The bill establishes a new chapter, CHAPTER 72, titled "WEALTH TAX," within Title 44 of the General Laws, introducing a one percent (1%) wealth tax on the taxable worldwide wealth of Rhode Island residents, effective January 1, 2026, for taxes due in 2027. It defines essential terms such as "taxable worldwide wealth," "Rhode Island resident," and "intangible assets," and specifies that the tax will be assessed based on a resident's taxable worldwide wealth as of December 31 of the tax year. Provisions are included for individuals who pass away during the tax year, detailing how their taxable wealth will be evaluated as of the date of death, with adjustments for the number of days remaining in the tax year.

The bill outlines filing requirements, stating that each resident owing tax must file a return by April 15th each year, reporting their taxable worldwide wealth for the preceding calendar year. It mandates electronic filing and payment, with provisions for waivers in certain circumstances. Exemptions are provided for up to $25 million of a taxpayer's financial intangible assets, nonfinancial intangible assets, and the worldwide wealth of artificial persons, among others.

Additionally, the legislation addresses relief provisions for individuals facing tax deficiencies, including the burden of proof for asset allocation between spouses or domestic partners. It prohibits relief for taxes on wealth derived from "disqualified assets," defined as assets transferred between spouses or partners to evade tax. The bill imposes penalties for substantial understatements in wealth tax valuations, with specific thresholds for gross wealth tax valuation misstatements and substantial wealth tax valuation understatements.

The department is required to initiate audits of registered taxpayers, starting at ten percent (10%) in 2026, increasing to fifteen percent (15%) in 2027, and twenty percent (20%) by 2028. A severability clause is included to ensure the effectiveness of the chapter if any provision is deemed invalid.