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These
discretionary incentives are for start-up companies in emerging
sectors that are less than five years old, have an annual payroll
between $200,000 and $1 million, and pay at least 150 percent to 180
percent of the county’s current average hourly wage, depending on
the tier of the county in which the business locates.
-
Emerging
technology sectors include:
-
Advanced
materials and manufacturing systems
-
Agriculture,
food, and environmental services
-
Biotechnology,
bioengineering, and life sciences
-
Information
technology
-
Transportation
logistics
-
Bio-based
products
Companies
meeting these criteria are eligible for a transferable income tax
credit equal to 10 percent of payroll for up to five years, a
transferable income tax credit equal to 33 percent of eligible
research and development costs, and sales and use tax refunds on
building materials and necessary equipment.
These incentives
are negotiated
By The Arkansas Department of Economic Development in Highly
Competitive Situations.
Create
Rebate Program
Businesses hiring
specified, new, full-time, permanent employees within 24 months
after completion of an approved expansion and/or new location
project may be eligible for the Create Rebate Program.
Under terms
negotiated by the Arkansas Department of Economic Development, this
program provides businesses a financial rebate from 3.9 to 5 percent
of the annual payroll of the new, full-time, permanent employees,
The financial incentive is 3.9 percent in Tier 1 counties, 4.25
percent in Tier 2 counties, 4.5 percent in Tier 3 counties, and 5
percent in Tier 4 counties. Please see map on page 39 for a
definition of the County Tier System.
In each tier of
counties, a minimum payroll of new, full-time, permanent employees
of $2 million annually is required.
Incentives are
available approximately 12 months after the business has fulfilled
the minimum payroll requirements.
Eligible
businesses include the following:
-
Manufacturers
in
NAICS
codes 31-33;
or
-
Eligible
computer businesses with no retail public sales that derive at
least 75 percent of their revenue from out-of-state sales;
or
-
Businesses
primarily engaged in commercial physical and biological
research;
or
-
Businesses
primarily engaged in motion picture production with no retail
public sales that derive at least 75 percent of their revenue
from out-of-state sales;
or
-
Distribution
centers, including e-commerce distributors, that derive at least
75 percent of their resources from out-of-state sales and have
no retail public sales;
or
-
Office sector
businesses or national, corporate, or regional headquarters with
no retail public sales;
or
-
Scientific and
technical services businesses that derive at least 75 percent of
their revenue from out-of-state sales.
ArkPlus
The basic
incentive provided by the ArkPlus program is a state income tax
credit that provides tax credits of 10 percent of the total amount
of the new investment. The amount of income tax credit taken during
any tax year shall not exceed 50 percent of the annual Arkansas
income tax liability resulting from the project.
To utilize the
ArkPlus program, businesses must sign a financial agreement prior to
construction outlining the terms of the incentives and including the
following:
Businesses must
invest a minimum of $2 million to $5 million in a plant or
construction or expansion project, depending on the tier of the
county in which the business is located.
Businesses must
have a payroll of at least $1 million to $2 million in new,
full-time, permanent employees, depending upon the tier of the
county in which the business locates, within 24 months of the date
that the financial agreement is signed and maintain the payroll
requirements at the new project location for the duration of the
incentive period. Failure to do so could result in termination of
the program and reimbursement of the incentives credited plus
penalty and interest.
Eligible
businesses include the following:
-
Manufacturers
in
NAICS
codes 31-33;
or
-
Eligible
computer businesses with no retail public sales that derive at
least 75 percent of their revenue from out-of-state sales;
or
-
Businesses
primarily engaged in commercial physical and biological
research; or
-
Businesses
primarily engaged in motion picture production with no retail
public sales that derive at least 75 percent of their revenue
from out-of-state sales;
or
-
Distribution
centers, including e-commerce distributors, that derive at least
75 percent of their resources from out-of-state sales and have
no retail public sales;
or
-
Office sector
businesses or national, corporate, or regional headquarters with
no retail public sales;
or
-
Scientific and
technical services businesses that derive at least 75 percent of
their revenue from out-of-state sales.
Research and Development
An income tax
credit of 33 percent is available to taxpayers who pay for research
performed at Arkansas universities. In addition, a 10 percent
income tax credit, capped at $10,000 per year, is available for
eligible businesses performing in-house research. Targeted
businesses may also earn transferable income tax credits equal to 33
percent of approved expenditures for in-house research.
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