Committee backs requiring voter approval for new or increased advertising‑promotion taxes

Little Rock — The Senate Revenue & Tax Committee voted to approve House Bill 1027, legislation that would require voter approval for any new advertising‑promotion (A&P) tax or any increase to an existing A&P rate.

Senator Johnson, speaking for the bill and noting Representative Ray’s work in the House, said the A&P tax is currently the only local tax that does not require voter approval. "The bill simply would require voter approval of any new, not existing, new advertising promotion taxes or increase in the current rate," Johnson said, adding that the bill is prospective and "existing A and P taxes would not be affected, only new ones or increases." He also said an emergency clause was added so the law would take effect immediately if passed, to prevent cities from implementing taxes before the change could apply.

Paul Gehring of the Department of Finance and Administration told the committee DFA reviewed the bill and did not issue a fiscal impact statement because the measure "does not pertain to any tax that we would need to administer or provide a fiscal impact."

Committee members asked whether the bill would affect local‑option or temporary sales taxes; sponsors clarified HB 1027 addresses only advertising‑promotion taxes and does not alter the separate local sales‑tax processes that are already referred to voters. After brief discussion and no public testimony, the committee approved the bill on a do‑pass motion.

The bill now moves forward in the legislative process.