State of Rhode Island - Division of Taxation
Sales and Use Tax
Regulation SU 87-52
The sale of gift certificates is not taxable, but when the owner of a gift certificate receives tangible personal property by use of such a certificate, or a part thereof, the transaction is a sale and taxable as such. For example, if the owner of a gift certificate valued at $100 purchases a $25 item, tax computed on $25 must be collected by the retailer and remitted to the Tax Administrator.
R. GARY CLARK
DATE: May 1, 1987