Arkansas Sales Tax on Manufacturing and Machinery Arkansas: Sales Tax Handbook


Are Manufacturing and Machinery subject to sales tax?

While Arkansas' sales tax generally applies to most transactions, certain items have special treatment in many states when it comes to sales taxes. This page describes the taxability of manufacturing and machinery in Arkansas, including machinery, raw materials and utilities & fuel. To learn more, see a full list of taxable and tax-exempt items in Arkansas.

In the state of Arkansas, the exemptions will be made available for some sorts of replacements or the repairs of machinery and equipment, and for purchases which will be utilized in a new or expanding facility.

Raw Materials
In the state of Arkansas, the resale exemption applies specifically to materials which become a recognizable integral ingredient of the finalized product. Some other materials are considered to be taxable.

Utilities & Fuel
In the state of Arkansas, any sort of natural gas and electricity which is utilized by any sort of manufacturer who is directly involved in the manufacturing process or utilized by some sorts of electric power generators are usually taxed at a reduced rate. Any natural gases and electricity which has been purchased to be intended for use in the process of steel manufacturing or in the process of tile manufacturing are considered to be exempt.

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