LITTLE ROCK (Sept. 15, 2023) – Upon Governor Sarah Huckabee Sanders’ signature of the special session tax cuts, NFIB State Director Katie Burns applauded the reform as a ‘huge win’ for Arkansas small businesses:
“As indicated in a recent survey, many of our small business owners are struggling to fill open positions and keep up with rising costs. This tax relief, coupled with the $186 million in tax relief during the regular session, is a huge win for our job creators that will provide meaningful savings. With a lesser tax burden, small business owners will be able to raise wages, create jobs, and invest in their communities. We look forward to working with the Governor and the General Assembly to fully phase out our state income tax.”
Background:
The First Special Session of the 94th General Assembly convened on Monday, September 11. After days of debate on several bills including tax relief for more than 1.1 million Arkansans, the session concluded on Thursday, September 14. Most notably, the Governor signed HB1004 and SB8 which would create a $710 million reserve fund for the state and decrease the top tax rates for individuals and corporations. With this new law, the top individual rate will decrease to 4.4% and the corporate rate will lower to 4.8%.
A recent NFIB survey found that 23 percent of small business owners reported that inflation was their single most important business problem, up two points from last month.
NFIB Arkansas supported the $186 million tax relief passed during the 94th General Assembly’s Regular Session, which was retroactive and went into effect on January 1, 2023. The tax reform decreased the individual top rate from 4.9% to 4.7%. For Arkansas-based corporations, as well as those domiciled outside the state, the tax rate decreased from 5.3% to 5.1%.
