Mandates that any surplus state tax revenue received in any fiscal year would be refunded to the taxpayers of this state on a proportional basis in relation to the personal income tax liability incurred by the taxpayers in that fiscal year.

Rhode Island Surplus Funds Tax Credit Act: Plain-English Summary

This bill would require Rhode Island to return extra tax money to residents whenever the state collects more revenue than it needs in a given year. Specifically, if the state takes in more tax dollars than it has budgeted to spend, that leftover amount — called a "surplus" — would automatically be sent back to taxpayers rather than kept by the government or redirected to other purposes.

The refunds would be distributed proportionally based on how much each person paid in Rhode Island personal income taxes that year. This means people who paid more in state income taxes would receive a larger refund, while those who paid less would receive a smaller one. Residents who did not pay any state income tax in that year would not receive a refund under this system.

This bill would primarily affect Rhode Island residents who file and pay state personal income taxes. It would also have a significant impact on how state government manages its finances, since it would restrict the state's ability to hold onto or spend surplus revenue — something lawmakers currently have broad discretion to decide on a year-by-year basis. The bill has been introduced and referred to the Senate Finance Committee, where it will be reviewed before any further action is taken.