic payments, and

penalties..

(a) For the purposes of this chapter, "larger business registrant" means any person who:

(1) Operates as a business whose combined annual liability for all taxes administered by

the division of taxation for the entity is or exceeds five thousand dollars ($5,000); or

(2) Operated as a business whose annual gross income is over one hundred thousand dollars

($100,000) for the entity.

(b) Beginning on January 1, 2023, any larger business registrant is required to file returns

and remit taxes to the State state of Rhode Island electronically.

by electronic funds transfer or other electronic means defined by the tax administrator as required

hereunder, there shall be added to the amount of tax the lesser of five percent (5%) of the tax

liability amount that was not filed electronically or five hundred dollars ($500), whichever is less,

unless there was reasonable cause for the failure and such failure was not due to negligence or

willful neglect.

(d) Notwithstanding the provisions of subsection (c) of this section, beginning on January

1, 2023, if any larger business registrant fails to file a return by electronic means defined by the tax

administrator as required hereunder, there shall be added to the amount of tax equal to fifty dollars

($50.00), unless there was reasonable cause for the failure and such failure was not due to

negligence or willful neglect.

SECTION 6. Section 44-3-3 of the General Laws in Chapter 44-3 entitled "Property

Subject to Taxation" is hereby amended to read as follows:

44-3-3. Property exempt. [Effective January 1, 2022.]

(a) The following property is exempt from taxation:

(1) Property belonging to the state, except as provided in § 44-4-4.1;

(2) Lands ceded or belonging to the United States;

(3) Bonds and other securities issued and exempted from taxation by the government of

the United States or of this state;

(4) Real estate, used exclusively for military purposes, owned by chartered or incorporated

organizations approved by the adjutant general and composed of members of the national guard,

the naval militia, or the independent, chartered-military organizations;

(5) Buildings for free public schools, buildings for religious worship, and the land upon

which they stand and immediately surrounding them, to an extent not exceeding five (5) acres so

far as the buildings and land are occupied and used exclusively for religious or educational

purposes;

(6) Dwellings houses and the land on which they stand, not exceeding one acre in size, or

the minimum lot size for zone in which the dwelling house is located, whichever is the greater,

owned by, or held in trust for, any religious organization and actually used by its officiating clergy;

provided, further, that in the town of Charlestown, where the property previously described in this

paragraph is exempt in total, along with dwelling houses and the land on which they stand in

Charlestown, not exceeding one acre in size, or the minimum lot size for zone in which the dwelling

house is located, whichever is the greater, owned by, or held in trust for, any religious organization

and actually used by its officiating clergy, or used as a convent, nunnery, or retreat center by its

religious order;

(7) Intangible personal property owned by, or held in trust for, any religious or charitable

organization, if the principal or income is used or appropriated for religious or charitable purposes;

(8) Buildings and personal estate owned by any corporation used for a school, academy, or

seminary of learning, and of any incorporated public charitable institution, and the land upon which

the buildings stand and immediately surrounding them to an extent not exceeding one acre, so far

as they are used exclusively for educational purposes, but no property or estate whatever is hereafter

exempt from taxation in any case where any part of its income or profits, or of the business carried

on there, is divided among its owners or stockholders; provided, however, that unless any private

nonprofit corporation organized as a college or university located in the town of Smithfield reaches

a memorandum of agreement with the town of Smithfield, the town of Smithfield shall bill the

actual costs for police, fire, and rescue services supplied, unless otherwise reimbursed, to said

corporation commencing March 1, 2014;

(9) Estates, persons, and families of the president and professors for the time being of

Brown University for not more than ten thousand dollars ($10,000) for each officer, the officer's

estate, person, and family included, but only to the extent that any person had claimed and utilized

the exemption prior to, and for a period ending, either on or after December 31, 1996;

(10) Property especially exempt by charter unless the exemption has been waived in whole

or in part;

(11) Lots of land exclusively for burial grounds;

(12) Property, real and personal, held for, or by, an incorporated library, society, or any

free public library, or any free public library society, so far as the property is held exclusively for

library purposes, or for the aid or support of the aged poor, or poor friendless children, or the poor

generally, or for a nonprofit hospital for the sick or disabled;

(13) Real or personal estate belonging to, or held in trust for, the benefit of incorporated

organizations of veterans of any war in which the United States has been engaged, the parent body

of which has been incorporated by act of Congress, to the extent of four hundred thousand dollars

($400,000) if actually used and occupied by the association; provided, that the city council of the

city of Cranston may by ordinance exempt the real or personal estate as previously described in

this subdivision located within the city of Cranston to the extent of five hundred thousand dollars

($500,000);

(14) Property, real and personal, held for, or by, the fraternal corporation, association, or

body created to build and maintain a building or buildings for its meetings or the meetings of the

general assembly of its members, or subordinate bodies of the fraternity, and for the

accommodation of other fraternal bodies or associations, the entire net income of which real and

personal property is exclusively applied or to be used to build, furnish, and maintain an asylum or

asylums, a home or homes, a school or schools, for the free education or relief of the members of

the fraternity, or the relief, support, and care of worthy and indigent members of the fraternity, their

wives, widows, or orphans, and any fund given or held for the purpose of public education,

almshouses, and the land and buildings used in connection therewith;

(15) Real estate and personal property of any incorporated volunteer fire engine company

or incorporated volunteer ambulance or rescue corps in active service;

(16) The estate of any person who, in the judgment of the assessors, is unable from infirmity

or poverty to pay the tax; provided, that in the towns of Burrillville and West Greenwich, the tax

shall constitute a lien for five (5) years on the property where the owner is entitled to the exemption.

At the expiration of five (5) years, the lien shall be abated in full. Provided, if the property is sold

or conveyed, or if debt secured by the property is refinanced during the five-year (5) period, the

lien immediately becomes due and payable; any person claiming the exemption aggrieved by an

adverse decision of an assessor shall appeal the decision to the local board of tax review and

thereafter according to the provisions of § 44-5-26;

(17) Household furniture and family stores of a housekeeper in the whole, including

clothing, bedding, and other white goods, books, and all other tangible personal property items that

are common to the normal household;

(18) Improvements made to any real property to provide a shelter and fallout protection

from nuclear radiation, to the amount of one thousand five hundred dollars ($1,500); provided, that

the improvements meet applicable standards for shelter construction established, from time to time,

by the Rhode Island emergency management agency. The improvements are deemed to comply

with the provisions of any building code or ordinance with respect to the materials or the methods

of construction used and any shelter or its establishment is deemed to comply with the provisions

of any zoning code or ordinance;

(19) Aircraft for which the fee required by § 1-4-6 has been paid to the tax administrator;

(20) Manufacturer's inventory.

(i) For the purposes of §§ 44-4-10, 44-5-3, 44-5-20, and 44-5-38, a person is deemed to be

a manufacturer within a city or town within this state if that person uses any premises, room, or

place in it primarily for the purpose of transforming raw materials into a finished product for trade

through any or all of the following operations: adapting, altering, finishing, making, and

ornamenting; provided, that public utilities; non-regulated power producers commencing

commercial operation by selling electricity at retail or taking title to generating facilities on or after

July 1, 1997; building and construction contractors; warehousing operations, including distribution

bases or outlets of out-of-state manufacturers; and fabricating processes incidental to warehousing

or distribution of raw materials, such as alteration of stock for the convenience of a customer; are

excluded from this definition;

(ii) For the purposes of this section and §§ 44-4-10 and 44-5-38, the term "manufacturer's

inventory," or any similar term, means and includes the manufacturer's raw materials, the

manufacturer's work in process, and finished products manufactured by the manufacturer in this

state, and not sold, leased, or traded by the manufacturer or its title or right to possession divested;

provided, that the term does not include any finished products held by the manufacturer in any retail

store or other similar selling place operated by the manufacturer whether or not the retail

establishment is located in the same building in which the manufacturer operates the manufacturing

plant;

(iii) For the purpose of § 44-11-2, a "manufacturer" is a person whose principal business

in this state consists of transforming raw materials into a finished product for trade through any or

all of the operations described in paragraph (i) of this subdivision. A person will be deemed to be

principally engaged if the gross receipts that person derived from the manufacturing operations in

this state during the calendar year or fiscal year mentioned in § 44-11-1 amounted to more than

fifty percent (50%) of the total gross receipts that person derived from all the business activities in

which that person engaged in this state during the taxable year. For the purpose of computing the

percentage, gross receipts derived by a manufacturer from the sale, lease, or rental of finished

products manufactured by the manufacturer in this state, even though the manufacturer's store or

other selling place may be at a different location from the location of the manufacturer's

manufacturing plant in this state, are deemed to have been derived from manufacturing;

(iv) Within the meaning of the preceding paragraphs of this subdivision, the term

"manufacturer" also includes persons who are principally engaged in any of the general activities

coded and listed as establishments engaged in manufacturing in the Standard Industrial

Classification Manual prepared by the Technical Committee on Industrial Classification, Office of

Statistical Standards, Executive Office of the President, United States Bureau of the Budget, as

revised from time to time, but eliminating as manufacturers those persons, who, because of their

limited type of manufacturing activities, are classified in the manual as falling within the trade

rather than an industrial classification of manufacturers. Among those thus eliminated, and

accordingly also excluded as manufacturers within the meaning of this paragraph, are persons

primarily engaged in selling, to the general public, products produced on the premises from which

they are sold, such as neighborhood bakeries, candy stores, ice cream parlors, shade shops, and

custom tailors, except, that a person who manufactures bakery products for sale primarily for home

delivery, or through one or more non-baking retail outlets, and whether or not retail outlets are

operated by the person, is a manufacturer within the meaning of this paragraph;

(v) The term "Person" means and includes, as appropriate, a person, partnership, or

corporation; and

(vi) The department of revenue shall provide to the local assessors any assistance that is

necessary in determining the proper application of the definitions in this subdivision;

(21) Real and tangible personal property acquired to provide a treatment facility used

primarily to control the pollution or contamination of the waters or the air of the state, as defined

in chapter 12 of title 46 and chapter 25 of title 23, respectively, the facility having been constructed,

reconstructed, erected, installed, or acquired in furtherance of federal or state requirements or

standards for the control of water or air pollution or contamination, and certified as approved in an

order entered by the director of environmental management. The property is exempt as long as it is

operated properly in compliance with the order of approval of the director of environmental

management; provided, that any grant of the exemption by the director of environmental

management in excess of ten (10) years is approved by the city or town in which the property is

situated. This provision applies only to water and air pollution control properties and facilities

installed for the treatment of waste waters and air contaminants resulting from industrial

processing; furthermore, it applies only to water or air pollution control properties and facilities

placed in operation for the first time after April 13, 1970;

(22) Manufacturing machinery and equipment acquired or used by a manufacturer after

December 31, 1974. Manufacturing machinery and equipment is defined as:

(i) Machinery and equipment used exclusively in the actual manufacture or conversion of

raw materials or goods in the process of manufacture by a manufacturer, as defined in subdivision

(20), and machinery, fixtures, and equipment used exclusively by a manufacturer for research and

development or for quality assurance of its manufactured products;

(ii) Machinery and equipment that is partially used in the actual manufacture or conversion

of raw materials or goods in process of manufacture by a manufacturer, as defined in subdivision

(20), and machinery, fixtures, and equipment used by a manufacturer for research and development

or for quality assurance of its manufactured products, to the extent to which the machinery and

equipment is used for the manufacturing processes, research and development, or quality assurance.

