Bill to conform Arkansas depreciation rules to federal code would boost first‑year writeoffs, sponsors say

Representative Howard Beatty presented House Bill 1501 to the Revenue & Taxation Committee as a measure to align Arkansas' tax code with federal depreciation rules under Internal Revenue Code section 168. Beatty said the change would permit larger first‑year deductions—so‑called bonus depreciation—for qualifying business property placed in service, and that proponents view the change as an incentive for business investment.

Beatty told the committee that bonus depreciation "allows businesses to deduct a larger portion of the cost of qualifying property in the year that it's placed in service" and that the policy is intended to stimulate investment and productivity. He acknowledged the committee packet includes a sizable fiscal impact estimate and that members should consider dynamic scoring to evaluate long‑term effects.

Committee members asked clarifying questions about the scale and timing of the fiscal impact described in the bill's fiscal note. Beatty referenced the committee fiscal summary in describing a large projected reduction in general revenue tied to the conformity proposal and said the policy is intended to encourage in‑state investment despite that near‑term effect.

No vote was taken on HB 1501; the bill was presented for testimony and follow-up analysis.

Ending: Sponsors said HB 1501 would bring Arkansas into conformity with federal bonus‑depreciation rules and could stimulate capital investment; committee members requested more detailed fiscal analysis before moving forward.