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SB 2449

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

2026 Regular Session Introduced by Jonathon Acosta and 9 co-sponsors

Rhode Island SB 2449 expands and clarifies sales tax exemptions, notably adding an energy storage systems exemption and broadening relief for medical, educational, farming, recycli

05/21/2026 Committee recommended measure be held for further study
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Bill Summary · SB 2449

Overview

SB 2449, introduced in Rhode Island in the 2026 session, amends the sales and use tax liability and computation provisions. The bill primarily adds specific exemptions and clarifies existing ones, with a stated short-term effective date: upon passage. The accompanying explanation notes an additional targeted exemption for energy storage systems.

Main purpose and intent

  • Expand and clarify exemptions from Rhode Island sales and use taxes.
  • Align exemptions with policy goals such as supporting energy storage, medical needs, education, farming, recycling, and other public-interest activities.
  • Create and/or confirm carve-outs that agencies and taxpayers can rely on when planning purchases.

Key provisions and changes

  • Exemptions (non-exhaustive list; numbers refer to the bill’s enumeration):

    • Energy storage systems: The explanation emphasizes an exemption for energy storage systems (per the EXPLANATION section), aligning with the energy storage definition in § 39-33-1.
    • Newspapers, school meals, and various charitable/educational organizations.
    • Containers, certain food items, and medicines/drugs (with distinctions between prescription and OTC.
    • Provisions for manufacturing inputs when used to manufacture resale products.
    • State and political subdivisions, including redevelopment agencies.
    • Gasoline, fuels for aircraft propulsion.
    • Automotive-related exemptions for nonresidents and trade-ins, with record-keeping and regulatory conditions.
    • Industrial/manufacturing-specific exemptions (manufacturing machinery and equipment; process of manufacturing language preserved).
    • Educational institutions’ living quarters, textbooks, and certain on-site educational activities.
    • Agricultural and farming-related exemptions (farm equipment, farm structure construction materials, diesel emission tech, feed, seeds/plants for growing food).
    • Agricultural and veterinary-related exemptions (horse feed, animal-related items).
    • Retail items like clothing (with the ongoing reference to the pre-2012 expansion and potential restoration to unlimited exemption upon federal remote seller collection standards).
    • Specialized categories: prosthetics and mobility devices, burial and funeral-related items, boats/vessels for nonresidents, non-motorized recreational vehicles, and aircraft parts.
    • Renewable energy products (solar, geothermal, wind, and related components) with a detailed list of what is included and what is excluded.
    • Hazardous waste processing equipment used in recycling, with environmental management certification requirements.
    • Promotional literature for boat manufacturers shipped out of state, and product display materials for jewelry shipped out of state.
    • Breast pump supplies and feminine hygiene products (explicitly enumerated).
    • Certain veteran-related vehicle exemptions and adaptive equipment.

  • Administrative and compliance features:

    • Tax administrator authority to require record-keeping for exemptions (e.g., nonresident motor vehicle and non-motorized recreational vehicle transactions).
    • Provisions governing use tax treatment for certain out-of-state buyers and trade-ins.
    • Clarifications on what constitutes “returnable” vs. “non-returnable” containers for exemption purposes (with earlier items referencing placement into manufacturing or resale streams).
    • Expiration provisions for specific exemptions (e.g., sprinkler and fire alarm systems exemption expires 12/31/2008).

  • Effective date: The act takes effect upon passage.

Who would be affected

  • Consumers and businesses purchasing taxed goods and services in Rhode Island, particularly:
    • Nonresident vehicle and boat buyers.
    • Farmers, manufacturers, and energy developers adopting energy storage or renewable energy equipment.
    • Educational institutions, hospitals, religious/charitable organizations.
    • Retailers and suppliers dealing with goods that are partially exempt (e.g., clothing, textbooks, medical devices, hunting/fishing equipment).
    • Contractors and suppliers working on environmentally oriented facilities and hazardous waste recycling equipment.
    • Veterans and persons purchasing adaptive equipment.

Procedural and timeline notes

  • Referred to the Senate Finance Committee upon introduction.
  • Scheduled for hearing/consideration as of May 15, 2026.
  • Overall, the bill provides an immediate effective date upon passage, with several exemptions having specific historical contexts or expiration dates referenced within the text.

If you’d like, I can extract a concise bullets-only synopsis or create a side-by-side comparison with current law to highlight all deltas.

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

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