In the instances where machinery and equipment is used in both manufacturing and/or research and

development and/or quality assurance activities and non-manufacturing activities, the assessment

on machinery and equipment is prorated by applying the percentage of usage of the equipment for

the manufacturing, research and development, and quality-assurance activity to the value of the

machinery and equipment for purposes of taxation, and the portion of the value used for

manufacturing, research and development, and quality assurance is exempt from taxation. The

burden of demonstrating this percentage usage of machinery and equipment for manufacturing and

for research and development and/or quality assurance of its manufactured products rests with the

manufacturer; and

(iii) Machinery and equipment described in §§ 44-18-30(7) and 44-18-30(22) that was

purchased after July 1, 1997; provided that the city or town council of the city or town in which the

machinery and equipment is located adopts an ordinance exempting the machinery and equipment

from taxation. For purposes of this subsection, city councils and town councils of any municipality

may, by ordinance, wholly or partially exempt from taxation the machinery and equipment

discussed in this subsection for the period of time established in the ordinance and may, by

ordinance, establish the procedures for taxpayers to avail themselves of the benefit of any

exemption permitted under this section; provided, that the ordinance does not apply to any

machinery or equipment of a business, subsidiary, or any affiliated business that locates or relocates

from a city or town in this state to another city or town in the state;

(23) Precious metal bullion, meaning any elementary metal that has been put through a

process of melting or refining, and that is in a state or condition that its value depends upon its

content and not its form. The term does not include fabricated precious metal that has been

processed or manufactured for some one or more specific and customary industrial, professional,

or artistic uses;

(24) Hydroelectric power-generation equipment, which includes, but is not limited to,

turbines, generators, switchgear, controls, monitoring equipment, circuit breakers, transformers,

protective relaying, bus bars, cables, connections, trash racks, headgates, and conduits. The

hydroelectric power-generation equipment must have been purchased after July 1, 1979, and

acquired or used by a person or corporation who or that owns or leases a dam and utilizes the

equipment to generate hydroelectric power;

(25) Subject to authorization by formal action of the council of any city or town, any real

or personal property owned by, held in trust for, or leased to an organization incorporated under

chapter 6 of title 7, as amended, or an organization meeting the definition of "charitable trust" set

out in § 18-9-4, as amended, or an organization incorporated under the not-for-profits statutes of

another state or the District of Columbia, the purpose of which is the conserving of open space, as

that term is defined in chapter 36 of title 45, as amended, provided the property is used exclusively

for the purposes of the organization;

(26) Tangible personal property, the primary function of which is the recycling, reuse, or

recovery of materials (other than precious metals, as defined in § 44-18-30(24)(ii) and (iii)), from,

or the treatment of "hazardous wastes," as defined in § 23-19.1-4, where the "hazardous wastes"

are generated primarily by the same taxpayer and where the personal property is located at, in, or

adjacent to a generating facility of the taxpayer. The taxpayer may, but need not, procure an order

from the director of the department of environmental management certifying that the tangible

personal property has this function, which order effects a conclusive presumption that the tangible

personal property qualifies for the exemption under this subdivision. If any information relating to

secret processes or methods of manufacture, production, or treatment is disclosed to the department

of environmental management only to procure an order, and is a "trade secret" as defined in § 28-

21-10(b), it shall not be open to public inspection or publicly disclosed unless disclosure is

otherwise required under chapter 21 of title 28 or chapter 24.4 of title 23;

(27) Motorboats as defined in § 46-22-2 for which the annual fee required in § 46-22-4 has

been paid;

(28) Real and personal property of the Providence Performing Arts Center, a non-business

corporation as of December 31, 1986;

(29) Tangible personal property owned by, and used exclusively for the purposes of, any

religious organization located in the city of Cranston;

(30) Real and personal property of the Travelers Aid Society of Rhode Island, a nonprofit

corporation, the Union Mall Real Estate Corporation, and any limited partnership or limited liability

company that is formed in connection with, or to facilitate the acquisition of, the Providence YMCA

Building;

(31) Real and personal property of Meeting Street Center or MSC Realty, Inc., both not-

for-profit Rhode Island corporations, and any other corporation, limited partnership, or limited

liability company that is formed in connection with, or to facilitate the acquisition of, the properties

designated as the Meeting Street National Center of Excellence on Eddy Street in Providence,

Rhode Island;

(32) The buildings, personal property, and land upon which the buildings stand, located on

Pomham Island, East Providence, currently identified as Assessor's Map 211, Block 01, Parcel

001.00, that consists of approximately twenty-one thousand three hundred (21,300) square feet and

is located approximately eight hundred sixty feet (860′), more or less, from the shore, and limited

exclusively to these said buildings, personal estate and land, provided that said property is owned

by a qualified 501(c)(3) organization, such as the American Lighthouse Foundation, and is used

exclusively for a lighthouse;

(33) The Stadium Theatre Performing Arts Centre building located in Monument Square,

Woonsocket, Rhode Island, so long as said Stadium Theatre Performing Arts Center is owned by

the Stadium Theatre Foundation, a Rhode Island nonprofit corporation;

(34) Real and tangible personal property of St. Mary Academy — Bay View, located in

East Providence, Rhode Island;

(35) Real and personal property of East Bay Community Action Program and its

predecessor, Self Help, Inc; provided, that the organization is qualified as a tax-exempt corporation

under § 501(c)(3) of the United States Internal Revenue Code;

(36) Real and personal property located within the city of East Providence of the Columbus

Club of East Providence, a Rhode Island charitable nonprofit corporation;

(37) Real and personal property located within the city of East Providence of the Columbus

Club of Barrington, a Rhode Island charitable nonprofit corporation;

(38) Real and personal property located within the city of East Providence of Lodge 2337

BPO Elks, a Rhode Island nonprofit corporation;

(39) Real and personal property located within the city of East Providence of the St.

Andrews Lodge No. 39, a Rhode Island charitable nonprofit corporation;

(40) Real and personal property located within the city of East Providence of the Trustees

of Methodist Health and Welfare service a/k/a United Methodist Elder Care, a Rhode Island

nonprofit corporation;

(41) Real and personal property located on the first floor of 90 Leonard Avenue within the

city of East Providence of the Zion Gospel Temple, Inc., a religious nonprofit corporation;

(42) Real and personal property located within the city of East Providence of the Cape

Verdean Museum Exhibit, a Rhode Island nonprofit corporation;

(43) The real and personal property owned by a qualified 501(c)(3) organization that is

affiliated and in good standing with a national, congressionally chartered organization and thereby

adheres to that organization's standards and provides activities designed for recreational,

educational, and character building purposes for children from ages six (6) years to seventeen (17)

years;

(44) Real and personal property of the Rhode Island Philharmonic Orchestra and Music

School; provided, that the organization is qualified as a tax-exempt corporation under § 501(c)(3)

of the United States Internal Revenue Code;

(45) The real and personal property located within the town of West Warwick at 211

Cowesett Avenue, Plat 29-Lot 25, which consists of approximately twenty-eight thousand seven

hundred fifty (28,750) square feet and is owned by the Station Fire Memorial Foundation of East

Greenwich, a Rhode Island nonprofit corporation;

(46) Real and personal property of the Comprehensive Community Action Program, a

qualified tax-exempt corporation under § 501(c)(3) of the United States Internal Revenue Code;

(47) Real and personal property located at 52 Plain Street, within the city of Pawtucket of

the Pawtucket Youth Soccer Association, a Rhode Island nonprofit corporation;

(48) Renewable energy resources, as defined in § 39-26-5, used in residential systems and

associated equipment used therewith in service after December 31, 2015;

(49) Renewable energy resources, as defined in § 39-26-5, if employed by a manufacturer,

as defined in subsection (a) of this section, shall be exempt from taxation in accordance with

subsection (a) of this section;

(50) Real and personal property located at 415 Tower Hill Road within the town of North

Kingstown, of South County Community Action, Inc., a qualified tax-exempt corporation under §

501(c)(3) of the United States Internal Revenue Code;

(51) As an effort to promote business growth, tangible business or personal property, in

whole or in part, within the town of Charlestown's community limits, subject to authorization by

formal action of the town council of the town of Charlestown;

(52) All real and personal property located at 1300 Frenchtown Road, within the town of

East Greenwich, identified as assessor's map 027, plat 019, lot 071, and known as the New England

Wireless and Steam Museum, Inc., a qualified tax-exempt corporation under § 501(c)(3) of the

United States Internal Revenue Code;

(53) Real and tangible personal property of Mount Saint Charles Academy located within

the city of Woonsocket, specifically identified as the following assessor's plats and lots: Logee

Street, plat 23, lot 62, Logee Street, plat 24, lots 304 and 305; Welles Street, plat 23, lot 310;

Monroe Street, plat 23, lot 312; and Roberge Avenue, plat 24, lot 47;

(54) Real and tangible personal property of Steere House, a Rhode Island nonprofit

corporation, located in Providence, Rhode Island;

(55) Real and personal property located within the town of West Warwick of Tides Family

Services, Inc., a Rhode Island nonprofit corporation;

(56) Real and personal property of Tides Family Services, Inc., a Rhode Island nonprofit

corporation, located in the city of Pawtucket at 242 Dexter Street, plat 44, lot 444;

(57) Real and personal property located within the town of Middletown of Lucy's Hearth,

a Rhode Island nonprofit corporation;

(58) Real and tangible personal property of Habitat for Humanity of Rhode Island—

Greater Providence, Inc., a Rhode Island nonprofit corporation, located in Providence, Rhode

Island;

(59) Real and personal property of the Artic Playhouse, a Rhode Island nonprofit

corporation, located in the town of West Warwick at 1249 Main Street;

(60) Real and personal property located at 321 Main Street, within the town of South

Kingstown, of the Contemporary Theatre Company, a qualified, tax-exempt corporation under §

501(c)(3) of the United States Internal Revenue Code;

(61) Real and personal property of The Samaritans, Inc., a Rhode Island nonprofit §

501(c)(3) corporation located at 67 Park Place, Pawtucket, Rhode Island, to the extent the city

council of Pawtucket may from time to time determine;

(62) Real and personal property of North Kingstown, Exeter Animal Protection League,

Inc., dba "Pet Refuge," 500 Stony Lane, a Rhode Island nonprofit corporation, located in North

Kingstown, Rhode Island;

(63) Real and personal property located within the city of East Providence of Foster

Forward (formerly the Rhode Island Foster Parents Association), a Rhode Island charitable

nonprofit corporation;

(64) Real and personal property located at 54 Kelly Avenue within the town of East

Providence, of the Associated Radio Amateurs of Southern New England, a Rhode Island nonprofit

corporation;

(65) Real and tangible personal property of Providence Country Day School, a Rhode

Island nonprofit corporation, located in East Providence, Rhode Island and further identified as plat

406, block 6, lot 6, and plat 506, block 1, lot 8;

(66) As an effort to promote business growth, tangible business or personal property, in

whole or in part, within the town of Bristol's community limits, subject to authorization by formal

action of the town council of the town of Bristol;

(67) Real and tangible personal property of the Heritage Harbor Foundation, a Rhode

Island nonprofit corporation, located at 1445 Wampanoag Trail, Suites 103 and 201, within the city

of East Providence;

(68) Real property of Ocean State Community Wellness, Inc., a qualified tax-exempt

corporation under § 501(c)(3) of the United States Internal Revenue Code, located in North

Kingstown, Rhode Island, with a physical address of 7450 Post Road, and further identified as plat

108, lot 83;

(69) Real and tangible personal property of St. John Baptist De La Salle Institute, d/b/a La

Salle Academy, a Rhode Island domestic nonprofit corporation, located in Providence, Rhode

Island denominated at the time this subsection was adopted as Plat 83 Lot 276 by the tax assessor

for the city of Providence comprising approximately 26.08 acres of land along with all buildings

and improvements that have been or may be made;

(70) Real and tangible personal property of The Providence Community Health Centers,

Inc., a Rhode Island domestic nonprofit corporation, located in Providence, Rhode Island; and

(71) In the city of Central Falls and the city of Pawtucket, real property and tangible

personal property located on or in the premise acquired or leased by a railroad entity and for the

purpose of providing boarding and disembarking of railroad passengers and the supporting

passenger railroad operations and services. For the purpose of this section, a railroad entity shall be

any incorporated entity that has been duly authorized by the Rhode Island public utilities

commission to provide passenger railroad services.

