Said in CommitteeBeta

Exactly as spoken.

Revenue & Taxation- House

February 9, 2021 ·2:00 PM or Upon Adjournment Whichever is Later ·Room 151 (Public Comment Holding Room: 149) ·43:06
Video Transcript 1 document

Bills discussed (13)

Bill Title Sponsor Status
SB236 Act 154 · 6 mentions in agenda, transcript, chapter
Matched: “…COMPENSATION BENEFITS AND UNEMPLOYMENT INSURANCE BENEFITS. SB236 J. Dismang TO EXEMPT UNEMPLOYMENT COMPENSATION BENEFITS FRO…”
TO EXEMPT UNEMPLOYMENT COMPENSATION BENEFITS FROM INCOME TAX DURING A CERTAIN TIME PERIOD; AND TO … J. Dismang Notification that SB236 is now Act 154
HB1361 Act 248 · 3 mentions in chapter, agenda, transcript
Matched: “HB1361 Eaves TO PROVIDE FOR THE TAX TREATMENT OF CERTAIN LOANS, PA…”
TO PROVIDE FOR THE TAX TREATMENT OF CERTAIN LOANS, PAYMENTS, AND EXPENSES RELATED TO CORONAVIRUS … Eaves Notification that HB1361 is now Act 248
HB1030 · 2 mentions in agenda, chapter
Matched: “…ECLARE AN EMERGENCY. DEFERRED BILLS Number Sponsor Subtitle HB1030 Jett TO PREVENT UNEXPECTED REDUCTIONS IN REVENUES FROM THE…”
TO PREVENT UNEXPECTED REDUCTIONS IN REVENUES FROM THE WHOLESALE SALES TAXES ON MOTOR FUEL AND … Jett WITHDRAWN BY AUTHOR
HB1034 Act 732 · 2 mentions in chapter, agenda
Matched: “HB1034 Jett TO AMEND THE EXCEPTIONS TO THE PROHIBITION AGAINST THE…”
TO AMEND THE EXCEPTIONS TO THE PROHIBITION AGAINST THE DISCLOSURE OF TAXPAYER INFORMATION; AND TO … Beaty Jr. Notification that HB1034 is now Act 732
HB1035 · 2 mentions in chapter, agenda
Matched: “HB1035 Jett TO ADOPT RECENT CHANGES TO THE INTERNAL REVENUE CODE.”
TO ADOPT RECENT CHANGES TO THE INTERNAL REVENUE CODE. Beaty Jr. Recommended for study in the Interim by Joint …
HB1038 · 2 mentions in agenda, chapter
Matched: “…Jett TO ADOPT RECENT CHANGES TO THE INTERNAL REVENUE CODE. HB1038 Jett TO CLARIFY THAT SALES TAX IS REQUIRED TO BE COLLECTED…”
TO CLARIFY THAT SALES TAX IS REQUIRED TO BE COLLECTED AND REMITTED ON DELIVERY CHARGES … Jett WITHDRAWN BY AUTHOR
HB1043 Act 719 · 2 mentions in agenda, chapter
Matched: “…ON DELIVERY CHARGES FOR SALES BY A MARKETPLACE FACILITATOR. HB1043 Jett TO AUTHORIZE THE WAIVER OF CERTAIN AD VALOREM TAXES ON…”
TO AUTHORIZE THE WAIVER OF CERTAIN AD VALOREM TAXES ON UTILITIES AND CARRIERS; AND TO … McClure Notification that HB1043 is now Act 719
HB1044 · 2 mentions in agenda, chapter
Matched: “…TION OF CERTAIN AD VALOREM TAXES ON UTILITIES AND CARRIERS. HB1044 Jett TO AUTHORIZE THE ESTIMATED ASSESSMENT OF TAX IF A TAXP…”
TO AUTHORIZE THE ESTIMATED ASSESSMENT OF TAX IF A TAXPAYER FAILS OR REFUSES TO PROVIDE … Jett Died in House at Sine Die Adjournment
HB1046 · 2 mentions in chapter, agenda
Matched: “HB1046 Jett TO CLARIFY THE ABILITY OF LEGAL COUNSEL FOR THE SECRET…”
TO CLARIFY THE ABILITY OF LEGAL COUNSEL FOR THE SECRETARY OF THE DEPARTMENT OF FINANCE … Jett WITHDRAWN BY AUTHOR
HB1047 · 2 mentions in agenda, chapter
Matched: “…RATION TO REQUEST REVISION OF A HEARING OFFICER'S DECISION. HB1047 Jett TO CLARIFY THAT A TAXPAYER'S AGENT MAY FILE A PROTEST…”
TO CLARIFY THAT A TAXPAYER'S AGENT MAY FILE A PROTEST ON BEHALF OF A TAXPAYER … Jett WITHDRAWN BY AUTHOR
HB1048 Act 718 · 2 mentions in chapter, agenda
Matched: “HB1048 Jett TO AUTHORIZE THE OFFSET OF A TAX REFUND TOWARD A TAX D…”
TO AUTHORIZE THE OFFSET OF A TAX REFUND TOWARD A TAX DELINQUENCY WHEN A FINAL … Milligan Notification that HB1048 is now Act 718
HB1049 Act 283 · 2 mentions in chapter, agenda
Matched: “HB1049 Jett TO ALLOW THE WITHHOLDING OF STATE INCOME TAX FROM UNEM…”
TO ALLOW THE WITHHOLDING OF STATE INCOME TAX FROM UNEMPLOYMENT COMPENSATION BENEFITS AND UNEMPLOYMENT INSURANCE … Jett Notification that HB1049 is now Act 283
SB238 · 1 mention in transcript
Matched: “…epresentative Jett is going to reintroduce the amendment to Senate bill 238, 236 excuse me. Thank you Mr. Chairman. Representative Jett…”
TO AMEND VARIOUS PROVISIONS OF THE ARKANSAS CODE CONCERNING THE STATE POLICE RETIREMENT SYSTEM. Rapert Sine Die adjournment

