Is the sales tax in Arkansas high?

I feel that it is, because when I moved down to Arkansas from New Hampshire and I purchased an item at the store - I was in what I will call was a form of shock; this feeling was due to the high sales tax in the state. Over the 34 years of my life Ive lived in many states with varying sales tax - but for most of them I was under 18 and lived with my parents and didnt have my own bills, so I really didnt pa y much attention, nor did I care much about sales tax. I was in essence forced to pay attention as I started to notice the effect that sales tax had on my budget when I moved to Arkansas. After all, I had just moved 1480 miles across the country, and that put a serious dent in my funds that was low to begin with. That was more than 8 years ago, but I still feel the damage that sales tax has on my wallet every time I go to the store. As I explained earlier, I moved to Arkansas from New Hampshire, and New Hampshire doesnt have a sales tax, unless you count the 9% meals and rentals tax that the New Hampshire Department of Revenue website (www.revenue.nh.gov) declares is added when you rent a car, get a hotel room/campground site, or eat at a restaurant. Now 9% may seem high, but its very important to remember that the sales tax isnt added to everything you buy as its done in Arkansas. Being that I moved from a state with no real sales tax, I was surprised when I bought an item for $20 and after tax it came up to around $22. Now I do admit that it is somewhat unfortunate that I cant give an accurate sales tax percentage of that time, but that was 8 years ago - and 8 years can have a tendency to wreak havoc on ones memory (or it does on mine at least). I do however know that the current sales tax for Little Rock (which is the city in which I reside) is 9%. Now to be fair, Arkansas (state wise) only has a 6.5% sales tax rate as according to the website for the Arkansas Department of Finance and Administration

(http://www.dfa.arkansas.gov). However; the only way that youd pay 6.5% is if you live in either Monroe or Saline County, which according to the above website for the Department Finance and Administration are the only two counties without a county sales tax. Every other county has a sales tax which varies between .5% in Carroll, Clay, Faulkner, and Izard counties and goes all the way up to 3% in Chicot County. With the exception of the two non-taxed counties, at best you will be paying 7% in sales tax or as much as 9.5% or $09.5 per dollar as far as state and county sales tax goes. However; the county tax is not the end of it - each city and town also has a sales tax. The city sales tax also goes from the range of .5% - 3%. I live in Little Rock which is in Pulaski County, and after looking at the above numbers that Ive obtained from the DFA website, to me its pretty funny that the information makes me feel lucky that I live where I do as opposed to say the town of Dermott in Chicot county. The sales tax rate for Dermott is 2.5% and this along with the county tax makes the rate in Dermott 12% after you add on the 6.5% state tax.
The first job that I got when I moved down here was at Wal-Mart as an overnight stocker, the pay was $7.25 per hour. If my wife who was my fianc at the time wasnt a nurse, it would have been very difficult, if not impossible to live off of that. Today $7.25 is the minimum wage in Arkansas, and friends who still work at Wal-Mart tell me that they make minimum wage. WalMart is not alone in paying minimum wage, theres a lot of people in this state making minimum wage that may not be a lot better off, but would still be closer to making ends meet if the sales tax was not so high. Now today if I was making minimum wage working 40 hours per week, that totals to $290 gross per week less $43.5 (15%) in federal income tax minus 4.5% for Arkansas income tax adding up to $13.05 that leaves me with a net (after tax pay) of $233.45, take out the Social Security and Medicare taxes which according to the website for the United States Social

Security Administration (http://www.ssa.gov/) is 6.2% for social security and 1.45% for Medicare for people making under $113,700 per year, this would leave me with a rounded up $211.27 in pay per week. $211.27 is not a lot of money, especially if you have to live off of that money, as far as monthly bills go. That is $846.06 per month in income for bills. On average, I pay around $150 before sales tax per week for my groceries and toiletries, and thats for me, my wife, and 2 children living in Little Rock. With a 9% sales tax, I pay an extra $13.50 which makes the total bill $163.50. Now if I was earning minimum wage, that food bill would only leave $47.77 per week and without the sales tax, I would have $61.27. $13.50 may not seem like a lot, but in fact it is equal to of the final household funds per week and does make a big difference when it comes to things like gas, clothing, or any other needed item, which in turn would also be taxed. As far as the amount the state makes from sales tax is dependent on the population multiplied by the amount that people spend, and according to the United States Census Bureau website (http://quickfacts.census.gov) Arkansas has 2,949,131 people in it. If all of those people in the state were to purchase $150 in items per week, which would put the yearly income of the state from just income tax at $1,911,036,888. This is a huge amount, but we must remember that sales tax isnt the only way a state makes money. The Arkansas Department Finance and Administration website (www.dfa.arkansas.gov) states that the total spending for fiscal year 2013 was $21,370,555,653, which would mean that sales tax amounts to just under 10% of the states required income. 10% is a lot of money, but as I said before, the state has many other forms of income as well, such as grants from the Federal Government, traffic tickets and court fees, vehicle registration costs, lottery, as well as many other forms of taxes and licensing fees charged to the people of the state. So I believe that sales tax does not have to be so high, if at all it needs to exist. I believe that the state could reduce or even remove sales tax by reducing the amount of redundant services. Arkansas has city police, county sheriff, capitol police, state police, and highway patrol. I dont see a viable reason to have all these law enforcement organizations. I

truly believe that we can reduce sales tax by reducing the services that money is spent on, such as, the budget for the Highway and Transportation Department (which incorporates the highway patrol) according to the DFA website is $1,252,875,511, this sum is less than the amount earned from sales tax. I know that road and bridge is also under that department, but if you cut out the patrol aspect and put those duties onto the state police, it would cut the budget for that department in half - which could lower or even cancel out sales tax. Some people might try and say that the highway patrol deals mainly with big trucks while state police deals with passenger vehicles, well that is simply not true, I have seen both agencies do both jobs. The Director of the State Highway and Transportation Department according to (http://www.dfa.arkansas.gov) earns $165,022.00 per year, and that is just one person in that department. Just think of how much money the state could save if they eliminated the entire law enforcement aspect of that agency. My sons 1st grade teacher according to the website for Arkansas Online (www.arkansasonline.com) earns $41,803 per year, so even if the state doesnt reduce or remove the sales tax, just by eliminating that one position is enough to pay 3 teacher salaries or give a raise to the teachers who are currently employed. Maybe I am just being too cynical or maybe its that I am a spoiled libertarian who got comfortable not paying sales tax, but I still feel that sales tax in Arkansas is high and that it can be lowered or even abolished by getting rid of redundant services such as the highway patrol. If I am required to pay sales tax, or any other tax, it is my belief that I should be the deciding factor on what the tax is used for and not these bureaucrats who make the laws. People like Senators and governors make upwards of $100,000 a year and can afford the sales tax, so they arent effected by it, nor do they care about the people on the lower end of the pay scale. It is harder to notice the effect that 9% has on people who make $211.27 per week when you make more than $1,923 per week (Its kind of like a manager of a company making rules for jobs they have never done). So yes, I feel that the sales tax in Arkansas is high, especially if you are in the lower income bracket.

Works Cited:

www.revenue.nh.gov
http://www.ssa.gov/

Accessed 18-Oct-2013 Accessed 20-Oct-2013

http://www.dfa.arkansas.gov Accessed 18/20-Oct-2013

http://quickfacts.census.gov Accessed 20-Oct-2013 www.arkansasonline.com

Accessed 20-Oct-2013