Everyone wants to get the Ocean State’s struggling economy back on track, and there is a wide range of ideas and significant debate about how best to make progress. The Governor has proposed cutting the state’s corporate income tax as a way to move the economy forward.
With a price tag of almost $90 million over five years, the proposed corporate income tax reduction could backfire if public services that businesses rely on are cut as a result of revenue losses. Furthermore, the proposal will do nothing to help the majority of local businesses that do not pay the corporate income tax. Finally, research suggests that corporate tax cuts do little to stimulate economic growth.
If the proposal is enacted, lawmakers need to ensure it is revenue neutral.
Read our issue brief.