Bill > HB1671

This bill creates a new sales and use tax exemption for small, community-based nonprofit organizations in Arkansas. Specifically, the bill defines a "qualified nonprofit organization" as a 501(c)(3) nonprofit with an annual operating budget under $200,000 that provides charitable services to residents in need. The exemption applies to the state's gross receipts tax and compensating use tax for sales of tangible personal property and services to these organizations, with several notable exclusions such as motor vehicles, boats, aircraft, alcoholic beverages, computers, and household appliances. To receive the exemption, nonprofits must apply to the Secretary of the Department of Finance and Administration, who will review the application and issue an exemption certificate if the organization meets the criteria. The secretary has the authority to revoke the certificate if the organization no longer qualifies and must report annually to the Legislative Council on the number of exemption certificates issued. The bill will take effect on the first day of the calendar quarter following its enactment, providing a new financial benefit to small nonprofit organizations serving local communities.

Budget and Finance

https://arkleg.state.ar.us/Bills/Detail?id=hb1671&ddBienniumSession=2025%2F2025R