Archambault Co-sponsors Bill Reducing Minimum Corporate Tax

Rep. James N. McLaughlin (D –Dist. 57, Cumberland, Central Falls) and Sen. William A. Walaska (D – Dist. 30, Warwick) are sponsoring legislation (2013-H 5030,2013-S 0088) that would reduce the state’s minimum tax for corporations from $500 to $250.

Stephen R. Archambault (D – Dist. 22, Smithfield, North Providence, Johnston) has co-sponsored the bill.

Under the state’s existing tax structure, Rhode Island businesses face a minimum $500 per year corporate income tax payment.

“If this legislation is passed, it will give Rhode Island a strong competitive advantage overMassachusetts and other states,” Representative McLaughlin said. “Our smaller businesses are getting slammed with this $500 minimum and it’s placing a barrier in front of potential start-ups. Rebuilding our fiscal health has been a slow process, and I’m hoping something like this will provide faster relief to the people in this state.”

Sen. William A. Walaska said his constituents have spoken to him about reducing the minimum corporate tax on various occasions. A lower minimum corporate tax could drive more businesses to open up shop and expand in Rhode Island, he said.

“Many of my constituents think the $500 minimum corporation tax is unfair, especially while the state is still in economic recovery,” Senator Walaska said. “Looking at the big picture, it’s also just another area in which Rhode Island is at a disadvantage compared to our neighboring states. We keep hearing that we’re not business friendly. It’s time we take more measures to rectify that.”

Both Speaker of the House Gordon D. Fox and President of the Senate M. Teresa Paiva Weed have expressed a strong interest in looking at the overall corporate tax rate to make Rhode Island more competitive with its neighbors. Governor Lincoln D. Chafee expressed his full support for lowering the corporate tax rate from 9 percent to 7 percent in his State of the State address last week.

The bill’s cosponsors in the House include Representatives Spencer E. Dickinson (D –

Dist. 35, South Kingstown), Robert D. Phillips (D – Dist. 51, Woonsocket, Cumberland), Lisa P. Tomasso (D – Dist. 29, Coventry, West Greenwich) and Marvin L. Abney (D – Dist. 73,Newport, Middletown). It has been referred to the House Committee on Finance.

Cosponsors of the Senate bill include Senators David E. Bates (R – Dist. 22, Barrington,Bristol, East Providence), Frank S. Lombardi (D – Dist. 26, Cranston) and Stephen R. Archambault (D – Dist. 22, Smithfield, North Providence, Johnston). It has been referred to the Senate Finance Committee.