(b) Except as provided below, when a city or town taxes a for-profit hospital facility, the

value of its real property shall be the value determined by the most recent full revaluation or

statistical property update performed by the city or town; provided, however, in the year a nonprofit

hospital facility converts to or otherwise becomes a for-profit hospital facility, or a for-profit

hospital facility is initially established, the value of the real property and personal property of the

for-profit hospital facility shall be determined by a valuation performed by the assessor for the

purpose of determining an initial assessed value of real and personal property, not previously taxed

by the city or town, as of the most recent date of assessment pursuant to § 44-5-1, subject to a right

of appeal by the for-profit hospital facility which shall be made to the city or town tax assessor with

a direct appeal from an adverse decision to the Rhode Island superior court business calendar.

A "for-profit hospital facility" includes all real and personal property affiliated with any

hospital as identified in an application filed pursuant to chapter 17 or 17.14 of title 23.

Notwithstanding the above, a city or town may enter into a stabilization agreement with a for-profit

hospital facility under § 44-3-9 or other laws specific to the particular city or town relating to

stabilization agreements. In a year in which a nonprofit hospital facility converts to, or otherwise

becomes, a for-profit hospital facility, or a for-profit hospital facility is otherwise established, in

that year only the amount levied by the city or town and/or the amount payable under the

stabilization agreement for that year related to the for-profit hospital facility shall not be counted

towards determining the maximum tax levy permitted under § 44-5-2.

for businesses, including small businesses, and to promote economic development, a city, town, or

fire district may establish an exemption for tangible personal property within its geographic limits

by formal action of the appropriate governing body within the city, town, or fire district, which

exemptions shall be uniformly applied and in compliance with local tax classification requirements.

Exemptions established pursuant to this subsection shall conform to the requirements of § 44-5-

12.2.

SECTION 7. Chapter 44-5 of the General Laws entitled " Levy and Assessment of Local

Taxes" is hereby amended by adding thereto the following sections:

44-5-11.16 44-5-11.17. Division of Municipal Finance Classification Exemption

Authority municipal finance classification exemption authority.

Notwithstanding any other provision of law to the contrary, the Division division of

Municipal Finance municipal finance (Division division) within the Department department of

Revenue revenue shall have the authority to grant a one-year exemption to any city or town

authorized to have a property tax classification structure under this chapter, where in the absence

of such an exemption, the city or town would not be in compliance with its applicable tax

classification structure. Any city or town seeking such an exemption shall provide the Division

division with any documentation that the Division division deems necessary to grant an exemption.

Such exemption, if approved by the Division division, shall be limited to one year. The city or

town, if granted such an exemption, shall be required to either have applicable state legislation

approved amending the specific section of law for which the exemption was sought or adjust its

class tax rates so that the city or town is in compliance for its next fiscal year.

44-5-12.2. Tangible personal property exemption -- Tax rate cap.

Notwithstanding any other provision of law to the contrary, the tax rate for the class of

property that includes tangible personal property for any city, town, or fire district that also

establishes a tangible personal property assessment exemption, pursuant to subsections (a)(51),

(a)(66), or (c) of § 44-3-3, § 44-3-47, § 44-3-65, or any other provision of law that enables a city,

town, or fire district to establish a tangible personal property assessment exemption, shall be capped

at the tax rate in effect for the assessment date immediately preceding the assessment date on which

the exemption takes effect or the assessment date immediately following the effective date of this

section, whichever is later.

SECTION 8. Section 44-18-30 of the General Laws in Chapter 44-18 entitled "Sales and

Use Taxes - Liability and Computation" is hereby amended to read as follows:

44-18-30. Gross receipts exempt from sales and use taxes.

There are exempted from the taxes imposed by this chapter the following gross receipts:

(1) Sales and uses beyond constitutional power of state. From the sale and from the storage,

use, or other consumption in this state of tangible personal property the gross receipts from the sale

of which, or the storage, use, or other consumption of which, this state is prohibited from taxing

under the Constitution of the United States or under the constitution of this state.

(2) Newspapers.

(i) From the sale and from the storage, use, or other consumption in this state of any

newspaper.

(ii) "Newspaper" means an unbound publication printed on newsprint that contains news,

editorial comment, opinions, features, advertising matter, and other matters of public interest.

(iii) "Newspaper" does not include a magazine, handbill, circular, flyer, sales catalog, or

similar item unless the item is printed for, and distributed as, a part of a newspaper.

(3) School meals. From the sale and from the storage, use, or other consumption in this

state of meals served by public, private, or parochial schools, school districts, colleges, universities,

student organizations, and parent-teacher associations to the students or teachers of a school,

college, or university whether the meals are served by the educational institutions or by a food

service or management entity under contract to the educational institutions.

(4) Containers.

(i) From the sale and from the storage, use, or other consumption in this state of:

(A) Non-returnable containers, including boxes, paper bags, and wrapping materials that

are biodegradable and all bags and wrapping materials utilized in the medical and healing arts,

when sold without the contents to persons who place the contents in the container and sell the

contents with the container.

(B) Containers when sold with the contents if the sale price of the contents is not required

to be included in the measure of the taxes imposed by this chapter.

the contents or when resold for refilling.

(D) Keg and barrel containers, whether returnable or not, when sold to alcoholic beverage

producers who place the alcoholic beverages in the containers.

(ii) As used in this subdivision, the term "returnable containers" means containers of a kind

customarily returned by the buyer of the contents for reuse. All other containers are "non-returnable

containers."

(5)(i) Charitable, educational, and religious organizations. From the sale to, as in defined

in this section, and from the storage, use, and other consumption in this state, or any other state of

the United States of America, of tangible personal property by hospitals not operated for a profit;

"educational institutions" as defined in subdivision (18) not operated for a profit; churches,

orphanages, and other institutions or organizations operated exclusively for religious or charitable

purposes; interest-free loan associations not operated for profit; nonprofit, organized sporting

leagues and associations and bands for boys and girls under the age of nineteen (19) years; the

following vocational student organizations that are state chapters of national vocational student

organizations: Distributive Education Clubs of America (DECA); Future Business Leaders of

America, Phi Beta Lambda (FBLA/PBL); Future Farmers of America (FFA); Future Homemakers

of America/Home Economics Related Occupations (FHA/HERD); Vocational Industrial Clubs of

America (VICA); organized nonprofit golden age and senior citizens clubs for men and women;

and parent-teacher associations; and from the sale, storage, use, and other consumption in this state,

of and by the Industrial Foundation of Burrillville, a Rhode Island domestic nonprofit corporation.

(ii) In the case of contracts entered into with the federal government, its agencies, or

instrumentalities, this state, or any other state of the United States of America, its agencies, any

city, town, district, or other political subdivision of the states; hospitals not operated for profit;

educational institutions not operated for profit; churches, orphanages, and other institutions or

organizations operated exclusively for religious or charitable purposes, the contractor may purchase

such materials and supplies (materials and/or supplies are defined as those that are essential to the

project) that are to be utilized in the construction of the projects being performed under the contracts

without payment of the tax.

(iii) The contractor shall not charge any sales or use tax to any exempt agency, institution,

or organization but shall in that instance provide his or her suppliers with certificates in the form

as determined by the division of taxation showing the reason for exemption and the contractor's

records must substantiate the claim for exemption by showing the disposition of all property so

purchased. If any property is then used for a nonexempt purpose, the contractor must pay the tax

on the property used.

(6) Gasoline. From the sale and from the storage, use, or other consumption in this state of:

(i) Gasoline and other products taxed under chapter 36 of title 31 and (ii) Fuels used for the

propulsion of airplanes.

(7) Purchase for manufacturing purposes.

(i) From the sale and from the storage, use, or other consumption in this state of computer

software, tangible personal property, electricity, natural gas, artificial gas, steam, refrigeration, and

water, when the property or service is purchased for the purpose of being manufactured into a

finished product for resale and becomes an ingredient, component, or integral part of the

manufactured, compounded, processed, assembled, or prepared product, or if the property or

service is consumed in the process of manufacturing for resale computer software, tangible personal

property, electricity, natural gas, artificial gas, steam, refrigeration, or water.

(ii) "Consumed" means destroyed, used up, or worn out to the degree or extent that the

property cannot be repaired, reconditioned, or rendered fit for further manufacturing use.

(iii) "Consumed" includes mere obsolescence.

(iv) "Manufacturing" means and includes: manufacturing, compounding, processing,

assembling, preparing, or producing.

(v) "Process of manufacturing" means and includes all production operations performed in

the producing or processing room, shop, or plant, insofar as the operations are a part of and

connected with the manufacturing for resale of tangible personal property, electricity, natural gas,

artificial gas, steam, refrigeration, or water and all production operations performed insofar as the

operations are a part of and connected with the manufacturing for resale of computer software.

(vi) "Process of manufacturing" does not mean or include administration operations such

as general office operations, accounting, collection, or sales promotion, nor does it mean or include

distribution operations that occur subsequent to production operations, such as handling, storing,

selling, and transporting the manufactured products, even though the administration and

distribution operations are performed by, or in connection with, a manufacturing business.

(8) State and political subdivisions. From the sale to, and from the storage, use, or other

consumption by, this state, any city, town, district, or other political subdivision of this state. Every

redevelopment agency created pursuant to chapter 31 of title 45 is deemed to be a subdivision of

the municipality where it is located.

(9) Food and food ingredients. From the sale and storage, use, or other consumption in this

state of food and food ingredients as defined in § 44-18-7.1(l).

For the purposes of this exemption "food and food ingredients" shall not include candy,

soft drinks, dietary supplements, alcoholic beverages, tobacco, food sold through vending

machines, or prepared food, as those terms are defined in § 44-18-7.1, unless the prepared food is:

(i) Sold by a seller whose primary NAICS classification is manufacturing in sector 311,

except sub-sector 3118 (bakeries);

(ii) Sold in an unheated state by weight or volume as a single item;

(iii) Bakery items, including: bread, rolls, buns, biscuits, bagels, croissants, pastries,

donuts, danish, cakes, tortes, pies, tarts, muffins, bars, cookies, tortillas; and

is not sold with utensils provided by the seller, including: plates, knives, forks, spoons,

glasses, cups, napkins, or straws.

