Tax Back (Sales and Use Tax Refund)

The Tax Back program provides sales and use tax refunds on the purchase of building materials and taxable machinery and equipment to qualified businesses investing the minimum required based on the tier in which the company locates and who either a) sign a job creation agreement under the Advantage Arkansas or Create Rebate programs within 24 months of signing the Tax Back agreement or b) have signed an Advantage Arkansas or Create Rebate agreement within the previous 48 months. See Arkansas Incentives Tier Map

Applicants for Tax Back must also obtain an endorsement resolution from a local governing authority authorizing the refund of its local taxes. Applicants must meet the qualification criteria under the requisite Advantage Arkansas or Create Rebate program in which they are participating and must be approved by AEDC.

The refund of sales and use taxes shall not include the refund of state taxes dedicated to the Educational Adequacy Fund provided in §19-5-1227 or the state taxes dedicated to the Conservation Tax Fund provided in §19-6-484; which totals 1%. The state tax rate is 6.5%, therefore the eligible refund amount is 5.5%.

Eligibility

  • Manufacturers in NAICS codes 31-33
  • Businesses primarily engaged in the design and development of software, digital content production and preservation, computer processing, data preparation services or information retrieval services. Eligible computer-related businesses must derive at least 51% of their revenue from out-of-state sales and pay an average in excess of 125% of the lesser of the state or county average hourly wage to employees whose payroll is subject to incentive benefits.
  • Businesses primarily engaged in film and digital product productions and post-productions that derive at least 51% of their revenue from out-of-state sales and pay an average in excess of 125% of the lesser of the state or county average hourly wage to employees whose payroll is subject to incentive benefits.
  • Distribution centers that derive 75% of their sales revenue from out-of-state customers
  • Intermodal facilities with more than one mode of interconnected movement of freight, commerce, or passengers.
  • Office sector businesses that support primary business needs and that are non-retail businesses deriving at least 75% of their sales revenue from out-of-state.
  • National or regional corporate headquarters as classified in the NAICS code 551114
  • Businesses primarily engaged in research and development in the physical, engineering, and life sciences as classified in the NAICS codes 541713, 541714, 541715.
  • Scientific and technical services businesses that derive at least 51% of their revenue from out-of-state sales and pay an average in excess of 150% of the lesser of the state or county average hourly wage to employees whose payroll is subject to incentive benefits.
  • Businesses primarily engaged in support activities for air transportation, NAICS Code 488190, that derive at least 75% of their revenue from out-of-state sales.
  • Businesses primarily engaged in support activities for rail transportation, NAICS Code 488210, that derive at least 75% of their revenue from out-of-state sales.

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