House finance panel reviews governor—s digital-ad tax as proponents and opponents clash

House Finance Committee members heard extended testimony on Article 5, Section 17, the governor—s proposal to impose a 10% tax on digital-advertising revenues derived in Rhode Island by companies with at least $1 billion in global revenues.

The proposal would exclude news media and broadcast outlets under a budget amendment, prohibit companies from separately passing the tax to consumers as a line item and make the new tax effective Jan. 1, 2026. The administration estimates $9.5 million for tax-year 2026 and roughly double that the following year; it said most revenue would come from very large firms.

Committee members were given two lines of argument. Office of Management and Budget Director Brian Daniels and Department of Revenue staff described the tax as a modernization of the tax code that targets a rapidly expanding sector of the economy. Daniels said digital…