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HB 1319

ATHLETIC ORG-MILITARY CONFLICT

104th Regular Session Introduced by C.D. Davidsmeyer

House Bill 1319 offers a $5,000 sales tax exemption for disabled veterans and their spouses, easing financial burdens and recognizing their service.

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WeVote Research Nonpartisan
Bill Summary · HB 1319

Summary of House Bill 1319 (HB 1319)

Purpose and Intent

House Bill 1319 (HB 1319) aims to provide a state sales tax exemption for disabled veterans, their spouses, and surviving spouses. This legislation is designed to alleviate financial burdens on these individuals by allowing them to make certain purchases without incurring state sales tax, thereby recognizing their service and sacrifices.

Key Provisions

  • Sales Tax Exemption: The bill establishes a sales tax exemption for:

    • Disabled veterans
    • Spouses of disabled veterans
    • Unmarried surviving spouses of disabled veterans

  • Eligibility Criteria:

    • A "disabled veteran" is defined as someone who qualifies for a property tax exemption under Arkansas law, specifically those receiving special monthly compensation from the U.S. Department of Veterans Affairs for severe disabilities.

  • Exemption Limit:

    • The maximum exemption amount is set at $5,000 per calendar year for eligible individuals.

  • Identification Requirements:

    • Disabled veterans must obtain an identification card from the Arkansas Department of Veterans Affairs (ADVA) to claim the exemption.
    • Surviving spouses must provide a certification letter from the U.S. Department of Veterans Affairs confirming their status.

  • Vendor Responsibilities:

    • Merchants must record the unique serial number from the identification card for exempt transactions and report it in their monthly sales tax returns.

  • Exemption Scope:

    • The exemption applies only to sales made at physical locations within Arkansas and does not cover local government sales taxes or compensating use taxes.

  • Penalties for Fraud:

    • Individuals claiming the exemption fraudulently may face a Class C misdemeanor charge.

Fiscal Impact

  • Estimated Revenue Loss:

    • The bill is projected to result in a significant loss of state sales tax revenue, estimated at approximately $15.2 million in FY2026 and $23.5 million in FY2027.

  • Implementation Costs:

    • The Arkansas Department of Finance and Administration (DFA) will incur costs for updating computer systems and tax forms, estimated at $13,000.

Affected Parties

  • Primary Beneficiaries:

    • Disabled veterans, their spouses, and surviving spouses will directly benefit from the sales tax exemption.

  • Vendors:

    • Retailers and service providers will need to adapt their sales processes to accommodate the new exemption requirements.

Procedural Aspects

  • Current Status: As of February 11, 2025, the committee on EEP/WAL has recommended that the measure be deferred.
  • Timeline:
    • The bill was introduced on January 30, 2025, and is pending further legislative action.

Conclusion

HB 1319 seeks to honor the contributions of disabled veterans and their families by providing financial relief through a sales tax exemption. While the bill has the potential to significantly impact state revenue, it aims to support those who have served the nation. Further legislative discussions will determine its future.

Compiled from official sources — confirm details with the bill’s official record.

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