The bill amends Section 44-18-7.1 of the General Laws in Chapter 44-18, which pertains to "Sales and Use Taxes Liability and Computation," by providing new definitions and clarifications for terms related to sales and use tax. It expands the definition of "alcoholic beverages" to include beer and malt beverages, details what constitutes a "bundled transaction," and defines the term "de minimis" in the context of bundled transactions. The bill also clarifies terms related to clothing, computers, drugs, and various other categories, such as "protective equipment," "computer software," "delivered electronically," "prewritten computer software," "over-the-counter drug," "grooming and hygiene products," and "prescription." It defines "delivery charges," "direct mail," "durable medical equipment," "food and food ingredients," "prepared food," "candy," "soft drinks," "dietary supplements," and terms related to the hospitality industry. The bill includes insertions and deletions, but the specific text changes are not provided in the summary.

The bill further addresses the taxation of telecommunications and digital products, defining different types of sellers based on their sales volume and tax function systems, such as "Model 1 Seller," "Model 2 Seller," and "Model 3 Seller." It provides detailed definitions for "specified digital products," "transferred electronically," "end user," "permanent," "ancillary services," and various specific telecommunications services. The bill also amends definitions and tax exemptions related to telecommunications services and ancillary services, introducing new categories and clarifying existing ones, such as "Fixed wireless service," "Mobile wireless service," "Prepaid calling service," and "Private communications service." It specifies exemptions from sales and use taxes, including sales beyond the state's constitutional power to tax, newspapers, school meals, containers, and charitable, educational, and religious organizations. The bill includes insertions and deletions to Section 44-18-30, specifying exemptions from sales and use taxes, and clarifies the definition of "Newspaper" while excluding magazines and similar items unless part of a newspaper. It also details exemptions for containers, distinguishing between returnable and non-returnable types, and provides exemptions for charitable, educational, and religious organizations.

Statutes affected:
7277: 44-18-7.1, 44-18-30