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Arkansas Tax and Incentives Update

Light Manufacturers Beware: DFA Only Allowing Exemption for "Industrial" Manufacturing

Posted On: Sunday, November 20, 2016

In a troubling recent administrative decision, docket nos. 17-041 and 17-170 (Nov. 1, 2016), the Department of Finance and Administration appears to have added an extrastatutory "industrial" requirement to the application of the manufacturing machinery and equipment exemption. Businesses engaged in nontraditional manufacturing need to evaluate their risks in claiming the manufacturing exemption. Read More

Big Thaw: DFA Reverses Opinion and Treats Freezer as Manufacturing

Posted On: Thursday, April 28, 2016

The Department of Finance and Administration (DFA) recently published a letter opinion, no. 20151008-S (Apr. 4, 2016), allowing a poultry blast freezer to obtain the reduced rate of sales tax on electricity used in manufacturing. This letter opinion was a reversal of a previously issued opinion, no. 20151008 (Feb. 9, 2016), which had wrongly denied the low rate on the basis that blast freezing was not actual manufacturing. (See our prior post criticizing the opinion.) This about-face demonstrates a benefit of tax transparency: The taxpayer community can identify erroneous legal interpretations and get them corrected. Read More

Ice Cold: DFA Tells Manufacturer That It Is Not Engaged in "Actual Manufacturing"

Posted On: Monday, February 29, 2016

The Arkansas Department of Finance and Administration has published a ruling that narrowly interpreted eligibility for the reduced rate of tax on sales of electricity for use by a manufacturer in the actual manufacturing process.  Opinion no. 20151008 (Feb. 9, 2016).   Read More


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