(10) Medicines, drugs, and durable medical equipment. From the sale and from the storage,

use, or other consumption in this state, of:

(i) "Drugs" as defined in § 44-18-7.1(h)(i), sold on prescriptions, medical oxygen, and

insulin whether or not sold on prescription. For purposes of this exemption drugs shall not include

over-the-counter drugs and grooming and hygiene products as defined in § 44-18-7.1(h)(iii).

(ii) Durable medical equipment as defined in § 44-18-7.1(k) for home use only, including,

but not limited to: syringe infusers, ambulatory drug delivery pumps, hospital beds, convalescent

chairs, and chair lifts. Supplies used in connection with syringe infusers and ambulatory drug

delivery pumps that are sold on prescription to individuals to be used by them to dispense or

administer prescription drugs, and related ancillary dressings and supplies used to dispense or

administer prescription drugs, shall also be exempt from tax.

(11) Prosthetic devices and mobility enhancing equipment. From the sale and from the

storage, use, or other consumption in this state, of prosthetic devices as defined in § 44-18-7.1(t),

sold on prescription, including, but not limited to: artificial limbs, dentures, spectacles, eyeglasses,

and artificial eyes; artificial hearing devices and hearing aids, whether or not sold on prescription;

and mobility enhancing equipment as defined in § 44-18-7.1(p), including wheelchairs, crutches,

and canes.

(12) Coffins, caskets, urns, shrouds and burial garments. From the sale and from the

storage, use, or other consumption in this state of coffins, caskets, burial containers, urns, urn liners,

urn vaults, grave liners, grave vaults, burial tent setups, prayer cards, shrouds, and other burial

garments that are ordinarily sold by a funeral director as part of the business of funeral directing.

(13) Motor vehicles sold to nonresidents.

(i) From the sale, subsequent to June 30, 1958, of a motor vehicle to a bona fide nonresident

of this state who does not register the motor vehicle in this state, whether the sale or delivery of the

motor vehicle is made in this state or at the place of residence of the nonresident. A motor vehicle

sold to a bona fide nonresident whose state of residence does not allow a like exemption to its

nonresidents is not exempt from the tax imposed under § 44-18-20. In that event, the bona fide

nonresident pays a tax to Rhode Island on the sale at a rate equal to the rate that would be imposed

in his or her state of residence not to exceed the rate that would have been imposed under § 44-18-

20. Notwithstanding any other provisions of law, a licensed motor vehicle dealer shall add and

collect the tax required under this subdivision and remit the tax to the tax administrator under the

provisions of chapters 18 and 19 of this title. When a Rhode Island licensed, motor vehicle dealer

is required to add and collect the sales and use tax on the sale of a motor vehicle to a bona fide

nonresident as provided in this section, the dealer in computing the tax takes into consideration the

law of the state of the nonresident as it relates to the trade-in of motor vehicles.

(ii) The tax administrator, in addition to the provisions of §§ 44-19-27 and 44-19-28, may

require any licensed motor vehicle dealer to keep records of sales to bona fide nonresidents as the

tax administrator deems reasonably necessary to substantiate the exemption provided in this

subdivision, including the affidavit of a licensed motor vehicle dealer that the purchaser of the

motor vehicle was the holder of, and had in his or her possession a valid out-of-state motor vehicle

registration or a valid out-of-state driver's license.

(iii) Any nonresident who registers a motor vehicle in this state within ninety (90) days of

the date of its sale to him or her is deemed to have purchased the motor vehicle for use, storage, or

other consumption in this state, and is subject to, and liable for, the use tax imposed under the

provisions of § 44-18-20.

(14) Sales in public buildings by blind people. From the sale and from the storage, use, or

other consumption in all public buildings in this state of all products or wares by any person

licensed under § 40-9-11.1.

(15) Air and water pollution control facilities. From the sale, storage, use, or other

consumption in this state of tangible personal property or supplies acquired for incorporation into

or used and consumed in the operation of a facility, the primary purpose of which is to aid in the

control of the pollution or contamination of the waters or air of the state, as defined in chapter 12

of title 46 and chapter 23 of title 23, respectively, and that has been certified as approved for that

purpose by the director of environmental management. The director of environmental management

may certify to a portion of the tangible personal property or supplies acquired for incorporation

into those facilities or used and consumed in the operation of those facilities to the extent that that

portion has as its primary purpose the control of the pollution or contamination of the waters or air

of this state. As used in this subdivision, "facility" means any land, facility, device, building,

machinery, or equipment.

(16) Camps. From the rental charged for living quarters, or sleeping, or housekeeping

accommodations at camps or retreat houses operated by religious, charitable, educational, or other

organizations and associations mentioned in subsection (5), or by privately owned and operated

summer camps for children.

(17) Certain institutions. From the rental charged for living or sleeping quarters in an

institution licensed by the state for the hospitalization, custodial, or nursing care of human beings.

(18) Educational institutions. From the rental charged by any educational institution for

living quarters, or sleeping, or housekeeping accommodations or other rooms or accommodations

to any student or teacher necessitated by attendance at an educational institution. "Educational

institution" as used in this section means an institution of learning not operated for profit that is

empowered to confer diplomas, educational, literary, or academic degrees; that has a regular

faculty, curriculum, and organized body of pupils or students in attendance throughout the usual

school year; that keeps and furnishes to students and others records required and accepted for

entrance to schools of secondary, collegiate, or graduate rank; and no part of the net earnings of

which inures to the benefit of any individual.

(19) Motor vehicle and adaptive equipment for persons with disabilities.

(i) From the sale of: (A) Special adaptations; (B) The component parts of the special

adaptations; or (C) A specially adapted motor vehicle; provided that the owner furnishes to the tax

administrator an affidavit of a licensed physician to the effect that the specially adapted motor

vehicle is necessary to transport a family member with a disability or where the vehicle has been

specially adapted to meet the specific needs of the person with a disability. This exemption applies

to not more than one motor vehicle owned and registered for personal, noncommercial use.

(ii) For the purpose of this subsection the term "special adaptations" includes, but is not

limited to: wheelchair lifts, wheelchair carriers, wheelchair ramps, wheelchair securements, hand

controls, steering devices, extensions, relocations, and crossovers of operator controls, power-

assisted controls, raised tops or dropped floors, raised entry doors, or alternative signaling devices

to auditory signals.

(iii) From the sale of: (a) Special adaptations, (b) The component parts of the special

adaptations, for a "wheelchair accessible taxicab" as defined in § 39-14-1, and/or a "wheelchair

accessible public motor vehicle" as defined in § 39-14.1-1.

(iv) For the purpose of this subdivision the exemption for a "specially adapted motor

vehicle" means a use tax credit not to exceed the amount of use tax that would otherwise be due on

the motor vehicle, exclusive of any adaptations. The use tax credit is equal to the cost of the special

adaptations, including installation.

(20) Heating fuels. From the sale and from the storage, use, or other consumption in this

state of every type of heating fuel.

(21) Electricity and gas. From the sale and from the storage, use, or other consumption in

this state of electricity and gas.

(22) Manufacturing machinery and equipment.

(i) From the sale and from the storage, use, or other consumption in this state of tools, dies,

molds, machinery, equipment (including replacement parts), and related items to the extent used in

an industrial plant in connection with the actual manufacture, conversion, or processing of tangible

personal property, or to the extent used in connection with the actual manufacture, conversion, or

processing of computer software as that term is utilized in industry numbers 7371, 7372, and 7373

in the standard industrial classification manual prepared by the Technical Committee on Industrial

Classification, Office of Statistical Standards, Executive Office of the President, United States

Bureau of the Budget, as revised from time to time, to be sold, or that machinery and equipment

used in the furnishing of power to an industrial manufacturing plant. For the purposes of this

subdivision, "industrial plant" means a factory at a fixed location primarily engaged in the

manufacture, conversion, or processing of tangible personal property to be sold in the regular

course of business;

(ii) Machinery and equipment and related items are not deemed to be used in connection

with the actual manufacture, conversion, or processing of tangible personal property, or in

connection with the actual manufacture, conversion, or processing of computer software as that

term is utilized in industry numbers 7371, 7372, and 7373 in the standard industrial classification

manual prepared by the Technical Committee on Industrial Classification, Office of Statistical

Standards, Executive Office of the President, United States Bureau of the Budget, as revised from

time to time, to be sold to the extent the property is used in administration or distribution operations;

(iii) Machinery and equipment and related items used in connection with the actual

manufacture, conversion, or processing of any computer software or any tangible personal property

that is not to be sold and that would be exempt under subdivision (7) or this subdivision if purchased

from a vendor or machinery and equipment and related items used during any manufacturing,

converting, or processing function is exempt under this subdivision even if that operation, function,

or purpose is not an integral or essential part of a continuous production flow or manufacturing

process;

(iv) Where a portion of a group of portable or mobile machinery is used in connection with

the actual manufacture, conversion, or processing of computer software or tangible personal

property to be sold, as previously defined, that portion, if otherwise qualifying, is exempt under

this subdivision even though the machinery in that group is used interchangeably and not otherwise

identifiable as to use.

(23) Trade-in value of motor vehicles. From the sale and from the storage, use, or other

consumption in this state of so much of the purchase price paid for a new or used automobile as is

allocated for a trade-in allowance on the automobile of the buyer given in trade to the seller, or of

the proceeds applicable only to the automobile as are received from the manufacturer of

automobiles for the repurchase of the automobile whether the repurchase was voluntary or not

towards the purchase of a new or used automobile by the buyer. For the purpose of this subdivision,

the word "automobile" means a private passenger automobile not used for hire and does not refer

to any other type of motor vehicle.

(24) Precious metal bullion.

(i) From the sale and from the storage, use, or other consumption in this state of precious

metal bullion, substantially equivalent to a transaction in securities or commodities.

(ii) For purposes of this subdivision, "precious metal bullion" means any elementary

precious metal that has been put through a process of smelting or refining, including, but not limited

to: gold, silver, platinum, rhodium, and chromium, and that is in a state or condition that its value

depends upon its content and not upon its form.

(iii) The term does not include fabricated precious metal that has been processed or

manufactured for some one or more specific and customary industrial, professional, or artistic uses.

(25) Commercial vessels. From sales made to a commercial ship, barge, or other vessel of

fifty (50) tons burden or over, primarily engaged in interstate or foreign commerce, and from the

repair, alteration, or conversion of the vessels, and from the sale of property purchased for the use

of the vessels including provisions, supplies, and material for the maintenance and/or repair of the

vessels.

