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Report ranks Arkansas 9th in tax regressivity | Camden News

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Report ranks Arkansas 9th in tax regressivity | Camden News


WASHINGTON — Arkansas’ tax structure places a heavier burden on low- and middle-income families, according to a recently released report, with the state’s tax system ranked among the most regressive in the nation.

The Institute on Taxation and Economic Policy — a Washington, D.C., think tank focused on equity in tax systems — released its seventh “Who Pays?” report last week in which the organization analyzed local and state tax structures across all 50 states and the District of Columbia. The organization last released a “Who Pays?” report in 2018.

Arkansas has the ninth most regressive tax system in the latest ratings, a jump from 20th in the 2018 analysis. Florida has the most regressive tax structure, with Washington, Tennessee, Pennsylvania and Nevada completing the top five.

Analysts evaluated income taxes, sales and excise taxes, and property taxes in compiling the review. The lowest 20% of income earners nationally pay an average 11.3% share of their income in taxes, while the top 1% pay 7.2%.

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According to the report, 44 states have tax structures that “exacerbate income inequality” with lower-income households paying a larger proportion of their income in taxes compared with more affluent homes.

“When we look at how states are taxing their residents, it’s clear that they’re falling very far short of what most people consider to be a fair tax code,” Carl Davis, the institute’s research director, told reporters.

“Most state tax systems are regressive, which means the less you make, the more you pay,” he added. “A lot of times, we’ll call this an upside-down tax code because it’s the exact opposite of the kind of progressive taxation that a huge swath of the public supports.”

In Arkansas, the lowest 20% of income earners have a 13.1% share of their income in taxes while the top 1% pay less than half of this percentage at 5.8%, according to the report. The middle 20% of earners have an 11.7% income share going toward taxes.

According to researchers, Arkansas’ current placement stems from the increased dependence on sales and excise taxes. Around half of Arkansas’ tax revenue for the 2023 calendar year came from these taxes.

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Tennessee and Louisiana followed a similar pattern with more than half of their tax revenue coming from sales and excise taxes. Louisiana placed 10th on the organization’s list.

“Arkansas does have both a reliance on sales taxes but also one of the highest combined sales tax rates in the country,” said Jeremy Horpedahl, director of the Arkansas Center for Research in Economics at the University of Central Arkansas.

Neither Horpedahl nor the center worked on the report.

“When we look at what people are spending their money on, low-income families are spending a much bigger share of their income, which means a much bigger share of their income is hit by the sales tax,” Horpedahl said. “Groceries — while we exempt them from the state sales tax — are included in local sales taxes, and city and county sales taxes have gone up quite a bit in the past few years in Arkansas.”

Other factors affecting the state’s ranking include the lack of earned income and child tax credits, as well as capital gains tax breaks, according to the report.

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Florida Policy Institute CEO Sadaf Knight said another element involves personal and corporate income tax reductions. State political leaders have passed multiple cuts since Republicans took control of the governor’s mansion and state legislature in 2015.

“They’ve done so in a way that overwhelmingly benefits [to] the highest-income families in the state,” she said. “That shifted the tax system to become more regressive over the years.”

According to the report, if Arkansas had not reduced its personal or corporate income tax rates since the 2018 report, the bottom 20% of income earners would pay a similar income share on local and state taxes, but the top 1% would pay 7.3%. The state would still have a regressive tax structure, but Arkansas would instead place 15th.

“When you have very low property taxes and reducing the personal income tax in this way, it means that the lion’s share of your revenue is going to come from taxing what people buy through sales and excise tax,” Davis said. “When you structure your system that way, you’re going to have a lot of regressivity in it.”

During last September’s special legislative session, Arkansas’ state legislature approved reducing the top individual income tax rate from 4.7% to 4.4% and the state’s top corporate tax rate from 5.1% to 4.8%, both of which took effect Jan. 1.

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Horpedahl took exception with the report’s handling of corporations conducting business across states. He made note of the presence of multiple companies headquartered in Arkansas, such as Walmart, with domestic and international operations.

“If you’re a business located in Arkansas and you sell things in another state, who bears the burden then of the corporate income taxes paid? This report essentially ignores that because, I think, it’s just really hard to do that,” he said.

“I don’t think it means the results are totally meaningless, but I think it does mean we are missing some of those taxes that the top 1% are paying in Arkansas, which means we are not as regressive as this report suggests.”

The report received strong disapproval from Jared Walczak, vice president for state projects at the Tax Foundation. Much like the Institute on Taxation and Economic Policy, the Tax Foundation is a Washington, D.C.-based tax policy organization, albeit with an emphasis on proposals fostering economic growth.

