An Act amending Titles 8 (Boroughs and Incorporated Towns), 11 (Cities) and 16 (Counties) of the Pennsylvania Consolidated Statutes, in corporate power relating to boroughs, further providing for specific powers; in veterans' affairs relating to boroughs, further providing for care and erection of memorials; in corporate powers relating to third class cities, providing for control, maintenance and repair of memorials; in veterans' affairs relating to third class cities, further providing for care of memorials; in grounds and buildings, further providing for monuments, memorials and memorial halls to war veterans and for preservation, maintenance, repair and completion of public monuments; and making an editorial change.

2025-2026 Regular Session Introduced by Bob Freeman and 5 co-sponsors

The bill would tax-exempt certain purchases for qualifying disabled veterans and their authorized buyers, up to $25,000 per veteran annually.

Referred to Local Government

Summary — HB 1738 (95th General Assembly, 2025) — Arkansas

Status: Died in Conference (March 29, 2025)

Purpose
- Create a state sales and use tax exemption for certain disabled veterans and household members who make purchases on their behalf.

Key provisions
- Who qualifies: A "disabled veteran" is defined by reference to Ark. Code § 26-3-306 — i.e., veterans who receive VA special monthly compensation for loss or loss of use of limbs, total blindness in one or both eyes, or service‑connected 100% total and permanent disability.
- Eligible purchases: Exempts gross receipts from sales of tangible personal property, specified digital products, digital codes, and services purchased by the disabled veteran or by a household member authorized to buy for the veteran.
- Documentation and administration:
- The veteran must submit a VA letter certifying eligibility to the Arkansas Department of Finance and Administration (DFA).
- DFA will issue exemption identification cards to qualifying veterans and to household members authorized to purchase on the veteran’s behalf.
- DFA must promulgate implementing rules.
- Annual cap: Exemption limited to $25,000 of qualifying purchases per disabled veteran per calendar year.
- DFA may require an oath-statement from claimants certifying purchases have not exceeded the cap.
- Amounts claimed exempt in excess of the cap are treated as a direct tax liability; DFA may recover tax, penalties and interest.
- Fraud: Knowingly claiming the exemption to defraud is a Class C misdemeanor.
- Effective date: the first day of the calendar quarter following enactment (DFA fiscal example assumed 10/1/2025).

Fiscal and administrative impact (DFA estimate)
- Estimated state sales & use tax loss:
- FY2026 (assumed 10/1/2025 effective): approximately −$19,221,583 total; General Revenue −$12,908,032.
- FY2027: approximately −$29,697,346 total; General Revenue −$17,956,364.
- Local (city/county) sales tax loss also projected (e.g., $9,758,650 in FY2026).
- Implementation costs: Arkansas Integrated Revenue System programming estimated at $340,000 (one‑time) + $20,000 annual maintenance.
- Additional staffing requested for card issuance and program administration (estimated positions and annual salary amounts included in DFA statement).

Legal/administrative note
- DFA flagged a possible conflict with the Streamlined Sales and Use Tax Agreement §323, which restricts exemptions that impose caps unless the state assumes administrative responsibility so as not to increase retailer burden.

Affected parties
- Directly: qualifying disabled veterans (per §26‑3‑306) and authorized household purchasers.
- Indirectly: state and local governments (revenue loss), DFA (administration and enforcement), and retailers (processing exemption cards).

Other
- Sponsors: Rep. Crawford (primary) and Sen. J. Boyd (primary), with multiple cosponsors.
- Companion bills: SB 2723, HB 903.