Rhode Island State Tax Guide

Rhode Island state tax rates and rules for income, sales, property, fuel, cigarette, and other taxes that impact residents.

picture of Rhode Island state flag on pole against golden sky
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Rhode Island state tax: Overview

Rhode Island state tax is high where property taxes are concerned. The higher-than-average tax rate and home values (compared to other states) can drive up tax bills. However, the sales tax rate in Rhode Island is reasonable, and income tax rates are fairly low compared to many other states, especially for taxpayers with higher incomes.

[Data for this state tax guide was gathered from a number of sources including the Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.] 

Rhode island income taxes

picture of skyline in Providence, Rhode Island

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Rhode Island income tax range

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Up to $73,4503.75%
$73,450 to $166,9504.75%
More than $166,9505.99%

Rhode Island tax on retirement income: Military and Railroad Retirement benefits are tax-exempt. Social Security retirement benefits are exempt for retirees with a federal adjusted gross income (AGI) below the income thresholds set by the state.

Taxpayers who have reached full retirement age can exclude up to $20,000 of income ($40,000 for joint filers) from annuities and pensions (excluding IRAs). 

Rhode Island sales tax

Rhode Island's state sales tax rate is 7%. Localities do not impose additional sales taxes, according to the Tax Foundation.

  • Groceries are tax-exempt.
  • Clothing less than $250 is tax-exempt.
  • Prescription drugs are tax-exempt.
  • Women's menstrual products are tax-exempt.
  • Diapers are tax-exempt.

How much are Rhode Island property taxes?

little model house on a table

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In Rhode Island, the average effective property tax rate is 1.53%, which can result in costly tax bills, especially considering high home values in the state (when compared to other states).

Rhode Island Property Tax Breaks for Retirees

Cities and towns in Rhode Island can offer property tax credits to eligible homeowners. For example, South Kingstown offers a property tax credit of up to $2,472 to retirees age 65 and older that meet the following criteria.

  • Homeowners must have owned and resided at a property in South Kingston for the past five years.
  • Household income must fall below specified income limits to qualify.

Property tax credit amounts and criteria may vary from town to town. Retirees in Rhode Island should check with the jurisdiction where they live for more information about available tax credits.

Rhode Island gas taxes (motor fuel)

Gasoline: $0.37 per gallon.

Diesel: $0.37 per gallon.

Rhode Island taxes on alcohol and tobacco

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Cigarettes$4.25 per pack
Other tobacco products80% of wholesale price
Beer$0.10 per gallon
Wine$1.40 per gallon
Liquor$5.40 per gallon

Rhode Island estate and inheritance taxes

Rhode Island doesn't have an inheritance tax, but the state has an estate tax. Only estates valued at more than $1,733,264 are subject to the tax. Estate tax rates in Rhode Island range from 0.8% to 16%.

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Katelyn Washington
Tax Writer

Katelyn has more than 6 years’ experience working in tax and finance. While she specializes in tax content, Katelyn has also written for digital publications on topics including insurance, retirement and financial planning and has had financial advice commissioned by national print publications. She believes that knowledge is the key to success and enjoys helping others reach their goals by providing content that educates and informs.