In a recent interview, Rhode Island Speaker Shekarchi addressed the state’s projected budget deficit of $300-330 million. He stated that “everything is on the table,” including potential tax hikes and spending cuts.
While spending reductions are considered an optimal solution, lawmakers in Rhode Island are considering revisiting legislation to raise income tax rates. In the previous session, several bills aimed at adding new income tax brackets and creating an income tax surcharge were introduced but did not advance. These proposals are expected to be refiled in the current legislative session.
The National Federation of Independent Business (NFIB) testified against these bills last year, arguing that they would effectively increase taxes for many small businesses that file taxes as pass-through entities. This includes S-corporations, LLCs, and partnerships whose profits contribute to job creation and economic growth.
The NFIB urges individuals to educate lawmakers about how income tax increases can impact small businesses. They encourage using their Action Alert to contact elected officials regarding this issue.