(26) Commercial fishing vessels. From the sale and from the storage, use, or other

consumption in this state of vessels and other watercraft that are in excess of five (5) net tons and

that are used exclusively for "commercial fishing," as defined in this subdivision, and from the

repair, alteration, or conversion of those vessels and other watercraft, and from the sale of property

purchased for the use of those vessels and other watercraft including provisions, supplies, and

material for the maintenance and/or repair of the vessels and other watercraft and the boats nets,

cables, tackle, and other fishing equipment appurtenant to or used in connection with the

commercial fishing of the vessels and other watercraft. "Commercial fishing" means taking or

attempting to take any fish, shellfish, crustacea, or bait species with the intent of disposing of it for

profit or by sale, barter, trade, or in commercial channels. The term does not include subsistence

fishing, i.e., the taking for personal use and not for sale or barter; or sport fishing; but shall include

vessels and other watercraft with a Rhode Island party and charter boat license issued by the

department of environmental management pursuant to § 20-2-27.1 that meet the following criteria:

(i) The operator must have a current United States Coast Guard (U.S.C.G.) license to carry

passengers for hire; (ii) U.S.C.G. vessel documentation in the coast wide fishery trade; (iii)

U.S.C.G. vessel documentation as to proof of Rhode Island home port status or a Rhode Island boat

registration to prove Rhode Island home port status; and (iv) The vessel must be used as a

commercial passenger carrying fishing vessel to carry passengers for fishing. The vessel must be

able to demonstrate that at least fifty percent (50%) of its annual gross income derives from charters

or provides documentation of a minimum of one hundred (100) charter trips annually; and (v) The

vessel must have a valid Rhode Island party and charter boat license. The tax administrator shall

implement the provisions of this subdivision by promulgating rules and regulations relating thereto.

(27) Clothing and footwear. From the sales of articles of clothing, including footwear,

intended to be worn or carried on or about the human body for sales prior to October 1, 2012.

Effective October 1, 2012, the exemption will apply to the sales of articles of clothing, including

footwear, intended to be worn or carried on or about the human body up to two hundred and fifty

dollars ($250) of the sales price per item. For the purposes of this section, "clothing or footwear"

does not include clothing accessories or equipment or special clothing or footwear primarily

designed for athletic activity or protective use as these terms are defined in section 44-18-7.1(f). In

recognition of the work being performed by the streamlined sales and use tax governing board,

upon passage of any federal law that authorizes states to require remote sellers to collect and remit

sales and use taxes, this unlimited exemption will apply as it did prior to October 1, 2012. The

unlimited exemption on sales of clothing and footwear shall take effect on the date that the state

requires remote sellers to collect and remit sales and use taxes.

(28) Water for residential use. From the sale and from the storage, use, or other

consumption in this state of water furnished for domestic use by occupants of residential premises.

(29) Bibles. [Unconstitutional; see Ahlburn v. Clark, 728 A.2d 449 (R.I. 1999); see Notes

to Decisions.] From the sale and from the storage, use, or other consumption in the state of any

canonized scriptures of any tax-exempt nonprofit religious organization including, but not limited

to, the Old Testament and the New Testament versions.

(30) Boats.

(i) From the sale of a boat or vessel to a bona fide nonresident of this state who does not

government at a home port within the state, whether the sale or delivery of the boat or vessel is

made in this state or elsewhere; provided, that the nonresident transports the boat within thirty (30)

days after delivery by the seller outside the state for use thereafter solely outside the state.

(ii) The tax administrator, in addition to the provisions of §§ 44-19-27 and 44-19-28, may

require the seller of the boat or vessel to keep records of the sales to bona fide nonresidents as the

tax administrator deems reasonably necessary to substantiate the exemption provided in this

subdivision, including the affidavit of the seller that the buyer represented himself or herself to be

a bona fide nonresident of this state and of the buyer that he or she is a nonresident of this state.

(31) Youth activities equipment. From the sale, storage, use, or other consumption in this

state of items for not more than twenty dollars ($20.00) each by nonprofit Rhode Island

eleemosynary organizations, for the purposes of youth activities that the organization is formed to

sponsor and support; and by accredited elementary and secondary schools for the purposes of the

schools or of organized activities of the enrolled students.

(32) Farm equipment. From the sale and from the storage or use of machinery and

equipment used directly for commercial farming and agricultural production; including, but not

limited to: tractors, ploughs, harrows, spreaders, seeders, milking machines, silage conveyors,

balers, bulk milk storage tanks, trucks with farm plates, mowers, combines, irrigation equipment,

greenhouses and greenhouse coverings, graders and packaging machines, tools and supplies and

other farming equipment, including replacement parts appurtenant to or used in connection with

commercial farming and tools and supplies used in the repair and maintenance of farming

equipment. "Commercial farming" means the keeping or boarding of five (5) or more horses or the

production within this state of agricultural products, including, but not limited to, field or orchard

crops, livestock, dairy, and poultry, or their products, where the keeping, boarding, or production

provides at least two thousand five hundred dollars ($2,500) in annual gross sales to the operator,

whether an individual, a group, a partnership, or a corporation for exemptions issued prior to July

1, 2002. For exemptions issued or renewed after July 1, 2002, there shall be two (2) levels. Level I

shall be based on proof of annual, gross sales from commercial farming of at least twenty-five

hundred dollars ($2,500) and shall be valid for purchases subject to the exemption provided in this

subdivision except for motor vehicles with an excise tax value of five thousand dollars ($5,000) or

greater. Level II shall be based on proof of annual gross sales from commercial farming of at least

ten thousand dollars ($10,000) or greater and shall be valid for purchases subject to the exemption

provided in this subdivision including motor vehicles with an excise tax value of five thousand

dollars ($5,000) or greater. For the initial issuance of the exemptions, proof of the requisite amount

of annual gross sales from commercial farming shall be required for the prior year; for any renewal

of an exemption granted in accordance with this subdivision at either level I or level II, proof of

gross annual sales from commercial farming at the requisite amount shall be required for each of

the prior two (2) years. Certificates of exemption issued or renewed after July 1, 2002, shall clearly

indicate the level of the exemption and be valid for four (4) years after the date of issue. This

exemption applies even if the same equipment is used for ancillary uses, or is temporarily used for

a non-farming or a non-agricultural purpose, but shall not apply to motor vehicles acquired after

July 1, 2002, unless the vehicle is a farm vehicle as defined pursuant to § 31-1-8 and is eligible for

registration displaying farm plates as provided for in § 31-3-31.

(33) Compressed air. From the sale and from the storage, use, or other consumption in the

state of compressed air.

(34) Flags. From the sale and from the storage, consumption, or other use in this state of

United States, Rhode Island or POW-MIA flags.

(35) Motor vehicle and adaptive equipment to certain veterans. From the sale of a motor

vehicle and adaptive equipment to and for the use of a veteran with a service-connected loss of or

the loss of use of a leg, foot, hand, or arm, or any veteran who is a double amputee, whether service

connected or not. The motor vehicle must be purchased by and especially equipped for use by the

qualifying veteran. Certificate of exemption or refunds of taxes paid is granted under rules or

regulations that the tax administrator may prescribe.

(36) Textbooks. From the sale and from the storage, use, or other consumption in this state

of textbooks by an "educational institution," as defined in subsection (18) of this section, and any

educational institution within the purview of § 16-63-9(4), and used textbooks by any purveyor.

(37) Tangible personal property and supplies used in on-site hazardous waste recycling,

reuse, or treatment. From the sale, storage, use, or other consumption in this state of tangible

personal property or supplies used or consumed in the operation of equipment, the exclusive

function of which is the recycling, reuse, or recovery of materials (other than precious metals, as

defined in subdivision (24)(ii) of this section) from the treatment of "hazardous wastes," as defined

in § 23-19.1-4, where the "hazardous wastes" are generated in Rhode Island solely by the same

taxpayer and where the personal property is located at, in, or adjacent to a generating facility of the

taxpayer in Rhode Island. The taxpayer shall procure an order from the director of the department

of environmental management certifying that the equipment and/or supplies as used or consumed,

qualify for the exemption under this subdivision. If any information relating to secret processes or

methods of manufacture, production, or treatment is disclosed to the department of environmental

management only to procure an order, and is a "trade secret" as defined in § 28-21-10(b), it is not

open to public inspection or publicly disclosed unless disclosure is required under chapter 21 of

title 28 or chapter 24.4 of title 23.

(38) Promotional and product literature of boat manufacturers. From the sale and from the

storage, use, or other consumption of promotional and product literature of boat manufacturers

shipped to points outside of Rhode Island that either: (i) Accompany the product that is sold; (ii)

Are shipped in bulk to out-of-state dealers for use in the sale of the product; or (iii) Are mailed to

customers at no charge.

(39) Food items paid for by food stamps. From the sale and from the storage, use, or other

consumption in this state of eligible food items payment for which is properly made to the retailer

in the form of U.S. government food stamps issued in accordance with the Food Stamp Act of 1977,

7 U.S.C. § 2011 et seq.

(40) Transportation charges. From the sale or hiring of motor carriers as defined in § 39-

12-2(12) to haul goods, when the contract or hiring cost is charged by a motor freight tariff filed

with the Rhode Island public utilities commission on the number of miles driven or by the number

of hours spent on the job.

(41) Trade-in value of boats. From the sale and from the storage, use, or other consumption

in this state of so much of the purchase price paid for a new or used boat as is allocated for a trade-

in allowance on the boat of the buyer given in trade to the seller or of the proceeds applicable only

to the boat as are received from an insurance claim as a result of a stolen or damaged boat, towards

the purchase of a new or used boat by the buyer.

(42) Equipment used for research and development. From the sale and from the storage,

use, or other consumption of equipment to the extent used for research and development purposes

by a qualifying firm. For the purposes of this subsection, "qualifying firm" means a business for

which the use of research and development equipment is an integral part of its operation and

"equipment" means scientific equipment, computers, software, and related items.

(43) Coins. From the sale and from the other consumption in this state of coins having

numismatic or investment value.

(44) Farm structure construction materials. Lumber, hardware, and other materials used in

the new construction of farm structures, including production facilities such as, but not limited to:

farrowing sheds, free stall and stanchion barns, milking parlors, silos, poultry barns, laying houses,

fruit and vegetable storages, rooting cellars, propagation rooms, greenhouses, packing rooms,

machinery storage, seasonal farm worker housing, certified farm markets, bunker and trench silos,

feed storage sheds, and any other structures used in connection with commercial farming.

(45) Telecommunications carrier access service. Carrier access service or

telecommunications service when purchased by a telecommunications company from another

telecommunications company to facilitate the provision of telecommunications service.

(46) Boats or vessels brought into the state exclusively for winter storage, maintenance,

repair, or sale. Notwithstanding the provisions of §§ 44-18-10, 44-18-11 and 44-18-20, the tax

imposed by § 44-18-20 is not applicable for the period commencing on the first day of October in

any year up to and including the 30th day of April next succeeding with respect to the use of any

boat or vessel within this state exclusively for purposes of: (i) Delivery of the vessel to a facility in

this state for storage, including dry storage and storage in water by means of apparatus preventing

ice damage to the hull, maintenance, or repair; (ii) The actual process of storage, maintenance, or

repair of the boat or vessel; or (iii) Storage for the purpose of selling the boat or vessel.

(47) Jewelry display product. From the sale and from the storage, use, or other consumption

in this state of tangible personal property used to display any jewelry product; provided that title to

the jewelry display product is transferred by the jewelry manufacturer or seller and that the jewelry

display product is shipped out of state for use solely outside the state and is not returned to the

jewelry manufacturer or seller.

(48) Boats or vessels generally. Notwithstanding the provisions of this chapter, the tax

imposed by §§ 44-18-20 and 44-18-18 shall not apply with respect to the sale and to the storage,

use, or other consumption in this state of any new or used boat. The exemption provided for in this

subdivision does not apply after October 1, 1993, unless prior to October 1, 1993, the federal ten

percent (10%) surcharge on luxury boats is repealed.

