Arkansas Code Annotated

Ark. Code Ann. § 26-53-102 (2026)

Definitions

✓ current as of May 2026

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As used in this subchapter:

“Alcoholic beverage” means a beverage that is suitable for human consumption and contains five-tenths of one percent (0.5%) or more of alcohol by volume;
1. “Bundled transaction” means a retail sale of two (2) or more products, except real property and services to real property, in which:
  1. The products are otherwise distinct and identifiable; and
  2. The products are sold for one (1) nonitemized price.
2. “Bundled transaction” does not include the sale of any product in which the sales price varies or is negotiable based on the selection by the purchaser of the products included in the transaction.
3. The Department of Finance and Administration shall promulgate rules to implement this subdivision (2);
1. “Candy” means a preparation of sugar, honey, or other natural or artificial sweeteners in combination with chocolate, fruits, nuts, or other ingredients or flavorings in the form of bars, drops, or pieces.
2. “Candy” shall not include a preparation containing flour and shall require no refrigeration;
“Dietary supplement” means any product, other than tobacco, intended to supplement the diet that:
1. Contains one (1) or more of the following dietary ingredients:
  1. A vitamin;
  2. A mineral;
  3. An herb or other botanical;
  4. An amino acid;
  5. A dietary substance for use by humans to supplement the diet by increasing the total dietary intake; or
  6. A concentrate, metabolite, constituent, extract, or combination of any ingredient described in this subdivision (4)(A) and is intended for ingestion in tablet, capsule, powder, softgel, gelcap, or liquid form, or if not intended for ingestion in that form, is not represented as conventional food and is not represented for use as a sole item of a meal or of the diet; and
2. Is required to be labeled as a dietary supplement, identifiable by the “Supplement Facts” box found on the label and as required pursuant to 21 C.F.R. § 101.36, as in effect on January 1, 2007;
“Digital audio works” means works that result from the fixation of a series of musical, spoken, or other sounds, including ringtones;
“Digital audio-visual works” means a series of related images that, when shown in succession, impart an impression of motion, together with accompanying sounds, if any;
“Digital books” means works that are generally recognized in the ordinary and usual sense as “books”;
“Digital code” means a code that:
1. Provides a purchaser with a right to obtain one (1) or more specified digital products; and
2. May be obtained by any means, including email or tangible means, regardless of its designation as a song code, video code, or book code;
1. “End user” means a person who purchases specified digital products or the code for specified digital products for his or her own use or for the purpose of giving away the product or code.
2. “End user” does not include a person who receives by contract a product transferred electronically for further commercial broadcast, rebroadcast, transmission, retransmission, licensing, relicensing, distribution, redistribution, or exhibition of the product, in whole or in part, to another person or persons;
1. “Food” and “food ingredients” mean substances, whether in liquid, concentrated, solid, frozen, dried, or dehydrated form, that are sold for ingestion or chewing by humans and are consumed for their taste or nutritional value.
2. “Food” and “food ingredients” do not include candy, a soft drink, an alcoholic beverage, tobacco, or a dietary supplement;
“In this state” or “in the state” or “within this state” means within the exterior limits of the State of Arkansas and includes all territory within those limits owned by or ceded to the United States of America;
“Motor vehicle” means a vehicle that is self-propelled and is required to be registered for use on the highway;
“Person” means any individual, partnership, limited liability company, limited liability partnership, corporation, estate, trust, fiduciary, or any other legal entity;
“Prepared food” means:
1. Food sold in a heated state or heated by the seller;
2. Two (2) or more food ingredients mixed or combined by the seller for sale as a single item; or
3. 1. Food sold with an eating utensil provided by the seller, including a plate, knife, fork, spoon, glass, cup, napkin, or straw.
  2. As used in subdivision (14)(C)(i) of this section, “plate” does not include a container or packaging used to transport the food;
1. “Purchase” means the sale of tangible personal property, specified digital products, a digital code, or taxable services by a vendor to a person for the purpose of storage, use, distribution, or consumption in this state.
2. 1. “Purchase” also includes any withdrawal of tangible personal property, specified digital products, or a digital code from a stock or reserve maintained outside of the state by a person and subsequently brought into this state and thereafter stored, consumed, distributed, or used by that person or by any other person.
  2. In such an event, the tax shall be computed on the value of the tangible personal property, specified digital products, or digital code at the time it is brought into this state.
3. No tax shall be computed to the extent that a withdrawal consists of carbonaceous materials such as petroleum coke or carbon anodes that are to be directly used or consumed in the electrolytic reduction process of producing tangible personal property for ultimate sale at retail;
“Purchaser” means a person to whom a sale of tangible personal property, specified digital products, or a digital code is made or to whom a taxable service is furnished;
“Ringtones” means digitized sound files that:
1. Are downloaded onto a device; and
2. May be used to alert the customer with respect to a communication;
