TO AMEND AND MODERNIZE THE LAW CONCERNING THE APPORTIONMENT OF INCOME DERIVED FROM MULTISTATE OPERATIONS; AND TO CHANGE THE METHOD FOR SOURCING OF RECEIPTS FOR SERVICES AND INTANGIBLES.

SB 567, now Act 719, amends Arkansas's Multistate Tax Compact and Uniform Division of Income for Tax Purposes Act. This legislation modernizes the rules for how income from businesses operating in multiple states is divided for tax purposes. A key change is the method for sourcing receipts from services and intangible assets, shifting from a "cost of performance" approach to a "market-based sourcing" approach. This affects multistate businesses that generate income within Arkansas by changing how their income is apportioned for state tax purposes.