Senate committee passes broad tax reform package with corporate rate cuts, online-sales collection and new car-wash rules

The Senate Revenue & Tax Committee on a voice vote approved an amended omnibus tax bill (Senate Bill 576) that would reduce Arkansas’s top corporate income tax rate in two steps, move corporations to a single-sales-factor apportionment, extend net operating-loss carryforwards and authorize collections of online use tax.

Sponsor Bart Hester told the committee the bill is designed to make Arkansas more competitive for business. "We worked through the tax reform task force," Hester said, summarizing the package as an effort to lower overall rates and attract investment.

The amendment adopted in committee reduces the corporate rate from 6.5 percent to 6.2 percent in 2021 and to 5.9 percent in 2022, keeps the existing throwback rule in place (removing an earlier repeal), and extends the net operating loss carryforward period from five years to…