‘Jobs bill’ rewritten without personal income tax cut
Published: April 5, 2010 at 5:39 pm
A House bill that was intended to reduce business and personal taxes has been rewritten and is now scheduled for a hearing in the Senate Finance Committee on April 7.
But Senate President Bob Burns said H2250, sponsored by House Speaker Kirk Adams, might not be ready for a committee vote because lawmakers need time to consider the changes contained in the strike-everything amendment as well as additional amendments that might be necessary.
“We’re still not all on the same page on that bill,” Burns said, referring to ongoing talks between House and Senate Republicans. “We need to make sure we know where we are going on that.”
The strike-everything amendment set for consideration by the Senate Finance Committee would remove a 5 percent individual income tax cut for all Arizonans that was included in the original version of H2250 as passed by the House.
The amendment also would delay other tax cuts that were outlined in the original bill.
For instance, the state equalization tax was to be eliminated after a four-year period of gradual reduction beginning in 2011, but the amendment would postpone the first round of reductions until 2014.
A two-percentage-point cut to corporate income tax rates was originally planned to happen in equal increments over four years beginning in 2011, lowering the corporate income tax rate to 5 percent from about 7 percent by 2014. But the amendment would extend the implementation period to five years, with smaller reductions during the first two years than during the final three.
An aide to Adams said additional changes would be made to the strike-everything amendment when the bill is heard in committee, but those changes were still being crafted by legislative staff.
If the Senate approves the bill with amendments, it will go back to the House for another round of votes.
Burns has said the bill needs to be carefully analyzed since it would have a significant impact on the state at a time when Arizona is reeling from huge budget deficits.
A fiscal analysis by legislative staff showed the bill, if passed, would cost the state about $800 million in revenue in fiscal 2015. The budget hit would total $941.8 million in fiscal 2017 when the tax cuts would be in full force.
The individual income tax cut, which was left out of the strike-everything amendment, accounted for $361 million of the estimated general fund impact in fiscal 2017.
-Reporter Jim Small contributed to this story.