ARKANSAS – In many states, janitorial and cleaning services aren’t taxable. However, that’s not the case in the Natural State.
One business taxpayer learned this the hard way after a sales tax audit from the Dept. of Finance and Administration.
Per Arkansas law, any cleaning services, defined as those that are designed to get rid of dirt, impurities or extraneous matter, fall under the category of janitorial services. That means they’re taxable.
The audit found the business hadn’t paid sales tax on janitorial services for four years. So it was on the hook for back tax, plus penalties and interest.
Though the business appealed the decision, a judge upheld it, saying it was correctly assessed sales tax and late penalties under the law.