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Paycheck$ and Politics Newsletter: Issue 28
Because of federal tax changes, the Arkansas’ estate tax expires on December 31, 2004 leaving Arkansas with yet another revenue gap. It is not too late to make the changes necessary to ensure that this fair tax remains a part of the Arkansas tax system.
The estate tax is one of the fairest taxes that a state can levy – placing the burden on only those with the greatest ability to pay.
Only 0.9 percent of Arkansans (less than one percent) would be affected by the estate tax.
The estate tax reduces the amount of revenue that has to be raised from sales taxes that place a disproportionate impact on low- and middle-income families.
Twelve states have recently decoupled from the federal government to keep their state income tax. In all, 18 states have their own estate tax.
Arkansas could keep its estate tax by decoupling from recent federal estate tax changes.
An Arkansas estate tax would raise an estimated $20 million dollars of much-needed revenue per year.
