40+ Wealthy Homeowners Challenge 'Taylor Swift Tax' Charging $5 per $1,000 on Rhode Island Homes Over $1M

More than 40 Rhode Island homeowners are challenging the state's controversial 'Taylor Swift Tax' after a lawsuit filed in Newport Superior Court argued that the new levy unfairly targets owners of high-value second homes, particularly those who live outside the state.

The lawsuit was filed on Wednesday by Providence-based law firm Hinckley Allen on behalf of the homeowners. The tax took effect on 1 July 2026 and imposes an additional $5 (£3.67) for every $1,000 (£733) of assessed value on second homes worth more than $1 million (£733,000).

Despite its nickname, Taylor Swift is not a party to the legal challenge. The name comes from the singer's status as one of Rhode Island's most prominent part-time residents.

Why the 'Taylor Swift Tax' Is Facing a Legal Challenge

The complaint argues that Rhode Island's selective property tax violates both the US and state constitutions. At the heart of the case is the claim that the law disproportionately affects non-residents who own expensive second homes but cannot vote in Rhode Island elections.

Hinckley Allen argues that the tax has no reasonable connection to the purposes used to justify it.

Supporters of the measure have argued that owners of second homes place demands on municipal services, fail to maintain some properties, contribute to declining neighbourhood values and could potentially be encouraged to rent their homes to help address the state's shortage of low-income housing.

The homeowners' legal team disputes those arguments.

The complaint says second-home owners do not use municipal services in the same way as full-time residents, pointing in particular to the fact that they generally do not send children to local schools. It also argues that many owners maintain their properties and contribute to surrounding property values.

The filing further questions whether encouraging the rental of homes worth more than $1 million (£733,000) would do anything meaningful to address a shortage of affordable housing.

Jerry Petros, chair of Hinckley Allen's Litigation Group and the partner leading the case, said the homeowners were already paying substantial property taxes before the additional charge was introduced.

'These homeowners already pay high property taxes and pay for more than their fair share of our municipal services, and they do so without complaint,' Petros said.

He also argued that many of the targeted homeowners support charities, historic preservation and other causes in Rhode Island. Petros warned that the tax could also encourage some small business owners to leave the state in search of a more favourable business environment.

Homeowners Call the Tax Unfair and Unconstitutional

The political argument behind the lawsuit is particularly focused on who gets to vote on the people imposing the tax.

According to Hinckley Allen, the legislative sponsor of the measure acknowledged during hearings that many of those affected would be non-residents and therefore unable to vote against the lawmakers who supported it.

The complaint quotes the sponsor as saying that 'none of these people can vote against me or any of you because they're nonresidents' before adding that lawmakers 'need to find some money somewhere'.

The plaintiffs have seized on that statement as evidence of what they describe as the law's discriminatory purpose. The complaint says the tax violates one of the fundamental principles of representative government, 'no taxation without representation'.

That argument will now have to be tested in court. The filing does not mean the homeowners have established that the law is unconstitutional, and the state's position is not provided in the source material. The legal challenge is therefore still an allegation rather than a ruling against the tax.

Among the homeowners named in the case is billionaire Charles Royce, who owns the Ocean House in Watch Hill. The property is among the high-value second homes affected by the new measure.

The lawsuit also arrives after Hinckley Allen successfully challenged another Rhode Island law. In Roth v. State of Rhode Island, the firm secured a Superior Court ruling that a separate measure involving shoreline property rights violated the Rhode Island Constitution's separation-of-powers provision and amounted to an unconstitutional taking of private property.