1. All local taxes shall be collected only on the first $2,500.00 of gross receipts, gross proceeds, or sales price of a single motor vehicle, aircraft, watercraft, modular home, manufactured home, or mobile home.

2. Sellers should apply the $2,500.00 cap on the sale of a single motor vehicle, aircraft, watercraft, modular home, manufactured home, or mobile home. The purchase of additional tangible personal property in conjunction with the above enumerated items are eligible for the cap if the property is installed, affixed, or otherwise becomes a part of the motor vehicle, aircraft, watercraft, modular home, manufactured home, or mobile home prior to purchase.

Example: J.T. purchases a motorcycle. While at the dealer, J.T. picks out a windshield, saddle bags, pipes, and a helmet. If the windshield, saddle bags, and pipes are installed prior to the purchase, then those items are eligible for the cap. Tax should be calculated on the helmet separately.

3. A rebate of local sales and use tax is available for certain qualifying purchases of tangible personal property or a taxable service. (See Ark. Code Ann. § 26-52-523 and GR-92.)

1. Motor Vehicles and Trailers. - The local sales tax levied by the city and county of the purchaser's residence shall be due on the sale of a motor vehicle or trailer.

2. Other Sales of Tangible Personal Property and Services. Sales of tangible personal property and taxable services are sourced in accordance with the sourcing rules provided in Ark. Code Ann. §§ 26-52-521, 26-52-522, and GR-76.