AP NEWS

Arkansas Senate approves $97 million income tax cut plan

February 7, 2019

LITTLE ROCK, Ark. (AP) — Arkansas’ Senate approved a $97 million plan to cut the top income tax rate on Wednesday, advancing a key part of the Republican governor’s agenda a day after the proposal fell short.

The Senate voted 28-5 in favor of Gov. Asa Hutchinson’s proposal to cut the top income tax rate from 6.9 percent to 5.9 percent over the next two years. The measure needed at least 27 votes to advance to the House and had fallen short of the votes needed a day earlier in the Senate.

“I am grateful for all the senators who supported the 5.9 percent tax cut plan and for the hard work displayed by senate leadership to achieve today’s successful vote,” Hutchinson said in a statement after the vote. “This commonsense approach to tax policy received more than three-fourths of the vote in the Senate. It has broad, bipartisan support, and that certainly gives it plenty of momentum as it goes to the House for final consideration.”

Twenty-five Republicans and three Democrats voted in favor of the tax cut plan, while all the no votes came from Democrats in the majority-GOP Senate. The proposal won the backing of two Democrats and a Republican who hadn’t voted Tuesday on the measure, including some who had cited the Legislature’s lack of action on highway funding as a factor for withholding their votes.

“My main concern was a couple things, but really infrastructure, and I was convinced that’s going to come up pretty soon. ... I just felt like the longer it stayed here on the floor, it would slow the process down,” said Democratic Sen. Eddie Cheatham, who voted for the measure.

Republican Senate President Jim Hendren said he reassured lawmakers before Wednesday’s vote that legislative leaders and Hutchinson are committed to coming up with a highway funding plan.

“My reason for wanting to get this tax cut behind us was so we could then focus on highways, not because I didn’t think highways were important,” Hendren said.

All five votes against the proposal came from Democrats, who have criticized Hutchinson’s plan as being skewed toward the state’s highest earners and coming at the expense of other state needs.

“Tax breaks are wonderful. Who wouldn’t want to have them? But in the face of so many important needs that we’ve not funded, that’s my biggest concern with it,” said Democratic Sen. Joyce Elliott, who voted against the bill.

The chairman of the House Revenue and Tax committee said he hoped to take up the proposal on Tuesday and that House leaders are gauging support.

“Anytime you go for a three-fourths vote, that’s obviously a huge lift,” Republican Rep. Joe Jett said.

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