This bill proposes a reduction in the statewide sales tax rate by one-eighth percent to alleviate the surplus funds collected from Arkansas taxpayers. The General Assembly recognizes that Arkansas has one of the highest combined state and local sales tax rates in the nation, attributing this to the state levying more sales tax than necessary to fund the Property Tax Relief Trust Fund, which has a growing balance. The bill aims to provide tax relief for all Arkansans.

To implement this reduction, the bill amends Arkansas Code sections related to additional sales and use taxes levied to fund property tax relief. Specifically, it changes the additional excise tax rate from one-half percent (0.5%) to three-eighths percent (3/8%) for taxable sales of property and services, as well as for tangible personal property and specified digital products. The effective date for these changes will be the first day of the calendar quarter following the act's effective date.

Statutes affected:
SB 289: 26-52-302(c), 26-53-107(c)