1. “Sale” means a transfer, barter, or exchange of the title or ownership of tangible personal property, specified digital products, a digital code, or taxable services or the right to use, store, distribute, or consume the tangible personal property, specified digital products, a digital code, or taxable services for a consideration paid or to be paid in installments or otherwise and includes any transaction whether called leases, rentals, bailments, loans, conditional sales, or otherwise, notwithstanding that the title or possession of the property, or both, is retained for security.
2. For the purpose of this subchapter, the sale of tangible personal property, specified digital products, a digital code, or taxable services shall be sourced according to §§ 26-52-521 — 26-52-523;
1. “Sales price” or “purchase price” means the total amount of consideration, including cash, credit, property, and services, for which tangible personal property, specified digital products, a digital code, or services are sold, leased, or rented, valued in money, whether received in money or otherwise, without any deduction for the following:
  1. The seller's cost of the property sold;
  2. The cost of materials used, labor or service cost, interest, losses, all costs of transportation to the seller, all taxes imposed on the seller, and any other expense of the seller;
  3. A charge by the seller for any service necessary to complete the sale, other than a delivery or installation charge;
  4. Delivery charge;
  5. 1. Installation charge.
    2. However, installation charges shall not be included in the sales price if they are not a specifically taxable service under the Arkansas Gross Receipts Act of 1941, § 26-52-101 et seq., or this subchapter and the installation charges have been separately stated on the invoice, billing, or similar document given to the purchaser; or
  6. Credit for any trade-in.
2. “Sales price” or “purchase price” does not include:
  1. A discount, including cash, term, or a coupon that is not reimbursed by a third party and that is allowed by a seller and taken by a purchaser on a sale;
  2. Interest, financing, and carrying charges from credit extended on the sale of tangible personal property, specified digital products, a digital code, or services if the amount is separately stated on the invoice, bill of sale, or similar document given to the purchaser; and
  3. Any tax legally imposed directly on the consumer that is separately stated on the invoice, bill of sale, or similar document given to the purchaser;
“Seller” means a person making a sale, lease, or rental of tangible personal property, specified digital products, a digital code, or services;
1. “Soft drink” means a nonalcoholic beverage that contains natural or artificial sweeteners.
2. “Soft drink” does not include a beverage that contains milk or milk products, soy, rice, or similar milk substitutes, or that is greater than fifty percent (50%) of vegetable or fruit juice by volume;
“Specified digital products” means the following when transferred electronically:
1. Digital audio works;
2. Digital audio-visual works; and
3. Digital books;
“Storage” means any keeping or retention in this state of tangible personal property, specified digital products, a digital code, or taxable services purchased from a vendor for any purpose except sale or subsequent use solely outside this state;
1. “Tangible personal property” means personal property that may be seen, weighed, measured, felt, or touched or is in any other manner perceptible to the senses.
2. “Tangible personal property” includes electricity, water, gas, steam, and prewritten computer software.
3. “Tangible personal property” does not include specified digital products or digital codes;
“Taxable service” means a service that is taxable under this subchapter or the Arkansas Gross Receipts Act of 1941, § 26-52-101 et seq.;
“Taxpayer” means any person remitting the tax or who should remit the tax or should have remitted the tax levied by this subchapter;
“Tobacco” means a cigarette, cigar, chewing or pipe tobacco, or any other item that contains tobacco;
“Transferred electronically” means obtained by the purchaser by means other than tangible storage media;
1. “Use”, with respect to tangible personal property, specified digital products, or a digital code, means the exercise of any right or power over tangible personal property, specified digital products, or a digital code incident to the ownership or control of that tangible personal property, specified digital product, or digital code except that it does not include the sale of that tangible personal property, specified digital product, or digital code in the regular course of business.
2. With respect to a taxable service, “use” means the privilege of using the service, enjoyment of the service, or the first act within this state by which the purchaser takes or assumes dominion or control over the service or the tangible personal property, specified digital products, or digital code upon which the service was performed; and
1. 1. “Vendor” means a person engaged in making sales of tangible personal property, specified digital products, digital codes, or taxable services by mail order, by advertising, or by agent, by peddling tangible personal property, specified digital products, a digital code, or taxable services, by soliciting, or by taking orders for such sales for storage, use, distribution, or consumption in this state.
  2. “Vendor” includes all salespersons, solicitors, hawkers, representatives, consignees, peddlers, or canvassers as agents of the dealers, distributors, consignors, supervisors, principals, or employers under whom they operate or from whom they obtain the tangible personal property, specified digital products, digital code, or taxable services sold by them.
2. Regardless of whether a person is making sales on his or her own behalf or on behalf of dealers, distributors, consignors, supervisors, principals, or employers, the person must be regarded as a vendor, and the dealers, distributors, consignors, supervisors, principals, or employers must be regarded as vendors for purposes of this subchapter.

