Arizona House Committee Advances $162 Million Tax Cut

By Holliday Moore
Howard Fischer, Capitol Media Services
Published: Thursday, February 13, 2020 - 8:08am

Arizona Republican lawmakers say the state has more money than it needs and taxpayers deserve a $162 million state tax cut next year.

On Wednesday, the House Ways and Means Committee voted along party lines for House Bill 2778, an across-the-board cut in individual income tax rates, that also gives individuals filing non-itemized tax returns more room to write off charitable donations.

The change in charitable deductions would cost the state $2.1 million the first year, but the amount would rise with inflation. That worries Democratic Rep. Mitzi Epstein, who estimated the amount eventually ballooning to $100 million a year.

"It is not a surplus when we look at the needs of the state," she reminded fellow lawmakers of the state's sagging education fund and the explosion in homelessness. "The needs of the state far outweigh any revenue that we have," she said.

That argument did little to persuade Republican counterparts like Rep. Joanne Osborne.

"There are always needs," Osborne said. "We certainly could spend every dollar that is here."

Osborne went on explainthat it's the job of lawmakers to achieve balance, "and that balance also goes towards the taxpayers."

Part of the reason the state has more money this year is the "conforming" Arizona's income tax structure underwent in the 2017 federal Tax Cuts and Jobs Act.

The other reason comes from the U.S. Supreme Court decisions allowing Arizona to begin taxing online sales made to consumers in the state.

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