R.I. lawmakers push to end tax on retirement income
Aim to keep more seniors in state
PROVIDENCE — Top lawmakers are pushing to exempt Social Security, pensions, and other retirement income from the state income tax as a way to stop seniors from leaving Rhode Island, though how far legislators are willing to go is unclear.
The state stands to lose $20 million to $40 million annually in revenue from the tax on Social Security and $100 million or so more if other retirement income is also exempted. Even the lawmakers say the state cannot afford that.
They have introduced about a dozen bills so far with different ways to structure a cut, to start a conversation about how the state can help retirees.
Democratic state Representative Robert E. Craven Sr. proposed repealing the tax on all retirement income. He first considered focusing his bill on Social Security but expanded it because not all seniors benefit from the federal program.
‘‘I do not expect the bill will fund that broad of a total exemption,’’ Craven said.
Rhode Island has a projected shortfall of $34.5 million for the current fiscal year, the Rhode Island Public Expenditure Council said last month.
Craven said he would like to see a cut spread across various types of retirement income, with exemptions only up to a capped amount. The gesture would help people see that Rhode Island is headed in the right direction, he said.