I have a scaley skin on my right arm. What is it?

Sudden Scales. If it's located just in this one area in a patch-like fashion, it may be a form of eczema, which can also be itchy at times. If it is more diffuse and involves the entire arm as well as other areas in may be xerosis cutis or chronic dry skin. Areas of whitish scale with a bright red base and surrounding area is more consistent with psoriasis, a more severe chronic inflammatory skin condition.
See a dermatologist. What you describe can be anything from fungal infection, dry skin, to skin conditions like disseminated actinic porokerstoses, numular eczema or eczema craquele to psoriasis. A dermatologist should be able to diagnose you after seeing your skin and will treat you appropriately.