Nonprofits in Arkansas will no longer benefit from the sales and use tax refund provided by the Nonprofit Incentive Act of 2005. Senate Bill 160, which was signed into law last week, repeals the Act, effective 90 days after the end of the 2017 legislative session.

The Nonprofit Incentive Act was created as an incentive to draw nonprofits to the state. The text of the Act notes, “In situations in which a nonprofit organization is considering whether to locate its operations in Arkansas, it is important to have an inducement to help the nonprofit organization decide to locate to Arkansas.”

However, bill sponsor Sen. David Wallace told the Senate that the incentives had never been used because nonprofits would “rather stay in Washington, D.C.” Wallace was asked by the Arkansas Economic Development Commission to sponsor a bill to eliminate the program. Additional information about the incentive is available in the text of SB 160.

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