Official video page ↗

Transcript

Transcript available Whisper ✓ SliQ live captions: not yet available Download .txt
Machine transcript

May contain errors. Verify important quotations against the official video.

About transcript accuracy
Source
Whisper
Model
ggml-large-v3-turbo.bin RTX5060
Processing date
October 6, 2026
Representative Joe Jett Chair Unverified 0:00
to the hospital today for medical procedures. So Representative Lane Jeans is going to come up and take my place. We're going to run House, or I'm sorry, Senate Bill 236 first. And there's going to be an amendment to be passed out by staff. And the amendments are going to be co-sponsors to be added only. So it shouldn't
▶ Play Suggest a correction Report an error
Speaker 6 0:26
be a major ordeal. Thank you. Paying money. We'll wait till all the amendments get passed out.
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 0:57
All right, members, Representative Jett is going to reintroduce the amendment to Senate bill 238, 236 excuse me. Thank you Mr. Chairman. Representative Jett, you're recognized.
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 1:30
Thank you Mr. Chairman. Members, this is my amendment, my bill. Just adding co-sponsors to the bill. Appreciate
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 1:37
a good vote. Okay. Any questions? Have a motion? Have a motion? All in favor say aye. Aye. Any opposed? Mr. Jett, you're recognized to proceed with Senate bill 236.
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 1:49
Thank you Mr. Chairman. Members, Senate bill 236 is a joint bill with Senator Disman and myself. About two or three weeks ago, DFA came to my office, and they gave us a packet of bills that we normally run through this committee. And one of the bills was talking about adding a mechanism for unemployment benefits. Back in 2017, I think a lot of folks that were here remembers that on the military retirement bill, what we did was we taxed that to pay for the military retirement. But in the process of doing that, we never gave the people that's drawn to unemployment the opportunity to do their withholdings. So Paul Goering and myself, we were talking about that And a short time later, Senator Dismanning stepped in my office And he said, do you understand the ramifications of these folks Not having the mechanism for the last two years To do withholding out of their unemployment checks And in the back of my mind, it was yes But the conversation was, no, I really didn't I didn't take time to fully understand the numbers And the numbers were basically Just doing off my memory was in 2019, the state paid, I think, $97 million in unemployment benefits. In 2020, it was $2.56 billion that flowed back through unemployment benefits to the people. And I think it number was like 236,000 Arkansans. So when you do the quick math, if you do like 1.5 million Arkansans that are taxpayers and you do 236,000, And it was basically around 18% of the taxpayers in the state of Arkansas were drawn to unemployment. And so we knew this was going to be a pretty good size hit. So what this bill does, just the 50,000-foot view is it goes back from 2020, 2021 to let we're not going to tax these people that's on unemployment. And then we have another bill that we're waiting on to do, and we'll take it up at a later date that we're waiting on amendment right now from DFA and Workforce Services to be able to go back and fix that problem about folks not going to take the withholding out of their unemployment taxes. But that's going to be a separate bill from this. So with
▶ Play Suggest a correction Report an error
Gary Cooper Unverified 3:54
that, I'll ask, I'll entertain any questions, Mr.
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 3:58
Chairman. Any questions for Representative Jett? Seeing none, we do have Paul Gehring signed up to speak on this bill. Paul, if you'll go then the table. When you get down
▶ Play Suggest a correction Report an error
Speaker 26 4:27
there, identify yourself. MR. Thank you, Mr. Chair. Paul Gehring, DFA. MR. You're recognized. MR. Thank you, Mr. Chair. DFA has signed up to speak in favor of Senate Bill 236. as Chairman Jett had mentioned, that we had gone from about 44,000 to 45,000 taxpayers in Arkansas that received unemployment benefits in 2018 and 2019 to over 280,000 as a result of the coronavirus pandemic. Of course, the individuals that have received unemployment benefits, they range in incomes from low income to upper income. This pandemic has not spared any type of individual in terms of the amount of income that they're accustomed to receiving. Certainly, the governor has been committed to providing tax relief for working Arkansans, both those that are your traditional wage earners, to self-employed individuals. We have prepared a revenue impact for this bill. This bill, we are anticipating approximately a $51 million revenue impact to the current fiscal year due to the $2.6 billion in unemployment benefits that were received. We did look at the last two years of filing history for the benefit recipients that received a 1099. we saw in the last two years of filing that approximately 65% of those individuals that receive a 1099 actually report the income on their tax return. We use that same percentage to apply to the $2.6 billion that was received in benefits over the 2020 calendar year to come up with the revenue impact, the $51 million revenue impact assumes that of that 65% filed and reported the income on their return, that they also paid the tax due. So of course, it's not quantifiable and not knowable at this point in time how many individuals, if this were to be taxable, would actually report the income on their return and pay the tax due. But we also are fully aware that some individuals did have unemployment claims filed against them that were not legitimate. They were fraudulent claims. We would be happy to answer any questions about the revenue impact, but we are here also to speak in favor of this because it's going to provide some income tax relief to working Arkansans, both employed and received traditional wages from an employer or self-employed individuals. Members, any
