When people suggest Rhode Island is anti-business, it is the result of legislative proposals such as the one introduced recently by Warwick Rep. Joseph A. Trillo, R-Dist. 36, in a bill he suggests is meant to help small businesses at the expense of the very large ones.
Trillo is suggesting that some retailers are being forced out of business by the “mega monster” stores, and that it is costing the state revenue and jobs, and striking at the very core of our business community, small businesses.
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He suggests taxing — he calls it an “impact fee” — those retailers whose parent companies gross more than $20 billion annually worldwide. The 5 percent fee would be imposed on Rhode Island sales only, and when the amount collected by the division of taxation reaches $100 million (that would mean Rhode Island sales of $2 billion), it would reduce the state sales tax by 1 percent.
If this were ever to pass, we suspect some retailers might choose to leave Rhode Island, directing customers to nearby stores in Connecticut or Massachusetts, and it would send a strong signal once again reinforcing the perception of an anti-business climate in Rhode Island.
We don’t think this bill has a remote chance of passage, and would hope that the legislature considers full well that the stores that would be involved are good corporate citizens, employing thousands of Rhode Islanders, paying millions in corporate and other taxes.
To think that imposing a financial penalty on the largest of stores will revive those small businesses that could not compete is folly. In every industry we have seen evolution move toward consolidation, bigger companies with mega stores, from the super supermarkets that replaced the market and corner grocer, to the Wal-Marts, at which this bill was obviously directed.
Smaller stores need to compete by becoming vital to the customers, providing unique merchandise in an atmosphere that is welcoming, friendly and service oriented. And, yes, they need to be price competitive as well.
Now, some of those stores that Trillo would have pay that additional 5 percent: Wal-Mart, Target, McDonald’s, Home Depot, Loew’s and CVS.
