The bill amends the Consolidated Incentive Act of 2003 to introduce a new "modernization and automation tax credit" aimed at encouraging investment by existing businesses in Arkansas. Key changes include the definition of "project costs," which now allows eligible costs to be incurred within four years or six years for projects qualifying for the new tax credit. The bill also specifies that applications for this tax credit must be submitted before incurring project costs, and only costs incurred after the commission's approval of the application will be eligible. Additionally, the bill outlines requirements for the financial incentive agreement, including project completion timelines and maintaining payroll and employment levels.

Furthermore, the bill establishes that the modernization and automation tax credit is available only to Arkansas businesses that have been operational for at least two years and have incurred a minimum of $25 million in project costs. The credit can be up to 5% of eligible project costs, with a maximum of $2 million that can be claimed in a fiscal year. The legislation also clarifies that this new tax credit cannot be combined with other tax credits for the same project and sets an effective date for the new provisions starting October 1, 2025.

Statutes affected:
Old version HB1935 V2 - 4-8-2025 09:41 AM: 15-4-2703(29), 15-4-2706(c), 15-4-2712(b), 15-4-3501(g)
Old version HB1935 Original - 3-31-2025 04:15 PM: 15-4-2703(29), 15-4-2706(c), 15-4-2712(b), 15-4-3501(g)
HB 1935: 15-4-2703(29), 15-4-2706(c), 15-4-2712(b), 15-4-3501(g)
Act 882: 15-4-2703(29), 15-4-2706(c), 15-4-2712(b), 15-4-3501(g)