Total Range for 2025
| Base state sales tax rate | 6.50% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Local rate range | 0%-5% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Total rate range | 6.5%-11.5% | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Economic sales nexus threshold | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | |
| Transactions threshold | N/A | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
| Sales tax return filing due date | 20th of following month | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate | Base state sales tax rate |
The base state sales tax rate in Arkansas is 6.5%, but since the local rates range from 0-5% the total sales tax range is 6.5-11.5%.
How to calculate your sales tax rate
Use our online sales tax calculator to determine the combined state and local sales tax rate for each location where you have a physical or economic nexus. Just enter your state and ZIP code to get your sales tax rate.
Example of using the sales tax rate in a tax calculation:
You run a clothing store in Little Rock, Arkansas. A customer purchases a jacket for $50. Little Rock has a local sales tax rate of 2% on top of the state’s 6.5% rate. Here’s the calculation:
- Local tax amount = $50 (item price) * 2% (local rate) = $1
- Total sales tax = $1 (local tax) + 6.5% (state rate) * $50 (item price) = $3.75
- Final price = $50 (item price) + $3.75 (sales tax) = $53.75
Nexus: Why do you need to collect sales tax in Arkansas?
If you’re selling goods and services in Arkansas then sales tax might apply! To determine your obligation, you need to understand “nexus,” which ties businesses to states for tax purposes.
Two types of nexus exist:
- Physical Nexus: Having a physical presence, like an office, warehouse, or employees in Arkansas, triggers this type. If you do, you likely need to collect sales tax.
- Economic Nexus: This kicks in when your sales within Arkansas exceed a certain economic threshold. Even without a physical presence, surpassing this threshold requires collecting sales tax.
In Arkansas, there is also a transaction threshold of 200, which means that even if your sales aren’t over $100,000 if you’ve sold more than 200 items then you still need to pay sales tax.
Services
Generally, services in Arkansas are not taxable. There are some exceptions, though:
- Services directly linked to the sale of taxable goods (e.g., installation fees for carpeting, software installation).
- Repair or maintenance services for taxable personal property (e.g., car repairs, appliance maintenance).
Goods
Most tangible personal property sold in Arkansas is taxable. This covers most physical items you can buy or sell.
There are some exemptions, including:
- Food and food ingredients are subject to a minimal sales tax of 0.125%
- Prescription drugs and certain medical equipment.
- Certain farm equipment and processing supplies used directly in agricultural production.
- Educational materials like textbooks and school supplies.
Freight/Shipping
- The cost of shipping itself is usually not taxable in Arkansas. However, it can be factored into the taxable value of the shipped goods. This means the sales tax is calculated on the total price, including both the cost of the goods and the shipping charges.
Clothing
- All clothing sales are taxable in Arkansas
Electronics
- In Arkansas, electronics are subject to sales tax
SaaS
- Software as a Service (SaaS): Generally considered a non-taxable service in Arkansas
Digital Products
- In general, digital products are considered taxable
Software
- Downloaded software: Generally considered taxable tangible personal property.
- Pre-installed software on a device: Likely part of the device’s sale and typically not taxable separately (unless separately priced).
How to register for sales tax in Arkansas
Arkansas uses a seller’s permit, also known as a Revenue Receipt Tax (RRT) license, for businesses selling taxable goods or services. You can register for this license online or by mail.
Online Registration (Recommended):
This is the quickest and most convenient method:
- Visit the Arkansas Taxpayer Access Point (ATAP) website: https://atap.arkansas.gov/
- Click on “Sign up” and follow the prompts to create an account.
- Once your account is created, navigate to the section for registering for a new RRT license.
- Provide the required information.
Mail-in Registration:
If online registration isn’t feasible, you can use the mail-in method:
- Download the Revenue Receipt Tax Application (Form ET-1) from the Arkansas Department of Finance and Administration (DFA) website: https://www.dfa.arkansas.gov/ (search for “Revenue Receipt Tax Application” or Form ET-1)
- Complete the application form carefully and accurately.
- Mail the completed form with any required documentation (mentioned on the form) to the address provided by the DFA.
Additional Information:
- Once you register, you might need to apply for an RRT license account number for each physical location where you conduct taxable sales.
- The Arkansas DFA will typically process your application and mail your RRT license within a few weeks.
How to collect sales tax in Arkansas
In Arkansas, collecting sales tax comes down to this:
- Know what’s taxable: Check the DFA website for details (mentioned earlier).
- Charge the right rate: The base rate is 6.5%, but local rates might apply (check with your local finance department).
- Collect from customers: Use your point-of-sale system or add it manually.
- Keep good records: Track sales, tax collected, and exemptions.
- File & Pay: Submit returns (monthly, quarterly, or annually) and collected tax to the DFA (online or by mail).
How to get a sales tax permit/license in Arkansas?
To obtain a sales tax permit in Arkansas, start by registering your business online through the Arkansas Department of Finance and Administration’s Online Taxpayer Access Point (TAP). You’ll need to provide essential business information, including your business name, address, Federal Employer Identification Number (FEIN) or Social Security Number (SSN), and details about the business owners.
Complete the application for a Sales Tax Permit, which allows you to collect and remit sales tax on taxable sales in Arkansas. There is no fee for applying, and once your application is processed, you will receive your permit.
When are Arkansas’s sales tax returns due?
Arkansas sales tax returns are due by the 20th of the month following the reporting period. This applies regardless of whether you file monthly, quarterly, or annually.
Here’s a breakdown for clarity:
- Monthly Filers: If your business makes a significant amount of taxable sales, you’ll likely be classified as a monthly filer. Your return and tax payment would be due on the 20th of the month following each calendar month.
- Quarterly Filers: Businesses with a moderate amount of taxable sales might be categorized as quarterly filers. Your returns and tax payments would then be due on the 20th of the month following the end of each quarter (March 20th, June 20th, September 20th, and December 20th).
- Annual Filers: Businesses with a very low volume of taxable sales may qualify for annual filing. Your return and tax payment would be due on January 20th of the following year.
Is anyone exempt from sales tax in Arkansas?
In Arkansas, sales tax exemptions are applied in a few different ways:
- Exempt Entities: Certain entities are entirely exempt from paying sales tax on all purchases. This includes:
- State and local governments
- Public schools and some non-profit organizations (must qualify for exemption)
- Certain religious organizations
- Exempt Items: Specific items are exempt from sales tax regardless of who purchases them. Examples include:
- Prescription drugs and medical equipment
- Educational materials (textbooks, etc.)
- Farm equipment for agricultural use
- SaaS
- Exempt Use: Sometimes, the intended use of an item determines if it’s exempt. For instance, manufacturing equipment used in production might be exempt, while the same equipment purchased for personal use would be taxable.
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