HB1970
To Amend The Law Concerning The Prepayment Of Sales Tax; And To Increase The Threshold For Retailers Who Are Required To Prepay Sales Tax.
Last Action (May 5, 2025): Died in House Committee at Sine Die adjournment.
Sponsors
AI-Generated Summary
House Bill 1970 amends Arkansas Code § 26-52-512(a) to modify the threshold for retailers required to make prepayments of sales tax. Currently, retailers with average monthly net sales exceeding $200,000 are subject to mandatory sales tax prepayment requirements. This bill increases that threshold to $500,000. Retailers meeting the new, higher average net sales threshold will continue to be required to make prepayments via electronic funds transfer based on specific payment options outlined in the statute. The change effectively reduces the number of businesses mandated to participate in the prepayment system.
Potential Impact Analysis
Who Might Benefit?
The primary beneficiaries are mid-sized retail businesses in Arkansas that have average monthly net sales between $200,000 and $500,000. By increasing the threshold, these businesses are relieved of the administrative and cash-flow burden associated with mandated bi-monthly sales tax prepayments, allowing them to retain those funds for a longer period before filing their final monthly returns.
Who Might Suffer?
The primary entity negatively impacted is the State of Arkansas. By raising the threshold for prepayment, the state will experience a delay in the receipt of sales tax revenue from those businesses that fall between the $200,000 and $500,000 monthly sales mark. This shift could result in a temporary reduction in available state cash flow during the affected periods, potentially impacting short-term budgetary planning.
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