Arkansas Advocates for Children and Families: Benefits of HB 1585 go mostly to wealthy

According to an analysis by the Institute on Taxation and Economic Policy (ITEP), House Bill 1585 would target personal income tax relief to Arkansas taxpayers who make over $155,000 per year (the top five percent of earners). This group would receive one-half (50 percent) of the total benefits resulting from the tax cut. That’s compared to those who make $29,000 or less per year, who would get nothing.

The richest one percent of Arkansans, those with total incomes of $346,000 or more, would see an average tax cut of $1,275 and would receive over one-fourth (26 percent) of the total benefits of the proposed cut. The next highest four percent, those with incomes between $155,000 and $346,000, would see an average tax cut of $301 and would receive 24 percent of the total benefits.

The bill doesn’t offer many benefits to middle-income Arkansas families. The middle 20 percent of Arkansas taxpayers (those making between $29,900, and $49,000 a year) would see an average tax cut of only $7 – just three percent of the total benefits from the tax cut. The bottom 40 percent of Arkansas taxpayers, those who make less than $29,000, would see no tax cut (on average) and their share of the bill’s benefits would be zero.

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