There is talk that some in state government are considering the implementation of a gross receipts tax.  If implemented, the tax would apply to the gross revenue earned by a business, rather than just it's net income.  Studies anticipate bringing in approximately $511 million dollars if a 1% tax were implemented with a $600,000 exemption.  I think this idea has potential, but only if it is the centerpiece of sweeping change

     Rhode Island currently generates $823 million from the sales tax, $112 million from the corporate tax, and $970 million from the income tax, for a grand total of $1.9 billion dollars.  Here's a bold idea: Why not impose a 3.5% gross receipts tax, which would generate $1.78 billion, then cut another $100 million of waste.  This would allow the elimination of the income, sales, and corporate taxes in their entirety.  It would likely lead to more growth and economic activity in the state, plus the rate could be lowered slightly once the economy rebounds, which would further help local businesses.

     A gross receipts tax could be an excellent way to restructure the state's taxes, but we must be careful not to simply switch the way taxes are being collected.  We need to reduce the size of government, and increase the number of people who are paying taxes (assuring that each person pays less).  This will lead to economic growth and prosperity.  Now let's see if anyone has the nerve to try it.