AR HB1253

Adds new section 26-52-453 to Arkansas Code establishing a sales and use tax exemption for eligible construction materials used by the Arkansas Department of Transportation in public construction projects.

Defines "eligible construction material" as tangible personal property used directly in public construction projects that will remain part of the completed project or be consumed during construction, excluding equipment, tools, motor vehicle fuel, and other items that don't remain or aren't consumed.

Exempts gross receipts and proceeds from the sale of eligible construction materials from both the state gross receipts tax and the compensating use tax under the Arkansas Compensating Tax Act of 1949.

Applies only to construction projects initiated by the Arkansas Department of Transportation and paid for with public funds (state, political subdivision, or federal government funds), covering only the portion of projects funded with public money.

Declares an emergency and makes the act effective July 1, 2021, based on the finding that state highways, roads, streets, and bridges need construction and maintenance for economic development.