Arizona Conforming To Federal Income Tax Law

By Howard Fischer, Capitol Media Services
Published: Friday, February 1, 2019 - 7:51am

Republican lawmakers in the House and Senate voted Thursday to conform Arizona's income tax deductions to federal law, which is what Gov. Doug Ducey wanted. However, conforming means fewer deductions on the state form, so the bill also cuts tax rates across the board, which translates to less revenue to the tune of $155 million.

Democratic Rep. Pamela Powers Hannely said the state needs that money.

"There are many programs and services that were cut during the last recession that have not been restored, particularly public education," she said. "And so if we have another recession and we give these taxes away today we could face massive cuts in the future if there's another economic downturn."

Gov. Ducey has said the additional revenue should be put into the state’s rainy-day fund. But with this measure in play, Ducey will have to decide whether to sign or veto it.

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