Mission Accomplished: Arkansas Adopts Major Tax Reforms Recommended by Task Force

Last Tuesday, April 9, saw Governor Hutchinson's signing ceremony for a pair of bills comprising many of the Tax Reform and Relief Legislative Task Force's recommended reforms: Act 822 (SB576) requires remote seller collection and provides three major business income tax reforms. Act 819 (SB561) adopts several administrative reforms. Coupled with the individual tax cuts of Act 182 enacted earlier this year, this session has paid off with a comprehensive set of reforms that make significant improvements while fitting sustainably within the state's fiscal and political constraints. [More]

Arkansas Tax Legislation "March Madness": Administrative Changes, an Independent Tax Appeal Tribunal, and More

With March more than halfway over, a surprising amount of tax legislation is still on the agenda for the General Assembly. In addition to the recently-filed major business tax reforms of SB 576, other significant tax bills that have been introduced include: (1) the Tax Reform Task Force administrative reforms (SB 561), an independent Tax Appeals Commission (SB 560), and a low-income tax cut paid for by taxes on cigarettes and e-cigarettes (SB 571). The state government transformation (reorganization) bill (HB 1763) also has implications for taxpayers. And we have not yet seen an Internal Revenue Code conformity bill. Interested stakeholders need to monitor the unpredictable weeks ahead. [More]

Major Arkansas Tax Reform Bill Introduced: Remote Seller Collection, Apportionment, and NOLs

A major tax bill was introduced today that, if enacted, will make the Arkansas tax system fairer and much more competitive. Senate Bill 576 (SB 576) includes: (1) sales tax collection by remote sellers and marketplace facilitators; (2) single sales factor apportionment and repeal of the throwback rule; (3) extension of the net operating loss (NOL) carryforward limit from 5 years to 20 years; and (4) substitution of a car wash water use fee for the current sales tax on car washes. These reforms are a culmination of the two-year Tax Reform and Relief Legislative Task Force process and would create a much more favorable tax climate for many Arkansas businesses --particularly manufacturers, retailers, wholesalers, and banks. Interested taxpayers need to get involved to support the bill as it enters into a hurried final weeks of the legislative session. [More]

They Pulled It Off: Tax Reform Task Force Picks Preferred Individual Tax Cuts Plan, Approves Draft Legislation Package, and Adjourns

The Arkansas Tax Reform and Relief Legislative Task Force has concluded its 20 months of proceedings by approving draft legislation for a roughly $400 million tax reform and relief package that should guide the state's tax policy for the next decade. If implemented, it will provide Arkansas with a fairer and more competitive tax system while maintaining the state's fiscal stability. The next step will be to see the proposals through and further refine them as part of the regular legislative process in 2019. [More]

Tax Reform Task Force Recommends Individual Cuts First, then Business Tax Reforms

The Arkansas Tax Reform and Relief Legislative Task Force met again on the morning of November 27 to consider structuring and timing of its recommended policy changes. On the whole, the Task Force seems to be on track to recommend some form of individual income tax cuts then followed by several changes to business taxation aimed to make the state more competitive. Tax triggers would be used to prevent budget shortfalls under this approach, which differs from the incremental biennium-by-biennium changes seemingly preferred by the Governor's Office and the Department of Finance and Administration. The Task Force will vote on its legislative package at its next meeting on December 12. [More]