Arkansas Bill Would Tap Revenue, Raise Tax For Highways

Jan 28, 2019

The Big Rock Interchange in west Little Rock on July 8, 2015, where interstates 630 and 430 meet. The bill by Rep. Dan Douglas would provide funding for future highway needs.
Credit Michael Hibblen / KUAR News

An Arkansas lawmaker has proposed tapping into tax revenue from car sales and imposing a new tax on motor fuels to raise money for the state's highways, combining two approaches that have faced significant opposition in the predominantly Republican Legislature.

Republican Rep. Dan Douglas filed a bill Monday that he said he hoped would start the conversation on highway funding, which legislative leaders and Gov. Asa Hutchinson have called a priority for this year's session.

Douglas' proposal calls for gradually diverting tax revenue from vehicle sales to highways over a four-year period, hitting a maximum of $120 million a year. The transfer would begin once Arkansas' gross sales tax revenue exceeds $2.5 billion. It also calls for imposing a 3.5 percent sales tax on the wholesale price of motor fuel.