Arkansas governor proposes grocery tax repeal

State of play: While the Grocery Tax Relief Act seeks to repeal the grocery tax effective Jan. 1, 2026, the Good Neighbor Act will seek to expand protections for food bank donors, including churches, restaurants, farmers, grocery stores and wholesalers, Sanders said during a news conference.

• Food banks sometimes cannot accept certain products, and the proposed changes are intended to make it easier to donate, she said.

By the numbers: Arkansas is one of 10 states with a grocery tax, according to AARP. Of those states, it has the lowest rate at 0.125%.

• The tax generates about $10 million yearly in revenue for the Arkansas Game and Fish Commission and the Department of Parks, Heritage and Tourism, the Arkansas Times reported.
• "These agencies have very healthy, strong budgets," Sanders said, adding that Arkansas' growing tourism industry is one of reasons it has the ability to cut the grocery tax.

What we're watching: The bills have not yet been filed.