Page 1

2011 -- H 5894 ======= LC02105 =======

STATE

OF

RHODE

ISLAND

IN GENERAL ASSEMBLY JANUARY SESSION, A.D. 2011 ____________ AN ACT RELATING TO MAKING APPROPRIATIONS FOR THE SUPPORT OF THE STATE FOR THE FISCAL YEAR ENDING JUNE 30, 2012

Introduced By: Representative Helio Melo Date Introduced: March 09, 2011 Referred To: House Finance

It is enacted by the General Assembly as follows: 1

ARTICLE 1

RELATING TO MAKING APPROPRIATIONS IN SUPPORT OF FY 2012

2

ARTICLE 2

RELATING TO MAKING SUPPLEMENTAL APPROPRIATIONS FOR F2011

3

ARTICLE 3

RELATING TO BUDGET RESERVE FUND

4

ARTICLE 4

RELATING TO SECURITY--UNEMPLOYMENT INSURANCE

5

ARTICLE 5

RELATING TO EDUCATION AID

6

ARTICLE 6

RELATING TO DEPARTMENT OF ENVIRONMENTAL MANAGEMENT

7

ARTICLE 7

RELATING TO THE RHODE ISLAND TELECOMMUNICATIONS

8

EDUCATION ACCESS FUND

9

ARTICLE 8

RELATING TO LONGEVITY PAYMENTS

10

ARTICLE 9

RELATING TO GOVERNMENTAL ORGANIZATION

11

ARTICLE 10

RELATING TO THE DEPARTMENT OF EDUCATION

12

ARTICLE 11 RELATING TO THE CHILDREN’S HEALTH ACCOUNT

13

ARTICLE 12 RELATING TO SCHOOL HOUSING AID FOR CHARTER PUBLIC

14

SCHOOLS

15

ARTICLE 13 RELATING TO RETIREMENT--CONTRIBUTION RATES

16

ARTICLE 14 RELATING TO THE TOURISM ASSET PROTECTION FUND

17

ARTICLE 15 RELATING TO MANAGEMENT AND DISPOSAL OF PROPERTY

18

ARTICLE 16

RELATING TO THE MEDICAID REFORM ACT


1 2

ARTICLE 17 RELATING TO GENERAL PUBLIC ASSISTANCE HARDSHIP CONTINGENCY FUND

3

ARTICLE 18 RELATING TO HOSPITAL UNCOMPENSATED CARE

4

ARTICLE 19 RELATING TO LICENSING OF HOSPITAL FACILITIES

5

ARTICLE 20 RELATING TO LICENSES AND FEES

6

ARTICLE 21 RELATING TO RHODE ISLAND PUBLIC RAIL CORPORATION

7

ARTICLE 22 RELATING TO REGISTRATION FEES

8

ARTICLE 23 RELATING TO DIVISION OF SHERIFFS

9

ARTICLE 24 RELATING TO DEPARTMENT OF REVENUE--

10 11 12

REVENUES/FEES/COLLECTIONS ARTICLE 25 RELATING TO THE DEPARTMENT OF REVENUE--CORPORATE COMPETITIVENESS TAX REFORM

13

ARTICLE 26 RELATING TO SALES TAX MODERNIZATION

14

ARTICLE 27 RELATING TO PHARMACEUTICAL ASSISTANCE TO THE ELDERLY

15

ARTICLE 28 RELATING TO VETERANS’ HOME

16

ARTICLE 29 RELATING TO DEPARTMENT OF HEALTH--ELIMINATION OF

17 18 19 20 21

CERTIFICATE OF NEED ARTICLE 30 RELATING TO MEDICAL ASSISTANCE NURSING FACILITIES RATE REFORM ARTICLE 31 RELATING TO HUMAN SERVICES--ABUSED AND NEGLECTED CHILDREN

22

ARTICLE 32 RELATING TO EDUCATION--JUVENILE CORRECTIONS

23

ARTICLE 33 RELATING TO HOSPITAL PAYMENT RATES

24

ARTICLE 34 RELATING TO DEPARTMENT OF TRANSPORTATION--TOLLING OF

25

STATE HIGHWAYS

26

ARTICLE 35 RELATING TO REGISTRATION OF MOTOR VEHICLES

27

ARTICLE 36 RELATING TO STATE PROPERTY--LEASES

28

ARTICLE 37 RELATING TO THE UNCLASSIFIED SERVICE

29

ARTICLE 38 RELATING TO RETIREE HEALTH CARE TRUST FUND

30

ARTICLE 39 RELATING TO MUNICIPAL ACCOUNTABILITY, STABILITY AND

31

TRANSPARENCY FUND

32

ARTICLE 40 RELATING TO DISTRESSED COMMUNITIES

33

ARTICLE 41 RELATING TO RESTRICTED RECEIPTS ACCOUNTS

34

ARTICLE 42 RELATING TO BORROWING IN ANTICIPATION OF RECEIPTS FROM

2


1 2

TAXES ARTICLE 43 RELATING TO EFFECTIVE DATE

3

3


1

ARTICLE 26

2

RELATING TO SALES TAX MODERNIZATION

3 4

SECTION 1. Chapter 42-64 of the General Laws entitled “Economic Development Corporation” is hereby amended as follows:

5

42-64-20. Exemption from taxation. -- (a) The exercise of the powers granted by this

6

chapter will be in all respects for the benefit of the people of this state, the increase of their

7

commerce, welfare, and prosperity and for the improvement of their health and living conditions

8

and will constitute the performance of an essential governmental function and the corporation

9

shall not be required to pay any taxes or assessments upon or in respect of any project or of any

10

property or moneys of the Rhode Island economic development corporation, levied by any

11

municipality or political subdivision of the state; provided, that the corporation shall make

12

payments in lieu of real property taxes and assessments to municipalities and political

13

subdivisions with respect to projects of the corporation located in the municipalities and political

14

subdivisions during those times that the corporation derives revenue from the lease or operation

15

of the projects. Payments in lieu of taxes shall be in amounts agreed upon by the corporation and

16

the affected municipalities and political subdivisions. Failing the agreement, the amounts of

17

payments in lieu of taxes shall be determined by the corporation using a formula that shall

18

reasonably ensure that the amounts approximate the average amount of real property taxes due

19

throughout the state with respect to facilities of a similar nature and size. Any municipality or

20

political subdivision is empowered to accept at its option an amount of payments in lieu of taxes

21

less than that determined by the corporation. If, pursuant to § 42-64-13(f), the corporation shall

22

have agreed with a municipality or political subdivision that it shall not provide all of the

23

specified services, the payments in lieu of taxes shall be reduced by the cost incurred by the

24

corporation or any other person in providing the services not provided by the municipality or

25

political subdivision.

26

(b) The corporation shall not be required to pay state taxes of any kind, except as

27

otherwise provided in § 44-18-12.2, and the corporation, its projects, property, and moneys and,

28

except for estate, inheritance, and gift taxes, any bonds or notes issued under the provisions of

29

this chapter and the income (including gain from sale or exchange) from these shall at all times be

30

free from taxation of every kind by the state and by the municipalities and all political

31

subdivisions of the state. The corporation shall not be required to pay any transfer tax of any kind

32

on account of instruments recorded by it or on its behalf.

33

(c) For purposes of the exemption from taxes and assessments upon or in respect of any

34

project under subsections (a) or (b) of this section, the corporation shall not be required to hold

164


1

legal title to any real or personal property, including any fixtures, furnishings or equipment which

2

are acquired and used in the construction and development of the project, but the legal title may

3

be held in the name of a lessee (including sub-lessees) from the corporation. This property, which

4

shall not include any goods or inventory used in the project after completion of construction, shall

5

be exempt from taxation to the same extent as if legal title of the property were in the name of the

6

corporation; provided that the board of directors of the corporation adopts a resolution confirming

7

use of the tax exemption for the project by the lessee. Such resolution shall not take effect until

8

thirty (30) days from passage. The resolution shall include findings that: (1) the project is a

9

project of the corporation under ยง 42-64-3(20), and (2) it is in the interest of the corporation and

10

of the project that legal title be held by the lessee from the corporation. In adopting the resolution,

11

the board of directors may consider any factors it deems relevant to the interests of the

12

corporation or the project including, for example, but without limitation, reduction in potential

13

liability or costs to the corporation or designation of the project as a "Project of Critical Economic

14

Concern" pursuant to Chapter 117 of this title.

15

(d) For purposes of the exemption from taxes and assessments for any project of the

16

corporation held by a lessee of the corporation under subsection (c) of this section, any such

17

project shall be subject to the following additional requirements:

18

(1) The total sales tax exemption benefit to the lessee will be implemented through a

19

reimbursement process as determined by the division of taxation rather than an up-front purchase

20

exemption;

21

(2) The sales tax benefits granted pursuant to RIGL 42-64-20(c) shall: (i) only apply to

22

materials used in the construction, reconstruction or rehabilitation of the project and to the

23

acquisition of furniture, fixtures and equipment, except automobiles, trucks or other motor

24

vehicles, or materials that otherwise are depreciable and have a useful life of one year or more,

25

for the project for a period not to exceed six (6) months after receipt of a certificate of occupancy

26

for any given phase of the project for which sales tax benefits are utilized; and (ii) not exceed an

27

amount equal to the income tax revenue received by the state from the new full-time jobs with

28

benefits excluding project construction jobs, generated by the project within a period of three (3)

29

years from after the receipt of a certificate of occupancy for any given phase of the project. "Full-

30

time jobs with benefits" means jobs that require working a minimum of thirty (30) hours per

31

week within the state, with a median wage that exceeds by five percent (5%) the median annual

32

wage for the preceding year for full-time jobs in Rhode Island, as certified by the department of

33

labor and training with a benefit package that is typical of companies within the lessee's industry.

34

(3) The corporation shall transmit the analysis required by RIGL 42-64-10(a)(2) to the

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1

house and senate fiscal committee chairs, the department of labor and training and the division of

2

taxation promptly upon completion. Annually thereafter, the department of labor and training

3

shall certify to the house and senate fiscal committee chairs, the house and senate fiscal advisors,

4

the corporation and the division of taxation the actual number of new full-time jobs with benefits

5

created by the project, in addition to construction jo bs, and whether such new jobs are on target to

6

meet or exceed the estimated number of new jobs identified in the analysis above. This

7

certification shall no longer be required when the total amount of new income tax revenue

8

received by the state exceeds the amount of the sales tax exemption benefit granted above.

9

(4) The department of labor and training shall certify to the house and senate fiscal

10

committee chairs and the division of taxation that jobs created by the project are "new jobs" in the

11

state of Rhode Island, meaning that the employees of the project are in addition to, and without a

12

reduction of, those employees of the lessee currently employed in Rhode Island, are not relocated

13

from another facility of the lessee's in Rhode Island or are employees assumed by the lessee as

14

the result of a merger or acquisition of a company already located in Rhode Island. Additionally,

15

the corporation, with the assistance of the lessee, the department of labor and training, the

16

department of human services and the division of taxation shall provide annually an analysis of

17

whether any of the employees of the project qualify for RIte Care or RIte Share benefits and the

18

impact such benefits or assistance may have on the state budget.

19

(5) Notwithstanding any other provision of law, the division of taxation, the department

20

of labor and training and the department of human services are authorized to present, review and

21

discuss lessee specific tax or employment information or data with the corporation, the house and

22

senate fiscal committee chairs, and/or the house and senate fiscal advisors for the purpose of

23

verification and compliance with this resolution; and

24

(6) The corporation and the project lessee shall agree that, if at any time prior to the state

25

recouping the amount of the sales tax exemption through new income tax collections from the

26

project, not including construction job income taxes, the lessee will be unable to continue the

27

project, or otherwise defaults on its obligations to the corporation, the lessee shall be liable to the

28

state for all the sales tax benefits granted to the project plus interest, as determined in RIGL 44-1-

29

7, calculated from the date the lessee received the sales tax benefits.

30 31

SECTION 2. Section 44-18-7 of the General Laws in Chapter 44-18 entitled “Sales and Use Taxes – Liability and Computation” is hereby amended to read as follows:

32

44-18-7. Sales defined. -- "Sales" means and includes:

33

(1) Any transfer of title or possession, exchange, barter, lease, or rental, conditional or

34

otherwise, in any manner or by any means of tangible personal property for a consideration.

166


1

"Transfer of possession", "lease", or "rental" includes transactions found by the tax administrator

2

to be in lieu of a transfer of title, exchange, or barter.

3

(2) The producing, fabricating, processing, printing, or imprinting of tangible personal

4

property for a consideration for consumers who furnish either directly or indirectly the materials

5

used in the producing, fabricating, processing, printing, or imprinting.

6 7 8 9 10 11

(3) The furnishing and distributing of tangible personal property for a consideration by social, athletic, and similar clubs and fraternal organizations to their members or others. (4) The furnishing, preparing, or serving for consideration of food, meals, or drinks, including any cover, minimum, entertainment, or other charge in connection therewith. (5) A transaction whereby the possession of tangible personal property is transferred, but the seller retains the title as security for the payment of the price.

12

(6) Any withdrawal, except a withdrawal pursuant to a transaction in foreign or interstate

13

commerce, of tangible personal property from the place where it is located for delivery to a point

14

in this state for the purpose of the transfer of title or possession, exchange, barter, lease, or rental,

15

conditional or otherwise, in any manner or by any means whatsoever, of the property for a

16

consideration.

17

(7) A transfer for a consideration of the title or possession of tangible personal property,

18

which has been produced, fabricated, or printed to the special order of the customer, or any

19

publication.

20 21

(8) The furnishing and distributing of electricity, natural gas, artificial gas, steam, refrigeration, and water.

22

(9) The furnishing for consideration of intrastate, interstate and international

23

telecommunications service sourced in this state in accordance with subsections 44-18.1(15) and

24

(16) and all ancillary services, any maintenance services of telecommunication equipment other

25

than as provided for in subdivision 44-18-12(b)(ii). For the purposes of chapters 18 and 19 of this

26

title only, telecommunication service does not include service rendered using a prepaid telephone

27

calling arrangement. (ii) Notwithstanding the provisions of paragraph (i) of this subdivision, in

28

accordance with the Mobile Telecommunications Sourcing Act (4 U.S.C. §§ 116 – 126), subject

29

to the specific exemptions described in 4 U.S.C. § 116(c), and the exemptions provided in §§ 44-

30

18-8 and 44-18-12, mobile telecommunications services that are deemed to be provided by the

31

customer's home service provider are subject to tax under this chapter if the customer's place of

32

primary use is in this state regardless of where the mobile telecommunications services originate,

33

terminate or pass through. Mobile telecommunications services provided to a customer, the

34

charges for which are billed by or for the customer's home service provider, shall be deemed to be

167


1

provided by the customer's home service provider.

2

(10) The furnishing of service for transmission of messages by telegraph, cable, or radio

3

and the furnishing of community antenna television, subscription television, and cable television

4

services.

5

(11) The rental of living quarters in any hotel, rooming house, or tourist camp.

6

(12) The transfer for consideration of prepaid telephone calling arrangements and the

7

recharge of prepaid telephone calling arrangements sourced to this state in accordance with §§

8

44-18.1-11 and 44-18.1-15. "Prepaid telephone calling arrangement" means and includes prepaid

9

calling service and prepaid wireless calling service.

10

(13) The furnishing of services in this state as defined in § 44-18-7.3.

