2003 -- S 1127 AS AMENDED
RELATING TO TAXATION
Introduced By: Senator Stephen D. Alves
Date Introduced: June 10, 2003
It is enacted by the General Assembly as follows:
SECTION 1. Section 44-48.1-1 of the General Laws in Chapter 44-48.1 entitled "Tax
Expenditure Reporting" is hereby amended to read as follows:
44-48.1-1. Tax expenditure reporting. -- (a) On or before the second Tuesday in
each year beginning
in 1998 each even numbered year beginning in 2004, the state tax
administrator, to the extent possible within the appropriations provided for the purpose, shall
deliver a tax expenditure report to
the general assembly.
The report for 1998 will provide the minimum information for
twenty-five percent (25%) of existing tax expenditures. The report for 1999 will provide the required
information for an additional twenty-five percent (25%) of the tax expenditures so that fifty
percent (50%) of the tax expenditures will have been presented. The report for 2,000 will provide
the information for an additional twenty-five percent (25%) so that seventy-five percent (75%) of
the tax expenditures in effect will have been presented. The report for 2001 will provide the
information for an additional twenty-five percent (25%) so that one hundred percent (100%) of the
tax expenditures in effect will have been reported. Each report will
provide the minimum information for one hundred percent (100%) of tax expenditures in effect
on January 1 of the calendar year preceding the report's publication.
(b) For the purposes of this section; a "tax expenditure" is any tax credit, deduction,
exemption, exclusion, credit preferential tax rate, tax abatement, and tax deferral that provides
preferential treatment to selected taxpayers, whether directly through Rhode Island general laws
or Constitutional provisions or indirectly through adoption of other tax codes.
or before the second Tuesday in January of 2002 and each year after this, the
tax administrator shall deliver a
tax expenditure report to the general assembly providing the minimum information for
twenty-five percent (25%) of existing tax expenditures so that the information provided on any
expenditure will have been reported no more than four (4) years prior.
The information included for each tax expenditure shall include, but not be limited to:
legislative history of the expenditure and its legal reference The legal
of the expenditures, including information whether the expenditure is required as a result of
federal or state constitutional, judicial, or statutory mandate.
Amount of revenues forgone
. or an estimate, if the actual amount
determined, for the calendar year immediately preceding the publication of the report. The report
shall also include an estimate of revenue forgone for the calendar year in which the report is
published and the year following the report's publication. The tax administrator shall develop an
index of the reliability of each estimate using five (5) levels with level one being most reliable.
Where actual tax returns are the source of the estimate, the estimate should be assigned reliability
level one. Where no reliable data exists for the estimate, the estimate should be assigned
reliability level five (5). The reliability level shall be reported for the estimate of the revenues
(3) To the extent allowable by law, identification of the beneficiaries of the exemption
by number, income, class and industry.
(4) A comparison of the tax expenditure to the tax systems of the other New England
states, with emphasis on Massachusetts and Connecticut.
of the beneficiary's state tax burden. The data source(s) and analysis
(6) To the extent allowable by law, identification of similar taxpayers or industries that
do not enjoy the exemption.
or before the second Tuesday in January of 1997, the tax administrator shall prepare and submit an inventory
of tax expenditures with the schedule for estimating them as prescribed in this section. The
schedule should include an initial estimate of reliability for each item on the schedule and may
include any other information, including costs associated with completing the schedules, that
the tax administrator deems appropriate. Each report shall include
a section containing recommendations for improving the effectiveness of the report as a tax
policy tool. This section shall identify the resources required to implement these
recommendations and shall also contain an estimate of the costs associated with such
(e) On or before the second Tuesday in January 2004, the state tax administrator shall
make available to the general assembly a plan to improve Rhode Island's tax expenditure
reporting effort. The plan shall include measurable criteria to evaluate improvements in the
reliability of tax expenditure item estimates and the identification of beneficiaries of each tax
expenditure by number, income, class and industry. The plan shall also include cost estimates of
additional resources necessary to implement the plan, and may include any other information that
the tax administrator deems appropriate for inclusion in said plan.
SECTION 2. This act shall take effect upon passage.