Governor Asa Hutchinson's plan to lower taxes for the middle class is now law. The governor signed into law a bill, SB6, on Friday. It lowers personal income taxes by a rate of one percent for those making 21,000 to 75,000 dollars a year. In a public signing, Hutchinson said cutting taxes for the middle class was his priority, but he is also open to cutting taxes for both higher and lower income brackets.
“Some say 'well, we need to have more tax cuts toward the job creators and others say we need to have more tax cuts for the lower income categories. The bottom line is we want to make sure that we can provide tax relief for Arkansans that help grow our economy. And I think we're united in that effort.”
Included in the tax cut legislation is a repeal of some of a capital gains tax cut approved by the legislature in the 2013 General Session. Hutchinson's income tax cut plan received widespread support from both chambers of the General Assembly.
At the ceremony Hutchinson praised the bipartisanship displayed in passing the bill. It passed by a vote with 31 yeas and 0 nays in the Senate and 95 yeas and 2 nays in the House. Hutchinson also praised the leadership of Sen. Jonathan Dismang, President Pro Tempore of the Senate and Speaker of the House Jeremy Gillam. He also thanked Rep. Joe Jett and Sen. Jake Files for their work as chairmen of the House and Senate Revenue & Taxation committees, respectively.
“My goal is to flatten the rates so we can be competitive with our other states. An that means that we've got to eventually lower it for the other income categories as well. But let's celebrate this today and wait down the road for the rest,” Hutchinson said.
SB6 reduces the tax rate for someone making $21,000 to $35,099 from 6 percent to 5 percent. Someone making an income in the $35,100 to $75,000 range will see their tax rate drop from 7 to 6 percent. The cuts take effect next year.