History. Acts 1949, No. 487, § 4; 1961, No. 43, §§ 1, 2; 1983, No. 829, § 1; 1985, No. 999, § 1; A.S.A. 1947, §§ 84-3104, 84-3104n; Acts 1995, No. 1160, § 22; 2003, No. 1273, § 12; 2007, No. 181, § 31; 2009, No. 384, §§ 11, 12; 2009, No. 655, § 28; 2017, No. 141, §§ 44-47; 2019, No. 910, § 3895.

Amendments. The 2009 amendment by No. 384 deleted former (12)(A)(vi), redesignated the subsequent subdivision accordingly, and made related changes; and added present (7).

The 2009 amendment by No. 655 deleted former (7)(B), redesignated the remaining subdivision accordingly, deleted “joint venture” following “limited liability partnership,” and made a related change.

The 2017 amendment inserted the definitions for “Candy”, “Digital audio works”, “Digital audio-visual works”, “Digital books”, “Digital code”, “End user”, “Ringtones”, “Soft drink”, “Specified digital products”, and “Transferred electronically”; inserted “candy, a soft drink” in (11)(B) [now (10)(B)]; inserted “specified digital products, a digital code” or similar language following “tangible personal property” throughout; added (25)(C) [now (24)(C)]; and made stylistic changes.

The 2019 amendment repealed the definition for “Director”.

Effective Dates. Acts 2017, No. 141, § 63, as amended by Acts 2017, No. 596, § 1: “Sections 2 through 61 of this act are effective for tax years beginning on and after January 1, 2018.”

Case Notes

Person.

The use tax was not intended to be applied to purchases made by a municipality, since the “persons” to be taxed were defined in the Sales Tax Act to include “corporations,” “cities” and “municipalities,” whereas in the Use Tax Act passed to complement the sales tax only “corporations” of these terms was set out in the definition of “persons.” Scurlock v. City of Springdale, 224 Ark. 408, 273 S.W.2d 551 (1954) (decision prior to 1961 amendment).

