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ICYMI: Pinal Central: Excess state tax revenue should be returned to workers who earned it

Jun 3, 2021 by AFP

PINAL COUNTY, AZ –Americans for Prosperity-Arizona (AFP-AZ) State Director Stephen Shadegg recently penned an op-ed that ran in the Pinal Central on the benefits a proposal to reduce the state’s personal income tax rate would have for Arizona families, workers, and the economy.

The op-ed argues that the proposal would allow every Arizonan to keep more of what they earn and enable families to decide how they want to use their money. Shadegg makes the case that simplifying and reducing tax rates helps small businesses grow and create more jobs, attracting workers and businesses to the state.

Click here to read the entire op-ed.

Below are excerpts from the op-ed: 

As America rebounds from COVID-19, Arizona is among the states experiencing a surge in tax revenue that’s projected to grow in the months ahead. Legislators should continue to strive for responsible fiscal management, especially with a budget surplus of nearly $4 billion projected in fiscal year 2022.

Now is the time for lawmakers to work with the governor on tax reform that reduces the burden on working families, makes our state more competitive, and matches revenues to the highest priorities.

Fortunately, leaders in the Arizona legislature are considering reforms that would simplify our state’s tax system and lower the overall burden. This package is being debated as part of the annual state budget.

Arizona now has five personal income tax brackets, ranging from 2.59 percent to 8 percent. Under the plan included in the budget, beginning in 2023 the state personal income tax rate would be reduced to 2.5 percent for most taxpayers except the highest bracket who will pay 4.5 percent.

Under this system, every Arizona taxpayer will see a tax reduction. This change would put more money into the hands of families and allows them to make their own decisions about how their money is used. It would have no effect on the revenue of cities and other local governments, as some critics have charged, since the surplus and improving economy will help keep funding level.

The debate in Phoenix comes at a time when the president and leaders in Washington seem committed to raising taxes and spending in a reckless and damaging way. The New York Times has described the Biden tax proposal as the largest federal tax increase since 1942. Arizona should take a different approach that keeps taxes low and ensures we are much more responsible with our spending.

Right now, the shortcomings in Arizona’s tax code are keeping our state’s individuals, families, and businesses from realizing their full potential. A flatter and simpler tax system would help unleash growth and remove barriers to opportunity so each of us can improve our lives.