FACT SHEET FOR ACT 1441 SALES TAX EXEMPTION FOR UTILITIES ACT 1441 OF 2013 provides an exemption from state and local sales taxes for electricity, natural gas, and liquefied petroleum gas used by qualifying agricultural structures and qualifying aquaculture and horticulture equipment beginning Jan. 1, 2014. The eligible utility must be separately metered and used only for the purpose of the exemption. If a utility is sold for any other purpose, it will not be eligible for the exemption. Before the exemption is allowed, the farmer seeking the exemption must obtain a certificate from DFA to provide to the utility supplier.
WHO IS ELIGIBLE? Qualifying agricultural structures includes: • A poultry or livestock facility used for commercial production, including without limitation a broiler or turkey grow-out house, laying house, hatching unit, nursery unit, breeding house, farrowing unit, and feed-out house; • A cattle or dairy facility, including without limitation a milking parlor, milk collection unit, and refrigeration unit; • A greenhouse used for commercial production.
Qualifying AQUACULTURE* or HORTICULTURE* equipment: • A cooling unit, collection unit, or irrigation equipment used in a commercial horticulture operation; • Equipment used to pump and aerate a pond used in a commercial aquaculture operation; • A holding and sorting tank used in a commercial aquaculture operation. * Definitions of “horticulture” and “aquaculture” on back.
STEPS TO GET EXEMPTION 1. Based on above criteria, deter- 3. Fill out forms and submit to: mine if you have an eligible structure. Remember structure cannot share a meter or tank with a home or other ineligible structure.
Department of Finance & Administration Sales and Use Tax Section PO Box 3566 Little Rock, AR 72203-3566
2. Get forms by calling the
4. DF&A will then send you a
state Department of Finance and Administration at 501-682-7105 or www.dfa.arkansas.gov (in the forms section). You can also call your local county Farm Bureau or visit Arkansas Farm Bureau’s website, www.arfb.com.
certificate certifying that your meter or tank is tax exempt.
5. When you receive your cer-
tificates, get copies to your utility providers so they know not to apply tax to those meters or tanks.
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Arkansas Farm Bureau worked for several legislative sessions to achieve this goal. The estimate for an exemption on energy would cut taxes by around $10 million. That savings, assuming a moderate multiplier, would mean a positive $25 million economic impact. This tax cut greatly benefits our state’s family farms and rural communities.
DEFINITIONS OF ‘HORTICULTURE’ & ‘AQUACULTURE’ * For purposes of this tax exemption, “horticulture” means: the initial production and cultivation of fruits, vegetables, tree nuts, trees, shrubs, vines and florist stock. “Horticulture” does not include the cultivation of fruits, vegetables, tree nuts, trees, shrubs, vines and florist stock at a retail or wholesale facility from which the items are sold. * For purposes of the tax exemption, “aquaculture” is defined as the active cultivation of domesticated fish that are spawned, grown, managed, harvested, and marketed on an annual, semiannual, biennial, or shortterm basis in waters that are confined within a pond, tank, or lake that is situated entirely on the premises of a single owner and that, except under abnormal flood conditions, are in no way connected by water or with any other flowing stream or body of water; or body of water not situated on the premises of the owner.