STATE HOUSE — Rep. Jon Brien, an independent representing District 49 in Woonsocket and North Smithfield, has introduced legislation that would create an annual sales tax holiday.
Touted as, “Christmas in July in RI,” the legislation – 2023-H 5805 – would create a sales and use tax holiday for the second Saturday and Sunday in July annually, exempting items below $2,500 from the state’s 7-percent sales tax. The holiday would not apply to sales of telecommunications, tobacco products, gas, steam, oil, electricity or motor vehicles.
“Other states have seen success with sales tax holidays in stimulating their economies,” said Brien. “Christmas in July in RI would be a nice hook to lure in shoppers from nearby states to Rhode Island. Not only is it a great way to give back to businesses in the state, but it would help out others, as well, since July is the perfect time to enjoy the state’s restaurants, beaches and other attractions.”
Several states currently have sales tax holidays, and most jurisdictions use the holiday to exempt clothing and back-to-school supplies from sales tax. Since clothing is already sales tax-exempt in Rhode Island, Brien’s legislation would be modeled on the Massachusetts tax holiday, which currently exempts all taxable items below $2,500.
The legislation, which is cosponsored by Democratic Reps. Arthur Corvese; Jacquelyn Baginski; Patricia Serpa; Edward Cardillo and Robert Phillips, along with House Minority Leader Michael Chippendale of District 40 in Foster, Glocester and Coventry and Republican Rep. Brian Newberry of District 48 in North Smithfield and Burrillville, has been referred to the House Finance Committee.