SB257
To Create The Access To Credit For Our Rural Economy (acre) Act; And To Provide An Income Tax Deduction For Certain Agricultural Loans.
Last Action (May 1, 2023): Sine Die adjournment
Sponsors
AI-Generated Summary
Senate Bill 257, titled the 'Access to Credit for Our Rural Economy (ACRE) Act,' introduces an income tax deduction for eligible financial institutions in Arkansas. The bill allows banks, trust companies, and federal savings banks to deduct the net interest income earned from 'qualified agricultural loans' when computing their state income tax. Qualified agricultural loans are defined as those secured by personal property used for agricultural purposes, such as machinery or livestock, or loans secured by real estate substantially used for agricultural production under specific equity conditions. The goal of the legislation is to encourage financial institutions to provide more credit to the agricultural sector. The act is set to become effective for tax years beginning on or after January 1, 2024.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries are eligible lending institutions, including national and state banks, state trust companies, and federal savings banks, which will receive a new tax deduction. Additionally, agricultural producers and farmers in Arkansas may benefit if the tax incentive encourages these lending institutions to increase the availability of credit or offer more favorable lending terms for agricultural equipment, livestock, and real estate loans.
Who Might Suffer?
The state government of Arkansas would be negatively impacted in the sense that the bill creates a new tax expenditure, resulting in a reduction of total state tax revenue. This could potentially reduce the funds available for other public programs, services, or budget appropriations.
Get Notified
Receive an email when this bill's status changes.