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HB 1970

Revenue and taxation; Filmed in Oklahoma Act of 2021; incentive amounts; effective date; emergency.

2025 Regular Session Introduced by Danny Williams

Arkansas raises the monthly prepayment threshold for gross receipts tax from $200,000 to $500,000, easing prepayment burdens on midsize retailers.

Referred to Appropriations and Budget Finance Subcommittee
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Bill Summary · HB 1970

Summary — HB 1970 (Arkansas, 95th General Assembly, 2025)

Status: Died in Committee (House) — Filed Jan 22, 2025; Died at sine die adjournment (House committee) on May 5, 2025.

Purpose

To amend Arkansas law governing mandatory prepayment of state sales (gross receipts) tax by certain retailers by increasing the monthly average sales threshold that triggers the prepayment requirement. The change is intended to reduce the number of retailers required to make periodic electronic prepayments, easing cash‑flow and administrative burdens for smaller businesses.

Key provisions

  • Amends Arkansas Code § 26-52-512(a).
  • Changes the threshold for mandatory prepayment from retailers with average net sales of more than $200,000 per month to more than $500,000 per month (measured on July 1 for the preceding fiscal year that ran July 1–June 30).
  • Maintains existing prepayment mechanics and timing options:
    • Option 1: Two electronic payments per calendar month, each equal to 40% of the tax due on the monthly average net sales, due on the 12th and 24th; the remaining balance remitted with the monthly gross receipts tax report (due by the 20th of the following month).
    • Option 2: One electronic payment per month equal to at least 80% of the gross receipts tax liability due by the 24th; the remaining balance remitted with the monthly report by the 20th of the following month.
  • The bill uses the same definition of electronic funds transfer as in § 26-19-101.
  • Implementation timing: A retailer’s obligation is determined by its average monthly net sales on July 1 for the preceding fiscal year; if above the threshold, prepayment begins the following January 1.

Who is affected

  • Retailers registered to collect Arkansas gross receipts tax whose average monthly net sales fall between $200,000 and $500,000 would be removed from mandatory prepayment status under this bill.
  • The Department of Finance and Administration (and tax administration systems) would continue to administer prepayment rules but would have fewer accounts subject to prepayment.
  • State cash‑flow/timing of receipts could shift modestly if fewer retailers remit prepayments.

Fiscal/administrative impacts

  • Potential minor reduction in state cash inflows timing (less frequent advance collections) but no change to total tax liabilities.
  • Cash‑flow relief for small/medium retailers previously required to prepay.
  • Minimal implementation burden beyond updating guidance and systems to the new threshold if enacted.

Procedural notes

  • Primary sponsors listed: Senator Gilmore and Representative Beaty Jr. (document includes unrelated content and sponsors from another jurisdiction; this summary focuses on the Arkansas measure).
  • Bill was reported favorably as substituted in committee but ultimately died in the House committee at adjournment and did not become law.

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

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