LITTLE ROCK — The House Revenue and Tax Committee endorsed a $10 million tax cut proposal Thursday, as well as a tax increase approved by anti-tax icon Grover Norquist.
On a voice vote, with no "no" votes heard, the panel advanced House Bill 1039 by Rep. Jeff Wardlaw, D-Warren, which would exempt sales taxes on utilities for certain agricultural structures and equipment, including commercial chicken houses.
The committee approved the measure over the objections of the Beebe administration. Tim Leathers, deputy director of the state Department of Finance and Administration, testified that there is no room for the $10 million tax cut in Gov. Mike Beebe’s balanced budget proposal.
The panel then endorsed Senate Bill 5, by Sen. Bill Sample, R-Hot Springs, which would increase the state timber tax from 15 cents per acre to 20 cents per acre. Supporters say it would raise about $700,000 annually to aid the state Forestry Commission’s firefighting program.
Before the voice vote on SB 5, committee members received a copy of a letter from Norquist, the famously anti-tax leader of Americans for Tax Reform, informing them that if HB 1039 passed first, a vote for SB 5 would not be considered a violation of the group’s no-tax pledge even though it was a vote for a tax increase.
"This letter is a public statement that if HB 1039 is passed first, followed by SB 5, then Americans for Tax Reform will be certain to inform Arkansas taxpayers that your vote on SB 5 is NOT in conflict with the Taxpayer Protection Pledge because the effect would be a net tax cut," Norquist said in the letter.
Both bills go to the House.