This bill aims to reduce income taxes for individuals, trusts, estates, and corporations in Arkansas, effective for tax years beginning on or after January 1, 2024. Key changes include increasing the income threshold for individuals, trusts, and estates from $87,000 to $89,600, and adjusting the tax rates across various income brackets. For example, the tax rate for income exceeding $89,600 is reduced from 4.4% to 3.9%. Additionally, the bill modifies the tax structure for corporations, lowering the tax rate on net income exceeding $11,000 from 4.8% to 4.3%.

Furthermore, the bill mandates a transfer of $290 million from the General Revenue Allotment Reserve Fund to the Arkansas Reserve Fund Set-Aside on July 2, 2024, to ensure the efficient operation of state government. An emergency clause is included, stating that the act is necessary for the financial stability of the state and to provide adequate time for taxpayers and employers to adapt to the changes. The act will take effect immediately upon approval by the Governor or after the expiration of the veto period.

Statutes affected:
HB 1001: 26-51-201(a), 26-51-205(a), 26-51-205(b)
Act 4: 26-51-201(a), 26-51-205(a), 26-51-205(b)