11

(14) The sale, storage, use, or other consumption in this state of any newspaper as defined

12

in § 44-18-7.4.

13 14

(15) The sale, storage, use or other consumption of over-the-counter drugs as defined in § 44-18-7.1(h)(ii).

15 16

(16) The sale, storage, use or other consumption of prewritten computer software delivered electronically or by load and leave as defined in § 4-18-7.1(g).

17 18

(17) The sale, storage, use or other consumption of medical marijuana as defined in § 2128.6-3.

19

(18) The sale, storage, use or other consumption of “Specified digital products” as

20

defined in § 44-18-7.5 transferred electronically whereby the purchaser obtains the product by

21

means other than tangible storage media.

22 23

SECTION 3. Chapter 44-18 of the General Laws entitled “Sales and Use Taxes – Liability and Computation” is hereby amended by adding thereto the following sections:

24

44-18-7.3. Services defined. -- (a) “Services” means all activities engaged in for other

25

persons for a fee, retainer, commission, or other monetary charge, which activities involve the

26

performance of a service in this state as distinguished from selling property. In determining what

27

is a service, the intended use, principal objective or ultimate objective of the contracting parties

28

shall not be controlling. For the purposes of this section, services rendered by an employee for

29

his./her employer are not taxable.

30

(b) The following businesses and services performed in this state along with the

31

applicable 2007 North American Industrial Classification System (NAICS) codes are included in

32

the definition of services:

33

(1) Software publishers (511210) (delivered electronically).

34

(2) Taxicab and limousine services including, but not limited to:

168


1

(i) Taxicab services including taxi dispatchers (485310); and

2

(ii) Limousine services (485320).

3

(3) Other road transportation service including, but not limited to:

4

(i) Charter bus service (485510); and

5

(ii) All other transit and ground passenger transportation (485999).

6

(4) Moving, storage and freight services, including, but not limited to:

7

(i) General freight services - local (484110);

8

(ii) Household and office goods moving services (484210);

9

(iii) General warehousing and storage (493110);

10

(iv) Refrigerated warehousing and storage (493120);

11

(vii) Farm product warehousing and storage (493130);

12

(viii) Other warehousing and storage (493190); and

13

(ix) Mini-warehouses and self-storage units (531130).

14

(5) Motion picture theaters (512131) and drive-in motion picture theaters (512132).

15

(6) Photo studios and commercial photography including, but not limited to:

16

(i) Photo studios (541921); and

17

(ii) Commercial photography (541922).

18

(7) Facilities support services (561210).

19

(8) Employment services including, but not limited to:

20

(i) Employment placement agencies (561311);

21

(ii) Executive placement agencies (561312);

22

(iii) Temporary help services (561320); and

23

(iv) Professional employer organizations (561330).

24

(9) Business support services including, but not limited to:

25

(i) Document preparation services (561410); and

26

(ii) Telephone call centers (561422);

27

(10) Package tours and tour operators including, but not limited to:

28

(i) Package tours including travel agencies (561510); and

29

(ii) Tour operators (561520).

30

(11) Investigation and security services including, but not limited to:

31

(i) Investigation (561611);

32

(ii) Security guard and patrol services (561612);

33

(iii) Armored car services (561613);

34

(iv) Security systems services (561621); and

169


1

(v) Locksmiths (561622).

2

(12) Services to buildings and dwellings; excluding heavy and civil engineering

3

construction (Major Sector 237) and residential maintenance and repair (Major Sector 238)

4

including, but not limited to:

5

(i) Exterminating and pest control services (561710);

6

(ii) Janitorial services (561720) (excluding residential);

7

(iii) Landscaping services (561730);

8

(iv) Carpet and upholstery cleaning services (561740); and

9

(v) Other services to buildings and dwellings (561790).

10

(13) Other support services including, but not limited to:

11

(i) Packaging and labeling services (561910); and

12

(ii) Convention and trade show organizers (561920).

13

(14) Waste management and remediation services including, but not limited to:

14

(i) Solid waste collection, garbage and trash collection (562111);

15

(ii) Hazard waste collection (562112);

16

(iii) Other waste collection (562119);

17

(iv) Hazardous waste treatment and disposal (562211);

18

(v) Solid waste landfill (562212);

19

(vi) Solid waste combustors and incinerators (562213);

20

(vii) Other nonhazardous waste treatment and disposal (562219);

21

(viii) Remediation services (562910);

22

(ix) Materials recovery facilities (562920);

23

(x) Septic tank and related services (562991); and

24

(xi) All other miscellaneous waste management services (562998).

25

(15) Membership clubs and participant sports centers including, but not limited to:

26

(i) Membership clubs (813410);

27

(ii) Participant sports centers, including flight training schools (611512); and

28

(iii) Skiing facilities (713920).

29

(16) Fitness and recreational sports centers (713940).

30

(17) Amusement parks, campgrounds and related recreational services including, but not

31

limited to:

32

(i) Amusement parks (713110);

33

(ii) Arcades (713120);

34

(iii) Campgrounds (721211);

170


1

(iv) Providers of instruction or classes in dance, music, art and similar activities, except

2

when provided by an accredited institution of higher education;

3

(v) Sports and recreation instruction (611620);

4

(vi) Promoters or providers of performing arts, sports, and similar events (711310) and

5

(711320);

6

(vii) Botanical or zoological gardens (712130);

7

(viii) Nature parks and reserves (712190); and

8

(ix) Coin-operated amusement machines (713120).

9

(18) Other amusement and recreational industries including, but not limited to:

10

(i) Golf courses and country clubs (713910);

11

(ii) Skiing facilities (713920);

12

(iii) Bowling centers (713950); and

13

(iv) All other amusement and recreation industries (713990).

14

(19) Automotive Repair and Maintenance including, but not limited to:

15

(i) General automotive repair (811111);

16

(ii) Automotive exhaust system repair (811112);

17

(iii) Automotive transmission repair (811113);

18

(iv) Other automotive mechanical and electrical repair and maintenance (811118);

19

(v) Automotive body, paint, and interior repair and maintenance (811121);

20

(vi) Automotive glass replacement shops (811122);

21

(vii) Automotive oil change and lubrication shops (811191); and

22

(viii) All other automotive repair and maintenance (811198).

23

(20) Electronic and precision equipment repair and maintenance including, but not

24

limited to:

25

(i) Consumer electronics repair and maintenance (811211);

26

(ii) Computer and office machine repair and maintenance (811212);

27

(iii) Communication equipment repair and maintenance (811213); and

28

(iv) Other electronic and precision equipment repair and maintenance (811219).

29

(21) Commercial and industrial machinery and equipment repair and maintenance

30 31 32

(811310). (22) Personal, furniture, and household goods repair and maintenance including, but not limited to:

33

(i) Home and garden equipment repair and maintenance (811411);

34

(ii) Appliance repair and maintenance (811412);

171


1

(iii) Reupholstery and furniture repair (811420);

2

(iv) Footwear and leather goods repair (811430); and

3

(v) Other personal and household goods repair and maintenance (811490).

4

(23) Personal care services including, but not limited to:

5

(i) Barber shops (812111);

6

(ii) Beauty salons (812112);

7

(iii) Nail salons (812113);

8

(iv) Diet and weight reducing centers (812191); and

9

(v) Other personal care services (812199) including but not limited to tattoo parlors and

10

body piercing establishments.

11

(24) Laundry and dry cleaning services, including, but not limited to:

12

(i) Coin-operated laundry and dry cleaning (812310);

13

(ii) Cry cleaning and laundry services (812320);

14

(iii) Linen supply garments, flatwork, and linens rental (812331); and

15

(iv) Industrial launderers (812332).

16

(25) Other personal services including, but not limited to:

17

(i) Pet care (812910) (except veterinary);

18

(ii) Photofinishing laboratories (812921);

19

(iii) One-hour photofinishing (812922);

20

(iv) Parking lots and garages (812930); and

21

(v) All other personal services (812990).

22

(26) Scenic and sightseeing transportation and support activities for transportation

23

including, but not limited to:

24

(i) Scenic and sightseeing transportation (Major Sector 487); and

25

(ii) Support activities for transportation (Major Sector 488).

26

(27) Couriers and messengers (Major Sector 492) including, but not limited to:

27

(i) Couriers and express delivery services (492110); and

28

(ii) Local messengers and local delivery (492210).

29

(28) Data processing, hosting and related services (518210).

30

(29) Performing arts companies and live entertainment services including, but not limited

31

to:

32

(i) Theater companies and dinner theaters (711110);

33

(ii) Dance companies (711120);

34

(iii) Musical groups and artists (711130);

172


1 2

(iv) Cover charges at drinking establishments (722410) or other music/entertainment establishments; and

3

(v) Other performing arts companies (711190).

4

(30) Spectator sports (except spectator sports involving primary and secondary

5

educational institutions and youth organizations) including, but not limited to:

6

(i) Sport teams and clubs (711211);

7

(ii) Racetracks (711212); and

8

(iii) Other spectator sports (711219).

9

(31) Cultural facilities and similar institutions including, but not limited to:

10

(i) Museums (712110);

11

(ii) Libraries (519120);

12

(iii) Historical sites (712120);

13

(iv) Zoos and botanical gardens (712130); and

14

(v) Nature parks and other simila r institutions (712190).

15

(32) Car washes (811192).

16

(33) Civic, social, professional, and similar organizations:

17

(i) Civic and social organizations (813410);

18

(ii) Business associations (813910);

19

(iii) Professional organizations (813920); and

20

(iv) Other similar organizations (813990).

21

(c) The tax administrator is authorized to promulgate rules and regulations to carry out

22

the provisions, policies, and purposes of this chapter including, but not limited to, emergency

23

rules and regulations pursuant to § 42-35-3(b).

24

44-18-7.4. Newspaper defined. -- "Newspaper" means an unbound publication printed

25

on newsprint, which contains news, editorial comment, opinions, features, advertising matter,

26

and/or other matters of public interest.

27 28 29 30

44-18-7.5. Specified digital products defined. -- “Specified digital products” includes electronically transferred: (1) “Digital audio-visual works” means a series of related images which, when shown in succession, impart an impression of motion, together with accompanying sounds;

31

(2) “Digital audio works” means works that result from the fixation of a series of musical,

32

spoken, or other sounds, including ringtones. For purposes of the definition of “digital audio

33

works”, “ringtones” means digitized sound files that are downloaded onto a device and that may

34

be used to alert the customer with respect to a communication.

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1 2

(3) “Digital books” means works that are generally recognized in the ordinary and usual sense as “books”.

3 4

SECTION 4. Section 44-18-12.2 of the General Laws in Chapter 44-18 entitled “Sales and Use Taxes – Liability and Computation” is hereby amended by adding the following:

5 6

44-18-12.2. Measures subject to 1% tax rate. -- (a) The following items will be subject to sales and use tax at the rate of one percent (1%):

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(1) Agricultural products for human consumption. The sale, storage, use or other

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consumption: (i) Of livestock and poultry, the kind of which ordinarily provide food for human

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consumption; and (ii) Of livestock, the products of which ordinarily constitute fibers for human

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use.

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(2) Air and water pollution control facilities. The sale, storage, use, or other consumption

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in this state of tangible personal property, specified digital property, services as defined in § 44-

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18-7.3, or supplies acquired for incorporation into or used and consumed in the operation of a

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facility, the primary purpose of which is to aid in the control of the pollution or contamination of

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the waters or air of the state, as defined in chapter 12 of title 46 and chapter 25 of title 23,

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respectively, and which has been certified as approved for that purpose by the director of

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environmental management. The director of environmental management may certify to a portion

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of the tangible personal property or supplies acquired for incorporation into those facilities or

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used and consumed in the operation of those facilities to the extent that that portion has as its

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primary purpose the control of the pollution or contamination of the waters or air of this state. As

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used in this subdivision, "facility" means any land, facility, device, building, machinery, or

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equipment.

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(3) Aircraft and aircraft parts. The sale, storage, use, or other consumption in this state of any new or used aircraft or aircraft parts.

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(4) Banks and Regulated investment companies interstate toll-free calls. The furnishing

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of interstate and international, toll-free terminating telecommunication service that is used

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directly and exclusively by or for the benefit of an eligible company as defined in this

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subdivision; provided, that an eligible company employs on average during the calendar year no

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less than five hundred (500) "full-time equivalent employees", as that term is defined in § 42-

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64.5-2. For purposes of this section, an "eligible company" means a "regulated investment

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company" as that term is defined in the Internal Revenue Code of 1986, 26 U.S.C. § 1 et seq., or a

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corporation to the extent the service is provided, directly or indirectly, to or on behalf of a

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regulated investment company, an employee benefit plan, a retirement plan or a pension plan or a

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state chartered bank.

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(5) Boats. The sale of a boat or vessel to a bona fide nonresident of this state who does

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not register the boat or vessel in this state, or document the boat or vessel with the United States

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government at a home port within the state, whether the sale or delivery of the boat or vessel is

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made in this state or elsewhere.

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(6) Boats or vessels brought into the state exclusively for winter storage, maintenance,

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repair or sale. For the period commencing on the first day of October in any year to and

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including the thirtieth (30th ) day of April next succeeding with respect to the use of any boat or

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vessel within this state exclusively for purposes of: (i) Delivery of the vessel to a facility in this

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state for storage, including dry storage and storage in water by means of apparatus preventing ice

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damage to the hull, maintenance, or repair; (ii) The actual process of storage, maintenance, or

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repair of the boat or vessel; or (iii) Storage for the purpose of selling the boat or vessel.

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(7) Boats or vessels generally. The sale, storage, use, or other consumption in this state of any new or used boat.

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(8) Charitable, educational, and religious organizations. (i) The sale to charitable,

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educational and religious organizations as defined in this section and the storage use and other

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consumption of tangible personal property, specified digital property, and/or services as defined

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in § 44-18-7.3. This shall also include hospitals not operated for profit, “educational institutions”

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as defined in § 44-18-30(17) not operated for a profit, churches, orphanages, and other

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institutions or organizations operated exclusively for religious or charitable purposes, interest free

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loan associations not operated for profit, nonprof it organized sporting leagues and associations

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and bands for boys and girls under the age of nineteen (19) years, the following vocational

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student organizations that are state chapters of national vocational students organizations:

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Distributive Education Clubs of America, (DECA); Future Business Leaders of America, phi beta

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lambda (FBLA/PBL); Future Farmers of America (FFA); Future Homemakers of America/Home

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

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(VICA), organized nonprofit golden age and senior citizens clubs for men and women, and parent

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teacher associations. Sales made to the United States government, this state and its political

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subdivisions are exempt from this section.

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(ii) In the case of contract entered into with any agency, institution, or organization as

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described in subsection (i), the contractor shall charge the one percent (1%) sales or use tax and

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shall in that instance provide his or her suppliers with certificates in the form as determined by

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the division of taxation showing the reason for the one percent (1%) exemption; and the

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contractor's records must substantiate the claim for exemption by showing the disposition of all

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

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pay the tax on the property used.

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(9) Clothing and footwear. The sales of articles of clothing, including footwear, intended

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to be worn or carried on or about the human body. For the purposes of this section, "clothing or

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footwear" does not include clothing accessories or equipment or special clothing or footwear

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primarily designed for athletic activity or protective use as these terms are defined in ยง 44-18-

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7.1(f).

