New law reduces state’s top income tax rate

KNWA

FAYETTEVILLE, Ark. (KNWA) — A change in Arkansas tax law means people could pay less in income taxes starting this year.

Those making a little more than $35,000 a year are considered a part of Arkansas’ top income tax rate, said Bill Nystrom, a Keen & Company public accountant in Fayetteville. Prior to 2020, people in that bracket were required to pay a 6.9% tax rate.

The new law, Senate Bill 211, reduces the tax rate to 6.6%.

The bill’s language said the top tax bracket is due for some help after low and middle-class brackets got reductions in recent years. Nystrom said many Northwest Arkansans will benefit from this even if the reduction isn’t too significant.

Mark Foster is the education director for Credit Counseling of Arkansas, and he said much of the same.

“Of course, we’d like to go from 6.9% to 1.9%…in a perfect world, that would be nice,” Foster said. “Usually, it’s smaller increments, but it’s more money in our pockets, so we’ll take what we can get.”

The rate will drop again to 5.9% in 2021. The moves are a part of Gov. Asa Hutchinson’s “5.9 Tax Plan” signed in February 2019.

Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Latest Video

Local News Video

DON'T MISS

More Don't Miss

Trending Stories

Mega Millions & Powerball Numbers