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Arkansas Tax Reform and Relief Legislative Task Force Update
Thursday, April 5, 2018 6:55 AM

Credit unions have a new opportunity to visit with their state legislators to explain the credit union tax exemption, as a result of the list of recommendations released by the Arkansas Tax Reform and Relief Legislative Task Force Committee.

During its March 20 meeting, the Legislative Task Force Committee compiled a list of Recommendations and Requests for Information about sales and use tax. This document is designed to provide the estimated value of various exemptions. The Committee used the information packet "Exemptions from the 6.5 percent Arkansas Gross Receipts Tax and Compensating Use Tax" prepared by the Department of Finance and Administration Economic Analysis and Tax Research, and refers to Exemptions for Non-Profit, Religious, or Charitable Organizations, Item 13 (page 9), as "Sales to Federally Chartered Credit Unions," referring to Ark. Code 23-35-103:  $987,549; (General Revenue Portion – $683,688) (FY2017).  

On Monday, the Committee posted the Recommendations/Requests for Information list of areas they plan to review during their April 25 meeting. Federally chartered credit unions made this list, along with 43 items from food tax (grocery), medical exemptions—prescription drugs, durable medical equipment, sales of dental appliances, sales by public schools for tickets, and parking spaces charged by government (schools).

Gov. Asa Hutchinson has already announced that during the 2019 regular legislative session, he plans to propose reducing the state’s top income tax rate from 6.9 percent to 6 percent, which would reduce revenue by about $180 million dollars a year. 

During the 2015 and 2017 legislative sessions, lawmakers reduced other individual income taxes to the tune of $150 million a year. 

Watch for more updates after the April committee meetings. For further information, please contact Arkansas Credit Union Association Lobbyist Ron Harrod at 501-944-3068 or rharrod@sbcglobal.net.