May 8, 2003
Posted at: 7:28 p.m. CDT
LITTLE ROCK, Ark. -- Governor Huckabee has signed a bill that raises taxes to plug a $110 million hole in the state budget.
Huckabee says he is pleased with the way legislators worked to put together a budget and fully fund its programs. The House and Senate agreed on the tax bill earlier today.
The bill increases wholesale tobacco taxes and institutes a temporary three-percent surcharge on state income taxes. An amendment added in the Senate extends the surcharge until 2006, but bases its amount on state revenue projections.
With the bill signed into law, legislators' major work on the core state budget will be complete.
They still have more work to do on the general improvement fund and set state spending priorities.
In addition to the income tax surcharge, the tax increase bill raises wholesale taxes on cigarettes by 25 cents per pack. It also increases wholesale taxes on other tobacco products by seven percent.
The money will plug a revenue shortfall and keep help fund human services, prisons and college scholarships.