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(10) Coffins, caskets, and burial garments. The sale, storage, use, or other consumption

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in this state of coffins or caskets, and shrouds or other burial garments which are ordinarily sold

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by a funeral director as part of the business of funeral directing.

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(11) Coins. The sale, storage, use, or other consumption in this state of coins having numismatic or investment value.

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(12) Commercial fishing vessels. From the sale and storage, use, or other consumption in

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this state of vessels and other watercraft which are in excess of five (5) net tons and which are

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used exclusively for "commercial fishing", as defined in this subdivision, and the repair,

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alteration, or conversion of those vessels and other watercraft, and the sale of property purchased

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for the use of those vessels and other watercraft including provisions, supplies, and material for

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the maintenance and/or repair of the vessels and other watercraft and the boats nets, cables,

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tackle, and other fishing equipment appurtenant to or used in connection with the commercial

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fishing of the vessels and other watercraft.

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(13) Commercial vessels. Sales made to a commercial ship, barge, or other vessel of fifty

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(50) tons burden or over, primarily engaged in interstate or foreign commerce, and from the

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repair, alteration, or conversion of the vessels, and from the sale of property purchased for the use

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of the vessels including provisions, supplies, and material for the maintenance and/or repair of the

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vessels.

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(14) Compressed air. The sale, storage, use, or other consumption in the state of compressed air.

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(15) Containers.

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(i) The sale, storage, use, or other consumption in this state of:

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

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

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

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the contents with the container.

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(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.

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(C) Returnable containers when sold with the contents in connection with a retail sale of the contents or when resold for refilling.

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

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

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returnable containers."

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(16) Economic development corporation project status designees as described in ยง 42-

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64-20. Sales to economic development corporation project status designees as described in ยง 42-

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64-20.

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(17) Educational institutions. The rental charged by any educational institution for living

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quarters, or sleeping or housekeeping accommodations or other rooms or accommodations to any

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

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

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

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

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school year, which keeps and furnishes to students and others records required and accepted for

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

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inures to the benefit of any individual.

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(18) Equipment used for research and development. The sale, storage, use, or other

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consumption of equipment and the repair and maintenance of equipment to the extent used for

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research and development purposes by a qualifying firm. For the purposes of this subdivision,

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"qualifying firm" means a business for which the use of research and development equipment is

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an integral part of its operation, and "equipment" means scientific equipment, computers,

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software, and related items.

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(19) Farm equipment. The sale, storage or use of machinery and equipment used directly

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for commercial farming and agricultural production; including, but not limited to, tractors,

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ploughs, harrows, spreaders, seeders, milking machines, silage conveyors, balers, bulk milk

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storage tanks, trucks with farm plates, mowers, combines, irrigation equipment, greenhouses and

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greenhouse coverings, graders and packaging machines, tools and supplies and other farming

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equipment, including replacement parts, appurtenant to or used in connection with commercial

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farming and tools and supplies used in the repair and maintenance of farming equipment.

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(20) Farm structure construction materials. The sale, storage, use, or other consumption

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of lumber, hardware and other materials used in the new construction of farm structures,

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including production facilities such as, but not limited to, farrowing sheds, free stall and

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stanchion barns, milking parlors, silos, poultry barns, laying houses, fruit and vegetable storages,

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rooting cellars, propagation rooms, greenhouses, packing rooms, machinery storage, seasonal

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farm worker housing, certified farm markets, bunker and trench silos, feed storage sheds, and any

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other structures used in connection with commercial farming.

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(21) Flags. The sale, storage, consumption, or other use in this state of United States, Rhode Island or POW-MIA flags. (22) Heating fuels. The sale, storage, use, or other consumption in this state of every type of fuel used in the heating of homes and residential premises. (23) Horse food products. The sale, 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. (24) Industrial facilities corporation lessees as described in ยง 45-37.1-9.

Sales to

industrial facilities corporation lessees as described in ยง 45-37.1-9.

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(25) Manufacturing machinery and equipment.

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(i) The sale, storage, use, or other consumption in this state of tools, dies, and molds, and

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machinery and equipment (including replacement parts), and related items, specified digital

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property and services as defined in ยง 44-18-7.3, to the extent used in an industrial plant in

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connection with the actual manufacture, conversion, or processing of tangible personal property,

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or to the extent used in connection with the actual manufacture, conversion or processing of

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computer software as that term is utilized in industry numbers 7371, 7372, and 7373 in the

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standard industrial classification manual prepared by the technical committee on industrial

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classification, office of statistical standards, executive office of the president, United States

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bureau of the budget, as revised from time to time, to be sold, or that machinery and equipment

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used in the furnishing of power to an industrial manufacturing plant. For the purposes of this

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subdivision, "industrial plant" means a factory at a fixed location primarily engaged in the

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manufacture, conversion, or processing of tangible personal property to be sold in the regular

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course of business;

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(ii) Machinery and equipment and related items are not deemed to be used in connection

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with the actual manufacture, conversion, or processing of tangible personal property, or in

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connection with the actual manufacture, conversion or processing of computer software as that

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term is utilized in industry numbers 7371, 7372, and 7373 in the standard industrial classification

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manual prepared by the technical committee on industrial classification, offic e of statistical

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standards, executive office of the president, United States bureau of the budget, as revised from

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time to time, to be sold to the extent the property is used in administration or distribution

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operations;

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(iii) Machinery and equipment and related items used in connection with the actual

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manufacture, conversion, or processing of any computer software or any tangible personal

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property which is not to be sold and which would be exempt under or this subdivision if

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purchased from a vendor or machinery and equipment and related items used during any

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manufacturing, converting or processing function is exempt under this subdivision even if that

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operation, function, or purpose is not an integral or essential part of a continuous production flow

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or manufacturing process.

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(26) Precious metal bullion. (i) The sale, storage, use, or other consumption in this state of precious metal bullion, substantially equivalent to a transaction in securities or commodities.

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(ii) For purposes of this subdivision, "precious metal bullion" means any elementary

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precious metal which has been put through a process of smelting or refining, including, but not

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limited to, gold, silver, platinum, rhodium, and chromium, and which is in a state or condition

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that its value depends upon its content and not upon its form.

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(iii) The term does not include fabricated precious metal which has been processed or

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

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uses.

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(27) Purchase for manufacturing purposes.

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(i) The sale and storage, use, or other consumption in this state of computer software,

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tangible personal property, specified digital property, services as defined in ยง 44-18-7.3,

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electricity, natural gas, artificial gas, steam, refrigeration, and water, when the property or service

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is purchased for the purpose of being manufactured into a finished product for resale, and

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becomes an ingredient, component, or integral part of the manufactured, compounded, processed,

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assembled, or prepared product, or if the property or service is consumed in the process of

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manufacturing for resale computer software, tangible personal property, electricity, natural gas,

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artificial gas, steam, refrigeration, or water.

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(28) Trade-in value of motor vehicles. The sale, storage, use, or other consumption in this

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state of so much of the purchase price paid for a new or used automobile as is allocated for a

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trade-in allowance on the automobile of the buyer given in trade to the seller or of the proceeds

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applicable only to the automobile as are received from the manufacturer of automobiles for the

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repurchase of the automobile whether the repurchase was voluntary or not towards the purchase

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of a new or used automobile by the buyer. For the purpose of this subdivision, the word

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"automobile" means a private passenger automobile not used for hire and does not refer to any

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other type of motor vehicle.

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(29) Manufacturing business reconstruction materials.

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(i) The sale, storage, use or other consumption in this state of lumber, hardware, and

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other building materials used in the reconstruction of a manufacturing business facility which

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suffers a disaster in this state. For the purposes of this section, "Disaster" means any occurrence,

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natural or otherwise, which results in the destruction of sixty percent (60%) or more of an

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operating manufacturing business facility within this state. "Disaster" does not include any

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damage resulting from the willful act of the owner of the manufacturing business facility.

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(ii) Manufacturing business facility includes, but is not limited to, the structures housing the production and administrative facilities.

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(iii) In the event a manufacturer has more than one manufacturing site in this state, the

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sixty percent (60%) provision in subsection (28)(i) above applies to the damages suffered at that

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one site.

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(30) Promotional and product literature of boat manufacturers. The sale, storage, use, or

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other consumption of promotional and product literature of boat manufacturers which are mailed

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to customers at no charge.

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(31) Renewable energy products. The sale, storage use, or other consumption in this state

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of solar photovoltaic modules or panels, or any module or panel that generates electricity from

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light; solar thermal collectors, including, but not limited to, those manufactured with flat glass

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plates, extruded plastic, sheet metal, and/or evacuated tubes; geothermal heat pumps, including

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both water-to-water and water-to-air type pumps; wind turbines; towers used to mount wind

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turbines if specified by or sold by a wind turbine manufacturer; DC to AC inverters that

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interconnect with utility power lines; manufactured mounting racks and ballast pans for solar

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collector, module or panel installation, provided this section shall not include materials that could

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be fabricated into such racks; monitoring and control equipment, if specified or supplied by a

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manufacturer of solar thermal, solar photovoltaic, geothermal, or wind energy systems or if

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required by law or regulation for such systems but not to include pumps, fans or plumbing or

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electrical fixtures unless shipped from the manufacturer affixed to, or an integral part of, another

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item specified on this list; and solar storage tanks that are part of a solar domestic hot water

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system or a solar space heating system.

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(32) Sales tax for sales by writers, composers, artists as described in ยง 44-18-30B. The sales by writers, composers, and artists defined in ยง 44-18-30B.

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(33) Sales and use taxes for municipal economic development zones as described in ยง 44-

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18-30C. Sales by retailers located in a municipal economic development zone as described in ยง

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44-18-30C.

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(34) Tangible personal property and supplies used in the processing or preparation of

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floral products and floral arrangements. The sale, storage, use, or other consumption in this state

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of tangible personal property or supplies purchased by florists, garden centers, or other like

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producers or vendors of flowers, plants, floral products, and natural and artificial floral

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arrangements which are ult imately sold with flowers, plants, floral products, and natural and

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artificial floral arrangements or are otherwise used in the decoration, fabrication, creation,

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processing, or preparation of flowers, plants, floral products, or natural and artificial floral

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arrangements, including descriptive labels, stickers, and cards affixed to the flower, plant, floral

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product or arrangement, artificial flowers, spray materials, floral paint and tint, plant shine, flower

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food, insecticide and fertilizers.

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(35) Tangib le personal property and supplies used in on-site hazardous waste recycling,

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reuse, or treatment. The sale, storage, use, or other consumption in this state of tangible personal

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property or supplies, repair and maintenance, specified digital products, and services as defined in

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ยง 44-18-7.3 used or consumed in the operation of equipment, the exclusive function of which is

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the recycling, reuse, or recovery of materials (other than precious metals, as defined in

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subdivision (24)(ii) of this section) from the treatment of "hazardous wastes", as defined in ยง 23-

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19.1-4, where the "hazardous wastes" are generated in Rhode Island solely by the same taxpayer

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and where the personal property is located at, in, or adjacent to a generating facility of the

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taxpayer in Rhode Island and services as defined in ยง 44-18-7.3 are provided and repair and

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maintenance are delivered. The taxpayer shall procure an order from the director of the

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department of environmental management certifying that the equipment and/or supplies as used,

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or consumed, qualify for the exemption under this subdivision.

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(36) Textbooks. The sale and from the storage, use, or other consumption in this state of

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textbooks by an "educational institution" as defined in subdivision (16) of this section and as well

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as any educational institution within the purview of ยง 16-63-9(4) and used textbooks by any

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purveyor.

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(37) Transfers or sales made to immediate family members, and dissolutions and partial

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liquidations of a business entity. The storage, use, or other consumption in this state of a motor

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vehicle, a boat, an airplane, or a trailer purchased from other than a licensed motor vehicle dealer

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or other than a retailer of boats, airplanes, or trailers; provided, however; (i) The transferee or

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purchaser is the spouse, mother, father, brother, sister, or child of the transferor or seller; or (ii)

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The transfer or sale is made in connection with the dissolution, or partial liquidation of a business

31

entity.

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(38) Water for residential use. The sale and from the storage, use, or other consumption in this state of water furnished for domestic use by occupants of residential premises. (b) The tax administrator is authorized to promulgate rules and regulations to carry out

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the provisions, policies, and purposes of this chapter including, but not limited to, emergency

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rules and regulations pursuant to § 42-35-3(b).

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(c) In recognition of the work being performed by the Streamlined Sales and Use Tax

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Governing Board, the provisions of 44-18-12.2 shall sunset as of the effective date of any federal

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law which requires remote sellers to collect and remit taxes assessed on sales to this state's

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residents.

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SECTION 5. Sections 44-18-8, 44-18-12, 44-18-15, 44-18-18, 44-18-18.1, 44-18-20, 44-

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18-21, 44-18-22, 44-18-23, 44-18-25, 44-18-30, 44-18-36.1, 44-18-40.1, of the General Laws in

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Chapter 44-18 entitled “Sales and Use Taxes – Liability and Computation” are hereby amended

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to read as follows:

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44-18-8. Retail sale or sale at retail defined. -- A "retail sale" or "sale at retail" means

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any sale, lease or rentals of tangible personal property, specified digital products, and/or services

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as defined in § 44-18-7.3 for any purpose other than resale, sublease or subrent in the regular

14

course of business. The sale of tangible personal property to be used for purposes of rental in the

15

regular course of business is considered to be a sale for resale. In regard to telecommunications

16

service as defined in § 44-18-7(9), retail sale does not include the purchase of

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telecommunications service by a tele communications provider from another telecommunication

18

provider for resale to the ultimate consumer; provided, that the purchaser submits to the seller a

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certificate attesting to the applicability of this exclusion, upon receipt of which the seller is

20

relieved of any tax liability for the sale.

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44-18-12. "Sale price" defined. -- (a) "Sales price" applies to the measure subject to

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sales tax and means the total amount of consideration, including cash, credit, property, and

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services, for which personal property or services are sold, leased, or rented, valued in money,

24

whether received in money or otherwise, without any deduction for the following:

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(i) The seller's cost of the property sold;

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(ii) The cost of materials used, labor or service cost, interest, losses, all costs of

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transportation to the seller, all taxes imposed on the seller, and any other expense of the seller; (iii) Charges by the seller for any services necessary to complete the sale, other than delivery and installation charges;

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(iv) Delivery charges, as defined in § 44-18-7.1(i); or

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(v) Credit for any trade-in, as determined by state law. ; or

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(vi) The amount charged for labor or services rendered in installing or applying the

33 34

property sold. (b) "Sales price" shall not include:

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(i) Discounts, including cash, term, or coupons that are not reimbursed by a third party that are allowed by a seller and taken by a purchaser on a sale;

3

(ii) The amount charged for labor or services rendered in installing or applying the

4

property sold when the charge is separately stated by the retailer to the purchaser; provided that in

5

transactions subject to the provisions of this chapter the retailer shall separately state such charge

6

when requested by the purchaser and, further, the failure to separately state such charge when

7

requested may be restrained in the same manner as other unlawful acts or practices prescribed in

8

chapter 13.1 of title 6.

9

(iii) (ii) Interest, financing, and carrying charges from credit extended on the sale of

10

personal property or services, if the amount is separately stated on the invoice, bill of sale or

11

similar document given to the purchaser; and

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(iv) (iii) Any taxes legally imposed directly on the consumer that are separately stated on the invoice, bill of sale or similar document given to the purchaser.

14

(v) (iv) Manufacturer rebates allowed on the sale of motor vehicles.

