Rhode Island lawmakers have agreed on a new plan that adds extra tax charges to fancy second homes, aiming to help pay for more housing and health care projects. The Rhode Island House of Representatives passed a state budget that asks owners of homes worth more than one million dollars, which sit empty most of the year, to pay a higher fee each year. Some people call this the “Taylor Swift Tax” because it would make singer Taylor Swift pay about $136,000 more each year on her Watch Hill estate.
How the extra fee works
The new rule says every home that sits empty for more than half the year and is worth over one million dollars will pay an extra fee of two dollars and fifty cents on every five hundred dollars of its value above that first million. That means if a home is worth seventeen million dollars, the part over one million—sixteen million—gets charged that extra fee. In Taylor Swift’s case, her property could face a big bill under this plan.
A bigger charge when you sell
The budget also raises the fee you pay when you sell any home. Right now, sellers pay two dollars and thirty cents on each five hundred dollars of sale price. The new plan bumps that to three dollars and seventy-five cents. For a home sold at the state’s average price of about four hundred ninety-three thousand dollars, sellers would pay about three thousand seven hundred dollars, up from around two thousand two hundred dollars.
Who is against it
The Rhode Island Association of Realtors has spoken out against these changes. Its leader, Chris Whitten, called the timing bad because the home market is already tight. He told a local TV station that raising fees now might hurt people trying to buy or sell homes. A media personality who owns homes nearby also warned that other states could copy this idea if it works here, and that could cause more problems for property owners in other places.
Why lawmakers think it is needed
House Speaker Joe Shekarchi said he backed the new charges to help families who are having a hard time finding a place to live or getting health care. He pointed out that extra money from these fees would support projects to build more affordable places to live and give tax breaks to low income families. Right now, Rhode Island has only about a month and a half of homes for sale, which is far below what many experts say is a healthy amount.
What’s next
The plan now moves to the State Senate for a vote. If they agree, it would start in July of next year. Then, anyone who owns a home over a million dollars that stays empty most of the year would pay the higher annual fee, and everyone selling a home would pay more when they close the deal.
Personal insight
I think this approach shows how states look for new ways to raise money when budgets get tight, but it also risks pushing away buyers and sellers at a time when the housing market needs more activity. If lawmakers want more homes to be lived in all year, they might also try offering breaks to people who rent out homes for long periods or who turn them into year-round residences, so that owners see a benefit from helping the community rather than just facing more charges.
Sources: New York Post