(49) Banks and regulated investment companies interstate toll-free calls. Notwithstanding

the provisions of this chapter, the tax imposed by this chapter does not apply to the furnishing of

interstate and international, toll-free terminating telecommunication service that is used directly

and exclusively by or for the benefit of an eligible company as defined in this subdivision; provided

that an eligible company employs on average during the calendar year no less than five hundred

(500) "full-time equivalent employees" as that term is defined in § 42-64.5-2. For purposes of this

section, an "eligible company" means a "regulated investment company" as that term is defined in

the Internal Revenue Code of 1986, 26 U.S.C. § 851, or a corporation to the extent the service is

provided, directly or indirectly, to or on behalf of a regulated investment company, an employee

benefit plan, a retirement plan or a pension plan, or a state-chartered bank.

(50) Mobile and manufactured homes generally. From the sale and from the storage, use,

or other consumption in this state of mobile and/or manufactured homes as defined and subject to

taxation pursuant to the provisions of chapter 44 of title 31.

(51) Manufacturing business reconstruction materials.

(i) From the sale and from the storage, use, or other consumption in this state of lumber,

hardware, and other building materials used in the reconstruction of a manufacturing business

facility that suffers a disaster, as defined in this subdivision, in this state. "Disaster" means any

occurrence, natural or otherwise, that results in the destruction of sixty percent (60%) or more of

an operating manufacturing business facility within this state. "Disaster" does not include any

damage resulting from the willful act of the owner of the manufacturing business facility.

(ii) Manufacturing business facility includes, but is not limited to, the structures housing

the production and administrative facilities.

(iii) In the event a manufacturer has more than one manufacturing site in this state, the sixty

percent (60%) provision applies to the damages suffered at that one site.

(iv) To the extent that the costs of the reconstruction materials are reimbursed by insurance,

this exemption does not apply.

(52) Tangible personal property and supplies used in the processing or preparation of floral

products and floral arrangements. From the sale, storage, use, or other consumption in this state of

tangible personal property or supplies purchased by florists, garden centers, or other like producers

or vendors of flowers, plants, floral products, and natural and artificial floral arrangements that are

ultimately sold with flowers, plants, floral products, and natural and artificial floral arrangements

or are otherwise used in the decoration, fabrication, creation, processing, or preparation of flowers,

plants, floral products, or natural and artificial floral arrangements, including descriptive labels,

stickers, and cards affixed to the flower, plant, floral product, or arrangement, artificial flowers,

spray materials, floral paint and tint, plant shine, flower food, insecticide, and fertilizers.

(53) Horse food products. From the sale and from the storage, use, or other consumption

in this state of horse food products purchased by a person engaged in the business of the boarding

of horses.

(54) Non-motorized recreational vehicles sold to nonresidents.

(i) From the sale, subsequent to June 30, 2003, of a non-motorized recreational vehicle to

a bona fide nonresident of this state who does not register the non-motorized recreational vehicle

in this state, whether the sale or delivery of the non-motorized recreational vehicle is made in this

state or at the place of residence of the nonresident; provided that a non-motorized recreational

vehicle sold to a bona fide nonresident whose state of residence does not allow a like exemption to

its nonresidents is not exempt from the tax imposed under § 44-18-20; provided, further, that in

that event the bona fide nonresident pays a tax to Rhode Island on the sale at a rate equal to the rate

that would be imposed in his or her state of residence not to exceed the rate that would have been

imposed under § 44-18-20. Notwithstanding any other provisions of law, a licensed, non-motorized

recreational vehicle dealer shall add and collect the tax required under this subdivision and remit

the tax to the tax administrator under the provisions of chapters 18 and 19 of this title. Provided,

that when a Rhode Island licensed, non-motorized recreational vehicle dealer is required to add and

collect the sales and use tax on the sale of a non-motorized recreational vehicle to a bona fide

nonresident as provided in this section, the dealer in computing the tax takes into consideration the

law of the state of the nonresident as it relates to the trade-in of motor vehicles.

(ii) The tax administrator, in addition to the provisions of §§ 44-19-27 and 44-19-28, may

require any licensed, non-motorized recreational vehicle dealer to keep records of sales to bona fide

nonresidents as the tax administrator deems reasonably necessary to substantiate the exemption

provided in this subdivision, including the affidavit of a licensed, non-motorized recreational

vehicle dealer that the purchaser of the non-motorized recreational vehicle was the holder of, and

had in his or her possession a valid out-of-state non-motorized recreational vehicle registration or

a valid out-of-state driver's license.

(iii) Any nonresident who registers a non-motorized recreational vehicle in this state within

ninety (90) days of the date of its sale to him or her is deemed to have purchased the non-motorized

recreational vehicle for use, storage, or other consumption in this state, and is subject to, and liable

for, the use tax imposed under the provisions of § 44-18-20.

(iv) "Non-motorized recreational vehicle" means any portable dwelling designed and

constructed to be used as a temporary dwelling for travel, camping, recreational, and vacation use

that is eligible to be registered for highway use, including, but not limited to, "pick-up coaches" or

"pick-up campers," "travel trailers," and "tent trailers" as those terms are defined in chapter 1 of

title 31.

(55) Sprinkler and fire alarm systems in existing buildings. From the sale in this state of

sprinkler and fire alarm systems; emergency lighting and alarm systems; and the materials

necessary and attendant to the installation of those systems that are required in buildings and

occupancies existing therein in July 2003 in order to comply with any additional requirements for

such buildings arising directly from the enactment of the Comprehensive Fire Safety Act of 2003

and that are not required by any other provision of law or ordinance or regulation adopted pursuant

to that act. The exemption provided in this subdivision shall expire on December 31, 2008.

(56) Aircraft. Notwithstanding the provisions of this chapter, the tax imposed by §§ 44-18-

18 and 44-18-20 shall not apply with respect to the sale and to the storage, use, or other consumption

in this state of any new or used aircraft or aircraft parts.

(57) Renewable energy products. Notwithstanding any other provisions of Rhode Island

general laws, the following products shall also be exempt from sales tax: solar photovoltaic

modules or panels, or any module or panel that generates electricity from light; solar thermal

collectors, including, but not limited to, those manufactured with flat glass plates, extruded plastic,

sheet metal, and/or evacuated tubes; geothermal heat pumps, including both water-to-water and

water-to-air type pumps; wind turbines; towers used to mount wind turbines if specified by or sold

by a wind turbine manufacturer; DC to AC inverters that interconnect with utility power lines; and

manufactured mounting racks and ballast pans for solar collector, module, or panel installation. Not

to include materials that could be fabricated into such racks; monitoring and control equipment, if

specified or supplied by a manufacturer of solar thermal, solar photovoltaic, geothermal, or wind

energy systems or if required by law or regulation for such systems but not to include pumps, fans

or plumbing or electrical fixtures unless shipped from the manufacturer affixed to, or an integral

part of, another item specified on this list; and solar storage tanks that are part of a solar domestic

hot water system or a solar space heating system. If the tank comes with an external heat exchanger

it shall also be tax exempt, but a standard hot water tank is not exempt from state sales tax.

(58) Returned property. The amount charged for property returned by customers upon

rescission of the contract of sale when the entire amount exclusive of handling charges paid for the

property is refunded in either cash or credit, and where the property is returned within one hundred

twenty (120) days from the date of delivery.

(59) Dietary supplements. From the sale and from the storage, use, or other consumption

of dietary supplements as defined in § 44-18-7.1(l)(v), sold on prescriptions.

(60) Blood. From the sale and from the storage, use, or other consumption of human blood.

(61) Agricultural products for human consumption. From the sale and from the storage,

use, or other consumption of livestock and poultry of the kinds of products that ordinarily constitute

food for human consumption and of livestock of the kind the products of which ordinarily constitute

fibers for human use.

(62) Diesel emission control technology. From the sale and use of diesel retrofit technology

that is required by § 31-47.3-4.

(63) Feed for certain animals used in commercial farming. From the sale of feed for animals

as described in subsection (61) of this section.

(64) Alcoholic beverages. From the sale and storage, use, or other consumption in this state

by a Class A licensee of alcoholic beverages, as defined in § 44-18-7.1, excluding beer and malt

beverages; provided, further, notwithstanding § 6-13-1 or any other general or public law to the

contrary, alcoholic beverages, as defined in § 44-18-7.1, shall not be subject to minimum markup.

(65) Seeds and plants used to grow food and food ingredients. From the sale, storage, use,

or other consumption in this state of seeds and plants used to grow food and food ingredients as

defined in § 44-18-7.1(l)(i). "Seeds and plants used to grow food and food ingredients" shall not

include marijuana seeds or plants.

(66) Feminine hygiene products. From the sale and from the storage, use, or other

consumption of tampons, panty liners, menstrual cups, sanitary napkins, and other similar products

the principal use of which is feminine hygiene in connection with the menstrual cycle.

(67) “Breast pump collection and storage supplies" means items of tangible personal

property used in conjunction with a breast pump to collect milk expressed from a human breast and

to store collected milk until it is ready for consumption. "Breast pump collection and storage

supplies" include, but are not limited to, breast shields and breast shield connectors; breast pump

tubes and tubing adapters adaptors; breast pump valves and membranes; backflow protectors and

backflow protector adaptors; bottles and bottle caps specific to the operation of the breast pump;

breast milk storage bags; and related items sold as part of a breast pump kit pre-packaged by the

breast pump manufacturer. "Breast pump collection and storage supplies" does not include: bottles

and bottle caps not specific to the operation of the breast pump; breast pump travel bags and other

similar carrying accessories, including ice packs, labels, and other similar products, unless sold as

part of a breast pump kit pre-packed by the breast pump manufacturer; breast pump cleaning

supplies, unless sold as part of a breast pump kit pre-packaged by the breast pump manufacturer;

nursing bras, bra pads, breast shells, and other similar products; and creams, ointments, and other

similar products that relieve breastfeeding-related symptoms or conditions of the breasts or nipples.

(68) Trade-in value of motorcycles. From the sale and from the storage, use, or other

consumption in this state of so much of the purchase price paid for a new or used motorcycle as is

allocated for a trade in allowance on the motorcycle of the buyer given in trade to the seller, or of

the proceeds applicable only to the motorcycle as are received from the manufacturer of

motorcycles for the repurchase of the motorcycle whether the repurchase was voluntary or not

towards the purchase of a new or used motorcycle by the buyer. For the purpose of this subsection,

the word "motorcycle" means a motorcycle not used for hire and does not refer to any other type

of motor vehicle.

SECTION 9. Section 44-30-12 of the General Laws in Chapter 44-30 entitled "Personal

Income Tax" is hereby amended to read as follows:

44-30-12 Rhode Island income of a resident individual.

(a) General. The Rhode Island income of a resident individual means his or her adjusted

gross income for federal income tax purposes, with the modifications specified in this section.

