Cities bemoan school tax hike

(February 11, 2004) — (Hope-AP) -- Some municipal leaders in Arkansas are afraid a state sales tax increase to pay for education reforms could have unintended side effects. In Hope, leaders fear it will become harder to raise local taxes to pay for projects like community centers. The tax increase also threatens nearby Texarkana, where it will push the state and local sales tax up to a dime. On the other side of the state line in Texarkana, Texas, the sales tax rate is only 8.25 percent. The state legislature passed the largest tax increase in state history this month to pay for 400 million dollars in court-ordered education reforms. The statewide seven-eighths-of-a-cent sales tax increase, which is set to take effect March first, pushes Hope's total local and state sales tax to 8.75 percent. Hope Mayor Dennis Ramsey says the legislature took the path of least resistance.