This bill amends the sales and use tax laws in Arkansas to introduce a reduced tax rate for natural gas, electricity, and coal used by data centers, in addition to manufacturers. Specifically, it establishes a zero percent (0%) tax rate on these utilities when sold to either manufacturers for direct use in manufacturing processes or to data centers. The bill also clarifies that while these sales are exempt from the gross receipts tax, they remain subject to certain excise taxes as outlined in the Arkansas Constitution. Furthermore, the definition of "data center" is provided, distinguishing it from facilities used for cryptocurrency operations.

Additionally, the bill includes an emergency clause, emphasizing the urgency of attracting the data center industry to Arkansas by providing economic incentives. This urgency is based on the industry's reliance on electric utility costs and the need for timely support for economic development projects. The act will take effect immediately upon approval by the Governor or under specified conditions if not vetoed. Overall, the bill aims to enhance Arkansas's competitiveness in attracting data centers by reducing their operational costs related to energy consumption.