(b) Modifications increasing federal adjusted gross income. There shall be added to federal

adjusted gross income:

(1) Interest income on obligations of any state, or its political subdivisions, other than

Rhode Island or its political subdivisions;

(2) Interest or dividend income on obligations or securities of any authority, commission,

or instrumentality of the United States, but not of Rhode Island or its political subdivisions, to the

extent exempted by the laws of the United States from federal income tax but not from state income

taxes;

(3) The modification described in § 44-30-25(g);

(4) (i) The amount defined below of a nonqualified withdrawal made from an account in

the tuition savings program pursuant to § 16-57-6.1. For purposes of this section, a nonqualified

withdrawal is:

(A) A transfer or rollover to a qualified tuition program under Section 529 of the Internal

Revenue Code, 26 U.S.C. § 529, other than to the tuition savings program referred to in § 16-57-

6.1; and

(B) A withdrawal or distribution that is:

(I) Not applied on a timely basis to pay "qualified higher education expenses" as defined

in § 16-57-3(12) of the beneficiary of the account from which the withdrawal is made;

(II) Not made for a reason referred to in § 16-57-6.1(e); or

(III) Not made in other circumstances for which an exclusion from tax made applicable by

Section 529 of the Internal Revenue Code, 26 U.S.C. § 529, pertains if the transfer, rollover,

withdrawal, or distribution is made within two (2) taxable years following the taxable year for

which a contributions modification pursuant to subsection (c)(4) of this section is taken based on

contributions to any tuition savings program account by the person who is the participant of the

account at the time of the contribution, whether or not the person is the participant of the account

at the time of the transfer, rollover, withdrawal or distribution;

(ii) In the event of a nonqualified withdrawal under subsection (b)(4)(i)(A) or (b)(4)(i)(B)

of this section, there shall be added to the federal adjusted gross income of that person for the

taxable year of the withdrawal an amount equal to the lesser of:

(A) The amount equal to the nonqualified withdrawal reduced by the sum of any

administrative fee or penalty imposed under the tuition savings program in connection with the

nonqualified withdrawal plus the earnings portion thereof, if any, includible in computing the

person's federal adjusted gross income for the taxable year; and

(B) The amount of the person's contribution modification pursuant to subsection (c)(4) of

this section for the person's taxable year of the withdrawal and the two (2) prior taxable years less

the amount of any nonqualified withdrawal for the two (2) prior taxable years included in

computing the person's Rhode Island income by application of this subsection for those years. Any

amount added to federal adjusted gross income pursuant to this subdivision shall constitute Rhode

Island income for residents, nonresidents and part-year residents;

(5) The modification described in § 44-30-25.1(d)(3)(i);

(6) The amount equal to any unemployment compensation received but not included in

federal adjusted gross income;

(7) The amount equal to the deduction allowed for sales tax paid for a purchase of a

qualified motor vehicle as defined by the Internal Revenue Code § 164(a)(6); and

(8) For any taxable year beginning on or after January 1, 2020, the amount of any Paycheck

Protection Program loan forgiven for federal income tax purposes as authorized by the Coronavirus

Aid, Relief, and Economic Security Act and/or the Consolidated Appropriations Act, 2021 and/or

any other subsequent federal stimulus relief packages enacted by law, to the extent that the amount

of the loan forgiven exceeds $250,000, including an individual's distributive share of the amount

of a pass-through entity's loan forgiveness in excess of $250,000.

federal adjusted gross income:

(1) Any interest income on obligations of the United States and its possessions to the extent

includible in gross income for federal income tax purposes, and any interest or dividend income on

obligations, or securities of any authority, commission, or instrumentality of the United States to

the extent includible in gross income for federal income tax purposes but exempt from state income

taxes under the laws of the United States; provided, that the amount to be subtracted shall in any

case be reduced by any interest on indebtedness incurred or continued to purchase or carry

obligations or securities the income of which is exempt from Rhode Island personal income tax, to

the extent the interest has been deducted in determining federal adjusted gross income or taxable

income;

(2) A modification described in § 44-30-25(f) or § 44-30-1.1(c)(1);

(3) The amount of any withdrawal or distribution from the "tuition savings program"

referred to in § 16-57-6.1 that is included in federal adjusted gross income, other than a withdrawal

or distribution or portion of a withdrawal or distribution that is a nonqualified withdrawal;

(4) Contributions made to an account under the tuition savings program, including the

"contributions carryover" pursuant to subsection (c)(4)(iv) of this section, if any, subject to the

following limitations, restrictions and qualifications:

(i) The aggregate subtraction pursuant to this subdivision for any taxable year of the

taxpayer shall not exceed five hundred dollars ($500) or one thousand dollars ($1,000) if a joint

return;

(ii) The following shall not be considered contributions:

(A) Contributions made by any person to an account who is not a participant of the account

at the time the contribution is made;

(B) Transfers or rollovers to an account from any other tuition savings program account or

from any other "qualified tuition program" under section 529 of the Internal Revenue Code, 26

U.S.C. § 529; or

(iii) The subtraction pursuant to this subdivision shall not reduce the taxpayer's federal

adjusted gross income to less than zero (0);

(iv) The contributions carryover to a taxable year for purpose of this subdivision is the

excess, if any, of the total amount of contributions actually made by the taxpayer to the tuition

savings program for all preceding taxable years for which this subsection is effective over the sum

of:

(A) The total of the subtractions under this subdivision allowable to the taxpayer for all

such preceding taxable years; and

(B) That part of any remaining contribution carryover at the end of the taxable year which

exceeds the amount of any nonqualified withdrawals during the year and the prior two (2) taxable

years not included in the addition provided for in this subdivision for those years. Any such part

shall be disregarded in computing the contributions carryover for any subsequent taxable year;

(v) For any taxable year for which a contributions carryover is applicable, the taxpayer

shall include a computation of the carryover with the taxpayer's Rhode Island personal income tax

return for that year, and if for any taxable year on which the carryover is based the taxpayer filed a

joint Rhode Island personal income tax return but filed a return on a basis other than jointly for a

subsequent taxable year, the computation shall reflect how the carryover is being allocated between

the prior joint filers;

(5) The modification described in § 44-30-25.1(d)(1);

(6) Amounts deemed taxable income to the taxpayer due to payment or provision of

insurance benefits to a dependent, including a domestic partner pursuant to chapter 12 of title 36 or

other coverage plan;

(7) Modification for organ transplantation.

(i) An individual may subtract up to ten thousand dollars ($10,000) from federal adjusted

gross income if he or she, while living, donates one or more of his or her human organs to another

human being for human organ transplantation, except that for purposes of this subsection, "human

organ" means all or part of a liver, pancreas, kidney, intestine, lung, or bone marrow. A subtract

modification that is claimed hereunder may be claimed in the taxable year in which the human

organ transplantation occurs.

(ii) An individual may claim that subtract modification hereunder only once, and the

subtract modification may be claimed for only the following unreimbursed expenses that are

incurred by the claimant and related to the claimant's organ donation:

(A) Travel expenses.

(B) Lodging expenses.

(iii) The subtract modification hereunder may not be claimed by a part-time resident or a

nonresident of this state;

(8) Modification for taxable Social Security income.

(i) For tax years beginning on or after January 1, 2016:

(A) For a person who has attained the age used for calculating full or unreduced social

security Social Security retirement benefits who files a return as an unmarried individual, head of

household, or married filing separate whose federal adjusted gross income for the taxable year is

less than eighty thousand dollars ($80,000); or

(B) A married individual filing jointly or individual filing qualifying widow(er) who has

attained the age used for calculating full or unreduced social security social security retirement

benefits whose joint federal adjusted gross income for the taxable year is less than one hundred

thousand dollars ($100,000), an amount equal to the social security social security benefits

includible in federal adjusted gross income.

(ii) Adjustment for inflation. The dollar amount contained in subsections (c)(8)(i)(A) and

(c)(8)(i)(B) of this section shall be increased annually by an amount equal to:

(A) Such dollar amount contained in subsections (c)(8)(i)(A) and (c)(8)(i)(B) of this section

adjusted for inflation using a base tax year of 2000, multiplied by;

(B) The cost-of-living adjustment with a base year of 2000.

(iii) For the purposes of this section the cost-of-living adjustment for any calendar year is

the percentage (if any) by which the consumer price index for the preceding calendar year exceeds

the consumer price index for the base year. The consumer price index for any calendar year is the

average of the consumer price index as of the close of the twelve-month (12) period ending on

August 31, of such calendar year.

(iv) For the purpose of this section the term "consumer price index" means the last

consumer price index for all urban consumers published by the department of labor. For the purpose

of this section the revision of the consumer price index which is most consistent with the consumer

price index for calendar year 1986 shall be used.

(v) If any increase determined under this section is not a multiple of fifty dollars ($50.00),

such increase shall be rounded to the next lower multiple of fifty dollars ($50.00). In the case of a

married individual filing separate return, if any increase determined under this section is not a

multiple of twenty-five dollars ($25.00), such increase shall be rounded to the next lower multiple

of twenty-five dollars ($25.00);

(9) Modification for up to fifteen thousand dollars ($15,000) of taxable retirement income

from certain pension plans or annuities.

(i) For tax years beginning on or after January 1, 2017, until the tax year beginning January

1, 2022, a modification shall be allowed for up to fifteen thousand dollars ($15,000), and for tax

years beginning on or after January 1, 2023, a modification shall be allowed for up to twenty

thousand dollars ($20,000), of taxable pension and/or annuity income that is included in federal

adjusted gross income for the taxable year:

(A) For a person who has attained the age used for calculating full or unreduced social

security Social Security retirement benefits who files a return as an unmarried individual, head of

household, or married filing separate whose federal adjusted gross income for such taxable year is

less than the amount used for the modification contained in subsection (c)(8)(i)(A) of this section

an amount not to exceed $15,000 for tax years beginning on or after January 1, 2017, until the tax

year beginning January 1, 2022, and an amount not to exceed twenty thousand dollars ($20,000)

for tax years beginning on or after January 1, 2023, of taxable pension and/or annuity income

includible in federal adjusted gross income; or

(B) For a married individual filing jointly or individual filing qualifying widow(er) who

has attained the age used for calculating full or unreduced social security Social Security retirement

benefits whose joint federal adjusted gross income for such taxable year is less than the amount

used for the modification contained in subsection (c)(8)(i)(B) of this section an amount not to

exceed $15,000 for tax years beginning on or after January 1, 2017, until the tax year beginning

January 1, 2022, and an amount not to exceed twenty thousand dollars ($20,000) for tax years

beginning on or after January 1, 2023, of taxable pension and/or annuity income includible in

federal adjusted gross income.

(ii) Adjustment for inflation. The dollar amount contained by reference in subsections

(c)(9)(i)(A) and (c)(9)(i)(B) of this section shall be increased annually for tax years beginning on

or after January 1, 2018, by an amount equal to:

(A) Such dollar amount contained by reference in subsections (c)(9)(i)(A) and (c)(9)(i)(B)

of this section adjusted for inflation using a base tax year of 2000, multiplied by;

(B) The cost-of-living adjustment with a base year of 2000.

(iii) For the purposes of this section, the cost-of-living adjustment for any calendar year is

the percentage (if any) by which the consumer price index for the preceding calendar year exceeds

the consumer price index for the base year. The consumer price index for any calendar year is the

average of the consumer price index as of the close of the twelve-month (12) period ending on

August 31, of such calendar year.

(iv) For the purpose of this section, the term "consumer price index" means the last

consumer price index for all urban consumers published by the department of labor. For the purpose

of this section, the revision of the consumer price index which is most consistent with the consumer

price index for calendar year 1986 shall be used.

