LITTLE ROCK, Ark. – Arkansas Gov. Asa Hutchinson officially issued a call Friday for a special session of the General Assembly to address tax relief for state residents and improving safety in schools.
The call for the special session comes just over a month after the state wrapped up its fiscal year with a record surplus of more than $1.6 billion.
At that time, Hutchinson said he planned to call for the special session to look at ways to reduce the rate of tax collection in the state, though he waited until Friday to share the specifics of what he would cover with lawmakers.
Items on the agenda for the governor’s call include:
- Lowering the top individual tax rate to 4.9%, retroactive to January 1, 2022, which he claims will save taxpayers $295 million in 2022;
- Lowering the corporate income tax rate to 5.3%, beginning January 1, 2023;
- Creating a $150 nonrefundable low- and middle-income tax credit, which he claims will save taxpayers $156.3 million in 2022;
- Align Arkansas law with the federal depreciation schedule;
- Transfer $50 million from the state surplus for the purpose of a school safety grant program, consistent with the recommendations of the Arkansas School Safety Commission.
“As inflation rises and the cost-of-living increases, Arkansans need more money in their pockets,” Hutchinson said in a statement announcing the session. “With a record surplus in the last year fiscal year, we have the ability to provide financial relief and ensure our children can be protected in their schools.”
In response to the governor’s special session, the Arkansas Senate Republican Caucus issued a statement in support of providing a tax credit to hard working Arkansans.
“We’re delighted as a Senate Republican Caucus to be working collectively toward real tax relief for all Arkansans. The legislation being proposed will provide an individual tax credit to hard working Arkansans and will advance the tax cuts we previously passed. This will lower our overall tax rate, while at the same time giving meaningful relief to job creators in Arkansas who are dealing with the repercussions of inflation. The people of Arkansas need relief from burdensome taxes, and we as the Senate Republican caucus are excited to work with our colleagues in the House and our Governor next week to do just that.”
The $50 million allocated for school safety grants comes after the Arkansas School Safety Commission presented their interim report to the governor August 2. The program is designed to provide funding for school districts to increase security measures on campuses.
The Senate Republican Caucus also celebrated the safety grants, stating “With the start of the Arkansas school year just days away, it is imperative that we ensure the safety and security of our kids. To that end, we are looking forward to passage of $50,000,000 in grants that can be used across our state to secure our schools.”
While some parents may applaud the move to spend part of the state surplus on school safety, other have advocated using some of that money to increase teacher pay levels in the state.
Arkansas Education Association president Carol Fleming has said that the Natural State ranks near the bottom of teacher pay rates in the United States and that it needs to be addressed.
“Raising the minimum salary, for our educators around the state will allow us to be able to recruit and retain educators in the profession,” Fleming said.
The special session is set to get underway on August 8.