Its the final days of the legislative session and the House and Senate must reconcile their budgets before they can send a final package to the Governor for her signature. Will tax cuts be on the table? That's now up to the leadership of Senate President Tim Bee, Majority Leader Thayer Verschoor, and Majority Whip John Huppenthal.
The biggest difference between the House and Senate budgets is the size of the tax cut. The House budget includes a tax cut of $62 million. The Senates is $7 million.
The cornerstone of the House tax relief package is a reduction in Arizona's corporate income tax rate. Arizona's corporate income tax is nearly seven percent, which places Arizona's rate among the highest in the western United States. The House tax relief package includes a modest 2.5 percent rate reduction. The Senate doesn't address this issue whatsoever.
Arizona is home to more than 51,000 companies that pay corporate income taxes. These companies contributed almost $1 billion in general fund revenue last year nearly a 100 percent increase from 2003. A modest income tax rate reduction would encourage further investment, job creation, and even more economic growth.
As negotiations continue, its in the best interests of Arizona taxpayers for the Senate to consider the House tax package. The Senate needs to take a stand in support of pro-growth tax cuts.
Steve Voeller is President of the Arizona Free Enterprise Club and an occasional writer for the Goldwater Institute.
-Goldwater Institute: Corporate Tax Reform: How to Woo Business Without Spending a Dime
-Goldwater Institute: The Budget Buster that Wasn't
-Goldwater Institute: Getting Serious about Tax Reform
-Arizona Free Enterprise Club