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(c) "Sales price" shall include consideration received by the seller from third parties if:

16

(i) The seller actually receives consideration from a party other than the purchaser and the

17 18 19 20 21

consideration is directly related to a price reduction or discount on the sale; (ii) The seller has an obligation to pass the price reduction or discount through to the purchaser; (iii) The amount of the consideration attributable to the sale is fixed and determinable by the seller at the time of the sale of the item to the purchaser; and

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(iv) One of the following criteria is met:

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(A) The purchaser presents a coupon, certificate or other documentation to the seller to

24

claim a pric e reduction or discount where the coupon, certificate or documentation is authorized,

25

distributed or granted by a third party with the understanding that the third party will reimburse

26

any seller to whom the coupon, certificate or documentation is presented;

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(B) The purchaser identifies himself or herself to the seller as a member of a group or

28

organization entitled to a price reduction or discount (a "preferred customer" card that is available

29

to any patron does not constitute membership in such a group), or

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(C) The price reduction or discount is identified as a third party price reduction or

31

discount on the invoice received by the purchaser or on a coupon, certificate or other

32

documentation presented by the purchaser.

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44-18-15. "Retailer" defined. -- (a) "Retailer" includes:

34

(1) Every person engaged in the business of making sales at retail, specified digital

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products, and/or providing services as defined in ยง 44-18-7.3, including sales at auction of

2

tangible personal property owned by the person or others.

3

(2) Every person making sales of tangible personal property, specified digital products,

4

and/or providing services as defined in ยง 44-18-7.3, through an independent contractor or other

5

representative, if the retailer enters into an agreement with a resident of this state, under which the

6

resident, for a commission or other consideration, directly or indirectly refers potential customers,

7

whether by a link on an Internet website or otherwise, to the retailer, provided the cumulative

8

gross receipts from sales by the retailer to customers in the state who are referred to the retailer by

9

all residents with this type of an agreement with the retailer, is in excess of five thousand dollars

10

($5,000) during the preceding four (4) quarterly periods ending on the last day of March, June,

11

September and December. Such retailer shall be presumed to be soliciting business through such

12

independent contractor or other representative, which presumption may be rebutted by proof that

13

the resident with whom the retailer has an agreement did not engage in any solicitation in the

14

state on behalf of the retailer that would satisfy the nexus requirement of the United States

15

Constitution during such four (4) quarterly periods.

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(3) Every person engaged in the business of making sales for storage, use, or other

17

consumption, or the business of making sales at auction of tangible personal property, specified

18

digital products and/or providing services as defined in ยง 44-18-7.3 owned by the person or

19

others for storage, use, or other consumption.

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(4) A person conducting a horse race meeting with respect to horses, which are claimed during the meeting. (5) Every person engaged in the business of renting any living quarters in any hotel, rooming house, or tourist camp.

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(6) Every person maintaining a business within or outside of this state who engages in the

25

regular or systematic solicitation of sales of tangible personal property, specified digital products

26

and/or services as defined in ยง 44-18-7.3, in this state by means of:

27

(i) Advertising in newspapers, magazines, and other periodicals published in this state,

28

sold over the counter in this state or sold by subscription to residents of this state, billboards

29

located in this state, airborne advertising messages produced or transported in the airspace above

30

this state, display cards and posters on common carriers or any other means of public conveyance

31

incorporated or operated primarily in this state, brochures, catalogs, circulars, coupons,

32

pamphlets, samples, and similar advertising material mailed to, or distributed within this state to

33

residents of this state;

34

(ii) Telephone;

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1

(iii) Computer assisted shopping networks; and

2

(iv) Television, radio or any other electronic media, which is intended to be broadcast to

3

consumers located in this state.

4

(b) When the tax administrator determines that it is necessary for the proper

5

administration of chapters 18 and 19 of this title to regard any salespersons, representatives,

6

truckers, peddlers, or canvassers as the agents of the dealers, distributors, supervisors, employers,

7

or persons under whom they operate or from whom they obtain the tangible personal property

8

sold by them, irrespective of whether they are making sales on their own behalf or on behalf of

9

the dealers, distributors, supervisors, or employers, the tax administrator may so regard them and

10

may regard the dealers, distributors, supervisors, or employers as retailers for purposes of

11

chapters 18 and 19 of this title.

12

44-18-18. Sales tax imposed. -- A tax is imposed upon sales at retail in this state

13

including charges for rentals of living quarters in hotels, rooming houses, or tourist camps, at the

14

rate of six percent (6%) of the gross receipts of the retailer from the sales or rental charges;

15

provided, that the tax imposed on charges for the rentals applies only to the first period of not

16

exceeding thirty (30) consecutive calendar days of each rental; provided, further however, that:

17

(i) for For the period commencing July 1, 1990, the tax rate is seven percent (7%); and

18

(ii) For the period commencing July 1, 2011, the tax rate is six percent (6%) which

19

includes services as enumerated in ยง 44-18-7.3; provided, however, the tax rate is one percent

20

(1%) for items as enumerated in ยง 44-18-12.2. The tax is paid to the tax administrator by the

21

retailer at the time and in the manner provided. Excluded from this tax are those living quarters in

22

hotels, rooming houses, or tourist camps for which the occupant has a written lease for the living

23

quarters which lease covers a rental period of twelve (12) months or more.

24

44-18-18.1. Local meals and beverage tax. -- (a) There is hereby levied and imposed,

25

upon every purchaser of a meal and/or beverage, in addition to all other taxes and fees now

26

imposed by law, a local meals and beverage tax upon each and every meal and/or beverage sold

27

within the state of Rhode Island in or from an eating and/or drinking establishment, whether

28

prepared in the eating and/or drinking establishment or not and whether consumed at the premises

29

or not, at a rate of one percent of the gross receipts; provided, further, that for the period

30

commencing July 1, 2011, the rate is two percent (2%) of gross receipts. The tax shall be paid to

31

the tax administrator by the retailer at the time and in the manner provided.

32

(b) All sums received by the division of taxation for sales prior to July 1, 2011 under this

33

section as taxes, penalties or forfeitures, interest, costs of suit and fines shall be distributed at

34

least quarterly, credited and paid by the state treasurer to the city or town where the meals and

185


1

beverages are delivered.

2

(c) For sales on or after July 1, 2011, one percent (1%) of the two percent (2%) of the

3

gross receipts paid under ยง 44-18-18.1(a) received by the division of taxation as taxes, penalties

4

or forfeitures, interest, costs of suit and fines shall be distributed at least quarterly, credited and

5

paid by the state treasurer to the city or town where the meals and beverages are delivered. The

6

remaining one percent (1%) of the total received by the division of taxation under ยง 44-18-18.1(a)

7

as taxes, penalties or forfeitures, interest, costs of suit and fines shall be deposited in the

8

Municipal Accountability Stability and Transparency Fund and shall be distributed pursuant to

9

ยง45-13.2.

10

(c) (d) When used in this section, the following words have the following meanings:

11

(1) "Beverage" means all nonalcoholic beverages, as well as alcoholic beverages, beer,

12

lager beer, ale, porter, wine, similar fermented malt or vinous liquor.

13

(2) "Eating and/or drinking establishments" mean and include restaurants, bars, taverns,

14

lounges, cafeterias, lunch counters, drive-ins, roadside ice cream and refreshment stands, fish and

15

chip places, fried chicken places, pizzerias, food and drink concessions, or similar facilities in

16

amusement parks, bowling alleys, clubs, caterers, drive-in theatres, industrial plants, race tracks,

17

shore resorts or other locations, lunch carts, mobile canteens and other similar vehicles, and other

18

like places of business which furnish or provide facilities for immediate consumption of food at

19

tables, chairs or counters or from trays, plates, cups or other tableware or in parking facilities

20

provided primarily for the use of patrons in consuming products purchased at the location.

21

Ordinarily, eating establishments do not mean and include food stores and supermarkets. Eating

22

establishments do not mean "vending machines," a self-contained automatic device that dispenses

23

for sale foods, beverages, or confection products. Retailers selling prepared foods in bulk either in

24

customer-furnished containers or in the seller's containers, for example "Soup and Sauce"

25

establishments, are deemed to be selling prepared foods ordinarily for immediate consumption

26

and, as such, are considered eating establishments.

27

(3) "Meal" means any prepared food or beverage offered or held out for sale by an eating

28

and/or drinking establishment for the purpose of being consumed by any person to satisfy the

29

appetite and which is ready for immediate consumption. All such food and beverage, unless

30

otherwise specifically exempted or excluded herein shall be included, whether intended to be

31

consumed on the seller's premises or elsewhere, whether designated as breakfast, lunch, snack,

32

dinner, supper or by some other name, and without regard to the manner, time or place of service.

33

(d) (e) This local meals and beverage tax shall be administered and collected by the

34

division of taxation and unless provided to the contrary in this chapter, all of the administration,

186


1

collection, and other provisions of chapters 18 and 19 of this article apply.

2

44-18-20. Use tax imposed. -- (a) An excise tax is imposed on the storage, use, or other

3

consumption in this state of tangible personal property, including a motor vehicle, a boat, an

4

airplane, or a trailer, purchased from any retailer at the rate of six percent (6%) of the sale price of

5

the property.

6

(b) An excise tax is imposed on the storage, use, or other consumption in this state of a

7

motor vehicle, a boat, an airplane, or a trailer purchased from other than a licensed motor vehicle

8

dealer or other than a retailer of boats, airplanes, or trailers respectively, at the rate of six percent

9

(6%) of the sale price of the motor vehicle, boat, airplane, or trailer.

10

(c) The word "trailer" as used in this section and in § 44-18-21 means and includes those

11

defined in § 31-1-5(a) – (e) and also includes boat trailers, camping trailers, house trailers, and

12

mobile homes.

13

(d) Notwithstanding the provisions contained in this section and in § 44-18-21 relating to

14

the imposition of a use tax and liability for this tax on certain casual sales, no tax is payable in

15

any casual sale:

16 17

(1) Except as otherwise provided in § 44-18-12.2, W when when the transferee or purchaser is the spouse, mother, father, brother, sister, or child of the transferor or seller; or

18

(2) Except as otherwise provided in § 44-18-12.2, W when when the transfer or sale is

19

made in connection with the organization, reorganization, dissolution, or partial liquidation of a

20

business entity provided:

21 22 23 24 25 26

(i) The last taxable sale, transfer, or use of the article being transferred or sold was subjected to a tax imposed by this chapter; (ii) The transferee is the business entity referred to or is a stockholder, owner, member, or partner; and (iii) Any gain or loss to the transferor is not recognized for income tax purposes under the provisions of the federal income tax law and treasury regulations and rulings issued thereunder;

27

(3) When the sale or transfer is of a trailer, other than a camping trailer, of the type

28

ordinarily used for residential purposes and commonly known as a house trailer or as a mobile

29

home; or

30 31

(4) When the transferee or purchaser is exempt under the provisions of § 44-18-30 or other general law of this state or special act of the general assembly of this state.

32

(e) The term "casual" means a sale made by a person other than a retailer; provided, that

33

in the case of a sale of a motor vehicle, the term means a sale made by a person other than a

34

licensed motor vehicle dealer or an auctioneer at an auction sale. In no case is the tax imposed

187


1

under the provisions of subsections (a) and (b) of this section on the storage, use, or other

2

consumption in this state of a used motor vehicle less than the product obtained by multiplying

3

the amount of the retail dollar value at the time of purchase of the motor vehicle by the applicable

4

tax rate; provided, that where the amount of the sale price exceeds the amount of the retail dollar

5

value, the tax is based on the sale price. The tax administrator shall use as his or her guide the

6

retail dollar value as shown in the current issue of any nationally recognized used vehicle guide

7

for appraisal purposes in this state. On request within thirty (30) days by the taxpayer after

8

payment of the tax, if the tax administrator determines that the retail dollar value as stated in this

9

subsection is inequitable or unreasonable, he or she shall, after affording the taxpayer reasonable

10

opportunity to be heard, re-determine the tax.

11

(f) Every person making more than five (5) retail sales of tangible personal property

12

during any twelve (12) month period, including sales made in the capacity of assignee for the

13

benefit of creditors or receiver or trustee in bankruptcy, is considered a retailer within the

14

provisions of this chapter.

15

(g) "Casual sale" includes a sale of tangible personal property not held or used by a seller

16

in the course of activities for which the seller is required to hold a seller's permit or permits or

17

would be required to hold a seller's permit or permits if the activities were conducted in this state;

18

provided, that the sale is not one of a series of sales sufficient in number, scope, and character

19

(more than five (5) in any twelve (12) month period) to constitute an activity for which the seller

20

is required to hold a seller's permit or would be required to hold a seller's permit if the activity

21

were conducted in this state.

22

(2) Casual sales also include sales made at bazaars, fairs, picnics, or similar events by

23

nonprofit organizations, which are organized for charitable, educational, civic, religious, social,

24

recreational, fraternal, or literary purposes during two (2) events not to exceed a total of six (6)

25

days duration each calendar year. Each event requires the issuance of a permit by the division of

26

taxation. Where sales are made at events by a vendor, which holds a sales tax permit and is not a

27

nonprofit organization, the sales are in the regular course of business and are not exempt as casual

28

sales.

29 30

(h) The use tax imposed under this section for the period commencing July 1, 1990 is at the rate of seven percent (7%).; provided, however, that:

31

(i) for For the period commencing July 1, 1990, the tax rate is seven percent (7%); and

32

(ii) For the period commencing July 1, 2011, the tax rate is six percent (6%) which

33

includes services as enumerated in ยง 44-18-7.3; provided, however, the tax rate is one percent

34

(1%) for items as enumerated in ยง 44-18-12.2.

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1

44-18-21. Liability for use tax. -- (a) Every person storing, using, or consuming in this

2

state tangible personal property, including a motor vehicle, boat, airplane, or trailer, purchased

3

from a retailer, and a motor vehicle, boat, airplane, or trailer, purchased from other than a

4

licensed motor vehicle dealer or other than a retailer of boats, airplanes, or trailers respectively , ;

5

or storing, using or consuming specified digital products, and/or services as defined in § 44-18-

6

7.3 is liable for the use tax. The person's liability is not extinguished until the tax has been paid to

7

this state, except that a receipt from a retailer engaging in business in this state or from a retailer

8

who is authorized by the tax administrator to collect the tax under rules and regulations that he or

9

she may prescribe, given to the purchaser pursuant to the provisions of § 44-18-22, is sufficient to

10

relieve the purchaser from further liability for the tax to which the receipt refers.

11

(b) Each person before obtaining an original or transferral registration for any article or

12

commodity in this state, which article or commodity is required to be licensed or registered in the

13

state, shall furnish satisfactory evidence to the tax administrator that any tax due under this

14

chapter with reference to the article or commodity has been paid, and for the purpose of effecting

15

compliance, the tax administrator, in addition to any other powers granted to him or her, may

16

invoke the provisions of § 31-3-4 in the case of a motor vehicle. The tax administrator, when he

17

or she deems it to be for the convenience of the general public, may authorize any agency of the

18

state concerned with the licensing or registering of these articles or commodities to collect the use

19

tax on any articles or commodities which the purchaser is required by this chapter to pay before

20

receiving an original or transferral registration. The general assembly shall annually appropriate a

21

sum that it deems necessary to carry out the purposes of this section. Notwithstanding the

22

provisions of §§ 44-18-19, 44-18-22, and 44-18-24, the sales or use tax on any motor vehicle

23

and/or recreational vehicle requiring registration by the administrator of the division of motor

24

vehicles shall not be added by the retailer to the sale price or charge but shall be paid directly by

25

the purchaser to the tax administrator, or his or her authorized deputy or agent as provided in this

26

section.

