Arkansas Agriculture — Edition 29
Change Language:
Policy Update
When Rep. Davy Carter suggested the state Revenue and Taxation Committee use part of its time during this fiscal legislative session to review the state’s sales tax exemptions, he got the attention of everyone from businesses to churches and charities to farmers. The idea wasn’t to necessarily do away with any of the existing exemptions, just evaluate them.
Rep. Carter is on record saying all the state’s sales and use tax exemptions could be warranted. There are approximately 120 sales and use tax exemptions on the books in Arkansas. As Chairman of the House Revenue and Taxation Committee, Carter has a responsibility to review Arkansas’ tax law. The House and Senate Revenue and Taxation committees are the primary guardians of the state’s revenue. It’s their job to shape the best tax policy for the state while ensuring adequate revenue for the state’s budget. The committees often have to hold the line during a legislative session, making sure any tax cuts are responsible tax policy. In recent years, several members of the state legislature have pitched ideas of reshaping tax law either through expanding the tax exemption list, eliminating the exemption list entirely or restructuring the income tax levels.
Simple revisions in tax law are common in Arkansas. Arkansas Farm Bureau policy contains support for many others. As befitting a major economic force, agriculture has established several tax breaks for farmers, integrators and processors. The past three sessions ArFB has led an effort to establish a sales tax exemption for energy sales for farms and supported several other tax saving measures. However, one can’t talk about tax cuts without talking about the state budget.
In 1945, Arkansas Gov. Ben Raney proposed the creation of the Revenue Stabilization Amendment, which allowed budget makers to evaluate general revenue and expenses and make adjustments as needed. Every year, Arkansas looks at the income and financial obligations and assigns priorities to its expenses. The state constitution prohibits deficit spending. It isn’t a novel idea, but it’s one most states have abandoned. In these economic hard times, it’s made Arkansas the envy of the nation; a state with a solid budget. Farmers and ranchers can appreciate that.
Agriculture is woven throughout Arkansas’ economy and contributes considerably to the state’s stability, especially during this recession. ArFB whole-heartedly supports agriculture’s tax exemptions. And ArFB and our farmer members should always be prepared to discuss those exemptions and champion their existence. Not just because they’ve historically been there or because we want them but also because they make good fiscal sense, keeping Arkansas competitive with other states, adding purchasing dollars to rural Arkansans and by providing a measure of stability to one of the largest economic engines in the state.
Lawmakers have decided to postpone the review of tax exemptions until after the fiscal session, but there are still plans to do an in-depth discussion of the state tax code. So while the legislature examines agriculture’s exemptions, perhaps we should do the same, developing reasoned arguments for the ones we have and hope to secure while evaluating what’s the best tax policy for agriculture and the state moving forward.
Rep. Carter is on record saying all the state’s sales and use tax exemptions could be warranted. There are approximately 120 sales and use tax exemptions on the books in Arkansas. As Chairman of the House Revenue and Taxation Committee, Carter has a responsibility to review Arkansas’ tax law. The House and Senate Revenue and Taxation committees are the primary guardians of the state’s revenue. It’s their job to shape the best tax policy for the state while ensuring adequate revenue for the state’s budget. The committees often have to hold the line during a legislative session, making sure any tax cuts are responsible tax policy. In recent years, several members of the state legislature have pitched ideas of reshaping tax law either through expanding the tax exemption list, eliminating the exemption list entirely or restructuring the income tax levels.
Simple revisions in tax law are common in Arkansas. Arkansas Farm Bureau policy contains support for many others. As befitting a major economic force, agriculture has established several tax breaks for farmers, integrators and processors. The past three sessions ArFB has led an effort to establish a sales tax exemption for energy sales for farms and supported several other tax saving measures. However, one can’t talk about tax cuts without talking about the state budget.
In 1945, Arkansas Gov. Ben Raney proposed the creation of the Revenue Stabilization Amendment, which allowed budget makers to evaluate general revenue and expenses and make adjustments as needed. Every year, Arkansas looks at the income and financial obligations and assigns priorities to its expenses. The state constitution prohibits deficit spending. It isn’t a novel idea, but it’s one most states have abandoned. In these economic hard times, it’s made Arkansas the envy of the nation; a state with a solid budget. Farmers and ranchers can appreciate that.
Agriculture is woven throughout Arkansas’ economy and contributes considerably to the state’s stability, especially during this recession. ArFB whole-heartedly supports agriculture’s tax exemptions. And ArFB and our farmer members should always be prepared to discuss those exemptions and champion their existence. Not just because they’ve historically been there or because we want them but also because they make good fiscal sense, keeping Arkansas competitive with other states, adding purchasing dollars to rural Arkansans and by providing a measure of stability to one of the largest economic engines in the state.
Lawmakers have decided to postpone the review of tax exemptions until after the fiscal session, but there are still plans to do an in-depth discussion of the state tax code. So while the legislature examines agriculture’s exemptions, perhaps we should do the same, developing reasoned arguments for the ones we have and hope to secure while evaluating what’s the best tax policy for agriculture and the state moving forward.
Message