AEDC Director: Lowering income tax below four percent ‘sends a message’

Arkansas Economic Development Commission Executive Director Clint O’Neal said efforts to lower Arkansas’ top personal income tax rate below four to cent as well as lowering the corporate income tax rate will open the door to more businesses in the state.

Governor Sarah Sanders calls the Arkansas General Assembly into session Monday, June 17 to reduce personal income tax rates from 4.4% to 3.9%, corporate tax rates from 4.8% to 4.3% and to increase the homeownership tax credit by an additional $75. at $500 for owners.

Appearing on this week’s edition of Talk Business & Politics, O’Neal said the tax cuts expected to pass this week in a special legislative session are psychological and tangible.

“It’s important to us. This is our message to all of our Arkansas business owners, to business leaders who are looking for Arkansas to be a good place to do business: No matter what the incentive package is, it benefits everyone. world,” he said.

“I think there’s something important about going below four percent. And just the story that Governor Sanders cut taxes twice, only to come back a third time. If we look even further back, over the last ten years, where we were from 7% to today less than 4% on the personal side, with an additional half a percentage point drop in the On the business side, this sends the message that other states are not doing this. Sending in progress. Other states are sending the message that we are struggling to balance our budget. The only way to make up for this is to raise taxes. Our message is that we are preparing to cut taxes because we have been fiscally responsible,” Mr. O’Neal said.

The tax cuts have been implemented over the past decade and will be bolstered by the fact that Arkansas is expected to end its fiscal year on June 30 with a surplus of more than $708 million. Sanders and lawmakers plan to place $290 million in a restricted reserve fund.

O’Neal said there is a wide range of projects being considered for development in Arkansas and the United States. The presidential election cycle could delay some of these projects, but many site visits and expansion plans are being considered.

“I think it’s at an all-time high,” he said. “It’s a presidential election year, which generally puts certain major investment projects on hold. We see a lot of things sort of stuck in the pipeline, very eager for good jobs announcements. We’ll definitely have some in the coming months, so stay tuned for that.

O’Neal discussed some recent successes and setbacks in the interview:

On Windsor Door, which this week announced a $21 million expansion of its production line: “It’s a sign of confidence that the workforce here in Arkansas is doing the work for them.” May the business climate facilitate growth.

On Westrock Coffee, which opened its $315 million Conway facility early: “Such an inspiring story, how it helps Arkansans with jobs, a great consumer product and they help the coffee farmers of the world entire. »

Regarding Hino Motors, which announced the closure of its Marion plant and the layoff of 1,300 workers: “We are very engaged with the local leadership team in Marion as well as the Hino government affairs team. They’re reporting right now that they’ll be operational until mid to late 2027. So there’s not much we can do right now, but you’re definitely starting to lay the groundwork, like we did for others, unfortunately last year, who announced layoffs.

You can watch O’Neal’s full interview in the video below, where he also talks about a new site development program that better prepares communities for economic development projects.

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