27

(c) In cases involving total loss or destruction of a motor vehicle occurring within one

28

hundred twenty (120) days from the date of purchase and upon which the purchaser has paid the

29

use tax, the amount of the tax constitutes an overpayment. The amount of the overpayment may

30

be credited against the amount of use tax on any subsequent vehicle which the owner acquires to

31

replace the lost or destroyed vehicle or may be refunded, in whole or in part.

32

44-18-22. Collection of use tax by retailer. -- Every retailer engaging in business in this

33

state and making sales of tangible personal property or specified digital products for storage, use,

34

or other consumption in this state, and/or providing services as defined in § 44-18-7.3, not

189


1

exempted under this chapter shall, at the time of making the sales, or if the storage, use, or other

2

consumption of the tangible personal property, specified digital products, and/or providing

3

services as defined in § 44-18-7.3, is not then taxable under this chapter, at the time the storage,

4

use, or other consumption or for providing services becomes taxable, collect the tax from the

5

purchaser and give to the purchaser a receipt in the manner and form prescribed by the tax

6

administrator.

7

44-18-23. "Engaging in business" defined. -- As used in §§ 44-18-21 and 44-18-22 the

8

term "engaging in business in this state" means the selling or delivering in this state, or any

9

activity in this state related to the selling or delivering in this state of tangible personal property

10

or specified digital products for storage, use, or other consumption in this state, as well as

11

providing services in this state as defined in § 44-18-7.3. This term includes, but is not limited to,

12

the following acts or methods of transacting business:

13

(1) Maintaining, occupying, or using in this state permanently or temporarily, directly or

14

indirectly or through a subsidiary, representative, or agent by whatever name called and whether

15

or not qualified to do business in this state, any office, place of distribution, sales or sample room

16

or place, warehouse or storage place, or other place of business;

17

(2) Having any subsidiary, representative, agent, salesperson, canvasser, or solicitor

18

permanently or temporarily, and whether or not the subsidiary, representative, or agent is

19

qualified to do business in this state, operate in this state for the purpose of selling, delivering, or

20

the taking of orders for any tangible personal property, specified digital products, and/or services

21

as defined in § 44-18-7.3;

22 23

(3) The regular or systematic solicitation of sales of tangible personal property, specified digital products, and/or services as defined in § 44-18-7.3, in this state by means of:

24

(i) Advertising in newspapers, magazines, and other periodicals published in this state,

25

sold over the counter in this state or sold by subscription to residents of this state, billboards

26

located in this state, airborne advertising messages produced or transported in the air space above

27

this state, display cards and posters on common carriers or any other means of public conveyance

28

incorporated or operating primarily in this state, brochures, catalogs, circulars, coupons,

29

pamphlets, samples, and similar advertising material mailed to, or distributed within this state to

30

residents of this state;

31

(ii) Telephone;

32

(iii) Computer-assisted shopping networks; and

33

(iv) Television, radio or any other electronic media, which is intended to be broadcast to

34

consumers located in this state.

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1

44-18-25. Presumption that sale is for storage, use, or consumption – Resale

2

certificate. -- It is presumed that all gross receipts are subject to the sales tax, and that the use of

3

all tangible personal property, specified digital products and/or services provided as defined in §

4

44-18-7.3 are is subject to the use tax, and that all tangible personal property, specified digital

5

products and/or services provided as defined in § 44-18-7.3 sold or in processing or intended for

6

delivery or delivered in this state is sold or delivered for storage, use, or other consumption in this

7

state, until the contrary is established to the satisfaction of the tax administrator. The burden of

8

proving the contrary is upon the person who makes the sale and the purchaser, unless the person

9

who makes the sale takes from the purchaser a certificate to the effect that the purchase was for

10

resale. The certificate shall contain any information and be in the form that the tax administrator

11

may require.

12 13

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:

14 15

Except as provided in § 44-18-12.2, the following gross receipts are exempted from the six percent (6%) tax imposed by this chapter:

16

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

17

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

18

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

19

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

20

(2) Newspapers.

21

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

22

newspaper.

23

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

24

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

25

interest.

26

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

27

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

28

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

29

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

30

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

31

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

32

food service or management entity under contract to the educational institutions.

33

(4)(3) Containers.

34

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

191


1

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

2

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

3

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

4

the contents with the container.

5 6 7 8

(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. (C) Returnable containers when sold with the contents in connection with a retail sale of the contents or when resold for refilling.

9

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

10

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

11

returnable containers."

12

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

13

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

14

state of the United States of America of tangible personal property by hospitals not operated for a

15

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

16

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

17

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

18

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

19

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

20

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

21

America, phi beta lambda (FBLA/PBL); Future Farmers of America (FFA); Future Homemakers

22

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

23

Clubs of America (VICA), organized nonprofit golden age and senior citizens clubs for men and

24

women, and parent teacher associations.

25

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

26

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

27

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

28

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

29

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

30

purchase such materials and supplies (materials and/or supplies are defined as those which are

31

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

32

under the contracts without payment of the tax.

33

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

34

institution, or organization but shall in that instance provide his or her suppliers with certificates

192


1

in the form as determined by the division of taxation showing the reason for exemption; and the

2

contractor's records must substantiate the claim for exemption by showing the disposition of all

3

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

4

pay the tax on the property used.

5

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

6

state of: (i) gasoline and other products taxed under chapter 36 of title 31, and (ii) fuels used for

7

the propulsion of airplanes.

8

(7)(6) Purchase for manufacturing purposes.

9

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

10

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

11

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

12

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

13

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

14

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

15

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

16 17

(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.

18

(iii) "Consumed" includes mere obsolescence.

19

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

20

assembling, preparing, or producing.

21

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

22

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

23

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

24

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

25

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

26

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

27

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

28

distribution operations which occur subsequent to production operations, such as handling,

29

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

30

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

31

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

32

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

33

state. Every redevelopment agency created pursuant to chapter 31 of title 45 is deemed to be a

34

subdivision of the municipality where it is located.

193


1 2

(9)(8) 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).

3

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

4

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

5

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

6

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

7

except sub-sector 3118 (bakeries);

8

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

9

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

10

donuts, danish, cakes, tortes, pies, tarts, muffins, bars, cookies, tortillas; and is not sold with

11

utensils provided by the seller, including plates, knives, forks, spoons, glasses, cups, napkins, or

12

straws.

13 14

(10)(9) Medicines, drugs and durable medical equipment. From the sale and from the storage, use, or other consumption in this state, of;

15

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

16

insulin whether or not sold on prescription, and over-the-counter drugs as defined in § 44-18-

17

7.1(h)(ii). For purposes of this exemption, over-the-counter drugs shall not include over the

18

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

19

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

20

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

21

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

22

ambulatory drug delivery pumps which are sold on prescription to individuals to be used by them

23

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

24

dispense or administer prescription drugs shall also be exempt from tax.

25

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

26

the storage, use, or other consumption in this state, of prosthetic devices as defined in § 44-18-

27

7.1(t), sold on prescription, including but not limited to, artificial limbs, dentures, spectacles and

28

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

29

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

30

wheelchairs, crutches and canes.

31

(12)(11) Coffins, caskets, and burial garments. From the sale and from the storage, use,

32

or other consumption in this state of coffins or caskets, and shrouds or other burial garments

33

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

34

(13)(12) Motor vehicles sold to nonresidents.

194


1

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

2

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

3

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

4

A motor vehicle sold to a bona fide nonresident whose state of residence does not allow a like

5

exemption to its nonresidents is not exempt from the tax imposed under § 44-18-20. In that event

6

the bona fide nonresident pays a tax to Rhode Island on the sale at a rate equal to the rate that

7

would be imposed in his or her state of residence not to exceed the rate that would have been

8

imposed under § 44-18-20. Notwithstanding any other provisions of law, a licensed motor vehicle

9

dealer shall add and collect the tax required under this subdivision and remit the tax to the tax

10

administrator under the provisions of chapters 18 and 19 of this title. When a Rhode Island

11

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

12

motor vehicle to a bona fide nonresident as provided in this section, the dealer in computing the

13

tax takes into consideration the law of the state of the nonresident as it relates to the trade-in of

14

motor vehicles.

15

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

16

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

17

tax administrator deems reasonably necessary to substantia te the exemption provided in this

18

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

19

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

20

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

21

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

22

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

23

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

24

provisions of § 44-18-20.

25

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

26

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

27

person licensed under § 40-9-11.1.

28

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

29

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

30

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

31

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

32

of title 46 and chapter 25 of title 23, respectively, and which has been certified as approved for

33

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

34

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

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1

incorporation into those facilitie s or used and consumed in the operation of those facilities to the

2

extent that that portion has as its primary purpose the control of the pollution or contamination of

3

the waters or air of this state. As used in this subdivision, "facility" means any land, facility,

4

device, building, machinery, or equipment.

5

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

6

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

7

other organizations and associations mentioned in subdivision (5), or by privately owned and

8

operated summer camps for children.

9

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

10

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

11

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

12

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

13

accommodations to any student or teacher necessitated by attendance at an educational

14

institution. "Educational institution" as used in this section means an institution of learning not

15

operated for profit which is empowered to confer diplomas, educational, literary, or academic

16

degrees, which has a regular faculty, curriculum, and organized body of pupils or students in

17

attendance throughout the usual school year, which keeps and furnishes to students and others

18

records required and accepted for entrance to schools of secondary, collegia te, or graduate rank,

19

no part of the net earnings of which inures to the benefit of any individual.

20

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

21

(i) From the sale of: (A) special adaptations, (B) the component parts of the special

22

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

23

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

24

vehicle is necessary to transport a family member with a disability or where the vehicle has been

25

specially adapted to meet the specific needs of the person with a disability. This exemption

26

applies to not more than one motor vehicle owned and registered for personal, noncommercial

27

use.

28

(ii) For the purpose of this subsection the term "special adaptations" includes, but is not

29

limited to: wheelchair lifts; wheelchair carriers; wheelchair ramps; wheelchair securements; hand

30

controls; steering devices; extensions, relocations, and crossovers of operator controls; power-

31

assisted controls; raised tops or dropped floors; raised entry doors; or alternative signaling

32

devices to auditory signals.

33

(iii) From the sale of: (a) special adaptations, (b) the component parts of the special

34

adaptations, for a "wheelchair accessible taxicab" as defined in ยง 39-14-1 and/or a "wheelchair

196


1

accessible public motor vehicle" as defined in ยง 39-14.1-1.

2

(iv) For the purpose of this subdivision the exemption for a "specially adapted motor

3

vehicle" means a use tax credit not to exceed the amount of use tax that would otherwise be due

4

on the motor vehicle, exclusive of any adaptations. The use tax credit is equal to the cost of the

5

special adaptations, including installation.

6 7

(20)(19) Heating fuels. From the sale and from the storage, use, or other consumption in this state of every type of fuel used in the heating of homes and residential premises.

8

(21)(20) Electricity and gas. From the sale and from the storage, use, or other

9

consumption in this state of electricity and gas furnished for domestic use by occupants of

10

residential premises.

11

(22 (21) Manufacturing machinery and equipment.

12

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

13

dies, and molds, and machinery and equipment (including replacement parts), and related items to

14

the extent used in an industrial plant in connection with the actual manufacture, conversion, or

15

processing of tangible personal property, or to the extent used in connection with the actual

16

manufacture, conversion or processing of computer software as that term is utilized in industry

17

numbers 7371, 7372, and 7373 in the standard industrial classification manual prepared by the

18

technical committee on industrial classification, office of statistical standards, executive office of

19

the president, United States bureau of the budget, as revised from time to time, to be sold, or that

20

machinery and equipment used in the furnishing of power to an industrial manufacturing plant.

21

For the purposes of this subdivision, "industria l plant" means a factory at a fixed location

22

primarily engaged in the manufacture, conversion, or processing of tangible personal property to

23

be sold in the regular course of business;

24

(ii) Machinery and equipment and related items are not deemed to be used in connection

25

with the actual manufacture, conversion, or processing of tangible personal property, or in

26

connection with the actual manufacture, conversion or processing of computer software as that

27

term is utilized in industry numbers 7371, 7372, and 7373 in the standard industrial classification

28

manual prepared by the technical committee on industrial classification, office of statistical

29

standards, executive office of the president, United States bureau of the budget, as revised from

30

time to time, to be sold to the extent the property is used in administration or distribution

31

operations;

32

(iii) Machinery and equipment and related items used in connection with the actual

33

manufacture, conversion, or processing of any computer software or any tangible personal

34

property which is not to be sold and which would be exempt under subdivision (7) or this

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1

subdivision if purchased from a vendor or machinery and equipment and related items used

2

during any manufacturing, converting or processing function is exempt under this subdivision

3

even if that operation, function, or purpose is not an integral or essential part of a continuous

4

production flow or manufacturing process;

5

(iv) Where a portion of a group of portable or mobile machinery is used in connection

6

with the actual manufacture, conversion, or processing of computer software or tangible personal

7

property to be sold, as previously defined, that portion, if otherwise qualifying, is exempt under

8

this subdivision even though the machinery in that group is used in terchangeably and not

9

otherwise identifiable as to use.

10

(23)(22) Trade-in value of motor vehicles. From the sale and from the storage, use, or

11

other consumption in this state of so much of the purchase price paid for a new or used

12

automobile as is allocated for a trade-in allowance on the automobile of the buyer given in trade

13

to the seller or of the proceeds applicable only to the motor vehicle as are received from an

14

insurance claim as a result of a stolen or damaged motor vehicle , or of the proceeds applicable

15

only to the automobile as are received from the manufacturer of automobiles for the repurchase of

16

the automobile whether the repurchase was voluntary or not towards the purchase of a new or

17

used automobile by the buyer; provided, that the proceeds from an insurance claim or repurchase

18

is in lieu of the benefit prescribed in ยง 44-18-21 for the total loss or destruction of the automobile;

19

and provided, further, that the tax has not been reimbursed as part of the insurance claim or

20

repurchase. For the purpose of this subdivision, the word "automobile" means a private passenger

21

automobile not used for hire and does not refer to any other type of motor vehicle.

22

(24)(23) Precious metal bullion. (i) From the sale and from the storage, use, or other

23

consumption in this state of precious metal bullion, substantially equivalent to a transaction in

24

securities or commodities.

25

(ii) For purposes of this subdivision, "precious metal bullion" means any elementary

26

precious metal which has been put through a process of smelting or refining, including, but not

27

limited to, gold, silver, platinum, rhodium, and chromium, and which is in a state or condition

28

that its value depends upon its content and not upon its form.

29

(iii) The term does not include fabricated precious metal which has been processed or

30

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

31

uses.

32

(25)(24) Commercial vessels. From sales made to a commercial ship, barge, or other

33

vessel of fifty (50) tons burden or over, primarily engaged in interstate or foreign commerce, and

34

from the repair, alteration, or conversion of the vessels, and from the sale of property purchased

198


1

for the use of the vessels including provisions, supplies, and material for the maintenance and/or

2

repair of the vessels.

