AR HB1038

Reduces the individual income tax rate on net income of $25,000 and above from 7% to 5.5% (2012), 4.5% (2013), and 4% (2014 and thereafter)

Imposes additional excise tax on sales and use of property and services (excluding food and food ingredients) at 1% (2012), 2% (2013), and 3% (2014 and thereafter)

Applies the same additional excise tax to tangible personal property and taxable services subject to use tax, with identical rate increases and food exemptions

Taxes are collected, reported, and paid using existing Arkansas tax collection procedures and timelines

Income tax changes are effective for tax years beginning January 1, 2012