The proposed legislation, known as the "Free Market Zones Act," aims to provide tax incentives for businesses located in designated opportunity zones in Arkansas. Specifically, the bill exempts these businesses from the income tax, corporate franchise tax, and elective pass-through entity tax. The act defines an opportunity zone as a population census tract in Arkansas that has been designated as such under federal law as of January 1, 2019. The bill also includes provisions to amend existing tax codes to incorporate these exemptions and definitions.

Additionally, the bill repeals a previous section of the Arkansas Code that defined opportunity zones in relation to tax liability, thereby updating the legal framework to align with the new definitions and exemptions. The effective date for the provisions outlined in the act is set for tax years beginning on or after January 1, 2025. This legislation is designed to encourage business development in economically disadvantaged areas by reducing the tax burden on qualifying entities.

Statutes affected:
Old version HB1216 V2 - 3-10-2025 11:15 AM: 26-51-460, 26-54-102(b)
Old version HB1216 Original - 1-23-2025 03:02 PM: 26-51-460, 26-54-102(b)
HB 1216: 26-51-460, 26-54-102(b)