An act TO CUT THE STATEWIDE SALES TAX RATE BY ONE- 10 EIGHTH PERCENT TO REDUCE THE SURPLUS FUNDS COLLECTED 11 FROM ARKANSAS TAXPAYERS, the official text

Stricken language would be deleted from and underlined language would be added to present law.

1 State of Arkansas      As Engrossed: S2/27/25
2 95th General Assembly
                               A Bill

3 Regular Session, 2025                                            SENATE BILL 289

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5 By: Senator J. Dotson

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8                        For An Act To Be Entitled

9              AN ACT TO CUT THE STATEWIDE SALES TAX RATE BY ONE-

10             EIGHTH PERCENT TO REDUCE THE SURPLUS FUNDS COLLECTED

11             FROM ARKANSAS TAXPAYERS; TO AMEND THE SALES AND USE

12             TAX RATE; AND FOR OTHER PURPOSES.

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15                                Subtitle

16                       TO CUT THE STATEWIDE SALES TAX RATE BY

17                       ONE-EIGHTH PERCENT TO REDUCE THE SURPLUS

18                       FUNDS COLLECTED FROM ARKANSAS TAXPAYERS.

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20 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:

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22  SECTION 1. DO NOT CODIFY. Legislative findings.

23  The General Assembly finds that:

24             (1) Arkansas has the third highest combined state and local

25 sales tax rate in the nation;

26             (2) One (1) of the reasons Arkansas has a high sales tax rate is

27 because the state levies more sales tax than is required to fund the Property

28 Tax Relief Trust Fund, which has a growing balance; and

29             (3) It is necessary to provide relief from sales tax for all

30 Arkansans.

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32  SECTION 2. Arkansas Code � 26-52-302(c)(1), concerning the additional

33 sales tax levied to fund property tax relief, is amended to read as follows:

34  (c)(1) Except for food and food ingredients that are taxed under � 26-

35 52-317 and except for used motor vehicles, trailers, and semitrailers that

36 are taxed under � 26-52-324, there is levied an additional excise tax of one-

    *JLL242*                                                       02-27-2025 09:47:44 JLL242
    As Engrossed: S2/27/25                                                  SB289

1 half of one percent (0.5%) three hundred seventy-five thousandths percent

2 (0.375%) upon all taxable sales of property, specified digital products,

3 digital codes, and services subject to the tax levied by this chapter.

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5        SECTION 3. Arkansas Code � 26-53-107(c)(1), concerning the additional

6 use tax levied to fund property tax relief, is amended to read as follows:

7        (c)(1) There is levied an additional excise tax of one-half of one

8 percent (0.5%) three hundred seventy-five thousandths percent (0.375%) upon

9 all tangible personal property, specified digital products, digital codes,

10 and taxable services subject to the tax levied by this subchapter except for

11 food and food ingredients that are taxed under � 26-53-145 and except for

12 used motor vehicles, trailers, and semitrailers that are taxed under � 26-53-

13 150.

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15       SECTION 4. EFFECTIVE DATE. Sections 2 and 3 of this act are effective

16 on the first day of the calendar quarter following the effective date of this

17 act.

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19                          /s/J. Dotson

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