▶ Play Suggest a correction Report an error
Speaker 28 6:57
questions for Mr. Gearing? Seeing none, appreciate you coming to the table. Thank you, Mr. Chair.
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 7:07
Do we have anybody in the audience who will speak against this bill for the bill? Mr. Jay, you want to close for your bill? Thank you, Mr. Chairman.
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 7:23
Also, members, you know, there's several folks that got caught up on where their identity got stolen from them and, you know, people are getting 1099s and stuff, so this will help clean that up as well. but that's just on a state level but not on the federal level that's a whole different issue that we can't can't help but we can help on the state level so with that mr. chairman I appreciate a good vote and I make
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 7:46
a motion do pass as amended as amended sir have a motion do pass as amended any discussion all in favor say aye
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 7:54
any opposed right takes represent yet your bills passed thank you members I appreciate it thank you mr. chairman All right, members, we're going to take a look at House Bill 1361. Is that right, Representative Ease? 1361? 1361, members, this is going to be the PPP bill. And there's going to be an amendment on that as well. The staff passed the amendment out. Everybody has an amendment. Remember, it's going to be the same type. This is going to be a co-sponsor amendment. Not a lot to it. Thank you. Is there going to be one amendment or two amendments? There's two amendments. I apologize, members. There's going to be two amendments to this bill. We're going
▶ Play Suggest a correction Report an error
Speaker 35 9:08
to take up, it's both amendments, both amendments, what's the
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 9:16
other amendment? Okay members, first one we're going to take up JLL 141 on amendments, it's going to be JLL 141. Staff, hold up just a second. The sponsor is telling me this has already been engrossed in the bill. Can you make sure it's been engrossed in the bill? Yeah, check on it, please. Members, we want to check and make sure this has been engrossed on the bill since they did send over another amendment here. Just make sure we're all on the same page. it appears it's not been engrossed so I don't know where the miscommunication is but we'll
▶ Play Suggest a correction Report an error
Speaker 46 10:31
take the amendment up right now if it's our review. I believe that it is engrossed, but if you want to go ahead and run that amendment again, we
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 10:50
can do that. Hang on just a second. Let me just get with staff. Okay. Representative, if it's not showing up and being engrossed, just be safe. Let's just go ahead and do
▶ Play Suggest a correction Report an error
Speaker 46 10:59
the amendment again, sir, if you don't care. You want to present your amendment? Sure. This is my amendment. My bill takes out net operating carry forward and corrects some language as it relates to the words tax attributes.
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 11:09
That's it. Members, you heard the amendment. Is there any questions to the sponsor? Jake, are you making a motion? Representative Eves, do you want to make a motion to your amendment? Yeah, I make a motion to adopt the amendment. Members, all in favor say aye. Opposed? Feel free to present your bill. House
▶ Play Suggest a correction Report an error
Speaker 57 11:33
Bill 1361 as amended, sir. Mr. Chairman, I believe there's another amendment. One more minute. Yeah.
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 11:39
You've got to come to the committee better prepared.
▶ Play Suggest a correction Report an error
Speaker 59 11:42
You know that? I don't think this is my
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 11:44
amendment coming this way. This is my amendment. Typically. And it's not really, it don't really mean a lot. It's just adding senators to the bill. So if it gets on there, we're good. If it don't get on there, we're just as good. Members, everybody have an amendment? Representative Nees, would you please present the amendment? Yes, committee members, this bill
▶ Play Suggest a correction Report an error
Speaker 46 12:38
adds nearly every senator as a co-sponsor. That's all the bill does. Any questions, members? You make a motion? I make a motion
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 12:49
to adopt this amendment. All in favor, say aye. Aye. Opposed? Okay. Proceed with the bill as amended now.
▶ Play Suggest a correction Report an error
Speaker 51 12:55
All right. Thank you, Mr. Chairman. Welcome. Committee members, I know we've
▶ Play Suggest a correction Report an error
Speaker 46 12:59
