Greater Opportunity Through Innovative Change


Arkansas has one of the worst tax structures in the South. The state income tax rate is the region's second highest, it's corporate tax rate is third highest and capital formation is impeded by a state capital gains tax.

There is a clear lack of leadership in Little Rock on tax policy issues. More than $80 million in tax and fee increases were enacted in the 2001 legislative session. Yet not one tax cut was signed into law. Arkansas politicians and revenue agents frequently argue the state has "low taxes" because property taxes are among the U.S.'s lowest on a per capita basis. There are two fallacies in their reasoning. First, a state's overall tax structure is more important than only one tax.  Second, four of the six states bordering Arkansas have similar property tax ratings on a per capita basis.

Contrast the lack of leadership in Little Rock with Washington where President George W. Bush has delivered on his promise of cutting taxes by working with Republicans, Democrats and Independents. Bush is a leader who has delivered an income tax cut, revision of the marriage tax penalty and repeal of the death tax. With evidence mounting that the U.S. economy is headed into recession Bush has acted decisively.