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Arkansas Senate Bill SB133

Arkansas 2023 Regular Session

Arkansas Senate Bill SB133 Compare Versions

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11 Stricken language would be deleted from and underlined language would be added to present law.
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44 State of Arkansas 1
55 94th General Assembly A Bill 2
66 Regular Session, 2023 SENATE BILL 133 3
77 4
88 By: Senators J. Payton, J. Dotson, G. Stubblefield, Stone, D. Sullivan 5
99 By: Representatives Lundstrum, Andrews, Beck, S. Berry, M. Brown, John Carr, C. Cooper, Duffield, 6
1010 Ennett, Hawk, D. Hodges, G. Hodges, Hollowell, Hudson, Ladyman, Long, Lynch, Maddox, McAlindon, 7
1111 McClure, McCollum, McCullough, McGrew, S. Meeks, J. Moore, Painter, Pearce, Puryear, R. Scott 8
1212 Richardson, Rose, Underwood, Unger, Watson, D. Whitaker, Womack 9
1313 10
1414 For An Act To Be Entitled 11
1515 AN ACT TO AMEND THE SALES AND USE TAX AP PLICABLE TO 12
1616 NEW AND USED MOTOR V EHICLES, TRAILERS, A ND 13
1717 SEMITRAILERS; TO INC REASE THE SALES AND USE TAX 14
1818 EXEMPTION FOR USED M OTOR VEHICLES; TO RE PEAL THE 15
1919 SPECIAL RATE OF TAX FOR CERTAIN USED MOT OR VEHICLES, 16
2020 TRAILERS, AND SEMITR AILERS; TO REPEAL TH E SALES AND 17
2121 USE TAX EXEMPTION FOR NE W MOTOR VEHICLES, TR AILERS, 18
2222 AND SEMITRAILERS; AN D FOR OTHER PURPOSES . 19
2323 20
2424 21
2525 Subtitle 22
2626 TO INCREASE THE SALES AND USE TAX 23
2727 EXEMPTION FOR USED MOTOR VEHICLES; AND TO 24
2828 REPEAL THE SPECIAL RATE OF TAX FOR 25
2929 CERTAIN USED MOTOR VEHICLES, TRAILERS, 26
3030 AND SEMITRAILERS. 27
3131 28
3232 29
3333 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS: 30
3434 31
3535 SECTION 1. The introductory language of Arkansas Code § 26 -52-301 is 32
3636 amended to read as follows: 33
3737 Except for food and food ingredients that are taxed under § 26-52-317 34
3838 and except for used motor vehicles, trailers, and semitrailers that are taxed 35
3939 under § 26-52-324, there is levied an excise tax of three percent (3%) upon 36 SB133
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4343
4444 the gross proceeds or gross receipts derived from all sales to any person of 1
4545 the following: 2
4646 3
4747 SECTION 2. Arkansas Code § 26 -52-302 is amended to read as follows: 4
4848 26-52-302. Additional taxes levied. 5
4949 (a)(1) In addition to the excise tax levied upon the gross proceeds or 6
5050 gross receipts derived from all sales by this chapter, except for food and 7
5151 food ingredients that are taxed under § 26-52-317 and except for used motor 8
5252 vehicles, trailers, and semitrailers that are taxed under § 26-52-324, there 9
5353 is levied an excise tax of one percent (1%) upon all taxable sales of 10
5454 property, specified digital products, digital codes, and services subject to 11
5555 the tax levied in this chapter. 12
5656 (2) This tax shall be collected, reported, and paid in the same 13
5757 manner and at the same time as is prescribed by law for the collection, 14
5858 reporting, and payment of all other Arkansas gross receipts taxes. 15
5959 (3) In computing gross receipts or gross proceeds as defined in 16
6060 § 26-52-103, a deduction shall be allowed for bad debts resulting from the 17
6161 sale of tangible personal property. 18
6262 (b)(1) In addition to the excise tax levied upon the gross proceeds or 19
6363 gross receipts derived from all sales by this chapter, except for food and 20
6464 food ingredients that are taxed under § 26-52-317 and except for used motor 21
6565 vehicles, trailers, and semitrailers that are taxed under § 26-52-324, there 22
6666 is hereby levied an excise tax of one-half of one percent (0.5%) upon all 23
6767 taxable sales of property, specified digital products, digital codes, and 24
6868 services subject to the tax levied in this chapter. 25
6969 (2) This tax shall be collected, reported, and paid in the same 26
7070 manner and at the same time as is prescribed by law for the collection, 27
7171 reporting, and payment of all other Arkansas gross receipts taxes. 28
7272 (3) However, in computing gross receipts or gross proceeds as 29
7373 defined in § 26-52-103, a deduction shall be allowed for bad debts resulting 30
7474 from the sale of tangible personal property. 31
7575 (c)(1) Except for food and food ingredients that are taxed under § 26-32
7676 52-317 and except for used motor vehicles, trailers, and semitrailers that 33
7777 are taxed under § 26-52-324, there is levied an additional excise tax of one-34
7878 half of one percent (0.5%) upon all taxable sales of property, specified 35
7979 digital products, digital codes, and services subject to the tax levied by 36 SB133
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8484 this chapter. 1
