Today RIPEC released its annual report: How Rhode Island Revenues Compare, which provides details on state and local government revenue sources from fiscal year 2010, the latest year for which national data are available. The publication compares Rhode Island’s fiscal system with those of the other 49 states and the national average using data released by the US Census Bureau on September 25, 2010. To see the full report, click here.
Despite declines in most broad-based taxes, state and local governments in Rhode Island collected $12.0 billion in FY 2010, approximately $4.0 billion, or 60.0 percent, higher than FY 2009 revenues. Nationally, state and local FY 2010 revenue collections of $3.2 trillion were $1.1 trillion (53.5 percent) more than FY 2009 collections. A significant contributor of the increase, both in Rhode Island and nationally, was related to growth in insurance trust fund revenues (e.g. public employee retirement systems, unemployment compensation, state workers’ compensation systems), which increased by $3.8 billion in Rhode Island ($1.0 trillion nationally). Similarly, intergovernmental revenue increased, partially as a result of national stimulus funds from the American Recovery and Reinvestment Act. In Rhode Island, total revenues were also buoyed by increases in property taxes, charges and miscellaneous revenues, and other taxes (including corporate income taxes).
Rhode Island’s FY 2010 tax burden remains among the highest in the country, ranking 13th highest both as a share of personal income and on a per capita basis. In FY 2009, the state’s tax burden was 11th highest per $1,000 of personal income and 13th highest per capita. Although Rhode Island moved down in the national rankings when tax burden was measured as a share of personal income, year-over-year tax collections increased from $109.84 per $1,000 of personal income to $111.34 per $1,000 of personal income.
By either measure – per $1,000 of personal income or per capita – Rhode Island’s total tax burden continues to be driven by the state’s high property tax collections, which now account for over 45 percent of all tax collections in the Ocean State. Although Rhode Island ranked 13th highest for total tax collections as a share of personal income, the state’s tax collections were lower than the national average for all taxes with the exception of the property tax. Similarly, the state’s per capita tax collections were, in general, lower than, or similar to, the national average for all but the property tax. Of note, excluding property tax collections, FY 2010 tax revenues in Rhode Island were on par with FY 2006 collections.