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Arkansas Tax and Incentives Update

DFA Hearing Calls Party Foul on Restaurant's Tax-Included Drink Pricing

Posted On: Tuesday, August 08, 2017

While Arkansas Department of Finance and Administration generally tolerates retailers not collecting sales tax as a separately stated amount, sellers need to understand the risk of being required to absorb the tax and pay it out-of-pocket instead of treating the sale as tax-included pricing and backing out the tax from the tax base of gross receipts. Hearing nos. 16-209, 16-210, 16-211 (May 8, 2017) illustrates this risk: A restaurant that also sold mixed drinks claimed a tax-included pricing approach, but this was rejected by the Department, likely effectively increasing the tax imposed by 50%. Read More

AirBnB to Collect Hot Springs A&P Lodging Tax

Posted On: Saturday, May 20, 2017

AirBnB has continued in its trend toward lodging tax collection with an agreement to collect the locally-administered Hot Springs hotel tax administered by the Hot Springs Advertising and Promotion Commission, sometimes called an "A&P tax." (A&P taxes on lodging and restaurants are outliers as the only remaining major locally-administered transaction taxes.) This follows on the heels of the state-level agreement earlier this year for AirBnB to collect DFA-administered state and local sales/use tax and tourism tax, and it is part of a broader trend toward tax collection by AirBnB and other sharing economy platform providers. Centralized tax collection at the platform level should increase tax compliance and make it easier for people to offer lodging through the platform. Read More

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Recent Posts

Arkansas Tax Reform Task Force Takes on Sales, Use and Excise Taxes - November 8, 2017

Taxpayer Strikes Out Again vs. APSC Tax Division - November 2, 2017

Call the Movers: DFA ALJs Will Be Reassigned and Relocated for Increased Independence - October 13, 2017

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