The proposed bill amends Chapter 44-30 of the General Laws regarding "Personal Income Tax" by introducing a new section, 44-30-12.1, which establishes a tax exemption for the sale of Bitcoin in Rhode Island. Under this new provision, any sale of Bitcoin by individuals or businesses based in the state will be exempt from state taxation if the total value of sales is less than one thousand dollars ($1,000) per day, with a limit of ten sales within a thirty-day cycle. The bill defines key terms related to Bitcoin transactions, including "Bitcoin," "Business," "Individual," and "Market value," and specifies that the market value of Bitcoin at the time of each transaction will determine the value of sales.

Additionally, the bill clarifies that any gains from Bitcoin sales exceeding the daily threshold will be subject to state income and capital gains tax, while exempt gains will not be included in the income calculations for capital gains tax purposes. The Department of Business Regulation is tasked with creating rules for implementing this exemption, including verifying Bitcoin's market value, while the Department of Revenue will ensure compliance. The act will take effect upon passage, and it is important to note that the exemption applies only to state taxation and does not affect federal tax obligations.