The Arkansas state lawmakers have approved a plan proposed by Republican Governor Sarah Huckabee Sanders to reduce individual and corporate income taxes by $124 million annually.
Arkansas lawmakers approve $124 million income tax cut plan. (Photo: Business Times)
Legislation for Income Tax Cut Plan is now o the Governor’s Desk
The legislation, which has now been sent to the Governor’s desk, aims to lower the top individual income tax rate to 4.7% from 4.9% and the top corporate income tax rate to 5.1% from 5.3%, according to a report published in Associated Press.
Arkansas’ revenue has been higher than anticipated over the last few years, with the state ending the last fiscal year with a record surplus of $1.6 billion. This year’s revenue has exceeded expectations by $306 million so far. Republican Rep. Les Eaves, who sponsored the bill in the House, said that the tax cuts would “eat into” the surplus.
According to state finance officials, the proposal will benefit 1.1 million taxpayers who earn more than $24,300 per year. Sanders has expressed her desire to phase out the state’s income tax since she assumed office in January. Over the past few years, the former Republican governor, Asa Hutchinson, and the Republican-majority Legislature have introduced several tax cuts.
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Arkansas House Approves Income Tax Cut Plan
This tax cut plan was approved by the majority-Republican House in Arkansas. This reduction in taxes will take effect as the state’s revenue has been higher than expected in recent years, and the government has ended the last fiscal year with a record surplus of $1.6 billion.
In a published article in Journal Record, the state’s finance officials estimated that over 1 million taxpayers who make more than $24,300 per year would receive a cut in their taxes. The bill reduces the top individual and corporate income tax rates by 0.2%. Sanders has been calling for phasing out the state’s income tax, which has been receiving support from the Republican-dominated Legislature.
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