Arkansas Sales Tax

When making sales to customers in Arkansas, there are several factors to consider in determining if you must register to collect and remit sales tax. While local businesses have a clear mandate, out-of-state sellers must decide whether or not they have a physical or economic nexus. Additionally, you must stay current on what items are taxable—such as the 2026 change to grocery taxation—and whether your services or digital products are subject to the state’s 6.5% base rate.

Arkansas Sales Tax Rates

The state tax rate in Arkansas is 6.5%. However, cities and counties can impose their own local taxes, which often brings the total combined rate much higher. As of 2026, the highest combined rate in the state is 12.625% (in locations like Gillham).

It is important to note a major 2026 update: Act 1008 has officially eliminated the state’s 0.125% reduced tax on groceries. While local city and county taxes may still apply to food, the state portion is now 0%.

Tax Sourcing

Arkansas is a destination-based state. This means that if you are shipping goods to a customer, you must charge the sales tax rate applicable to the delivery address, not your place of business. For over-the-counter sales made at a physical storefront in Arkansas, the rate is based on the store’s location.

Arkansas Nexus

Having a “nexus” means your business has a sufficient connection to the state to require tax collection. Arkansas recognizes both physical and economic nexus. If you’re based out-of-state, however, determining your sales tax responsibility for full tax compliance can be a bit more complex. Arkansas requires any seller with a significant presence in the state to register to collect sales tax on purchases to Arkansas customers. A significant presence for the purposes of physical and economic nexus is generally considered:

Physical Nexus

You have a physical nexus in Arkansas if your business:

• Maintains a warehouse, office, or retail store in the state.
• Has employees, representatives, or agents operating in the state.
• Stores goods in a fulfillment center (such as those operated by major marketplaces).
• Conducts regular, systematic solicitation of sales through advertising or marketing in the state.

Economic Nexus

Established in 2019, economic nexus applies to remote sellers with no physical presence. You are required to register and collect sales tax if your sales to Arkansas customers in the current or previous calendar year meet either of the following thresholds:

1. $100,000 in gross revenue; OR
2. 200 or more separate transactions.

Marketplace Facilitators

If you sell exclusively through a marketplace (like Amazon or Etsy) and that platform collects and remits tax on your behalf, those sales generally do not count toward your $100,000/200-transaction threshold. However, if you sell via your own website in addition to a marketplace, your direct sales must be monitored.

What is Taxable in Arkansas

Tangible Goods

Most tangible personal property is taxable in Arkansas. Examples of goods that are taxed include groceries, prepared food, clothing, medicines, fuel, and machinery. Some exemptions include:

• Medical devices
• Downloaded software
• Food and merchandise from vending machines
• Digital products
• Newspapers

Services

Arkansas only taxes enumerated services. If a service is not specifically listed in the tax code, it is generally exempt. Taxable services include:

• Janitorial and cleaning services.
• Wrecker and towing services.
• Pool cleaning and maintenance.
• Initial installation of certain tangible goods.

Shipping and Handling

If the item being sold is taxable, the shipping and handling charges are also taxable. If the item is exempt, the shipping is generally exempt. If a shipment contains both taxable and exempt items, the entire shipping charge is typically taxed.

Digital Goods and Services

Arkansas taxes “specified digital products.” This includes:

• E-books, digital music, and streaming video/audio.
• SaaS (Software as a Service): Currently, SaaS is not taxable in Arkansas because it is not classified as tangible personal property or a specified digital product.

Sales Tax Holidays

Arkansas has a state sales tax holiday on the first Saturday and Sunday in August. During this period, the following are exempt from both state and local taxes:

• Electronic Devices: Computers, tablets, and calculators (no price cap).
• Clothing: Under $100 per item.
• Clothing Accessories: Under $50 per item.
• School Supplies: Most items (no price cap).

Registration and Filing

To collect tax, you must register through the Arkansas Taxpayer Access Point (ATAP).

Registration Fee: There is a one-time $50 fee for a sales tax permit.

SST Registration: Because Arkansas is a full member of the Streamlined Sales and Use Tax Agreement (SSUTA), out-of-state sellers can register for multiple states, including Arkansas, at once through the SST website.

Filing Frequencies

Depending on the volume of taxable sales you’ve made or expected to make in the state and so your estimated annual sales tax liability, you will be assigned a filing frequency at the time of registration. This may be monthly, quarterly, or annually, and regardless of the frequency, returns and payments will be due on the 20th of the month following the close of the period in question.

Monthly Due Dates

Period	Due Date
January	February 20
February	March 20
March	April 20
April	May 20
May	June 20
June	July 20
July	August 20
August	September 20
September	October 20
October	November 20
November	December 20
December	January 20

Quarterly Due Dates

Period	Due Date
January – March (Q1)	April 20
April – June (Q2)	July 20
July – September (Q3)	October 20
October – December (Q4)	January 20

For those taxpayers filing annually, returns and payments are due on January 20th of the following year. If the 20th of any month falls on a weekend or holiday, returns and payments will be considered timely if they’re received by the next business day. Zero returns are required in Arkansas.

Penalties and Interest

Failure to comply with Arkansas tax law results in the following:

• Late Filing Penalty: 5% of the tax due per month (or fraction thereof), up to a maximum of 35%.
• Late Payment Penalty: 5% of the unpaid tax (or 1% per month depending on circumstances, capped at 35% total combined with filing penalties).
• Interest: Assessed at 10% per annum (0.833% per month) on any unpaid balance.

Resources

• Arkansas Sales and Use Tax Homepage
• Arkansas Sales and Use Tax Forms
• Arkansas Sales and Use Tax Due Dates

Arkansas State Sales Tax Software

When you’re making sales to customers across Arkansas and possibly other states as well, there are a lot of elements to keep track of. You need to know when to add sales tax onto the purchase price of an item, what rate to use, who to remit your payments to, and how frequently to file.

Fortunately, the TaxTools tax calculator can help you streamline these processes and significantly ease your administrative burden. TaxTools is software specifically designed to keep track of the various state and local regulations surrounding the collection of sales tax, and it can seamlessly integrate with your eCommerce platform. Through TaxTools, you can view and print reports of taxable sales with location information, file state and local sales tax returns, keep track of filing deadlines, and much more.

So if you’re ready to learn more about the advantages TaxTools provides, click here or sign up for a free trial today.

Last updated January 2026