Differing Legislative Views On State Income Taxes Means System Will Likely Stick Around
The Arizona state income tax will likely be sticking around for the foreseeable future despite calls from the Governor to reduce the tax rate to zero. That’s because legislative leaders have vastly different hopes for the system.
Incoming house speaker J.D. Mesnard said he wants to simplify the current state income tax system by using a single rate for all income levels, rather than using the current five brackets.
Soon to be Senate President Steve Yarbrough said he likes the state income tax because of the credit system for people who contribute to charities. He said it supports causes around the state including “school choice” programs like the one he runs.
Those stances go against Gov. Doug Ducey’s plans though. Ducey campaigned on a platform that lower tax rates are a good thing.
"And we want to always have a story where we're talking to companies like Raytheon or Rogers or Google of why we're a better place to do business," Ducey said. "That brings the jobs that employ our citizens and that’s what really expands our state budget."
But with costs for the state medicaid system and public education expected to rise, other state legislators say the state may not be able to afford a reduction in taxes.