“The broader issue is progressivity is achieved in two ways,” Walczak said, “by how governments raise revenue and how governments spend revenue.”

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Walczak argued the lowest-income earners — unlike high-income households — receive net government transfers and benefits on top of earnings, which the Institute on Taxation and Economic Policy did not consider in its report.

“At the state level, spending systems are highly progressive while tax systems typically are not because states have to compete with each other for jobs, people and businesses,” he said. “Therefore, they have often been content to let most of the progressivity take place in both the spending codes and the federal government with its progressive tax and transfer system.”

Alexa Henning, communications director for Republican Gov. Sarah Huckabee Sanders, also criticized the report.

“Democrats and liberal advocacy groups like the Institute on Taxation and Economic Policy oppose Governor Sanders’ tax cuts because they think government spends the American people’s money better than the American people themselves,” Henning said.

“The Governor passed tax cuts that benefited every taxpayer in Arkansas and helped spur Arkansas’ economic growth by returning $300 million to families and businesses last year.”

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The Institute on Taxation and Economic Policy placed the District of Columbia as the least regressive tax system, followed by Minnesota, Vermont, New York and California. Researchers stated, however, none of the tax systems are “robustly progressive in a traditional sense,” noting uneven curves in rising tax shares.



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Arkansas

Arkansas medical marijuana sales up more than 6% through May – Talk Business & Politics

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Arkansas medical marijuana sales up more than 6% through May – Talk Business & Politics


Arkansas medical marijuana sales in the first five months of 2025 totaled $121.024 million, up 6.3% compared with the same period in 2024. Overall pounds sold in the first five months was 32,474, above the 30,000 in the same period of 2024.

Medical marijuana sales totaled $275.9 million in 2024, just below the record of $283 million in 2023.

“Tax revenue from medical marijuana is averaging $2.68 million a month in 2025, also an increase over last year,” Scott Hardin, spokesperson for the Arkansas Department of Finance and Administration (DFA), said in a statement. “With daily medical marijuana sales averaging $806,000, we are on track to surpass the 2023 sales record of $283 million.”

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Following are the top five dispensaries, among the state’s 37 licensed dispensaries, for pounds sold in May.
Suite 443 (Hot Springs): 692.98 pounds
Natural Relief (Sherwood): 626.54
Harvest (Conway): 422.78
CROP (Jonesboro): 401.24
Custom Cannabis (Alexander): 363.13

The Arkansas Department of Health reported 109,854 active patient cards, up 12.8% compared with the 97,374 to begin 2024.

Following are the annual sales since 2019 when medical marijuana sales began in Arkansas.
2024: $275.9 million
2023: $283 million
2022: $276.3 million
2021: $264.9 million
2020: $181.8 million
2019: $31.32 million

The constitutional amendment legalizing medical marijuana for 17 qualifying conditions and creating a state medical marijuana commission was approved by Arkansas voters 53% to 47% in November 2016.

Taxes collected are 6.5% of regular state sales tax with each purchase by a patient and a 4% privilege tax on sales from cultivators to dispensaries. Most of the tax revenue is placed in the University of Arkansas for Medical Sciences National Cancer Designation Trust Fund. The state also collects a cultivator privilege tax, which means tax revenue is not always tied to how much product is bought by consumers at dispensaries and the price for the product sold to dispensary customers.

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Arkansas Times reporter snags two Local News Awards from Report for America – Arkansas Times

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Arkansas Times reporter snags two Local News Awards from Report for America – Arkansas Times


The national journalism nonprofit Report for America announced the winners of its fifth annual Local News Awards last week, and our very own agriculture and environment reporter Phillip Powell came away with not one but two honors.

RFA is a national service program that aims to address the decline of local journalism by placing reporters into local newsrooms and covering a portion of their salary. Powell, a 2025 RFA corps member and Arkansas native, came to the Arkansas Times last summer as part of RFA’s collaboration with the Mississippi River Basin Ag & Water Desk. Since then, he’s covered Arkansas ag and enviro issues large and small, from the impact of tariffs on Arkansas soybean farmers to a local fight over an air-fouling waste lagoon near Fort Smith.

RFA’s honors outstanding reporting produced by the group’s corps members over the past year with its Local News Awards. Powell took the silver medal in the “News” category for a story on the Arkansas Legislature’s efforts this spring to restrict the growth of wind power in the state, titled “Breaking wind: Proposal would split Arkansas in two for wind energy regulations.” (The specific bill described in this story did not pass, but in the final days of the legislative session, the Republican majority ultimately did enact stringent new rules that wind advocates say could strangle the nascent industry in Arkansas.)

