Arkansas Senate Bill 8 Summary

• Reduces individual income tax rates beginning January 1, 2022, with phased reductions continuing through 2025, contingent on state reserve fund conditions.

• Reduces corporate income tax rates for state and foreign corporations starting January 1, 2023, declining from 5.7% to 5.5% (2024) and potentially to 5.3% (2025) if Catastrophic Reserve Fund is not accessed.

• Renames the "Long Term Reserve Fund" to "Catastrophic Reserve Fund" and modifies revenue allocation procedures, with 75% of first $200 million in general revenues directed to the General Revenue Allotment Reserve Fund.

• Creates a $3,000 annual income tax credit for full-time law enforcement officers employed by state, local, or federal agencies who work at least 25 hours per week for 11 months.

• Indexes the standard income tax deduction annually to the Consumer Price Index (capped at 3% increase) and creates a new income tax credit for individuals with net income up to $24,700.