Arkansas Economy

The state's gross domestic product for 2005 was $87 billon. Its per capita personal median income (in current dollars) for 2006 was $35,295, according to the U.S. Census Bureau [9]. The state's agriculture outputs are poultry and eggs, soybeans, sorghum, cattle, cotton, rice, hogs, and milk. Its industrial outputs are food processing, electric equipment, fabricated metal products, machinery, paper products, bromine, and vanadium.

In recent years, automobile parts manufacturers have opened factories in eastern Arkansas to support auto plants in other states. Additionally, the city of Conway is the site of a school bus factory.

Tourism is also very important to the Arkansas economy; the official state nickname "The Natural State" was originally created (as "Arkansas Is A Natural") for state tourism advertising in the 1970s, and is still regularly used to this day.

According to Forbes.com or http://www.forbes.com/2007/07/10/washington-virginia-utah-biz-cz_kb_0711bizstates-table.html

Arkansas currently ranks 21st for The Best States for Business, 9th for Business Cost, 40th for Labor, 22nd for Regulatory Environment, 17th for Economic Climate, 9th for Growth Prospects, 34th in Gross Domestic Product, and positive economic change of 3.8% or ranked 22nd.

Arkansas imposes a state income tax with six brackets, ranging from 1.0% to 7.0%. The first $9,000 of military pay of enlisted personnel is exempt from Arkansas tax; officers do not have to pay state income tax on the first $6,000 of their military pay. Retirees pay no tax on Social Security, or on the first $6,000 in gain on their pensions (in addition to recovery of cost basis). Residents of Texarkana, Arkansas are exempt from Arkansas income tax; wages and business income earned there by residents of Texarkana, Texas are also exempt. Arkansas's gross receipts (sales) tax and compensating (use) tax rate is currently 6%. The state has also mandated that various services be subject to sales tax collection. They include wrecker and towing services; dry cleaning and laundry; body piercing, tattooing and electrolysis; pest control; security and alarm monitoring; self-storage facilities; boat storage and docking; and pet grooming and kennel services.

In addition to the state sales tax, there are more than 300 local taxes in Arkansas. Cities and counties have the authority to enact additional local sales and use taxes if they are passed by the voters in their area. These local taxes have a ceiling or cap; they cannot exceed $25 for each 1% of tax assessed. These additional taxes are collected by the state, which distributes the money back to the local jurisdictions monthly. Low-income taxpayers with a total annual household income of less than $12,000 are permitted a sales tax exemption for electricity usage.

Sales of alcoholic beverages account for added taxes. A 10% supplemental mixed drink tax is imposed on the sale of alcoholic beverages (excluding beer) at restaurants. A 4% tax is due on the sale of all mixed drinks (except beer and wine) sold for "on-premises" consumption. And a 3% tax is due on beer sold for off-premises consumption.

Property taxes are assessed on real and personal property; only 20% of the value is used as the tax base.

The quarter for Arkansas from the 50 State Quarters program. Released October 20, 2003.

Little Rock city center.

A map of Arkansas with county boundaries drawn