Rhode Island’s Taylor Swift Tax sparks debate

Rhode Island’s proposed new budget has been contentious, especially a provision informally known as the ‘Taylor Swift tax’ that aims at second and seasonal homes. Strong opposition came from the Rhode Island Association of Realtors, who cautioned against the negative impacts on both buyers and sellers in the housing market.

What is the Taylor Swift tax in Rhode Island?

The Taylor Swift tax would be a levy on secondary homes worth more than $1 million that are left unoccupied for longer than half a year. The yearly charge would be £2.50 per £500 of value in excess of the £1 million level. As an illustration, a £2.5 million property left empty for more than six months might face an extra £7,500 in annual taxes. Taylor Swift’s own £17.75 million Westerly Mansion, bought back in 2013 and notoriously the subject of a song on her Folklore album, might be subject to an additional £136,000 of taxes annually.

The budget also calls for a substantial hike in the conveyance tax, which is paid by sellers at the close of sale. The tax would increase by 63 percent, from £2.30 to £3.75 per £500 of value. For a typical house with a selling price of £492,939 in Rhode Island, this would increase the tax from about £2,200 to £3,700.

House Speaker Joe Shekarchi also supported the proposals, saying that difficult choices had to be made to tackle the health care crisis in the state and invest in primary care and Medicaid. He opines that raising costs on expensive second homes is fairer than placing a burden on hardworking Rhode Island families.

Though the Rhode Island House of Representatives approved the budget with these proposals, they are still awaiting State Senate assent. Assuming it is passed, the Taylor Swift tax would be effective in July 2026. Owner of numerous upscale residences, though not in Rhode Island, Dave Portnoy also spoke out against the tax publicly, worried that similar legislation would be implemented in his Massachusetts and New York residences.

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