Governor Lincoln Chafee’s proposed 2013 budget includes a host of new revenue proposals, specifically new items added to the state’s sales tax. Unlike last year when the Governor proposed new sales tax items directly related to manufacturing, this year’s proposal is much more modest.

 

RIMA is following the debate on the new tax proposal, with particular attention to an item that may impact some members. Specifically, the Governor has called for the inclusion of “Moving, Storage, and Freight Services” to the 7% sales tax. The proposed budget language remains somewhat vague on the implementation of these new taxes, allowing the administrator of the Division of Taxation the ability to promulgate rules and regulations in the event the General Assembly passes the tax language.

 

Under the new category of taxes on “Moving, Storage, and Freight Services,” the following definitions are provided per the North American Industrial Classification System codes:

 

This industry comprises establishments primarily engaged in operating merchandise warehousing and storage facilities. These establishments generally handle goods in containers, such as boxes, barrels, and/or drums, using equipment, such as forklifts, pallets, and racks. They are not specialized in handling bulk products of any particular type, size, or quantity of goods or products.

 

This industry comprises establishments primarily engaged in providing local general freight trucking. General freight establishments handle a wide variety of commodities, generally palletized and transported in a container or van trailer. Local general freight trucking establishments usually provide trucking within a metropolitan area which may cross state lines. Generally the trips are same-day return.

This industry comprises establishments primarily engaged in operating warehousing and storage facilities.

 

 

 

 

While the Governor’s office has not made clear what specifically would be subject to the sales tax under his new “Moving, Storage, and Freight Services” proposal, RIMA will vigorously oppose this legislation as it may impact our members. Hearings on this particular tax item have been scheduled in both the House and the Senate Finance Committees on the following dates:

 

House Finance Committee – Room 35, State House

 

Senate Finance Committee – Room 211, State House