State lawmakers on the House and Senate Revenue and Tax committees are eyeing more tax cuts in the next legislative session and beyond.
Rob Moritz with our content partner, the Arkansas News Bureau, covered the Joint Revenue and Tax Committee on Tuesday.
Legislators were presented with a chart showing how reducing the income tax by .2 percent per year and .3 percent per year would affect residents’ tax brackets.
The chart showed that a .3 percent annual reduction would eliminate the income tax for people in the lowest income bracket, $5,000 or less annually, by 2018. People in the highest income bracket, $34,000 and up, would see their income taxes eliminated by 2038.
Rep. David Meeks, R-Conway, said eliminating the state income tax like some neighboring states have done, including Texas and Tennessee, would spur investment and economic growth in Arkansas.
Sen. Jake Files, R-Fort Smith, cautioned not to consider each individual tax cut in isolation of the others.
“I’m somewhat curious as to how cutting our income tax rates by a tenth of one percent makes us more competitive with Texas, who has no income tax, but who has personal property taxes that are extremely higher than ours are,” Files said.
“I think we’ve got to figure out a balance and look at these things not in a vacuum … (but) look at the whole package,” he said. “I’m sure many of you think we’re overtaxed but there’s a price to pay for that as well.”
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