* Takes Effect July 2014
Thanks to the efforts of ASDA members, the sales and use tax on dental appliances was repealed by the Arkansas legislature earlier this year, but the repeal does not take effect until July 2014. This tax on appliances, including dentures, partials, crowns and bridges, has burdened dentists since 1991 when the appliances were not included on a list of “adaptive medical equipment” that was approved for exemption by the General Assembly. Since that time, numerous dentists have been forced to pay state taxes on dental appliances ordered from out of state, or by in-state dental labs that did not collect and remit the appropriate tax. Several state audits of dental practices resulted in penalties of $100,000 or more. The Arkansas Department of Finance and Administration estimated that the fiscal impact of the repeal will be $961,500 annually.
Senate Bill 853 was sponsored by Sen. Larry Teague (D-Nashville), who had carried the measure on behalf of ASDA in previous sessions of the legislature and played a leading role in its successful outcome. The bill became Act 1414 of 2013 when Governor Beebe signed it on April 22.
With the help of ASDA members, including Rep. Deborah Ferguson (D-West Memphis), ASDA successfully argued the following points:
- These appliances, which are critical to an individual’s health and quality of life, deserve the same exemption as adaptive medical equipment, which included canes, crutches, orthopedic shoes, and hearing aids.
- Dentures, partials, crowns and bridges are not “over the counter” items. Each appliance is uniquely and specifically prescribed and created for each individual patient, and is not interchangeable with other persons. Rather, they serve as prosthetics within the human body
- The primary beneficiaries of this bill will be the senior citizens and low income patients.
ASDA reminds members that this exemption does not take effect until July 2014, so continue to collect and remit the tax on these items until that time.