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. It adds new provisions to Arkansas Code 26-52-402 and 26-53-114, defining machinery and equipment that mechanically recycle post-use materials generated directly from manufacturing operations. The bill outlines the criteria for what constitutes a closed-loop circular process, mechanically recycling, and post-use materials, ensuring that these materials are reclaimed and converted into recognized components of finished products without being mixed with other waste.

Additionally, the bill specifies that the exemptions apply to machinery and equipment used for identifying, gathering, transporting, storing, and converting post-use materials into raw materials or finished products. The effective date for these amendments is set for the first day of the calendar quarter following the act's approval. This legislation aims to promote recycling and sustainability within the manufacturing sector by providing tax incentives for companies that engage in environmentally responsible practices.

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