The bill amends Rhode Island's tax laws, specifically targeting the Business Corporation Tax and personal income tax. It introduces a new tax rate of seven percent (7.0%) on net income for corporations, reduced from nine percent (9%), effective for tax years beginning on or after January 1, 2015. Additionally, a minimum tax of four hundred dollars ($400) is established for corporations starting from tax years beginning on or after January 1, 2017. A significant insertion in the bill allows employers to receive a tax credit for contributions to an eligible employee’s ABLE account, capped at two thousand dollars ($2,000) per employee, per year. The bill also clarifies the definition of "Rhode Island taxable income" and maintains existing tax rates for various income brackets while ensuring alignment with federal tax regulations.

Moreover, the bill proposes a tiered tax rate system for personal income tax, with rates ranging from 3.75% for incomes not exceeding $2,150 to 9.90% for incomes over $10,450, and includes provisions for inflation adjustments. It establishes specific standard deduction amounts based on filing status, with reductions for higher-income taxpayers and annual inflation adjustments. The bill also phases out exemption amounts for taxpayers with alternative minimum taxable income exceeding set thresholds, which will be adjusted for inflation. Additionally, it introduces various tax credits, including a refundable earned-income credit, and mandates the tax administrator to revise the tax code every three years to reflect economic conditions. Overall, the bill aims to modernize the tax structure, enhance tax credits, and streamline tax obligations for both corporations and individuals.