Department of Finance and Administration
Legislative Impact Statement
Bill: HB1001
Bill Subtitle: TO REDUCE THE INCOME TAX LEVIED ON INDIVIDUALS, TRUSTS, ESTATES,
AND CORPORATIONS; TO TRANSFER SURPLUS FUNDS TO THE ARKANSAS RESERVE FUND
SET-ASIDE; AND TO DECLARE AN EMERGENCY.
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Sponsors:
Reps. Eaves, M. Shepherd, Beaty, Ray, Achor, Andrews, Barker, Beck, Bentley, M. Berry, S.
Berry, Breaux, Brooks, K. Brown, M. Brown, Burkes, Joey Carr, Cavenaugh, Cooper, Cozart,
Crawford, Dalby, Duke, Eubanks, Evans, C. Fite, L. Fite, Fortner, Furman, Gazaway, Gonzales,
Gramlich, Haak, Hawk, D. Hodges, G. Hodges, Holcomb, Hollowell, Jean, Johnson, Ladyman,
Long, Lundstrum, Lynch, Maddox, Mayberry, McAlindon, McClure, McCollum, McElroy,
McGrew, McKenzie, McNair, Meeks, Miller, Milligan, J. Moore, K. Moore, Painter, Pearce,
Pilkington, Puryear, R. Scott Richardson, Richmond, Rose, Rye, Schulz, Steimel, Tosh,
Underwood, Unger, Vaught, Walker, Warren, Watson, Wing, Womack, Wooldridge, and Wooten
Sens. Dismang, Boyd, Bryant, Caldwell, Clark, Crowell, Davis, Dees, Dotson, English, Flippo,
Gilmore, Hammer, Hester, Hickey, Hill, Irvin, B. Johnson, M. Johnson, McKee, Payton, Penzo,
Petty, Rice, Stone, Stubblefield, Sullivan, and Wallace
Basic Change:
Individual Income Tax --- Top Rate Reduction to 3.9% in 2024 --- HB1001 amends the income tax
tables contained in § 26-51-201 to reduce the top individual income tax rate in Arkansas to 3.9%
effective for the 2024 and following tax years. The bill also recalculates the bracket adjustments based
on the reduced tax rate to maintain a smooth transition between the standard income table and the
upper income table. For tax year 2024, individuals with net taxable income of more than $89,600 but
less than $92,701 will reduce their income tax due by the appropriate bracket adjustment amount.
The individual income tax tables will be as follows effective for the 2024 and following tax years:
2024 and Following Tax Years
Standard Income Table Upper Income Table
$0 to $5,299 0% $0 to $4,500 2%
$5,300 to $10,599 2% $4,501 + 3.9%
$10,600 to $15,099 3%
$15,100 to $24,999 3.4%
$25,000 to $89,600 3.9%
Corporation Income Tax --- Top Rate Reduction to 4.3% in 2024 --- HB1001 reduces the top
corporation income tax rate imposed on both domestic and foreign corporations to 4.3% for the 2024
and following tax years. The corporation income tax table will be as follows effective for the 2024 and
following tax years:
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6/14/2024 10:34AM 1
 Department of Finance and Administration
Legislative Impact Statement
Bill: HB1001
Bill Subtitle: TO REDUCE THE INCOME TAX LEVIED ON INDIVIDUALS, TRUSTS, ESTATES,
AND CORPORATIONS; TO TRANSFER SURPLUS FUNDS TO THE ARKANSAS RESERVE FUND
SET-ASIDE; AND TO DECLARE AN EMERGENCY.
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2024 and Following Tax Years
$0 to $3,000 1%
$3,001 to $6,000 2%
$6,001 to $11,000 3%
$11,001 + 4.3%
Transfer to Arkansas Reserve Fund Set-Aside --- HB1001 directs the Chief Fiscal Officer to transfer
$290,000,000 from the General Revenue Allotment Reserve Fund to the Arkansas Reserve Fund
Set-Aside on July 2, 2024.
Fiscal Impact:
FY2025 - $483,500,000 General Revenue Reduction
FY2026 and after - $322,300,000 General Revenue Reduction
Revenue Impact of Each Tax Change
FY2025 FY2026
Individual Income Tax
Reduction to 3.9% (2024) $384,200,000 $256,100,000
Corporation Income Tax
Reduction to 4.3% (2024) $99,300,000 $66,200,000
Total $483,500,000 $322,300,000
Taxpayer Impact:
Individual and corporation income taxpayers will receive a reduction in their tax liability.
Approximately 1.1 million individual income taxpayers with net taxable income greater than $25,000
would receive a tax reduction. Approximately 7,800 corporations with net taxable income greater than
$11,000 would receive a tax reduction.
Resources Required:
Computer programs, tax forms, and instructions will need to be updated.
Time Required:
Adequate time is provided for implementation.
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6/14/2024 10:34AM 2
 Department of Finance and Administration
Legislative Impact Statement
Bill: HB1001
Bill Subtitle: TO REDUCE THE INCOME TAX LEVIED ON INDIVIDUALS, TRUSTS, ESTATES,
AND CORPORATIONS; TO TRANSFER SURPLUS FUNDS TO THE ARKANSAS RESERVE FUND
SET-ASIDE; AND TO DECLARE AN EMERGENCY.
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Procedural Changes:
Department employees will need to be educated as well as the tax community.
Other Comments:
None.
Legal Analysis:
None.
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6/14/2024 10:34AM 3


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)