Arkansas House Bill HB1685

Arkansas 2025 Regular Session

• Introduced: 3/5/25
• Refer: 3/5/25
• Report Pass: 4/3/25
• Engrossed: 4/7/25
• Refer: 4/7/25
• Refer: 4/8/25
• Refer: 4/9/25
• Report Pass: 4/10/25
• Refer: 4/14/25
• Report Pass: 4/15/25
• Enrolled: 4/16/25
• Chaptered: 4/22/25
• Passed: 4/22/25

Caption

To Create The Grocery Tax Relief Act; To Amend The Law Concerning The Sales And Use Taxes Levied On Food And Food Ingredients, As Affirmed By Referred Act 19 Of 1958; And To Exempt Groceries From State Sales And Use Taxes.

Impact

If passed, this legislation would significantly alter the existing framework of sales tax laws in Arkansas. The changes would directly affect the overall tax liabilities of Arkansas residents, particularly benefiting low- and moderate-income families who often bear a heavier burden from sales taxes on essential goods. Furthermore, the bill could influence market dynamics by potentially lowering grocery prices and fostering increased competition among retailers. The effective date of the bill is set for January 1, 2026, allowing for a transition period for implementation.

Summary

House Bill 1685, known as the Grocery Tax Relief Act, seeks to amend the existing sales and use tax laws concerning food and food ingredients in Arkansas. The bill aims to exempt food and food ingredients from state sales and use taxes, aligning with the legislative intent to relieve grocery expenses for residents. The bill highlights a focus on essential commodities, ensuring that residents can access affordable food items without the added burden of state taxes. However, municipal and county taxes will still apply, allowing local governments to retain some level of taxation authority over groceries.

Contention

Key points of contention surrounding HB 1685 center on potential fiscal impacts. While proponents argue that it will aid families by lowering grocery costs, critics raise concerns about the implications for state revenue. The ongoing need for funding essential services, particularly in education and healthcare, could be jeopardized if substantial tax revenue is lost due to the exemptions proposed in the bill. There may be clashes among state and local stakeholders over how to balance tax relief with sufficient funding for public services.