This bill seeks to amend the corporate franchise tax laws in Arkansas by repealing the Arkansas Corporate Franchise Tax Act of 1979 and instituting a new requirement for corporations to file an annual report. The new section, designated as 4-25-111, defines a corporation to include both domestic and foreign entities while excluding certain organizations such as nonprofit corporations and those exempt from federal income tax. The Secretary of State will provide the necessary forms for these annual reports, which must reflect the corporation's condition and status as of the end of the previous fiscal year. Newly formed corporations will be exempt from filing until the following calendar year. The bill also removes references to the franchise tax in various sections and ensures the confidentiality of the information contained in these reports, with specific exceptions.

Additionally, the bill eliminates specific provisions related to the payment structure for corporations without authorized capital stock, including the fixed fee of $300 and the minimum tax requirement of $150 for certain corporations. It clarifies tax obligations for corporations in liquidation and streamlines the filing process for franchise tax reports, introducing penalties for non-compliance, such as a $25 late filing fee and interest on unpaid taxes. The bill also establishes guidelines for the Secretary of State to assist taxpayers in resolving disputes related to franchise taxes and allows for the waiver of penalties under certain circumstances. Importantly, it clarifies that the new provisions apply only to franchise taxes imposed on or after the effective date of the act, ensuring no retroactive impact on existing tax liabilities.

Statutes affected:
HB 1932: 4-27-128(b), 4-27-1601(e), 4-27-1622, 4-20-105(a), 4-27-121(a), 26-54-101, 4-25-111, 4-36-401(a), 4-36-401(b), 4-37-205(a), 4-37-206(a), 4-38-212(f), 19-5-1227(b), 19-6-201(3)