HB1904
To Amend The Penalties Imposed For Failure To Comply With The Arkansas Tax Procedure Act.
Last Action (May 5, 2025): Died in House Committee at Sine Die adjournment.
Sponsors
AI-Generated Summary
House Bill 1904 seeks to modify the penalties imposed under the Arkansas Tax Procedure Act for taxpayers who fail to file returns or pay taxes on time. The bill proposes reducing the maximum aggregate penalty cap for failure to file or pay from the current 35% to 10%. Specifically, the bill lowers the ceiling for penalties related to late filings and late payments for both general tax returns and individual income tax returns. It maintains the existing structure of monthly penalty increments but restricts the total cumulative penalty to a lower threshold. The intent of the legislation is to cap the total financial penalties that the state can assess against delinquent taxpayers.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries of this bill are Arkansas taxpayers who fail to meet their tax filing or payment deadlines. By reducing the maximum aggregate penalty from 35% to 10%, these individuals and entities would face significantly lower financial liabilities when they are late in settling their tax obligations to the state.
Who Might Suffer?
The primary entity negatively impacted by this bill is the State of Arkansas, specifically the Department of Finance and Administration. The bill reduces the total revenue collected through late penalties, which could lead to a decrease in state funds. Additionally, there is a potential concern that lower penalty caps might reduce the incentive for taxpayers to comply with filing and payment deadlines in a timely manner.
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