PROVIDENCE, R.I. (WPRI) — Rhode Island lawmakers are considering legislation that would impose a $2 tax on tickets at larger event venues in the state.
The legislation, sponsored by Rep. Rebecca Kislak, was proposed with Providence in mind, but could apply to any city or town if it’s approved. As written, it would apply to venues that seat 800 people or more.
Kislak introduced the legislation on behalf of the Providence City Council, which is working on a tax and spending plan put forth by Mayor Brett Smiley, who described this year’s budget as “exceptionally difficult to balance.”
“I think every city and town increasingly is facing difficulties in over-reliance on property tax as our main workhorse for how we can do our business,” said Providence City Council President Rachel Miller, who spoke in support of the legislation at Thursday’s hearing before the House Finance Committee.
Miller said the ticket tax would generate $3 million in revenue for the city, which would in turn provide property tax relief to residents.
“I think it is a minor surcharge, right?” Miller said. “For someone who is paying $50, they will pay $52. I do not think that dissuades anyone from being part of the arts scene we support and love in our city.”
But hospitality groups and managers at venues like the Veterans Memorial Auditorium (The VETS) and the Providence Performing Arts Center (PPAC) disagree.
“I think this tax would be the straw that breaks the camel’s back,” said Rich Lupo, who founded Lupo’s Heartbreak Hotel, which is now known as The Strand.
Those opposed to the tax argue that it would burden consumers who are already dealing with high prices and inflation. Opponents also believe it will drive event promoters and larger performing acts away from the state.
“This loss would not only reduce the number of events hosted at PPAC and other local venues, but also diminish economic impact when shows bypass Rhode Island,” said Alan Chille, PPAC’s general manager. “It’s not just venues like ours that suffer. Hotels and restaurants lose critical revenue.”
“We do a lot more than large commercial shows,” added Dan Schwartz, general manager of The VETS. “This bill is also targeting the dance recitals, the community events we host, the religious events, nonprofits that are looking for a venue to host a fundraiser or an event.”
At the Amica Mutual Pavillion, general manager Lawrence Lepore said their two main tenants — the Providence Bruins and Providence College Friars — have contracts that forbid additional taxes, meaning the venue would be forced to absorb it.
“We would go from a small surplus every year to a deficit,” Lepore said.
The legislation, if passed, wouldn’t mandate the tax. Instead, it would give cities and towns the option to impose it if they so choose.
Some lawmakers urged the venue operators to find a way to make it work.
“You’ve got to understand, you’re in the city,” said Providence Rep. Raymond Hull. “The city needs your help.”
No votes were taken on the legislation, which was held for further study.
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