3

(26)(25) Commercial fishing vessels. From the sale and from the storage, use, or other

4

consumption in this state of vessels and other water craft which are in excess of five (5) net tons

5

and which are used exclusively for "commercial fishing", as defined in this subdivision, and from

6

the repair, alteration, or conversion of those vessels and other watercraft, and from the sale of

7

property purchased for the use of those vessels and other watercraft including provisions,

8

supplie s, and material for the maintenance and/or repair of the vessels and other watercraft and

9

the boats nets, cables, tackle, and other fishing equipment appurtenant to or used in connection

10

with the commercial fishing of the vessels and other watercraft. "Commercial fishing" means the

11

taking or the attempting to take any fish, shellfish, crustacea, or bait species with the intent of

12

disposing of them for profit or by sale, barter, trade, or in commercial channels. The term does

13

not include subsistence fishing, i.e., the taking for personal use and not for sale or barter; or sport

14

fishing; but shall include vessels and other watercraft with a Rhode Island party and charter boat

15

license issued by the department of environmental management pursuant to ยง 20-2-27.1 which

16

meet the following criteria: (i) the operator must have a current U.S.C.G. license to carry

17

passengers for hire; (ii) U.S.C.G. vessel documentation in the coast wide fishery trade; (iii)

18

U.S.C.G. vessel documentation as to proof of Rhode Island home port status or a Rhode Island

19

boat registration to prove Rhode Island home port status; (iv) the vessel must be used as a

20

commercial passenger carrying fishing vessel to carry passengers for fishing. The vessel must be

21

able to demonstrate that at least fifty percent (50%) of its annual gross income derives from

22

charters or provides documentation of a minimum of one hundred (100) charter trips annually; (v)

23

the vessel must have a valid Rhode Island party and charter boat license. The tax administrator

24

shall implement the provisions of this subdivision by promulgating rules and regulations relating

25

thereto.

26

(27)(26) Clothing and footwear. From the sales of articles of clothing, including

27

footwear, intended to be worn or carried on or about the human body. For the purposes of this

28

section, "clothing or footwear" does not include clothing accessories or equipment or special

29

clothing or footwear primarily designed for athletic activity or protective use as these terms are

30

defined in ยง 44-18-7.1(f).

31

(28)(27) Water for residential use. From the sale and from the storage, use, or other

32

consumption in this state of water furnished for domestic use by occupants of residential

33

premises.

34

(29)(28) Bibles. [Unconstitutional; see Ahlburn v. Clark, 728 A.2d 449 (R.I. 1999); see

199


1

Notes to Decisions.] From the sale and from the storage, use, or other consumption in the state of

2

any canonized scriptures of any tax-exempt nonprofit religious organization including, but not

3

limited to, the Old Testament and the New Testament versions.

4

(30)(29) Boats.

5

(i) From the sale of a boat or vessel to a bona fide nonresident of this state who does not

6

register the boat or vessel in this state, or document the boat or vessel with the United States

7

government at a home port within the state, whether the sale or delivery of the boat or vessel is

8

made in this state or elsewhere; provided, that the nonresident transports the boat within thirty

9

(30) days after delivery by the seller outside the state for use thereafter solely outside the state.

10

(ii) The tax administrator, in addition to the provisions of §§ 44-19-17 and 44-19-28, may

11

require the seller of the boat or vessel to keep records of the sales to bona fide nonresidents as the

12

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

13

subdivision, including the affidavit of the seller that the buyer represented himself or herself to be

14

a bona fide nonresident of this state and of the buyer that he or she is a nonresident of this state.

15

(31)(30) Youth activities equipment. From the sale, storage, use, or other consumption in

16

this state of items for not more than twenty dollars ($20.00) each by nonprofit Rhode Island

17

eleemosynary organizations, for the purposes of youth activities which the organization is formed

18

to sponsor and support; and by accredited elementary and secondary schools for the purposes of

19

the schools or of organized activities of the enrolled students.

20

(32)(31) Farm equipment. From the sale and from the storage or use of machinery and

21

equipment used directly for commercial farming and agricultural production; including, but not

22

limited to, tractors, ploughs, harrows, spreaders, seeders, milking machines, silage conveyors,

23

balers, bulk milk storage tanks, trucks with farm plates, mowers, combines, irrigation equipment,

24

greenhouses and greenhouse coverings, graders and packaging machines, tools and supplies and

25

other farming equipment, including replacement parts, appurtenant to or used in connection with

26

commercial farming and tools and supplies used in the repair and maintenance of farming

27

equipment. "Commercial farming" means the keeping or boarding of five (5) or more horses or

28

the production within this state of agricultural products, including, but not limited to, field or

29

orchard crops, livestock, dairy, and poultry, or their products, where the keeping, boarding, or

30

production provides at least two thousand five hundred dollars ($2,500) in annual gross sales to

31

the operator, whether an individual, a group, a partnership, or a corporation for exemptions issued

32

prior to July 1, 2002; for exemptions issued or renewed after July 1, 2002, there shall be two (2)

33

levels. Level I shall be based on proof of annual gross sales from commercial farming of at least

34

twenty-five hundred dollars ($2,500) and shall be valid for purchases subject to the exemption

200


1

provided in this subdivision except for motor vehicles with an excise tax value of five thousand

2

dollars ($5,000) or greater; Level II shall be based on proof of annual gross sales from

3

commercial farming of at least ten thousand dollars ($10,000) or greater and shall be valid for

4

purchases subject to the exemption provided in this subdivision including motor vehicles with an

5

excise tax value of five thousand dollars ($5,000) or greater. For the initia l issuance of the

6

exemptions, proof of the requisite amount of annual gross sales from commercial farming shall be

7

required for the prior year; for any renewal of an exemption granted in accordance with this

8

subdivision at either Level I or Level II, proof of gross annual sales from commercial farming at

9

the requisite amount shall be required for each of the prior two (2) years. Certificates of

10

exemption issued or renewed after July 1, 2002, shall clearly indicate the level of the exemption

11

and be valid for four (4) years after the date of issue. This exemption applies even if the same

12

equipment is used for ancillary uses, or is temporarily used for a non-farming or a non-

13

agricultural purpose, but shall not apply to motor vehicles acquired after July 1, 2002, unless the

14

vehicle is a farm vehicle as defined pursuant to ยง 31-1-8 and is eligible for registration displaying

15

farm plates as provided for in ยง 31-3-31.

16 17 18 19

(33)(32) Compressed air. From the sale and from the storage, use, or other consumption in the state of compressed air. (34)(33) Flags. From the sale and from the storage, consumption, or other use in this state of United States, Rhode Island or POW-MIA flags.

20

(35)(34) Motor vehicle and adaptive equipment to certain veterans. From the sale of a

21

motor vehicle and adaptive equipment to and for the use of a veteran with a service-connected

22

loss of or the loss of use of a leg, foot, hand, or arm, or any veteran who is a double amputee,

23

whether service connected or not. The motor vehicle must be purchased by and especially

24

equipped for use by the qualifying veteran. Certificate of exemption or refunds of taxes paid is

25

granted under rules or regulations that the tax administrator may prescribe.

26

(36)(35) Textbooks. From the sale and from the storage, use, or other consumption in this

27

state of textbooks by an "educational institution" as defined in subdivision (18) of this section and

28

as well as any educational institution within the purview of ยง 16-63-9(4) and used textbooks by

29

any purveyor.

30

(37)(36) Tangible personal property and supplies used in on-site hazardous waste

31

recycling, reuse, or treatment. From the sale, storage, use, or other consumption in this state of

32

tangible personal property or supplies used or consumed in the operation of equipment, the

33

exclusive function of which is the recycling, reuse, or recovery of materials (other than precious

34

metals, as defined in subdivision (24)(ii) of this section) from the treatment of "hazardous

201


1

wastes", as defined in ยง 23-19.1-4, where the "hazardous wastes" are generated in Rhode Island

2

solely by the same taxpayer and where the personal property is located at, in, or adjacent to a

3

generating facility of the taxpayer in Rhode Island. The taxpayer shall procure an order from the

4

director of the department of environmental management certifying that the equipment and/or

5

supplies as used, or consumed, qualify for the exemption under this subdivision. If any

6

information relating to secret processes or methods of manufacture, production, or treatment is

7

disclosed to the department of environmental management only to procure an order, and is a

8

"trade secret" as defined in ยง 28-21-10(b), it is not open to public inspection or publicly disclosed

9

unless disclosure is required under chapter 21 of title 28 or chapter 24.4 of title 23.

10

(38)(37) Promotional and product literature of boat manufacturers. From the sale and

11

from the storage, use, or other consumption of promotional and product literature of boat

12

manufacturers shipped to points outside of Rhode Island which either: (i) accompany the product

13

which is sold, (ii) are shipped in bulk to out of state dealers for use in the sale of the product, or

14

(iii) are mailed to customers at no charge.

15

(39 (38) Food items paid for by food stamps. From the sale and from the storage, use, or

16

other consumption in this state of eligible food items payment for which is properly made to the

17

retailer in the form of U.S. government food stamps issued in accordance with the Food Stamp

18

Act of 1977, 7 U.S.C. ยง 2011 et seq.

19

(40)(39) Transportation charges. From the sale or hiring of motor carriers as defined in ยง

20

39-12-2(l) to haul goods, when the contract or hiring cost is charged by a motor freight tariff filed

21

with the Rhode Island public utilities commission on the number of miles driven or by the

22

number of hours spent on the job.

23

(41)(40) Trade-in value of boats. From the sale and from the storage, use, or other

24

consumption in this state of so much of the purchase price paid for a new or used boat as is

25

allocated for a trade-in allowance on the boat of the buyer given in trade to the seller or of the

26

proceeds applicable only to the boat as are received from an insurance claim as a result of a stolen

27

or damaged boat, towards the purchase of a new or used boat by the buyer.

28

(42)(41) Equipment used for research and development. From the sale and from the

29

storage, use, or other consumption of equipment to the extent used for research and development

30

purposes by a qualifying firm. For the purposes of this subdivision, "qualifying firm" means a

31

business for which the use of research and development equipment is an integral part of its

32

operation, and "equipment" means scientific equipment, computers, software, and related items.

33 34

(43)(42) Coins. From the sale and from the other consumption in this state of coins having numismatic or investment value.

202


1

(44) (43) Farm structure construction materials. Lumber, hardware and other materials

2

used in the new construction of farm structures, including production facilities such as, but not

3

limited to, farrowing sheds, free stall and stanchion barns, milking parlors, silos, poultry barns,

4

laying houses, fruit and vegetable storages, rooting cellars, propagation rooms, greenhouses,

5

packing rooms, machinery storage, seasonal farm worker housing, certified farm markets, bunker

6

and trench silos, feed storage sheds, and any other structures used in connection with commercial

7

farming.

8

(45)(44) Telecommunications carrier access service. Carrier access service or

9

telecommunications service when purchased by a telecommunications company from another

10

telecommunications company to facilitate the provision of telecommunications service.

11

(46)(45) Boats or vessels brought into the state exclusively for winter storage,

12

maintenance, repair or sale. Notwithstanding the provisions of §§ 44-18-10, 44-18-11, 44-18-20,

13

the tax imposed by § 44-18-20 is not applicable for the period commencing on the first day of

14

October in any year to and including the 30th day of April next succeeding with respect to the use

15

of any boat or vessel within this state exclusively for purposes of: (i) delivery of the vessel to a

16

facility in this state for storage, including dry storage and storage in water by means of apparatus

17

preventing ice damage to the hull, maintenance, or repair; (ii) the actual process of storage,

18

maintenance, or repair of the boat or vessel; or (iii) storage for the purpose of selling the boat or

19

vessel.

20

(47)(46) Jewelry display product. From the sale and from the storage, use, or other

21

consumption in this state of tangible personal property used to display any jewelry product;

22

provided, that title to the jewelry display product is transferred by the jewelry manufacturer or

23

seller and that the jewelry display product is shipped out of state for use solely outside the state

24

and is not returned to the jewelry manufacturer or seller.

25

(48)(47) Boats or vessels generally. Notwithstanding the provisions of this chapter, the

26

tax imposed by §§ 44-18-20 and 44-18-18 shall not apply with respect to the sale and to the

27

storage, use, or other consumption in this state of any new or used boat. The exemption provided

28

for in this subdivision does not apply after October 1, 1993, unless prior to October 1, 1993, the

29

federal ten percent (10%) surcharge on luxury boats is repealed.

30

(49)(48) Banks and Regulated investment companies interstate toll-free calls.

31

Notwithstanding the provisions of this chapter, the tax imposed by this chapter does not apply to

32

the furnishing of interstate and international, toll-free terminating telecommunication service that

33

is used directly and exclusively by or for the benefit of an eligible company as defined in this

34

subdivision; provided, that an eligible company employs on average during the calendar year no

203


1

less than five hundred (500) "full-time equivalent employees", as that term is defined in ยง 42-

2

64.5-2. For purposes of this section, an "eligible company" means a "regulated investment

3

company" as that term is defined in the Internal Revenue Code of 1986, 26 U.S.C. ยง 1 et seq., or a

4

corporation to the extent the service is provided, directly or indirectly, to or on behalf of a

5

regulated investment company, an employee benefit plan, a retirement plan or a pension plan or a

6

state chartered bank.

7

(50)(49) Mobile and manufactured homes generally. From the sale and from the storage,

8

use, or other consumption in this state of mobile and/or manufactured homes as defined and

9

subject to taxation pursuant to the provisions of chapter 44 of title 31.

10

(51)(50) Manufacturing business reconstruction materials.

11

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

12

hardware, and other building materials used in the reconstruction of a manufacturing business

13

facility which suffers a disaster, as defined in this subdivision, in this state. "Disaster" means any

14

occurrence, natural or otherwise, which results in the destruction of sixty percent (60%) or more

15

of an operating manufacturing business facility within this state. "Disaster" does not include any

16

damage resulting from the willful act of the owner of the manufacturing business facility.

17 18 19 20 21 22

(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.

23

(52) Tangible personal property and supplies used in the processing or preparation of

24

floral products and floral arrangements. From the sale, storage, use or other consumption in this

25

state of tangible personal property or supplies purchased by florists, garden centers, or other like

26

producers of vendors of flowers, plants, floral products, and natural and artificial floral

27

arrangements which are ultimately sold with flowers, plants, floral products, and natural and

28

artificial floral arrangements or are otherwise used in the decoration, fabrication, creation,

29

processing, or preparation of flowers, plants, floral products, or natural and artificial floral

30

arrangements, including descriptive labels, stickers, and cards affixed to the flower, plant, floral

31

product or arrangement, artificial flowers, spray materials, floral paint and tint, plant shine, flower

32

food, insecticide and fertilizers.

33

(53)(51) Horse food products. From the sale and from the storage, use, or other

34

consumption in this state of horse food products purchased by a person engaged in the business of

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1

the boarding of horses.

2

(54)(52) Non-motorized recreational vehicles sold to nonresidents.

3

(i) From the sale, subsequent to June 30, 2003, of a non-motorized recreational vehicle to

4

a bona fide nonresident of this state who does not register the non-motorized recreational vehicle

5

in this state, whether the sale or delivery of the non-motorized recreational vehicle is made in this

6

state or at the place of residence of the nonresident; provided, that a non-motorized recreational

7

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

8

to its nonresidents is not exempt from the tax imposed under § 44-18-20; provided, further, that in

9

that event the bona fide nonresident pays a tax to Rhode Island on the sale at a rate equal to the

10

rate that would be imposed in his or her state of residence not to exceed the rate that would have

11

been imposed under § 44-18-20. Notwithstanding any other provisions of law, a licensed non-

12

motorized recreational vehicle dealer shall add and collect the tax required under this subdivision

13

and remit the tax to the tax administrator under the provisions of chapters 18 and 19 of this title.