(v) If any increase determined under this section is not a multiple of fifty dollars ($50.00),

such increase shall be rounded to the next lower multiple of fifty dollars ($50.00). In the case of a

married individual filing a separate return, if any increase determined under this section is not a

multiple of twenty-five dollars ($25.00), such increase shall be rounded to the next lower multiple

of twenty-five dollars ($25.00);. and

(vi) For tax years beginning on or after January 1, 2022, the dollar amount contained by

reference in subsection (c)(9)(i)(A) shall be adjusted to equal the dollar amount contained in

subsection (c)(8)(i)(A), as adjusted for inflation, and the dollar amount contained by reference in

subsection(c)(9)(i)(B) shall be adjusted to equal the dollar amount contained in subsection

(c)(8)(i)(B), as adjusted for inflation.;

(10) Modification for Rhode Island investment in opportunity zones. For purposes of a

taxpayer's state tax liability, in the case of any investment in a Rhode Island opportunity zone by

the taxpayer for at least seven (7) years, a modification to income shall be allowed for the

incremental difference between the benefit allowed under 26 U.S.C. § 1400Z-2(b)(2)(B)(iv) and

the federal benefit allowed under 26 U.S.C. § 1400Z-2(c).; and

(11) Modification for military service pensions.

(i) For purposes of a taxpayer’s state tax liability, a modification to income shall be allowed

as follows:

(A) For the tax years beginning on January 1, 2023, a taxpayer may subtract from federal

adjusted gross income the taxpayer’s military service pension benefits included in federal adjusted

gross income;

(ii) As used in this subsection, the term “military service” shall have the same meaning as

set forth in 20 CFR C.F.R. Section § 212.2.;

(iii) At no time shall the modification allowed under this subsection alone or in conjunction

with subsection (c)(9) exceed the amount of the military service pension received in the tax year

for which the modification is claimed.; and

(12) Any rebate issued to the taxpayer pursuant to § 44-30-103 to the extent included in

gross income for federal tax purposes.

(d) Modification for Rhode Island fiduciary adjustment. There shall be added to, or

subtracted from, federal adjusted gross income (as the case may be) the taxpayer's share, as

beneficiary of an estate or trust, of the Rhode Island fiduciary adjustment determined under § 44-

30-17.

(e) Partners. The amounts of modifications required to be made under this section by a

partner, which relate to items of income or deduction of a partnership, shall be determined under §

44-30-15.

SECTION 10. Chapter 30 of Title 44 of the General Laws entitled "Personal Income Tax"

is amended to add Section 103 as follows:

44-30-103. Child Tax Rebates tax rebates.

(a) As used in this section, (1) "child" means an individual who is eighteen years of age or

under as of December 31, 2021, and (2) "eligible taxpayer" means any natural person domiciled in

this state who filed a Rhode Island state personal income tax return for the 2021 taxable year by

the due date for filing said return either as a:

(1) Single, married filing separately, head of household, or qualifying widow/widower

taxpayer with a federal adjusted gross income of $100,000.00 or less for the 2021 taxable year; or

(2) Married filing jointly with a federal adjusted gross income of $200,000.00 or less for

the 2021 taxable year.

(b) (1) An eligible taxpayer will be issued a rebate payment in the amount of two hundred

fifty dollars for each child, up to a maximum of three children, who whom the eligible taxpayer

validly claims as a dependent on such taxpayer's Rhode Island state personal income tax return

properly filed with this state for the 2021 taxable year by the due date for filing said return.

(2) The rebate amount shall be determined by the division of taxation based on the eligible

taxpayer's Rhode Island state personal income tax return filed for the 2021 taxable year in

accordance with this section and no determination shall be based on amended filings received by

the division of taxation after August 31, 2022.

(3) In the case of a married couple filing separately, the rebate payment will be made to the

eligible taxpayer making the filing and in the case of a married couple filing jointly, the rebate

payment will be made jointly to the eligible taxpayers.

(4) Rebate payments made under this subsection shall not be subject to offset pursuant to

chapter 44-30.1 of this title and shall not be considered income for the purposes of state personal

income tax under this chapter 44-30 or for determining eligibility for any state program.

(5) In no event shall the rebate amount provided for in this section accrue interest for the

benefit of any eligible taxpayer.

(6) In addition to all other penalties provided under Rhode Island state law, any eligible

taxpayer that fraudulently claims a dependent on the taxpayer's Rhode Island state personal income

tax return shall pay a ten thousand dollar ($10,000) penalty for each dependent fraudulently claimed

and shall pay any rebate amount fraudulently received. The tax administrator shall have the same

powers to collect payment under this subsection as under title 44 of the general laws.

SECTION 11. Section 44-33-9 of the General Laws in Chapter 44-33 entitled "Property

Tax Relief" is hereby amended to read as follows:

44-33-9. Computation of credit.

The amount of any claim made pursuant to this chapter shall be determined as follows:

(1) For any taxable year, a claimant is entitled to a credit against his or her tax liability

equal to the amount by which the property taxes accrued or rent constituting property taxes accrued

upon the claimant's homestead for the taxable year exceeds a certain percentage of the claimant's

total household income for that taxable year, which percentage is based upon income level and

household size. The credit shall be computed in accordance with the following table:

Income Range 1 Person 2 or More Persons

less than $6000 3% 3%

$6001-9000 4% 4%

$9001-12000 5% 5%

$12001-15000 6% 5%

$15001-30000 35000 6% 6%

(2) The maximum amount of the credit granted under this chapter will be as follows:

Year Credit Maximum

Commencing July 1977 $55.00

Commencing July 1978 $150.00

Commencing July 1979 $175.00

Commencing July 1980 $200.00

Commencing on July 1997 and subsequent years $250.00

Commencing on July 2006 $300.00

Commencing July 2007 and subsequent years and subsequent tax years ending on or before

December 31, 2021, the credit shall be increased, at a minimum, to the maximum amount to the

nearest five dollars ($5.00) increment within the allocation of five one-hundredths of one percent

(0.05%) of net terminal income derived from video lottery games up to a maximum of five million

dollars ($5,000,000) until a maximum credit of five hundred dollars ($500) is obtained pursuant to

the provisions of § 42-61-15. In no event shall the exemption in any fiscal year be less than the

prior fiscal year.

For tax years beginning on or after January 1, 2022, the maximum credit shall be six

hundred dollars ($600).

For tax years beginning on or after January 1, 2023, the income range provided pursuant

to subsection (1) of this section and the maximum credit granted pursuant to subsection (2) of this

section shall be adjusted by the percentage increase in the Consumer Price Index for all Urban

Consumers (CPI-U) as published by the United States Department of Labor Statistics determined

as of September 30 of the prior calendar years. Said adjustment shall be compounded annually and

shall be rounded up to the nearest five dollar ($5.00) increment. In no event shall the income range

or the maximum credit in any tax year be less than the prior tax year.

SECTION 12. Chapter 44-34.1 of the General Laws entitled "Motor Vehicle and Trailer

Excise Tax Elimination Act of 1998" is hereby amended by adding thereto the following section:

44-34.1-5. Excise tax elimination.

(a) Notwithstanding any provisions of the general or public laws to the contrary, for each

city, town, and fire district, except for the city of East Providence:

(1) The motor vehicle and trailer excise tax established by § 44-34-1 shall be repealed

effective July 1, 2022. For fiscal year 2023 and thereafter, no tax shall be levied.

(2) For fiscal year 2023, each city, town, and fire district shall receive a reimbursement

equal to the amount it received in fiscal year 2017 plus its FY 2018 baseline amount (“FY 2023

reimbursement amount”). A city, town, or fire district is entitled to receive additional

reimbursement in fiscal year 2023 as follows:

(i) If the department of revenue certifies that a city, town, or fire district’s budgeted motor

vehicle levy for the assessment date of December 31, 2021, is in excess of its FY 2023

reimbursement amount, the city, town, or fire district shall be reimbursed the difference between

such motor vehicle levy and its FY 2023 reimbursement amount.

(3) Any fire district reimbursement amounts outstanding as of the effective date of this act

shall be distributed by August 1, 2022.

(4) For fiscal year 2024 and thereafter, cities, towns, and fire districts shall receive

reimbursements in accordance with § 44-34.1-2.

(b) Notwithstanding any provisions of the general or public laws to the contrary, for the

city of East Providence the following shall apply:

(1) It shall levy the excise tax in its fiscal year 2022 because its implementation of the

phase out was delayed by one year to match its fiscal year; provided, however, it shall apply the

phase-out parameters for fiscal year 2023 as set forth in §§ 44-34-11 and 44-34.1-1.

(2) The motor vehicle and trailer excise tax established by § 44-34-1 shall be repealed

effective July 1, 2023.

(3) For its fiscal year 2023 and thereafter, no tax shall be levied, and the city of East

Providence shall receive reimbursements in accordance with § 44-34.1-2.

SECTION 13. Section 45-13-14 of the General Laws in Chapter 45-13 entitled "State Aid"

is hereby amended to read as follows:

45-13-14. Adjustments to tax levy, assessed value, and full value when computing state

aid.

(a) Whenever the director of revenue computes the relative wealth of municipalities for the

purpose of distributing state aid in accordance with title 16 and the provisions of § 45-13-12, he or

she shall base it on the full value of all property except:

(1) That exempted from taxation by acts of the general assembly and reimbursed under §

45-13-5.1 of the general laws, which shall have its value calculated as if the payment in lieu of tax

revenues received pursuant to § 45-13-5.1, has resulted from a tax levy;

(2) That whose tax levy or assessed value is based on a tax treaty agreement authorized by

a special public law or by reason of agreements between a municipality and the economic

development corporation in accordance with § 42-64-20 prior to May 15, 2005, which shall not

have its value included;

(3) That whose tax levy or assessed value is based on tax treaty agreements or tax

stabilization agreements in force prior to May 15, 2005, which shall not have its value included;

(4) That which is subject to a payment in lieu of tax agreement in force prior to May 15,

2005;

(5) Any other property exempt from taxation under state law; or

(6) Any property subject to chapter 27 of title 44, taxation of Farm, Forest, and Open Space

Land.; or

(7) Any property exempt from taxation, in whole or in part, under the provisions of

subsections (a)(51), (a)(66), or (c) of § 44-3-3, § 44-3-47, § 44-3-65, or any other provision of law

that enables a city, town, or fire district to establish a tangible personal property exemption, which

shall have its value calculated as the full value of the property minus the exemption amount.

(b) The tax levy of each municipality and fire district shall be adjusted for any real estate

and personal property exempt from taxation by act of the general assembly by the amount of

payment in lieu of property tax revenue anticipated to be received pursuant to § 45-13-5.1 relating

to property tax from certain exempt private and state properties, and for any property subject to any

payment in lieu of tax agreements, any tax treaty agreements or tax stabilization agreements in

force after May 15, 2005, by the amount of the payment in lieu of taxes pursuant to such

agreements.

attributable to that city or town.

(d) The changes as required by subsections (a) through (c) of this section shall be

incorporated into the computation of entitlements effective for distribution in fiscal year 2007-2008

and thereafter.

SECTION 14. Section 8 of this article shall take effect on October 1, 2022. Sections 1

through 7 and Sections 9 through 13 shall take effect upon passage.