The 51st Arizona Legislature’s Second Regular Session was solid and productive for the National Federation of Independent Business with Arizona’s small business owners scoring gains on taxes and regulatory reform while turning back troubling efforts to unlevel the playing field for small business in economic development.
Enhanced Small Business Bill of Rights — Rep. Tom Forese’s House Bill 2260 requires each state agency that conducts audits or on-site inspections to create and post on their website a Small Business Bill of Rights disclosing the regulated small business’ due process rights during regulatory enforcement actions. Also, for the first time regulators at the state OSHA agency (ADOSH) and auditors of unemployment insurance taxes are required to adhere to the state’s Small Business Bill of Rights.
Obamacare Navigators — House Bill 2508, sponsored by Reps. Phil Lovas and Paul Boyer, requires ‘navigators’ or those hired by the federal government to assist Arizonans purchasing health insurance through the Obamacare exchange to pass a criminal background check and be licensed by the state. This important new law helps enforce continued respect for privacy laws and prevention of identity theft.
Severance Pay and Unemployment Benefits — Rep. Karen Fann’s House Bill 2115 ensures that former employees must exhaust all their severance pay before being eligible for unemployment benefits and starting the draw down from the employer’s reserve account.
Reduced Reporting Requirements for Sales Taxes — House Bill 2288, championed by Rep. Debbie Lesko and Sen. Steve Farley, reduces the frequency of sales tax remittances for smaller retail operations.
Property Tax Abuses Prevented — NFIB successfully opposed multiple efforts to abuse the Class 6 Foreign Trade Zone designation that would have shifted hundreds-of-millions of dollars in the property tax liability from politically-influential industry sectors to small businesses and homeowners.
Registrar’s Power-Grab Killed — Sen. Gail Griffin’s Senate Bill 1160 reverses the provocative and aggressive assertion by the Registrar of Contractors that all who seek application or renewal of a contractors’ license must sign over to the agency access to their state tax records at the Department of Revenue.
Tax Bracket Indexing — Rep. Justin Olson’s House Bill 2377 halts “bracket creep” for individual income taxpayers for Tax Year 2015 by indexing or adjusting Arizona’s five individual income tax rates to account for inflation’s effect on the value of taxable earnings. Until passage of this bill, thousands of Arizonans every year were pushed into a higher tax rate simply by maintaining their inflation-adjusted income level.
Achieving permanent bracket indexing remains high on NFIB’s legislative agenda for 2015 as do enacting a couple of unwelcome vetoes from 2014. Rep. J.D. Mesnard’s House Bill 2664 was vetoed and would have permanently allowed for business equipment expensing of up to $500,000 annually mirroring in Arizona’s tax code the federal Section 179 expensing for small business. Also vetoed was Sen. Steve Yarbrough’s Senate Bill 1048 that would have advanced tax equity by extending eligibility to participate in the corporate school tuition tax credit program to “pass through” entities that file as S corporations, namely small business owners.
— Farrell Quinlan is Arizona state director for the National Federation of Independent Business (NFIB) and its 7,500 small business members in Arizona.