been over this a lot, but I wanted to go through and be real clear on what this does and what the program that it affects was all about. As you remember, in early 2020, because of the pandemic, the federal government offered a lifeline to our small businesses, one that was desperately needed at the time. To incentivize employers to keep employees on payroll during the pandemic, the SBA provided 100% federally backed loans for certain payroll expenses for small businesses, nonprofits, and certain self-employed individuals. These loans would be forgivable if these employers retained employees at a comparable salary level as it was before the crisis. The SBA would forgive these loans, as you might remember, as long as three basic requirements were met. Those would be that loans had to be used exclusively for purposes such as salaries, wages, commission, payment for group health care benefits, payment for family, medical, and sick leave, payment of employee retirement benefits, and payment of state and local taxes imposed on the compensation of these employees. Number two, the loans had to be used to offset no more than eight weeks of eligible payroll expenses. Businesses had to also retain employees at the same or comparable salary levels to before the crisis. These PPP loans nationally totaled $525 billion. Arkansas got $3.3 billion going to businesses again and non-profits. That's around 42,433 PPP loans in Arkansas. This loan forgiveness process that you've heard so much about began in October of 2020 and as of January 2021 approximately only 19 percent of these loans had been forgiven. The CARES Act expressly stated that the forgiven PPP loans would not be considered taxable income and since states generally follow federal treatment of debt discharge they would be expected to incorporate this tax treatment as well but only if they conform to the most recent version of the Internal Revenue Code called the IRC. Many states automatically conform to this code. Arkansas does not conform to IRC. This is why we need to act on this issue. And that issue is of conformity. Our state's current lack of conformity to federal tax code increases compliance costs since businesses and individuals must make adjustments on their state forms that effectively account for what the federal tax code looked like potentially years earlier. And this is much more complicated for businesses than it is for individuals. If we fail to update our tax code to conform to current federal tax code, we'll wind up taxing this federal lifeline that was given from the federal government to our local businesses. And not only does this affect our small businesses, but this bill covers other programs that are listed in your bill. Those are the Economic Injury Disaster Loans, the Emergency Financial Aid Grants for Students, subsidies on existing small business loans treasury program management authority loan forgiveness which is similar to PPP grants for shuttered venue operators and then several other agricultural related programs and it's important to remember though that these loans received through the PPP allowed businesses to keep all of their employees on payroll even as their machines sat idle in factories this was a huge relief to businesses because many were not certain they would be in business a year from that point or not. And yes, some businesses have recovered with many feeling like they've weathered the storm. But now they could be in for a huge surprise this tax filing season if we don't act. And with tax filing season underway, scores of business owners are discovering that painful reality that these PPP loans could still carry a hefty tax bill courtesy of the state of Arkansas. This approach runs counter to the federal government's own treatment of the loans, which were seen as a crucial lifeline for small businesses amid the pandemic. So yes, I'm aware of the argument that there will be some businesses that may benefit more than others by not taxing its income. I contend that is likely more of a question of should they have been granted the PPP loans to begin with, because nearly any business qualified since there were little to no restrictions on being awarded these funds by the federal government. Many businesses that received these funds had no way of knowing if they were going to need them or not, if you think back to around March of last year. So listen, this is one-time money. We can't budget on one-time money. It's not in the forecast. It's not in the current budget. And there is a difference between a revenue impact and a budget impact. Let's leave this money in the hands of our small businesses. Let that money circulate in the economy for years to come. We are seeing unprecedented surplus revenue in our state in spite of the current pandemic. Our small businesses are struggling and they need our help and they need it now. I think it's the right thing to do and I'd be happy
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 17:56
to answer any questions. All right members you heard an explanation of the bill and you got
▶ Play Suggest a correction Report an error
Representative Monte Hodges Unverified 18:03
any questions? Representative Hodges you recognize sir. Thank you Mr. Chair. I mean I've processed my share of PPP loans. As a matter of fact I'm on my second round so when I get back in the office on Friday I'll be processing some more and they put the put the first round on hold, the repayback, until we get through this second round of PPP loans. I appreciate this bill. I've spoken to my bankers, banking friends, and they all really like the bill. Question, is this only relating to PPP loans or those businesses that didn't get PPP loans? Would they have any type of... It would be only directly related to the PP loans that are
▶ Play Suggest a correction Report an error
Speaker 59 18:42
forgiven. Okay. Only the PP loans that are forgiven? Yeah.
▶ Play Suggest a correction Report an error
Speaker 68 18:47
Okay. All right. Thank you. Thank you, Mr. Hodges.
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 18:53
Members, any other questions? Okay, Mayor, we have several folks who want to sign up to speak, I'm assuming, for the bill. Is there a Don Dugan in
▶ Play Suggest a correction Report an error
Speaker 71 19:11
