On March 17, 2021, Arkansas introduced S.B. 558, which would impose Arkansas sales tax on advertising revenue from social-media platforms that have annual gross revenue from social-media advertising services in Arkansas of at least $500,000. The bill amends the sales tax statute to include a new subchapter imposing a 7% sales tax on a social-media provider’s gross revenue from social-media advertising services in Arkansas plus one dollar for the average number of Arkansas account holders during a calendar year. Social-media advertising services includes advertising services that are placed or provided on a social-media platform, including without limitation banner advertising, promoted content, interstitial advertising, and other comparable services. “Social-media provider” includes a business entity that maintains or operates a public social-medial platform, and that has at least 500,000 Arkansas account holders.