14

Provided, that when a Rhode Island licensed non-motorized recreational vehicle dealer is required

15

to add and collect the sales and use tax on the sale of a non-motorized recreational vehicle to a

16

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

17

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

18

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

19

require any licensed non-motorized recreational vehicle dealer to keep records of sales to bona

20

fide nonresidents as the tax administrator deems reasonably necessary to substantiate the

21

exemption provided in this subdivision, including the affidavit of a licensed non-motorized

22

recreational vehicle dealer that the purchaser of the non-motorized recreational vehicle was the

23

holder of, and had in his or her possession a valid out-of-state non-motorized recreational vehicle

24

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

25

(iii) Any nonresident who registers a non-motorized recreational vehicle in this state

26

within ninety (90) days of the date of its sale to him or her is deemed to have purchased the non-

27

motorized recreational vehicle for use, storage, or other consumption in this state, and is subject

28

to, and liable for the use tax imposed under the provisio ns of § 44-18-20.

29

(iv) "Non-motorized recreational vehicle" means any portable dwelling designed and

30

constructed to be used as a temporary dwelling for travel, camping, recreational, and vacation use

31

which is eligible to be registered for highway use, including, but not limited to, "pick-up coaches"

32

or "pick-up campers," "travel trailers," and "tent trailers" as those terms are defined in chapter 1

33

of title 31.

34

(55)(53) Sprinkler and fire alarm systems in existing buildings. From the sale in this state

205


1

of sprinkler and fire alarm systems, emergency lighting and alarm systems, and from the sale of

2

the materials necessary and attendant to the installation of those systems, that are required in

3

buildings and occupancies existing therein in July 2003, in order to comply with any additional

4

requirements for such buildings arising directly from the enactment of the Comprehensive Fire

5

Safety Act of 2003, and that are not required by any other provision of law or ordinance or

6

regulation adopted pursuant to that Act. The exemption provided in this subdivision shall expire

7

on December 31, 2008.

8

(56)(54) Aircraft. Notwithstanding the provisions of this chapter, the tax imposed by §§

9

44-18-18 and 44-18-20 shall not apply with respect to the sale and to the storage, use, or other

10

consumption in this state of any new or used aircraft or aircraft parts.

11

(57)(55) Renewable energy products. Notwithstanding any other provisions of Rhode

12

Island general laws the following products shall also be exempt from sales tax: solar photovoltaic

13

modules or panels, or any module or panel that generates electricity from light; solar thermal

14

collectors, including, but not limited to, those manufactured with flat glass plates, extruded

15

plastic, sheet metal, and/or evacuated tubes; geothermal heat pumps, including both water-to-

16

water and water-to-air type pumps; wind turbines; towers used to mount wind turbines if

17

specified by or sold by a wind turbine manufacturer; DC to AC inverters that interconnect with

18

utility power lines; manufactured mounting racks and ballast pans for solar collector, module or

19

panel installation. Not to include materials that could be fabricated into such racks; monitoring

20

and control equipment, if specified or supplied by a manufacturer of solar thermal, solar

21

photovoltaic, geothermal, or wind energy systems or if required by law or regulation for such

22

systems but not to include pumps, fans or plumbing or electrical fixtures unless shipped from the

23

manufacturer affixed to, or an integral part of, another item specified on this list; and solar storage

24

tanks that are part of a solar domestic hot water system or a solar space heating system. If the tank

25

comes with an external heat exchanger it shall also be tax exempt, but a standard hot water tank is

26

not exempt from state sales tax.

27

(58)(56) Returned property. The amount charged for property returned by customers

28

upon rescission of the contract of sale when the entire amount exclusive of handling charges paid

29

for the property is refunded in either cash or credit, and where the property is returned within one

30

hundred twenty (120) days from the date of delivery.

31 32

(59)(57) 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.

33 34

(60)(58) Blood. From the sale and from the storage, use or other consumption of human blood.

206


1

(61) Prewritten computer software delivered electronically. From the sale and from the

2

storage, use or other consumption of prewritten computer software delivered electronically or by

3

load and leave.

4

(62)(59) Agricultural products for human consumption. From the sale and from the

5

storage, use or other consumption of livestock and poultry of the kinds of products of which

6

ordinarily constitute food for human consumption and of livestock of the kind the products of

7

which ordinarily constitute fibers for human use.

8 9

(63)(60) Diesel emission control technology. From the sale and use of diesel retrofit technology that is required by § 31-47.3-4 of the general laws.

10 11

44-18-30.B. Exemption from sales tax for sales by writers, composers, artists – Findings. -- (a) The general assembly makes the following findings of facts:

12 13

(1) The downtown area of the city of Providence has been characterized by blighted areas, and dilapidated and abandoned structures;

14 15

(2) As a result, the downtown area has been designated an economic development zone in order to stop the deterioration and stimulate economic activity;

16 17

(3) The capitol center area of the city of Providence has become an attractive location, especially with the construction of the Providence Place Mall;

18

(4) In order to promote, revitalize and redevelop the "Old Downtown" area of the city of

19

Providence it is necessary to provide tax exemptions to this area as it has been designated as an

20

economic development zone;

21

(5) In order to promote, revitalize, and redevelop the "Downtown or other industrial or

22

manufacturing buildings" located in the City of Pawtucket, it is necessary to provide tax

23

exemptions to this area as it has been designated as an economic development zone;

24

(6) The development of an active artistic community, including "artists in residence", in

25

this area would promote economic development, revitalization, tourism, employment

26

opportunities, and encourage business development by providing alternative commercial

27

enterprises while in Providence creating a link between the Old Downtown and the Capital Center

28

Area;

29 30

(7) There is a separate artistic community in the town of Westerly which is important to preserve, promote, and revitalize, and which is distinct from that in the city of Providence;

31

(8) There is a separate artistic community in the city of Woonsocket which is important

32

to promote and revitalize and which is distinct from that in the cities of Providence and Pawtucket

33

and the town of Westerly;

34

(9) There is a separate artistic community in the city of Warwick which is important to

207


1

preserve, promote, and revitalize and which is distinct from that in the cities of Providence,

2

Pawtucket, Woonsocket and the town of Westerly;

3

(10) There are separate artistic communities in the city of Newport and in the town of

4

Tiverton which are important to promote and revitalize and which are distinct from those in the

5

cities of Providence, Pawtucket, Warwick and Woonsocket and the towns of Westerly and Little

6

Compton;

7

(11) There is a separate artistic community in the town of Warren which is important to

8

promote and revitalize and which is distinct from that in the cities of Providence, Pawtucket,

9

Newport, Warwick and Woonsocket and the towns of Westerly and Tiverton.

10

(b) This section only applies to sales by writers, composers and artists residing in and

11

conducting a business within a section of the defined economic development zone in the cities of

12

Providence or Pawtucket, or the defined economic development zone in the town of Westerly or

13

the defined economic zone in the city of Woonsocket, or the defined economic zone in the city of

14

Warwick, or in those areas within the city of Newport, and the town of Little Compton, which are

15

zoned "general business," "waterfront business," or "limited business" or have been designated by

16

the city of Newport as part of the arts district, or in those areas of the town of Warren which are

17

zoned "waterfront district," "special district," "village business district," "manufacturing district,"

18

"business district" or "Warren historic district," or in those areas of the town of Tiverton which

19

are zoned "business commercial," "business waterfront" or "village commercial." For the

20

purposes of this section, a "work" means an original and creative work, whether written,

21

composed or executed for "one-of-a-kind limited" production and which falls into one of the

22

following categories:

23

(i) A book or other writing;

24

(ii) A play or the performance of said play;

25

(iii) A musical composition or the performance of said composition;

26

(iv) A painting or other like picture;

27

(v) A sculpture;

28

(vi) Traditional and fine crafts;

29

(vii) The creation of a film or the acting within the film;

30

(viii) The creation of a dance or the performance of the dance.

31

(2) For the purposes of this section, a "work" includes any product generated as a result

32 33 34

of any of the above categories. (3) For the purposes of this section, a "work" does not apply to any piece or performance created or executed for industry oriented or related production.

208


1

(c) This section applies to sales by any individual:

2

(i) Who is a resident of and has a principal place of business situated in the section of the

3

economic development zone designated as the arts and entertainment district in the downtown

4

area of the city of Providence or in the city of Pawtucket, or the defined economic development

5

zone in the town of Westerly or the defined economic zone in the city of Woonsocket, or the

6

defined economic zone in the city of Warwick, or who is a resident of and has a principal place of

7

business situated in those areas within the city of Newport or the town of Little Compton, which

8

are zoned "general business," "waterfront business," or "limited business," or have been

9

designated by the city of Newport as part of the arts district, or who is a resident of and has a

10

principal place of business situated in those areas within the town of Warren which are zoned

11

"waterfront district," "special district," "village business district," "manufacturing district,"

12

"business district" or "Warren historic district," or who is a resident or has a principal place of

13

business situated in those areas within the town of Tiverton which are zoned "business

14

commercial," "business waterfront" or "village commercial." For the purposes of this section, the

15

Providence arts and entertainment district in Providence is defined as the area bounded by Pine

16

Street to the southeast, Dorrance Street to the northeast, Sabin Street to the northwest and Empire

17

Street to the southwest. Said Providence arts and entertainment district also includes the area

18

beginning at the point of intersection of Acorn Street and Harris Avenue, then turning east onto

19

Atwells Avenue to Service Road 7, then turning southerly onto Service Road 7 to Westminster

20

Street, then turning westerly onto Westminster Street, continuing until Bridgham, then turning

21

south onto Bridgham to Cranston Street, then turning southwesterly onto Cranston Street, then

22

continuing to Messer Street, then turning north onto Messer Street to Westminster Street, turning

23

west onto Westminster Street to US Hwy 6 off ramp, then heading west on US Hwy 6 to Sheridan

24

Street, then heading northeast on Sheridan Street to Aleppo Street, then turning southeast along

25

Aleppo Street to Pelham Street, then heading northeast on Pelham Street to Manton Avenue, then

26

continuing southeast on Manton Avenue until Delaine Street, then heading northeast on Delaine

27

Street until Appleton Street, then continuing northwesterly on Appleton Street until Bowdoin

28

Street, then heading north on Bowdoin Street until Barstow Street, then heading east on Barstow

29

until Valley Street, then heading northeast on Valley Street to Hemlock Street, then turning

30

southeast on Hemlock Street until Promenade Street, then heading east on Promenade Street to

31

Acorn Street, then heading south on Acorn Street to the intersection of Acorn Street and Harris

32

Avenue. The named streets are included in the Providence district; and in Pawtucket is defined as

33

the area beginning at the point of intersection of Dexter Street and the Central Falls line, then east

34

along the Central Falls line to the Blackstone River, then north along the city boundary on the

209


1

Blackstone River to the Cumberland line, then west along the Pawtucket city boundary line to I-

2

95, then south along I-95 to Pine Street, then north on Pine Street to AMTRAK Right of Way,

3

then northwest along the AMTRAK Right of Way to Dexter Street, then north on Dexter Street to

4

the Central Falls line. The named streets are included in the district. The Westerly arts and

5

entertainment district is defined as assessor's plat 56, lots 1 through 24, lot 48, lots 50 through 62,

6

and lots 71 through 82, and assessors plat 66, lots 22 through 26, and lots 29 through 36 the

7

Woonsocket arts and entertainment district is defined as the area beginning at a point of land on

8

the southwest bank of the Blackstone River abutting the bridge for the Providence & Worcester

9

Railroad and proceeding northerly to a point at the intersection of Worrall Street, Clinton Street

10

and Harry S. Truman Drive, then proceeding northwesterly along Worrall Street to its intersection

11

with Social Street, then turning westerly on Social Street proceeding to its intersection with Main

12

Street, Blackstone Street and North Main Street, then turning northwesterly and proceeding along

13

Blackstone Street to its intersection with River Street, then turning northerly and proceeding

14

along River Street to its intersection with the north/east bank of Blackstone River, then following

15

the riverbank southerly to the bridge at Bernon Street and turning easterly crossing the Blackstone

16

River via Bernon Street and proceeding to its intersection with Front Street, then turning

17

northeasterly on Front Street and proceeding to its intersection with Hamlet Avenue, and to

18

include the former courthouse on the southerly side of Front Street at its intersection with Hamlet

19

Avenue, then turning easterly on Hamlet Avenue and proceeding to its intersection with Manville

20

Road, then turning southeasterly on Manville Road and proceeding to its intersection with

21

Davison Avenue, then turning northeasterly on Davison Avenue and proceeding to a point on the

22

south/west bank of the Blackstone River, then turning northerly, following the southerly

23

riverbank to the point of beginning. The abovementioned streets are included in the district. The

24

Warwick arts district is defined as that area known as Pontiac Village, beginning on Route 5 at

25

the Warwick/Cranston municipal boundary, then south to the intersection of Route 5 and the

26

Pawtuxet River, then following the Pawtuxet River in an easterly and northerly direction to the

27

municipal boundary in the vicinity of Knight Street, then from the intersection of Knight Street

28

and the municipal boundary westerly along the Warwick/Cranston municipal boundary to the

29

intersection of Route 5 and Greenwich Avenue. The above named streets are included in the

30

district.

31

(ii) Who is determined by the tax administrator, after consideration of any evidence he or

32

she deems necessary or which is submitted to him or her by the individual, to have written,

33

composed, or executed, either solely or jointly, a work or works which would fall into one of the

34

categories listed in subsection (b)(1).

210


1

(2) This section also applies to sales by any other gallery located in the arts and

2

entertainment district described in subsection (c)(1)(i) as well as any other arts and entertainment

3

district designated by the general assembly, as well as to sales by any other gallery located in

4

those areas within the city of Newport, or the town of Little Compton, which are zoned "general

5

business," "waterfront business," or "limited business" or have been designated by the city of

6

Newport as part of the arts district, as well as to sales by any other gallery located in those areas

7

within the town of Warren which are zoned "waterfront district," "special district," "village

8

business district," "manufacturing district," "business district" or "Warren historic district," as

9

well as to sales by any other gallery located in those areas within the town of Tiverton which are

10

zoned "business commercial," "business waterfront" or "village commercial."

11

(3) The tax administrator shall not make a determination unless:

12

(i) The individual(s) concerned duly make(s) an application to the tax administrator for

13 14 15

the sales tax exemption which applies to the works defined in this section; and (ii) The individual has complied and continues to comply with any and all requests made by the tax administrator.

16

(d) Except as otherwise provided in ยง 44-18-12.2, A any individual to whom this section

17

applies and who makes an application to the tax administrator is entitled to a sales tax exemption

18

for the sale of a work or works sold from the individual's business located in the economic

19

development zone which would, apart from this section, be subject to the tax rate imposed by the

20

state of Rhode Island.

21

(e) When an individual makes a request for the exemption, the tax administrator is

22

entitled to all books, documents, or other evidence relating to the publication, production or

23

creation of the works that may be deemed necessary by the tax administrator for the purposes of

24

the exemption. The time period in which to provide this information is in the sole discretion of

25

the tax administrator and specified in the notice.

