A massive Arizona income tax cut that mainly benefits the wealthy championed by GOP Gov. Doug Ducey and enacted by Republicans who control the state Legislature in 2021 will go into full effect ahead of schedule next year, Ducey’s office announced Thursday.
The plan will save taxpayers about $1.9 billion next year compared to before the plan was enacted, although the vast majority of those cuts go to high-earning Arizonans. The cuts started at $1.5 billion this tax year and were to be phased in once the state met revenue targets, which came a year before projections.
The flat tax plan eliminates the state’s old graduated income tax scale, which started at 2.59% and had a maximum tax of 4.5% for income over $159,000 a year for a single person. All taxpayers will now pay a maximum of 2.5%.
Ducey says the average family will save $350 a year, but the Legislature’s budget analysts put that figure much lower. Meanwhile, high-earning Arizonans will see huge benefits.
“These tax cut overwhelmingly benefit the richest Arizonans and do very little for middle- or low-income Arizonans,” said David Lujan, President and CEO of the Children’s Action Alliance, a lobbying group that advocates for child welfare and education issues.
”If you’re making over half a million dollars a year, you get an average tax cut of over $16,000 annually,” Lujan said. “A household with $70,000 a year gets a $58 annual tax cut.”
Ducey has mainly waived off the inequities in who benefits from the measure he signed last year, instead trumpeting the effects on the state’s economy,
“This tax relief keeps Arizona competitive and preserves our reputation as a jobs magnet and generator of opportunity,” he said in a statement.
Opponents of last year’s tax cut package, mainly backers of public education, collected enough signatures to block it from taking effect until a vote in November’s election. But the state Supreme Court halted that effort in April, agreeing with business groups that tax legislation is not subject to the voter referendum process in the state constitution.
Republicans who steered the tax cuts through the Legislature last year also hailed the acceleration. The tax law said the full cut would go into effect if revenues yearly exceeded $12.9 billion. Revenue in the budget year that ended June 30 reached $16.7 billion, the most ever.
Republican Senate President Karen Fann called it “incredible news for the hardworking men and women of Arizona,” who are dealing with inflation and a potential recession she blamed on government spending by congressional Democrats.
But the tax cuts could cut both ways if a recession hits. Arizona was among the states that had to make the biggest spending cuts after the Great Recession hit in late 2007.
Lujan said state rosy revenues figures are inflated by federal pandemic spending.
“If our economy goes into a recession like a lot of people think, all these tax cuts are going to mean we’re going to have to cut the next time we see an economic downturn,” he said.
5 thoughts on “Massive Arizona income tax cut going into full effect – Associated Press”
Regarding government spending, we must remember government, local, state, federal has no money until and unless it takes it from us in the form of taxes or fees. Also, employees of government take care of themselves better than the average employee in private business and the pensions are solid; unlike most company’s today in the non government world.
So when you think of tax cuts think less spending by government and more retention of earnings by “We the People”.
Yes, Tom. Governments are able to provide generous benefits to their employees because they are not under pressure to turn a profit in order to remain viable. Businesses go under all the time. There are only a few instances of local governments going into bankruptcy.
This is another slanted, “progressive” hit piece by the far left Associated Press. Let’s see what this article says.
“A massive Arizona income tax cut that mainly benefits the wealthy …”
“Meanwhile, high-earning Arizonans will see huge benefits.”
“These tax cut overwhelmingly benefit the richest Arizonans and do very little for middle- or low-income Arizonans”
Do you think that maybe the high-earning Arizonans PAY THE MOST TAXES and therefore would expect to get a larger tax break than someone paying lower taxes?
The left-leaning Associated Press is one of the propaganda organs of the democrat party and promotes the socialist policies of the democrats. They want to foment class warfare between the more affluent and the less affluent citizens as part of their plan to divide and conquer America.
As usual, AP will quote only people that support their Radical Left position. For example, there is absolutely no arithmetic backup provided for the bewildering $16,000 (on AVERAGE, not MEDIAN, Danger, Will Robinson, Danger!!) vs $58 argument (does the denominator for that calculation includes people that don’t pay any State tax at all?). Distorted!
Nope AP only quotes a LOBBYIST whose business it is to siphon off money from the taxpayer feed trough to their cause. AP presents it as THE ABSOLUTE AP TRUTH. BELIEVE THE GREAT AND ALL-POWERFUL AP OR BE DESTROYED!! Fake news!!
Here’s the reality. Arizona’s Republican’s CUT TAXES and stimulate economic growth that benefits everyone. Conversely, the Democrat Party steal elections, RAISE TAXES (i.e. steal money) and use the stolen tax money to BUY VOTES and BUILD A DICTATORSHIP. That’s what the Democrat Party does. Destructive!
Here are some examples of how The Space Clown has reckless spent our money and taken clear action against the best interest of Arizona.
Voted for the idiotic “Inflation Reduction Act” where the clown Democrats argued that we need to spend more money to fight inflation. Good grief, how stupid do you think we are Space Clown?
Voted YES SIR, OH GREAT KING CHUCK SCHUMER I WILL DO EXACTLY AS YOU ORDER, to cough up $1 billion in OUR MONEY for stimulus checks for prisoners. Yep, you read that right, he took our money and gave it to criminals that have been convicted in a court of law and locked up in prison. Hey Space Clown, get the money back from the prisoners and give it back to us.
Voted 4 times, REPEAT FOUR TIMES to shut down the Keystone XL pipeline and voted 3 time, REPEAT THREE TIMES to ban fracking. He sure has a lot of nerve claiming he’s fighting to reduce fuel prices for Arizona (good God, those radio ads are annoying). What a liar.
Voted 3 time, REPEAT THREE TIMES, to defund construction of the US-Mexico border wall, voted against hiring 18000 new Border Patrol personnel, broke his promise to pressure Joe “Election Thief” Biden to fund AZ National Guard troops for border security.and voted against the renewal of the highly successful Trump Title 42. Oooooh, Trump started it so it must be bad and I’ll vote against it. He sure has a lot of nerve claiming he’s “worked hard to assure a secure border”. Liar!
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