LITTLE ROCK, Ark. — For years now, Arkansas has continuously seen a steady rise in our state's surplus.
"It's great, I mean, it's what we want to see," Scott Hardin, spokesperson for DFA, said. "We can't take this for granted, every state doesn't see this every month. We've now had 50 plus months of exceeding our forecast, meaning for the last 50 months, the amount we collected exceeded our expectations. It's a great place to be."
Much of that money comes from income and sales tax— Hardin explained how that's easily number one and two on the list of reasons that we keep seeing this.
Some of those surpluses' have even crossed the billion-dollar mark in the past few years.
It's a trend that has continued into the first quarter of this fiscal year.
"So, we're $144 million beyond forecasts for this fiscal year," he said.
In fact, the state has collected so much in that tax revenue that even though levels are down compared to this time last year, net revenue is still above by over $140 million.
As for the reason why, Hardin said part of it may be due to those coming from outside Arkansas.
"Since January 1, we've had more than 40,500 people move into Arkansas from other states," he said.
New residents have been coming from states like California, Texas, Missouri, and Florida.
More people means more income tax, and those paychecks have to be spent somewhere.
"What we see in Arkansas is that sales tax revenue, which is based on how much people spend, that's continued to grow," Jeremy Horpedahl, an economist at UCA, said. "Sales tax revenue is actually bigger than it's been in the past."
With how much our surplus has continued to grow, there have been calls to completely eliminate the state income tax, like many of our neighboring states. Those calls have also come from Governor Sarah Huckabee Sanders.
On X, formerly known as Twitter, the Governor posted, "As our economy grows, government shrinks, and revenues climb, we'll cut taxes even more to phase out our income tax entirely."
Horpedahl explained how while state lawmakers push towards that, a slower approach may need to happen.
"It makes up about half of the state's general revenue," he said. "So if you were to drop it to zero now, you would not have surplus, you'd have huge deficits."
As for when those cuts could happen, Hardin said it's up to our elected officials.
"Discretion of the lawmakers and the Governor," he said. "We're here to help."
Remember, this isn't the first time lowering income tax has been discussed. State lawmakers passed cuts earlier this year.