New income tax withholding tables
T he state Department of Finance and Administration has published new income tax withholding tables.
That’s good news for 1.1 million Arkansas taxpayers, because it means they will take home more money on their next paycheck. The adjustment to the tables was sent to about 80,000 businesses that employ more than a million Arkansans. The income tax cut was the major achievement of a recent special legislative session. The Legislature approved the governor’s proposal to reduce the state’s top individual income tax rate from 4.4 percent to 3.9 percent.
The Legislature has approved numerous income tax cuts over the past several years, but the current tax reduction took effect immediately and applies to tax year 2024. The tax cut will save Arkansas residents more than $256 million every year.
Most legislators and the governor say that Arkansas income taxes need to be lowered or repealed altogether, in order for Arkansas to compete economically with neighboring states. Every tax reduction makes it easier for the state to recruit industry.
The top corporate income tax rate is going down from 4.8 percent to 4.3 percent, saving 7,800 businesses based in Arkansas about $66.2 million every fiscal year.
In a recent speech, the president of the state Chamber of Commerce said that Arkansas is more economically competitive than it has ever been, largely due to recent tax reductions that have allowed businesses to pay higher wages and make more capital investments.
He also gave credit to recent positive changes in the collection of unemployment insurance taxes and favorable workers’ comp rates.
However, one issue continues to concern policy makers – the lack of skilled labor in certain sectors. It’s a reason legislators and officials of Arkansas colleges and universities support programs to recruit and retain more college graduates.
New Mississippi River bridge
Arkansas and Tennessee received grants totaling $393 million for their joint project to replace the Interstate 55 bridge across the Mississippi River at West Memphis. The bridge is 75 years old, and is narrower than the Interstate 40 bridge that crosses the river from West Memphis to downtown Memphis.
It is the largest grant ever received by the Arkansas Department of Transportation. The total cost of replacing the I-55 bridge is an estimated $800 million. In addition to the federal grant, Arkansas and Tennessee have each pledged $250 million toward the project.
Replacing the aging bridge is important to all Arkansas citizens, not just those in West Memphis, because of its statewide economic impact. As the governor noted when the grant was announced, West Memphis is where “America’s road, river and rail infrastructure meet.” The confluence of highway, railroad and barge traffic was a factor in the growth of the northeast Arkansas steel industry.
Improving traffic across the river along I-55 will solidify Arkansas’s role as a leader in transportation and logistics, the governor said.
Currently, traffic across the bridges averages about 48,000 vehicles a day, and by 2050 it will increase to an estimated 64,000 vehicles a day.
The new bridge will be larger than the existing one, and it will have more features to withstand earthquakes.
Sen. Reginald Murdock
