This bill amends the sales and use tax exemptions for certain machinery and equipment used in manufacturing, specifically introducing exemptions for machinery and equipment utilized in closed-loop recycling processes. The amendments to Arkansas Code 26-52-402 and 26-53-114 include new definitions and criteria for what constitutes machinery and equipment eligible for these exemptions. The bill specifies that machinery used to mechanically recycle post-use materials in a closed-loop circular process will be exempt, detailing the types of machinery involved in identifying, gathering, transporting, and converting these materials into usable products.

Additionally, the bill defines key terms such as "closed-loop circular process," "mechanically recycle," and "post-use material," establishing clear guidelines for what qualifies for the exemption. The effective date for these changes is set for the first day of the calendar quarter following the act's approval. Overall, the bill aims to promote recycling and sustainability within the manufacturing sector by providing tax incentives for companies that engage in closed-loop recycling practices.

Statutes affected:
HB 1702: 26-52-402(c), 26-53-114(c)