Since tax acts are construed in favor of the taxpayer, a court would not imply that the word “corporation” included “municipal corporation” in the definition of “persons” subject to the use tax. Scurlock v. City of Springdale, 224 Ark. 408, 273 S.W.2d 551 (1954) (decision prior to 1961 amendment).

Whereas definition of “person” as found in the Sales Tax Act specifically included this state, any county, city, municipality, school district, or any other political subdivision of the state, this section did not contain any such language; in failing to so define “person” the General Assembly thereby necessarily intended to exclude the state and its subdivisions from the Use Tax Act. Comm'r of Revenues v. Ark. State Hwy. Comm'n, 232 Ark. 255, 337 S.W.2d 665 (1960) (decision prior to 1961 amendment).

Since the definition of “person” in the Use Tax Act did not specifically include the state or its subdivisions, it was not broad enough to apply to the State Highway Commission. Comm'r of Revenues v. Ark. State Hwy. Comm'n, 232 Ark. 255, 337 S.W.2d 665 (1960) (decision prior to 1961 amendment).

Purchase.

To establish its claim that the repair parts were purchased for “resale,” a taxpayer must show that the repair parts were purchased outside this state, that it is regularly engaged in the business of reselling the goods purchased, and that the parts were purchased for resale. Federal Express Corp. v. Skelton, 265 Ark. 187, 578 S.W.2d 1 (1979).

Where chlorine is used in the manufacture of bromine, the chlorine does not become a part of the bromine, but quite the opposite, the chlorine takes something from the bromine, becomes chloride, and is discarded as worthless; thus it is at best consumed in the manufacturing process, not resold to the purchaser as tangible property, and is subject to the use tax. Great Lakes Chem. Corp. v. Wooten, 266 Ark. 511, 587 S.W.2d 220 (1979).

Sale.

Out-of-state corporation that solicits orders for sale in Arkansas through traveling salesmen is liable for use tax on sales though sales are subject to approval of office of corporation located out of state. Thompson v. Rhodes-Jennings Furniture Co., 223 Ark. 705, 268 S.W.2d 376, cert. denied, 348 U.S. 872, 75 S. Ct. 108, 99 L. Ed. 686 (1954).

Out-of-state corporation that authorized its salesmen to enter into written contracts with residents of Arkansas for sale of merchandise and also required maintenance of salesroom in Arkansas, plus on the spot service and inspection of machinery sold, was liable for use tax. Thompson v. Rhodes-Jennings Furniture Co., 223 Ark. 705, 268 S.W.2d 376, cert. denied, 348 U.S. 872, 75 S. Ct. 108, 99 L. Ed. 686 (1954).

Where agents of company representing numerous magazine publishers recruited students to sell magazine subscriptions, and the students after making their sales sent the checks and money collected to a clearing house designated by the company, the company made “sales” of the magazine subscriptions within the meaning of this section. Ragland v. Quality School Plan, Inc., 279 Ark. 256, 651 S.W.2d 447 (1983).

Sales Price.

If a general contractor purchases a precast concrete component, the tax due is based upon the price of that component; however, if a general contractor purchases the raw materials and produces the component from those raw materials, it is taxed only on the price paid for the raw materials. Pledger v. Featherlite Precast Corp., 308 Ark. 124, 823 S.W.2d 852, cert. denied, 506 U.S. 826, 113 S. Ct. 82, 121 L. Ed. 2d 46 (1992).

Because services that are part of the sale are not to be excluded in the use tax assessment, the professional skills and labor of an advertising agency are necessarily included in the costs of advertising materials. Pledger v. Baldor Int'l, Inc., 309 Ark. 30, 827 S.W.2d 646 (1992).

Tangible Personal Property.

A magazine subscription is “tangible personal property” within the meaning of this section. Ragland v. Quality School Plan, Inc., 279 Ark. 256, 651 S.W.2d 447 (1983).

