Arkansas panel advances tax break for retired veterans

LITTLE ROCK, Ark. — A state House committee approved a bill Thursday that would cut taxes for military veterans who retire in Arkansas, despite concerns among some of its members that students who buy textbooks electronically would be among those paying part of the $13 million price tag.

 

Gov. Asa Hutchinson’s initial plan to help veterans would have ended an exemption on mobile home sales. Legislators decided instead to change sales taxes on soft drinks and candy and remove a sales tax exemption for downloaded goods.

“It was important to provide the military retirees a benefit and … that cost is paid for,” Hutchinson said in a meeting with reporters at his state Capitol office after the panel’s vote. “The Legislature felt comfortable including the tax on digital downloads vs. the mobile home tax exemption.

“For that student who lives in a mobile home downloading text(book)s, it balances out,” he said.

At the House Revenue and Taxation Committee, Reps. Kim Hendren of Gravette and Les Eaves of Searcy expressed concerns that Arkansas could use students to absorb tax cuts on military retirement benefits earned by veterans, along with other computer users buying songs and other media online.

“I don’t like how we’re paying for it,” Eaves said before the committee sent the bill to the House.

Rep. Stephanie Flowers of Pine Bluff suggested a sunset clause.

“At the end of the watch, we’ve incorporated in tax increases,” she said.

Lt. Gov. Tim Griffin spoke in favor of the bill but also suggested a broad overhaul of the Arkansas tax code. He called current tax laws “indefensible” and used a coal mining reference to describe previous attempts at fixing it: “We’re putting a respirator on the canary.”

Separately, a final vote on Hutchinson’s $50 million tax cut plan to benefit those making less than $21,000 is expected Monday.

 

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