Should state lawmakers change the way banks are taxed to primarily benefit Citizens Bank?

CITIZENS BANK wants lawmakers to change the formula for how banks are taxed, to exclude payroll and property. /PHOTO COURTESY CITIZENS FINANCIAL GROUP

State lawmakers are considering an 11th-hour budget proposal from Gov. Daniel J. McKee to overhaul the way banks are taxed.

The proposal was made at the request of the parent of Providence-based Citizens Bank, which employs more than 4,300 in Rhode Island.

Citizens wants the formula used to tax banks changed to only be based on in-state sales. Currently, the formula factors in sales, payroll and property.

Twenty-six states have passed similar legislation, including Massachusetts beginning next year.

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The state would lose an estimated $15.6 million from the change in fiscal 2025. But that would be largely offset by increased state revenue tied to other tax credits the bank no longer qualifies for.

Should state lawmakers change the way banks are taxed to primarily benefit Citizens Bank?

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