Sales Tax Exemption
Tax-Exempt small issue bonds may be eligible for state sales tax exemption on building materials which can be significant for projects involving new construction. As a result of a 2007 legislative mandate, the sales tax exempt program now requires 3 key components: 1) review and approval of the general assembly, 2) review and approval of an economic impact analysis and 3) the creation of 100 identified new jobs within a 3-year period. In accordance with the Fiscal Year 2007 Budget of the State of Rhode Island, as passed by the Legislature and signed into law by the Governor, at Article 30, Section 23, the Rhode Island General Law §45-37-1-9.1 "The Rhode Island Industrial Facilities Corporation Act" "Exemption from Taxation" was amended. To comply with this amendment, applicants seeking RI Sales Tax Exemption must submit an Economic Impact Application for review and approval of the RIEDC. Upon successful approval, the information contained therein, along with the completed Rhode Island Industrial Facilities Corporation Revenue Bond Financing Application, including all application attachments, will be provided to the Rhode Island General Assembly for review. The following is required per §45-37-1-9.1:
- A brief description of the "legal entity" to receive the benefit.
- A brief description of the scope of the project and its location (address).
- Number of new FTE jobs (100 job minimum required over 3 year period).
- Salary range and total payroll for jobs within bands of approximately $10,000.
- Summary of major benefits provided to employees e.g. health, retirement.
- Total cost of the project with a breakdown for the cost of construction, furniture, fixtures, and equipment.
- Amount of bond issuance requested
- Value of any of the equipment that is already exempt from sales tax e.g. pollution control equipment, manufacturing equipment, etc.
- The description of any plan or process intended to stimulate hiring from the host community, training of employees or potential employees and outreach to minority job applicants and minority businesses.