Precast concrete components, large, specially designed and constructed pieces of concrete, were tangible personal property and not real property at the time they were transported to a jobsite. Pledger v. Featherlite Precast Corp., 308 Ark. 124, 823 S.W.2d 852, cert. denied, 506 U.S. 826, 113 S. Ct. 82, 121 L. Ed. 2d 46 (1992).

Use.

Under the statutory definition, the right to use property cannot be separated from the property itself. American Television Co. v. Hervey, 253 Ark. 1010, 490 S.W.2d 796 (1973).

Where aircraft belonging to interstate air freight carrier were retained in the state for approximately 50 days to receive extensive modifications, the aircraft were subject to the compensating tax, even though ultimate use of the aircraft was in the carrier's interstate system. Skelton v. Federal Express Corp., 259 Ark. 127, 531 S.W.2d 941 (1976) (decision prior to 1976 amendment of § 26-53-115).

Vendor.

The definition of a “vendor” in this section is quite inclusive, and a sale cannot be made in Arkansas without someone being the vendor. Ragland v. Quality School Plan, Inc., 279 Ark. 256, 651 S.W.2d 447 (1983).

Notes of Decisions

Cited in 5 cases, 1992–2014 · leading case: Pledger v. Troll Book Clubs, Inc., 871 S.W.2d 389 (Ark. 1994).

Sort: Relevance Newest Treatment

Pledger v. Troll Book Clubs, Inc., 871 S.W.2d 389 (Ark. 1994). · cites it 12× “Ark. Code Ann. § 26-53-102 (4) (1987). In my opinion, teachers soliciting on behalf of Troll Book Clubs, Inc.”

Pledger v. Featherlite Precast Corp., 823 S.W.2d 852 (Ark. 1992). · cites it 4× “] Ark. Code Ann. § 26-53-102 (1987) in part provides: As used in this subchapter, unless the context otherwise requires: (1) “Sales price” means the consideration paid, or given .”

Pledger v. Baldor Int'l, Inc., 827 S.W.2d 646 (Ark. 1992). · cites it 4× “Ark. Code Ann. § 26-53-102 (1) (1987); Ark.”

Boral Gypsum, Inc. v. Leathers, 924 S.W.2d 805 (Ark. 1996). · cites it 2× “Appellee responds that it is not NGT’s use of the compressor fuel that it seeks to tax, rather it seeks to tax appellant’s use of the compressor fuel as payment to NGT for transporting appellant’s gas to its plant in Nashville.”

State Dep't of Revenue v. Kelly's Food Concepts of Alabama, LLP, 157 So. 3d 944 (Ala. Civ. App. 2014). “” Ark. Code Ann. § 26-53-102 (9)(C)(i). In Nebraska, “prepared food” is defined, in part, as including “[flood sold with eating utensils provided by the seller, including plates, knives, forks, spoons, glasses, cups, napkins or straws.”

— Ark. Code Ann. § 26-53-102(1) — 1 case

Pledger v. Baldor Int'l, Inc., 827 S.W.2d 646 (Ark. 1992). “Ark. Code Ann. § 26-53-102 (1) (1987); Ark.”

— Ark. Code Ann. § 26-53-102(4) — 1 case

Pledger v. Troll Book Clubs, Inc., 871 S.W.2d 389 (Ark. 1994). “Ark. Code Ann. § 26-53-102 (4) (1987). In my opinion, teachers soliciting on behalf of Troll Book Clubs, Inc.”

— Ark. Code Ann. § 26-53-102(6) — 1 case

Boral Gypsum, Inc. v. Leathers, 924 S.W.2d 805 (Ark. 1996). “Appellee responds that it is not NGT’s use of the compressor fuel that it seeks to tax, rather it seeks to tax appellant’s use of the compressor fuel as payment to NGT for transporting appellant’s gas to its plant in Nashville.”

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