One of Rhode Island’s top lawmakers says he is making it a priority to exempt retirement benefits from the state income tax.
House Speaker Nicholas Mattiello has proposed a bill that would exempt Social Security, pensions and other retirement benefits from being taxed as income.
Rep. Mattiello isn’t alone: a similar bill was introduced on Thursday by Rep. Robert Craven.
More details on both bills from the Associated Press:
House Speaker Nicholas Mattiello has said his top priority this legislative session is exempting the benefits from the income tax, because taxing benefits drives people out of Rhode Island and the state needs to provide incentives for them to stay to help the economy.
He has said the cut could cost the state $20 million to $40 million annually.
Rep. Robert Craven, a North Kingstown Democrat, introduced the legislation Thursday, however his bill differs from Mattiello’s vision in that he wants broader tax reform.
“Pensions, disability benefits and other private pension plans that we would at least like to consider, but the main goal is to exempt social security from the income tax,” said Craven.
Craven said if the bill were to pass it would save fixed-income Rhode Islanders several thousand dollars a year.
Mattiello says Craven’s bill is too broad and may have to be trimmed back.
For a breakdown of Rhode Island taxes, click here.
Photo credit: “Flag-map of Rhode Island” by Darwinek – self-made using Image:Flag of Rhode Island.svg and Image:USA Rhode Island location map.svg. Licensed under CC BY-SA 3.0 via Wikimedia Commons – http://commons.wikimedia.org/wiki/File:Flag-map_of_Rhode_Island.svg#mediaviewer/File:Flag-map_of_Rhode_Island.svg
