The Arkansas House on Friday approved several tax cuts bills, including proposed cuts to the state's income taxes and capital-gains taxes.
The Arkansas Democrat-Gazette reported Friday that legislative measures would combine to reduce state general revenue by $9.9 million in the 2014 fiscal year, $84 million in the 2015 fiscal year and $140 million the 2016 fiscal year, Senate Revenue and Taxation Committee Chairman Jake Files, R-Fort Smith, said.
Files said the tax cuts would be funded in 2015 and 2016 by state savings from the implementation of the "private option," which recently passed both chambers of the Arkansas Legislature and is to be signed into law by Gov. Mike Beebe on Monday.
Beebe has said he plans to sign the tax cuts into law, but said the proposals could become a problem in coming years.
House Bill 1585, sponsored by Rep. Charlie Collins, R-Fayetteville, which would reduce the state's general revenue by $2.5 million in 2014, $30.4 million in 2015 and $55.7 million by 2016, according to Files, was approved by the House on Friday.
Rep. Kim Hammer, R-Benton, spoke in favor of the bill, but said the possibility of a perfect storm is there in fiscal year 2016 and 2017, especially if the federal governments decides not to fund Arkansas' "private option" plan.
House Bill 1966, sponsored by House Speaker Davy Carter, R-Cabot, concerning cuts to capital-gains taxes and increasing the standard deduction from $2,000 to $2,200 beginning in Jan. 1, 2015, also gained approval from the House.
Senate Bill 5, sponsored by Sen. Bill Sample, R-Hot Springs, which would add funding to the Arkansas Forestry Commission passed the House, 75-10.
House Bill 1039, which would grant a sales tax exemption for energy used by agricultural structures, and House Bill 1399, which would make volunteer firefighters eligible for an income-tax deduction, up to $1,000 a year, also passed the chamber.
Read more in Saturday's Arkansas Democrat-Gazette.