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HB 1203

TO PROTECT ARKANSAS TAXPAYERS FROM A TAX TO COLLECT TAXES.

2025 Regular Session Introduced by Ben Gilmore and 1 co-sponsor

HB 1203 aimed to eliminate a $50 fee for Arkansas sales tax permits, easing access for new businesses but ultimately failed, keeping the fee in place.

Died in House Committee at Sine Die adjournment.
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Bill Summary · HB 1203

Summary of House Bill 1203 (HB 1203)

Bill Overview

  • Bill Number: HB 1203
  • Title: To Protect Arkansas Taxpayers from a Tax to Collect Taxes
  • Introduced: January 22, 2025
  • Status: Died in House Committee at Sine Die adjournment on May 5, 2025
  • Sponsors: Representative Underwood, Senator Gilmore

Purpose and Intent

House Bill 1203 aimed to eliminate the requirement for a nonrefundable fee of $50 that applicants must pay to the Arkansas Department of Finance and Administration (DFA) when applying for a gross receipts tax (sales tax) permit. The bill was designed to relieve taxpayers from this financial burden, thereby simplifying the process of obtaining a sales tax permit.

Key Provisions

  • Elimination of Fee: The bill proposed to amend Arkansas Code § 26-52-203 to prohibit the DFA from charging the $50 fee required for issuing a new sales tax permit.
  • Impact on Revenue: The removal of this fee would result in a projected reduction of approximately $432,000 in revenue to the State Central Services Fund for the fiscal year 2026. This estimate was based on average permit fees collected from FY2022 to FY2024.
  • Implementation Costs: The estimated cost for programming changes to the Arkansas Integrated Revenue System (AIRS) was $8,000, with no ongoing maintenance costs anticipated.

Impact on Stakeholders

  • Taxpayers: Individuals and businesses applying for a gross receipts tax permit would no longer be required to pay the $50 application fee, making it more accessible for new businesses to enter the market.
  • Department of Finance and Administration: The DFA would need to update its staff and the taxpayer community regarding the changes, as well as revise the Sales and Use Tax Rules accordingly.

Procedural Aspects

  • The bill was filed and read for the first time on January 22, 2025, with rules suspended for a second reading and referral to the Committee on Revenue & Taxation.
  • Despite its introduction, HB 1203 ultimately did not progress beyond the committee stage and was declared dead at the sine die adjournment on May 5, 2025.

Conclusion

While HB 1203 sought to alleviate a financial requirement for taxpayers in Arkansas, it did not advance through the legislative process. The proposed changes would have had a significant impact on new businesses seeking to obtain sales tax permits, but the bill's failure to pass means that the existing fee structure remains in place.

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

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