RI Tax Exemption for Arts

Arts + Business + Media + Tax
July 29, 2013
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A statute that opens with “[t]he downtown area of the city of Providence has been characterized by blighted areas, and dilapidated and abandoned structures” would have to eventually be amended, one would hope anyway. Rhode Island General Law §44-18-30B provides an exemption from sales and use tax for art products. Since its introduction in 1998, the exemption has been limited to areas geographically defined by the kind of property description you’d expect to find in a deed.

For example, part of the Providence bounds currently reads as follows:

Said Providence arts and entertainment district also includes the area beginning at the point of intersection of Acorn Street and Harris Avenue, then turning east onto Atwells Avenue to Service Road 7, then turning southerly onto Service Road 7 to Westminster Street, then turning westerly onto Westminster Street, continuing until Bridgham, then turning south onto Bridgham to Cranston Street, then turning southwesterly onto Cranston Street, then continuing to Messer Street, then turning north onto Messer Street to Westminster Street, turning west onto Westminster Street to US Hwy 6 off ramp, then heading west on US Hwy 6 to Sheridan Street, then heading northeast on Sheridan Street to Aleppo Street, then turning southeast along Aleppo Street to Pelham Street, then heading northeast on Pelham Street to Manton Avenue, then continuing southeast on Manton Avenue until Delaine Street, then heading northeast on Delaine Street until Appleton Street, then continuing northwesterly on Appleton Street until Bowdoin Street, then heading north on Bowdoin Street until Barstow Street, then heading east on Barstow until Valley Street, then heading northeast on Valley Street to Hemlock Street, then turning southeast on Hemlock Street until Promenade Street, then heading east on Promenade Street to Acorn Street, then heading south on Acorn Street to the intersection of Acorn Street and Harris Avenue.

This is changing. Beginning December 1, 2013 the arts district, previously confined to a narrow selection of areas in state, will be expanded statewide. Any sale of a one-of-a-kind original and creative work by a gallery, or by a state resident and owner of a principal place of business in state, and who is determined to have written, composed or executed either solely or jointly such a work, so long as it is sold from the individual’s business located in state, and so long as it would otherwise be subject to tax, is exempt from the 7% sales tax.  Works will include:

  • A book or other writing
  • A play or the performance of said play
  • A musical composition or the performance of said composition
  • A painting, print, photograph or other like picture
  • A sculpture
  • Traditional and fine crafts
  • The creation of a film or the acting within the film
  • The creation of a dance or the performance of the dance
  • Any product generated as a result of any of the above categories

Works will not include any piece or performance created or executed for industry oriented, commercial or related production.

Also, any person storing, using, or otherwise consuming in state any work deemed to be exempt from sales tax is not liable for the use tax on the work.

Note that application for exemption must be made. It’s not automatic.

Finally, and thankfully, the doomsday language in the original version of the statute has been cut.

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