Arkansas Legislative Panel Passes Sand Tax Exemption

Mar 5, 2014

An Arkansas legislative panel has endorsed a measure exempting sales tax collection on the sand used in the drilling of oil and natural gas.

The Joint Budget Committee approved the amendment Wednesday to the state Department of Finance and Administration's Revenue Services Division budget bill.

The proposal failed Tuesday, but Sen. Jonathan Dismang asked for the vote to be erased, citing the absence of several committee members.

A Pulaski County circuit judge has ruled that sand qualifies as equipment, meaning taxes can't be collected on it. Lawmakers say they're clarifying the law to follow the judge's decision.

Department of Finance and Administration officials oppose it, saying the amendment is inappropriate in a fiscal session. They plan to appeal the judge's ruling.

The bill now heads to the full Senate.