New Highway Tax To Take Effect In Arkansas

Jul 1, 2013

Arkansas's sales tax jumps by half a cent Monday with the proceeds funding state highway improvements.

Voters OK'd the temporary tax last year to help address a shortfall in highway funds. The $1.8 billion raised will be added to other revenue to provide $6 billion in road funding during the next decade.

State highway officials say Arkansas needs about $23 billion to tackle all the necessary projects. With the increase, Arkansas' new sales tax rate will be 6.5 percent.

The new state sales tax won't apply to groceries, gasoline or medicine. It is due to expire by 2023. Highway officials say they hope to issue bonds soon and start projects by the end of the year.