A new half-cent sales tax proposal got a nod of approval from the Arkansas Senate this week. If approved by voters in the 2020 general election, taxes would increase nearly $300 million per year on Arkansans. This is in addition to the new wholesale gas tax passed at the beginning of the week. The combined total for new highway funding is $418 million per year from the people of Arkansas.
Sponsored by Rep. Jeff Wardlaw (R – Warren) and Sen. Lance Eads (R – Springdale), the $300 million proposed constitutional amendment drew zero questions and no debate and passed in about one minute. A procedural move following the vote to hold the bill for three days drew more debate than the actual resolution. Even those who voted against the resolution – Senators Bart Hester and Bob Ballinger wanted to find a way to make sure the resolution was not delayed in getting out of the Senate Chamber.
The combined income tax cuts of $250 million over the past three legislative sessions have now been entirely wiped away with the new gas tax and proposed constitutional amendment (pending passage in 2020) with almost $400 million in new tax revenue coming from the people to government coffers. The state of Arkansas is on pace to increase spending by over $1 billion under Governor Asa Hutchinson’s two terms (8 years total).
Legislation filed to fund highways without raising taxes was not considered by the supermajority Republican legislature.