Arkansas Sales Tax and Use Tax
What is the Arkansas sales tax?
Taxes in Arkansas are destination-based, meaning the Arkansas sales tax rate is based, or determined from, the destination location an item is shipped to. This complicates business for retailers who need to have the exact and up-to-date sales tax rate for every shipment they make.
To see a full breakout of Arkansas sales tax rates by state, county, city and special district, use our easy Arkansas sales tax calculator. After putting in any ZIP code, you can enter a retail price to calculate Arkansas sales tax totals.
What is the Arkansas use tax?
The Arkansas state use tax rate is the same as the state, county, city and special district rates.
If you reside in AR, use tax is due to the state on any and all transactions where sales tax has not been paid, even out-of-state internet sales.
Who has to pay Arkansas sales tax or use tax?
In general, a business must collect and remit all applicable Arkansas sales taxes if that business has nexus, a physical presence such as a brick-and-mortar location, within a given state. The presence of an employee or salesperson, delivery by the seller's vehicle, and storage of materials usually establishes nexus as well.
Arkansas says that an out-of-state seller is required to collect tax if they can be defined as a "retailer engaging in business". Arkansas has certain additional laws establishing nexus for other reasons such as out-of-state businesses using in-state affiliates, advertisers or vendors, or businesses that make internet sales or mail catalogs.
If you are not sure if you have established nexus in Arkansas, you can usually get free help by contacting the Arkansas Department of Finanace and Administration. Click here for an updated listing of direct phone numbers. You could also contact a qualified certified public accountant or lawyer who specializes in tax law in Arkansas. Click here for listing of recommended resources.
Special rules applying to Arkansas sales tax and use taxes
- Shipping is taxable.
- Finance charges are not covered by a specific provision.
- Clothing is taxed at the same rate as the general sales tax.
- Arkansas Sales tax holidays are held for some back to school items .
Since Arkansas legislators can vote to change the Arkansas sales tax and use tax rates at any time, it is very difficult for individuals to keep track of the changes. The population of AR state is also rapidly changing, which can cause frequent updates to the ZIP codes and local municipality names and complicates the job of keeping track of Arkansas sales tax jurisdictions.