Revenue & Taxation- House

without objection house bill ten twenty six representative ray. And I believe you have an amendment. I got you. As a. Members get ready to pass out the amendment to take a look at that and then that you're okay with that we'll need them motion here to minute to adopt the amendment. Thank you. I representative ray you're recognized to explain your bill and also in then your amendment you may explain the amendment first or. Nice to be need to explain the bill covers and we'll get to the amendment okay all right thank you Mr chairman and colleagues about the opportunity to present house bill ten twenty six this is a very simple bill it would prohibit local local governments from levying an income tax. Currently there are no cities or counties in the state of Arkansas that levy an income tax so we're considering this bill is a good time when you're not having to try and put the toothpaste back in the tube so to speak But even though we don't have any local income taxes in Arkansas there are seventeen states around the country where they do levy local income taxes in fact there are four thousand nine hundred sixty four taxing jurisdictions around the country to do most of these are in rust belt states in the northeast the vast majority of them are cities but there are a smattering of counties and even school districts that that levy local income taxes if you've never lived in one of the states it it may seem a bit surprising because it's not very common in the south but I would for example has two hundred and eighty jurisdictions where they levy local income tax Kentucky has two hundred and ten such jurisdictions Ohio and Pennsylvania have substantially more I think Ohio has almost eight hundred and fifty local jurisdictions that levy an income tax. And I think most of the folks on on this committee would agree that as far as taxes go income taxes or perhaps some of the most economically damaging they they dis incentivize work and labor and productivity all things that we want more of in society and and they present barriers to economic growth. I think there's a lot of reasons to support this bill but the the main reason in my mind is it it's been the policy of this body for the last eight years to consistently lower and reduce the income tax in our state and with where we are headed in the future I only see that trend continuing as we continue to lower with hopefully the ultimate goal many years from now to phase out of the income tax and so the last thing that we would really want is to go through all that hard work of doing this and then have that tax burden back field on the on the local and Regis be shifting the tax burden from the state to the local level and so that's the purpose of the bill the purpose of the amendment is just add an additional section of code that we identified that a let that that dealt with local income tax so it's just fine it's just about striking an additional section a code that that mentions us. Thank you for that members any questions on the bill or the amendment. All right all right members missing no questions is anyone in the audience would like to speak for against this bill. All right we have a question for given a by representative Jean Paul you would mind. Good morning Mr chairman as the committee Paul Goehring DFA. What recognized representing language chairman of this hearing if you all had time to review the amendment in the bill representing we did review the amendment I'm sorry the original bill we did not identify any fiscal impact to the state of Arkansas so D. if they had made the decision not to issue a fiscal impact statement on this bill well I would work but impact statement because I knew that would be one but it the way it's written did you see anything of any problems that the that the the way the bills written no Sir I did not see any problems with the way the bill was written okay thank you thank you thank you representing members any other questions of the FNA. All right thank you appreciate you coming down. Representative ray would you like to make a motion to adopt the amendment I would do pass thank you Mr The Amendment yeah we need to know is are trapped amendment by yes I move do pass on the amendment. We need a motion to adopt the amendment I moved to adopt the amendment all right the president but was well yeah all right members have a motion to I make a motion if you like your bill thank you Mr I'm closed and I move do pass. As amended as amended all right we have a motion do pass as amended all those in favor signify by saying aye. Opposed congratulations your bills passed. I remember that takes us to house bill eleven forty three. representative fight. In the room. Member just hold me just a second let's make sure representative fight is either not coming or is on her way so bear with me for one moment. I members representative fight is on her way actually there she is right there that was quick all right representative fide you're recognized to print up to present house bill eleven forty three. Thank you Mr chairman committee sorry I got held up in education and it's still going on I would like to bring to the table with me Josh Curtis. And I believe we also have some county clerks here with this if I could bring them forward absolutely. Collectors I'm sorry collectors not Clark's. And I will ask them to introduce themselves to you. Morning Mr chairman committee thank you for your time I'm here for represented five represent the collectors association if there's any tough questions of a for to them. My name is Rebecca tell for and I am the Garland County collector. I am Laurie Pennington I'm actually County collector. Again welcome to the committee representative fine you're recognized to present your bill thank you Mr chairman the title of the bill really tells you all you need to know about this it is to amend the property tax exemption for disabled veterans surviving spouses of disabled veterans and minor dependent children the disabled veterans and especially we wanted to define homestead that has been a problem in the past for this particular group and so we felt that clearing clearing up what that means would be very beneficial not only in our county offices but for the veterans themselves and I'm going to ask of Mr Curtis and our collectors to explain more of our reasoning on that. In the past it has not been unified throughout the state on how the collectors have handled the disabled veterans and we have tried the last few years to rectify that and make sure that we handle all the victories. The same way and if they move from county to county they receive the same benefits in each county so we're trying to define this so that everybody receives. The same homestead so it's not just. If I live in that out inside in