8585 (2) The tax shall be collected, reported, and paid in the same 2
8686 manner and at the same time as is prescribed by this chapter, for the 3
8787 collection, reporting, and payment of Arkansas gross receipts taxes. 4
8888 (d)(1) Except for food and food ingredients that are taxed under § 26-5
8989 52-317 and except for used motor vehicles, trailers, and semitrailers that 6
9090 are taxed under § 26-52-324, there is levied an additional excise tax of 7
9191 seven-eighths of one percent (0.875%) upon all taxable sales of property, 8
9292 specified digital products, digital codes, and services subject to the tax 9
9393 levied by this chapter. 10
9494 (2) The tax shall be collected, reported, and paid in the same 11
9595 manner and at the same time as prescribed by this chapter, for the 12
9696 collection, reporting, and payment of Arkansas gross receipts taxes. 13
9797 14
9898 SECTION 3. Arkansas Code § 26 -52-324 is repealed. 15
9999 26-52-324. Special tax rate for certain used motor vehicles, trailers, 16
100100 and semitrailers. 17
101101 (a) In lieu of the gross receipts or gross proceeds taxes levied u nder 18
102102 §§ 26-52-301 and 26-52-302, there is levied an excise tax on the gross 19
103103 receipts or gross proceeds derived from the sale of a used motor vehicle, 20
104104 trailer, or semitrailer that has a sales price of at least four thousand 21
105105 dollars ($4,000) but less than te n thousand dollars ($10,000) at the rate of 22
106106 two and eight hundred seventy -five thousandths percent (2.875%). 23
107107 (b) The tax levied in this section shall be in addition to: 24
108108 (1) Any gross receipts or gross proceeds tax levied in the 25
109109 Arkansas Constitution; 26
110110 (2) Any gross receipts or gross proceeds tax levied by a 27
111111 municipality or county; and 28
112112 (3) Any additional gross receipts or gross proceeds tax levied 29
113113 in an Arkansas city and resulting from an election within that city conducted 30
114114 in accordance with §§ 26 -52-601 — 26-52-606. 31
115115 (c) For the purpose of determining whether the tax levied by this 32
116116 section applies to the sale of a used motor vehicle, trailer, or semitrailer, 33
117117 the sales price for the used motor vehicle, trailer, or semitrailer shall not 34
118118 be reduced by: 35
119119 (1) The value of a motor vehicle, trailer or semitrailer traded 36 SB133
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123123
124124 in as part payment on the purchase price of the newly acquired motor vehicle, 1
125125 trailer, or semitrailer; or 2
126126 (2) The amount received by the purchaser for the sale of another 3
127127 motor vehicle, trailer, or semitrailer. 4
128128 (d) The revenues generated by the tax levied under this section shall 5
129129 be distributed as follows: 6
130130 (1) Seventy-six and six-tenths percent (76.6%) of the taxes, 7
131131 interest, penalties, and costs received by the Secretary of the Department of 8
132132 Finance and Administration under this section shall be deposited as general 9
133133 revenues; 10
134134 (2) Eight and five-tenths percent (8.5%) of the taxes, interest, 11
135135 penalties, and costs received by the secretary under this section shall be 12
136136 deposited into the Property Tax Relief Trust Fund; and 13
137137 (3) Fourteen and nine -tenths percent (14.9%) of the taxes, 14
138138 interest, penalties, and costs received by the secretary under this section 15
139139 shall be deposited into the Educational Adequacy Fund. 16
140140 (e) The excise tax levied under this section shall be collected and 17
141141 paid in the same manner and at the same time as is prescribed in § 26 -52-510 18
142142 for the collection and payment of gross receipts taxes on motor vehicles, 19
143143 trailers, and semitrailers. 20
144144 21
145145 SECTION 4. Arkansas Code § 26-52-510(b)(1)(B), concerning the direct 22
146146 payment of sales tax by consumer -users on new and used motor vehicles, 23
147147 trailers, or semitrailers, is amended to read as follows: 24
148148 (B)(i)(a) If the total consideration for the sale of the 25
149149 new or used motor vehicle, a used trailer, or semitrailer is less than four 26
150150 thousand dollars ($4,000), no tax is due. 27
151151 (b) If the total consideration for the sale of 28
152152 a new motor vehicle, used trailer, or semitrailer is four thousand dollars 29
153153 ($4,000) or more, the full gross receipts tax rate levied under this chapter 30
154154 shall be levied and collected. 31
155155 (ii) If the total consideration for the sale of a 32
156156 used motor vehicle, trailer, or semitrailer is at least four thousand dollars 33
157157 ($4,000) but is less than ten thousand dollars ($10,000), the gross receipts 34
158158 tax due shall be determined under § 26-52-324 no tax is due. 35
