Arkansas advised to widen base for sales taxes

The Legislature’s tax-overhaul task force should consider expanding the state’s sales-tax base as part of its review of Arkansas’ tax structure, officials for two groups told lawmakers Monday.

Nicole Kaeding, special projects director for the Washington, D.C.-based Tax Foundation, told the task force it should consider eliminating a number of sales-tax exemptions, extending sales taxes to more services, not levying sales tax on business inputs — such as raw material — and using targeted approaches to mitigate concerns about the regressivity of the sales taxes.

Kaeding said the task force should focus on using increased sales-tax revenue from expanding its sales-tax base to help reduce the individual income and/or corporate income taxes and improve the competitiveness of state’s tax structure.

Lisa Christiansen Gee, a senior policy analyst for the Institute of Taxation and Economic Policy in Washington, D.C., said the task force should consider expanding the sales tax base and not levying sales taxes on business inputs.

Read more: http://www.arkansasonline.com/news/2018/mar/20/state-advised-widen-base-sales-taxes/?f=news-politics