Dover Dixon Horne PLLC

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With March more than halfway over, a surprising amount of tax legislation is still on the agenda for the General Assembly.  In addition to the recently-filed major business tax reforms of SB 576, other significant tax bills that have been introduced include: (1) the Tax Reform Task Force administrative reforms (SB 561), an independent Tax Appeals Commission (SB 560), and a low-income tax cut paid for by taxes on cigarettes and e-cigarettes (SB 571).  The…
Posted in Tax
A bill was filed today to implement several major recommendations of the Tax Reform and Relief Legislative Task Force to make the Arkansas tax system fairer and more competitive.  Senate Bill 576 (SB 576) includes: (1) sales tax collection by remote sellers and marketplace facilitators; (2) single sales factor apportionment and repeal of the throwback rule; (3) extension of the net operating loss (NOL) carryforward limit from 5 years to 20 years; and (4) substitution of…
Posted in Tax
Another Tax Reform and Relief Legislative Task Force recommendation has been introduced into the General Assembly: an elective passthrough entity tax.  HB 1714 could potentially provide federal income tax relief to business owners who can no longer deduct state income taxes at the individual level, at least for tax years beginning on or after January 1, 2020. The Arkansas Pass-Through Entity Tax would be a tax imposed on “the aggregate net taxable income of each…
Posted in Tax
While so much attention is on the highway bill, businesses and economic developers should note a significant economic development bill, HB1490, that was introduced yesterday.  HB1490, which is sponsored by Representative Carlton Wing and Senator Mat Pitsch, revises and improves the Consolidated Incentives Act of 2003.  This statute governs most state-level business incentives: Advantage Arkansas, Create Rebate, Tax Back, ArkPlus, R&D credits, etc.  The numerous incremental changes would be a significant general improvement and should give…
Posted in Tax
With the Governor’s individual income tax cuts plan now passed by the Arkansas General Assembly and to be signed into law next week, the next big-ticket tax bill is for highway funding.  The package was announced on February 11, and legislation has now been introduced.  It is projected to raise $300 million annually for state highways and also $110 million for county and municipal roads.  The package will move forward with a bill containing most …
Posted in Tax
Governor Hutchinson announced his individual tax cuts plan today.  It is a scaled down version of the 2%-4%-5.9% plan that the Tax Reform and Relief Legislative Task Force had recommended.  Essentially it retains Arkansas’s unique three-bracket-schedules individual tax system and reforms the tax brackets only for the high-income bracket schedule.  There are also some minor upward adjustments to the low- and middle-income bracket schedules.  The 5.9% plan comes with a much-reduced fiscal impact: a $97 million reduction in…
Posted in Tax
Beginning January 1, 2019, Arkansas minimum wage will increase to $9.25 per hour; part of a three-year plan that will see wages increase to $10.00 per hour beginning January 1, 2020 and $11.00 beginning January 1, 2021. Dover Dixon Horne counsel Trey Cooper recently authored a column for Talk Business & Politics about best practices for employers to help avoid costly wage and hour litigation. Cooper writes, “The first step in making sure you comply…
The Arkansas Tax Reform and Relief Legislative Task Force has concluded its 20 months of proceedings by approving draft legislation for a roughly $400 million tax reform and relief package that should guide the state’s tax policy for the next decade.  If implemented, it will provide Arkansas with a fairer and more competitive tax system while maintaining the state’s fiscal stability.  The next step will be to see the proposals through and further refine them as…
Posted in Tax
During the midterm elections last month, Arkansans voted to approve Arkansas Issue 5, the Minimum Wage Increase Initiative, raising the state’s minimum wage from $8.50 an hour to $9.25 an hour. Dover Dixon Horne counsel Trey Cooper recently authored a column for Arkansas Business on what employers should understand as the law goes into effect on January 1, 2019.   Cooper writes that “all employers in Arkansas with four or more employees in any workweek…
The Arkansas Tax Reform and Relief Legislative Task Force met again on the morning of November 27 to consider structuring and timing of its recommended policy changes.  On the whole, the Task Force is on track to recommend some form of individual income tax cuts then followed by several changes to business taxation aimed to make the state more competitive.  Tax triggers would be used to prevent budget shortfalls under this approach, which differs from the…
Posted in Tax