159159 (iii) If the total consideration for the sale of a 36 SB133
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164164 used motor vehicle, trailer, or semitrailer is ten thousand dollars ($10,000) 1
165165 or more:, 2
166166 (a) The exemption under subdivision 3
167167 (b)(1)(B)(i)(a) of this section does not apply; 4
168168 (b) The special tax rate provided in § 26-52-5
169169 324 does not apply; and 6
170170 (c) The the full gross receipts tax rate 7
171171 levied under this chapter shall be levied and collected. 8
172172 9
173173 SECTION 5. Arkansas Code § 26 -53-106(a), concerning the imposition and 10
174174 rate of the compensating use tax, is amended to read as follows: 11
175175 (a) There is levied and there shall be collected from every person in 12
176176 this state a tax or excise for the privilege of storing, using, distributing, 13
177177 or consuming within this state tangible personal property, specified digital 14
178178 products, a digital code, or a taxable service purchased for storage, use, 15
179179 distribution, or consumption in this state at the rate of three percent (3%) 16
180180 of the sales price of the tangible personal property, specified digital 17
181181 products, digital code, or taxable service except for food and food 18
182182 ingredients that are taxed under § 26-53-145 and except for used motor 19
183183 vehicles, trailers, and semitrailers that are taxed under § 26-53-150. 20
184184 21
185185 SECTION 6. Arkansas Code § 26 -53-107 is amended to read as follows: 22
186186 26-53-107. Additional taxes levied. 23
187187 (a)(1) In addition to the excise tax levied upon the privilege of 24
188188 storing, using, distributing, or consuming tangible personal property, 25
189189 specified digital products, a digital code, and taxable services within this 26
190190 state by this subchapter, there is levied an excise tax of one percent (1%) 27
191191 upon all tangible personal property, specified digital products, digital 28
192192 codes, and taxable services subject to the tax levied in this subchapter 29
193193 except for food and food ingredients that are taxed under § 26-53-145 and 30
194194 except for used motor vehicles, trailers, and semitrailers that are taxed 31
195195 under § 26-53-150. 32
196196 (2) The tax shall be collected, reported, and paid in the same 33
197197 manner and at the same time as is prescribed by law for the collection, 34
198198 reporting, and payment of state compensating taxes. 35
199199 (b)(1) In addition to the excise tax levied upon the privilege of 36 SB133
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203203
204204 storing, using, distributing, or consuming tangible personal property, 1
205205 specified digital products, a digital code, and taxable services within the 2
206206 state by this subchapter, there is levied an excise tax of one-half of one 3
207207 percent (0.5%) upon all tangible personal property, specified digital 4
208208 products, digital codes, and taxable services subject to the tax levied in 5
209209 this subchapter except for food and food ingredients that are taxed under § 6
210210 26-53-145 and except for used motor vehicles, trailers, and semitrailers that 7
211211 are taxed under § 26-53-150. 8
212212 (2) The tax shall be collected, reported, and paid in the same 9
213213 manner and at the same time as is prescribed by law for the collection, 10
214214 reporting, and payment of Arkansas compensating taxes. 11
215215 (c)(1) There is levied an additional excise tax of one-half of one 12
216216 percent (0.5%) upon all tangible personal property, specified digital 13
217217 products, digital codes, and taxable services subject to the tax levied by 14
218218 this subchapter except for food and food ingredients that are taxed under § 15
219219 26-53-145 and except for used motor vehicles, trailers, and semitrailers that 16
220220 are taxed under § 26-53-150. 17
221221 (2) The tax shall be collected, reported, and paid in the same 18
222222 manner and at the same time as is prescribed by this subchapter for the 19
223223 collection, reporting, and payment of Arkansas compensating taxes. 20
224224 (d)(1) There is levied an additional excise tax of seven-eighths of 21
225225 one percent (0.875%) upon all tangible personal property, specified digital 22
226226 products, digital codes, and taxable services subject to the tax levied by 23
227227 this subchapter except for food and food ingredients that are taxed under § 24
228228 26-53-145 and except for used motor vehicles, trailers, and semitrailers that 25
229229 are taxed under § 26-53-150. 26
230230 (2) The tax shall be collected, reported, and paid in the same 27
231231 manner and at the same time as is prescribed by this subchapter for the 28
232232 collection, reporting, and payment of Arkansas compensating taxes. 29
