Proposals for Arkansas Tax Break, Sales Tax Holiday Filed

DECEMBER 12, 2006 - Posted at 7:40 a.m. CST

LITTLE ROCK (AP) - Lawmakers have filed bills for next month's session that would create a sales tax holiday and a two-year, 3 percent income tax break to pay back Arkansans for a temporary surcharge.

These bills are part of a growing list of proposals made for the state's surplus _ projected to grow to $843 million  - as legislators prepare for the session beginning in January.

Representative-elect Clark Hall, a Democrat from Marvell, filed legislation that would create a sales tax holiday on the first weekend of every August. During that weekend, no sales taxes would be applied for purchases of clothes, school supplies, computers, computer software and computer equipment.

State Senator Kim Hendren filed legislation that would reduce every Arkansas taxpayer's tax liability by 3 percent in 2007 and 2008.

Hendren, a Republican from Gravette, says the proposal would pay taxpayers back for a 3-percent income tax surcharge that the Legislature imposed in 2003 to help cover a budget shortfall and head off threatened cuts in Medicaid programs and prison operations.

(Copyright 2006 by The Associated Press.  All Rights Reserved.)