26

(f) In addition to the information required in subsection (e), the tax administrator may

27

require the individual(s) to submit an annual certified accounting of the numbers of works sold,

28

the type of work sold, and the date of the sale. Failure to file this report may, in the sole discretion

29

of the tax administrator, terminate the individual's eligibility for the exemption under this section.

30

(g) Except as otherwise provided in ยง 44-18-12.2, A any any person storing, using, or

31

otherwise consuming in this state any work or works which is deemed to be exempt from the

32

sales tax pursuant to this section is not liable for the use tax on the work or works.

33

(h) Notwithstanding the provisions of this section, any individual to whom this section

34

may apply shall comply with all the administration, collection, and other provisions of chapters

211


1

18 and 19 of this title.

2

44-18-30.C. Exemption from or stabilization of sales and use taxes for municipal

3

economic development zones – West Warwick. -- (a) Findings. The general assembly makes

4

the following findings of fact:

5

(1) Various sections of several towns in the state, including, but not limited to, the town

6

of West Warwick, are deteriorated, blighted areas which have created very difficult challenges to

7

economic development;

8

(2) Several areas of the state are in a distressed financial condition as defined by § 45-13-

9

12(b) and cannot finance economic development projects on its own without the participation of

10 11 12

private enterprise; (3) The general assembly has found that it is nearly impossible for private enterprise alone to meet these challenges;

13

(4) In certain sections of financially distressed communities, the serious challenges of

14

economic development and/or redevelopment have not been met by private enterprise alone and

15

the impact is being felt throughout the community;

16 17

(5) Legislation enacted to encourage redevelopment of the deteriorated, blighted areas through the formation of local redevelopment agencies has had very limited success;

18

(6) Various states, such as New Jersey, Pennsylvania and Michigan have had a great deal

19

of success in generating economic development by exercising the authority to exempt and/or

20

stabilize taxes;

21

(7) The state of Rhode Island has generated economic growth by redirecting and/or

22

exempting certain commercial and retail activity from the imposition of sales, use and income

23

taxes with recent examples being the Providence Place Mall, the Arts Districts in the cities of

24

Providence, Pawtucket and Westerly, and financial services and acquaculture industries;

25

(8) Most recently, municipalities in our state have had great success in attracting large

26

commercial development, including financial services, manufacturing, and major energy

27

facilities, due in la rge part to the authority to exempt and/or stabilize property, tangible and/or

28

inventory taxes;

29

(9) Attracting large non-residential developments or encouraging expansion of existing

30

commercial entities can be extremely important to municipalities, where the quality of public

31

education is largely dependent on the local tax base, thereby expanding the commercial tax base

32

and reducing reliance upon the residential tax base;

33

(10) The ability to attract this development and increase the non-residential tax base, in

34

turn, improves municipalities' ability to finance school systems, municipal services and

212


1 2 3

infrastructure, thereby improving the quality of life; (11) In addition to increasing the local non-residential tax base, this development creates construction jobs, permanent jobs, and spurs additional investment by private enterprises; and

4

(12) Providing authority to offer tax exemptions from, or to stabilize, the imposition of

5

sales and use taxes will attract and assist in expanding, revitalizing and redeveloping the tax base

6

in our municipalities, thereby providing long-term economic benefits and development.

7

(1) In order to attract new construction and development in a municipal economic

8

development zone (MED) as provided in this section, upon the designation of such a zone as set

9

forth in subsection (c) of this section, except as otherwise provided in § 44-18-12.2, all businesses

10

engaging in qualifying sales and located in new construction in a MED zone (a MED zone

11

business) shall be exempt from the requirement to charge and collect fifty percent (50%) of the

12

current sales and use tax pursuant to §§ 44-18-18 and 44-18-20 for a period of ten (10) years.

13

Sales and use taxes collected in a MED zone shall be returned to the same MED zone in

14

accordance with the provisions of this section. The ten (10) year exemption period for all MED

15

zone businesses shall begin to run from the latest to occur of: (i) the date that is three (3) years

16

from the effective date of the January session 2003 amendments [July 17, 2003]; or (ii) the date

17

that is two (2) years from the date upon which the city or town council designates the MED zone

18

for its municipality; or (iii) the date the first MED zone business obtains a certification of

19

exemption as set forth in subdivision (c)(6) of this section.

20

(2) For purposes of this section, "qualifying sales" for a MED zone business shall not

21

include gambling activities, or the retail sales of motor vehicles, furniture, home furnishings

22

including mattresses and oriental rugs, tobacco products, or packaged alcoholic beverages.

23 24

(3) "Qualifying sales" shall be sales at which the point of sale is located within the same MED zone and point of delivery is located within the same MED zone.

25

(1) The city or town council of a financially distressed community may designate in

26

accordance with the provisions of this section one MED zone in the municipality, provided that

27

the municipality is:

28 29

(i) A financially distressed community as defined by § 45-13-12(b), using the criteria set forth in § 45-13-12(b)(1) through (4);

30

(ii) Has a population less than fifty thousand (50,000) persons; and

31

(iii) The MED zone shall be a parcel of or contiguous parcels of land consisting in total

32

of not less than ten (10) acres, but not more than thirty (30) acres in the area served by adequate

33

utilities and transportation facilities.

34

(2) The city or town council of any financially distressed city or town, as set forth in

213


1

subdivision (1) of this subsection, in creating a MED zone, shall have the power and authority of

2

a redevelopment agency, as provided in chapter 32 of title 45, to undertake the redevelopment of

3

a MED zone.

4

(3) The city or town council, in designating a MED zone, shall after public notice,

5

hearing and vote as provided by § 45-32-4, comply with the plan requirements of § 45-32-8 and

6

shall be responsible for carrying on the plan. The city or town council in implementing the MED

7

zone plan shall have the power of eminent domain as set forth in § 45-32-24, and the provisions

8

of §§ 45-32-25 – 45-32-41 shall apply to all such condemnations.

9

(4) All sales and use taxes collected within a MED zone shall be reimbursed to the

10

municipality in which the MED zone is located, and may be expended by the municipality to

11

implement the capital improvement component of the MED zone plan for MED zone property or

12

for property located within one mile of the MED zone or for such other capital improvements as

13

the municipality may determine are required to mitigate MED zone impacts.

14

(5) West Warwick. The following area or portions of them of the town of West Warwick

15

may be designated as the town's municipal economic development zone by the town council of

16

the town of West Warwick after public notice, hearing and vote as provided in § 45-32-4: The

17

area bounded generally by the East Coast Bike Path in the east, Archambault and Gardner

18

Avenue in the north, Payan Street to Curson Street, Curson Street to McNiff, McNiff to Barnes

19

Street, Barnes Street to Nowicki Street to East Street, East Street to Blanchard Street, Blanchard

20

Street to West Street in the west, West Street to Washington Street, Washington Street to Nolan

21

Street, Nolan Street to the East Coast Bike Path in the south, all as more particularly described on

22

the West Warwick municipal economic development zone map on file with the town clerk.

23

(6) The tax administrator shall issue a certification of exemption to the MED zone

24

business at the time the business applies for its permit to make sales at retail and provides the tax

25

administrator with a MED zone business certificate issued by the town clerk stating that the

26

business is located in new construction in the MED zone. The duration of the certificate shall be

27

determined in accordance with subdivision (b)(1) of this section.

28

(7) No business shall be permitted to become a MED zone business or to receive a

29

certificate of exemption pursuant to subdivision (6) of this subsection by relocating from any area

30

within the state of Rhode Island but outside the MED zone to new construction within the MED

31

zone, unless the relocation results in the creation of new permanent employment positions that

32

increase the total employment of the business by not less than fifty percent (50%) of its average

33

total employment for the two (2) year period immediately preceding the year in which it applies

34

for its certificate of exemption. Any business that expands its operations by adding a new location

214


1

within the MED zone and then ceases to operate any of its locations within the state of Rhode

2

Island that existed prior to the establishment of the MED zone location shall immediately have its

3

certificate of exemption for the MED zone location revoked.

4

44-18-36.1. Hotel tax. -- (a) There is imposed a hotel tax of five percent (5%) upon the

5

total consideration charged for occupancy of any space furnished by any hotel in this state. The

6

hotel tax is in addition to any sales tax imposed. This hotel tax is administered and collected by

7

the division of taxation and unless provided to the contrary in this chapter, all the administration,

8

collection, and other provisions of chapters 18 and 19 of this title apply. Nothing in this chapter

9

shall be construed to limit the powers of the convention authority of the city of Providence

10

established pursuant to the provisions of chapter 84 of the public laws of 1980, except that

11

distribution of hotel tax receipts shall be made pursuant to chapter 63.1 of title 42 rather than

12

chapter 84 of the public laws of 1980.

13

(b) There is hereby levied and imposed, upon the total consideration charged for

14

occupancy of any space furnished by any hotel in this state, in addition to all other taxes and fees

15

now imposed by law, a local hotel tax at a rate of one percent (1.0%), provided, however, for the

16

period commencing July 1, 2011, the rate is two percent (2%). The local hotel tax shall be

17

administered and collected in accordance with subsection (a).

18

(c) All sums received by the division of taxation for sales prior to July 1, 2011 under this

19

section as taxes, penalties or forfeitures, interest, costs of suit and fines shall be distributed at

20

least quarterly, credited and paid by the state treasurer to the city or town where the space for

21

occupancy that is furnished by the hotel is located. Unless provided to the contrary in this chapter,

22

all of the administration, collection, and other provisions of chapters 18 and 19 of this title shall

23

apply.

24

(d) For sales on or after July 1, 2011, one percent (1%) of the two percent (2%) of the

25

gross receipts paid under ยง 44-18-36.1(b) received by the division of taxation as taxes, penalties

26

or forfeitures, interest, costs of suit and fines shall be distributed at least quarterly, credited and

27

paid by the state treasurer to the city or town where the space for occupancy that is furnished by

28

the hotel is located. The remaining one percent (1%) of the total received by the division of

29

taxation under this section as taxes, penalties or forfeitures, interest, costs of suit and fines shall

30

be deposited in the Tourism Asset Protection Fund which shall be dedicated to capital projects to

31

preserve and enhance state owned assets which are directly related to tourism. Such funds shall

32

be allocated in the annual capital budgeting pursuant to ยง 35-4-24.

33

(d)(e) Notwithstanding the provisions of subsection (a) of this section, the city of

34

Newport shall have the authority to collect from hotels located in the city of Newport the tax

215


1

imposed by subsection (a) of this section.

2

(1) Within ten (10) days of collection of the tax, the city of Newport shall distribute the

3

tax as provided in § 42-63.1-3. No later than the first day of March and the first day of September

4

in each year in which the tax is collected, the city of Newport shall submit to the division of

5

taxation a report of the tax collected and distributed during the six (6) month period ending thirty

6

(30) days prior to the reporting date.

7

(2) The city of Newport shall have the same authority as the division of taxation to

8

recover delinquent hotel taxes pursuant to chapter 44-19, and the amount of any hotel tax, penalty

9

and interest imposed by the city of Newport until collected constitutes a lien on the real property

10

of the taxpayer

11

44-18-40.1. Exemption for certain energy products. -- Except as provided in § 44-18-

12

12.2 or Notwithstanding any other provision of the general laws to the contrary, the gross receipts

13

from the sale, storage, use or other consumption of electricity, steam and thermal energy which is

14

produced, transmitted and/or sold by the Rhode Island economic development corporation are

15

exempt from the taxes imposed by this chapter.

16 17

SECTION 6. Section 44-19-7 of the General Laws in Chapter 44-19 entitled “Sales and Use Taxes – Enforcement & Collection” is hereby amended to read as follows:

18

44-19-7. Registration of retailers. -- Every retailer selling tangible personal property or

19

specified digital products for storage, use, or other consumption in this state, or providing

20

services as defined in § 44-18-7.3, or renting living quarters in any hotel, rooming house, or

21

tourist camp in this state must register with the tax administrator and give the name and address

22

of all agents operating in this state, the location of all distribution or sales houses or offices, or of

23

any hotel, rooming house, or tourist camp or other places of business in this state, and other

24

information that the tax administrator may require.

25 26

SECTION 7. Section 45-37.1-9 of the General Laws in Chapter 45-37.1 entitled “Industrial Facilities Corporation” is hereby amended to read as follows:

27

45-37.1-9. Exemption from taxation. -- (a) The exercise of the powers granted by this

28

chapter will be in all respects for the benefit of the people of this state, for the increase of their

29

commerce, welfare and prosperity, and for the improvement of their health and living conditions,

30

and will constitute the performance of an essential government function, and the corporation is

31

not required to pay any taxes or assessments upon or in respect of a project, or any property or

32

moneys of the corporation, levied by any municipality or political subdivision of the state, nor is

33

the corporation required to pay state taxes of any kind, and the corporation, its projects, property,

34

and moneys, and any bonds and notes issued under the provisions of this chapter, their transfer

216


1

and the income from them, including any profit made on their sale, are at all times free from

2

taxation of every kind by the state except as otherwise provided in ยง 44-18-12.2, and by the

3

municipalities and all other political subdivisions of the state, and the corporation is not required

4

to pay any transfer tax of any kind on account of instruments recorded by or on its behalf or in

5

connection with the financing of any of its projects; provided, that any person, partnership,

6

corporation, or concern leasing a project from the corporation shall pay to the city, town, school

7

district, or other political subdivision or special district having taxing powers, in which the project

8

is located, a payment in lieu of taxes which equals the taxes on real and personal property which

9

the lessee would have been required to pay, had it been the owner of the property during the

10

period for which the payment is made, and under no circumstances are the corporation or its

11

projects, properties, money, bonds, or notes obligated, liable, or subject to a lien of any kind for

12

their enforcement, collection, or payment; and provided, further, that in the case of any person,

13

partnership, corporation, or concern leasing a project from the corporation any such person,

14

partnership, corporation or concern so leased shall be exempt from payment of state sales tax

15

applicable to materials used in construction of such a facility only to the extent that the costs of

16

such materials do not exceed the amount financed through the corporation.

17

(b) If and to the extent the proceedings under which the bonds or notes authorized to be

18

issued under the provisions of this chapter so provide, the corporation may agree to cooperate

19

with the lessee of a project in connection with any administrative or judicial proceedings for

20

determining the validity or amount of payments, and may agree to appoint or designate and

21

reserve the right in and for the lessee to take all action which the corporation may lawfully take in

22

respect of those payments and all matters relating to them, provided, that the lessee bears and pay

23

all costs and expenses of the corporation thereby incurred at the request of the lessee or by reason

24

of any action taken by the lessee in behalf of the corporation. Any lessee of a project, which has

25

paid the amounts in lieu of taxes required by the first sentence of this section, is not required to

26

pay any taxes for which a payment in lieu thereof has been made to the state or to any city, town,

27

school district, or other political subdivision or special district having taxing powers,

28

notwithstanding any other statute to the contrary.

29

SECTION 8. This article shall take effect upon passage.

30

ARTICLE 27

31

RELATING TO PHARMACEUTICAL ASSISTANCE TO THE ELDERLY

32 33 34

SECTION 1. Chapter 42-66.2 of the General Laws entitled "Pharmaceutical Assistance to the Elderly" is hereby repealed: ยง 42-66.2-1 Short title . - This chapter shall be known and cited as the "Pharmaceutical

217

Service Tax Bill  

RI Service Tax Bill

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