Powell also took home a third-place prize in the “Enterprise/Investigative” category, shared with fellow RFA corps member Lucas Dufalla of the Arkansas Democrat-Gazette. Dufalla and Powell co-reported a story titled “Delta duck hunting offers conservation solutions, but the ducks are disappearing,” which appeared both in the Dem-Gaz and the Arkansas Times in April. A part of a Mississippi Ag & Water Desk series on wetlands, it details the destruction of duck habitat in the Arkansas Delta and the uphill battle faced by conservationists.

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According to RFA, the group’s 2025 Local News Award winners were selected from more than 200 pieces of reporting produced by 102 reporters around the country. “Reporting spanned homelessness, mental health, climate change, racial equity, rural shifts, environmental justice, and political extremism, in communities from Albany to Appalachia, Concord to Cedar Rapids, and Birmingham to San Francisco,” RFA said — which makes Powell’s collection of two awards this year all the more notable. Congratulations, Phillip! 

And while we’re on the subject: If you’re as impressed with Powell’s reporting as we are, consider supporting his work. RFA helps small newsrooms like the Arkansas Times hire reporters like Powell, but the nonprofit covers only a portion of the salary. The rest comes from other sources, including local donors. You can contribute here.



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Arkansas 1 of 2 states listed as having ‘comprehensive, coherent’ approach to elementary math instruction | Arkansas Democrat Gazette

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Arkansas 1 of 2 states listed as having ‘comprehensive, coherent’ approach to elementary math instruction | Arkansas Democrat Gazette


While all states need to do a better job of preparing and supporting elementary school educators to teach math, Arkansas outperforms most in its efforts to ensure teacher effectiveness in the subject, according to the National Council on Teacher Quality.

In a report released by the Washington, D.C.,-based research organization Tuesday, the Natural State and Alabama were listed as the only two states in the U.S. taking a comprehensive, coherent approach to preparing teachers for math instruction in the classroom.

“We’re kind of looking at the arc of a teacher’s career from before they get into the classroom to once they’re in the classroom, all focused on this question of, ‘How can we ensure that teachers are well prepared and well supported to be effective in teaching math in elementary school,’” said council President Heather Peske.

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The group’s goal was to analyze state laws, regulations, policies and tactics that either aid or hinder the strengthening of teachers’ ability to teach math well, Peske added.

Each state was rated based on how their policies aligned with five policy levers — carried out through 16 associated actions — most important for improving math instruction, and consequently, math understanding for students, according to the report.

The policy levers identified were setting specific, detailed math standards for teacher preparation programs offered by colleges and universities; adequately reviewing the preparation programs; requiring all elementary teacher candidates to pass a strong math licensure test; requiring districts to select high-quality math curricula aligned to state standards; and professional development and ongoing support for teachers.

The key actions supporting these policies ranged from whether the state requires elementary teacher preparation programs to address math-specific teaching methods to whether states are publishing data on how many teacher candidates are passing math licensure exams.

Arkansas ranked above the national average across most of the policy levers, earning a “strong” rating for setting clear and detailed math standards and for adopting a strong math licensure test that all teacher candidates must pass. The state’s review of its teacher preparation programs was initially given a “moderate” rating, but that was increased to a strong one after the council discovered Arkansas maintains full authority over program approval, a spokesperson for the council told the Arkansas Democrat-Gazette last week.

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This change in policy lever rating resulted in Arkansas’ overall rating shifting from “moderate” to “strong.”

A main finding of the council in its report was that just two states utilize a comprehensive approach to math instruction, Peske said, adding that “it’s really critical that” teachers are getting content knowledge which aligns with the four key math topics: numbers and operations; algebraic thinking; geometry and measurement; and data analysis and probability.

Arkansas “is specific and detailed in telling teacher preparation programs what they need to do in terms of these four key math content topics, and the state also requires elementary teacher prep programs to address the methods of teaching math — or what we call math pedagogy,” Peske said.

Not only does Arkansas provide detailed standards, but the state also “follows through” by requiring a review of preparation programs, syllabi and coursework to ensure math standards are reflected in what aspiring teachers are learning, Peske said.

COUNCIL’S RECOMMENDATIONS

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When it comes to requiring districts to select high-quality instructional materials for math as well as providing professional learning and coaching once teachers are in the classroom, Arkansas has some room for improvement, the council said in its report.

