2024 Guide to State Sales Tax in Arkansas

As an e-commerce seller, you will need to collect sales tax in Arkansas if you:

• Have sales that exceed $100,000 or 200 transactions during the current or preceding year (economic nexus), or
• Have physical presence in Arkansas (physical nexus).

Below, we will highlight some of the basic provisions of Arkansas sales tax law.

What is the tax rate range for Arkansas?

State: Arkansas’s general sales tax rate is 6.5%. Reduced rates apply to certain types of property, (i.e., food, electricity, etc.).

Sales Tax Rates.

Local: Arkansas localities impose their own sales tax at rates ranging from 0% to 5.0%.

List of Cities and Counties with Local Sales and Use Tax.

Do you have physical or economic nexus in Arkansas?

Physical nexus

Businesses are considered to be engaged in an established business in Arkansas under certain conditions. If you are engaged in an established business in Arkansas, you are required to collect and remit sales tax on all taxable sales that are shipped to Arkansas.

Examples of business activities that can create physical nexus in Arkansas:

• Has a store, showroom, distribution center in the state,
• Own or lease physical property in the state,
• Have inventory in the state, or
• Have employees present in the state.

Arkansas Rules.

Economic nexus

All remote sellers and marketplace facilitators that exceed $100,000 or 200 transactions in sales into Arkansas in the current or previous year are required to collect and remit Arkansas sales and use tax.

Additional details:

• Sales include sales of tangible personal property, taxable services, digital codes, or specified digital products.
• Sales made through a marketplace facilitator are not included when calculating sales and transaction thresholds
• Remote sellers and marketplace facilitators are required to register for a permit on the next transaction after exceeding either the sales or number of transactions threshold

Remote Sellers.

What are examples of sales of taxable items?

• Tangible personal property, unless specifically exempted
• Food, not including candy and soft drinks (reduced state tax rate of 1.5%)
• Clothing
• Digital goods

What are examples of sales of nontaxable/exempt items?

• Prescription drugs
• Certain agricultural items
• Software as a service (SaaS)

Are there any sales tax holidays?

Currently, Arkansas has one recognized sales tax holiday. The holiday begins at 12:01 am on the first Saturday in August and concludes at 11:59pm the following Sunday.

Items that can be purchased tax free include certain electronic devices, school supplies, school art supplies, school instructional materials, and clothing.

2022 Sale Tax Holiday.

Is Arkansas a member of the SST (Streamlined Sales Tax)?

Yes, Arkansas is a full member of the Streamlined Sales Tax Governing Board (SSTGB).

How to get a sales tax permit / links to register in this state?

You can register online at:

• Streamlined Sales Tax Registration System
• Arkansas Taxpayer Access Point

Rates

• State Sales Tax Rates – Arkansas Department of Finance and Administration
• Sales and Use Tax Section Local Tax Lookup Tools – Arkansas Department of Finance and Administration