Revenue and Tax committee advances tax credit bills

The House Revenue and Taxation Committee on Tuesday (April 13) advanced a slew of tax credit bills while declining to advance a bill that would transfer excess medical marijuana sales tax revenues from the University of Arkansas for Medical Sciences to a fund for medical residents.

Among the bills advanced April 13 were the following.
• House Bill 1157 by Rep. David Tollett, R-Lexa, would increase the income tax deduction for a teacher’s classroom expenses from $250 to $500 per taxpayer, and from $500 to $1,000 for married taxpayers filing jointly when both are teachers.

• House Bill 1196 by Rep. Craig Christiansen, R-Bald Knob, would exempt water used in poultry farming from sales taxes. Water used by the farmer would be metered separately from water used for other purposes. Christiansen said all but one surrounding state provides such an exemption, and the exemption is already provided for pork in Arkansas.

• House Bill 1513 by Rep. Jon Eubanks, R-Paris, would create a credit of up to $3,500 for work by retired law enforcement officers investigating cold cases for the Arkansas State Police. Chief Bill Bryant said one person is providing that service, and the State Police would like to expand it to three with wages of $25 per hour. Bryant said the State Police currently have more than 30 cold cases. Under the bill, a total of $25,000 in credits would be available on a first come, first served basis.

• House Bill 1555 by Rep. Joe Jett, R-Success, the committee’s chairman, would increase the annual cap on the state’s historic rehabilitation income tax credits from $4 million to $8 million. The 25% credit can be claimed for investments on qualified historic properties, including those listed on the National Register of Historic Places.

• House Bill 1596 by Jett would add “printing” to the list of manufacturing items sold for resale that are exempt from sales tax.

• House Bill 1641 by Rep. Les Warren, R-Hot Springs, would provide a sales tax exemption for purchases to the YMCA, of which there are two left in Arkansas, Warren said.

• House Bill 1054 by Rep. Rick Beck, R-Center Ridge, would allow sales tax exemptions for isolated sales at special events. Other states have such exemptions, he said.

• House Bill 1314 by Rep. David Hillman, R-Almyra, would increase the tax credits available for water development projects under the Water Resource Conservation and Development Incentives Act.

The committee also advanced House Bill 1698 by Jett, which would allow the state to use delinquent real and personal property taxes as a setoff against taxpayers’ state tax refunds.

It also advanced House Bill 1509 by Rep. Karilyn Brown, R-Sherwood, which would change the name of the Arkansas Tax-Deferred Tuition Savings Program to the Arkansas Brighter Future Plan Act and would align the 529 tuition savings plan with changes in the federal tax code.

Representatives advanced Senate Bill 528 by Sen. Bill Sample, R-Hot Springs, which would limit what the Arkansas Department of Finance and Administration tells city and county governments about a taxpayer’s sales tax credits and rebates. DFA would be required to deliver monthly electronic reports about the amounts of the credits and rebates to the impacted city and county governments. Sample said the bill was written by the Department of Finance and Administration.

Also, a bill that would have transferred excess funding raised by medical marijuana sales taxes to the Graduate Medical Education Fund failed for lack of a motion. That money is all going to the University of Arkansas for Medical Sciences National Cancer Institute Designation Trust Fund. Lawmakers in 2019 voted to send money to the UAMS fund in order for the medical school’s Winthrop P. Rockefeller Cancer Institute to become an NCI research center.

But House Bill 1841’s sponsor, Rep. Dr. Lee Johnson, R-Greenwood, said more money is being generated than expected. The bill would designate the first $20 million raised annually to the NCI fund and then would dedicate remaining funds for medical residencies, which Johnson said are critically needed in Arkansas. He said he was working with UAMS.

But several members of the committee expressed concerns about taking money from UAMS, and when Jett asked for a motion, no one offered one.