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HB 8199

AN ACT RELATING TO TAXATION -- SALES AND USE TAXES -- LIABILITY AND COMPUTATION

2026 Regular Session Introduced by Jon Brien and 2 co-sponsors

Rhode Island offers a two-day sales tax holiday on Aug 8–9, 2026 for nonbusiness retail purchases of tangible goods under $2,500, with specific exemptions and reporting.

05/07/2026 Committee recommended measure be held for further study
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Bill Summary · HB 8199

Summary of HB 8199 (Rhode Island, 2026 Session)

Title

AN ACT RELATING TO TAXATION -- SALES AND USE TAXES -- LIABILITY AND COMPUTATION

Purpose and Intent

This bill establishes a temporary sales tax holiday in Rhode Island for nonbusiness retail purchases of tangible personal property on August 8 and August 9, 2026. The intent is to exempt these transactions from statewide sales tax and related excise collection, with specific exceptions and reporting requirements.

Key Provisions

  • Sales Tax Holiday Dates: August 8, 2026 and August 9, 2026.
  • Tax Status for Tangible Personal Property (Nonbusiness Sales):
    • Sales tax shall not be imposed on nonbusiness retail purchases of tangible personal property.
    • Exceptions: telecommunications, tobacco products, gas, steam, oil, electricity, motor vehicles, motorboats, meals, and any single item priced over $2,500 are not eligible for the exemption.
  • Excise Tax Collection:
    • Vendors shall not add or collect sales excises on eligible purchases during the holiday.
    • The Department of Revenue (DOR) Director shall not require vendors to collect and remit taxes on eligible purchases on those dates.
    • Any excise erroneously collected during the holiday must be remitted to the DOR.
    • The same exemptions and rules do not apply to the listed excluded categories (e.g., electronics above $2,500, etc.).
  • Reporting and Administration:
    • Standard reporting requirements for vendors remain in effect for these dates (e.g., filing returns, etc.).
    • The DOR Director must issue implementation instructions or forms as needed.
  • Revenue Impact Reporting:
    • By December 31, 2026, the DOR Director must certify:
    • The amount of sales tax forgone.
    • Any new revenue raised from personal and corporate income taxes and other sources as a result of this section.
    • A report to the House and Senate Finance Committees detailing the distribution of revenues that would have gone to each fund absent this section.
  • Eligibility Criteria:
    • Eligible transactions must occur on August 8 or August 9, 2026.
    • Transfer of possession or full payment must occur on one of the two days.
    • Prior layaway or earlier transactions do not qualify.
  • Effective Date:
    • The act takes effect upon passage.

Who Is Affected

  • Consumers: Nonbusiness purchasers of tangible personal property on the two holiday dates (with exemptions noted above).
  • Vendors/Retailers: Participants in the sale of tangible personal property must comply with the holiday rules, including narrowed collection of sales taxes and reporting requirements for the two days; must follow DOR guidance.
  • Tax Administration: Rhode Island Department of Revenue (DOR) to provide guidance, oversee implementation, and produce the required revenue impact report.

Procedural and Timeline Aspects

  • Introduced: February 27, 2026.
  • Committee: Referred to House Finance.
  • Scheduled for Hearing/Consideration: May 7, 2026 (Action History indicates a hearing/consideration date).
  • Reporting Deadline: December 31, 2026, for DOR to certify forgone tax revenue and outline new revenue impacts and fund distributions.
  • Sunset/Continuation: The bill does not specify a broader sunset beyond the stated two-day holiday; it is a single-event provision for 2026.

Notable Details

  • The $2,500 price cap on single items ensures high-priced items remain taxable.
  • The two-day window is narrowly defined and limited to nonbusiness (retail) transactions.
  • Telecommunications, tobacco, energy (gas, steam, oil, electricity), motor vehicles, motorboats, meals, and items above $2,500 are excluded from the exemption.
  • The revenue impact is subject to formal certification and reporting to legislative committees.

If you’d like, I can provide a one-page breakdown for policymakers or a side-by-side comparison with Rhode Island’s typical sales tax rules.

Compiled from official sources — confirm details with the bill’s official record.

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