the room? Don, if you don't care, recognize yourself and get to the end of the table, sir. Yes, sir. I'm Don Dugan, current owner of Dugan's Pub, Dizzy's Gypsy Bistro, South on Main, and Stratton's Market. Listen, just as a business owner, I know we, for the four businesses that we have, we received close to $300,000 in PPP loans. and it was four separate loans, two of which were under the $50,000, you know, limit that they've decided that they're just going to forgive federally, and the others were over that limit, but if the federal government isn't going to tax me on this, why would the state of Arkansas, is kind of my question. Aside from that, I mean, he's absolutely right. you know we as business owners are struggling you know we had just kind of at the beginning about this time last year we actually had a little bit of revenue in our accounts right now we don't um but three i mean we push out about between the four businesses about a million dollars in payroll every year and three hundred thousand dollars is dropping the bucket right so So we've been able to retain a majority of our staff. I think out of each quarter we may have lost two employees from what it was in 2019. We've used the money for exactly what it was meant for, which was payroll, payroll taxes, you know, and rent and utilities, and that's it. And we had eight weeks to set that up to spend that. but then they relaxed that regulation which was helpful so i was able to take that same money that we had stored and then spread it out over time a little bit more time so that we could continue to be open we could continue to keep people employed we could continue to keep people off of unemployment and that has been extremely helpful in the fact that our state now has a 440 million dollar surplus in our unemployment coffers and I think that that's fantastic but I'm kind of with him you know it's it's one-time money it's a one-time thing it's not something that we're gonna have every year I mean board let's all hope that we don't have it every year right so but I don't if the federal government's not gonna tax me on it why would the state of Arkansas it just doesn't make a a whole lot of sense to me so any questions for me from anybody anybody any questions
▶ Play Suggest a correction Report an error
Gary Cooper Unverified 21:49
thank you sir appreciate your time yes sir mr gary cooper you in the room you come to the table recognize yourself sir oops thank you sir sorry
▶ Play Suggest a correction Report an error
Speaker 76 22:03
about that i had it i had a suit on in a while it's a little snug and i can't move around in it very
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 22:09
well well you're all right you're sitting down there Well, my name is Gary Cooper.
▶ Play Suggest a correction Report an error
Speaker 77 22:14
I'm a CPA in town with Hogan Taylor. I'm the tax, our office managing partner, and I have 100 people, other CPAs and consultants in our office. And so we kind of saw this thing firsthand back in March and April when we quit doing tax returns and just answered the phone, kind of helped our Arkansas businesses through this, right? Just a whole lot of uncertainty. Continues to be a whole lot of uncertainty. And really, I can't say it any better than Don Dugan, you know, just said it as an Arkansas business. But, you know, I think the way you kind of have to think about this is there's obviously a revenue impact to the state for not taxing it. But really, it's kind of a reinvestment into these businesses. You know, I can tell you that every dollar counts. It still counts right now. Okay. So this deal's not over. They need this money to reinvest, to keep people on payroll. I can tell you for the vast majority of clients that I have and that we've talked about, especially in our office, it worked the way it was supposed to work. People were retained on payroll. They were able to come to work. They continue to have a job. So I would personally like to see this bill passed so that we can keep that money in their hands, let them reinvest it back into their business, and hopefully when we come out of this, that reinvestment back into the business will ultimately pay dividends to the state of Arkansas and future taxable income. But, sir, that's all I had today. If there's any questions, I'd be happy to
▶ Play Suggest a correction Report an error
Gary Cooper Unverified 23:56
do my best to answer them. Thank you, Gary. Any members, any
▶ Play Suggest a correction Report an error
Representative Les Warren Unverified 24:03
questions? Mr. Warren, you recognize, sir? Thank you. Do you mind just addressing the problems you will have with just filing of taxes based
▶ Play Suggest a correction Report an error
Speaker 81 24:14
on timing if this were taxed? Yes,
▶ Play Suggest a correction Report an error
Speaker 76 24:17
sir. That's a great question. One is I fully realize nobody feels sorry for the CPAs when they're doing tax returns.
▶ Play Suggest a correction Report an error
Speaker 77 24:24
But it does create a problem. them. I would tell you our clients fall into one of a couple of categories. One, the bigger businesses have the opportunity to have people on staff, somebody with some sophistication that kind of follows these things. But when it was announced that the federal government was going to make these loans tax-free, they automatically assumed that Arkansas was going to do the same thing. And as much as we tell them it's not, sometimes it doesn't sink in. They may not read an email. They may not, you know, follow it that closely. But it does create a difference in federal income and state taxable income, right? So it will delay our ability to file taxes for businesses if it's not passed, and then it will obviously create a significant difference. Thank you, sir. Any other questions? President
