With the September 1 deadline quickly approaching for the final report, the 16-member Arkansas Tax Reform and Relief Legislative Task Force approved the entirety of its draft report, Dover Dixon Horne member Matt Boch told Bloomberg Tax.
Among the final recommendations include “tweaking how income tax is calculated and requiring remote sellers to collect sales tax.”
The Department of Finance and Administration unveiled the “2-4-5.9/6.5 Phased-In Plan,” which would cut the state’s top rate from 6.9 percent to 5.9 percent, costing the state $191.7 million in revenue. The top marginal rate would move from 6.9 percent to 6.5 percent, costing $276 million.
‘‘Having a plan that doesn’t cost $276 million—it gives you more room for other reforms that the state needs to be competitive,’’ Boch said.
He added that, “income tax reforms critical to the state’s economic profile are more likely to survive as legislative proposals under the less expensive plan.”
Boch also spoke to the proposed repeal of the throwback rule, which “addresses nowhere income – the portion of a business’ sales that aren’t attributed to any state and may go untaxed by any state.”
‘‘We’re in a neighborhood where a lot of states have moved or are moving to that and it’s almost like if we don’t do that, we’re losing just by standing still,’’ Boch said, referring to the adoption of apportionment reforms.