Rhode Islanders pay more in property tax than most taxpayers throughout the nation, according to a report released earlier this year by the Rhode Island Expenditure Council (RIPEC).
The report ranks the Ocean State sixth among the nation’s states with the highest property tax burdens. Property tax collections of $46.45 per $1,000 of personal income in Rhode Island rank the state 43 percent above the U.S. average ($32.52) and above the New England average of $41.62.
Seifert Systems Invests in Energy Efficiency to Strengthen Operations
For manufacturers, energy is more than just another operating expense. It plays a critical role…
Learn More
Rhode Islanders pay more in property taxes, according to the study, than they pay in any other single tax including personal income, general sales and all business-specific takes.
This news comes as no surprise, but the fact that we expect to hear it year after year makes it no less disheartening. RIPEC has consistently recommended the state examine ways to alleviate the property tax burden – both on property owners and business owners as well.
The state clearly missed a golden opportunity years ago when the economy was strong. Money was returned to taxpayers in the form of aid to cities and towns, but that represented a short-term fix. No sweeping changes were enacted to alleviate the state’s over-reliance on property taxes.
Now, facing a sharp deficit, it is inconceivable to expect major tax structure changes.
We do support RIPEC’s latest recommendation, that a cap on property tax increases be tightened so that as years pass, Rhode Island falls closer to the national average in terms of property tax burden. Then, when the economic climate improves, more significant structural should be considered.
The current tax system makes this an expensive place to live. And an expensive place to grow a business. It is a cost structure that does not go unnoticed by decision-makers who play such a vital role in heating our economic climate. This week, for example, we publish excerpts from an interview of six recent inductees into the University of Rhode Island College of Business Administration’s Hall of Fame.
Here is what two of them had to say in response to a question about the state’s economy. Alan G. Hassenfeld, chairman and chief executive officer of Hasbro, Inc.: “I can’t continue to attract good people to the state of Rhode Island with the tax rate that we pay…This is a wonderful state to live in, but you have to attract people with ideas and thoughts to create business, and it’s not the most hospitable place to set up your business…”
Peter Bassi, president and chief executive officer of Tricon Restaurants International: “I looked at buying a place because I figured I was going to be spending a lot of time here…I couldn’t believe what property taxes were.”
Maybe this should be the summer assignment for our legislators.
Let’s see them come back with some real ideas for tax reform. Because the system now in place is not good for building the economy. And that’s not good for anyone.