▶ Play Suggest a correction Report an error
Gary Cooper Unverified 25:24
Lundgren, do you have a question now?
▶ Play Suggest a correction Report an error
Representative Robin Lundstrum Unverified 25:32
This weekend, Sunday afternoon, two different accountants called me, and you're right, there's not a lot of sympathy out there for them, but I did have sympathy Sunday afternoon. They talked about the backup and having completed forms, and their frustration was with us that we weren't getting our job done so that they could do their job and the frustration of having to file amended reports. And they were very happy we were doing this, but they were also very frustrated. This needs to get done. This needs to get done. So I said, when it comes time to speak, I will speak on your behalf. One of them is 72 years old, and he used some very specific language I obviously can't use here. But it's extremely colorful, and I'm sure he's listening today. But he would say to us, get your stuff together and get it out of there. so we can get our job done, so we can get businesses back to
▶ Play Suggest a correction Report an error
Speaker 76 26:22
work. Well, that's a great point. I would agree with that. You know, the quicker the
▶ Play Suggest a correction Report an error
Speaker 77 26:26
better. I mean, it'll be all hands on deck to get all this stuff done and filed, you know, assuming this thing, you know, passes. But that's right. I mean, people are just, the uncertainty in any business, you know, drives fear, and then you're not able to make sound business decisions. So while we have the ability to pass this and let our Arkansas businesses move on with whatever it is they do, then the sooner the better. Thank you, ma'am. Any other
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 27:00
questions, members? Thank you, sir. Appreciate your testimony. Matt, you want to talk? Matt, if you don't care, recognize yourself and
▶ Play Suggest a correction Report an error
Speaker 85 27:14
proceed. Get ready. Matthew Bach, outside tax counsel for the State Chamber. Thank you, Mr. Chair. I think Representative Eaves and the other speakers have put it all out there already
▶ Play Suggest a correction Report an error
Speaker 88 27:26
and said it better than I could myself. State Chamber is also supportive of this. The State of Arkansas has already got $1.25 billion of CARES Act support. The PPP funding is intended for helping small businesses, and that's really where it should stay. we'd urge support as well on this. Thank you, Matt. Any questions,
▶ Play Suggest a correction Report an error
Gary Cooper Unverified 27:46
members? Thank you, Matt. Anybody in audience want to speak against the bill, for the bill? Representative Nees, you want to close
▶ Play Suggest a correction Report an error
Speaker 45 27:59
for your bill, sir? Yes, members. We've been over it a bunch, and you've all kind of heard the details of it. I did want to say that this was not a, well, that this was a collaborative effort, and I rarely compliment Chairman Jett, and I hate to do it now, but Chairman Jett, along with Representative Mayberry and I. Don't strain yourself. It's pretty tough to get that part out, but Representative Mayberry, who's unable to be here today, has worked hard on the PPP bill as well, so I appreciate her and Representative Jett. So with that, I would make a motion do pass. Members, you have a motion do pass. Any debate as amended? Yeah, motion do pass as amended. Any debate, members? All
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 28:31
in favor, say aye. Aye. Opposed? Congratulations, sir. You passed your bill. Thank you. Thank you, committee members. All right, members. I think that's it. We had another bill that was going to do, but the amendment did not get over here in time, so I guess we'll take that up next Tuesday. But you guys have a pencil. Write this down. I'll tell you kind of what's up coming next Tuesday. Don, I appreciate your testimony. I appreciate you guys coming down. Next Tuesday or Thursday? What's today? Today's Tuesday. Next Thursday. Next Thursday. This Thursday? Yeah, it's coming Thursday. This coming
▶ Play Suggest a correction Report an error
Gary Cooper Unverified 29:14
Thursday. We're not? No, we're meeting Thursday. We're meeting this coming Thursday. Don't confuse me.
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 29:20
Well, I thought today was Thursday. I didn't know it was Tuesday. Somebody needs to tell me this stuff. Okay, we're not gaveling out. Hey, everybody, nobody leave. We might get the amendment here in a second. If we do, we'll... Well, if I do it, they're going to turn the video off on us. Hey, members? Hey, members? Yeah,
▶ Play Suggest a correction Report an error
Speaker 95 29:46
but we're going to turn the video off on
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 29:50
us if we get this other deal. Hey, members? I've been told by staff that they're bringing another amendment over, and if they do that, we're going to knock out House Bill 1049 real quick. So we're going to give them just a moment here to see if they can pull this off. But here's what we're going to do this coming Thursday. Okay. We're going to take a look at House Bill 1377, House Bill 1360. Representative Hawks, you want to run your bill Thursday, sir? Okay. House Bill 1383, House Bill 1345, and then if DFA gets the fiscal impact back where it suits us, We're going to take a look at Representative Mark Lowry's bill, 10-11, and Representative Andrew Collins' bill, 13-74. So we're going to have a full day of work this coming Thursday, but I don't think anything's going to be controversial here. I think we've already heard Mark Lowry's bill, so I think everything else, best I can tell, is non-controversial and not a fiscal impact. We're just going to take about a five-minute recess here to make sure that we can get this amendment over. If we can, we're going to knock this out. I'd really like to have this bill tied back to this Senate Bill 236 if we can. So if y'all don't care, just sit tight for about five minutes and then we'll come back and see if we can do this. So without objection, we're in recess for five minutes.
