Arkansas Advocates for Children and Families has done an analysis of the impact of proposed legislation to eliminate the state capital gains tax. The top 1 percent would reap 75 percent of the benefits. Eighty percent of taxpayers would receive no benefit at all (about half that group) or about $1 to $3 (the other half).
Taxpayers making more than $352,000 a year would pay on average $7,142 less per year in taxes if capital gains taxes were eliminated in Arkansas. That compares to a tax break of $2 per year for middle-income workers. AACF based the analysis on microsimulation tax models run on Arkansas taxpayer data in November by the Institute on Taxation and Economic Policy.
"Cutting capital gains taxes in Arkansas would benefit millionaires and do nothing to support our state economy," said Rich Huddleston, AACF Executive Director.
By that standard (no economic help, rich folks reap a windfall), this tax repeal is a sure thing if the Arkansas legislature follows the new congressional model of taxing work, not wealth.