233233 30
234234 SECTION 7. Arkansas Code § 26 -53-126(b)(2), concerning the payment and 31
235235 collections of the compensating use tax on new and used motor vehicles, 32
236236 trailers, or semitrailers, is amended to read as follows: 33
237237 (2)(A)(i) If the total consideration for the sale of the new or 34
238238 used motor vehicle, a used trailer, or semitrailer is less than four thousand 35
239239 dollars ($4,000), no tax is due. 36 SB133
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244244 (ii) If the total consideration for the sale of a 1
245245 new motor vehicle, used trailer, or semitrailer is four thousand dollars 2
246246 ($4,000) or more, the full compensating use tax rate levied under this 3
247247 chapter shall be levied and collected. 4
248248 (B) If the total consideration for the sale of a used 5
249249 motor vehicle, trailer, or semitrailer is at least four thousand dollars 6
250250 ($4,000) but is less than ten thousand dollars ($10,000), the compensating 7
251251 use tax due shall be determined under § 26-53-150 no tax is due. 8
252252 (C) If the total consideration for the sale of a used 9
253253 motor vehicle, trailer, or semitrailer is ten thousand dollars ($10,000) or 10
254254 more:, 11
255255 (i) The exemption under subdivision (b)(2)(A)(i) of 12
256256 this section does not apply; 13
257257 (ii) The special tax rate provided in § 26-53-150 14
258258 does not apply; and 15
259259 (iii) The the full compensating use tax rate levied 16
260260 under this chapter shall be levied and collected. 17
261261 18
262262 SECTION 8. Arkansas Code § 26 -53-150 is repealed. 19
263263 26-53-150. Special tax rate for certain used motor vehicles, trailers, 20
264264 and semitrailers. 21
265265 (a)(1) In lieu of the compensating use taxes levied under §§ 26-53-106 22
266266 and 26-53-107, there is levied an excise tax for the privilege of storing, 23
267267 using, distributing, or consuming a used motor vehicle, trailer, or 24
268268 semitrailer within this state if the sales price of the used motor vehicle, 25
269269 trailer, or semitrailer is at least four thousand dollars ($4,000) but less 26
270270 than ten thousand dollars ($10,000). 27
271271 (2) The excise tax levied under subdivision (a)(1) of this 28
272272 section is levied at the rate of two and eight hundred seventy -five 29
273273 thousandths percent (2.8 75%) of the sales price of the used motor vehicle, 30
274274 trailer, or semitrailer. 31
275275 (b) The tax levied in this section shall be in addition to: 32
276276 (1) Any compensating use tax levied in the Arkansas 33
277277 Constitution; 34
278278 (2) Any compensating use tax levied by a munic ipality or county; 35
279279 and 36 SB133
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284284 (3) Any additional compensating use tax levied in an Arkansas 1
285285 city under § 26-52-607. 2
286286 (c) For the purpose of determining whether the tax levied by this 3
287287 section applies to the sale of a used motor vehicle, trailer, or semitrailer , 4
288288 the sales price for the used motor vehicle, trailer, or semitrailer shall not 5
289289 be reduced by: 6
290290 (1) The value of a motor vehicle, trailer, or semitrailer traded 7
291291 in as part payment on the purchase price of the newly acquired motor vehicle, 8
292292 trailer, or semitrailer; or 9
293293 (2) The amount received by the purchaser for the sale of another 10
294294 motor vehicle, trailer, or semitrailer. 11
295295 (d) The revenues generated by the tax levied under this section shall 12
296296 be distributed as follows: 13
297297 (1) Seventy-six and six-tenths percent (76.6%) of the taxes, 14
298298 interest, penalties, and costs received by the Secretary of the Department of 15
299299 Finance and Administration under this section shall be deposited as general 16
300300 revenues; 17
301301 (2) Eight and five-tenths percent (8.5%) of the taxes, interest, 18
302302 penalties, and costs received by the secretary under this section shall be 19
303303 deposited into the Property Tax Relief Trust Fund; and 20
304304 (3) Fourteen and nine -tenths percent (14.9%) of the taxes, 21
305305 interest, penalties, and costs received by the secreta ry under this section 22
306306 shall be deposited into the Educational Adequacy Fund. 23
307307 (e) The excise tax levied under this section shall be collected and 24
308308 paid in the same manner and at the same time as is prescribed in § 26 -53-126 25
309309 for the collection and payment o f compensating use taxes on motor vehicles, 26
310310 trailers, and semitrailers. 27
311311 28
312312 SECTION 9. EFFECTIVE DATE. Sections 1-8 of this act are effective on 29
313313 the first day of the calendar quarter following the effective date of this 30
314314 act. 31
315315 32
316316 33
317317 34
318318 35
319319 36