Rhode Island Senate leadership is backing legislation that would exempt the first $100,000 of tangible property from property taxation by municipalities. The tangible tax is currently levied on businesses for property other than real estate, such as equipment, computers and furniture, and rates vary by municipality. The tangible tax rate in Newport is 1.4%, Warwick is 3.7%, and Providence is 5.3%.

According to the Rhode Island Public Expenditure Council, this legislation will result in the elimination of 85% of all tangible tax levied in the state. It is estimated that the $100,000 threshold would eliminate the tax for more than eight out of ten Rhode Island businesses. The remainder would have to pay taxes only on tangible assets that exceed $100,000. If the bill passes the General Assembly, the new law will take effect in fiscal year 2024-2025.