a rural area they don't get their house plus five acres or their house and everything around it so that we know exactly what we're supposed to. An exit for the L.. Thank you for that. The challenge in a representative by the excuse me the did you have anything more you want to add to that. Would you like to add something to this okay Josh yes as Rebecca said we're just trying to clarify make this more consistent this is really codifying AG opinion we got a long time ago dealing with this definition this definition there's several homes the definitions in the code but the home DVD home said definition there wasn't at home so definition for this specific code so we want to clarify that make consistent where all the collectors are working off the same sheet of music and all the that trends are getting the exact same benefits whether it's in garland county or Ashley County. All right. I thank you members any questions representative right you're recognized. Thank you Mr chairman you know couple years back you know we had a the home state property taxes started about two thousand and you know we had problems people switching from one side of the state and having more than one is there some kind of a safeguard in this folks that will actually let them know to pull off on one county or one city and and up pull up on other. Represent route this this bill doesn't address the home state credit that just just regular or cans have this addresses specifically the disabled veterans homestead exemption. Yes but one of the old one ACT scores it if you have one let's just say in Clay County and you moved to say slang County what we have in place that would drop off of the the first county to the second. In our county when you move in to our county we called the previous County to see what they were exempt on to see when they moved and we get a copy of their letter previously from that county of their new for our county and we coordinate with the with the county they move from to make sure that they're not double exempt. As a good answer thank you very much thank you Mr thank you and this is very narrowly defined this is specifically for disabled veterans and their spouses and minor dependents. Representative Warren you're recognized. Thank you Mr chair of Rebecca if you would we talked right before would you explain the which I've run into as far as. some veterans using part of their property for commercial use. In here it's defined that if they're using it for commercial it is not exempt we had one in garland county that had a full trailer park on it so that means they do not get an exemption on that property we would. Yep that they would pay taxes on the commercial part of their property. So represented by is that what you're Amendment I know there were some little bit of confusion on the first draft would to dissect I guess you're. First amendment kind of clear that up yes that's that's the purpose of the amendment and we got it engrossed so I hope that that would make it a little bit more clear sometimes it's tricky if the if it's not engrossing you have a look at the amendment then look back at the bill okay thank you a vice chairman Beattie you're recognized. I've been following up kind of on that definition of commercial. Commercial purposes that defined in your bill hi the R. as it again a loose interpretation of the definition of commercial purpose. How do you define that yeah that's language that we got from the assessor's hand they're familiar with what that type of language when they assess a property but is there something specific on what that could could standing timber be considered commercial purpose I'm good Yes Sir thank you represent Beatty it's from the AC the rules assessment coordination division rules and that's language that they can help us help us with and in that incorporates that into this. He said legislation. Ours is just a standard that the assessors use it's it's a standard the sensors use the ACT rules okay. Thank you. Representative brown you're recognized. Thank you Mr chair represented by just to be perfectly clear read the bill so if somebody has three hundred acres and that's all contiguous to the house that's the home state but if they use a hundred and fifty or two hundred acres for commercial purposes that portion of the property is excluded just the property contiguous to the residents that is not being used for commercial purposes that correct that's correct thank you. Thank you representative round representative right one more question if. If what you know she is saying is is right Josh what would would that have any impact at all. What what you said was correct yes Sir yes thank you. Our members any other questions. The representative wouldn't you're recognized On the Commission of the revenue impact is state. The I guess the effort is uncertain whether revenue impact to the county property tax collection would result I'm in favor of the bill but have either one of the county That are sitting at the end of the table have you looked at the impact or what what what are we talking about here I'm in my county it will not impact test at all because we already do it this way most counties are already doing it okay and. In the what in the counties that are not. If you have twenty acres or something at that farm land or. And non commercial property you're paying thirty dollars on that extra land so it's not gonna be a huge impact okay our I was just I was just concerned returning about the the Fridays I'm sorry thank you thank you jim Wooten members any other questions. All right. Thank you. is there anyone in the audience that would like to speak for the bill. Or against the bill. Okay seeing none represented by which I close for your bill I am closed for the bill and I appreciate a good vote right thank you for that members for the wishes of the committee. But do pass from representative warned that second all those in favor signify by saying aye. Opposed graduation you've bills passed thank you Mr chairman committee. I members that's all we have on the agenda for today we Mays do things a little bit different starting next week the as you can see on the agenda it's getting pretty full and a lot of those are bills that have a fiscal impact so we may start putting some of those that were unable to hear this early in session on the deferred list will will eventually build a pull it back up here and we may or may not vote on at that time but I need to be able to clean the agenda so that we know what bills right you're gonna hear and and the folks in the audience as well so they're not showing up just looking at us so I'll follow up with you via text or in person to verify what we're going to do on that are representative they do anything all right members thank you for the work we are turned.