This new wallet card could save Arkansas farmers a trip through the paperwork pile

New card simplifies sales tax exemptions

Arkansas farmers now have a quicker way to claim sales tax breaks at checkout.

The state’s Department of Finance and Administration launched a new Farmers Sales Tax Exemption Card on Jan. 5, 2026.

Created under Act 621 of 2025, the wallet-sized card replaces the old process of filling out paper forms every time a farmer buys eligible supplies. The card doesn’t create any new tax breaks.

It just makes claiming the ones that already exist a lot easier.

Paper forms frustrated farmers for years

Before the card, farmers had to fill out exemption certificates like Form ST-403 or Form ST-391 and hand them to sellers with every purchase.

Sellers then had to keep those paper forms on file for six years in case of an audit. Now, farmers can show a single card at checkout and skip the paperwork entirely.

The old forms are still available for anyone who prefers them, though. The card is completely optional.

Card covers equipment, feed, and seed

The exemption covers items farmers use directly in commercial farming. That includes animals, chemicals, feed, machinery, and seed.

Think tractors, sprayers, irrigation equipment, mechanical pickers, and fertilizer. These exemptions already existed under Arkansas law, specifically under Arkansas Code sections 26-52-403, 404, and 405.

The card just gives farmers a faster way to apply them at the register instead of dealing with paperwork every time.

Some common farm items don’t qualify

Not everything farmers buy is covered. Repairs and parts for farm equipment are still taxable, along with fencing materials, building materials, and metal buildings.

Vehicles licensed for highway use, tires, utility trailers, and lawn mowers don’t qualify either. Lubricants and oil used to maintain equipment also remain taxable.

Farmers should check the full list of exempt and non-exempt items before assuming a purchase qualifies for the exemption.

Applying takes minutes and costs $20

Farmers can apply online through the Arkansas Taxpayer Access Point. A new card costs $20, and renewals run $10.

Once approved, the Department of Finance and Administration mails the durable, wallet-sized card within days.

The card stays active for eight years from the date it’s issued, so farmers won’t need to worry about renewing anytime soon. The process was built to be quick and simple.

Not every farmer qualifies automatically

To get a card, applicants must farm as a business, meaning they commercially produce food, fiber, grass sod, or nursery products.

They also need to show they have the resources to produce those products in marketable quantities.

The state asks for a Schedule F, Form 1065, or similar federal tax form showing farming activity over the past three years.

New farmers with less than three years of experience can submit a detailed business plan instead.

Each card carries a unique ID number

Every card lists the name and address of the farm or farmer, plus the issue date, expiration date, and a unique identification number. That number matters at the register.

Retailers can use it to properly account for nontaxable sales in their records.

The setup keeps things simple for both sides of the transaction, giving farmers a fast checkout and giving retailers a clear paper trail.

Misuse carries real penalties

Retailers who accept the card in good faith don’t have to worry. The law protects them from liability on those sales.

But Act 621 also gave the Department of Finance and Administration power to go after anyone who claims an exemption they don’t actually qualify for.

The state can assess sales tax, interest, and penalties in those cases. That enforcement piece was written into the law to keep the program honest.

Two lawmakers pushed the bill through

Rep. DeAnn Vaught from District 87 and Sen. Tyler Dees from District 35, both Republicans, introduced the bill as House Bill 1594. Gov. Sarah Huckabee Sanders signed it into law.

The card program was part of a larger group of agriculture-related laws that passed during the 2025 legislative session. The law took effect on Jan. 1, 2026, and the DFA began issuing cards five days later.

Up to 40,000 farmers could qualify

State officials estimate that about 40,000 farmers across Arkansas may be eligible for the card.

That lines up with the Arkansas Farm Bureau’s count of roughly 37,000-plus farms statewide, making agriculture the state’s leading industry.

DFA officials said they’ve seen strong early interest, especially in rural areas. The program is voluntary, but the early demand suggests farmers are ready to ditch the old paper system.

Exemptions make up nearly half of farm profits

Here’s why this matters: according to an Arkansas Farm Bureau analysis, sales tax exemptions account for an average of about 46% of farm profitability across the state.

Equipment like combines and cotton pickers can cost hundreds of thousands of dollars. Without exemptions applied at the time of purchase, farmers face high added costs on major equipment.

The card makes sure those savings hit at checkout, not months later.

DFA stands ready to answer questions

Farmers who want to apply can start at the Arkansas Taxpayer Access Point online.

The DFA Sales Tax Division is also available by phone at 501-682-1895 for anyone who has questions or needs help with the process. Full details on which items qualify and which don’t are listed on the DFA website.

The old exemption forms remain available there too, for farmers who want to stick with paper.

This article was created with AI assistance and human editing.

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