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Bill > SB2

AR SB2

To Create An Earned Income Tax Credit, An Increased Standard Deduction, And An Individual Income Tax Reduction; And To Provide Funding For Income Tax Reductions Through New Taxes On Cigarettes And E-cigarettes.

summary

Introduced
11/16/2020
In Committee
01/11/2021
Crossed Over
Passed
Dead
10/15/2021

Introduced Session

93rd General Assembly (2021 Regular)

Bill Summary

AN ACT TO REDUCE THE INCOME TAX IMPOSED ON CERTAIN INDIVIDUALS, TRUSTS, AND ESTATES; TO INCREASE THE STANDARD DEDUCTION FOR INCOME TAX PURPOSES; TO CREATE AN EARNED INCOME TAX CREDIT; TO CREATE THE EARNED INCOME TAX CREDIT TRUST FUND; TO FUND INCOME TAX REDUCTIONS THROUGH NEW TAXES ON CIGARETTES AND E- CIGARETTES; TO IMPOSE A PRIVILEGE TAX ON E- CIGARETTES; TO IMPOSE A SPECIAL EXCISE TAX ON THE RETAIL SALE OF CIGARETTES; AND FOR OTHER PURPOSES.

AI Summary

This bill proposes several provisions to reduce the income tax burden on individual taxpayers in Arkansas: 1. It creates an Earned Income Tax Credit (EITC) that will provide a refundable tax credit to eligible low-income individuals, with the amount of the credit determined annually based on the funds available in the newly created EITC Trust Fund. 2. It increases the standard deduction for individual income tax purposes from $2,200 to $3,300 per taxpayer, starting in 2022. 3. It reduces the individual income tax rates for those with taxable income under $22,200, lowering the top rate from 3.4% to 3%. 4. It imposes a new 20% special excise tax on the retail sale of cigarettes, and a privilege tax on e-cigarettes, with the revenue from these new taxes deposited into the General Revenue Fund to offset the cost of the individual income tax reductions.

Committee Categories

Budget and Finance

Sponsors (1)

Last Action

Died in Senate Committee at Sine Die adjournment. (on 10/15/2021)

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