“High quality math curriculum along with supporting implementation can help to increase the effectiveness of a teacher,” Peske said, noting that the council is “urging” states to require school districts to utilize materials considered high quality.

Peske added that “Arkansas is missing an opportunity to really support teachers” by failing to collect and publish data on the curriculum that districts are using as well.

Support around the implementation of high-quality instructional materials as well as math coaches and specialists in schools would also improve the state’s overall approach to educator effectiveness in math, Peske said.

Arkansas Education Secretary Jacob Oliva said that while districts are given leeway to select their own curriculum for math, the state Department of Education does provide a recommended list of high-quality materials school districts are encouraged to choose from.

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Arkansas has taken some of the steps recommended by the national council’s report on math instruction in its approach to literacy education, and Oliva said similar strategies could be implemented for math instruction in the future.

For instance the state requires districts to choose from a list high-quality literacy materials and publishes information what materials districts are using.

Arkansas has been moving toward the “science of reading,” or a research-based strategy designed to teach students how to read, Oliva said, adding that the state’s efforts include “making sure that all of our professional development and instruction materials are aligned” with the national method of teaching literacy.

“It’s almost like we are getting to this point on a national educational landscape around the need to do a big push around the science of math, like there was a big push around the science of reading,” he said. “A lot of people are realizing that it’s a balanced approach between the core content areas.

“Those third-grade benchmarks on if students can read at or above grade level are grade-level predictors for future success. It’s going to be the same way for math.”

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THE LEARNS ACT

Beyond the policy areas mentioned in the national council report, the Arkansas LEARNS Act of 2023 established several programs aimed at improving student achievement in both math and literacy.

The law established the High-Impact Tutoring Pilot Program, which tasks the Education Department’s Division of Elementary and Secondary Education providing competitive grant funding to school districts to cover costs for K-12 math or literacy tutoring.

The education secretary added that levels of support needed vary across classrooms, grade levels and schools, meaning that a “unified, coordinated system” to address student-specific needs from kindergarten through 12th grade is needed.

Once teachers are in the classroom, Oliva noted that educators have access to myriad professional learning opportunities and resources geared toward state student and educator standards.

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He also noted that the Merit Teacher Incentive Fund Program established through the LEARNS Act awards up to $10,000 in annual bonuses to educators who demonstrate a substantial impact on student growth, mentor aspiring teachers, teach a subject within a critical teacher shortage area or teach in a geographical area with a teacher shortage.

Oliva said the state asks recipients to share best strategies with the department and other educators.

“The more you can build out a teacher’s toolbox, the better off they’re going to be to support all the different needs of the students,” Oliva said.

Arkansas provided more than 120 literacy coaches to K-3 teachers in D- and F-rated schools across the state during the 2024-25 school year — another provision of the state’s K-12 education overhaul act from 2023. Oliva noted that, depending on whether literacy coaches prove to have a positive impact on student assessment scores, the state “might” consider implementing similar measures for math.

MATH ACHIEVEMENT

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“Right now, in Arkansas and across the nation, our students are not achieving well in math,” Peske said. “And if we want students to be successful, we need to better prepare and better support elementary teachers in their math instruction.”

Beyond improving students’ assessment scores, stronger math skills lead to better reading scores and college readiness, which positions students to achieve higher earnings later on, she added.

Between 2019 and 2024, average math scores from a representative sample of Arkansas fourth-graders showed no significant change despite a nationwide trend showing an average overall decrease in math scores during the same time, according to results from the 2024 National Assessment of Education Progress.

The state’s scores also remained relatively unchanged between 2022 and 2024 when the national trend showed an increase.

According to the 2024 results, Arkansas fourth-graders performed, on average, 7 points below the national average, the largest gap between math scores of Arkansas test takers and the national average since 2000.

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Nationally, students showed small gains, particularly in math and among higher-performing students, between 2022 and 2024, with Alabama being the only state to see fourth-grade math scores last year exceed pre-pandemic scores.

“We know there are opportunities to improve” on state standardized assessments and national assessments, Oliva said.

“So when we look at those recommended actions for steps to take, we want to be reflective and be diligent, make sure we’re able to implement what we know is going to be effective for our students,” he added.

As for states’ educator preparedness policies for related to math instruction, a majority of states do not provide clear and detailed standards for teacher preparation programs, use a strong or acceptable math licensure test or require districts to select high-quality math curricula, according to the national council’s report released Tuesday.

Seven states — Arizona, Hawaii, Maine, Missouri, Montana, Nebraska and New Hampshire — were rated unacceptable by the council for their “lack of math policy action” across all five policy levers, the report stated.

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