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Weekly Address – February 26, 2021

From the hallways of the most beautiful state Capitol in our great nation, this is Senator Keith Ingram.

Arkansas workers who were laid off last year will not have to pay income taxes on their unemployment benefits, thanks to legislation passed by the Senate.

Revenue officials estimate that the Senate bill will save those workers about $3 million.

The bill covers everyone who claimed unemployment benefits, but the impetus for the bill was that so many working Arkansans lost their jobs due to the economic impact of the Covid-19 pandemic.

The tax break extends to this year, which means that if you collect unemployment in 2021 you will not have to pay state income taxes on those benefits when you file in 2022.

The savings will be more than $5 million next year, according to revenue estimates.

The Senate passed another bill to benefit Arkansas businesses impacted by the pandemic. Many businesses had to lay off employees because of government orders issued when the governor declared a public health emergency.

Those businesses will not be charged for any unemployment benefits paid after April 4 of 2020.

That means their rates will not increase, which is only fair because government directives were the reason they had to lay off workers in the first place.

The bill has an emergency clause, so it will go into effect as soon as it is signed by the governor, which is good news for barber shops, hair salons, restaurants, and other businesses that were forced to close their doors because of the Covid-19 virus.

The House has passed and sent to the Senate a third measure to provide relief to businesses impacted by the pandemic.

It exempts from state income taxes any grants, loans and payments that businesses received from federal disaster relief programs.

A good example is the loan forgiveness provision of the Paycheck Protection Program. Also, the Small Business Administration has issued grants to help companies stay afloat.

According to revenue estimates, the legislation will save Arkansas businesses about $33 million next year and $179 million the following year.

In related news, federal education officials have said they would be flexible in how they require states to administer standardized tests in April.

This will help local school districts, particularly with the ACT Aspire tests that schools use to assess students’ skills in math, reading and science in grades three through 10.

Already this year, the legislature has temporarily suspended the use of letter grades on school report cards, which allow parents to assess how well a district or a school is performing. That bill was motivated, in large part, because of the disruptions to standardized testing schedules.

From the Capitol, it is always my greatest honor and most sincere privilege to serve you as your state Senator. This is Senator Keith Ingram.


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