Working on Tax Reform in Rhode Island

Rhode Island Governor Don Carcieri last week announced the formation of a Tax Policy Workgroup to consider fundamental changes to the Ocean State 's tax system. While the group has been charged with devising changes that promote "equity, efficiency, predictability, competitiveness, and transparency" - laudable goals all - the Governor's comments regarding the group's aims suggest he may favor one particular outcome over others. In the Governor's view, " Rhode Island cannot prosper if its tax policies hinder the creation of jobs and are a disincentive to investment. Unfortunately, [Rhode Island is] now at a competitive disadvantage with many of the other states in New England, including Massachusetts and Connecticut. That needs to change." In light of the fiscal woes now confronting Rhode Island and the regressive legacy of past tax cuts, changes are clearly needed, but will they be the "business-friendly" sort that the Governor seems to have in mind or will they help to produce the revenue state government needs in a fair and sustainable fashion?