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Arkansas’ Freeport Law applies to finished inventories maintained by manufacturers within the state and to goods stored in warehouses in transit to destinations outside the state.

Also covered in this tax exemption are goods that are moving through the state and may be stored in a warehouse, dock, etc., which are in transit to a destination outside of Arkansas.

Act 269 of 1969 states: “Tangible personal property in transit for a destination within this State shall be assessed only in the taxing district of its destination. Tangible personal property in transit through this State and tangible personal property manufactured, processed or refined in this State and stored for shipment outside the State shall, for purposes of ad valorem taxation, acquire no situs in the State and shall not be assessed for taxation in this State.”

A unique feature of Act 269 of 1969 is that goods that are manufactured in this state and then stored in a warehouse prior to distribution to points outside the state are not assessed for taxation in Arkansas.