Arkansas Finances Soar: January Report Reveals Revenue Outpacing Expectations!

Summary

**Arkansas Reports Surplus in Early Fiscal Year 2026**

The Arkansas Department of Finance and Administration’s report for January 2026 indicates strong revenue performance for the first half of fiscal year 2026, covering July to December 2025. Total tax revenue reached an impressive $4.023 billion, reflecting a 1.2% increase compared to the prior year and surpassing expectations by 3%.

Net Available General Revenue totaled $4.109 billion, which is 2.8% higher than last year’s figures, resulting in a notable surplus of $102.9 million. The growth in revenue was primarily driven by increased sales and individual income taxes. However, corporate income tax revenue did not keep pace, impacted by a combination of refunds and rate reductions.

DFA Secretary Jim Hudson characterized the revenue collections as stable, adding that an updated revenue forecast is scheduled for release in late January, just before the upcoming legislative session.

**Focus Keyphrase**: Arkansas fiscal year 2026 revenue report
**Meta**: Arkansas Department of Finance and Administration reports a surplus for the first half of fiscal year 2026, driven by sales and individual income taxes.
**Tags**: Arkansas, finance, revenue report, surplus, tax revenue


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Key Points

• Total tax revenue for July-December 2025: $4.023 billion, +1.2% YoY and +3% above forecast.
• Revenue surplus grew to $102.9 million, up from prior reports.
• Sales tax: $1.825 billion, +3.2% YoY and +1.9% above forecast.
• Individual income tax: $1.691 billion, +1.5% YoY and +5.7% above forecast.
• Corporate income tax: $219.6 million, down from last year and 4.7% below forecast.
• December net general revenue slightly missed forecast due to corporate tax refunds.

Conclusions

• The report’s claim of stable, above-projection revenue is strongly supported by detailed breakdowns across tax categories, demonstrating broad-based growth except in corporate taxes.
• Weakness in corporate income tax collections aligns with recent rate reductions to 4.3%, providing evidence for the author’s implicit optimism tempered by specific shortfalls.
• Overall surplus projection appears robust, backed by consistent historical surpluses, though reliance on an upcoming forecast introduces minor uncertainty for the full year.

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