▶ Play Suggest a correction Report an error
Unknown speaker 31:33
Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. Thank you. All right, members. we get everybody's attention
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 37:33
you know what i found out representative jet what's that sir i get about as much respect as you do you deserve as much respect as i get that's that's pretty bad anyway everybody have a copy of the amendment. Representative Jett is going to present the amendment to House Bill 1049. Representative Jett, you're recognized. Identify yourself, please. Representative Joe Jett. I'm
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 38:05
going to have Mr. Paul Gehring, DFA, come explain the amendment,
▶ Play Suggest a correction Report an error
Speaker 26 38:17
please. Mr. Gehring, if you'll identify yourself. Paul Gehring, DFA, Assistant Revenue Commissioner. You're recognized. Thank you, Mr. Chair. We also have right behind me is Keith Linder. He's one of our attorneys with DFA as well, and he had worked in conjunction with the Department of Workforce Services on the language of the amendment to make sure that legally everything that we had in the bill was going to be complying with the laws, both state and federal, that govern DWS. So with the Chair's permission, I'd like Mr. Linder to speak about the language
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 38:46
of the amendment. Mr. Linder, if you'd come forward and
▶ Play Suggest a correction Report an error
Speaker 100 38:55
identify yourself. Thank you. Keith Linder with the Arkansas Department
▶ Play Suggest a correction Report an error
Speaker 101 39:02
of Finance and Administration. You're recognized. The bill is originally filed, only dealt with Title 26, the title having to do with taxation, and it created a voluntary withholding from unemployment compensation benefits under the Arkansas Income Tax Withholding Act. In our discussion with the Department of Workforce Services, we decided it was necessary to venture into Title 11 a little bit to make this work, both at the state and federal level. So Section 1110.803 has to do with when money can be withdrawn from the unemployment trust fund. we have an exception in that section to allow the withdrawal of money for federal income tax withholding where a taxpayer likes to have that done so what we've done in section 803 is copy really the the federal language to where we have an estate exception to where money can be withdrawn from the trust fund if a person elects to have that done you'll notice the last line and the new Section 1 refers to a program approved by the United States Secretary of Labor. So the Secretary of Labor does have to come in and approve our withholding program because these are federal funds. That has been submitted. We have not heard back yet, so we are going to have to wait to hear back from the Department of Labor before any program could be actually implemented. But we can still have a vote here today on that. And then the new section 2 in the amendment, 2651-905, is largely the same as the bill was originally filed. The difference will be in subsection C-3. That allows somebody to change their withholding status once they've made an election. That is required under federal law. You have to let somebody change their status at least once per calendar year. There is no limit placed right now as the language is written. And then the new Section 3 is temporary language that allows time for us to receive Department of Labor approval when the law goes into effect, as well as time for the Division of Workforce Services to make any necessary computer upgrades they have to make in order to implement the withholding system. I'd be glad to take any questions you have at
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 41:33
this time. Members, do we have any questions? Seeing none, would anybody like to speak against the amendment? Anybody else for the amendment? Representative Jett, you want to close on the amendment? I'm close, sir. All right. We have a motion to adopt the amendment. We have a motion. Any discussion? All in favor say aye. Aye. Any opposed? Mr. Jett you're to proceed with your bill
▶ Play Suggest a correction Report an error
Representative Joe Jett Chair Unverified 41:58
Thank you thank you Mr. Chairman Members I think everybody kind of knows what we're doing here this is what it's going to do is give the folks back home citizens of Arkansas who's been on employment to benefit to be able to withhold either unemployment checks and that's a long and short story I think we've kind of beat this horse to death so with that Mr. Chairman I'm closed for my bill we have any questions anybody to
▶ Play Suggest a correction Report an error
Speaker 17 42:22
speak against the bill for the bill we have a motion to adopt
▶ Play Suggest a correction Report an error
Representative Lane Jean Unverified 42:31
House Bill 10-4 McElroy did you want us I will make a motion y'all can't see me now McElroy made the motion all right all in favor say aye any opposed Congratulations, Rep. Jett, you've passed your bill. Thank you, members. Members, we are going to meet. This is Tuesday. We're going to meet Thursday after we get out of session. I want to clarify that for the chairman. Thank you. Anyway, we are adjourned. Thank you.
▶ Play Suggest a correction Report an error

