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By Rachel Flum, Providence Journal op-ed
Rhode Islanders understand that smart investments lay the foundation for thriving communities today and widely shared prosperity in the future. Investments in our schools set our children on a path to success, investments in health care help working people and their employers to succeed, and investments in infrastructure — roads, bridges, green buildings — help keep our families safe, facilitate commerce, and help to preserve the Ocean State’s abundant natural resources.
Rhode Islanders also understand that you don’t get something for nothing. Recent polling shows that two-thirds of Rhode Island voters support a proposed $250 million bond issue for public school repair and construction. We recognize that children who learn in buildings that are warm, safe, and dry will be better able to get the education needed to thrive, and to fuel the dynamic, responsive, productive economy of the future.
We need to make smart investments to propel the Ocean State down the roadway to success and prosperity. This will be increasingly important as the federal government pursues reforms that make it harder for Rhode Island families to thrive, targeting programs such as the Supplemental Nutrition Assistance Program that 98,000 Rhode Island households depend on to avoid going hungry.
Public structures pave the way for private success. Many Rhode Islanders have flourished as they rely on our roads to transport their goods to market, benefit from legal protections enforced by our courts, leverage public investment in research and development, and employ workers educated in our schools and often trained through public initiatives. Their successes should be acknowledged and celebrated, but so, too, should the role of the public systems that helped them thrive.
The wealthiest Rhode Islanders have benefited enormously from recently enacted federal tax changes. The Institute on Taxation and Economic Policy reported this month that the wealthiest 5 percent of Rhode Island families would receive 45 percent of the total tax cuts in 2018. The Rhode Island tax code as currently structured is upside down — the wealthiest pay a smaller share of their income in state and local taxes than do the rest of Ocean State families. Most Rhode Islanders would agree with asking these families to pay higher taxes to support today’s needs and to make the investments needed to ensure our future prosperity.
State leaders should consider the following three commonsense solutions. Expanding Rhode Island’s income tax by adding new brackets at higher rates, as proposed by bills in the House (H-7886) and Senate (S-2389), would generate $130 million to invest in Rhode Island. Restoring the state’s corporate minimum tax to $500 would add $5.4 million to state revenues, as federal tax changes shift hundreds of millions of dollars into corporate coffers. And further modernizing Rhode Island’s sales tax, by taxing more services and a larger share of online sales, would also generate additional revenues.
Building the brightest future for Rhode Islanders means looking boldly down the road at the future we want to build together, and ensuring we have the necessary resources to get there. Additional revenues raised today help to meet today’s needs, while laying a foundation for future prosperity.
Rachel Flum is the executive director of the Economic Progress Institute.