Agenda

REGULAR AGENDA Number Sponsor Subtitle

HB1361 Eaves TO PROVIDE FOR THE TAX TREATMENT OF CERTAIN LOANS, PAYMENTS, AND EXPENSES RELATED TO CORONAVIRUS 2019 (COVID-19) RELIEF PROGRAMS; AND TO DECLARE AN EMERGENCY.

8:41

HB1049 Jett TO ALLOW THE WITHHOLDING OF STATE INCOME TAX FROM UNEMPLOYMENT COMPENSATION BENEFITS AND UNEMPLOYMENT INSURANCE BENEFITS.

38:09

SB236 J. Dismang TO EXEMPT UNEMPLOYMENT COMPENSATION BENEFITS FROM INCOME TAX DURING A CERTAIN TIME PERIOD; AND TO DECLARE AN EMERGENCY.

0:23

HB1030 Jett TO PREVENT UNEXPECTED REDUCTIONS IN REVENUES FROM THE WHOLESALE SALES TAXES ON MOTOR FUEL AND DISTILLATE SPECIAL FUEL BY AMENDING THE LAW CONCERNING THE CALCULATION OF THE WHOLESALE SALES TAXES.

HB1034 Jett TO AMEND THE EXCEPTIONS TO THE PROHIBITION AGAINST THE DISCLOSURE OF TAXPAYER INFORMATION; AND TO DESIGNATE THE SECRETARY OF THE DEPARTMENT OF FINANCE AND ADMINISTRATION AS THE OFFICIAL CUSTODIAN OF CERTAIN RECORDS.

HB1035 Jett TO ADOPT RECENT CHANGES TO THE INTERNAL REVENUE CODE.

HB1038 Jett TO CLARIFY THAT SALES TAX IS REQUIRED TO BE COLLECTED AND REMITTED ON DELIVERY CHARGES FOR SALES BY A MARKETPLACE FACILITATOR.

HB1043 Jett TO AUTHORIZE THE WAIVER OF CERTAIN AD VALOREM TAXES ON UTILITIES AND CARRIERS; AND TO CREATE A STATUTE OF LIMITATIONS ON THE COLLECTION OF CERTAIN AD VALOREM TAXES ON UTILITIES AND CARRIERS.

HB1044 Jett TO AUTHORIZE THE ESTIMATED ASSESSMENT OF TAX IF A TAXPAYER FAILS OR REFUSES TO PROVIDE RECORDS.

HB1046 Jett TO CLARIFY THE ABILITY OF LEGAL COUNSEL FOR THE SECRETARY OF THE DEPARTMENT OF FINANCE AND ADMINISTRATION TO REQUEST REVISION OF A HEARING OFFICER'S DECISION.

HB1047 Jett TO CLARIFY THAT A TAXPAYER'S AGENT MAY FILE A PROTEST ON BEHALF OF A TAXPAYER IF THE TAXPAYER PRODUCES A PROPERLY EXECUTED POWER

HB1048 Jett TO AUTHORIZE THE OFFSET OF A TAX REFUND TOWARD A TAX DELINQUENCY WHEN A FINAL ASSESSMENT OF TAX HAS BEEN ISSUED.

Page 2 of 2

Speakers

Representative Joe Jett Chair Unverified
42 segments
Speaker 6
1 segment
Representative Lane Jean Unverified
15 segments
Gary Cooper Unverified
6 segments
Speaker 26
8 segments
Speaker 28
1 segment
Speaker 35
1 segment
Speaker 46
13 segments
Speaker 57
1 segment
Speaker 59
2 segments
Speaker 51
1 segment
Representative Monte Hodges Unverified
3 segments
Speaker 68
1 segment
Speaker 71
6 segments
Speaker 76
3 segments
Speaker 77
8 segments
Representative Les Warren Unverified
1 segment
Speaker 81
1 segment
Representative Robin Lundstrum Unverified
2 segments
Speaker 85
1 segment
Speaker 88
2 segments
Speaker 45
2 segments
Speaker 95
1 segment
Speaker 100
1 segment
Speaker 101
6 segments
Speaker 17
1 segment